Can You Still Win in Venture Without a $1BN Fund? Menlo’s Venky Ganesan on the New Rules of VC

At this point in Menlo's history,right, we are going for broke. We are going for the Grand Slam home run. We want to see everything. We want to win everything. Full stop.

In this discussion with Venky, we discuss the craziness that's happening in venture: pricing, when to pay up, when not to, how to think about market sizing, how to think about when to sell, how to think about being collaborative in rounds.

This, and so much more, in a true nerd venture fest that is this episode.

It is a very disorienting, confusing time. Each seed investment is an option bet. You're buying an option to see if it's an outlier. If there's an opportunity to make money on an investment, we should do it. The rest of this, it's all noise.

There is no way for venture to be successful in today's era without the mag seven participating in everything you're doing. There's no limit to what a person can do, as long as you don't care who gets the credit.

Ready to go?

Venky, dude, I am so excited to do this. I am such a fan of your tweets. Who would ever call them blowhard? Right? That's the terrible commentary on it. And I was so looking forward to this. So thank you so much for doing it in person.

Oh, I love this. Thank you so much. And I cannot wait to see if I pass your test.

Dude, you'll pass my test. Now, I want to use this as a real learning discussion for me, because I want to build a firm like Menlo, and I want to learn from the wisdom that you've had now, seeing multiple different cycles.

You just told me a story that I loved, and it was from, you know, two decades ago, holding a certain stock. Can you tell me that story and your takeaway?

Yeah. So a little bit of a past. Previously, I was at a firm called Globe Span Capital Partners, and we happened to be investors in a company called AvenX, which is nobody knows about this company, AVNX. I remember the stock symbol even now, because I was an associate, did not have carry the fund.

AvenX was a big winner. Goes public. They gave the associates a chance to own shares at IPO. So I bought some shares at IPO. I remember putting the princely sum of $5,000. And at one point, AvenX got up to $200,000.

It was such a big portion of my portfolio. And my wife, who is much smarter than me, she was my fiancée then, we were getting married, she said, "Hey, why don't you sell some so that we can have something for a down payment for the house?"

And I was like, "No, no, no. AvenX is going to go up. Optical components is a critical part of the internet bubble. It's going to go. We're going to make a million dollars on it." And you know how the story ends,right?

It drops 90%, and I think I sell it for around $8,000 to $9,000. So I call it the most important lesson I learned from a 90% loss, which is, at some point, you should take some chips off the table.

I'm not sure what to take from that, because I know I remember having Jake Saper on from Emergence, and when he broke down Emergence's returns, basically you just saw this one meteoric outlier that returned 90 to 90.

Viva?

Well, Viva, yes, but it was actually Salesforce.

Wow.

And if they had keld it longer and longer, obviously it would have been even more meteoric. And so I guess my question is, what should we take from that? Because we also see the dangers of selling too early.

Agreed. I think a lot of it, a lot of this advice depends on the context of who you are as a person and what your balance sheet is. At this point in Menlo's history,right, we are going for broke.

We are going for the Grand Slam home run, because we have had home runs before. We have a history of putting it on the table. As a 24-year-old with very little in your bank account, when you have that kind of, for me, AvenX game-changing money, it just makes economic sense to take some off the table.

And so I do think, like, the advice is there's no one-size-fits-all for these things.

Did you say you're going for broke? I love that. Like, all hands to the pump, we are going for this. Does anything change with that mindset internally? Like, is it more aggression? Is it more willingness to pay up?

Is it more willingness to have less ownership? What changes with that?

We mean as we are going to fight and try to be in the defining AI companies of our era. We want to see everything. We want to win everything.

Full stop. So I want to start with a concern, which is, I don't know what business we're in anymore. Venture is not venture anymore. I had my team come to me and say, "Hey, we can't find anything under $100 million."

And I said, "Wow, that's a lot of, that's a high price for a pre-seed or a seed round." And they said, "No, no, no, Harry. That's the size of the round." Venky, this is not venture. What am I to do in this world?

And can you invest without a billion-dollar fund?

