Jul 26, 2023 · 1h 7m · news
Sri Batchu: Biggest Growth Lesson from Instacart & Opendoor; 70% of Experiments Should Fail | E1040 · 20VC with Harry Stebbings
0:00 / 0:00
▶ Watch on YouTube →
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of 20VC, Harry Stebbings interviews Sri Batchu, Head of Growth at Ramp, to discuss tactical frameworks for building and scaling high-performance growth teams, the operational necessity of prioritizing under constraints, and the strategic advantages of the operator-investor model.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 17.5% of the talking time here. How this is scored →
Harry as informed peer 3.3 Guest teaching 3.4 Guest disagreement 1.5 Harry pushing back 3.1
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 54:53 Ruthless view on portfolio talent poaching
Sri forcefully rejects the premise that angel investors shouldn't recruit from portfolio companies, calling anti-poaching norms anti-competitive and insisting it is solely the founder's job to retain talent.
Hardest push from Harry ▶ 45:10 Not buying operator network superiorityHarry directly rejects Sri's core argument that operators have superior deal flow networks, flatly stating 'Not buying it' and pressing Sri until he admits operator edges do not scale.
Biggest teaching moment ▶ 56:27 Bad operators making great foundersSri reframes Harry's assumption about operator capability by explaining why specific traits that make individuals poor corporate employees frequently equip them to be relentless startup founders.
Harry holds his own ▶ 45:10 Exposing micro-fund scalability limitsHarry showcases deep venture domain expertise by dismantling Sri's investment thesis, demonstrating why operator sourcing advantages decay and forcing Sri to concede that his strategy fails at higher check sizes.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Sri Batchu's Unorthodox Path to Growth | 4 | 3 | 1 | 4 | Harry challenges Sri's Opendoor victory narrative by introducing the market counter-argument that heavily capitalized rivals like SoftBank-backed Zillow could stay irrational longer than Opendoor could stay solvent. Sri defends their strategy by citing positive unit economics on every home cohort. Harry accepts the logic and transitions to Instacart. | |
| Takeaways from Instacart: Simplification as a Superpower | 2 | 3 | 1 | 2 | Sri breaks down Instacart's four-sided marketplace and how founder Apoorva Mehta enforced simplification through 'VPs of No'. Harry asks clarifying questions on what 'under one roof' means for organizational structure, which Sri addresses by contrasting reporting lines with shared North Star accountability. | |
| Choosing the Right North Star: Balancing Volume and Efficiency | 4 | 4 | 1 | 2 | Harry pushes an expert framing that revenue is an output metric rather than a true growth input. Sri expands on this by explaining how bad North Star metrics create perverse incentives, recommending SQL pipeline dollars as a balanced B2B guardrail. | |
| Why 'Slow is Smooth and Smooth is Fast' Prevents Growth Chaos | 2 | 3 | 1 | 2 | Sri explains the Marine philosophy 'slow is smooth, smooth is fast' to avoid growth chaos and notes that growth experiments carry a 70% failure rate. Harry asks how teams can systematically increase their speed to failure, prompting Sri to outline Ramp's two-week sprint cadences and day-counting cultural metric. | |
| Case Study: Opendoor's Adverse Selection Failure and the Role of Pre-Mortems | 3 | 5 | 1 | 3 | Harry asks an unscripted question about Sri's biggest growth failure, leading Sri to share an Opendoor case study on buying listed homes that suffered from severe adverse selection. Harry probes whether pre-mortems slow down execution speed, which Sri refutes by limiting pre-mortems to major strategic shifts. | |
| When to Hire a Growth Team and Who to Target First | 3 | 3 | 1 | 3 | Harry playfully pushes back on Sri's timing for hiring a growth team, demanding a precise ARR figure and forcing a choice between hiring a junior analyst versus a VP of Growth. Sri advocates for hiring biz-ops generalists early over narrow specialists. | |
| Designing a Rigorous Hiring Process for Growth Candidates | 4 | 3 | 2 | 5 | Harry roleplays an angel investor dynamic and forcefully challenges Sri's favorite interview question ('What are you bad at that you enjoy doing?') by arguing candidates should double down on superpowers rather than fix weaknesses. Sri defends the question as a test of intellectual curiosity and lack of fear of failure. | |
