The Exchanges

Q Now, don't laugh, Jeff, but I invest one to three million pounds, say. You invest a slightly larger amount, so I'm sure our diligence processes differ. Can I ask, what does the diligence process look like, and does it differ extraordinarily differently compared to, say, earlier stage investments that often we see being made in the news?

A I think it does differ considerably from early stage investment. When you're doing a seed or a series A investment, you're really thinking about Two or three things. One is, what is the TAM or addressable market for this product or service? Second, do I believe that this novel approach is different enough and simplistic enough that people are willing to take out their credit card or their checkbook and to pay for the service? And do I believe that this entrepreneur and her co-founders are the right team to go prosecute against that idea? Where when you're doing late It looks more like the type of diligence a traditional private equity firm would do. We're mapping out the entire value chain of an industry. We're understanding where the economic rents are. We're meeting with both the incumbents and the startups and understanding where we think the leverage points are. We're meeting with the entire management team, the competition industry experts. We are then negotiating a deal. We're looking at company specific data because later stage, they already have product market fit. They have customers, they have revenue, they may have profit or contribution margin. They're likely geographically dispersed in a global basis. And so the type of diligence we do is just much more in depth because there's more data and more data points. And so that may take between four and 10 weeks of dilige…

AI assessment note: “I think it does differ considerably from early stage investment.”

Q Well, that is very, very kind of you, but I'd love to get started today with a little bit on you, Jeff. So how did you make your way into the world of venture in one of the most fascinating roles as a managing partner at the Vision Fund?

A Well, I spent my close to 30 year career really as an operator, but also doing a lot of deals. I ran business development and corporate venture at a number of Fortune 500 companies. I've been an advisor to a half a dozen venture capital firms and KKR in the private equity side. And at Shutterfly, my last position, we bought, uh, 17 companies. So in my career, I've bought 46 companies and sold five, and so I've been involved in a lot of deals. I also have been an angel investor in a number of startups in the valley and a mentor to a lot of CEOs, so it's been a passion of mine, and as I retired from Shutterfly and was contemplating my next move, I was trying to figure out if I go back into an operating role or into a investing role, and I was actually headed to go run a public company when I met Masayoshi-san, and he convinced me to join as a founding managing partner and help change the world through the Vision Fund.

AI assessment note: “when I met Masayoshi-san, and he convinced me to join as a founding managing partner”

Q Now, don't laugh, Jeff, but I invest one to three million pounds, say. You invest a slightly larger amount, so I'm sure our diligence processes differ. Can I ask, what does the diligence process look like, and does it differ extraordinarily differently compared to, say, earlier stage investments that often we see being made in the news?

A I think it does differ considerably from early stage investment. When you're doing a seed or a series A investment, you're really thinking about Two or three things. One is, what is the TAM or addressable market for this product or service? Second, do I believe that this novel approach is different enough and simplistic enough that people are willing to take out their credit card or their checkbook and to pay for the service? And do I believe that this entrepreneur and her co-founders are the right team to go prosecute against that idea? Where when you're doing late It looks more like the type of diligence a traditional private equity firm would do. We're mapping out the entire value chain of an industry. We're understanding where the economic rents are. We're meeting with both the incumbents and the startups and understanding where we think the leverage points are. We're meeting with the entire management team, the competition industry experts. We are then negotiating a deal. We're looking at company specific data because later stage, they already have product market fit. They have customers, they have revenue, they may have profit or contribution margin. They're likely geographically dispersed in a global basis. And so the type of diligence we do is just much more in depth because there's more data and more data points. And so that may take between four and 10 weeks of dilige…

AI assessment note: “I think it does differ considerably from early stage investment.”

Q Well, that is very, very kind of you, but I'd love to get started today with a little bit on you, Jeff. So how did you make your way into the world of venture in one of the most fascinating roles as a managing partner at the Vision Fund?

A Well, I spent my close to 30 year career really as an operator, but also doing a lot of deals. I ran business development and corporate venture at a number of Fortune 500 companies. I've been an advisor to a half a dozen venture capital firms and KKR in the private equity side. And at Shutterfly, my last position, we bought, uh, 17 companies. So in my career, I've bought 46 companies and sold five, and so I've been involved in a lot of deals. I also have been an angel investor in a number of startups in the valley and a mentor to a lot of CEOs, so it's been a passion of mine, and as I retired from Shutterfly and was contemplating my next move, I was trying to figure out if I go back into an operating role or into a investing role, and I was actually headed to go run a public company when I met Masayoshi-san, and he convinced me to join as a founding managing partner and help change the world through the Vision Fund.

