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Feb 23, 2015 · 20m · 20vc

20 VC 014: Acquired by Salesforce turned VC with Kyle Lui

Kyle Lui · 13m spoken Harry Stebbings · 5m spoken
0:00 / 0:00

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In this episode of The 20 Minute VC, host Harry Stebbings interviews Kyle Lui, former co-founder of Choice Pass and principal at DCM Ventures, about his journey from entrepreneurship to venture capital. Kyle shares key insights on startup pivots, corporate acquisition by Salesforce, early-stage investment criteria, and navigating regulatory risk in emerging markets.

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 28.5% of the talking time here. How this is scored →

Harry as informed peer 2.6 Guest teaching 3.4 Guest disagreement 0.8 Harry pushing back 1.8
05100:0010:0020:001:24–4:41 · Harry as informed peer 2/10 Kyle Lui's Career Path and Learning to Code Harry asks friendly, standard career entry questions about Kyle's transition from finance to tech and learning to code. Kyle explains his career path and educates Harry on learning Python via online resources like Learn Python the Hard Way.4:46–8:44 · Harry as informed peer 2/10 Choice Pass Acquisition by Salesforce and Corporate Culture Harry inquires about the emotional and operational aspects of selling Choice Pass to Salesforce. Kyle gently reframes Harry's suggestion that Salesforce was the only option for growth, explaining the appealing strategic alignment instead.8:45–11:24 · Harry as informed peer 2/10 Startup Challenges, Pivots, and Employee Incentives Kyle shares the story of Choice Pass pivoting from a daily-deals competitor to an enterprise rewards platform. Harry links this background to Kyle's investment in AnyPerk, allowing Kyle to detail his thesis on employee retention in Silicon Valley.11:24–16:35 · Harry as informed peer 3/10 Investment Strategy and Startup Evaluation Criteria Harry presses Kyle on specific investment criteria, asking whether college degrees are required and challenging Kyle's prioritization of team with 'Team over product?'. Kyle counters that degree requirements are not strict and firmly defends why team always supersedes product.16:35–18:35 · Harry as informed peer 4/10 Navigating Regulatory Risk in Medical Marijuana Investments Harry demonstrates industry knowledge by citing Leafly and Ease while asking about regulatory risks in medical marijuana. Kyle broadens the context, explaining that VCs routinely evaluate regulatory risks across tech sectors like drones and ride-hailing.1:24–4:41 · Guest teaching 3/10 Kyle Lui's Career Path and Learning to Code Harry asks friendly, standard career entry questions about Kyle's transition from finance to tech and learning to code. Kyle explains his career path and educates Harry on learning Python via online resources like Learn Python the Hard Way.4:46–8:44 · Guest teaching 3/10 Choice Pass Acquisition by Salesforce and Corporate Culture Harry inquires about the emotional and operational aspects of selling Choice Pass to Salesforce. Kyle gently reframes Harry's suggestion that Salesforce was the only option for growth, explaining the appealing strategic alignment instead.8:45–11:24 · Guest teaching 3/10 Startup Challenges, Pivots, and Employee Incentives Kyle shares the story of Choice Pass pivoting from a daily-deals competitor to an enterprise rewards platform. Harry links this background to Kyle's investment in AnyPerk, allowing Kyle to detail his thesis on employee retention in Silicon Valley.11:24–16:35 · Guest teaching 4/10 Investment Strategy and Startup Evaluation Criteria Harry presses Kyle on specific investment criteria, asking whether college degrees are required and challenging Kyle's prioritization of team with 'Team over product?'