Floodgate

“The thing that matters, you know, in his view, and I would tend to agree is not how fast you get to a million, but how fast you can get to 10. Like that one to 10 is really the thing that'll set you on this kind of different trajectory.”

“A great startup Forces a choice and not a comparison, right? Like a great startup. If a customer says after seeing your startup idea, how does that compare to X? You either explained it wrong or you don't have a big enough idea by definition.”

“And so the best startup ideas tend to be the polarizing ideas, you know, ideas that probably most people don't like because they're not ready to live in the future, but a tiny subset of people say, oh my gosh, where have you been all my life? I can't unsee thi…”

“We raised a pre-seed from Peter Thiel, and Floodgate, and then our seed from Mike Volpe at Index”

“We were better, we're better at a hundred fifty million than we were at 75.”

“When you're on 22 boards, it's blowing up all the time. There's always something totally screwed up. You're not as awake to the possibility of what Pinterest could be when you get pitched by Pinterest, right?”

“We had a dedicated partner, Iris Choi, do follow-ons and that's all, and she's accountable for follow-on returns, which more, more seed funds should do.”

“We settled on 70% up front, 30% in reserves.”

“Probably about as low as I would go as half a million bucks.”

“Ann funded Lyft at five and a half million post money.”

“Similarly, in 20, 21, I only made one investment the whole year this company Hadrian. And why is that? Well, I just didn't find any companies that met my criteria.”

“Applied was expensive. It was 40 post.”

“No. Actually the reverse is true, but I don't know if that would still be the case.”

“I've never made money or lost money based on common or preferred ever in the ones that worked”

“Twitter was a little over 300 X and gets all the credit for Lyft, that was like about two, 205 X what else? Applied. Applied is probably encroaching on a hundred X in the first check. Twitch got close, but not quite there. It got to 94 X.”

“Our biggest failures have been failures of imagination. You know, it's like when I passed on Airbnb, or you know, what, what's another one we passed on, we would have done really well. Data dog.”

“The original hypothesis, if I had to say it in a pithy way, would be that 500,000 is the new five million.”

“80 to 85% of our exit profits had come from pivots.”

“So startups never win by being better. Better isn't enough. Better doesn't matter. Only by being radically different can a startup make a radical difference.”

“The inflection is the thing that allows the startup founder to wage asymmetric warfare on the present. The inflection provides the force multiplier that allows the startup to show up out of left field and not compete by being better, but by changing the subjec…”

“A great startup founder needs to say, it's by definition bad for me to compete that way. What I need to do is assume that the future must be radically different and work backwards from those radically different futures. I back cast rather than forecast. And th…”

“People tend to operate according to the current patterns of how they're used to doing things, and that the way that an entrepreneur wins is they impose a new pattern in place of the old pattern, rather than being a pattern match or their pattern break.”

“What I've come to realize is I'm not interested in the total available market. I'm interested in the total future market. I want the product to define future market and be the category king of that future market.”

“The way I like to say it is you need at least a Delta IV experience, and so if taxis in San Francisco were three out of 10 good, ride sharing needed to be at least seven out of 10 good. Because if it's seven out of 10 good, then they think you can't compare th…”

“And so to me, a great startup is pursuing a highly risky, but underpriced future that has wildly asymmetric upside.”

“I'm really enthusiastic about it, but we've only made two or three investments in the blockchain arena.”

“People who think all the time about a domain and are intensely curious about it for its own sake and pursue understanding it beyond what seems even reasonable Tend to attract luck. They tend to be visited by the muse before it visits other people, and especial…”

“What I found was that people who find these secrets, they almost feel guilty about it. They weren't being contrarian in the traditional sense. Contrarian means you're against something. They were just looking in an area they were interested in, an area where m…”

“But if you're a hundred and fifty million dollar fund, you don't have to be in all 20 of the top 20 startups. In fact, if you're in one of the top 20 every couple of years, you could be really good.”

“And I'd noticed that 80% of my exit profits had come from pivots.”

“So we at floodgate, we have this database of startups. Where you would have made more than a hundred X on your first check. And what we do is we create a time capsule.”

“So inflections might be harder to detect than authenticity of the founder to the future that they're pursuing. I tend to believe that for the most part.”