AI assessment note: “I was actually headed to go run a public company when I met Masayoshi-san”

Q of people always suggest that we're in the longest bull market ever, and cycles cannot be avoided in certain cases, and then other people say, no, we're in a A 50 year, a hundred year secular shift with every industry being impacted by technology. How do you think about maybe the investing landscape today and where we are in terms of the macroeconomic environment and how that plays into it?

A Look, I'm a student of economics and a fact-based decision maker, and everything that we invest in at the Vision Fund is underpinned by data. We look for companies that are capturing data, analyzing that data, drawing insights, making recommendations, And ultimately moving towards actions. And if you look at the data over a long period of time, economies, both on a domestic and on a global basis, they go through cycles. And so we will have a down cycle and this, uh, bull market will come to an end. But if you look at the bear markets, even in the worst of times during the oh eight, oh nine financial crisis, that only lasted 24 months. And then we had an amazing resurgence since the bottoming in March of 2009. And so, since the Vision Fund are backing entrepreneurs that have global ambition on a very big scale, and because we're long-term oriented investors, we can be patient to ride out any of those near-term economic cycles, and because we have the balance sheet, we can support continued investment in our companies to gain additional competitive advantage when other companies, particularly incumbents, may be constrained in a different way than our investments. And I experienced that firsthand at Shutterfly. When the financial crisis hit, we went from growing 51% in 2007 down to 14% in oh eight and 16% in oh nine. But we had cash on the balance sheet. We were free cash flow pos…

AI assessment note: “economies, both on a domestic and on a global basis, they go through cycles”

Q In terms of price sensitivity on insertion, I always feel the best investments are not made once, but twice on reserve. Obviously, again, that's for me at the early stage. How do you think about reserve allocation today, and how does that factor into your thought process?

A Yeah, if you look at where venture firms often make the big returns, it's not on the initial investment, as you indicated, Harry, but they get to have a look and then see the traction, and then they do follow-ons, and it's the compounding effect of those dollars into your winners that often carry a fund, and so we have the same philosophy. It's slightly different given that we're writing large checks up front, but we hold a certain percentage of the fund back on reserves so that we can do follow-ons, and in my portfolio alone, We've already done follow-ons or multiple follow-ons into companies like DoorDash, Compass, Katerra, Opendoor, as some examples, and if you look across the entire Vision Fund portfolio, we've done dozens and dozens of follow-ons already as our portfolio companies are looking at M&A activity, as they're introducing new products or services, as they're expanding into further geographic regions, or they're looking at adjacent markets. And so that's the power of our platform is that we're patient, long-term capital, and we are very enthusiastic when our portfolio companies are making smart additional investments, and we're there to fund that.

AI assessment note: “we hold a certain percentage of the fund back on reserves so that we can”

Q But post the initial and reserve investment, there is a time when one investor looks for liquidity at some point. Having extended the window of privatization, as a lot of people say, through your own vehicle being much larger than other vehicles, how do you and the team think about liquidity today, Jeff?

A Yeah, so we're a twelve-year fund with two one-year extensions, so we're a fourteen-year fund pragmatically, and we're only 22 months into that journey. While we want liquidity events and every investor needs and wants those at some point, it's really not our focus today. So we're helping companies optimize the ultimate size of the franchise and the asset because we're not short-term minded, and we recognize that we come in later stage, We provide more capital that may elongate that exit, and so in more than half of our investments, we have provided a secondary component for seed and early-stage investors to have liquidity, which I think is very healthy for the ecosystem because they get liquidity, they reinvest that money into new startups, and that just continues the virtual cycle, and it allows them to raise new funds, and we're providing a broader global platform for entrepreneurs in today's economy. And so I think it's a symbiotic relationship that a fund of our size, scale, and stage, as with many of the other players, both here in Silicon Valley, in London, in Mumbai, in Jakarta, and throughout the entire world. And so we're willing to provide liquidity for early stage investors.

AI assessment note: “While we want liquidity events... it's really not our focus today.”