| Culture over Structure: Alignment & Translation Factors in Large Teams | 2 | 4 | 1 | 1 | Sri details how culture supercedes org structure in large teams, citing Instacart's 300-person growth organization where load time improvements were linked to active user growth via mathematical translation factors. Harry actively listens and prompts for concrete examples. | |
| Management Philosophy: Motivation, Trust, and the First One-on-One | 4 | 3 | 1 | 4 | Harry offers a stoic critique of employee self-awareness, questioning whether young workers actually know what motivates them or how they prefer feedback. Sri acknowledges this self-awareness gap and explains how his structured first 1-on-1 template serves as a diagnostic tool. | |
| Hiring Slow, the Resource Curse, and Letting Some Fires Burn | 3 | 4 | 1 | 4 | When Sri admits to hiring slowly, Harry challenges whether slow hiring is viable in fast-paced startup environments. Sri justifies his approach by describing the 'resource curse' of bloated teams and emphasizing the managerial skill of letting non-essential fires burn. | |
| Manager Mistakes: Coaching vs. Doing, and Balancing Strategic Gains | 2 | 3 | 1 | 2 | Sri highlights the common trap new managers face when doing subordinates' work instead of coaching them. Harry steers the discussion toward strategic trade-offs, getting Sri to detail Ramp's current shift toward customer segment alignment over pure acquisition channels. | |
| Scaling Burnout and the Operational Edge in Angel Investing | 2 | 3 | 1 | 1 | Sri articulates what breaks in scaling tech companies and presents his core investment thesis that active operators make superior early-stage angel investors due to a two-to-four year half-life on operational knowledge. | |
| The Operator-Investor Debate: Scalability, Diligence, and Distraction | 6 | 3 | 3 | 7 | Harry aggressively rejects Sri's operator deal-flow thesis, stating 'Not buying it' and arguing operator networks age rapidly. Harry demonstrates deep VC knowledge on micro-fund mechanics and scalability ceilings, forcing Sri to concede that operator edge does not scale to larger fund sizes. | |
| Sourcing Philosophy: Warm Intros, Hustle, and Managing Outside Interests | 3 | 3 | 2 | 4 | Harry questions whether Sri's refusal to accept cold outbound outreach creates an unfair, exclusionary gatekeeping dynamic for outsider founders. Sri defends his rule, contending that any resourceful founder should be capable of securing a warm intro. | |
| Context-Switching, Conflicts of Interest, and the Truth About Talent Poaching | 4 | 4 | 5 | 4 | Harry raises the ethics of angel investors poaching talent from their portfolio companies. Sri delivers a combative response, declaring he is 'pretty ruthless' about hiring top talent and dismissing anti-poaching expectations as anti-competitive. | |
| Lessons on Angel Investing & Founder Referrals | 4 | 4 | 2 | 4 | Harry pushes back on relying on operator founder referrals by emphasizing the stark difference between corporate operating and founding. Sri agrees and reframes the point, explaining how traits that make someone a mediocre corporate operator often make them exceptional startup founders. | |
| The Paradox of the Storytelling Founder | 3 | 3 | 1 | 4 | Harry identifies a contradiction in Sri's criteria, noting that storytelling founders are rarely strong operators. Sri resolves the apparent paradox by arguing that co-founding teams need distinct storytelling and operational roles to succeed at scale. | |
| Common Pitfalls of Operator Angel Investors | 5 | 3 | 1 | 2 | Harry lays out clear investor heuristics around fixed check sizing and minimum portfolio diversification numbers. Sri builds on this by identifying common cognitive traps for new angel investors, including risk aversion and the struggle to say no to friends. | |
| Matching Growth Hires to Company Stage | 2 | 3 | 1 | 1 | In the quick-fire section, Sri highlights misaligned growth leader seniority as a major hiring mistake and outlines Ramp's monthly post-mortem process. Harry closes the interview by thanking Sri for enduring his 'pitbull-like' interview style. |
Statements from this episode (49)
Batchu: Leaders must intentionally allow lower-priority problems to go unaddressed
“You have to let some fires burn. If you think you have to fight every fire on your team, you're going to burn yourself out. So you just have to realize that, like, some things are just not going to be worked on for a bit, and they're going to be broken, and be…”
Batchu: Future growth leaders will increasingly come from finance and analytics
“And I think you'll see more people like me because I think increasingly growth is a discipline of making a portfolio of bets, thinking about ROI, and thinking about data and experimentation in a rigorous way, which I think my background speaks to.”