“About 10 years ago, Twitch was acquired by Amazon for nine hundred and seventy million. And we made something like 85 times our money. And normally you'd think that's a really good thing. It was a good thing, but I had forgotten that I was even a shareholder a…”

“So then I looked at, I'd been investing for about 10 years. And I noticed that like 80% of my exit profits had come from pivot.”

“I mean, if there's one piece of goodness about us passing on air bed and breakfast design, Ann and I were like, man, you know, nobody's gonna want to stay in a stranger's house. That's crazy.”

“Early customers are not animated by pragmatism. They're animated by belief. Early, early customers, early employees, early investors Don't decide to go into business with you because of the practical reasons that you unlock. They do it for aesthetic reasons. T…”

“The great movements do appeal to a higher purpose. They don't say I'm better. I'm better than company X. You know, I'm Avis. I try harder than her. They appeal to a more aesthetically higher purpose future. And then they show that this startup is the vehicle f…”

“When I was raising fund one for floodgate, I would go to an LP and say, We believe that there's a gap between angels and VCs and VCs are writing five million dollar checks, angels, 250,000 dollar check. We believe that 500,000 is the new five million because o…”

“I believe that the outliers usually start out at a low price, because they're outliers. Because they're non-consensus and right. People tend to believe that the world is divided between low price deals with low upside and high price deals with high upside. I d…”

“And so, you know, I think that part of why people want mulligans on their twenty-twenty-one funds is they were investing their funds in an eighteen-month cycle. And, you know, what they should have been doing is investing in a five-year cycle because the, ever…”

“As much as we loved Lyft and Okta, you know, in those years leading up into twenty-twenty, we're like, okay, we need to monetize these things, right, because there's a lot of excitement about tech stocks right now, and these prices are really high, and it does…”

“Yeah, for me, the job is sort of like, you know, when you're in the Galapagos Islands and you spot some, Finch with a weird looking beak that nobody's ever seen before. Like, I think that's kind of what Eric and I try to do, right? We're trying to, but like, i…”

“85% of the founders that we worked with, and I feel really lucky, we made good choices of who we decided to go into business with, but 85% of the founders were just like on it, and we were just like taking care of business, right, and not wasting time on the s…”

“Yeah, and I mean, like that's not the decision I would have made, right? I'm not gonna judge who made what decision, but my view is that it's not my money. And you know, if I was the Stanford Endowment, if I was you know, Sloan Kettering, what would I want Flo…”

“What we do at Floodgate is seventy-thirty”

“We have a partner dedicated just to follow on investing, and so the person that writes the first check Doesn't get to decide who writes the follow on check.”

“When you're on too many boards, sometimes you don't learn fast enough. You're not present and mentally awake enough, and you're not incorporating lessons quick enough.”

“And I asked him to be an advisor. And on the spot, he says yes. And he says, and I want to introduce you to my good friends that are investors, Ann Miraco at Floodgate, and Steve Anderson at Baseline Ventures.”

“Our best founders come through recommendations from our existing founders.”

“We made our investment in 2010, and the actual change didn't happen until 2012.”

“At the seed stage, we often say we're not investing in a company because a startup isn't a company. It's a set of insights. It's a development of a set of secrets that you have.”

“I only make Somewhere between three and six investments every year.”

“So we're in July. I've only made two investments at the seed stage.”

“The last two investments that I've done, I had a month-long process through which we got to know each other, and it was a commitment to one another”

“So when I invested, I think there were five of them in a one room office in Palo Alto, and now we're an organization of a few thousand people.”

“The thing that we were betting on was the Facebook Connect, to be honest. We thought that that was going to create more trust in this network, even within Zimride. Now, that was the thing that we thought was the real change element. It turns out that wasn't, r…”

“None of us had a boardroom. So I didn't have a boardroom. John and Logan were working in this one room office. I think Manu Kumar at Canine Ventures also, like, we're all just being scrappy at the moment. So we need a place where we can meet as a board to go o…”

“If you want to start a great startup, don't try to think of a startup. And the reason for that is that great startup founders are like time travelers, and they get out of the present, and they visualize different futures that are a breakthrough, that break fre…”

“Only with big inflections does an entrepreneur go from being disadvantaged to incumbents to having a fundamental advantage vis-a-vis incumbents.”

“And so in sector after sector of our economy, the companies that are software defined at their core, I believe software defined network centric companies at their core are going to keep winning. And they're going to keep displacing the companies that think of …”