Sep 13, 2024 · 1h 19m · my-first-million
10 Startups w/ Stock Grants That’ll Make You A Millionaire | Sara’s List 2024
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of My First Million, hosts Shaan Puri and Sam Parr unveil the 2024 edition of 'Sara's List,' ranking ten high-growth private tech startups where joining as an employee offers significant stock option appreciation and wealth-building potential. They evaluate market opportunities, business fundamentals, and leadership across AI, enterprise software, fintech, and defense tech.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. The hosts hold 100% of the talking time here. How this is scored →
The hosts as informed peer 6.2 Guest teaching 1.1 Guest disagreement 1.7 The hosts pushing back 2.4
speaking balance: gold is the hosts, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 24:35 Clash over Cursor's category
Sam repeatedly insists Cursor is fundamentally in the same category as small business website builders like Squarespace, prompting immediate pushback from Shaan.
Hardest push from the hosts ▶ 24:35 Shaan rejects website builder framingShaan firmly rejects Sam's framing of Cursor as a website builder, clarifying that it is an AI coding environment and IDE.
Biggest teaching moment ▶ 39:15 Shaan breaks down the Cyberstarts CISO modelShaan educates Sam on the underlying mechanism behind Wiz's record-breaking ARR, revealing how Gili Raanan's fund incentivizes enterprise CISOs with fund carry.
The host holds their own ▶ 54:20 Shaan calls out Sam's work culture hypocrisyShaan sharply highlights Sam's contradictory logic after Sam rejected Neuralink for poor work-life balance but selected Traba specifically for its hardcore 996 culture.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The hosts as informed peer | Guest teaching | Guest disagreement | The hosts pushing back | Why |
|---|---|---|---|---|---|---|
| The Origins and Philosophy of Sara's List | 6 | 0 | 1 | 1 | Shaan breaks down the financial philosophy behind Sara's List, contrasting early-stage high-risk startup bets with joining de-risked growth companies. Sam chimes in with personal context about Airbnb's scale when his wife joined. | |
| Grading the 2021 Picks and Tech Market Realities | 7 | 2 | 2 | 3 | Shaan analyzes the macro downturn and grades their 2021 cohort with data on down rounds and underwater options. Sam briefly pushes back on Shaan misattributing a company named Next Health. | |
| Sponsor Spotlight: HubSpot's Solopreneurship Toolkit | 3 | 0 | 0 | 0 | Shaan gives a brief sponsor spot for HubSpot's solopreneur toolkit before pivoting to open the picks with OpenAI. | |
| Pick 2: Retool and Internal Tools | 7 | 1 | 1 | 1 | Sam introduces Retool and its revenue trajectory, while Shaan details its core utility for back-end admin tools from personal user experience and shares his meeting with founder David Hsu. | |
| Pick 3: Mercury and Modern Startup Banking | 7 | 2 | 3 | 4 | Shaan pitches Mercury's strong position post-SVB collapse, while Sam counters with a bear case about preferring too-big-to-fail banks like Chase. Shaan defends Mercury's FDIC coverage and current customer traction. | |
| Pick 4: Cursor and AI Assisted Coding | 6 | 1 | 4 | 5 | Sam presents Cursor as a website builder comparable to Squarespace, drawing sharp pushback from Shaan who corrects the categorization to an AI-assisted IDE competing with GitHub Copilot. | |
| Pick 5: Epirus and Defense Tech Procurement | 6 | 1 | 1 | 2 | Shaan discusses Epirus and high-tech defense contracting, explaining how startups win government RFPs through live product bake-offs and strategic door-opener hiring. | |
| Pick 6: Wiz and the Cyberstarts CISO Network | 8 | 4 | 1 | 2 | Sam highlights cybersecurity unicorn Wiz's explosive ARR growth, prompting Shaan to explain the mechanics of Gili Raanan's Cyberstarts CISO partner network that supercharges early revenues. | |
| Pick 7: Neuralink and Brain Computer Interfaces | 5 | 1 | 3 | 4 | Shaan nominates Neuralink following successful human brain-computer interface trials. Sam challenges the pick on the grounds that working at an Elon Musk company contradicts the work-life balance premise of Sara's List. | |
