Nov 21, 2025 · 1h 19m · 20vc
20VC: Max Altman on The New Seed War: Can Anyone Compete with Sequoia and a16z | Leaving $2BN on the Table with Reddit | Lessons from Backing Rippling at $25M Post | Why Climate Tech is a Mirage and Disaster
0:00 / 0:00
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of 20VC, Max Altman, co-founder and managing partner of Saga Ventures, shares insights from his venture career spanning Hydrazine Capital, Apollo Projects, and Saga Ventures. He discusses lessons from early investments in Rippling and Reddit, outlines Saga's boutique seed strategy and AI thesis, and reflects on building an independent identity alongside his brothers.
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 37.9% of the talking time here. How this is scored →
Harry as informed peer 4.7 Guest teaching 4.2 Guest disagreement 3.2 Harry pushing back 4.0
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 27:44 Max rejects the premise that US seed is for suckers
When Harry forcefully claims that seed investing in SF is for suckers due to dominant multi-stage firms, Max directly rejects the premise, offering counter-data on recent AI unicorn leads.
Hardest push from Harry ▶ 1:02:38 Harry challenges the viability of middle-generation boutique seed firmsHarry refuses to accept Max's optimistic framing about boutique seed firms coexisting with multi-stage funds, pushing back that new firms are actively replacing older seed players.
Biggest teaching moment ▶ 26:35 Max explains why competing at Series A against Sequoia is impossibleMax educates Harry on why seed funds lose Series A leads, recounting a specific email from Sequoia's Mike Vernal listing six top private board seats and IPOs.
Harry holds his own ▶ 1:06:10 Harry breaks down fund duration math vs headline multipleHarry demonstrates strong fund economics expertise by highlighting that a 4x DPI fund over 17 years yields equivalent annualized returns to a 2.6x fund over 10 years.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Midwestern Roots and Early Venture Capital Days | 3 | 3 | 2 | 2 | Harry introduces Max Altman and discusses his Midwestern roots versus San Francisco VC culture. The tone is relaxed and warm, with light banter about VC 'tourists' and mutual friend Keith Raboi. | |
| Lessons from Zenefits and Parker Conrad | 4 | 3 | 2 | 3 | Max shares lessons from working under Parker Conrad at Zenefits, highlighting product intuition and growth over culture. Harry interjects with insights from Revolut's founder, creating a balanced peer exchange on leadership mindset. | |
| Navigating Sibling Dynamics and Building an Independent Identity | 3 | 2 | 2 | 3 | Harry probes Max on building an independent career identity separate from his famous brother Sam Altman. Max candidly acknowledges that ego and personal pride drove him to start his own firm without family reliance. | |
| Hydrazine Capital, Early Wins, and Exit Reflections | 5 | 4 | 3 | 4 | Max details Hydrazine Capital's early bets on Rippling and Reddit, admitting that leaving billions on the table by selling Reddit post-lockup altered his thinking. Harry pushes on post-IPO holding strategies versus distributing shares to LPs. | |
| Apollo Projects, Hard Tech, and Climate Tech Challenges | 5 | 5 | 4 | 4 | Max discusses Apollo Projects, acknowledging that climate tech investments failed to yield VC returns because they rely on carbon credits rather than core business fundamentals. He explains why competing at Series A against Sequoia's brand advantage made him pivot purely to seed. | |
| Launching Saga Ventures and Operating from Austin | 6 | 6 | 6 | 6 | Harry provocatively asserts that seed investing in SF is for suckers due to multi-stage domination. Max directly rejects the premise using market data showing multi-stage firms only captured one lead check across recent AI unicorns. | |
| Fund Construction, LP Strategy, and Pro Rata Realities | 6 | 5 | 4 | 5 | The conversation turns to Saga Ventures' fund size, LP dynamics, and pro rata rights. Harry and Max debate whether pro rata is a strict legal right or an earned moral entitlement when top-tier funds lead subsequent rounds. | |
| Preemption, Clean Series A Processes, and Tech Policy | 5 | 4 | 3 | 4 | Max outlines how he coaches founders on managing preemptive offers and running clean Series A processes. They briefly touch on political developments and immigration policy where Max criticizes restrictions on technical talent. | |
