The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 76 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 3 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Suster: VCs settled with embezzling founder, getting equity but zero cash
“It's one step worse than that, which is, I know of a company in which the founder embezzled money. Ok, literally stole millions of dollars. In order to not end up in a big legal battle, their VCs ended up settling, and they got all the stock back, but none of …”
Suster: SoftBank, Tiger, Coatue, and Insight marked 60% of 2021-2022 unicorns
“Of the 1260% were marked by four firms, ok? SoftBank, Tiger, Coachu, and Insight.”
Suster: Investors entering generative AI from 2023-2025 won't see strong returns
“So if you're betting on generative AI for the first time in 23, 24, 25, good luck making returns.”
Suster predicts party rounds will perform worst over the next three years
“And party rounds did incredibly well. For the last five years, but I suspect party rounds are going to do the worst for the next three years, because getting conviction across three or four small investors that each own seven, eight, nine, 10% of your company …”
Suster: Founders should avoid demo days and batch fundraising hype
“Like, you've got one company, and there's no divorce clause from investors, so I really think entrepreneurs need to take the time to get to know their investors, which is why I'm not a big proponent of demo days, or overhyping your company, or Waiting to meet …”
Mark Suster: 2021 tech overvaluations were worse than dot-com bubble
“1998, 99, 2000 are nothing compared to the overvaluations of twenty-twenty-one.”
Mark Suster: Venture market correction will take another five years
“So we're two years into a correction. I think it's going to take another five.”
Suster: Tech industry will see many more startup frauds exposed
“You're already seeing it, you know, we're reading about it, like, almost monthly in the press. Yes, you're gonna see a lot more of it.”
Upfront Ventures sold $1.2B in secondary positions during 2021 peak
“We sold 1.2 billion dollars worth of positions in 2021. When everyone was writing crazy checks, I sold six hundred million dollars that year.”
Suster: Private equity buyouts and secondaries will drive future venture capital returns
“Where, where are returns going to come from? They're going to come from private equity. So private equity firms are going to step in and buy assets from venture capital funds. They will either buy A company or they will buy secondary.”
Suster: 1,000 startups funded in 2021-2022 will never exit at $1B+
“Of the 1221 and 22 that were funded, my guess is a thousand of them will never achieve an exit value of a billion dollars or more.”
Suster: Upfront generated $1.4B from six hard-to-fund, capital-efficient startups
“On average of our companies that take longer and that we had reserves for. On average, it took six years to raise a growth round. Okay. But those companies by definition are more capital efficient because they didn't have access to it. I have six deals that fi…”
Suster: Fast-growing startup rejected $350M acquisition offer before crashing to $0
“And then I had one big company that was incredibly fast growing is the fastest growing company I had ever seen. And so I piled money into it and it ended up being a zero. We had an offer to sell the company for three hundred and fifty million dollars. Founder …”
Founders will need four times more VC meetings to raise capital
“It might take four times more VC meetings to get one check than it did only three months ago, but prepare for probably the hardest economic environment of any of our lifetimes, not just yours if you're a younger founder, but of anyone alive today.”
Mature startups facing cash crises will be hardest to refinance
“So when we're looking at companies, we're looking at bright-eyed, bushy-tailed, we're going to build this for the next 10 years, we're in the first six to 18 months of our journey, as opposed to a company been around for six years and suddenly finds itself in …”
VC fundraising will be harder from 2020 to 2025
“I suspect it's going to be harder to raise funds for the next five years than it was for the last five.”
Pay-to-play provisions have returned to venture capital deal structures
“It doesn't come back. It is back. It's back. Pay to play is on the table.”
Suster predicts lead VC ownership targets will rise above 20%
“Yes. In fact, I think it'll go up from 20%, not down.”
Suster warns fashionable tech market creates excess capital and non-entrepreneurs
“I think we've returned to a moment where startups and Silicon Valley and tech have become fashionable, and everyone wants to do it, which means you're gonna have too many companies, too much money, and too many people who aren't truly entrepreneurs, kind of cl…”
Suster: Entrepreneurship does not pay off economically for most founders
“I think it's stressful, it's hard, it leads a lot of people to depression, and conflict, and stress, and for most people it doesn't even pay off economically. And so if you're going to dedicate yourself to it, you sure as hell better love the product concept o…”
Suster: Rejections come quickly in fundraising while commitments take months
“I used to tell people about fundraising, which is lemons ripen early. And what do I mean by that? So if you go ask 30 people for money, five or 10 of them are going to tell you no quickly because no's come quickly and the yes's take months.”
Suster: Venture fund managers should pitch the smallest viable fund target
“Put the smallest number on the front of your pitch deck that you're possibly raising.”
Mark Suster: All investors act like sheep and follow herd mentality
“All investors are sheep. End of story. Like, I don't want to pick on LPs, like LPs are no different than VCs. They're no different than retail investors.”