. Kyle counters that degree requirements are not strict and firmly defends why team always supersedes product.16:35–18:35 · Guest teaching 4/10 Navigating Regulatory Risk in Medical Marijuana Investments Harry demonstrates industry knowledge by citing Leafly and Ease while asking about regulatory risks in medical marijuana. Kyle broadens the context, explaining that VCs routinely evaluate regulatory risks across tech sectors like drones and ride-hailing.1:24–4:41 · Guest disagreement 0/10 Kyle Lui's Career Path and Learning to Code Harry asks friendly, standard career entry questions about Kyle's transition from finance to tech and learning to code. Kyle explains his career path and educates Harry on learning Python via online resources like Learn Python the Hard Way.4:46–8:44 · Guest disagreement 1/10 Choice Pass Acquisition by Salesforce and Corporate Culture Harry inquires about the emotional and operational aspects of selling Choice Pass to Salesforce. Kyle gently reframes Harry's suggestion that Salesforce was the only option for growth, explaining the appealing strategic alignment instead.8:45–11:24 · Guest disagreement 0/10 Startup Challenges, Pivots, and Employee Incentives Kyle shares the story of Choice Pass pivoting from a daily-deals competitor to an enterprise rewards platform. Harry links this background to Kyle's investment in AnyPerk, allowing Kyle to detail his thesis on employee retention in Silicon Valley.11:24–16:35 · Guest disagreement 2/10 Investment Strategy and Startup Evaluation Criteria Harry presses Kyle on specific investment criteria, asking whether college degrees are required and challenging Kyle's prioritization of team with 'Team over product?'. Kyle counters that degree requirements are not strict and firmly defends why team always supersedes product.16:35–18:35 · Guest disagreement 1/10 Navigating Regulatory Risk in Medical Marijuana Investments Harry demonstrates industry knowledge by citing Leafly and Ease while asking about regulatory risks in medical marijuana. Kyle broadens the context, explaining that VCs routinely evaluate regulatory risks across tech sectors like drones and ride-hailing.1:24–4:41 · Harry pushing back 1/10 Kyle Lui's Career Path and Learning to Code Harry asks friendly, standard career entry questions about Kyle's transition from finance to tech and learning to code. Kyle explains his career path and educates Harry on learning Python via online resources like Learn Python the Hard Way.4:46–8:44 · Harry pushing back 2/10 Choice Pass Acquisition by Salesforce and Corporate Culture Harry inquires about the emotional and operational aspects of selling Choice Pass to Salesforce. Kyle gently reframes Harry's suggestion that Salesforce was the only option for growth, explaining the appealing strategic alignment instead.8:45–11:24 · Harry pushing back 1/10 Startup Challenges, Pivots, and Employee Incentives Kyle shares the story of Choice Pass pivoting from a daily-deals competitor to an enterprise rewards platform. Harry links this background to Kyle's investment in AnyPerk, allowing Kyle to detail his thesis on employee retention in Silicon Valley.11:24–16:35 · Harry pushing back 3/10 Investment Strategy and Startup Evaluation Criteria Harry presses Kyle on specific investment criteria, asking whether college degrees are required and challenging Kyle's prioritization of team with 'Team over product?'. Kyle counters that degree requirements are not strict and firmly defends why team always supersedes product.16:35–18:35 · Harry pushing back 2/10 Navigating Regulatory Risk in Medical Marijuana Investments Harry demonstrates industry knowledge by citing Leafly and Ease while asking about regulatory risks in medical marijuana. Kyle broadens the context, explaining that VCs routinely evaluate regulatory risks across tech sectors like drones and ride-hailing.

