Apr 3, 2025 · 1h 27m · 20vc
20VC: The Daily Deal: Coreweave IPO | Scale Hits $25BN on $2BN EOY Revenue | Sequoia's 25x Return on Wiz | Tech Stocks Tank with Tariffs | Cursor: Defensible or Dangerous Example of Lost Moats in Tech
Jason Lemkin · 29m spoken Harry Stebbings · 18m spoken Andrew Feldman · 16m spoken Bhavin Shah · 13m spoken
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Hosts Harry Stebbings and Jason Lemkin examine venture capital trends, tariff market impacts, AI's disruption of SaaS revenue durability, and enterprise M&A dynamics, complemented by guest interviews with Moveworks CEO Bhavin Shah and Cerebras CEO Andrew Feldman Feldman.
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 22.5% of the talking time here. How this is scored →
Harry as informed peer 5.3 Guest teaching 4.9 Guest disagreement 2.0 Harry pushing back 3.0
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 18:50 Jason attacks YC's tight process advice
Jason forcefully rejects Y Combinator's conventional wisdom of running a tight fundraising process, labeling it some of the worst advice given to founders outside the top 0.1%.
Hardest push from Harry ▶ 51:36 Harry refutes Jason's timeline on mega-IPO candidatesHarry directly challenges Jason's confidence that Canva and Figma must IPO within 18 months, highlighting how strong private secondary markets provide liquidity without going public.
Biggest teaching moment ▶ 57:10 Andrew details chip design and fab capital requirementsAndrew educates Harry on why young founders struggle in hardware, breaking down million-dollar tool licensing, backend design, and multi-million-dollar fab NRE fees.
Harry holds his own ▶ 13:36 Harry presents multi-decade LP return dataHarry demonstrates deep institutional knowledge by citing an LP study showing venture returns rely heavily on taking advantage of rare 6-to-12-month selling windows.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Tariff Market Impact and the Golden Age of Software | 5 | 3 | 1 | 2 | Harry introduces the episode topic on tariff-driven market drops and prompts Jason with Thoma Bravo's analysis regarding software spend doubling to 4% of GDP. Jason frames this as the beginning of the golden age of software despite current market stresses. | |
| Revenue Durability and High Valuations in AI | 5 | 5 | 2 | 3 | Harry brings up high-profile AI deals like Cursor at a $9.6B valuation to challenge traditional revenue durability metrics. Jason explains how VCs have shifted from evaluating historical durability to pricing deals on next-year growth projections. | |
| AI Growth Rounds, Momentum Investing, and Time to Liquidity | 7 | 4 | 1 | 2 | Harry demonstrates strong domain expertise by citing specific LP return data showing venture liquidity only works well in narrow 6-to-12-month windows. Jason agrees and notes how momentum investing allows growth VCs to optimize for fast markups over long duration holds. | |
| Fundraising Strategies for SaaS Founders in an AI-Driven Market | 5 | 5 | 5 | 3 | Jason aggressively rejects Y Combinator's standard advice of running a tight fundraising process for traditional SaaS founders, calling it terrible advice unless in the top 0.1%. Harry asks clarifying questions on how SaaS founders should package themselves in an AI-dominated market. | |
| Unmasking Fake AI Growth, VC Due Diligence, and Productivity Gains | 5 | 5 | 2 | 3 | Jason details examples of fake AI growth where human prompts or basic ChatGPT wrappers generate millions in revenue without actual software defensibility. Harry questions VC due diligence standards and probes whether AI efficiency reduces the need for venture capital. | |
| Moveworks CEO Bhavin Shah on $2.85B ServiceNow Acquisition | 5 | 5 | 1 | 3 | Moveworks CEO Bhavin Shah joins to discuss their $2.85B acquisition by ServiceNow. Harry presses on whether Moveworks was strong-armed into a deal due to heavy customer overlap and partnership reliance. | |
| Enterprise AI Budgets, Adoption Realities, and M&A Math | 5 | 6 | 1 | 2 | Bhavin educates the hosts on enterprise AI adoption realities, highlighting that enterprise change management and security approvals take 6-9 months regardless of tech speed. Harry asks whether AI inherently favors incumbent platforms over agile startups. | |
| The IPO Outlook, RSU Tax Cliffs, and Private Equity Reality | 6 | 4 | 3 | 6 | Harry directly challenges Jason's claim that Canva and Figma will IPO within 18 months, arguing that robust private secondary markets reduce the necessity of going public. Harry also questions the prevailing narrative that private equity will bail out stalled venture-backed software unicorns. | |
| Andrew Feldman on Chip Design, CoreWeave IPO, and Defense Tech | 5 | 7 | 2 | 3 | Andrew Feldman educates the hosts on chip architecture, fab relationships, and the high cost of silicon design, explaining why 19-year-olds rarely succeed in hardware. He also breaks down the complex contracting barriers and zero-trust procurement structures when selling tech to the military. |
Statements from this episode (33)
Lemkin: Public B2B SaaS companies averaged 70% growth in 2021
“The average public B to B stock was growing 70% in 2021. Public. I'm not talking about Cursor, or I'm talking about moldy oldies. The moldy oldies of SaaS were growing 70% in twenty-twenty-one.”
