Lead Edge Capital

“Look, we speak to 10,000 companies a year. We have a team of 20, 18 to 22 year olds. So that's right, 20 to 20, we haven't gone pre-college yet. So you're like 20, 22 to 24 year olds that are speaking to 10,000 companies a year.”

“You should interview all your employees. From admin to your other partners, and basically ask them for feedback. Just be like, hey, if you were running the place, what would you do differently? You know, like, tell me everything you do in your job, green, red,…”

“Let's go find stuff that we can just build, like, you know, invest when they're 10 to twenty million dollar revenue software businesses, and exit them when they're 60 to eighty million dollar software businesses.”

“I think we questioned our existence in 20 and 21 as, like, we were just getting annihilated on prices.”

“With really in like, 2018 or 19, we really started to shift our business away from Silicon Valley based companies and needing to say every company needed IPO.”

“We tend to like, I think our bands that we tend to assume most exits at are like, Four to eight times revenues. Like, maybe sometimes 10 times at the absolute highest, if it's like growing 30, 40% a year.”

“And this is after speaking to probably 70,000 companies over the last decade. It's about a 10% yield.”

“Well I would tell you that we have two customers. Founders, but more importantly, LPs, because if you do not have LPs, you do not have a business.”

“Our stupidest mistakes were just, like, overpaying for a couple of companies. Assuming the exit multiple was going to be, like, higher than it actually is.”

“Are your revenues today greater than your historical cash burn? Cumulatively. Not raised. If you've raised 80, but only burned 20, and you have a forty million dollar revenue business, like that's a great business. But we're looking for like a one to one ratio…”

“I also think like LPs should spend more time talking to companies of portfolios that failed, like actually talk to the ones that didn't go well, or like were the one X's to find out what is the person really like to work with. Like the ones that work really we…”

“Snowflake. Like, massive. I mean, when we looked at Snowflake, it had, like, horrible gross margins. Like, but again, it was, we looked at it at five hundred million dollars, and, like, we were completely wrong.”

“I put on one hand the amount of people that are capable of backing companies like Google's and Facebook's of the world, and doing it more than once. Like, it's a really, really, really small group. It sure as heck isn't me.”

“I mean, we bought it at like, The position at like five times earnings. And we've gotten 90% of our money back through dividends in the company.”

“Alibaba was very cash efficient, actually, when we invested, it was a billion dollars of profit.”

“Late last year we were buying ByteDance. We were paying five times earnings for it. It grows, like, 25, 30% a year.”

“70% of the time, we're the first institutional investor.”

“So now if you like look at all of our exits, a third of our exits have actually come from, Come to private equity in those companies.”

“I believe a great question that people don't ask, that they should ask. Any manager who is around, who's been around 10 plus years, hey, in September of 21, September 30th of 21, how much unlocked stock did you have in your portfolio? And let's say September, …”

“So like, we run our business trying to figure out how do we have 97%, how do we keep up 97% gross dollar retention, not net, gross, With LPs.”

“Less than 10% of our companies are in the Bay Area.”

“Yes, we have a prep so we would get our one X, but if you told me today I could take a .7 X just to get out of it, I would happily cut you. I would happily do it.”

“When we invested in I think it was in seven, no, 1615, 16 time-ish, 17 time frame. It was like 25 of revenue, growing 250% a year. Like, what would that, that would be a billion dollar plus exit, that would be a 1,000,000,001, billion and a half dollar multipl…”

“And our model is like, we're going to be 95% backed by individuals and we're going to treat those individuals like gold.”

“I think we've had, like, two 10 X's ever, or something like that, but we've only had, like, you know, One or two zeros ever.”

“We also got two million dollars in the Shopify IPO, because we knew the founders. And that would have returned our second fund, like, two X, had we just not sold stock. Like, didn't have to do anything.”

“Probably a third of our deals have been secondary sales.”

“And so, like, the hardest decision is, actually, the hardest decision was, did we, should we have in, like, nine, 2017 and 18, like, and 16, like, paid, like, when everybody, when we were paying five to seven times revenues for software companies, and Iconic c…”

“When we were buying ByteDance stock, like, you know, we were buying it at prices, like, sub, you know, around two hundred billion dollars.”

“We're big investors in Toast, which we've been buying back. We were early investors in it, and sold, and are rebuying.”

“Look, it's, we've always struggled with how to invest there because of how capital inefficient a lot of those businesses are.”

“Listen, if your plan is to try to stay private forever, you're just not for us. Like, we just don't want to invest in you.”

“We are buyers. We're buying software stocks right now. You know, a portion of our funds can be invested in public equities, so we're buying companies like Procore, Workday, Appian.”

“So if you, if the company calls you back, it's like, hang up the phone. It's the CEO you call every two days for a month. That's who you want to get on the phone.”

“So we have a team of 18 22 to 24 year olds, like pounding the phones, calling companies all day long,”