The Exchanges

Q a hundred K checks around as option checks. The trouble with that then, and then my question too, is like signaling. If you spray a hundred K checks, you're like, ah, well, listen, we do 5000 K checks a year. The fact that we're not following them doesn't mean anything, whatever. When you're doing three to six, and it's much more meaningful, how do you think about concerns around signaling?

A This is an example of why I'm blessed to be able to work at Excel, and it's a huge advantage having kind of the firm's brand as a new investor. So we looked at the data on this actually a couple years ago, We looked at a cohort of seed deals we'd done over the course of three years. So every deal we'd done at the seed stage in three years, we'd done about 40 deals, and we termed 25 of them at maturity. So 15 of them were still too new at the time we did this analysis. So they were, they were like, you know, six months in, so they weren't looking to raise follow-ons. Of the 25 that were at maturity, at the time, 18 of them had raised follow-on capital from us or other people, a Series A. Of the remaining seven, I think two had died, one to an odd legal situation, one had run out of capital. I think maybe three had been acquired, and a couple others had not been funded. Those odds are phenomenal. I mean, interestingly enough, and I think actually Sequoia might have shared some data to this effect. At least all the statistics we've seen, the signal of an Excel seed is the most positive thing you can almost possibly have in the market, which we were somewhat surprised to see. And actually, that's the way our seed investing program goes badly, by the way. It's the positive signaling from our investments statistically. So I noticed, I said, 18 of them had raised Series A's, but only …

AI assessment note: “the signal of an Excel seed is the most positive thing you can almost possibly have”

Q I do want to kick off with a little bit on you. So we both know Venture is this very weird but wonderful world, but you had an even more interesting path than most. Started as an associate at Excel, then left and returned to it. So a question actually from your wonderful wife, Christina, what led you to Excel? And then what led you back again the second time?

A Honestly, I never envisioned being a venture capitalist. Right before I joined Excel the first time around in, I had founded a company called Chartio and went through Y Combinator, and candidly, I was a terrible, terrible founder for a variety of reasons. I ultimately ended up leaving the company, and as part of that, I hadn't been paying myself during the summer. Back then, YC gave us 17,000 dollars for the summer, and I had no savings, so I was broke. And when I was at Chartio, I had had the good fortune to meet a guy at Excel named Kevin Eppercie, and I liked him, and he liked me, I gather, in hindsight, but I didn't think too much of it. It wasn't going to fund Chartio. And then all of a sudden, through the grapevine, After I'd left Chartio, we reconnected, and he kind of inquired, hey, have you ever thought about doing venture? And the honest truth was not particularly. I mean, as you might know, I think the default posture of YC companies and founders is a little bit of fun, fear, uncertainty, and doubt about the venture community, which I think is merited in some cases, and so I had never envisioned doing it, but candidly, I really needed the job, and I really liked Kevin. The other thing that was interesting about it was when you were in Y Combinator around this community of founders, venture loomed. It was this really important aspect of our lives, like raising money a…

AI assessment note: “candidly, I really needed the job, and I really liked Kevin.”

Q defined theses where you're like, I'm going after markets that fit this thesis because I've done the work, and I see the market moving in this direction. Like, for me, I'm like, confirmation bias one, exclusion to moonshots that can come your way because you're so, like, maniacally focused on that thesis. Would you say you're a Thesis driven investor or actually not given that and the humility around it?

A I think I try to have a very small number of theses that I think are crazy obvious. So I'll give you an example of this. I'll give you two examples, but really one core example, which is like largely my investment thesis of my career so far will be for the next 20 years. I'm really bullish on software and not software like the category software that sells just to businesses, but literally actual software, which is communicating information via bits over like networks where it approaches the speed of light. I'm like incredibly, incredibly bullish on software. To an incredible degree. You know, some people think they're bullish on software, that software's taking over, and then they fund massive enterprise sales teams. I think those things can be very effective, by the way, but logically, if you really believe on software, one area that's likely to be disrupted is the traditional sales process. It doesn't mean you can't also make money investing in the traditional sales process, and we've seen this, by the way. We've seen a lot of companies that their growth ratio to their investment in sales has massively gotten more efficient. Dropbox, Slack, Zoom, Stripe are examples of companies. AWS, massively this way, so that is, like, my one core thesis is software. Now, then there's derivatives of I mean, my favorite part is when I talk to a lot of other people about this, people doubt i…

AI assessment note: “I think I try to have a very small number of theses”

Q a hundred K checks around as option checks. The trouble with that then, and then my question too, is like signaling. If you spray a hundred K checks, you're like, ah, well, listen, we do 5000 K checks a year. The fact that we're not following them doesn't mean anything, whatever. When you're doing three to six, and it's much more meaningful, how do you think about concerns around signaling?