Venture has changed. But I also think that you can't take a snapshot in time and draw, you know, a dot is not a line. Andright now, you'reright. Every AI company wants to raise, you know, hundreds of millions of dollars.

And I'm surprised they only said $100 million, because there are some ones, there are some neolabs who want to raise billions of dollars,right? And they all have arguments for it. And it is a very disorienting, confusing time. I will admit that.

But I also think, like, these things change quickly. So you don't want to necessarily draw your long-term strategy with a snapshot in time.

These things change quickly. So do you play the game on the field, as Bill Gurley says, or do you call time out and say, "You know what? I learned from 2021. You know what I wish I'd done in 2021?

Bless."

This is a really hard conundrum for professional investors. You know, you're referring to my tweets,right? The Czech Prince code is, "When the music is playing, you got to dance." And as a professional investor, the danger of not dancing is that you do not know when this ends.

Like, I'll give you a story. Like, there were a bunch of really smart venture firms doing the dot-com boom that got in in '93, '94, made money, and decided to step out of the game in '96, '97. And when they stepped out of the game, they missed out on '97, '98, '99, and their LPs were like, "What happened?"

Like, we asked you, we invested in you because you're going to be at the cutting edge. You stepped out. And they stepped back in 2000 on the peak,right? So timing markets is really, really hard. So I think you have to play the game.

But I think you can play the game differently. You can choose to be more selective, and you can hopefully think about portfolio composition and position sizing as a way of mitigating what happens when the cycle turns.

Portfolio composition and position sizing. What do we do with both of those in a market then like this? How do we change them?

I think you have to think about the venture portfolio as a bunch of options,right? Each seed investment is an option bet. You're buying an option to see if it's an outlier. And so you want to have enough of those so you can make sure you have an outlier.

And then when there are true quantitative evidence based on revenue and quantifiable metrics that there's going to be an outlier, then you position size up. So to me, like, you have to think about, "Okay, what is my fund size?

How do I have enough at-bats," to use a baseball analogy or a cricket guy, "and make sure that you have enough at-bats, and then you only position size up on the things that are already proven?"

Totally get that. Do you think seed still really exists today?

If you want to go into the core AI world with the neolabs, I think seed is hard.

But even in AI application-like companies, they're raising 10 to 20,right? The old three to five days, which was still quite large seeds, and that's gone.

Honestly, I think two things that impact seed investing today is, one, it's the size of the round. And then you have this other sort of externality, which is these large funds, maybe including us, somewhat being indifferent to seed valuations, because they're using that as an option check to size up.

Because you are, aren't you? I don't mean that to put you on the spot, but.

Yes. I mean, we are trying to buy ourselves a seat at the table. And the cost of buying that seat at the table, we are somewhat indifferent to at the seed stage, because our real goal is to size up and invest in them if they become outliers.

Totally get that. Thank you for making my life harder in that respect. But I agree.

You should just invest in our funds.

And then it'll be fine. That's very funny. Nicely transitioned there. I give you credit for that one. You said, like, so you place these bets, so to speak. Completely agree. And then when you see discernible traction or revenue numbers, usage, whatever that is, then you can double down.

Completely agree with that logic. We're seeing strange numbers, like, you know, contracted annual revenue that's not actually annual revenue, and it's kind of not live. You're seeing revenue run rate that's kind of extrapolated out from the best day in history, and then we times that by 365 days.

There's a murkiness to this revenue that we've never seen before that makes me feel quiteicky in a lot of cases. Do you share that? And how would you advise me, and what do internal discussions look like around that?

If any metric is measured by an investor and they put a lot of weight on it, it's going to be gamed. And that's just in nature. Maybe they should coin a law for it. And there are two elements that are going on.

One, I'm blanking, I don't know if it's Keynes or another famous economist who's coined the term "bezel." When there's a boom, the bezel is high, which means, like, it's a notion that the embezzlement of things will be. So not just people are going to pick metrics, people are also going to have some interesting accounting techniques, which, by the way, will happen every cycle.

And it's probably happening at this cycle. So we're going to find out in the next few years exactly the accounting creativity of some of our founders and the metrics being gamed by some other people,right? One good example of it in doing the SaaS way was a lot of investors put a lot of weight on net revenue retention.

