The Exchanges

Q Can I ask, if you unpack process decisions, is it just the people in the room that are actually voting on the actual core asset decision, or is it a change of process as well? How does that, if you unpack a process decision, what's involved in it?

A Well, a process decision empowers usually five, six, seven people to literally run the whole process and make the final decision and report back to the rest of the group, whatever they decided. What we do practically speaking here is we have two slots every week. They're an hour and a half long. The companies come in for an hour, and then there's a half an hour for the process team or the team that has the power to make the decision to meet by themselves. And it doesn't always happen in one session. These things might go on over weeks Two weeks, and one other thing we try to do is we try to keep that same group of people for all the follow-on decisions that happen later for a given company. That way there's accountability down the road.

AI assessment note: “a process decision empowers usually five, six, seven people to literally run the whole process”

Q there never seems to be enough money. And I know you've done some pretty intense data work from NEA's side on kind of portfolio company allocations and concentrations into the winners. And so if we start on like the capital concentration element, can you walk me through that and how much did the companies raise over the last decade? Of that, how much did NEA do? What were your takeaways?

A Well, what you're referring to, Harry, is the study we did over the last 10 years. We just looked at our growth investments and our conviction investments, which are two slightly separate things, but think of them as our best companies where we've deployed large amounts of capital, and yet even though we feel like we've deployed a large amount of capital, this particular collection of companies has raised thirty-two billion dollars in total, and we've only been responsible for three billion of it. So that's kind of great. Our companies have had access to all this company. The problem is that that particular basket of companies, which is a sizable basket, over the period of a decade have generated a return of 36% on average every year. So only doing three billion of it seems like we're leaving a lot of money on the table.

AI assessment note: “raised thirty-two billion dollars in total, and we've only been responsible for three billion”

Q there never seems to be enough money. And I know you've done some pretty intense data work from NEA's side on kind of portfolio company allocations and concentrations into the winners. And so if we start on like the capital concentration element, can you walk me through that and how much did the companies raise over the last decade? Of that, how much did NEA do? What were your takeaways?

A Well, what you're referring to, Harry, is the study we did over the last 10 years. We just looked at our growth investments and our conviction investments, which are two slightly separate things, but think of them as our best companies where we've deployed large amounts of capital, and yet even though we feel like we've deployed a large amount of capital, this particular collection of companies has raised thirty-two billion dollars in total, and we've only been responsible for three billion of it. So that's kind of great. Our companies have had access to all this company. The problem is that that particular basket of companies, which is a sizable basket, over the period of a decade have generated a return of 36% on average every year. So only doing three billion of it seems like we're leaving a lot of money on the table.

AI assessment note: “has raised thirty-two billion dollars in total, and we've only been responsible for three billion”

Q In terms of this physics being different, it has driven, obviously, so much more capital into the industry than ever before, really. And I had Bill Gurley on the show quite recently, and he said that the oversupply of capital is really his biggest challenge to date. Would you agree with that perspective? What do you think actually the capital needs have just adjusted to the opportunities that are offered?

A I think it certainly can be a challenge, but it's frankly also a wonderful thing in many ways. I mean, companies are staying private for longer, even though it's cheaper to start a company still takes a lot of capital to grow a company. And so a firm like Benchmark would be frankly in real trouble if there wasn't enormous amounts of capital because they only do series A and series B deals and they hope other people are going to come along and carry their companies after them. So I think it's a little ironic that Bill would be pointing that out. Certainly that's more of a challenge for a late stage investor, but I think there's always a balance and sometimes there's a little too much. Sometimes there's a little too little, but the reality is that the timeframe to liquidity has stretched out quite a lot. In 1999, it was something like two and a half years from inception to IPO. And now it's more like six or seven. And at one point it was nine or 10. And those companies that are being built are growing faster than ever, which by the way, for most of them means they consume more capital than ever. So I don't Quite agree with Bill. I think a related idea is liquidity. I think liquidity has been a challenge because when you stretch out the time in the private market, all the participants are challenged to be able to have holding periods that long. But on the other hand, those longer …

AI assessment note: “So I don't Quite agree with Bill.”