Batchu: Opendoor never price-matched or negotiated with home sellers
“We never did a price match and we never negotiated on price with sellers of homes.”
Batchu: Opendoor was consistently profitable on every cohort of home purchases
“Our overall goal was to be, and we were consistently profitable on every cohort of homes that we were buying, so our goal was, even if they were, you know, outstripping us in volume, we would be able to survive for a long period of time because our, we were un…”
Sri Batchu: Instacart was more complex than Opendoor as a four-sided marketplace
“Instacart was in some ways an even more complicated business than Opendoor because it's a four sided marketplace. We have shoppers, we have buyers, we have advertisers, and we have the retailers that are on the platform as well with various different incentive…”
Sri Batchu: The best executives reject distracting initiatives regardless of impact
“Simplification is a superpower, and it's actually very difficult and a lot of executives, you know, when they're faced with two potentially high-impact initiatives, are often tempted to say, let's do both. Let's figure out how we can do both. The good ones can…”
Sri Batchu: Growth functions should only be built post-product-market fit
“Personally, to me, a growth function is something that you build post product market fit and is the home for all high volume data and experimentation oriented customer acquisition, retention, engagement strategies.”
Sri Batchu: Ramp unifies paid marketing, SEO, and PLG under one team
“And at RAMP they're all under one roof which is great and have the same kind of north stars and goals.”
Stebbings: Revenue is an output metric, not a valid North Star
“Often it's revenue and revenue for me is an output. It's not an input.”
Batchu: Dollars of SQL pipeline is the ideal B2B growth metric
“So typically for B to B you know, where I land at is like dollars of like SQL pipeline. Which kind of controls for that quality element and controls for the size of the lead element as an art.”
Batchu: Unstructured growth experimentation devolves into undiagnosable chaos
“In the early days of growth, you've got kind of a small ragtag team that's throwing a bunch of spaghetti at the wall and seeing what works, right? This works for a bit but it often tends to devolve into undiagnosable chaos. If things aren't working, you have n…”
Batchu: Growth experiments historically have a 30% success rate
“In my experience, and I've seen this to be pretty consistent actually across the various companies that I've worked on these types of projects growth has just a typically high failure rate. And my historical success rate that I've seen at various companies is …”
Batchu: Ramp operates product and non-product growth teams on two-week sprints
“We at ramp still, for example, run the growth team, whether it's product or non-product teams as well on a two week sprint cadence.”
Batchu: Ramp announces days since founding at every all-hands meeting
“And at Ramp, the other thing that we've done culturally as a company as well, is to just really drill that in, into the teams by talking about days actually. So we talk about what day it is since the founding of Ramp at every all hands, at every board meeting,…”
Batchu: Opendoor's listed-home bidding experiment failed due to adverse selection
“These homes, you know, we did this program for a few months, and we learned that they were tremendously unprofitable for Opendoor because of the adverse selection element and we had to shut down the program.”