Q Absolutely. As I said, I heard that from the founders, and the other founder that I spoke to was Eric at Opendoor, and he said that specifically, you had a super interesting thesis on fragmented categories. So what is the thesis, Jeff, and what's it led you to?

A Look, if you can find a Industry dynamic where winner takes all, and you happen to back that winner, then you can create outsized returns in your fund, but those opportunities are fairly rare, and so I look at the opposite end of that spectrum, which is very highly fragmented industries, where the largest player still represents a modest share of the industry, so if you take Eric's industry, for example, in Opendoor, the largest The first residential brokerage in the U.S. is a company called Reology, and it's made up of over a dozen acquisitions. It's public, and yet it still only has eight or nine percent of the entire market, and they're talking about a hundreds of billions of dollars annual TAM, and so if you're a startup and you can achieve one, two, three percent market share, you could build a very substantive business, and you can make a very nice return, and so Highly fragmented industries where you have a technological advantage. If you have a better mousetrap, if you have a novel go-to-market approach, you can capture a couple points of market share and create a meaningfully large company. And so while I continue to look for those unique opportunities where winner takes all and you happen to have the opportunity to invest in that winner, but more often I'm seeing fragmented marketplaces where you can back the novel entrepreneur and still build a very interesting busin…

AI assessment note: “I look at the opposite end of that spectrum, which is very highly fragmented industries”

Q from the check size that you write? And what I mean by that is, you mentioned that kind of two hundred billion to two billion. Obviously, when you're writing for a two billion check, it's You know, almost a GDP of Luxembourg. Do you have to disassociate yourself from that number to really avoid any mentality shift? Or is it actually still very much part of the thought process almost?

A No, I think, look, you want to be conscious of the great responsibility that my team and I have been given in the amount of capital that we're investing. But at the end of the day, I think about it as percentage of the portfolio. So for traditional growth fund is a billion dollars. A two hundred million dollar investment for us would equal a two million dollar investment for a traditional billion dollar growth fund. So I think about it as allocation of percentage of the capital under management, not necessarily the absolute number of zeros in the check. And that allows you to have a relative sensibility about how we're going to allocate our time and resources. And it allows you to focus on the more important matters at hand instead of the size of the check, but the impact that we can have with our entrepreneurial partners.

AI assessment note: “I think about it as allocation of percentage of the capital under management”

Q But before we move into the quickfire round, Jeff, I do want to touch on how you really like to work with founders. As we said, spoke to many of your founders before the show, Tina Brandless being one of them. And she said, But I had to ask, how is it specifically that you like to work with your founders, Jeff?

A Yeah, having been a founder and a CEO and had been blessed with an amazing board of directors at Shutterfly, I never thought of them as early investors or as adversaries or as a boss. I thought of them as advisors, as mentors, as people that I can use as a sounding board on a multitude of decisions. And given my credibility as an operator, the way I like to work with my entrepreneurs is in that mindset of being a true partner. And the thing that gives me the most energy about my job, and there are many things, is that most of my CEOs call me at least once a week, and I don't have to call them. And it may just be, hey Jeff, I'm thinking about making a change in my CFO, or can I get your opinion about a go-to-market strategy, or I'm thinking about this M&A target, or I'm I'm thinking about changing the way we're pricing our service, and it's that credibility that I built with them, and my credibility as an operator allows me to be a value-added partner in those strategic discussions, ranging from product to marketing to technology to human resources to financing, so I like to be a partner. With that credibility comes responsibility, that our job as investors, as board members, is to be advisors, but we're not operating the company, and making that clear with the CEO's That they don't have to ask permission, and I'm here as simply an advisor, I think is an important thing to estab…

AI assessment note: “the way I like to work with my entrepreneurs is in that mindset of being a true partner.”

Q at often kind of sticking points within that seemingly very seamless process, one is often price. As a seed investor, it's commonly suggested price doesn't really matter. Peter Fenton said on this show, I actually never turned down a deal based on valuation. It's a mental trap, but it's very different being at a later stage. So I am interested. How do you think about your own price sensitivity today?

