May 18, 2018 · 30m · mad
Fireside Chat: Roger Ehrenberg, Managing Partner at IA Ventures (FirstMark's Data Driven)
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In this Data Driven NYC fireside chat hosted by Matt Turck, Roger Ehrenberg, Managing Partner at IA Ventures, shares insights on seed-stage venture capital, portfolio power laws, founder evaluation, and the evolution of data-driven investment strategies.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Matt holds 22.1% of the talking time here. How this is scored →
Matt as informed peer 4.1 Guest teaching 4.1 Guest disagreement 2.0 Matt pushing back 1.7
speaking balance: gold is Matt, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 25:40 Critique of YC Founder-Friendly Ethos
Roger aggressively challenges the industry consensus around 'founder friendliness', labeling passive governance and the Y Combinator mindset as harmful and 'really shitty' for entrepreneurs.
Hardest push from Matt ▶ 7:05 Questioning IA's Thesis ShiftMatt challenges Roger on whether abandoning the 'Big Data' firm branding was marketing repositioning or a sign that machine learning investments had disappointed expectations.
Biggest teaching moment ▶ 15:05 Explaining Power Law EconomicsRoger walks through the strict return math of seed venture capital, educating the audience on why successful multi-hundred-million-dollar exits still fail to meet portfolio return bars.
Matt holds his own ▶ 13:40 Identifying InfoSum Data SolutionMatt demonstrates impressive grasp of IA's portfolio by anticipating Roger's point on privacy-preserving queries and naming InfoSum and its core value proposition mid-explanation.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Matt as informed peer | Guest teaching | Guest disagreement | Matt pushing back | Why |
|---|---|---|---|---|---|---|
| Welcoming Roger Ehrenberg and Career Background | 4 | 3 | 1 | 0 | Matt welcomes Roger, referencing his Midas list recognition and early career on Wall Street before discussing early IA Ventures wins like The Trade Desk and Flatiron Health. Roger elaborates on the context of investing in ad tech during the 2009 financial crisis and his background as an angel investor. The dynamic is polite, reflective, and conversational without friction. | |
| IA Ventures Fund Structure and Thesis Evolution | 5 | 4 | 1 | 2 | Matt asks a sharp question probing whether IA Ventures moved away from its explicit 'Big Data' branding because the thesis underperformed or simply because it became an unnecessary label. Roger explains that while big data was a great early narrative, strict thesis guardrails became overly restrictive. The exchange demonstrates informed questioning from the host and thoughtful elaboration from the guest. | |
| Investing in Data Network Effects and Data Moats | 6 | 4 | 0 | 2 | Matt cites specific themes Roger has written about and names portfolio companies like Signified and InfoSum before Roger even introduces them. Roger details how data network effects allow companies to take on customer risk and solve sensitive privacy problems. Matt demonstrates strong background knowledge of IA's portfolio and architecture themes. | |
| Venture Capital Returns, Portfolio Strategy, and the Power Law | 4 | 5 | 2 | 2 | Matt asks why IA reduced focus on complex real-time analytics, prompting Roger to detail the strict power law math governing seed venture capital. Roger educates the audience on why non-billion-dollar outcomes, while good companies, do not fit IA's concentrated portfolio return target. The dynamic is educational with Roger breaking down VC mechanics. | |
| Evaluating Founder DNA: Experimentation and Action Bias | 5 | 5 | 0 | 3 | Matt quotes Roger's essays regarding founder DNA traits like experimentation and action bias, asking how VCs can practically test for these in early founder meetings. Roger explains the psychological hurdles brilliant founders face when making decisions without full data. The segment represents a peer-level deep dive into founder psychology. | |
| Rethinking 'Founder Friendliness' and Investor Governance | 5 | 5 | 6 | 3 | Matt brings up the trend of investor 'founder friendliness' and asks when it becomes an abdication of governance. Roger strongly rejects the popular VC sentiment, calling passive friendliness and the Y Combinator ethos 'shitty' for founders who need candid feedback. Roger takes a strong contrarian stance against prevailing tech industry norms. | |
| Audience Q&A: Direct-to-Consumer FinTech Viability | 0 | 3 | 4 | 0 | An audience member asks if direct-to-consumer fintech remains a viable investment area under power law dynamics. Roger gives a direct, skeptical response, stating they evaluated hundreds of deals without finding any that meet the firm's bar. The host merely moderates the Q&A floor. |
Statements from this episode (10)
IA Ventures held 19% ownership in The Trade Desk at its IPO
“We actually co-led the seed round with Founder Collective, and then we bridged the company three times, participated in the A, participated in the B, and by the time the company IPO'd in September of 16, we own 19% at IPO”
IA Ventures expanded beyond big data due to restrictive investment thesis
“Those guardrails were overly restrictive relative to where we felt we could really both source and invest intelligently and to achieve the returns that we were shooting for.”
Ehrenberg: 'Big data' label lost meaning as AI became ubiquitous
“But I think it's just now it's so ingrained in pretty much every single thing that you look at or I look at, it's kind of doesn't mean anything anymore.”
IA Ventures requires every prospective investment to have multi-billion-dollar potential
“Each of us make two to three investments in a given year. Every investment that we are making, we think has the potential to be a multi-billion dollar outcome. Every single one. That, that is the bar.”
IA Ventures targets 24 deals per fund to find two returners
“We found in our, kind of, the power law reality of venture that we would much rather take 24 gigantic swings in a portfolio over a four-year period and work Hopefully that two will be multiple fund returners and that the next six, so call it two super performe…”
Ehrenberg: IA Ventures invested in The Trade Desk at PowerPoint stage
“Sometimes we invest, you know, again, Trade Desk was a PowerPoint.”
Ehrenberg: Permissive 'founder friendly' VCs are actually doing founders a disservice
“Founder friendly has Become identified or associated with being permissive and being loose as it relates to documentation, as it relates to founder expectations, as it relates to founder egos. I think that is actually being very founder unfriendly”
Ehrenberg: Y Combinator's adversarial founder-investor ethos is 'really shitty'
“It's against, like, the YC ethos. Like, I don't think in many ways that that attitude of it, you know, founder, it's founders versus investors, keep investors at arm's length is really healthy. I actually think that's really shitty. And does founders agree to …”