Batchu: Reserve pre-mortems for major strategy departures and high-risk investments
“So I typically think of like pre-mortems as something that feels like a big departure from current strategy or something that's a lot of investment or that you believe has a lot of high potential in terms of visibility or risk or pipeline generation. For thing…”
Sri Batchu: Finding product-market fit is the founder's primary job
“Finding product market fit, in my opinion, is the founder's primary job. It is not something that you outsource to a growth team.”
Sri Batchu: Biz ops generalists outperform specialists in early startup growth
“The early days of growth can be managed by In my opinion, a lot of different types of people. I actually really liked the biz ops profile for the early days until you're like ready to really put some gas on the fire and, you know, hire a VP. But I think what's…”
Sri Batchu: Early growth leaders don't need prior Head of Growth titles
“I don't think so. I think what you want to look for is people that have, you know, the T-shaped classic thing where they have like a deep spike in one area or one discipline of growth in some way. And that, whether that spike is product, some function of marke…”
Batchu: Case study interviews should be required for growth roles at all levels
“I'm a big believer in doing a little bit of homework or a case study type of thing. And it works at, I think fundamentally you should do it for all levels. People often think about it as like something that you do for potentially a more junior candidate.”
Batchu: Case study interviews should avoid asymmetric information
“You either pick something that, you know, is about a third company or you pick a problem at your company that's relatively new to you that you haven't worked out yet. And give them the context to see how they think about it.”
Batchu: Candidate defensiveness during case presentations is a major red flag
“I think if you see a lot of defensiveness during the case presentation, for me, that's like a big red flag.”
Batchu: Instacart's growth and consumer team was over 300 people
“Instacart, the growth and consumer team was over 300 people, right?”
Sri Batchu: There is no inherently wrong motivation for employees
“And then I don't, I actually don't think there's necessarily a wrong motivation.”
Batchu: Excessively resourced software teams suffer a 'resource curse'
“I think teams get materially slower as they get bigger. It's really like the equivalent of a resource curse for companies rather than countries, right? When you have too many resources, you get bad at prioritizing and you get bad at accountability, and you act…”
Sri Batchu: Ramp historically underinvested in field and event marketing
“A fire that we have let burn for some time is you know, we just, at, Ramp, we have not historically invested a lot in, in field and event marketing because, you know, we've got a very large TAM, and it requires us to be thoughtful about our field and event str…”
Batchu: Ramp is pivoting growth strategy to customer segment-oriented teams
“The big short-term pain that we're taking is We're moving towards a larger company segment-oriented strategy, where we have cross-functional teams that are going after a customer segment and, you know, budgeting, goaling, everything based on this segment, whic…”
Sri Batchu: Active operators have a key edge over professional VCs
“I think operators have a distinct advantage especially with their smaller checks in earlier stages, across all four of those than a lot of professional investors.”
Batchu: An investor's operating experience has a two-to-four-year half-life
“There's also this notion of, like, a half-life to operating experience. Something like two to four years, which is, like, You know, every whatever X number of years you're away from operating and become a specialized or full-time investor, your ability to real…”
Batchu: Lead VCs share pre-diligenced deal flow with operators, not rival funds
“So I get deal flow from other investors all the time, especially ones that are like, you know, if Sequoia or craft or whoever are like, you know, we're leading this round. We're really excited about it. Do you want to be a part of it? That's great. Like a lot …”
Batchu: VC strategy changes fundamentally with every 5x increase in check size
“I think the strategy only works up to a certain size. And, you know, my general understanding with venture is the job is like materially different every five X or so the check size. So and it's a completely different job. What can help you win in the previous …”
Stebbings: Operating experience decays faster today than ever due to AI
“I also think like the rate of decay on operating experience has never been greater, like specifically on two, which is like, if you haven't operated in the world of AI, it's fundamentally different thinking kind of AI first and with AI as part of your stack th…”
Batchu: Founders unable to get warm intros lack basic hustle
“My theory is if you can't even succeed in getting a warm intro, how are you going to hustle and building a company? I only take conversations that are very high reputation, warm intros, where the person is, like, typically, like, already spoken to the person, …”
Batchu: Tech employees should be allowed side projects if job performance stays high
“As I mentioned before, I think as long as you're not, you know, distracted during work hours and getting your day job done, I think what you do outside of work is, is your prerogative.”