A This is an example of why I'm blessed to be able to work at Excel, and it's a huge advantage having kind of the firm's brand as a new investor. So we looked at the data on this actually a couple years ago, We looked at a cohort of seed deals we'd done over the course of three years. So every deal we'd done at the seed stage in three years, we'd done about 40 deals, and we termed 25 of them at maturity. So 15 of them were still too new at the time we did this analysis. So they were, they were like, you know, six months in, so they weren't looking to raise follow-ons. Of the 25 that were at maturity, at the time, 18 of them had raised follow-on capital from us or other people, a Series A. Of the remaining seven, I think two had died, one to an odd legal situation, one had run out of capital. I think maybe three had been acquired, and a couple others had not been funded. Those odds are phenomenal. I mean, interestingly enough, and I think actually Sequoia might have shared some data to this effect. At least all the statistics we've seen, the signal of an Excel seed is the most positive thing you can almost possibly have in the market, which we were somewhat surprised to see. And actually, that's the way our seed investing program goes badly, by the way. It's the positive signaling from our investments statistically. So I noticed, I said, 18 of them had raised Series A's, but only …

AI assessment note: “the signal of an Excel seed is the most positive thing you can almost possibly have”

Q Tell me, final one, the most recent publicly announced investment you made, and why did you say yes and get so excited?

A Yeah, so I recently invested in a company called Altinity, which is building a company around the open source project ClickHouse. I actually agreed to the investment in February and wired the money in April, right in the midst of the worst of the pandemic in the US. For people who don't know much about ClickHouse, it's just this incredible open source columnar database. So if you're looking for low latency data analytics, ClickHouse is kind of the best game in town. It's kind of a very, very popular project that's been adopted by huge companies like Cisco, Uber, Cloudflare, Century, Mux, Instana, Segment, Tencent, ByteDance, et cetera, et cetera, et cetera. It's incredibly popular, but there hadn't been a company built around it. And it was weird to me because a few years ago or so, I'd long waited for something in this category for about a decade now, actually. It's an area where as a software engineer, I'd made use of these products, and it had gone silent, this whole category. And all of a sudden, a few years ago, ClickHouse started showing up on my radar, and it was such a great example of where you hear enough people love a product, and there's got to be something there. So the team at Century, where I'm on the board, loved it. Mux loved it. Instana, sales and investment, loved the product. I talked to some friends at Cloudflare. They're like, this is the secret of our who…

AI assessment note: “I recently invested in a company called Altinity, which is building a company around”

Q it's like, you know, I spoke to John Locke on your team before the show, and he mentioned, obviously, most people go to business school. You kind of went to Dropbox really is your business school, and kind of what better business school than Dropbox. But I guess the question that he asked is like, what do you think you learned from Dropbox that made you a better investor fundamentally?

A I think almost all of the best lessons I've learned are effectively lessons of humility, like learning about what I don't know. And so I joined Dropbox, and it was I first joined. There were about 200 people, but the company was already kind of a juggernaut. It had been incredibly successful. A relatively small group of people had built this amazing thing that had begun to grow rapidly like a weed before I even joined, and it was just an incredible place. I tried very hard. I thought I was a reasonably smart person, but the power of kind of a product that people love and of an incredible early team was really proven out of Dropbox. Everyone after that was incredible and wonderful people, but a lot of the core value of Dropbox was built by a relatively small group of people early on, and so you kind of get out of your own head where I think a lot of people want to believe They make the difference, and that they as an individual are so important, and I think people matter. Individuals can accomplish a lot, but great products and great teams are just an incredible sight to behold when they're working, and that humility is really important as an investor. I don't know is the answer I give to my founders the most. I don't know the right answer. I can proffer advice and try and be helpful, but I'm not in the arena. I professionally give away money for a living, and I've witnessed com…

AI assessment note: “almost all of the best lessons I've learned are effectively lessons of humility”

Q from it. We mentioned before my incredibly poor, Poor sense of skill and judgment around using Microsoft Excel. Being, like, a big partner, but it's, like, actually quite a big insecurity for me as an investor, and it genuinely makes me kind of challenge myself, and it makes me quite uncomfortable. When you think about, like, the humility there, where do you find, like, insecurities for yourself as an investor?