Q What motto or quote do you most frequently revert back to, Scott? You left me on a cliffhanger earlier, so I'm excited for this.

A Oh, yeah. Well, so on my application to Dartmouth all those years ago, they asked you to pick a quote. I don't know how I came across it, but it's It's the Teddy Roosevelt quote that you've heard, I'm sure, before. It's not the critic who counts, not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who's actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs, who comes short again and again because there's no effort without error and shortcoming, but who does actually strive to do the deeds, who knows the great enthusiasms, the great devotions, who spends himself in a worthy cause, Who at best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails, while daring greatly, so that his place shall never be with those cold and timid souls who know neither victory nor defeat.

AI assessment note: “It's the Teddy Roosevelt quote that you've heard, I'm sure, before.”

Q One thing that I struggle with is, you know, I've never seen macro crises in terms of, you know, crashes and busts in my investing career. Super interested in terms of that. Josh Cochenbrun said on the show that they made him much more conservative seeing the booms and the busts. How now seeing multiple boos and busts, how has that impacted your investing mindset?

A Well, you know, it's really interesting, Harry, because if you just go back 25 years or whatever it's been, there have been two big busts, obviously, the dot-com bust in 99, 2000, and then the global financial crisis. And one of the things that seems a little frightening is that those things have occurred about 10 years apart, and the average venture capital investment is somewhere between eight and 10 years nowadays. So you're investing every day with an investment horizon that Probably realistically anticipates a bust at some point before you get out, and so that's a little bit of a frightening thing. I think the practical reality is that the only way you can deal with that is to be very careful with capital and always have enough capital to last a while should there be some kind of a bust, because typically in busts, the availability of capital goes away. Not only do valuations come down, but in the busts, usually there just isn't capital at any price. So you have to make sure you always have a reserve on your balance sheet, and I think you also have to have a business plan that allows you to make rapid adjustments to using a lot less capital for a period of time.

AI assessment note: “the only way you can deal with that is to be very careful with capital”

Q speak there for the asset class of venture. When we think about, like, the company building aspect, again, another thing that you said to me before, which I really wanted to double down on, was the Core physics of company building have changed, and so when I was thinking about it, I'd love to hear your thoughts. What did you mean by this, and how have they changed so fundamentally?

A Yeah, this sort of dawned on me, I don't know, six or seven years ago. It again comes back to the internet, really, I think, is the fundamental change which has enabled the physics of building companies to change, and I think it's why we see companies growing so much faster than we ever did in history. When I first hypothesized this idea that the physics of building businesses had changed, I looked at software businesses because I know software well. I had one of our associates look at the growth rate of software companies over three decades, the nineties, the 2000, and the decade just ended. And I remembered that in the nineties, which was the client server era, it was called, it was a heyday for software. And there were a lot of great software companies that went public in that time. But interestingly enough, in the seven quarters after the IPO, the average company grew 18%. And that was considered fantastic. You couldn't get funded today if all you were doing was growing 18%. In the decade that followed, they grew 28%, and the decade just ended 50%, or something close to that. This is the average of newly public companies, and so you sort of have to unpack that and say, well, how could that be? And when you look at all of the different atomic elements of building a business, each of them have changed, and some of them have changed a lot. Just the development of software is n…

AI assessment note: “comes back to the internet, really, I think, is the fundamental change”

Q Well, that is so kind of you, but I would love to start with a little bit on you, so tell me, how did you make your way into what I call the wonderful world of venture, and how did you come to be managing general partner at one of the most iconic firms that we have today in NEA?