Lemkin: Software expanding to 4% GDP will create 100+ decacorns
“I do believe if this trend of software going from two percent to four percent of GDP that they point out, that, that's going to birth a hundred decacorns, a hundred or more, and it is the golden age of software.”
Lemkin: Zoom is currently experiencing zero percent revenue growth
“But Zoom isn't, Zoom is growing zero percent now, right?”
Lemkin: Investors will stop assuming software revenue is durable by 2026
“This assumption is going to fade away by next year. We will no longer think any revenue is durable.”
Stebbings: Cursor recently raised funding at a $9.6 billion valuation
“Cursor obviously just raised, I think it was a 9.6 billion dollar valuation.”
Lemkin: Breakout AI companies are cheaper on revenue multiples than seed deals
“But in some ways, these crazy AI deals, once they take off are the cheapest from a revenue multiple perspective compared to like seed and a deals.”
Lemkin: Real venture fund liquidity now takes 20 years
“To get to this phase. And so it's really 20 years. It's not just 15. It's 15, and then you have to IPO, and then it's three years to distribute, right? But after six months, so we're talking about 20 years to real liquidity, to a real fund.”
Lemkin: Nearly all his venture liquidity occurred in 2021
“So all, as an investor, all my liquidity was basically in twenty-twenty-one.”
Lemkin: Pro-M&A Trump policies will trigger a golden age of tech M&A
“So there's going to be a wave of more M&A, right? Especially if, you know, pros and cons looking at the stock market, but if Trump remains pro M&A, You know, as long as your pesky Europe doesn't get in the way this is going to be a golden age of M&A. Like, jus…”
Lemkin: 80% of B2B VCs reject traditional SaaS growth deals today
“For B to B investors that you and I know well, I mean, you know, everybody, Harry, but I would say 80% of them won't touch a triple, triple, double, double deal today.”
Lemkin: YC advising founders to run tight fundraising processes is terrible advice
“I think it's some of the worst advice founders get. And I love Y Combinator, but I think it's some of the worst advice Y Combinator gives their founders too, which is run a tight process.”
Lemkin: OpenAI expects no profitability until reaching $127B in revenue
“I mean, open AI said they're not going to be profitable until one hundred and twenty seven billion in revenue. A hundred and twenty seven billion.”
Lemkin: RevenueCat doubled internal productivity using Cursor AI tools
“I, there's no question that I mean, RevenueCat, we're both an investor, did an analysis recently, and they got about 50%, two extra productivity using AI tools, about two extra productivity using Cursor and Codip.”
Lemkin: RevenueCat powers subscription infrastructure for 40% of mobile apps
“They're 40% of all mobile apps running RevenueCat.”
Lemkin: AI software startups have no moats and must run faster
“What, and there's, and this is an age in AI where there's no moats. So if there's no moat, you better run faster.”
