Gerstner: The bottom 20-40% of tech and VC workforces dilute results
Brad Gerstner · Brad Gerstner: How I Pick Companies; Lessons from Warren Buffet; Chamath vs Gurley | E935 · 20VC with Harry Stebbings · Oct 10, 2022 · at 1:02:23
Brad Gerstner, founder of Altimeter Capital, discusses team size and organizational efficiency during an interview on 20VC.
0:00 / 0:24exact quote · 24.8s
▶ Watch the full episode on YouTube → 720p mp4 · rendered on demand · StarZero watermark
“I would say the vast majority of organizations, ok, and I'm talking from Facebook and Twitter, all the way down to, ah, GPs. They would be well served, right, to be much smaller, to be essentialists in the people that they have. Because it's very likely that your bottom 20 or 30 or 40% of your organization is dilutive, not accretive to your results.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Brad Gerstner
Gerstner: LPs should mark down 2020-2022 late-stage venture portfolios by 50%
“I said, I would take everything in your portfolio that received a valuation over the last two years, over five hundred million dollars, and I'd mark it down by 50%. What do you mean? And I said, well, if I look at the average gross stock in the NASDAQ, it's do…”
Gerstner: Venture capital funds of $10B or more cannot generate alpha
“Deploying a ten billion dollar fund or, God forbid, a fifty billion or a hundred billion dollar fund like Masa tried to do, right? You already know you will not generate alpha in that. You are getting the beta of the global tech industry when you're investing …”
Gerstner: Portfolio diversification is a myth that fails to mitigate risk
“I think diversification in many ways is the greatest myth perpetrated on the investing public. The idea that risk mitigation is the equivalent of diversification.”
Gerstner: Altimeter invested over 30% of its debut fund into Snowflake
“Our first fund VC won hell. I couldn't even raise it. I was 20 or 25% of the fund. And I put, we put over 30% of that fund in Snowflake at a point in time that the world thought we were crazy.”