A Well, obviously a lot of good luck along the way, but the story is back in 1996, when I first had the chance to join NEA, people didn't think about joining a venture firm by design. They just got lucky. There were only a few jobs available in the whole industry in a given year. People didn't plan on having a career in venture capital, but some of us were lucky enough to be asked. And in my case, what happened was I had left Microsoft and I was doing some consulting work for For a company, they asked me to help them pitch venture capitalists. This is before the day of video conferencing, so NEA had an office in Baltimore and an office in Menlo Park, and someone introduced us to the NEA team in Baltimore, and we went out for a meeting, and after the meeting, Peter Barris, who was the managing partner just before me for 20 years, I guess called Tom McConnell, one of the general partners in our Menlo Park office, and said, hey, we had a pitch from this guy, Scott Sandell, and we're sending him out to see you guys next week, but see if you think he might be good for us. And so after the meeting in Menlo Park, Tom called me, and after a bunch of interviews, at that time, you would interview with literally everybody in the firm, and so at the end of all of that, they offered me a job right before Christmas in 1995, and I joined in January of 96 as an associate, and I think that's 26 y…

AI assessment note: “they offered me a job right before Christmas in 1995, and I joined in January”

Q You spoke about kind of the scaling fund sizes there. With the scaling fund sizes, obviously you have scaling team sizes and scaling partnerships, and decision making is obviously kind of the crucial, most valuable element of our industry in terms of preserving it. In terms of like ensuring the same quality of decision making, how do you think about preserving that quality with the increase in partnership size?

A Well, first of all, the partnership has probably grown 50% in my 25 years. So it hasn't grown that dramatically. What we've realized along the way is that with these much longer holding periods and ultimately bigger capital requirements for these companies, you don't need a much bigger team to do this. But in terms of decision-making process itself, we are firm believers that the best decisions are made in relatively small groups. And since we have a relatively larger group and everybody wants to be in the room where it happens, so to speak, that's always a challenge for us. We kind of go back and forth between who gets to Participate and not, but fundamentally, we try to keep group size to a relatively small level. One thing we came up with a few years back, because it was an idea of Chip Linehan's, I think one of our now retired general partners, something called a process decision, which is just to say all the general partners get to vote on the process, but they don't get to vote on the investment, and the process usually involves a significantly smaller number of people than the number of general partners. We have a dozen general partners, but The average process decision would empower five or six of them to make a decision, and the test that we're always looking for is that those are the right five or six people, that anybody in the firm would look at that five or six peo…

AI assessment note: “something called a process decision, which is just to say all the general partners get to vote”

Q because it's been a long journey, and it's also had ups and downs, and it causes a lot of change in people. When you look at the team, I'd love to understand how We see Vlad in particular today, and he's a very public, controlled figure. In terms of how they've changed and evolved, how have the team changed and evolved, and were there moments where you saw that happen?

A Well, I mean, yeah, of course they've changed and evolved somewhat, but I actually think of Vlad as not that different than when I first met him, you know, back in 2012 or 20 13 or whatever it is. I mean, he's an incredibly consistent guy. He's very, very smart. He's very thoughtful. He's very unflappable. He's a great leader. He has evolved in terms of his capabilities, but I think the man himself, he's very much the same as he was before, and he's served the company incredibly well that way. I think what I think of more generally when I think of the evolution of the team is how Beju and Vlad always aimed really high, and this was at a time in Silicon Valley where all of our startups, or most of them, were complaining about how Google and Facebook in particular were just throwing their checkbooks around and buying up talent at prices that startups Couldn't compete with. That was the standard boardroom conversation, as I'm sure you remember. And yet, I would go to the Robin Hood board meetings, and they never complained. And when we would talk about how hiring was going for this position or that position, it was more likely that they were poaching some senior executive from Facebook rather than losing a competition to get somebody from Facebook. They always aimed high, and they were remarkably good at hitting the mark.