A I mean, everywhere. I can't, I'm a short, bald guy. I have a lot of insecurities. I think I honestly have insecurities about virtually everything. Whether I'm making good underwriting and investment decisions, whether I'm doing the best I can to win a deal and what makes sense. But I think a lot of them are about how I work with founders. Am I doing right by them? Am I doing the right thing? I'm very sensitive to that because I think it's the core of our job. And you can never do it perfectly. Anyone even meaningfully trying to do their best is going to find moments where I nicely disagree with people. I disagree with my wife, my family members, my best friends all the time. That's okay. But you just always want to be doing better and better. And I will say one thing that is maybe somewhat unique having grown up in the founder and technical engineer community in the Bay Area is that most of my friends are founders or employed at tech companies. Like overwhelming. They have been for a long time. And I have a lot of probably insecurity about those relationships on a regular basis. You know, the example of this that I always think about is a few years ago, I was at a friend's house. He was throwing a modest, like, party, probably about 50 people or so, and I was with my wife, and a bunch of people we've known for a decade and are friendly with, and I was in a conversational circle…

AI assessment note: “I think a lot of them are about how I work with founders.”

Q doesn't matter. It's an option. It's a three million option from a billion dollar fund, and they just want the A, they want the B, and they just get the data in from seed, and I'm seeing this more aggressively than ever. How do you think about multi-stage coming in so aggressively at seed? I'd love your thoughts, given, as you said, like, as early as possible is your game.

A Yeah, I would say probably half of my boards have started at seed deals. The fundamental thing I would say is this is all, in my opinion, this has always been the core of the venture capital business. So the first Excel fund in the early eighties, maybe like 30 something million dollars, and the check sizes were in the hundreds of thousands or low millions frequently. And then into the nineties, the dot com bubble happened, fund sizes ballooned, checks getting written in grew, and then the bubble collapsed, and you kind of still had these pretty large fund sizes, but people were maybe a little bit more risk averse in the venture side of things while stuff was going on. And at the same time, the cost to start a company was going down with things like commodity hardware and just the ease of building software coming down, right, and distribution to the internet. So there emerged this ability to Start companies with less capital, and for whatever reason, a bunch of venture firms chose not to, at the time, play there, and upcropped the seed stage. I mean, just an easy way of proving out this history is the reason it's called a Series A was that's the first letter of the alphabet. If you didn't want to be the first thing going on, you should have just started by calling it the B, or you could have been second round capital. But traditional firms, they wanted to do Series A's. They wa…

AI assessment note: “this has always been the core of the venture capital business.”

Q capitalists of the world, and their ability to make decisions faster, be so much more on the ground, and kind of real-time, just because of the nature of their investment decision-making processes, and I think that's why we've seen the rise of this segment. How do you feel about solo capitalists, and like, would you disagree with me that more than ever, the personalization of the partner is the case?

A First thing I would say is it's certainly something that's happening, and I, again, on this topic, as in many others, I'm quite likely wrong. Our job is strange, as you know. We're wrong the majority of the time when we make investment decisions, oftentimes, and it can still work out, so I embrace that. I think the sole capitalists are here, and I think many of them will continue to be a thing for a long period of time, and it might become a new mode in our industry, a bimodal or trimodal situation, but I personally love the partnership model. I love contributing into a brand that is Excel and then passing that on to another group and sharing that brand with our companies. I think you can do that as a solo capitalist. You can do that as a member of a firm with a personal brand. It's plausible, but I think it's tricky, and there's a lot of prickly points around the boundaries and edges that make that more complicated. I think it's easy for ego to creep into our industry, and you have to actively fight it as best you can, in my opinion, and I do think, like, for us at Excel, companies are Excel companies. We all help all of our portfolios as best we can. If a company that's not something I work with asks me for help, I'll do my best to help them, and I think that's something we love about what we do, and we really care about. It doesn't mean it's always correct, It's a core value…

AI assessment note: “I think the sole capitalists are here... but I personally love the partnership model.”

Q doesn't matter. It's an option. It's a three million option from a billion dollar fund, and they just want the A, they want the B, and they just get the data in from seed, and I'm seeing this more aggressively than ever. How do you think about multi-stage coming in so aggressively at seed? I'd love your thoughts, given, as you said, like, as early as possible is your game.