A Yeah, it's an interesting balance because if you look at all the historical data, both pragmatic data as well as academic data, the highest R-square determinant for investment returns is your entry price. And so any good investor needs to be valuation sensitive and But you need to couple that with what is the potential for this company and not be penny wise and pound foolish. And so if we're focused on a 10 year investment in a company, and we think this is going to be a ten billion dollar outcome, arguing over the last 20 or thirty billion dollars of valuation is often not worth it. It's better to get alignment quickly and then join forces so that we can help That company scale. We can introduce them to our ecosystem of portfolio companies. We could tap into our global network of potential customers and business development partnerships, and we could get back to the important part, which is execution. And so you have to be smart about your entry valuation, but you also have to be pragmatic about where and on what relative size are you talking about. But we're not going to overpay for deals that we think are Not going to meet our internal hurdle rates, because overall, we have a fiduciary responsibility to our LPs, and we want to do well by our entrepreneurs, but we want to do well by our LPs and our employees as well.

AI assessment note: “any good investor needs to be valuation sensitive”

Q from the check size that you write? And what I mean by that is, you mentioned that kind of two hundred billion to two billion. Obviously, when you're writing for a two billion check, it's You know, almost a GDP of Luxembourg. Do you have to disassociate yourself from that number to really avoid any mentality shift? Or is it actually still very much part of the thought process almost?

A No, I think, look, you want to be conscious of the great responsibility that my team and I have been given in the amount of capital that we're investing. But at the end of the day, I think about it as percentage of the portfolio. So for traditional growth fund is a billion dollars. A two hundred million dollar investment for us would equal a two million dollar investment for a traditional billion dollar growth fund. So I think about it as allocation of percentage of the capital under management, not necessarily the absolute number of zeros in the check. And that allows you to have a relative sensibility about how we're going to allocate our time and resources. And it allows you to focus on the more important matters at hand instead of the size of the check, but the impact that we can have with our entrepreneurial partners.

AI assessment note: “I think about it as allocation of percentage of the capital under management”

Q I absolutely love that story. But we mentioned some of the people that we know mutually beforehand, and one being Glenn from GGV. And he said, specifically with regards to that contemplation of operator versus investor, he asked, How do the roles of CEO and VC differ, and what were the takeaways from your time in operations that really impacted your investing mentality today?

A You know, when I was thinking about the move into venture, I thought being an operator would be a differentiator. I actually underestimated how much so. When you're a CEO, you have to think about your industry, your company, your comparative and competitive differences. What is your corporate strategy? What are the few things that you're going to do well? How do you assemble a team that augments your capabilities, and how do you paint a vision that helps people achieve more collectively than they thought possible individually? And you have to then have a set of KPIs and measurements against what your progress is, and you have to remain flexible so that you have a true north and you have a clear strategy, but in the changing face of macroeconomic, competitive landscape, consumer preferences, technological leapfrogging, You have to be adaptable and flexible to that changing environment, and as you think about being a venture capitalist, you have to do many of those same things. You have to understand the industry, the value chain, what the addressable market is. Do you believe this is a management team that has clarity of vision, the capability to assemble a great team, and execute flawlessly over a long period of time to create differentiation and scale, and so they're similar but different roles. And having had a lot of investing experience, I'm able to have pattern recognition…

AI assessment note: “I thought being an operator would be a differentiator. I actually underestimated how much so.”

Q In terms of price sensitivity on insertion, I always feel the best investments are not made once, but twice on reserve. Obviously, again, that's for me at the early stage. How do you think about reserve allocation today, and how does that factor into your thought process?

A Yeah, if you look at where venture firms often make the big returns, it's not on the initial investment, as you indicated, Harry, but they get to have a look and then see the traction, and then they do follow-ons, and it's the compounding effect of those dollars into your winners that often carry a fund, and so we have the same philosophy. It's slightly different given that we're writing large checks up front, but we hold a certain percentage of the fund back on reserves so that we can do follow-ons, and in my portfolio alone, We've already done follow-ons or multiple follow-ons into companies like DoorDash, Compass, Katerra, Opendoor, as some examples, and if you look across the entire Vision Fund portfolio, we've done dozens and dozens of follow-ons already as our portfolio companies are looking at M&A activity, as they're introducing new products or services, as they're expanding into further geographic regions, or they're looking at adjacent markets. And so that's the power of our platform is that we're patient, long-term capital, and we are very enthusiastic when our portfolio companies are making smart additional investments, and we're there to fund that.

AI assessment note: “we hold a certain percentage of the fund back on reserves”

Q Absolutely. As I said, I heard that from the founders, and the other founder that I spoke to was Eric at Opendoor, and he said that specifically, you had a super interesting thesis on fragmented categories. So what is the thesis, Jeff, and what's it led you to?

