The Ledger, every show

“I had a, an LP who joined in the third fund, and four months later, I tell him that you know, I'm raising our fine for, I finished, I'm raising, and he totally freaked out, and he started lecturing me on, he didn't call it what you called it, he called it vint…”

“So the bottom line is, I think this notion that all the incumbents are going to die, you know, this notion that is being promoted by some People who I think whose main motivation is to make provocative statements, you know and get attention as thought leaders …”

“By the way, from the LP perspective, diversification at the level of the GP makes no sense, because they have multiple GPs, so, so the diversification gives nothing to LPs.”

“I'm going to do my thing, and if it works for them, fine, and if not, they can opt themselves out, and some of them have, and it's fine. Good people opted out, and it's fine. I'm not going to do things differently.”

“If you are traditional five, six person partnership without anything Very, very, very unique and special in the friendship that you bring to the table, then yes, I think you are in trouble because it's almost like, you know, worse off. On one hand, you're not …”

“However, if you if you are a fund that is more middle of the road and you're not sure how Is it gonna be a raise or not? You're gonna find any excuse to keep the prices up, right? To look good on paper.”

“You know, if the typical, if a partner in a in a partnership, especially large partnership with some, with politics and all that they're much more interested in their investments succeeding than anything else because that's their career.”

“In general, I don't think one should be overly price sensitive. Obviously, you know, you have to have some discipline, but the reality is that if you're dealing with companies that are growing at over a hundred percent per year, and you believe it's sustainabl…”

“So that's another example where I think that You know, a partnership can drive things more towards mediocrity as opposed to exceptionalism.”

“I would say that on the LP side, I think they're way over-diversified because most of them have 20, 30, 40 relationships. That's crazy because each of their underlying investments or funds is also very diversified. It's not very likely to lose money. So each, …”

“When I quote unquote consult with people in a partnership model, I'm also in a persuasion mode or a sale mode because I need to get it approved. So I think just naturally, and I think everyone is like that, you're just less receptive. First of all, you're just…”

“I think diversification is way overrated. I think that VC funds are generally way over diversified”

“I pretty much do not keep reserves, or keep very, very little, and the reason is, because I do cross-fund, I don't feel that I need to keep reserves, because I can invest from the next fund, if I want to”

“Sometimes LPs ask me, how do you do diligence, and I tell them I don't, and I exaggerate a little bit, because sometimes I make a few phone calls, but I'm not exaggerating by much, and usually there is, like, silence. They've never heard it before, and then I …”

“The fact that you let them Take money off the table actually brings better alignment. Even a significant amount, even if it's five or ten million, they're much more likely to try to hit for the fences and not take the first couple of hundred million dollar acq…”

“In terms of diversification, if I learned anything, is that the diversification doesn't work, because when things turn south like that, then diversification is not going to save you, because everything goes down, and because everything is very correlated.”

“I think many, many partnerships are much more dysfunctional Then you would see from the outside, and there is a lot of, often, tensions between, you would think that partners need to be, you know, you would expect that partners are best friends, and really thi…”

“If I know better than them, that's a horrible sign. I should just, I, you know, I should write the investment off if I think I know better than the founder.”

“By the way, I pay myself zero. I don't see anything, which is very unusual. I don't know any VC in the world that has zero income. From the management fees.”

“Now, specifically with Navan, which a company I know well, I'm a hundred percent convinced that there's zero chance that we get disrupted by AI, and there is a hundred percent chance that we're huge beneficiaries of AI.”

“The more operationally complex a business is, the more it's about distribution. The more it's about integration with source and with other pieces of software or content in the case of Navan or part of the ecosystem, the more the more it's in a regulated, this …”

“Companies that on one hand are not, many companies are not easy to disrupt, and as long as they don't fall asleep on the wheel, and as long as they navigate, you know, they adapt they're going to be huge beneficiaries of AI.”

“One, you know, one of them is going to be successful, but there's a thousand or two, but there's a thousands that are not. So I'm not, at the very early stages, I don't trust my intuition enough to know which one of the thousand is going to be successful.”

