Nov 2, 2016 · 28m · 20vc
20VC: Why You Have To Be A Good Long Term Actor To Succeed in VC & How Owning An Esports Team Could Be A $Bn Outcome with Clinton Foy, General Partner @ Crosscut Ventures
0:00 / 0:00
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
On episode 197 of The 20 Minute VC, Crosscut Ventures General Partner Clinton Foy shares his transition from video game executive to venture capitalist and explores the power of authentic, relationship-driven investing. He also offers an in-depth look at the commercial explosion of esports, highlighting demographic shifts, franchise valuation potential, and emerging platform trends.
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 33.7% of the talking time here. How this is scored →
Harry as informed peer 2.5 Guest teaching 3.1 Guest disagreement 1.5 Harry pushing back 1.4
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 21:55 Calling Out 'E-Gaming'
Clinton playfully interrupts Harry to reject his phrasing of 'e-gaming', asking if Harry is taking the piss out of him.
Hardest push from Harry ▶ 15:26 Challenging Venture Returns for Esports TeamsHarry explicitly questions the core investment thesis of Immortals, asking whether owning a team can genuinely produce a billion-dollar outcome.
Biggest teaching moment ▶ 15:53 Esports vs NBA Valuation MasterclassClinton re-educates Harry on sports monetization by comparing esports to 1980s NBA franchise acquisitions and highlighting massive digital audience reach.
Harry holds his own ▶ 11:46 Brad Feld Email Response KnowledgeHarry demonstrates personal knowledge of VC networks by correctly guessing Brad Feld as Clinton's mentor and citing his legendary 15-minute response time.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Welcome and Greetings with Clinton Foy | 1 | 2 | 1 | 0 | Harry introduces Clinton warmly and asks about his transition from COO at Square Enix to VC. Clinton shares a candid story about being blocked by VCs from an early Oculus angel round. | |
| Operational Lessons and Adjustments in Moving to VC | 2 | 2 | 0 | 1 | Clinton answers LP questions regarding operational empathy and VC adjustments, describing the high volume of deal flow Crosscut reviews. Harry interjects briefly to probe what makes the shift harder. | |
| Building Authentic Networks and the Future of VC | 3 | 3 | 2 | 2 | Harry asks if VC is a market of bullish predators and explores market inefficiencies. Clinton reframes the dynamic, arguing that long-term success in VC requires being a good actor and building authentic relationships. | |
| Examples of Mentors and Authentic Relationship Builders | 3 | 1 | 0 | 0 | Clinton mentions Fred Wilson and Brad Feld as mentors in relationship building. Harry shows insider familiarity by predicting Brad Feld and highlighting Feld's rapid 15-minute email response times. | |
| Founding and Investing in the Esports Team 'Immortals' | 2 | 2 | 0 | 1 | Clinton details founding the esports team Immortals while at Crosscut and balancing VC duties with launching the organization. | |
| The Potential for $1 Billion+ Outcomes in Esports | 4 | 6 | 2 | 4 | Harry directly challenges whether investing in an esports team can offer a venture-scale billion-dollar return. Clinton schools him with a detailed historical comparison to 1980s NBA team valuations and modern digital streaming distribution. | |
| Esports vs. Traditional Sports and Demographic Shifts | 3 | 5 | 3 | 2 | Clinton makes the bold claim that traditional sports like baseball face demographic time bombs, whereas youth viewing habits heavily favor streaming platforms and esports. | |
| Quickfire Round: Blogs, Industry Challenges, SpaceX, Books & Investments | 2 | 4 | 4 | 1 | In the quickfire round, Clinton jokingly calls out Harry for saying 'e-gaming' instead of 'e-sports'. He goes on to share thoughts on publisher power dynamics, SpaceX, and recent fund investments. |
Statements from this episode (13)
VCs blocked Clinton Foy from investing in Oculus's angel round
“I tried to get in on the angel round of investment in Oculus right after their Kickstarter. I thought, well, I'm the COO of Square Enix, this two billion dollar company. Surely I can get in. And I talked to the lawyers and talked to some of the people doing th…”
Crosscut Ventures evaluates 3,000 deals annually to invest in 10 to 12
“We saw over 3000 deals this last year, and of those 3000, we met with 400 of them face to face, brought them into our office, and you know, we only ended up investing in about 10 to 12 of them.”
Aggressive, short-term VCs eventually get forced out of the ecosystem
“I don't I think it's a market of bullish predators because I think those bullish predators get forced out of the system. I think you can be a short-term predator, but to be a good VC, I think you have to be an excellent long-term actor.”
VC remains inefficient, letting investors win deals on relationships over price
“I see VC as being one of those last industries, one of those last categories that's inefficient still. And what I mean by that is it's not like the public markets where the highest bidder is always going to win. I think VCs through relationships, through vario…”
Y Combinator is disrupting venture capital by flipping founder supply and demand
“I think it will. We're starting to see that happen with Y Combinator. There was a great article I just read Profiling Sam Altman in the New Yorker, and I respect what Y Combinator has done, and I'm a big fan of what they've done over the last three to four yea…”
Foundry Group's Brad Feld responds to every email within 15 minutes
“Brad was going to be the one who I said because he, you know, he responds to every email and he responds in like 15 minutes.”
Esports team franchises could reach billion-dollar valuations over time
“I think the prize pool isn't in and of itself a billion dollar outcome, but I think owning and operating and growing an esports team and a franchise and a platform could potentially be a multi-hundred million dollar or even a potential billion dollar outcome o…”
League of Legends finals drew 36 million viewers, topping the NBA Finals
“Thirty-six million people watch the League of Legends finals this last year. That's bigger than the NBA finals.”
The average MLB fan is 54, with viewership dropping 3-4% annually
“If you look at, for instance, baseball. Baseball, the average fan of baseball is about 54 years old and male, and aging every year. The average demographic increases every year, and that, that, that fan next year will be 55, and it's decreasing on a viewership…”
Esports viewership and engagement are growing 20% to 30% per year
“But you're seeing things like eSports increasing 20 to 30% per year in viewership and engagement, and you have this amazing demographic of 14 to 24 to 34 year olds who are just starting to change viewing habits in a pretty fundamental way.”
Esports will supplant some traditional sports, though basketball and soccer will survive
“And I think that that demographic is going to supplant some traditional sports. And I think some are going to survive. I think, for instance, basketball and soccer are two very healthy international sports that are going to do very well.”