A Yeah, I would say probably half of my boards have started at seed deals. The fundamental thing I would say is this is all, in my opinion, this has always been the core of the venture capital business. So the first Excel fund in the early eighties, maybe like 30 something million dollars, and the check sizes were in the hundreds of thousands or low millions frequently. And then into the nineties, the dot com bubble happened, fund sizes ballooned, checks getting written in grew, and then the bubble collapsed, and you kind of still had these pretty large fund sizes, but people were maybe a little bit more risk averse in the venture side of things while stuff was going on. And at the same time, the cost to start a company was going down with things like commodity hardware and just the ease of building software coming down, right, and distribution to the internet. So there emerged this ability to Start companies with less capital, and for whatever reason, a bunch of venture firms chose not to, at the time, play there, and upcropped the seed stage. I mean, just an easy way of proving out this history is the reason it's called a Series A was that's the first letter of the alphabet. If you didn't want to be the first thing going on, you should have just started by calling it the B, or you could have been second round capital. But traditional firms, they wanted to do Series A's. They wa…

AI assessment note: “this has always been the core of the venture capital business.”

Q it's like, you know, I spoke to John Locke on your team before the show, and he mentioned, obviously, most people go to business school. You kind of went to Dropbox really is your business school, and kind of what better business school than Dropbox. But I guess the question that he asked is like, what do you think you learned from Dropbox that made you a better investor fundamentally?

A I think almost all of the best lessons I've learned are effectively lessons of humility, like learning about what I don't know. And so I joined Dropbox, and it was I first joined. There were about 200 people, but the company was already kind of a juggernaut. It had been incredibly successful. A relatively small group of people had built this amazing thing that had begun to grow rapidly like a weed before I even joined, and it was just an incredible place. I tried very hard. I thought I was a reasonably smart person, but the power of kind of a product that people love and of an incredible early team was really proven out of Dropbox. Everyone after that was incredible and wonderful people, but a lot of the core value of Dropbox was built by a relatively small group of people early on, and so you kind of get out of your own head where I think a lot of people want to believe They make the difference, and that they as an individual are so important, and I think people matter. Individuals can accomplish a lot, but great products and great teams are just an incredible sight to behold when they're working, and that humility is really important as an investor. I don't know is the answer I give to my founders the most. I don't know the right answer. I can proffer advice and try and be helpful, but I'm not in the arena. I professionally give away money for a living, and I've witnessed com…

AI assessment note: “that humility is really important as an investor.”

Q moved to the market mattering just as much. And, you know, you hear the kind of statement, which is, you know, great market, poor people, market wins, great people, poor market, market wins. And so I'm like intrigued. How do you think about that stack of prioritization? And where do you land in terms of your assessment on prioritizing market, people, products, and how you think about it investing wise?

A I'll give you an answer. I give a lot of people when they ask about how I think an investment that addresses these two things. So I try and focus as early as I can on any investment. So it's just getting started. That's my deal zone. And I tend to look at what I facetiously say is two and a half things. And there's some bullets at venture capitalists. We like to hear ourselves talk. So we always have subtitles, but, um, you know, the two and a half things are people market and then how it's gone lately, how it's gone so far given time and money. And that's a half, because to me, it's more of a debugging mechanism to prove that maybe I was wrong in my underwriting of the people in the market. But I really don't lead with that. I'm happy to come back to that in detail. But on the team side, I think about kind of four canonical things. The number one thing is, do I like this person? And I think the key thing there is, like, do I want to help them? There's a lot of ways to make money backing people you might not particularly like, and I effectively will forego those. And it might make me a worse investor from a peer returns perspective, but I'll be a lot happier, and I think over time, it'll prove out to be a good strategy. So do I like the people? Do I want to go to work for them and help them? Number two is, are they capable of intelligence? I'd rather they didn't have to use it.…

AI assessment note: “the two and a half things are people market and then how it's gone lately”

Q a risk on actually is market timing. And what I mean by that is I'm totally willing to make a bet on market growth, like fundamental market timing, be it virtual reality as a brilliant example. Like, I think there's enough that can go wrong without taking market timing risk. How do you think about market timing as a core risk and how you engage with it or not engage?