| AI Thesis, Second-Order Opportunities, and Public Relations | 5 | 5 | 3 | 5 | Harry challenges Max on whether his family connection with Sam Altman grants him privileged insight into OpenAI's roadmap. Max insists he maintains strict professional boundaries to earn success on his own merit and avoid compromising his brother. | |
| The Changing VC Landscape and Long-Term Vision | 6 | 5 | 3 | 5 | Harry presses Max on whether boutique seed firms from prior generations are being squeezed out by multi-stage players and new entrants. Harry demonstrates strong industry knowledge regarding fund duration and internal rate of return drag. | |
| Quick Fire Round | 4 | 4 | 3 | 3 | In the quick-fire round, Max reflects on passing on Hadrian, lessons from Sam on human motivation, and overcoming stage fright to step into public leadership. |
Statements from this episode (34)
Altman: Scaling Silicon Valley venture capital degraded interpersonal trust among VCs
“There are still some. There are less. I think when I got there in San Francisco in 2013, it looked a little more like a small, smaller town, maybe Austin or St. Louis, where everyone really trusted everybody. And had deep connection, and naturally it's grown. …”
Max Altman calls Keith Rabois the smartest non-family VC investor
“Keith Raboy. I mean, whatever people want to say about him, I think he's extremely smart.”
Max Altman calls Parker Conrad the best sales and product leader
“He's crazy, but he's the best salesperson and the best product person that I've ever met in my life.”
Altman: Founders Must Rely on Intuition Over Customer Requests
“The founder needs to have intuition of what they want. The customers aren't going to know.”
Tech workers should ignore mission and join the fastest-growing company
“Don't care about the product, don't care about anything, just go work at the fastest growing company because winning feels great.”
Parker Conrad unfairly took the fall for non-ethical Zenefits mistakes
“I think there were some small mistakes made, but they were company-wide. They were under all departments, not just his. Everyone knew about it. They weren't ethical mistakes, and he sort of, you know, took the fall.”
Max Altman left family funds to launch Saga Ventures out of ego
“So I, you know, I left after doing three funds with some combination of Sam and Jack to build out my own firm just for ego and pride, to be completely honest.”
Max Altman says Hydrazine Capital generated approximately 17 unicorn companies
“You know, I think we had about 17 unicorns across the fund, because it's just a small world, and everyone's coming by, so I'm like, oh, these are the founders of Instacart, or Reddit, or Rippling, or Boom, and it's like, this is the bar.”
Altman: Hydrazine Capital backed Rippling at a $25 million valuation
“It was give money to the best people. You know, we did Reddit at a higher valuation. We did rippling at 25.”
Altman: Traditional VC firm hierarchies distort associate incentives away from fund returns
“I don't know if they're fucked up cultures, but I don't think they're incentivized to have the best returns. If you're an associate at a firm, and you're maybe there for five or six years, your job is to get a deal done that's gonna get marked up quickly so yo…”
Altman: Successful startups must target at least the entire US market
“Yeah, and I do believe that the majority of the best companies are going to be built from San Francisco, but the people need to be a little bit outward looking in what they're building, because Your market better be the entire United States at a minimum to be …”
Hydrazine Capital missed $2B by distributing Reddit stock post-lockup
“It was about nine billion when the lockup ended. That was tough. I think the market cap's about thirty-nine billion now. I think it's pretty public. The fund owned just about seven percent. You can do the math. That's about maybe two billion of gains that coul…”
Altman: Saga Ventures will consult anchor LPs on post-IPO share distributions
“Yeah, I believe that, and I think, yeah, moving forward, it's just gonna be call your anchor LPs and say, let's talk through how we want to handle the situation.”
Max Altman predicts climate tech startups will not produce great VC returns
“Yeah, I think we wanted to be somewhat involved with it, and there were a lot of amazing founders building in it, and they're gonna build great things, but they're not gonna get us great VC returns.”
Max Altman: Seed funds competing for Series A face adverse selection
“I'm clearly gonna Lose the deals that I want to lose, and if I win them, it's probably not the ones that I want.”
Harry Stebbings says seed-stage investing in San Francisco is for suckers
“I think seed in SF is for suckers.”