AI assessment note: “I actually think of Vlad as not that different than when I first met him”

Q Can I ask Scott for you, when you look back, what do you think was some of the most surprising elements about their evolution? And it could be, and specifically around the business and the product, it could be the monetization methods. It could be the product direction or some kind of big strategic things that happened that unexpected in your mind.

A Well, I think one of the things that has stood out about this company from the very earliest days, Rick Already touched on, which is engagement. Engagement metrics were always incredibly impressive, and so was the growth in users. Without spending a penny, they were growing organically at scale in a way that I don't think any other consumer internet property was growing at the time, and they did it for years and years and years, so that really, really stood out to me, but I think the third thing, which Rick also alluded to, is the cost structure. You know, it was designed from the beginning to be self-serve, basically completely automated with software, and that turns out to be an enormous advantage in a business Where you're trying to offer something for free.

AI assessment note: “one of the things that has stood out about this company from the very earliest”

Q Can I ask Scott for you, when you look back, what do you think was some of the most surprising elements about their evolution? And it could be, and specifically around the business and the product, it could be the monetization methods. It could be the product direction or some kind of big strategic things that happened that unexpected in your mind.

A Well, I think one of the things that has stood out about this company from the very earliest days, Rick Already touched on, which is engagement. Engagement metrics were always incredibly impressive, and so was the growth in users. Without spending a penny, they were growing organically at scale in a way that I don't think any other consumer internet property was growing at the time, and they did it for years and years and years, so that really, really stood out to me, but I think the third thing, which Rick also alluded to, is the cost structure. You know, it was designed from the beginning to be self-serve, basically completely automated with software, and that turns out to be an enormous advantage in a business Where you're trying to offer something for free.

AI assessment note: “Engagement metrics were always incredibly impressive, and so was the growth in users.”

Q I entirely agree with you in terms of that kind of worried about what you don't know. In terms of kind of the bust there that we mentioned, despite that, you know, you've said before to me that it's an incredible time for the asset class. If we're going to dig into this, what makes you say about the incredible time for the asset class for you, do you think?

A Well, I think there's two things, Harry. One is in the innovation economy itself, and then the other is in the private equity market. So let me start with the innovation economy. And this is what you and everyone can plainly see, which is that The world is digitizing itself rapidly, and actually, that transformation has accelerated with COVID-IX, as we can all plainly see, and so, if you think about it as the balance of power shifting from the incumbents to the upstarts, that's what I see happening every day in one new market after another, with one new technology after another, and I think the result will be that some very iconic companies are being built today that will be the Exxon's and General Motors of Tomorrow, or the IBMs, and we've already seen a handful of examples. The FANG companies have already shown us what kind of upside is available, and not all of them will turn out that way, but I think there's no doubt that some of the companies being created today will be enormously valuable and impactful over a long period of time.

AI assessment note: “there's two things, Harry. One is in the innovation economy itself”

Q I love that suggestion. I do want to say, you know, obviously with the overspied capital, that becomes real pricing pressure in terms of upwards Pricing pressure. Another one that I'd love your advice on bluntly is like, how do you think about price sensitivity? How do you determine when to pay up versus when to remain disciplined? And what would you advise me with that respect with your learnings?

A Well, I mean, I think the old adage that great deals are worth paying up for is true in any market, but that doesn't mean that all expensive deals are great. And so the tough thing is to figure out when to pay up and when not to pay up. But I think in a, an environment where there is this tremendous amount of capital and Sources of capital at all stages of company formation today. You can assume that in almost all cases, great deals will be priced at what appears to be a premium at any given point in time. And so what I always do is I think about, is this something that's going to grow so extraordinarily fast that I will soon be very comfortable with this price. If it's a software company growing over a hundred percent a year, and I really believe that that's That's going to continue to happen for some period of time. Then I can justify paying a price that not too far down the road, maybe 18 or 24 months, or maybe even a year start to look cheap. I mean, that's kind of what I'm hoping for. But of course, even in this environment, we've seen situations where that sort of logic that served me well for a long time is completely invalidated by the fact that people are going to pay a price that I'm not going to be comfortable with for many years, even with extraordinary growth. So it's a tricky time.