A Ideally, just like you, I'd rather not take the risk, but I'll do it sometimes. This is a good example of where I think humility in our profession is really critical. I think the biggest risk around market timing is when an investor thinks they are really good at market timing. They think they know this is the time. They think they know something other people don't about timing. On the one hand, if you're correct, that can be quite valuable. On the other hand, I'm very wary of any line of reasoning by an investor that is, I'm smarter than other people. Any one particular thing. I think that's very unlikely to be true in the broad context of it. There has to be one smartest investor somewhere out there, right? But just like I mentioned when I look for founders that are capable of being intelligent, but don't have to use it, I think the same is true of investors. My dream, I don't think I'm that bright, and I certainly don't want to rely on having investing thesis that are completely rooted to being the single smartest investor in the world. That strikes me as a poor strategy. And I think a lot of market timing investments are around that, that you really believe in something. The other thing I'd say about market timing is certainly Apple as a company epitomizes their products, but a lot of markets, it's hard to understand the abstraction around a market. And so a lot of markets,…

AI assessment note: “Ideally, just like you, I'd rather not take the risk, but I'll do it sometimes.”

Q I think it used to be so much more. Now I feel I don't always have the time to build the relationship of depth and trust and transparency in such a short fundraising timeline. Yes, You build the relationships before. Sometimes it's not possible. Sometimes founders are fixed on, no, my head's down. I'm not meeting investors. You know what it's like. That would be mine. What would yours be?

A This is a weird answer, but I just think this is so important. Like, I just wish the venture community was dramatically more empathetic and compassionate and trying harder on those things. Across the board, it's not really a mechanic, so that's why it's a cop-out question, but like, generally speaking, the venture community is amongst the most privileged communities in the world, and I think we get to do one of the greatest jobs in the world, and it's unfair. It's fundamentally unfair that that's the case, And I think anyone who has the privilege of doing this job should be doing everything they can to, on the one hand, do their job well, help their founders do right by their LPs, and on the other hand, like, appreciate their good fortune and be empathetic and compassionate about everyone else in the world around you, as opposed to more tone deaf or more self-centered. And it's really hard, and I'm sure I fail at this all the time, but at least try really hard. That's what the world can ask of you, and I wish all fortunate people in the venture community did that much, much, much, much, much, much better.

AI assessment note: “I just wish the venture community was dramatically more empathetic and compassionate”

Q defined theses where you're like, I'm going after markets that fit this thesis because I've done the work, and I see the market moving in this direction. Like, for me, I'm like, confirmation bias one, exclusion to moonshots that can come your way because you're so, like, maniacally focused on that thesis. Would you say you're a Thesis driven investor or actually not given that and the humility around it?

A I think I try to have a very small number of theses that I think are crazy obvious. So I'll give you an example of this. I'll give you two examples, but really one core example, which is like largely my investment thesis of my career so far will be for the next 20 years. I'm really bullish on software and not software like the category software that sells just to businesses, but literally actual software, which is communicating information via bits over like networks where it approaches the speed of light. I'm like incredibly, incredibly bullish on software. To an incredible degree. You know, some people think they're bullish on software, that software's taking over, and then they fund massive enterprise sales teams. I think those things can be very effective, by the way, but logically, if you really believe on software, one area that's likely to be disrupted is the traditional sales process. It doesn't mean you can't also make money investing in the traditional sales process, and we've seen this, by the way. We've seen a lot of companies that their growth ratio to their investment in sales has massively gotten more efficient. Dropbox, Slack, Zoom, Stripe are examples of companies. AWS, massively this way, so that is, like, my one core thesis is software. Now, then there's derivatives of I mean, my favorite part is when I talk to a lot of other people about this, people doubt i…

AI assessment note: “I think I try to have a very small number of theses”

Q kind of if we Expand that a little bit from kind of like the immediate friendship circles to more the broader ecosystem and thinking about like seed and series A where we both play. Honestly, Dan, I'm quite worried. I've never seen the velocity of deals being done. I've never seen the pricing that's being done. How do you assess the current state of the seed and series A market?

