The Exchanges

Q And often funds are labeled with the term early stage. So what do you really interpret as early stage? What does that really mean in today's VC economy?

A Yeah. So, uh, it's true. Um, it's a widely abused term, like so many things in our industry. I think for entrepreneurs, what is a good guide is always looking at the fund size. So you can say that you're, uh, an early stage firm or you focus on early stage, but if you You've got this huge, big fund, you know, it, it will never be, um, it, it can never be a core part of your strategy and, and allocation and resources and these kinds of things. So, you know, BlueYard is a hundred and twenty million dollar fund and we're focused on seed and a, you know, you write tickets from a couple hundred K up to say five, six million maximum as a first ticket. So that puts us squarely in the early stage bucket. And I think again, for entrepreneurs, the best way to figure out is just to Ask VCs, well, you know, what percentage allocation of your fund goes to those kind of ticket sizes, and if that's a majority, then they're an early stage firm, and if not, they're not.

AI assessment note: “for entrepreneurs, what is a good guide is always looking at the fund size.”

Q And often funds are labeled with the term early stage. So what do you really interpret as early stage? What does that really mean in today's VC economy?

A Yeah. So, uh, it's true. Um, it's a widely abused term, like so many things in our industry. I think for entrepreneurs, what is a good guide is always looking at the fund size. So you can say that you're, uh, an early stage firm or you focus on early stage, but if you You've got this huge, big fund, you know, it, it will never be, um, it, it can never be a core part of your strategy and, and allocation and resources and these kinds of things. So, you know, BlueYard is a hundred and twenty million dollar fund and we're focused on seed and a, you know, you write tickets from a couple hundred K up to say five, six million maximum as a first ticket. So that puts us squarely in the early stage bucket. And I think again, for entrepreneurs, the best way to figure out is just to Ask VCs, well, you know, what percentage allocation of your fund goes to those kind of ticket sizes, and if that's a majority, then they're an early stage firm, and if not, they're not.

AI assessment note: “what is a good guide is always looking at the fund size”

Q And you spoke about funds not working out there, but you've also seen a lot of startup journeys and trajectories. So in your experience, what are the main reasons you've seen startups fail in the very early days of, of, of being in existence?

A Yeah, you know, it's, it's so hard. There's obviously lots of obvious things, you know, where you just built the wrong product, or product quality, or the team fell out, or these kind of things, you know, where it gets a little bit more granular is the thing of, I think, teams being brutally, brutally honest, and brutally, brutally fast in figuring out how much customers and users really like their product. And being very, very honest and tough with saying, no, this doesn't work, next, next, next. So, you know, I have done a fair amount of seed investments, and I would say that looking at seed and going to A, the more fluid and brutally honest teams are with themselves and how good their product is and the willingness to make extreme iterations, even if it means canning literally every line of code. That I've found to be a recipe for success in your DNA. But then unfortunately, there's also things, I think there was a lot of public studies on this. Often, it's also just bad timing. And it's funny, I was, I, I had dinner with an entrepreneur, Skylar Dierman. He, he, I was actually first entrepreneur I backed as a venture partner, and he built a company called moped.com. And this is going to sound familiar. It was a kind of think about like a private Twitter-like Think cross-platform. It had the Twitter syntax. You could have channels. They even had bots. Uh, yeah, if you're thin…

AI assessment note: “built the wrong product, or product quality, or the team fell out”

Q First, I have to say a huge thank you to Chad Fowler for making the intro and making this interview possible. But now I'd like to start off by hearing a bit about you, Kieran, and how do you made your way into the wonderful world of VC?