And so one of the ways to game net revenue retention is that you could get a $100 PO, but better, get a $10 PO and get a $50 PO a week later, because your net revenue retention, if you just got a $100 PO, was, you know, 100%.

But if you got the $10 PO and the $50 PO, it's now, you know, 500%. And the net revenue retention looks much better. So once a metric is measured, it can be gamed. And that happens. And so to me, a lot of this comes down to, are the founders really focused on building a business?

Are they focused on terminal value? Are they focused on markups? And I think you want to find founders and investors who are focused on terminal value.

Do you believe in king making? I know that sounds like a strange question. King making the theory that multiple successive and quick rounds led by strong investors can really help increase the chances of a company being successful.

See, to me, that is a great example of Soros' reflexivity,right? What I mean by that is, you have a company that does well,right? And because it does well and the revenue is growing really fast, it has a quick markup.

And because of that quick markup, it gets more capital. It gets to come on Harry's show, and then it gets more notoriety. That allows it to get more human capital and along to the financial capital. It grows faster.

And there's another markup,right? Now, these are good things as long as the revenue is happening and the core business is building. But someone, a copycat can look at that and say, "Oh, the secret is to have a markup."

And a copycat investor might look at it and say, "If it's marked up, it's going to be marked up again." And then reflexivity kicks in. And then everybody starts acting that way. And this explains how market cycles work until it stops.

And one thing we know from Soros is that all reflexivity will eventually stop. We just don't know how and when. But until it stops, a lot of people can look very smart playing it.

We don't know how and when, but we can play the game of predicting how and when. If you were to predict how, what is the first signs of this cracking?

I think usually the first sign comes with some major debt default. And generally, equity is never the reason why these things crack, because equity, you write it down, you just take the loss. Debt, on the other hand, people have this expectation they're going to get paid back.

And so most of the cycles I know, it breaks because people lever themselves. And so if you see what happened with Leopold, incredible investor,right,right? But when you're 4x leverage, it doesn't matter if you'reright. You have to also get the timing correct.

Mr.'s Risk Management class at high school, didn't he? Poor old Leopold. When the music's going. So yes, I completely get you there. How do you feel about, like, the multiple tranche rounds so quickly? I'm meeting founders very often where they're like, "Oh, we're doing a round this week at 100, but then we'll be opening up the second turn of it later next week at 200, because we've got so much demand."

This just gives me shivers. And I feel like I'm kind of, "We buy any gold," or "We buy any car."

I feel like in every cycle, you get the innovators, then you get the imitators, and then you eventually get the idiots. And I think the innovation of the tranche financing was the notion that I can get build-with-me money, where these investors are going to come build with me, and then use that build-with-me money at a lower valuation to get just money at higher valuation, and then eventually transition to just pure dumb money.

And I think that's the logic of this,right? And so I don't need, like, money, all money is not the same. I will bring in some investors who are going to actually build the company with me, and then I will also bring in some capital along, and then eventually I'll bring in some very low cost of capital.

And I think that was the intention. But again, like everything else, now people, everyone's doing it. And it's not tied to the quality of the company anymore. It's just, it's become another technique for people to do. So I find, like, these things start initially with some, the core of the idea is actually a good one.

Okay, I want to actually raise capital, but I want to distinguish between capital that adds value and capital that doesn't add value.

Will you do it as a firm if you'll come in in the latter tranche?

Absolutely. It depends on the situation. We have been on both sides of this situation. And I think if the company is interesting, the founders are special, absolutely.

Really?

Yeah. I mean, at the end of the day, I never care about what other people invest, what they do. I'm looking at this round and say.

Are you not hurt by the fact that they are saying you're legitimately less valuable than Peter Fenton, who we're letting in at half the price?

Peter is amazing. I think the biggest thing I've learned over time is you never want to let your ego come in the way. My only ego is to make money for my investors. So if I can make money for my investors, who the hell cares?

Have you let your ego ever get in the way? I have done.

100%.

What happened?

I think you get caught in ways of around negotiating for valuation or being in a syndicate, or sometimes you're offered the opportunity where you think you're offered a small piece, and you're like, "Well, I'm too big for that piece."