A I probably try to be as zen as I can about it. I'm sure you feel every day. We can't always, as an individual or even as a firm or even as a group of people, have an impact. The market is kind of what it is, which I think is a wonderfully And if you ask me on an absolute basis, has pricing gone up? I would say that's probably true. Has time to do a deal gone down? I think that's probably the case. At the same time, I think at least right now, we're seeing more great companies being created and growing bigger than ever before. So I try not to have opinions about the market. I just kind of try and focus on what I'm doing, my little slice of the world and what I can control. And so I probably look at the market today and I focus more and more on building deep relationships with founders over long periods of time, well before they even start a company, and then backing them before some product has taken off. In the moments where I do want to back a company that has momentum and wants to run a process, I accept the reality that maybe market pricing is higher than it has been, but it sounds odd, but I kind of just feel like I'm a buoy or a surfer floating on the ocean, and I would say, again, tangibly, the data points bear out what you're saying, but it doesn't really bother me so much. I mean, if anyone's going to benefit from this, having the opportunity to work at a wonderful bran…

AI assessment note: “tangibly, the data points bear out what you're saying, but it doesn't really bother me”

Q moved to the market mattering just as much. And, you know, you hear the kind of statement, which is, you know, great market, poor people, market wins, great people, poor market, market wins. And so I'm like intrigued. How do you think about that stack of prioritization? And where do you land in terms of your assessment on prioritizing market, people, products, and how you think about it investing wise?

A I'll give you an answer. I give a lot of people when they ask about how I think an investment that addresses these two things. So I try and focus as early as I can on any investment. So it's just getting started. That's my deal zone. And I tend to look at what I facetiously say is two and a half things. And there's some bullets at venture capitalists. We like to hear ourselves talk. So we always have subtitles, but, um, you know, the two and a half things are people market and then how it's gone lately, how it's gone so far given time and money. And that's a half, because to me, it's more of a debugging mechanism to prove that maybe I was wrong in my underwriting of the people in the market. But I really don't lead with that. I'm happy to come back to that in detail. But on the team side, I think about kind of four canonical things. The number one thing is, do I like this person? And I think the key thing there is, like, do I want to help them? There's a lot of ways to make money backing people you might not particularly like, and I effectively will forego those. And it might make me a worse investor from a peer returns perspective, but I'll be a lot happier, and I think over time, it'll prove out to be a good strategy. So do I like the people? Do I want to go to work for them and help them? Number two is, are they capable of intelligence? I'd rather they didn't have to use it.…

AI assessment note: “the two and a half things are people market and then how it's gone lately”

Q capitalists of the world, and their ability to make decisions faster, be so much more on the ground, and kind of real-time, just because of the nature of their investment decision-making processes, and I think that's why we've seen the rise of this segment. How do you feel about solo capitalists, and like, would you disagree with me that more than ever, the personalization of the partner is the case?

A First thing I would say is it's certainly something that's happening, and I, again, on this topic, as in many others, I'm quite likely wrong. Our job is strange, as you know. We're wrong the majority of the time when we make investment decisions, oftentimes, and it can still work out, so I embrace that. I think the sole capitalists are here, and I think many of them will continue to be a thing for a long period of time, and it might become a new mode in our industry, a bimodal or trimodal situation, but I personally love the partnership model. I love contributing into a brand that is Excel and then passing that on to another group and sharing that brand with our companies. I think you can do that as a solo capitalist. You can do that as a member of a firm with a personal brand. It's plausible, but I think it's tricky, and there's a lot of prickly points around the boundaries and edges that make that more complicated. I think it's easy for ego to creep into our industry, and you have to actively fight it as best you can, in my opinion, and I do think, like, for us at Excel, companies are Excel companies. We all help all of our portfolios as best we can. If a company that's not something I work with asks me for help, I'll do my best to help them, and I think that's something we love about what we do, and we really care about. It doesn't mean it's always correct, It's a core value…

AI assessment note: “I think the sole capitalists are here... but I personally love the partnership model.”

Q kind of if we Expand that a little bit from kind of like the immediate friendship circles to more the broader ecosystem and thinking about like seed and series A where we both play. Honestly, Dan, I'm quite worried. I've never seen the velocity of deals being done. I've never seen the pricing that's being done. How do you assess the current state of the seed and series A market?

A I probably try to be as zen as I can about it. I'm sure you feel every day. We can't always, as an individual or even as a firm or even as a group of people, have an impact. The market is kind of what it is, which I think is a wonderfully And if you ask me on an absolute basis, has pricing gone up? I would say that's probably true. Has time to do a deal gone down? I think that's probably the case. At the same time, I think at least right now, we're seeing more great companies being created and growing bigger than ever before. So I try not to have opinions about the market. I just kind of try and focus on what I'm doing, my little slice of the world and what I can control. And so I probably look at the market today and I focus more and more on building deep relationships with founders over long periods of time, well before they even start a company, and then backing them before some product has taken off. In the moments where I do want to back a company that has momentum and wants to run a process, I accept the reality that maybe market pricing is higher than it has been, but it sounds odd, but I kind of just feel like I'm a buoy or a surfer floating on the ocean, and I would say, again, tangibly, the data points bear out what you're saying, but it doesn't really bother me so much. I mean, if anyone's going to benefit from this, having the opportunity to work at a wonderful bran…

AI assessment note: “has pricing gone up? I would say that's probably true. Has time to do a deal gone down?”