A Look, if you can find a Industry dynamic where winner takes all, and you happen to back that winner, then you can create outsized returns in your fund, but those opportunities are fairly rare, and so I look at the opposite end of that spectrum, which is very highly fragmented industries, where the largest player still represents a modest share of the industry, so if you take Eric's industry, for example, in Opendoor, the largest The first residential brokerage in the U.S. is a company called Reology, and it's made up of over a dozen acquisitions. It's public, and yet it still only has eight or nine percent of the entire market, and they're talking about a hundreds of billions of dollars annual TAM, and so if you're a startup and you can achieve one, two, three percent market share, you could build a very substantive business, and you can make a very nice return, and so Highly fragmented industries where you have a technological advantage. If you have a better mousetrap, if you have a novel go-to-market approach, you can capture a couple points of market share and create a meaningfully large company. And so while I continue to look for those unique opportunities where winner takes all and you happen to have the opportunity to invest in that winner, but more often I'm seeing fragmented marketplaces where you can back the novel entrepreneur and still build a very interesting busin…

AI assessment note: “I look at the opposite end of that spectrum, which is very highly fragmented industries”

Q I absolutely love that story. But we mentioned some of the people that we know mutually beforehand, and one being Glenn from GGV. And he said, specifically with regards to that contemplation of operator versus investor, he asked, How do the roles of CEO and VC differ, and what were the takeaways from your time in operations that really impacted your investing mentality today?

A You know, when I was thinking about the move into venture, I thought being an operator would be a differentiator. I actually underestimated how much so. When you're a CEO, you have to think about your industry, your company, your comparative and competitive differences. What is your corporate strategy? What are the few things that you're going to do well? How do you assemble a team that augments your capabilities, and how do you paint a vision that helps people achieve more collectively than they thought possible individually? And you have to then have a set of KPIs and measurements against what your progress is, and you have to remain flexible so that you have a true north and you have a clear strategy, but in the changing face of macroeconomic, competitive landscape, consumer preferences, technological leapfrogging, You have to be adaptable and flexible to that changing environment, and as you think about being a venture capitalist, you have to do many of those same things. You have to understand the industry, the value chain, what the addressable market is. Do you believe this is a management team that has clarity of vision, the capability to assemble a great team, and execute flawlessly over a long period of time to create differentiation and scale, and so they're similar but different roles. And having had a lot of investing experience, I'm able to have pattern recognition…

AI assessment note: “as you think about being a venture capitalist, you have to do many of those same things”

Q It is a fascinating world. I do have to ask, I've had many angels turn VCs on the show in the past. It was Andy McLaughlin at Uncork who said that from the transition from Angel to VC, he actually became a lot more conservative in his investing mentality. Have you seen a change in your investing mentality from Angel to now institutional VC with SoftBank?

A Yes, but I think it's the opposite. As a public CEO, you have to hit your numbers to the penny every single quarter, and you're boxed in in some ways into executing against that one strategy, and you think very carefully about your Capital allocation, your investment decisions day by day, week by week, month by month, and quarter by quarter. As a leader here at the Vision Fund, given our scale, given our long-term mentality, given the types of companies that we're investing in, we have the ability not to worry about this month or next quarter. We have the ability to help our entrepreneurs unlock the world of possibility by moving the constraints that In a way that very few other firms can do with these startups, and so we take a much longer-term view, and we're able to, I think, achieve much greater impact over a longer period of time, because those constraints are different than running a public company.

AI assessment note: “Yes, but I think it's the opposite.”

Q at often kind of sticking points within that seemingly very seamless process, one is often price. As a seed investor, it's commonly suggested price doesn't really matter. Peter Fenton said on this show, I actually never turned down a deal based on valuation. It's a mental trap, but it's very different being at a later stage. So I am interested. How do you think about your own price sensitivity today?