Lemkin: Moveworks was acquired for over $2 billion
“That's why Moveworks is acquired for two and a half, two something billion dollars.”
Shah: 250 of Moveworks' 350 customers overlap with ServiceNow
“Just for the sake of numbers, it's 250 out of 350 customers that are ServiceNow customers, so quite a bit of overlap.”
Shah: Time savings represent weak ROI compared to process transformation
“To solve, not just like employee productivity, which is sort of what I call weak ROI. It's like you say Bob in three hours a week, who cares? You're still going to pay my salary, but the real you know, strong ROI is where you could actually transform core busi…”
Shah: Enterprise AI discussions in two years will focus on adoption pace
“From the enterprise standpoint, exactly what we're talking about right now, which is, you know, the adoption curve and getting things in and moving things along. Again, we've seen this where customers absolutely are ready to go, but just their own internal pro…”
Shah: Moveworks is the first agentic AI platform to receive FedRAMP authorization
“We just got FedRAMP authorization two months ago, the first agentic platform to get that because we had to build a lot of the security measures, the protocols, the infrastructure on gov cloud and this and that, that it just takes time.”
Shah: Enterprises established dedicated AI line-item budgets starting in early 2024
“I will say that at the start of 24, we started to see solid numbers inside of budgets for people to deploy AI systems, agentic systems to help their employees to drive business transformation. It wasn't just coming out of a slush fund or you know kind of a one…”
Lemkin: Most tech IPOs trade flat two years post-listing
“Most tech IPOs are flat two years out, so why would you buy in the IPO, right?”
Lemkin: Stripe, Figma, Chime, and Canva will IPO within 18 months
“Stripe, Figma Chime, the list of folks north of five hundred million, ok, Canva, three billion, that are gonna IPO in the next 18 months.”
Lemkin: Expiring RSUs force late-stage tech IPOs more than investor liquidity
“A lot of that is driven by taxes in the US. It's not really driven by liquidity for investors. It's driven by this brutal tax situation of RSUs expiring. They're expiring on employees and they're becoming taxable events before the IPO.”
Lemkin: Private equity acquisition interest in mid-tier SaaS has evaporated
“I'm not seeing the type of just tire kicking that I saw a year ago. I'm not seeing it. I'm not. Maybe other people with broader portfolios will tell you different. That's what worries me. I don't know. We're waiting for P to bail us out. Right. Forget about th…”
Feldman: Cerebras pays millions in software tools and $20M-$30M NRE per fab
“We pay millions of dollars a year in tools, selection of geometry, right? Which fab and having a relationship with a fab, you're going to pay 20 or thirty million in NRE.”
Feldman: Hardware startups require experience, unlike consumer tech
“It hasn't historically rewarded. 19 and 20 year olds. Where, where, where the market has rewarded extreme inexperience is where they look like the customer, right?”
Feldman: CoreWeave pioneered borrowing against GPUs as debt collateral
“Many of their innovations are in the financing structure. They were among the first to use the type of debt that they're using to recognize that you could borrow against GPUs and use their access to leverage advantage.”
Lemkin: CoreWeave's late investors hold a 70% two-year stock buyback put option
“The last round investors. Obviously they weren't fully aligned on the price, right? And so there's structure and I don't think this is a bad thing. It's okay for late stage investors to be more conservative on price than founders. Like, and so they agreed on a…”
Feldman: DoD procurement is built for prime contractors, not tech startups
“One of the real challenges in, for our Department of Defense is their procurement structure is designed for them to buy without trust from Lockheed Martin.”
Feldman: Defense startups require leaders with deep existing domain experience
“It's not an accident that the people who've had success have done it before. And you don't have to be the founder who's done it before, but your co-founder could, or your head of sales needs to, or your COO needs to, you need to find people who have built a ca…”
Feldman: Cost-plus government contracts misalign incentives and destroy trust
“Cost plus is it sounds like a good path, but it is a terrible way to do business. It's a way of business that says, we don't trust you, and you're going to slam as much cost as you can into the cost side, and we're going to try and run around and make rules ab…”