“They were the first company to let people go. And they got so much shit on, ah, for it because they fired people Over Zoom, as if there was any other way they could have, and they still got a lot of shit from the press”

“Well, I think in general in twenty-twenty-one, pretty much every deal that I did, most actually I shouldn't because these are quality companies, but every single deal I probably paid. Three or four X, what I should have, because that was the market.”

“At least 50% of the funds today, and maybe more, either cannot raise, or at least are not sure that they can raise, or they're trying to stall and, you know, not test the market, and I think many of them are not gonna be able to raise.”

“If you're a fund that's, let's, let's say Sequoia, for example, they know that they can raise any time, right? So they have zero motivation to inflate numbers. They have all the motivation in the world to show things as conservatively as possible, right? Becau…”

“Are not good rail guards from that perspective, because even if they challenge valuations, they always challenge the wrong things, and they always, it's complete lack of understanding what, you know, because how, why would they know what, you know, what compan…”

“Look, especially in the larger funds the compensation that the V, that the GP gets from the management fee, especially if you account for time value of money is typically greater than the than the upside.”

“The very fact that after a year or two they don't have signs of product market fit, maybe it means that, you know, it should be worth less than what it was worth at the seed, because at the seed you had the option value of maybe within a year or two you will h…”

“My advice is take the money. But continue to behave as if you didn't. Don't spend money just because you have it. You know, companies can be overfunded, and, ah, it can lead to loss of focus, so if the founder's mature enough and strong enough to take the mone…”

“And that's exactly why I don't tell LPs anything in terms of what I'm going to do, because I feel that if I tell LPs something, I would feel too committed to that specific strategy, which I may have thought it was the right strategy, but then there's a situati…”

“I find that there is an increasing level of hating the successful, hating the rich. I see it on Twitter. I think in Europe it's even worse, but it's come to America, unfortunately.”

“Let's say that I'm not a fan of the movement or the work movement that is You know, dragging or trying to drag America in the other direction.”

“This is one thing that is, Consistent fallacy within VCs that they think that just because they saw a deal, they necessarily would have been able to do it. No, you know with all due to anti-portfolio, it doesn't make sense that the same deal appears in 20 diff…”

“Because in 2000, in 2021, I raised three funds total, total about a billion, and then now I'm raising another five hundred million.”

“And I don't keep reserves, so I, you know, invested, you know, invested at all.”

“If I raise a fund every year and they just are in every fund, they do get the you know, even if one fund is not what he called vintage diversified, they would be vintage diversified if they care about it. I don't care about it, but if they do, you know, they c…”

“If you decide to give up a month or two too late, the agony And the lack of dignity. And the pain is like 10 times, you know, when you decide to stop in time, you have enough time to do it in an organized fashion, to make sure that everyone is taken care of, t…”

“I had an opportunity when Uber Freight spun out of Uber. I had a very unique opportunity to get ownership and the ownership that I, to buy ownership from actually from the from Anthony Lindowski, the guy who allegedly or not allegedly actually, because it was …”

“So I think that's another idea that to me, it's never about protecting the ownership. You know, if I put my money in a company again, It doesn't matter if it's a full on or new. It's because I want to put new money, not because I put something in the past and …”

“I do think that the number of course, some absolute number, I think that the higher the Probability of success of the underlying, of each individual underlying investment is the less diversification you need. If you believe that every deal that you do has 50% …”

“Something must be wrong in an industry where they take, you know, weeks and sometimes more to make a decision that is like, they knew what the decision was before they started to do, you know, the work and the work has no value whatsoever. It's just that that'…”

“I think that I have a very, very special rule, which is almost always true, which is the ones that you want to sell, you can't, and the one that you can sell, you don't want to sell.”

“Today, I believe that Audible would probably be worth 50, a hundred billion.”

“The conclusion from these two instances, especially from the second one was that I never want to have partners again. Okay. So that was my takeaway that I don't want to have partners that I, you know, I want to own my own mistakes and own, I don't want to suff…”

“And this is a teachable moment for me because next time, if the risk is that I only make two or three X, quickly, not after five years, then I should have done it. And I'll tell you why, because I totally forgot that I could recycle the money. So in the unfort…”

“That, you know, that it's all about being the best alternative for the founders. The founders are the customers, not the LPs. And the customer's always right. And we work for the founders.”