A Yeah, it's an interesting balance because if you look at all the historical data, both pragmatic data as well as academic data, the highest R-square determinant for investment returns is your entry price. And so any good investor needs to be valuation sensitive and But you need to couple that with what is the potential for this company and not be penny wise and pound foolish. And so if we're focused on a 10 year investment in a company, and we think this is going to be a ten billion dollar outcome, arguing over the last 20 or thirty billion dollars of valuation is often not worth it. It's better to get alignment quickly and then join forces so that we can help That company scale. We can introduce them to our ecosystem of portfolio companies. We could tap into our global network of potential customers and business development partnerships, and we could get back to the important part, which is execution. And so you have to be smart about your entry valuation, but you also have to be pragmatic about where and on what relative size are you talking about. But we're not going to overpay for deals that we think are Not going to meet our internal hurdle rates, because overall, we have a fiduciary responsibility to our LPs, and we want to do well by our entrepreneurs, but we want to do well by our LPs and our employees as well.

AI assessment note: “any good investor needs to be valuation sensitive and But you need to couple that”

Q But before we move into the quickfire round, Jeff, I do want to touch on how you really like to work with founders. As we said, spoke to many of your founders before the show, Tina Brandless being one of them. And she said, But I had to ask, how is it specifically that you like to work with your founders, Jeff?

A Yeah, having been a founder and a CEO and had been blessed with an amazing board of directors at Shutterfly, I never thought of them as early investors or as adversaries or as a boss. I thought of them as advisors, as mentors, as people that I can use as a sounding board on a multitude of decisions. And given my credibility as an operator, the way I like to work with my entrepreneurs is in that mindset of being a true partner. And the thing that gives me the most energy about my job, and there are many things, is that most of my CEOs call me at least once a week, and I don't have to call them. And it may just be, hey Jeff, I'm thinking about making a change in my CFO, or can I get your opinion about a go-to-market strategy, or I'm thinking about this M&A target, or I'm I'm thinking about changing the way we're pricing our service, and it's that credibility that I built with them, and my credibility as an operator allows me to be a value-added partner in those strategic discussions, ranging from product to marketing to technology to human resources to financing, so I like to be a partner. With that credibility comes responsibility, that our job as investors, as board members, is to be advisors, but we're not operating the company, and making that clear with the CEO's That they don't have to ask permission, and I'm here as simply an advisor, I think is an important thing to estab…

AI assessment note: “the way I like to work with my entrepreneurs is in that mindset of being a true partner.”

Q of people always suggest that we're in the longest bull market ever, and cycles cannot be avoided in certain cases, and then other people say, no, we're in a A 50 year, a hundred year secular shift with every industry being impacted by technology. How do you think about maybe the investing landscape today and where we are in terms of the macroeconomic environment and how that plays into it?

A Look, I'm a student of economics and a fact-based decision maker, and everything that we invest in at the Vision Fund is underpinned by data. We look for companies that are capturing data, analyzing that data, drawing insights, making recommendations, And ultimately moving towards actions. And if you look at the data over a long period of time, economies, both on a domestic and on a global basis, they go through cycles. And so we will have a down cycle and this, uh, bull market will come to an end. But if you look at the bear markets, even in the worst of times during the oh eight, oh nine financial crisis, that only lasted 24 months. And then we had an amazing resurgence since the bottoming in March of 2009. And so, since the Vision Fund are backing entrepreneurs that have global ambition on a very big scale, and because we're long-term oriented investors, we can be patient to ride out any of those near-term economic cycles, and because we have the balance sheet, we can support continued investment in our companies to gain additional competitive advantage when other companies, particularly incumbents, may be constrained in a different way than our investments. And I experienced that firsthand at Shutterfly. When the financial crisis hit, we went from growing 51% in 2007 down to 14% in oh eight and 16% in oh nine. But we had cash on the balance sheet. We were free cash flow pos…

AI assessment note: “we can be patient to ride out any of those near-term economic cycles”

Q said about the show, I'm probably one of the world's Biggest venture nerds. And We see so much about SoftBank in the news, and I would love to kind of start from the top today. We've seen a variety of different SoftBank deals from Uber on the high end to WAG on the slightly smaller end. Can I ask Jeff, how do you think about portfolio construction today with SoftBank?