I think in this business, you have to have a high degree of humility, because every week I get hit, I get punched in my face by things I don't know. And I think the biggest mistakes are when we get too caught in our ego.

Look, the reality is simple. We raise money for institutional investors with one and only goal, which is to return more of them back. If there's an opportunity to make money on investment, we should do it. The rest of this is all noise.

And I think too often, because venture capital tends to be dominated by personalities, people get caught in these. You probably don't know a lot of people at Goldman,right? Everybody can say David Solman, who's a CEO. But the idea is Goldman makes a ton of money, and those people just go do their job.

And I think too often, venture capital, we end up, because there's so many personalities and people, it becomes more about who and our ego as opposed to just do the job.

I think that's forced by the fact that we are fighting for constrained supply there. If you're looking at, say, Goldman's public team, you can buy Nvidia, I can buy Nvidia, they can buy Nvidia. It is a free market.

Here, we are both competing for Max at Legora. And our check, if he takes yours, he won't take mine, because there's one lead check. And so we have to have personality. We have to sell ourselves, because there is a constrained supply, no?

Yes. What you say is absolutely true. But just that you have to have these two dualities and manage them. One is you have to have a personality. You have to be able to project a sense of differentiation,right? Because why does someone choose Harry and not me?

It's because they like Harry.

A good looks and charm.

Clearly. I see that in person even more so. But I think if you get caught in that, and you get so immersed in it, then you lose the sense of what the core purpose is,right? The core purpose of having that personality and charm is to make money for your investors.

That's why it is,right? And if there's a time for you to make money for your investors where you have to let your ego take a backseat, you should do it. And that's theright thing to do. Now, I'm not saying it's easy to do.

I'm not saying I've done it, but it's theright thing to do. It's kind of like, I know I got to eatright and exercise. I know that. I don't do it often, but I know it's theright thing to do.

Yeah, but Jim Conn is so good.

Some things in life are worth it, like butter chicken.

I'm a dishum.

Oh, you are? Oh, well done. Well, don't worry. I like a dishum too. It's fine. We said about price kind of, hey, we're a little bit less focused on it when it's early. There comes a time when it does matter.

With the greatest of respects. Oh, say it. Say it. Money kind of pay up.

And for all your entrepreneurs out there, we definitely pay up. So definitely call us.

Yeah, you do. And every time I'm like, man, like paying up. And you prove meright. Like, you'reright. And I'm proved wrong when I'm like, god, they're not disciplined on price. And so I guess I'm questioning, like, do we just need to completely reshape how we think about terms and market sizing?

Let's think about when people pay up. People just sometimes pay up to be able to win the deal,right? But I think sometimes people pay up because they're able to see a bigger term than the other investor,right? And I think in those cases, you're not actually paying a higher market price.

You're able to see that the opportunity is bigger, and therefore you're willing to see that possibility. Now, sometimes you're going to beright. Sometimes you're going to be wrong. So to me, I don't necessarily think it's just price. Now, sometimes you don't see the term.

You're just trying to win the deal, and that's the price it takes. And you're just a clear price taker. And that happens too. The problem is venture is an asymmetric game. You can lose the dollars you invest, but you can make 10x if you'reright.

And that asymmetry means that the sense of omissions are way higher than the sense of commissions. What I mean by this is you only see the deals we do,right? You don't see the deals we pass. But the most expensive mistakes venture capitalists make are the deals they passed, not the deals they did.

When you say that, what's the most memorable pass that haunts you? What is it?

My most memorable pass was that I was a young board member at a company called Plackson, which had an incredible board: Mike Moritz, Ram Shri Ram, Tim Kugel from Yahoo, and little unknown me, and Sean Parker, and Todd Massanis, who was the founder, and Cameron Wren.

Sean had some challenges on that board and was asked to leave that board. And he was going, because I was the only person within 10 years of his age in that group, he was telling me he was going to Boston, and he was going to work with this college dropout.

And he's like, you should get involved. And I'm like, Sean, you just got vooted out of this board, and I have no idea what I'm doing. And I didn't even take that meeting. And, you know, I probably had the opportunity to write a $50,000 check.