AI assessment note: “is this something that's going to grow so extraordinarily fast that I will soon be”

Q Can I ask, you know, you've been on so many boards and so many impactful boards. When you look at, say, me in the first two or three years of their career as a board member, what would you advise me with the many years of hindsight and experience that you have?

A You know, one of the things I did, Harry, when I was just starting out that was really helpful is I realized that one of the great things about the venture business is that you get to work with people in other firms. In fact, oftentimes you'd work less with your own partners. So I tried early on to, you know, if I was the series A investor, I'd try to get somebody to lead the series B who I thought was going to be a more experienced, great board member, and then I'd learn from them. Or conversely, if some really great Person who I admired had done the series A, I'd try to get on that board and learn from them. You know, I think every board is a learning opportunity, and then I try to check myself, and you know, I like to talk a lot sometimes, so I just have to check that instinct and say, just listen, let's see what other people have to say.

AI assessment note: “one of the things I did, Harry, when I was just starting out that was really helpful”

Q Can I ask what's been the most challenging change that's occurred?

A To me, probably the most challenging thing is that if you go back to where I started, There were very few jobs in venture capital, and it was a relatively small field. It seems like everybody wants to be a venture capitalist now. That creates some real exuberance and some challenges. At the simplest level, it's harder and harder to differentiate yourself as a venture capitalist when people will come along and offer valuations that might be, in your mind, sort of absurd, and so we've been facing this challenge now for a number of years, but it doesn't get easier. It just gets harder, and I really feel for the young people in the industry who Are working really earnestly to learn the profession and to develop the skill set to not only evaluate investment opportunities, but to help entrepreneurs. And I think it's harder and harder for them to differentiate themselves, certainly than it was back in my day.

AI assessment note: “harder and harder to differentiate yourself as a venture capitalist”

Q You spoke about kind of the scaling fund sizes there. With the scaling fund sizes, obviously you have scaling team sizes and scaling partnerships, and decision making is obviously kind of the crucial, most valuable element of our industry in terms of preserving it. In terms of like ensuring the same quality of decision making, how do you think about preserving that quality with the increase in partnership size?

A Well, first of all, the partnership has probably grown 50% in my 25 years. So it hasn't grown that dramatically. What we've realized along the way is that with these much longer holding periods and ultimately bigger capital requirements for these companies, you don't need a much bigger team to do this. But in terms of decision-making process itself, we are firm believers that the best decisions are made in relatively small groups. And since we have a relatively larger group and everybody wants to be in the room where it happens, so to speak, that's always a challenge for us. We kind of go back and forth between who gets to Participate and not, but fundamentally, we try to keep group size to a relatively small level. One thing we came up with a few years back, because it was an idea of Chip Linehan's, I think one of our now retired general partners, something called a process decision, which is just to say all the general partners get to vote on the process, but they don't get to vote on the investment, and the process usually involves a significantly smaller number of people than the number of general partners. We have a dozen general partners, but The average process decision would empower five or six of them to make a decision, and the test that we're always looking for is that those are the right five or six people, that anybody in the firm would look at that five or six peo…

AI assessment note: “all the general partners get to vote on the process, but they don't get to vote on the investment”

Q to maintain such high levels of trust when partnerships are just a little bit larger, bluntly. What do you think is the secret? Because I spoke to Vanessa about this, and she mentioned the incredible chemistry that you have as a Partnership and the trust that you guys actually have as a partnership. What do you think is the secret to retaining such trust within a larger group of people?