A Yeah, it's a great question. And if you go back and look at Masa's history of investing, he caught the PC and the software wave in the beginning of his career in the formation of SoftBank, which was really Software Bank when it first started. He then saw the adoption of the internet. Then it was broadband and mobility. And today it's the convergence of artificial intelligence, machine learning, data science, and the merger between human and machine. And so we're riding these very large technological shifts that aren't going to happen over one or two years, but they're going to happen over decades. And when you paint that picture and you think about that as a ultimate vision, what we're trying to achieve is to give freedom level capital, Connections and counsel to our portfolio companies to allow them to scale on a global basis and to invest in R&D and technological differentiation on a massive scale, and so it's really exciting, and we have the flexibility in our fund to do early stage, mid stage, late stage, to do private, to do public, to do minority investments, to do majority investments, but our sweet spot is meaningful size minority investments in mid to late stage And that cuts across many different industries from biotech to robotics to consumer to real estate to logistics to fintech to enterprise software to infrastructure across the globe. And so that flexibility allo…

AI assessment note: “our sweet spot is meaningful size minority investments in mid to late stage”

Q But post the initial and reserve investment, there is a time when one investor looks for liquidity at some point. Having extended the window of privatization, as a lot of people say, through your own vehicle being much larger than other vehicles, how do you and the team think about liquidity today, Jeff?

A Yeah, so we're a twelve-year fund with two one-year extensions, so we're a fourteen-year fund pragmatically, and we're only 22 months into that journey. While we want liquidity events and every investor needs and wants those at some point, it's really not our focus today. So we're helping companies optimize the ultimate size of the franchise and the asset because we're not short-term minded, and we recognize that we come in later stage, We provide more capital that may elongate that exit, and so in more than half of our investments, we have provided a secondary component for seed and early-stage investors to have liquidity, which I think is very healthy for the ecosystem because they get liquidity, they reinvest that money into new startups, and that just continues the virtual cycle, and it allows them to raise new funds, and we're providing a broader global platform for entrepreneurs in today's economy. And so I think it's a symbiotic relationship that a fund of our size, scale, and stage, as with many of the other players, both here in Silicon Valley, in London, in Mumbai, in Jakarta, and throughout the entire world. And so we're willing to provide liquidity for early stage investors.

AI assessment note: “While we want liquidity events... it's really not our focus today.”

Q said about the show, I'm probably one of the world's Biggest venture nerds. And We see so much about SoftBank in the news, and I would love to kind of start from the top today. We've seen a variety of different SoftBank deals from Uber on the high end to WAG on the slightly smaller end. Can I ask Jeff, how do you think about portfolio construction today with SoftBank?

A Yeah, it's a great question. And if you go back and look at Masa's history of investing, he caught the PC and the software wave in the beginning of his career in the formation of SoftBank, which was really Software Bank when it first started. He then saw the adoption of the internet. Then it was broadband and mobility. And today it's the convergence of artificial intelligence, machine learning, data science, and the merger between human and machine. And so we're riding these very large technological shifts that aren't going to happen over one or two years, but they're going to happen over decades. And when you paint that picture and you think about that as a ultimate vision, what we're trying to achieve is to give freedom level capital, Connections and counsel to our portfolio companies to allow them to scale on a global basis and to invest in R&D and technological differentiation on a massive scale, and so it's really exciting, and we have the flexibility in our fund to do early stage, mid stage, late stage, to do private, to do public, to do minority investments, to do majority investments, but our sweet spot is meaningful size minority investments in mid to late stage And that cuts across many different industries from biotech to robotics to consumer to real estate to logistics to fintech to enterprise software to infrastructure across the globe. And so that flexibility allo…

AI assessment note: “our sweet spot is meaningful size minority investments in mid to late stage”

Q It is a fascinating world. I do have to ask, I've had many angels turn VCs on the show in the past. It was Andy McLaughlin at Uncork who said that from the transition from Angel to VC, he actually became a lot more conservative in his investing mentality. Have you seen a change in your investing mentality from Angel to now institutional VC with SoftBank?

A Yes, but I think it's the opposite. As a public CEO, you have to hit your numbers to the penny every single quarter, and you're boxed in in some ways into executing against that one strategy, and you think very carefully about your Capital allocation, your investment decisions day by day, week by week, month by month, and quarter by quarter. As a leader here at the Vision Fund, given our scale, given our long-term mentality, given the types of companies that we're investing in, we have the ability not to worry about this month or next quarter. We have the ability to help our entrepreneurs unlock the world of possibility by moving the constraints that In a way that very few other firms can do with these startups, and so we take a much longer-term view, and we're able to, I think, achieve much greater impact over a longer period of time, because those constraints are different than running a public company.

AI assessment note: “Yes, but I think it's the opposite. As a public CEO”