And those seed rounds were different. They were million-dollar seed rounds.

That's a tough one.

Yeah.

What was Sean like back then?

The way he described Plackson, his vision actually worked out. He understood virality, network effects in a way, his thought process around what happened at Napster. You know, so my rule of thumb is I'm always looking for people who are incredibly good at communicating very complex concepts in a simple manner and just have insight.

And Sean just had insight around human behavior and complex concepts and could boil it down in a simple way. He was a very good communicator.

What a character.

He gets to have Justin Timberlake play him.

I mean, it's a pretty cool one. Drops are there. Love it. We actually did that. We were the 20-minute VC.

Oh, sorry.

Now it's just 20 VC. Yeah, yeah. Thanks, dude. I was talking to Amy beforehand, speaking of kind of founders you back there.

Amazing partner of mine.

Amazing partner of yours. And she said that you care a lot about understanding what brought founders together. And hearing about you talking about Sean there made me think of this. Why do you care about what brings founders together?

And are there any patterns or signals that excite you?

The company you build is a team you build,right? And so much of the DNA of a company is set by its founding team. And so what brought them together, why they thought in a world of 6 billion people, they should be the people to do this, how they think about each other's strengths and weaknesses.

I think these things all sort of like minority report, they're like a precog that tells you around how they're going to make decisions, how they're going to build the rest of their team. So I think it gives you a clue about who are these people.

And ultimately, I think the company's culture and DNA are going to be shaped by the founders.

You can ask one question that you find most revealing of a founder quality. Doug Leonie's to me was the one I remember most. And he always says, what's your worst reference?

So, you know, that's a great question. I generally ask your five best friends,right? And imagine they're in a room. And if I had to ask them three words to describe you, what would that be? That's a question I normally ask people,right?

I'll tell you, I listened to Mike Moritz on the interview, and he asked a question. And his favorite question is, if you could go back in your life and change one thing, what would that be? I think that's a pretty interesting question.

The reason why I like to ask how your friends describe you is I think you're more likely if I were to ask you, what do you think about yourself? It's harder. But when you think about your friends, you can sort of externalize it, and then that gives you a clue about how the people around you think about you.

And it also tells you your self-awareness. Because usually, after I do that, I also do references, and I'm trying to see if the references match someone's self-awareness,right? It's actually OK to have if you know your weaknesses, then you have a much better chance of managing them.

It's the people who are blind to their weaknesses that usually have challenges.

Do you mind? My weaknesses are revealed in the comments section of every interview, so I see them glaringly. You know, one thing that has been, I think, uniform across the industry is we've seen ownerships go down. Even the hailed benchmark now take less than 10%.

I thought they said 20% are bust.

Ah. Maybe let's stick to that message. I love the benchmark guys. So absolutely. But does ownership matter as much anymore?

Of course it does. Ownership always matters, but I think you have to think of that relative to the opportunity,right? What I mean by that is, yeah, would I love to have 20% of a company? Sure. But I'd rather take 2% of a trillion-dollar company than 20% of a $100 million company,right?

So you'll do deals now for 2%, 3%?

We did. Anthropic, we own less than 2%. My point is that I think when you think about ownership, you can't think of that in isolation.

But I think you're either in the ownership game or you're in the money movement game.

I disagree a little bit. I think when you're getting your option bet, you want to have ownership, because then it's not clear. So let's say you know it's an outlier. If it's an outlier company, then you are in the capital invested game.

Prior to it being an outlier company, you have to be in the ownership game. Your best situation is you're in the ownership game in an outlier company, and then you go into the money movement game. You know what I mean?

No, I thought the ownership doesn't matter prior to being an outlier, because you're there for the information. When it does become known, it becomes a money concentration game.

You want to have enough ownership, though. I mean, you look at Higgsfield. My partner Amy, she killed it. She got 15% of the company for a $5 million check. You had Alex on your podcast. Incredible entrepreneur, incredible business,right?

So in that case, we got the ownership, and then we also have the opportunity to then size up.

Did you?

Yeah, we invested.