A Well, obviously we're careful in the hiring process. And the first thing that we look for that I'm sure everybody looks for in their organization is what we call fit. You know, is this person a fit with what we are? And we don't want them to be identical to who everybody else is already. We want to always be evolving and changing and open to new ideas and even to new thoughts and values. But what we do do is Once we've hired people, we're watching very carefully to see whether their behavior matches our values and our culture, and really that's the one thing that causes people to leave NEA on a relatively premature schedule. Otherwise, we're a pretty patient organization giving people time to develop, but that's the thing we stick to.

AI assessment note: “watching very carefully to see whether their behavior matches our values and our culture”

Q cold, hard-walled adventure, which is a seamless transition for me to make. I do have to ask, you know, you mentioned, obviously, entering the industry there in January, nineteen-six. It's been through such changes over the last, whatever that It's been really 25 years. I have to ask, what would you say is the single biggest changes, and what's been kind of some of the most challenging and the best?

A Well, I was thinking about that last night, Harry. You know, I don't think it'll surprise you, but I really think the biggest change is the internet. The internet has changed everything. Even though we invest in information technology and healthcare, but the internet's even changing healthcare in dramatic ways. Telemedicine, healthcare delivery, the ability to amalgamate data across the globe on healthcare outcomes and use that in research. And then, of course, all the things we know about the way that the world is being digitized, none of that would really be possible without ubiquitous connectivity to all the devices that we know and love. And we can talk more about how the internet changed the venture capital industry itself, but I think the internet is the most fundamental thing that's come along in my lifetime.

AI assessment note: “I really think the biggest change is the internet. The internet has changed everything.”

Q to maintain such high levels of trust when partnerships are just a little bit larger, bluntly. What do you think is the secret? Because I spoke to Vanessa about this, and she mentioned the incredible chemistry that you have as a Partnership and the trust that you guys actually have as a partnership. What do you think is the secret to retaining such trust within a larger group of people?

A Well, obviously we're careful in the hiring process. And the first thing that we look for that I'm sure everybody looks for in their organization is what we call fit. You know, is this person a fit with what we are? And we don't want them to be identical to who everybody else is already. We want to always be evolving and changing and open to new ideas and even to new thoughts and values. But what we do do is Once we've hired people, we're watching very carefully to see whether their behavior matches our values and our culture, and really that's the one thing that causes people to leave NEA on a relatively premature schedule. Otherwise, we're a pretty patient organization giving people time to develop, but that's the thing we stick to.

AI assessment note: “we're careful in the hiring process... watching very carefully to see whether their behavior matches”

Q I entirely agree with you in terms of that kind of worried about what you don't know. In terms of kind of the bust there that we mentioned, despite that, you know, you've said before to me that it's an incredible time for the asset class. If we're going to dig into this, what makes you say about the incredible time for the asset class for you, do you think?

A Well, I think there's two things, Harry. One is in the innovation economy itself, and then the other is in the private equity market. So let me start with the innovation economy. And this is what you and everyone can plainly see, which is that The world is digitizing itself rapidly, and actually, that transformation has accelerated with COVID-IX, as we can all plainly see, and so, if you think about it as the balance of power shifting from the incumbents to the upstarts, that's what I see happening every day in one new market after another, with one new technology after another, and I think the result will be that some very iconic companies are being built today that will be the Exxon's and General Motors of Tomorrow, or the IBMs, and we've already seen a handful of examples. The FANG companies have already shown us what kind of upside is available, and not all of them will turn out that way, but I think there's no doubt that some of the companies being created today will be enormously valuable and impactful over a long period of time.

AI assessment note: “One is in the innovation economy itself, and then the other is in the private equity”

Q I love that suggestion. I do want to say, you know, obviously with the overspied capital, that becomes real pricing pressure in terms of upwards Pricing pressure. Another one that I'd love your advice on bluntly is like, how do you think about price sensitivity? How do you determine when to pay up versus when to remain disciplined? And what would you advise me with that respect with your learnings?