Andreessen Horowitz led only two seed rounds for billion-dollar AI startups
“Of the first 40 of them, only one person had two lead checks, and that was Andreessen, and no one else had two, and if you look through the smattering, there are, you know, Green Oaks is in there, a lot of Gill's in there, but there's a lot of other random peo…”
A seed lead only taking pro rata in Series A signals failure
“I fully believe if they're like, hey, Sequoia led our seed, and I'm like, hey, are they doing your A, and they're like, Well, they're doing their pro rata. I'm like, this is not a good company. Like, objectively is not a good company.”
Max Altman predicts numerous $100B AI startup exits by 2033
“Like, not to be on the AI hype train, but I do think we are going to have a lot of exits Eight years from now, around the hundred billion dollar mark.”
Altman: Founders care about investor portfolio prestige, not check size
“And founders don't care if you did a 25 K check or a million dollar check at the seed. They just think that you've invested in the best companies.”
Max Altman says his earlier venture funds achieved 4x DPI
“I was fortunate enough to have data from the earlier funds to say, we've absolutely crushed it, and we're now at like about four X DPI. I think we can get to five or six, and we knocked it out of the park.”
Altman advises seed funds to model receiving only 70-80% of pro rata
“So I think a lot of the times that I've learned is like, hey, model in the pro rata, but you're only gonna get 70 or 80% of it.”
Founders should always accept an investment offer from Sequoia Capital
“I think it's really hard if you get Sequoia to offer you money and be on your cap table and have that amazing brand halo effect to not take it, and I think someone always should.”
Altman: Lead Series A VCs walk away if non-leads pre-fill two-thirds of the round
“People do these wonky things where they're like, we raised five from this person, and we have this thing soft-circled, and then you get to your lead, and they're like, there's only room for us to do under half of this deal. We're out. And I'm like, don't do th…”
Altman: Capital supply grew 10x while top-tier startups only grew 2-3x
“There's now like hundreds of billions of capital chasing slightly more companies. I think the experiment we're going through right now and went through in 2020 is like, hey, if we put 10 times as much capital into the market, there better be 10 times as much g…”
Max Altman calls H-1B restrictions the worst US tech policy decision
“Maybe, maybe the worst decision related to tech that this administration has had. Like, first off, why would you not want an amazing engineer immigrating to your country? Just like, straight up, we want all of the best, smartest people going to work in our cou…”
Altman: Building products close to OpenAI's roadmap is naive
“If you have, like, the naivety to think you're gonna build something that's really close to what OpenAI is building, And they're not going to build it. You're crazy. Like, you know what I mean? So I think we've really stayed away from things that OpenAI will e…”
Max Altman avoids asking brother Sam Altman for OpenAI roadmap leaks
“I don't want to put him in a weird position where he's leaking anything. It just, it doesn't seem like good for OpenAI, and it doesn't feel good. Like, I kind of want, and you might say this is stupid, to like, earn this on my own right.”
Altman: Mid-sized $700M VC funds face severe structural challenges
“I think it's really challenging to be like a seven hundred million dollar fund. Now I think you're either a really massive, powerful platform like an Andreessen or a GC Or you just have the legacy cachet, like a Sequoia or a Kleiner, or you have to be a boutiq…”
Altman: Seed VCs have a 15-year window before being replaced
“Yeah, we have to compete with them, we have to do better than them, there's not room for all of us, and Frankly, I kind of think, Harry, you were younger when you started, so you might have a little more time. I got, like, 15 years of this until I'm really goo…”
Max Altman admits holding Gusto past its $10B valuation was a mistake
“It might not have hurt to sell Gusto. I think Gusto's a great business, but I think, you know, they were valued at ten billion at one point, and I think they're still gonna be a strong business. I don't know if they're gonna have explosive growth from there.”
Altman: Saga sold Rippling shares early to return capital to LPs
“Rippling and Reddit. We sold a little bit of rippling on the way up, just because, like, our LPs wanted money and, you know.”
Altman: Venture capital is a cutthroat market, not a collaborative environment
“I think that it is, people say it's this sort of chummy, like, collaborative thing where we're all kumbaya and having fun, and then, like, You know, you get to it, and someone just, like, elbows you out of the way. It's not. It's a competitive market. We're al…”