| Pick 8: Perplexity AI and Search Innovation | 6 | 0 | 1 | 2 | Sam brings Perplexity AI and explains the founder's background, while Shaan differentiates its search accuracy from ChatGPT and evaluates potential big tech acquisition dynamics. | |
| Pick 9: Traba and Extreme Startup Culture | 6 | 1 | 3 | 4 | Sam introduces Traba and its intense 996 work culture. Shaan calls out Sam's inconsistency for rejecting Neuralink over long hours while endorsing Traba, questioning whether it is a true tech firm or a staffing agency. | |
| Pick 10: Replit and Cloud Development | 8 | 1 | 1 | 2 | Shaan delivers an exhaustive bull case on Replit, tracing founder Amjad Masad's journey from Jordan, early architectural bets on Python and in-browser execution, and comparing its metrics against GitHub and JetBrains. | |
| Mission-Driven Leadership and Episode Conclusion | 6 | 0 | 1 | 1 | The co-hosts reflect on why betting on visionary, mission-driven founders like Brian Chesky and Vitalik Buterin yields disproportionate career and investment outcomes, closing out the episode. |
Statements from this episode (33)
Puri: Tech workers should treat job choices like VC investment decisions
“Most people don't think of their job as an investment decision, but your time, your talent, where you're going to spend four years working is a investment decision. You should be thinking about it like a venture capitalist, and especially if you're working in …”
Puri: Sesame Street and 7-Eleven launched VC funds during 2021 peak
“Sesame Street and Seven 11 launched VC funds during this time, and so they had their own venture funds.”
Puri: About 36% of startups fundraising since 2021 faced down rounds
“So since then, about 36% of startups who have raised money since then Had raised at a lower valuation.”
Puri: Late-stage Series C and D startups are down 30% to 60%
“Later stage startups, which are the ones we're talking about series C series D they're down between 30 and 60% on average.”
Puri: Two-thirds of late-stage startup employee stock options are underwater
“Two thirds of employees right now that are working at these companies are working for options that are actually worth zero, and they probably don't even realize it yet, meaning they got a pay package of stock options at a 24 dollar strike price. That stock is …”
Puri: OpenAI is valued at $103B and generating $3.5B annual revenue
“OpenAI currently valued at one hundred and three billion. It's doing about three and a half billion a year in revenue already.”
Puri: OpenAI is Google's first credible competitor in 20 years
“It's the first credible Google competitor in about 20 years. It is something that actually could displace, replace search”
Puri: OpenAI hit 100M users in 3 months and $3B revenue in 3 years
“So it took him, you know, two or three months to reach a hundred million users. It's five times faster growing than the next fastest product ever. It reached three billion in revenue in the last, you know, in like three years”
Parr: 50% to 60% of all software is internal-facing tools
“50 or 60%, like, 50, between 50 and 60% of all software in the world is internal-facing tools.”
Parr: Retool hit ~$100M ARR in 2024 at a $3.7B valuation
“Their latest valuation is 3.7. They've raised one hundred fifty million dollars from Sequoia and a bunch of other great companies. Listen to this growth. First nine months, 500,000 dollars in revenue. In 2018, they hit two million in ARR. In 2024, they hit aro…”
Parr: Retool has 5x to 10x upside from $3.7B valuation
“So at a valuation of 3.7 I think there's room to run. I think there's a five or 10 X potential here.”
Puri: The best investment ideas come from essential tools on your P&L
“The first lesson I always remind myself is the best place to invest is in your P&L, meaning look at your expenses and go figure out which of those companies you think other people, you wouldn't want to cancel and other people are going to have as their expense…”
Puri: Retool reaching a $15B valuation (4-5x) will be tough
“Valuation is high, so I think four or five X is tough from there, right? To become a fifteen billion dollar company is tough, but I think it's a good, really good company.”