A I think Fred Dustin of Excel said on your Podcast here that he is the worst background possible to be a VC. And I'd like to correct him and say that, no, that's actually me. Um, but over time, I actually learned that there is no good background, um, to be a good VC. And if you look at the, you know, the very best people in our industry who are a bit more advanced and have really helped sort of entrepreneurs build great companies, you can see that the range is very, very broad. So I think it depends more on your personality and your mental skillset. And, and, and also being humble and understanding your role. Um, so having said that, I actually wanted to become an airline pilot. I never thought I'd be doing this. I would, I would have considered that, you know, quite a significant life failure would have told me when I was 18 that I would be VC. Um, but, you know, I didn't get comfortable with, with kind of the lifestyle that, that, that would imply flying for an airline for your life. And so I decided to study business because I didn't know what else I wanted to do. Wasn't sure I'd stick with it. I got stuck with it. Started in investment banking and mergers and acquisitions more because it was the fashion back then. I wasn't really passionate about it. So I did that, I think for two years. Then I joined the Carlisle group, um, and did, um, sort of, uh, leverage buyouts. So we …

AI assessment note: “started in investment banking and mergers and acquisitions... Then I joined the Carlisle group”

Q And then having started Blue Yard, you have the potential to mold this completely yourself, and so what do you think are the requirements to make the best VC fund, and how are you applying them to your workings and adaptations with Blue Yard?

A Yeah, so of course, we live in the day and age where information is much more available and cheaper, and also information on how you can build a good venture firm. What I would say is that good venture firms come in all kinds of sizes and shapes, so we just pick one model, and that, that doesn't mean we don't think that other models can be successful. So I think the first thing that goes without saying, like entrepreneurs building a company, the best entrepreneurs are really, really Missionary. And they're passionate around building something that they feel has to exist. And it isn't this thing where they have a whiteboard session and say, oh, look here in the top right, there's a economic opportunity to maybe build something here and we can earn some money with this. But it's typically, yeah. So I think the best VCs I've come into, they are also just as missionary around creating not just this one fund and investing in startups, but creating a venture firm that's It stands for something that means something, means something to them, means something for the entrepreneurs. So that, so that kind of made the second choice easy, easy that we wanted it to be a thesis driven firm. We wanted to kind of help entrepreneurs build on these fundamental forces we're seeing. And so it was clear that it was going to be, um, thesis driven. And then lastly, we had learned that keeping things si…

AI assessment note: “Blue Yard is always going to be a small firm, everybody's always going to be equal”

Q And you spoke about funds not working out there, but you've also seen a lot of startup journeys and trajectories. So in your experience, what are the main reasons you've seen startups fail in the very early days of, of, of being in existence?

A Yeah, you know, it's, it's so hard. There's obviously lots of obvious things, you know, where you just built the wrong product, or product quality, or the team fell out, or these kind of things, you know, where it gets a little bit more granular is the thing of, I think, teams being brutally, brutally honest, and brutally, brutally fast in figuring out how much customers and users really like their product. And being very, very honest and tough with saying, no, this doesn't work, next, next, next. So, you know, I have done a fair amount of seed investments, and I would say that looking at seed and going to A, the more fluid and brutally honest teams are with themselves and how good their product is and the willingness to make extreme iterations, even if it means canning literally every line of code. That I've found to be a recipe for success in your DNA. But then unfortunately, there's also things, I think there was a lot of public studies on this. Often, it's also just bad timing. And it's funny, I was, I, I had dinner with an entrepreneur, Skylar Dierman. He, he, I was actually first entrepreneur I backed as a venture partner, and he built a company called moped.com. And this is going to sound familiar. It was a kind of think about like a private Twitter-like Think cross-platform. It had the Twitter syntax. You could have channels. They even had bots. Uh, yeah, if you're thin…

AI assessment note: “built the wrong product, or product quality, or the team fell out”

Q But you're not ruling out the potential of raising a further fund in the future, are you?

A Oh no, absolutely not. We want to earn the right to do that and not make assumptions. Um, but what we don't want to do is, is build, you know, already from the first day, assume that with Blue Yard, we have to, um, leave some kind of lasting legacy and brand. Um, cause that's where a majority of VC firms fail. So we're happy to, and I forget What U S fund did this? It may have been the foundry group where they said, Hey, you know, we're going to probably raise three or four fund generations, maybe one or two more or less or whatever. And then we're going to shut it down because, you know, we, we think succession is really hard. We're probably going to suck at it and it's not going to be the foundry group. And so, you know, let's just assume that that's going to happen. And if it doesn't happen, great. And so we're taking similar approach with blue yard where we're saying, let's just be mentally prepared and open to have this be, uh, A firm that just exists for a certain period of time, and as soon as we're not good at it anymore, or we, or we realize we're not being very good at transition, no problem, we'll shut it down, no hard feelings, and, and somebody better will take our place.

