Jun 22, 2016 · 31m · 20vc
20VC: Why Bots Are The New Black, Conversational Interface Is The Next of For Consumerisation and The Determinants Of A Successful Marketplace with Annie Kadavy, General Partner @ CRV
0:00 / 0:00
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In the 200th episode of The 20 Minute VC, host Harry Stebbings interviews CRV General Partner Annie Kadavy to discuss venture capital evaluation frameworks, marketplace defensibility, SaaS subscription models, and emerging consumer trends in conversational interfaces.
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 26.6% of the talking time here. How this is scored →
Harry as informed peer 2.5 Guest teaching 3.2 Guest disagreement 0.8 Harry pushing back 1.2
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 18:46 Clarifying SaaS investing background
Annie gently reframes Harry's assumption about her investment focus by pointing out she rarely does core SaaS deals.
Hardest push from Harry ▶ 23:31 Questioning dataset monopolies in botsHarry pushes back on general bot optimism by raising the threat of Facebook and Google's unbeatable dataset advantages.
Biggest teaching moment ▶ 6:21 Explaining long feedback loops in ventureAnnie educates the host on the decade-long timeframe required to assess venture performance and how early-career investors must track passes.
Harry holds his own ▶ 23:31 Analyzing incumbent data advantagesHarry showcases informed domain knowledge by bringing up data moat advantages held by major tech platforms in the AI space.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Annie Kadavy's Unconventional Path to Venture Capital | 1 | 2 | 0 | 0 | Harry asks standard exploratory questions about Annie's journey into venture capital. Annie explains how she initially held biases against VC before being encouraged to look deeper into industry role models. | |
| Evaluating VC Success and Refining Investment Frameworks | 3 | 4 | 1 | 1 | Harry asks enthusiastic follow-up questions about decision-making frameworks. Annie provides detailed insight into the ten-year feedback loop of venture capital and her self-imposed tracking system for rejections. | |
| The Dynamics and Defensibility of Consumer Marketplaces | 3 | 4 | 1 | 1 | Harry guides the conversation into consumer marketplaces, stumbling briefly on a question about IP and defensibility. Annie explains that marketplace defensibility stems from liquidity and scale rather than pure UI design, citing Craigslist and Yelp. | |
| Understanding SaaS Marketplaces and Predictable Revenue Models | 2 | 4 | 2 | 2 | Harry asks about predictable SaaS revenue as a primary investment signal. Annie corrects the premise by noting she rarely invests in traditional SaaS, shifting the conversation to consumer subscription metrics. | |
| The Promise of Conversational Interfaces and Bot Technology | 5 | 3 | 1 | 3 | Harry demonstrates strong industry context by challenging the bot trend with an thesis on incumbent data dominance. Annie validates his argument regarding Facebook and Google before outlining how startups can target high-value verticals. | |
| Quick Fire Round: Mentors, Books, and Recent Investments | 1 | 2 | 0 | 0 | A rapid-fire series of personal questions regarding mentorship, books, and recent portfolio additions. The interaction is warm and informal with no conflict. |
Statements from this episode (13)
Kadavy: Top Midas List Investors Don't Fit Traditional Operator Mold
“And after I went and looked around, I found that many of the best investors out there, you know, if you look at the Midas list, which is one list that's put together that has a lot of extremely talented and successful investors on it, they by no means fit that…”
Kadavy: It takes ten years to know if you are a good VC
“It takes one person 10 years to know if they're good at this job or not, which is crazy when you think about it. I couldn't give you another example of a job that takes 10 years to give you that feedback.”
Kadavy: $50M in revenue is often too small for early-stage VC
“Building businesses that can do fifty million dollars in revenue. That is incredible, right? That is incredible. And it, and But unfortunately, it's not always a great fit for an early stage venture fund that is that, you know, the bar for success in a consume…”
Kadavy: Marketplace success requires prioritizing empathy with supply side first
“To find success in a marketplace is, is to truly empathize specifically with the supply side first.”
Kadavy: Nearly all marketplaces derive defensibility through scale
“Marketplaces, almost all of them are defensible by scale.”
Kadavy: Craigslist's local liquidity makes it unseatably defensible despite terrible UX
“The Craigslist user experience is terrible. However, because they have such liquidity in local markets, They're incredibly difficult to unseat.”
Kadavy: Consumer-facing SaaS marketplaces will proliferate
“We'll see more of these kind of consumer, I think of them as consumer facing SaaS marketplaces.”
Kadavy: Conversational interfaces are the next wave of consumer technology
“The idea of a non-interface interface or a conversational interface being the next wave in the consumerization of technology is, is quite interesting.”
Kadavy: Great consumer tech either mirrors offline behavior or gives superpowers
“Many of the greatest companies we know could fall into one or perhaps two buckets of In what they've enabled for consumers. One is that they have enabled them to behave more as we behave as humans offline... The second is piece of technology that Give someone …”
Kadavy: AI bots will exist everywhere across existing platforms, not standalone
“My hypothesis is that at least at the beginning for sure, and I think going forward, they will live everywhere. One bot, I should think of a bot like I think of a contact person. It should be in my contact list. It should be in my Facebook messenger. Maybe it'…”
Kadavy: Facebook and Google hold a massive data advantage in AI bots
“I absolutely believe that. I think that you look, you just look at this sheer scale of Facebook Messenger and Google specifically. And while I think that others may be able to compete, the scale is, is just so vast.”