Q I do want to kick off with a little bit on you. So we both know Venture is this very weird but wonderful world, but you had an even more interesting path than most. Started as an associate at Excel, then left and returned to it. So a question actually from your wonderful wife, Christina, what led you to Excel? And then what led you back again the second time?

A Honestly, I never envisioned being a venture capitalist. Right before I joined Excel the first time around in, I had founded a company called Chartio and went through Y Combinator, and candidly, I was a terrible, terrible founder for a variety of reasons. I ultimately ended up leaving the company, and as part of that, I hadn't been paying myself during the summer. Back then, YC gave us 17,000 dollars for the summer, and I had no savings, so I was broke. And when I was at Chartio, I had had the good fortune to meet a guy at Excel named Kevin Eppercie, and I liked him, and he liked me, I gather, in hindsight, but I didn't think too much of it. It wasn't going to fund Chartio. And then all of a sudden, through the grapevine, After I'd left Chartio, we reconnected, and he kind of inquired, hey, have you ever thought about doing venture? And the honest truth was not particularly. I mean, as you might know, I think the default posture of YC companies and founders is a little bit of fun, fear, uncertainty, and doubt about the venture community, which I think is merited in some cases, and so I had never envisioned doing it, but candidly, I really needed the job, and I really liked Kevin. The other thing that was interesting about it was when you were in Y Combinator around this community of founders, venture loomed. It was this really important aspect of our lives, like raising money a…

AI assessment note: “candidly, I really needed the job, and I really liked Kevin.”

Q I think it used to be so much more. Now I feel I don't always have the time to build the relationship of depth and trust and transparency in such a short fundraising timeline. Yes, You build the relationships before. Sometimes it's not possible. Sometimes founders are fixed on, no, my head's down. I'm not meeting investors. You know what it's like. That would be mine. What would yours be?

A This is a weird answer, but I just think this is so important. Like, I just wish the venture community was dramatically more empathetic and compassionate and trying harder on those things. Across the board, it's not really a mechanic, so that's why it's a cop-out question, but like, generally speaking, the venture community is amongst the most privileged communities in the world, and I think we get to do one of the greatest jobs in the world, and it's unfair. It's fundamentally unfair that that's the case, And I think anyone who has the privilege of doing this job should be doing everything they can to, on the one hand, do their job well, help their founders do right by their LPs, and on the other hand, like, appreciate their good fortune and be empathetic and compassionate about everyone else in the world around you, as opposed to more tone deaf or more self-centered. And it's really hard, and I'm sure I fail at this all the time, but at least try really hard. That's what the world can ask of you, and I wish all fortunate people in the venture community did that much, much, much, much, much, much better.

AI assessment note: “I just wish the venture community was dramatically more empathetic and compassionate”

Q oh, build a brand through portfolio. Well, that's fantastic, but that takes five to 10 years, as we both know. And so if you're thinking about kind of creating a pre-sales engine and a lead gen engine for the deals to get the portfolio, It's almost like a causation. Do you know what I mean? And so I think of it more like a lead gen engine in many respects.

A I think that's a good way to think about it. I think one of the cool things about our business, and I'll speak about other firms just to not be self-referential, there's a spectrum of different approaches to marketing. Some of the most prominent firms in the world basically do not maintain a website, and other firms have incredibly talented PR people on staff and really think about their product marketing as a goal, and I think both can really work. So I think there's a lot of appreciation there. Another small thing I would say about this is that's unique to me, and I just think about a lot, is I don't want to have a personal brand. There's all these great quotes about, I think Bill Murray said it, something around, some people come to me and say they want to be rich and famous, and I ask, you should try just being rich first, because fame is less valuable than you think, or something like that, along the lines. I think there's a lot of downsides to personal brand, especially as it comes to, like, being part of a team and supporting your founders. I never want to be taking away attention from the founders doing hard work. It's their work. They've accomplished so much, and if even in the slightest, people want to do an article about me or talk to me, I'd rather they talk to my founders. I'd rather they talk to the people building the businesses, and any little bit I can do to ta…

AI assessment note: “I think that's a good way to think about it.”