A Well, I mean, I think the old adage that great deals are worth paying up for is true in any market, but that doesn't mean that all expensive deals are great. And so the tough thing is to figure out when to pay up and when not to pay up. But I think in a, an environment where there is this tremendous amount of capital and Sources of capital at all stages of company formation today. You can assume that in almost all cases, great deals will be priced at what appears to be a premium at any given point in time. And so what I always do is I think about, is this something that's going to grow so extraordinarily fast that I will soon be very comfortable with this price. If it's a software company growing over a hundred percent a year, and I really believe that that's That's going to continue to happen for some period of time. Then I can justify paying a price that not too far down the road, maybe 18 or 24 months, or maybe even a year start to look cheap. I mean, that's kind of what I'm hoping for. But of course, even in this environment, we've seen situations where that sort of logic that served me well for a long time is completely invalidated by the fact that people are going to pay a price that I'm not going to be comfortable with for many years, even with extraordinary growth. So it's a tricky time.

AI assessment note: “is this something that's going to grow so extraordinarily fast that I will soon be very comfortable”

Q Well, that is so kind of you, but I would love to start with a little bit on you, so tell me, how did you make your way into what I call the wonderful world of venture, and how did you come to be managing general partner at one of the most iconic firms that we have today in NEA?

A Well, obviously a lot of good luck along the way, but the story is back in 1996, when I first had the chance to join NEA, people didn't think about joining a venture firm by design. They just got lucky. There were only a few jobs available in the whole industry in a given year. People didn't plan on having a career in venture capital, but some of us were lucky enough to be asked. And in my case, what happened was I had left Microsoft and I was doing some consulting work for For a company, they asked me to help them pitch venture capitalists. This is before the day of video conferencing, so NEA had an office in Baltimore and an office in Menlo Park, and someone introduced us to the NEA team in Baltimore, and we went out for a meeting, and after the meeting, Peter Barris, who was the managing partner just before me for 20 years, I guess called Tom McConnell, one of the general partners in our Menlo Park office, and said, hey, we had a pitch from this guy, Scott Sandell, and we're sending him out to see you guys next week, but see if you think he might be good for us. And so after the meeting in Menlo Park, Tom called me, and after a bunch of interviews, at that time, you would interview with literally everybody in the firm, and so at the end of all of that, they offered me a job right before Christmas in 1995, and I joined in January of 96 as an associate, and I think that's 26 y…

AI assessment note: “offered me a job right before Christmas in 1995, and I joined in January of 96”

Q because it's been a long journey, and it's also had ups and downs, and it causes a lot of change in people. When you look at the team, I'd love to understand how We see Vlad in particular today, and he's a very public, controlled figure. In terms of how they've changed and evolved, how have the team changed and evolved, and were there moments where you saw that happen?

A Well, I mean, yeah, of course they've changed and evolved somewhat, but I actually think of Vlad as not that different than when I first met him, you know, back in 2012 or 20 13 or whatever it is. I mean, he's an incredibly consistent guy. He's very, very smart. He's very thoughtful. He's very unflappable. He's a great leader. He has evolved in terms of his capabilities, but I think the man himself, he's very much the same as he was before, and he's served the company incredibly well that way. I think what I think of more generally when I think of the evolution of the team is how Beju and Vlad always aimed really high, and this was at a time in Silicon Valley where all of our startups, or most of them, were complaining about how Google and Facebook in particular were just throwing their checkbooks around and buying up talent at prices that startups Couldn't compete with. That was the standard boardroom conversation, as I'm sure you remember. And yet, I would go to the Robin Hood board meetings, and they never complained. And when we would talk about how hiring was going for this position or that position, it was more likely that they were poaching some senior executive from Facebook rather than losing a competition to get somebody from Facebook. They always aimed high, and they were remarkably good at hitting the mark.