Puri: Mercury's current valuation is around $1.6 billion
“So the valuation is still in that sweet spot range where it's I think it's 1.6 billion right now.”
Puri: Mercury can fill SVB's shoes as a $30B+ company
“Nobody has really replaced them. I think Mercury is the best position to replace them. So if you think about like, what's the shoes they could fill the SVB Shoes as a 30 plus billion dollar company.”
Sam Parr: Cursor's latest valuation is $400 million
“Their latest valuation is four hundred million dollars.”
Sam Parr: Cursor is at a $10 million run rate or revenue
“They're at a ten million dollar run rate, I believe, or I don't know if it was run rate or that's actually what they did in revenue, but yeah, it's tiny compared to the valuation.”
Parr: Wiz reached $100M ARR in 18 months, fastest ever
“It's the fastest company ever to get to a hundred million in annual revenue. Took them at 18 months.”
Parr: Roughly 80% of Fortune 100 companies use Wiz
“Something like 80% of the Fortune 100 companies are already using the tool.”
Puri: Cyberstarts promises startups $2M revenue through loyal CISO network
“He promises teams of fresh graduates, graduates from tech units, not only investment support in the startup, but initial revenues of two million a year. This is usually their first year of revenue, which is intended to boost them above their competitors and he…”
Puri: Neuralink is valued at $5B with almost no revenue
“So, Neuralink is currently valued at five billion dollars. It's got, like, pretty much no revenue.”
Puri: Direct brain-computer interfaces are inevitable after smart glasses
“To me, this is a question of when, not if, meaning the next platform shift is probably glasses, but the one after that, or the, you know, the big one is just put the computer in the brain. That will happen.”
Sam Parr: Perplexity is valued at $3B and raised $415M
“So perplexity, I think their latest valuation was three billion dollars. They raised four hundred and fifteen million bucks.”
Parr: Traba explicitly promotes a 996 work culture
“And they basically, I think they explicitly said this on their website. We have a nine, nine, six culture, which means working nine AM to nine PM, six days a week.”
Shaan Puri is more bullish on Replit than any other tech company
“I think I am more bullish on replet than any tech company right now.”
Puri: GitHub reached a $2 billion run rate after $7.5B acquisition
“GitHub sold back in 2018 for seven and a half billion dollars. And at the time they were doing about 250 to three hundred million in revenue. GitHub now does about two is about a two billion dollar run rate.”
Puri: GitHub Copilot drives 40% of GitHub revenue growth profitably
“Fastest growing feature, the thing that makes up 40% of the growth of GitHub's revenue growth is co-pilot is the AI assisted coder that now does, you know, a few hundred million a year in revenue already after, you know, just a couple of years profitably.”
Shaan Puri discloses investing in Replit at roughly a $900M valuation
“What valuation did you invest in?
[4092] Shaan Puri: I think like nine hundred million.”
JetBrains generates $270M in revenue and $134M in annual cash flow
“JetBrains, which is another one of these, like the, probably the most popular coding environment for like Java developers. It's a bootstrapped company that does two hundred and seventy million in revenue, hundred million in profit, hundred thirty four million …”
Puri: It would take a $50B valuation to buy his Replit stock
“You couldn't buy my stock. You'd have to pay like a fifty billion dollar valuation to take my stock right now. Like I would rather just hold the stock and see where it goes.”
Replit is in-office and relocated headquarters to Foster City
“They're not remote, and not only that, they moved from SF to Foster City to, like, build their own cult there”
Puri: Amjad Masad predicted and built Replit's AI coding assistant from a decade-old seed deck
“In his master plan from 10 years ago in the seed deck was talking about how he's going to have an AI assistant in your coding terminal that's going to help you write the code.
and did exactly what he wrote, you know, 10 plus years ago.”