Batchu: Context switching through angel investing sharpens operator intuition
“I tend to find that the context switching and learning about different spaces actually builds more intuition and creativity for ideas. So I think in, in moderation, I actually think it's a good idea to do that.”
Batchu: Ramp team members must refuse meetings with potential competitors
“Obviously anything that could be competitive, perceived as competitive, or looks like it's down the line competitive, I don't even take the meeting and I strongly advise against anybody at the company taking meetings as well, if they're considering them.”
Batchu: Hiring from portfolio companies is not a conflict for angels
“I, I'm pretty ruthless about that. I think that there's absolutely no conflict. I think it's extremely anti-competitive from a labor market perspective for you to think that I won't hire the best people from your company. And so you, it's your job to retain yo…”
Batchu: Backed founders are an angel investor's top source of deal flow
“I think one is just how important the founders that you work with and invest in become as a source of leads for you. And I didn't fully imagine that when I started being an angel investor, I was like, oh, where am I going to find, you know, great deals to work…”
Batchu: Bad corporate operators can make better founders than top operators
“And I think what's actually interesting is there's some operators that are very good at their operating job that I think would be worse founders than some bad operators. Right. And I've like found this. So let me explain that a little bit further. There are pe…”
Batchu: Founding teams should split storytelling and execution roles
“I've definitely seen people that can do both, but it's rare that people can wear both hats. So I often tend to like founding teams where one person is the storyteller and the other person is like the, you know, operator and executor.”
Stebbings: Angels need uniform check sizes and at least 25 investments
“Lesson one, you don't have conviction at the early stage. Just do 25 K, 10 K, 50 K, I don't care, but same check size. Number two, you need 25. This idea that you're a genius picker, you're not. No one is. Five is not enough. You need 25.”
Batchu: Early investors must shift mindset to optimism on how startups succeed
“There's a mindset switch that you have to make, which is like, how can this succeed? And not about how it can fail. Like, it's very easy to think about all of the ways something can fail. And so the question that you have to ask yourself is like, how can this …”
Stebbings: Investing in founders who need your help is a trap
“I think the other one I see also is when they choose founders that need their specific help. So they're a B to B sales leader and they're like, oh, I could really help in that B to B sales engine. Doesn't mean it's a good investment.”
Sri Batchu: Cold outbound email remains an effective growth tactic
“I think cold outbound and email still works surprisingly well, despite all of the changes in that space.”
Sri Batchu: Indiscriminate paid marketing spending is permanently dead
“Pouring, you know, money indiscriminately into paid marketing, I think is gone for two reasons. One is, of course, like the efficiency environment, and I don't think we're going to be in a completely zerp environment again. And the other reason being, I think …”
Batchu: Do not hire VP-level growth leaders for small teams
“Either too senior or too junior for the given problem that they have. Too senior being like, you know, if you've got a three person growth team, like don't hire a VP level person because you actually need somebody that can really coach people and get into the …”
Batchu: Ramp tracks and scores all growth experiments monthly using Airtable
“Yeah, so we do monthly post-mortems. They're somewhat structured. We actually have a, you know, air table system where we track all of our experiments. We score them, et cetera, in terms of impact.”
Batchu: Involving others in problem-solving yields better results than asking for resources
“Ask for money, get advice. Ask for advice, get money twice. And to me, it's like super, super helpful framing for, like, almost any, like, difficult situation that you're dealing with, not just fundraising which is, like, the more you bring people into what yo…”
Sri Batchu: Notion built a rare, impressive community-led growth strategy
“One I'll pick is is, is Notion. I think they've done an incredible job of building a very large multi-pronged community based growth strategy, which I haven't seen a lot of companies do that. I think they're, it's very impressive.”