speaking balance: gold is Harry, purple is the guest (3 minute bins)

0:00 · Harry 58.4% · guest 41.6%0:00 · Harry 58.4% · guest 41.6%3:00 · Harry 29.6% · guest 70.4%3:00 · Harry 29.6% · guest 70.4%6:00 · Harry 21% · guest 79%6:00 · Harry 21% · guest 79%9:00 · Harry 20.1% · guest 79.9%9:00 · Harry 20.1% · guest 79.9%12:00 · Harry 12.2% · guest 87.8%12:00 · Harry 12.2% · guest 87.8%15:00 · Harry 18.5% · guest 81.5%15:00 · Harry 18.5% · guest 81.5%18:00 · Harry 46.1% · guest 53.9%18:00 · Harry 46.1% · guest 53.9%
Sharpest disagreement ▶ 17:01 Reframing marijuana regulatory risk

Kyle gently pushes back on the premise that cannabis carries uniquely high regulatory risk, pointing out that VCs accept similar risks in drones and ride-sharing.

 Hardest push from Harry ▶ 15:58 Challenging team versus product

Harry explicitly interrupts and challenges Kyle's framework by pressing 'Team over product?', forcing Kyle to justify his ranking.

 Biggest teaching moment ▶ 17:01 Framework for regulatory risk in venture

Kyle educates Harry on how VCs evaluate regulatory shifts as market opportunities across sectors like education, drones, and ride-hailing.

 Harry holds his own ▶ 16:35 Citing specific market deals and portfolio companies

Harry demonstrates domain expertise by citing Founders Fund's investment in Leafly and DCM's investment in Ease to set up a targeted question.
the scores for every segment, with the reasoning behind each
ChapterTopicHarry as informed peerGuest teachingGuest disagreementHarry pushing backWhy
Kyle Lui's Career Path and Learning to Code 2301 Harry asks friendly, standard career entry questions about Kyle's transition from finance to tech and learning to code. Kyle explains his career path and educates Harry on learning Python via online resources like Learn Python the Hard Way.
Choice Pass Acquisition by Salesforce and Corporate Culture 2312 Harry inquires about the emotional and operational aspects of selling Choice Pass to Salesforce. Kyle gently reframes Harry's suggestion that Salesforce was the only option for growth, explaining the appealing strategic alignment instead.
Startup Challenges, Pivots, and Employee Incentives 2301 Kyle shares the story of Choice Pass pivoting from a daily-deals competitor to an enterprise rewards platform. Harry links this background to Kyle's investment in AnyPerk, allowing Kyle to detail his thesis on employee retention in Silicon Valley.
Investment Strategy and Startup Evaluation Criteria 3423 Harry presses Kyle on specific investment criteria, asking whether college degrees are required and challenging Kyle's prioritization of team with 'Team over product?'. Kyle counters that degree requirements are not strict and firmly defends why team always supersedes product.
Navigating Regulatory Risk in Medical Marijuana Investments 4412 Harry demonstrates industry knowledge by citing Leafly and Ease while asking about regulatory risks in medical marijuana. Kyle broadens the context, explaining that VCs routinely evaluate regulatory risks across tech sectors like drones and ride-hailing.

Statements from this episode (7)

Disclosure
Salesforce was Choice Pass's top acquisition target from day one
“Everybody was really excited about like Salesforce as a company, and when we started, we sort of looked at, you know, companies that we admire, companies that we'd like to partner with, potentially get investments from, or potentially be acquired by, and Sales…”
Kyle Lui Feb 23, 2015 ▶ 5:19
Prediction Not checkable as stated
AnyPerk is well positioned to own the employee perks market
“And I think that they've done a really good job of executing, of delighting their customers, and I think they're well positioned to really own this market.”
Kyle Lui Feb 23, 2015 ▶ 11:04
Disclosure
DCM sometimes meets founders a dozen times before investing
“Sometimes we meet entrepreneurs you know, maybe a dozen times, you know, to talk about everything from strategy, go to market, product, vision, hiring, before we make an investment.”
Kyle Lui Feb 23, 2015 ▶ 12:15
Disclosure
Lui focused on mobile on-demand, drones, AI, and enterprise in 2015
“Me, personally, I've been looking, ah, a ton into Mobile-enabled services, so sort of the on-demand space. I've also been actively looking at drones and the drone space and AI, which is quickly emerging and as you, and also obviously enterprise software, given…”
Kyle Lui Feb 23, 2015 ▶ 14:17
Insight
Venture capital is a commodity requiring sector expertise to win
“Capital is a commodity. There's so many different sources of capital now that you need to really provide things that are different, and I think that having that difference you know, having that industry knowledge is, is, is quite important.”
Kyle Lui Feb 23, 2015 ▶ 14:47
Insight
Venture capitalists must actively assume regulatory risk in emerging markets
“VCs generally have to take, ah, a bit of regulation risk, right? You either make a call that regulation is going in, in the direction that's favorable towards, towards you know, the potential investments you're looking at, or they're not.”
Kyle Lui Feb 23, 2015 ▶ 17:04
Disclosure
DCM invested in Eaze following a multi-decade shift in cannabis regulation
“We as a DCM, as a fund, really saw that, ah, regulations were shifting in a way that we hadn't seen in the last couple of decades, and so this led to a real market opportunity for innovators, and I think Ease is certainly one of them.”
Kyle Lui Feb 23, 2015 ▶ 17:57
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