AI assessment note: “Oh no, absolutely not. We want to earn the right to do that”

Q First, I have to say a huge thank you to Chad Fowler for making the intro and making this interview possible. But now I'd like to start off by hearing a bit about you, Kieran, and how do you made your way into the wonderful world of VC?

A I think Fred Dustin of Excel said on your Podcast here that he is the worst background possible to be a VC. And I'd like to correct him and say that, no, that's actually me. Um, but over time, I actually learned that there is no good background, um, to be a good VC. And if you look at the, you know, the very best people in our industry who are a bit more advanced and have really helped sort of entrepreneurs build great companies, you can see that the range is very, very broad. So I think it depends more on your personality and your mental skillset. And, and, and also being humble and understanding your role. Um, so having said that, I actually wanted to become an airline pilot. I never thought I'd be doing this. I would, I would have considered that, you know, quite a significant life failure would have told me when I was 18 that I would be VC. Um, but, you know, I didn't get comfortable with, with kind of the lifestyle that, that, that would imply flying for an airline for your life. And so I decided to study business because I didn't know what else I wanted to do. Wasn't sure I'd stick with it. I got stuck with it. Started in investment banking and mergers and acquisitions more because it was the fashion back then. I wasn't really passionate about it. So I did that, I think for two years. Then I joined the Carlisle group, um, and did, um, sort of, uh, leverage buyouts. So we …

AI assessment note: “I decided to study business... Started in investment banking... Then I joined the Carlisle group”

Q And then having started Blue Yard, you have the potential to mold this completely yourself, and so what do you think are the requirements to make the best VC fund, and how are you applying them to your workings and adaptations with Blue Yard?

A Yeah, so of course, we live in the day and age where information is much more available and cheaper, and also information on how you can build a good venture firm. What I would say is that good venture firms come in all kinds of sizes and shapes, so we just pick one model, and that, that doesn't mean we don't think that other models can be successful. So I think the first thing that goes without saying, like entrepreneurs building a company, the best entrepreneurs are really, really Missionary. And they're passionate around building something that they feel has to exist. And it isn't this thing where they have a whiteboard session and say, oh, look here in the top right, there's a economic opportunity to maybe build something here and we can earn some money with this. But it's typically, yeah. So I think the best VCs I've come into, they are also just as missionary around creating not just this one fund and investing in startups, but creating a venture firm that's It stands for something that means something, means something to them, means something for the entrepreneurs. So that, so that kind of made the second choice easy, easy that we wanted it to be a thesis driven firm. We wanted to kind of help entrepreneurs build on these fundamental forces we're seeing. And so it was clear that it was going to be, um, thesis driven. And then lastly, we had learned that keeping things si…

AI assessment note: “we wanted it to be a thesis driven firm... Blue Yard is always going to be a small firm”

Q But you're not ruling out the potential of raising a further fund in the future, are you?

A Oh no, absolutely not. We want to earn the right to do that and not make assumptions. Um, but what we don't want to do is, is build, you know, already from the first day, assume that with Blue Yard, we have to, um, leave some kind of lasting legacy and brand. Um, cause that's where a majority of VC firms fail. So we're happy to, and I forget What U S fund did this? It may have been the foundry group where they said, Hey, you know, we're going to probably raise three or four fund generations, maybe one or two more or less or whatever. And then we're going to shut it down because, you know, we, we think succession is really hard. We're probably going to suck at it and it's not going to be the foundry group. And so, you know, let's just assume that that's going to happen. And if it doesn't happen, great. And so we're taking similar approach with blue yard where we're saying, let's just be mentally prepared and open to have this be, uh, A firm that just exists for a certain period of time, and as soon as we're not good at it anymore, or we, or we realize we're not being very good at transition, no problem, we'll shut it down, no hard feelings, and, and somebody better will take our place.