Q to share their theses on Twitter of all places. You said I could throw a curveball, so I'm interested by this one. How do you think about VC Twitter to stay down? You're very under the radar, and you're very much, no offense, not a part of engaging really in that so much, so how do you think about that, and how do you think about personal investor brand today?

A I guess there's two areas of focus for this. The first part about it is, I think a lot of people, and I respect this, for them, Twitter is kind of a marketing vehicle as an investor, and so I, on the one hand, I appreciate that, and I think I get that some people choose to do marketing in that way, and I have no personal problem with it. Instruction is very difficult. I think the best marketing is a great product. It really packs a lot of depth, and if people only know you through Twitter, which is a fantastic medium for lots of things, it's sometimes hard to be more precise and to go into detail, which is perfectly fair, but I also understand why people do it. I think the second thing is just like the quality of the actual dialogue and stuff. Again, this is not a point about Twitter, but I just don't believe I have that many interesting things to tell people. I just don't. I don't have that hubris, and so to me, for me personally, I can't speak for everyone, I don't know that it would be particularly good marketing, because if I pretended to be a potential quote-unquote customer of my Tweeting. I would think it was terrible. So, so I'm not going to inflict that upon other people. I also think like, I don't think people focus too much on one of the challenges of Twitter is that these personalities develop, but it's hard to understand the underlying depth of value there. There a…

AI assessment note: “I just don't believe I have that many interesting things to tell people”

Q question to like you and to multi-stage funds is bluntly, does the sales process not continue for them? Cause they want you to lead the A. You're fantastic, Daniel. We love you, and we love the Excel brand. We don't want to tell you all the shit that's actually going down, because we all need to lead the A as well. How do you think about that as a challenge?

A It's a really interesting challenge. I think so long as you could potentially buy up, I think that's the core job of us as individuals, as partners, as people supporting founders. We have to build a great relationship, and we have to help them no matter what, and be positive about it. That's the goal. It's also why we want to own a bunch of the company in the seed stage, as opposed to a small percentage. You know, in the case of Strapi, it's a great example of this. I love the Strapi team. I think they're super talented, great people. I want them to succeed as much as possible, and I still have a meaningful ownership stake. Excel still has a meaningful ownership stake in the company. We're incentivized to help them, because that's the core of our business. So I think you do have to really build that personal relationship and work with them. I would tell you candidly that the tension between lead investor and founder and CEO of a company is a good thing, and it persists over the lifetime of the company. One of the downsides, maybe, of working at an Excel, which I'm happy to bear, and there's not many of them, is for better or worse, our actions with respect to a company always matter. We get calls from late-stage investors about our parata, about how we think about the business all the time. So our job is to help the company as best we can, as much as possible. We always have to…

AI assessment note: “the tension between lead investor and founder and CEO of a company is a good thing”

Q question to like you and to multi-stage funds is bluntly, does the sales process not continue for them? Cause they want you to lead the A. You're fantastic, Daniel. We love you, and we love the Excel brand. We don't want to tell you all the shit that's actually going down, because we all need to lead the A as well. How do you think about that as a challenge?

A It's a really interesting challenge. I think so long as you could potentially buy up, I think that's the core job of us as individuals, as partners, as people supporting founders. We have to build a great relationship, and we have to help them no matter what, and be positive about it. That's the goal. It's also why we want to own a bunch of the company in the seed stage, as opposed to a small percentage. You know, in the case of Strapi, it's a great example of this. I love the Strapi team. I think they're super talented, great people. I want them to succeed as much as possible, and I still have a meaningful ownership stake. Excel still has a meaningful ownership stake in the company. We're incentivized to help them, because that's the core of our business. So I think you do have to really build that personal relationship and work with them. I would tell you candidly that the tension between lead investor and founder and CEO of a company is a good thing, and it persists over the lifetime of the company. One of the downsides, maybe, of working at an Excel, which I'm happy to bear, and there's not many of them, is for better or worse, our actions with respect to a company always matter. We get calls from late-stage investors about our parata, about how we think about the business all the time. So our job is to help the company as best we can, as much as possible. We always have to…

AI assessment note: “the tension between lead investor and founder and CEO of a company is a good thing”