Upfront Ventures deployed nearly $50M into discounted secondaries in 2023
“So in 23, I started buying secondaries at discounts. We deployed almost fifty million dollars into secondaries in 23 at deep discounts at a time where other people were, like, scared about the market”
Suster: Generative AI seed deals carry a 44% valuation premium
“If you want to do generative AI in 20, 23, 24, you're paying 44% premium to do a generative AI deal.”
Suster: Series B generative AI deals command a 200% valuation premium
“At the B round, it's like 200% premium to an enterprise software company.”
Suster: Upfront seed-invested in Ring after Shark Tank passed
“We were the seed investor in Ring. Everybody on Shark Tank passed on it. We wrote a check.”
Suster: Combining hardware and software produces differentiated VC returns
“Hardware plus software is incredibly valuable. So the hardware actually provides you with a differentiated return if you also have a services business.”
Suster: Too many VCs lack real startup operating experience
“Too many investors that I had come across didn't have real startup operating experience. And I didn't feel like I always got the advice that I could have used at the time I could have used it.”
Sustained unemployment will cause widespread spending declines outside grocery and pharma
“If seventeen million people are out of work for six months or more, Spending is going to go down everywhere across almost every category, maybe other than grocery and pharma.”
Ad spend saw a 40% quarter-over-quarter drop in Q2 2020
“40% decline right now in quarter over quarter for second quarter. And we're already seeing it in the data of people starting to cancel marketing orders that we know are being canceled.”
Upfront Ventures is closing deals entirely remotely without meeting founders
“We funded a company today. We submitted the term sheet two weeks ago, and I've never met the founder in person. We greenlit another term sheet last Monday. It'll fund early to middle of next week. I've never met the founder in person. We are going to our partn…”
VCs without follow-on reserves risk being wiped out to zero
“And don't forget that in that eighty million dollar round that gets cut back to a forty million dollar, if you don't participate, sometimes you get flushed down to zero. And so if you don't have reserves and you're playing in a game where big checks are being …”
Suster passed on Uber and Box due to personal biases
“The obvious example, Harry, is Uber, where having lived in London and seen the taxi lobby and how strong the taxi lobby was in London, that clouded my vision for what was possible. Having lived in Los Angeles and seeing how few people ever use taxis, that clou…”
Suster: Prospective Entrepreneurs Should Start Their Startup Journeys Earlier
“Entrepreneurship's not cut out for everybody, but if you want to give it a try, it's infinitely better to start earlier.”
Suster: Every Tech Leader Needs a Fundamental Understanding of Programming
“You need to take some programming course, even if you want to be the CEO or the head of sales or the head of marketing or the head of biz dev, Understanding, having a fundamental understanding of how systems work is critical to being in the business.”
Suster: Telesales and Direct Sales Experience Are Essential for Tech Careers
“Is to get some sales experience, and usually the best way to do that is telesales, and even if you want to be in marketing, even if you are in customer support, even if you want to do biz dev, ask the CEO if you can, you know, just do an hour a week of sales c…”
Suster: Prior founder experience gives VCs a key coaching advantage
“I feel like you're at a great advantage if you've been an entrepreneur, because so much about being a good coach, being a good mentor, is really understanding the journey that the entrepreneur is going through psychologically, physically, emotionally, and what…”
Suster: Excess capital breeds startup laziness while constraints force creativity
“A certain amount of constraint actually forces creativity, and when you have a little too much capital, you can take shortcuts, or you can throw money at problems, and it masks certain problems as well. So I'll just give you an example for anyone who's ever wo…”
Suster: VCs should evaluate founders over time using 'lines, not dots'
“But probably the best known post I've ever done was a post I wrote saying I invest in lines, not dots. And the metaphor is an x-axis is time, and a y-axis is your performance. And on any given day, I'm judging your performance on that day. How well did you pre…”
Suster: VCs who chase hot market trends late will lose
“Investors are like lemmings, and when an idea works, everyone chases the same idea. By definition, if you're chasing a hot idea, and you weren't early in that market, you're gonna lose.”
Mark Suster: Upfront's 2012 fund will return over 5x cash-on-cash
“That 2012 fund for us, I think is going to be a phenomenal success. By any measure, it'll, it should return north of five X capital cash on cash.”
Suster: Doubling fund size to $100M doesn't change core strategy
“50 to 500 fundamentally changes your strategy. 50 to a hundred, you're still playing in the same ballpark.”
Suster: Institutional LPs re-commit to future funds far more than friends and family
“Institutional money is way more likely to be in fund two and fund three and fund four. Whereas friends and family money's not as likely to repeat.”
Software revenue multiples hit 24.6x in late 2021 versus 9.6x average
“Public stock markets in November of 2021 software was trading at 24.6 times NTM next 12 month revenue, 24.6. If you look at the ten-year average, the ten-year average public market, 9.6. The twenty-year average, 6.2.”
Mark Suster limits secondary sales to 40% maximum during market run-ups
“Usually, in a run-up, I'll usually sell 33 to 40% maximum.”