AI assessment note: “Oh no, absolutely not. We want to earn the right to do that”

Q And then applying that thesis directly to Europe, are we seeing those three key transformations really occurring in Europe at this moment?

A So I think there's a couple of things going on. If you look at the current wave of big European companies, or the wave of the last couple of years, um, you know, it takes seven to 10 years to build a big company, so these companies were founded, um, you know, seven to 10 and even more years ago, if you, if you look at some of the big names, and those were the days and age of kind of Mobile consumer applications, and e-commerce, and, you know, listings, and these kind of things, and so that went really well, um, but those days are a little bit over, and what's happening is, is that all these really great successful companies have helped create wealth, um, an ecosystem, um, and more importantly, entrepreneurial role models, um, and they've trained a huge amount of engineering talent base, and so that engineering talent base and Product people and design people, they are now leaving these big companies to start their own companies, but they are starting companies that are more engineering driven, more technical, more enterprise, more, uh, global versus, you know, uh, regional adaptations, and we're also seeing, uh, things like students, um, at technical universities that would, in the past would have loved to have worked for BMW are now saying, hey, BMW is in a Embarrassment against Tesla. So before I joined BMW, you know, I have all these entrepreneurial role models. I know there…

AI assessment note: “European ecosystem is going to geek up, um, and it's going to be much more”

Q And then applying that thesis directly to Europe, are we seeing those three key transformations really occurring in Europe at this moment?

A So I think there's a couple of things going on. If you look at the current wave of big European companies, or the wave of the last couple of years, um, you know, it takes seven to 10 years to build a big company, so these companies were founded, um, you know, seven to 10 and even more years ago, if you, if you look at some of the big names, and those were the days and age of kind of Mobile consumer applications, and e-commerce, and, you know, listings, and these kind of things, and so that went really well, um, but those days are a little bit over, and what's happening is, is that all these really great successful companies have helped create wealth, um, an ecosystem, um, and more importantly, entrepreneurial role models, um, and they've trained a huge amount of engineering talent base, and so that engineering talent base and Product people and design people, they are now leaving these big companies to start their own companies, but they are starting companies that are more engineering driven, more technical, more enterprise, more, uh, global versus, you know, uh, regional adaptations, and we're also seeing, uh, things like students, um, at technical universities that would, in the past would have loved to have worked for BMW are now saying, hey, BMW is in a Embarrassment against Tesla. So before I joined BMW, you know, I have all these entrepreneurial role models. I know there…

AI assessment note: “So we think the European ecosystem is going to geek up”

Q And I want to hear about Blue Yard now, so hit me with a bit about the fund, you know, what stage you're into, what preferences you have in terms of sectors, geographies, what's the synopsis on the fund overall, would you say?

A Yeah, um, so, um, I, I, I hope, um, we're kind of asking people to keep the congratulations for, in a couple of years, if we've hopefully managed to help some intrapreneurs, Um, because, you know, I can, I can tell you that, you know, it's, it's easy to, it's like entrepreneurs, you celebrate raising money, that's great, but after 30 seconds, you're, oh, wow, you know, look at that, you know, huge responsibility on our hands now. Blue Yard, it's a very small firm, it's, you know, Jason, myself, and then we have Chad as a venture partner, who you know, is, is a much more, A, he's a better saxophone player than we all are, and B, you know, he's a He's a tech leader, and he's a meaningful venture partner, and we wanted to create a firm that is very small, and where entrepreneurs really only deal with, with the partners, and where we can be very agile, and quick, and also where we can form the entire firm around a thesis. Um, and there's three fundamental forces, um, we think are happening, um, in society, and in economies, and we want to help entrepreneurs build companies around them. One of them is The decentralization of markets, so the reduction of the power of gatekeeping, um, uh, items, then allowing more people to transact in markets, um, allowing individuals to, um, you know, build up an economy on their own, um, and we, we think that that's going to increase and not decrea…

AI assessment note: “we wanted to create a firm that is very small... form the entire firm around a thesis”

Q And talking of a team's brutal honesty, we often hear the CEO or the chairman say, we need a, we need a world-class CTO. We need a world-class VP of marketing. So what should they be really focusing on when making those hires in the core executive?