AI assessment note: “I actually think of Vlad as not that different than when I first met him”

Q the high prices. We mentioned SPACs though, so Scott, while I have, I do have to ask about this, the unprecedented rise. How do you feel about it? And I guess, how do you advise portfolio companies now who have this, although it's not an entirely new mechanism, the option of it is, how do you advise them on the option to do so? How do you think about that?

A As I mentioned a minute ago, Harry, that I think one of the big challenges of our time is liquidity. And so SPACs are obviously a new form of liquidity for private companies. And frankly, what appears to me to be a new source of risk capital. These are people who want to invest through this vehicle and ultimately be able to have near-term liquidity in the public markets, but seem to be relatively risk preferring compared to the traditional IPO investors, or at least the traditional IPO offering method, if you will. So I think it's great. It's all new sources of liquidity are welcome. There'll probably be some exuberances and not all of them will work, but to the extent that there are paths of liquidity for some of our companies, I'm thrilled to see it.

AI assessment note: “I think it's great. It's all new sources of liquidity are welcome.”

Q the board side, which is a big amount of time that we spend in terms of our time allocation. I spoke to many founders that you sit on the board with. It was Ahmed, the one concern, who said about the transformational role that you've played on his board, and he wanted to hear, how do you describe your style of board membership, and how has it changed over time?

A I think the thing that's been most profoundly obvious to me is what a courageous act it is to be an entrepreneur, and so I try to support that, and I try to walk in the shoes of the entrepreneur before I utter something to them that might change their course, and I always try to look at each situation fresh as it is on the day, which is to say, recognize that every business plan is dead the minute you start executing on it, and then you're facing new circumstances, and So when I get to a board meeting, I don't look at whether they missed the milestones, which of course I care about, but I look at how they respond to that and what opportunity sits in front of them, given where they are and what's transpired since the last meeting and try not to be too judgmental about it.

AI assessment note: “I try to walk in the shoes of the entrepreneur before I utter something”

Q the board side, which is a big amount of time that we spend in terms of our time allocation. I spoke to many founders that you sit on the board with. It was Ahmed, the one concern, who said about the transformational role that you've played on his board, and he wanted to hear, how do you describe your style of board membership, and how has it changed over time?

A I think the thing that's been most profoundly obvious to me is what a courageous act it is to be an entrepreneur, and so I try to support that, and I try to walk in the shoes of the entrepreneur before I utter something to them that might change their course, and I always try to look at each situation fresh as it is on the day, which is to say, recognize that every business plan is dead the minute you start executing on it, and then you're facing new circumstances, and So when I get to a board meeting, I don't look at whether they missed the milestones, which of course I care about, but I look at how they respond to that and what opportunity sits in front of them, given where they are and what's transpired since the last meeting and try not to be too judgmental about it.

AI assessment note: “I don't look at whether they missed the milestones, which of course I care about”

Q Samuel Charles said before, that like, the next generation of early stage managers will have to navigate secondary liquidity markets very well in terms of returning cash to their investors, maybe pre-liquidity events traditionally. How do you think, and how would you advise, say, me, an early stage seed manager, in terms of thinking about liquidity events in the secondaries market? And how would you advise me with that respect?

A Well, I do think that the secondary markets Are really at an inflection point, and there's more and more capital flowing into the secondary markets. You know, we've seen it, of course, first for entrepreneurs. There's been a pretty robust secondary market available to entrepreneurs, and I think it's starting to become available to the venture firms themselves, and that will probably be, you know, an important way to manage early, early stage funds like yours. Our strategy is a little different because we have a multi-stage fund, so we can fund it ourselves, but I think it'll be helpful to everyone. Liquidity is a valuable thing. And it has been in very short supply for the better part of the last decade. And just what in the last two years with the IPO markets really opening up, we're suddenly seeing that all these goodies that were trapped in the private markets are actually highly desirable and very valuable in the public markets, which, you know, I think is what has led to this SPAC phenomena that we might want to talk about at some point.

AI assessment note: “that will probably be, you know, an important way to manage early, early stage funds”