A So I think there's, there's two things. So hopefully your board is very encouraging in terms of you spending money on people that can help increase quality of Of, of the product, the company, and, and, and grow the, the product and the company, and if you don't, then, then that, that, that's obviously a problem. Um, the one thing that the board should hopefully protect you from and, and have, give you good guidance is on hiring the, the, the wrong people, or sorry, the right people too early, because sometimes you can bring in somebody who really only works well if they have 50 engineers supporting them, two VP of engineerings below them, and, and, and they're, they're going to fail in your environment. And they're going to be frustrated. You're going to be frustrated. So I think there, there is something to be said for a sophisticated conversation, but having said that, the board should always be leaning forward on spending on people. For the team, often the, the, it can be a little bit intimidating because everybody kind of feels like a little co-founder at the beginning, and then all of a sudden you're building a hierarchy, um, and all of a sudden there's people coming in atop, and oh, these people are earning three matches. I'm As I'm earning. And I think the best entrepreneurs very early on make it clear to the team that the organization is going to change over time, and t…

AI assessment note: “give you good guidance is on hiring the, the, the wrong people, or sorry, the right people too early”

Q And talking of a team's brutal honesty, we often hear the CEO or the chairman say, we need a, we need a world-class CTO. We need a world-class VP of marketing. So what should they be really focusing on when making those hires in the core executive?

A So I think there's, there's two things. So hopefully your board is very encouraging in terms of you spending money on people that can help increase quality of Of, of the product, the company, and, and, and grow the, the product and the company, and if you don't, then, then that, that, that's obviously a problem. Um, the one thing that the board should hopefully protect you from and, and have, give you good guidance is on hiring the, the, the wrong people, or sorry, the right people too early, because sometimes you can bring in somebody who really only works well if they have 50 engineers supporting them, two VP of engineerings below them, and, and, and they're, they're going to fail in your environment. And they're going to be frustrated. You're going to be frustrated. So I think there, there is something to be said for a sophisticated conversation, but having said that, the board should always be leaning forward on spending on people. For the team, often the, the, it can be a little bit intimidating because everybody kind of feels like a little co-founder at the beginning, and then all of a sudden you're building a hierarchy, um, and all of a sudden there's people coming in atop, and oh, these people are earning three matches. I'm As I'm earning. And I think the best entrepreneurs very early on make it clear to the team that the organization is going to change over time, and t…

AI assessment note: “guidance is on hiring the, the, the wrong people, or sorry, the right people too early”

Q And I want to hear about Blue Yard now, so hit me with a bit about the fund, you know, what stage you're into, what preferences you have in terms of sectors, geographies, what's the synopsis on the fund overall, would you say?

A Yeah, um, so, um, I, I, I hope, um, we're kind of asking people to keep the congratulations for, in a couple of years, if we've hopefully managed to help some intrapreneurs, Um, because, you know, I can, I can tell you that, you know, it's, it's easy to, it's like entrepreneurs, you celebrate raising money, that's great, but after 30 seconds, you're, oh, wow, you know, look at that, you know, huge responsibility on our hands now. Blue Yard, it's a very small firm, it's, you know, Jason, myself, and then we have Chad as a venture partner, who you know, is, is a much more, A, he's a better saxophone player than we all are, and B, you know, he's a He's a tech leader, and he's a meaningful venture partner, and we wanted to create a firm that is very small, and where entrepreneurs really only deal with, with the partners, and where we can be very agile, and quick, and also where we can form the entire firm around a thesis. Um, and there's three fundamental forces, um, we think are happening, um, in society, and in economies, and we want to help entrepreneurs build companies around them. One of them is The decentralization of markets, so the reduction of the power of gatekeeping, um, uh, items, then allowing more people to transact in markets, um, allowing individuals to, um, you know, build up an economy on their own, um, and we, we think that that's going to increase and not decrea…

AI assessment note: “wanted to create a firm that is very small... form the entire firm around a thesis”