Do you get my rationale, though, for actually it doesn't matter if you have ownership in the first place. What you're buying is the information to size up.

I get that. And if you're asking me, is it better to be in the company regardless of ownership or not be in the company? Yeah, it's better to be in the company. But it's even better to be in the company with ownership, because now you actually have gotten your ownership that is going to drive real returns.

Because the problem is, once it's an outlier, everybody knows about it. It's no longer a selection game. It's just, OK, can you get access? And it's a position sizing game. There's no alpha there. And that's the truth. In the AI greatest hits, everybody knows these companies.

How much of your fund will you put in a single company?

I don't think we would put more than 20% of.

Have you gone up to 20% before?

We have hit 20% on one company.

Whoa. What company?

Anthropic.

I mean,

it's got to be an exception,right?

Yeah.

Generally.

That was a hard conversation.

We 10x this year. We 10x last year. OK, Venky, let's do it.

But I do feel that you have to think about the question of ownership and concentration as VEN. What I mean is that where was the company? What information do you have? How much conviction can you have it's an outlier company?

Because the thing about position sizing is you want to position sizes when the data is there. And if you position size it ahead of the data, then you're taking a lot more risk. So the question is not, did you put 20% of the fund of a company in one check at the beginning of the fund, or did you ladder up to 20% on the basis of new data?

Obviously, it's much better to ladder up on the basis of new data. And I think in an era where venture capitalists are going to have ownership come down,right? I mean, I wish we could get 10%. Even 10% is hard,right?

Now your way you're going to win is you're going to establish a position and then size up as a company does well, so that you have sized it commensurate to the outlier opportunity.

Totally get you and get that. And everyone says, but ownership doesn't matter so much, because outcome sizes are so much larger than they've ever been. And they are. That is a valid answer. My question is, are they on the whole?

Like, do we just have a breadth of companies that will be much larger, or is it really just a handful of Anthropics and SpaceX? And cursor on the smaller one at $60 billion, which is still enormous and amazing.

But is that a good enough justification for ownerships going down?

I think the problem comes down to your portfolio composition,right? If you are in one of those outliers, I think you can survive with low ownership. But what happens if you are not in these big outliers? Then the because essentially, you're playing a game to use baseball analogies.

You're playing a game where there's only grand slam home runs or strikeouts. There's no singles, doubles, or triples,right? In cricket terms, it's like it's only scoring sixes and not having ones and twos. And the problem with that is that if you don't score the six and you don't have the ones and twos, that's going to be a tough fund.

And so part of getting ownership is giving you some insurance for you that if you missed out on the outlier, the sort of mid-sized outcomes can still move the needle for you.

But will you do singles and doubles?

No. The goal is always to score home runs,right? But sometimes you strike out. And so if you strike out all the time, that's going to be a tough fund. So the idea is that you want to at least say, OK, I went for the home run, and I got a triple.

But I just don't think founders are aware, and I say this, and people always get at me, and I think they kind of miss the point, because I say it lovingly for awareness of founders, that the game has changed and that going from $1 to $4 million, and then $4 to $8 million, and then $8 to $16, and then Venky, in five years' time, we're going to hit $30.

That's an amazing achievement. But it is just not enough to get venture excited today. Do you agree with that?

Yes, I agree with that. Again, snapshot in time, because you're seeing companies like.

But do you think venture will ever go back to being excited about that?

Well, they're not excited about it today because they're seeing companies go from $1 to $10 to $50 to $100. So they're getting to $100 in three years. Or in some cases, they're going from $0 to $1 billion in 18 months,right?

So when you see those kind of companies, of course you want to do those, not the ones. But that's because we are at a moment in time where there are certain trends allowing you to do it. I don't think this continues forever.

And so I think this is where I think you have to take the long

horizon look at this,right? There were companies who grew they grew fast, but there's a combination of things that make these companies grow fast today that may or may not continue.

Totally get that. When they grow as fast as they are, the rounds come thick and fast, and the prices are high.

Yeah. I mean, you look at instinct. God bless. I wish we were in the they've gone from, I don't know, $250 million to $10 billion in 10 weeks.

Would you have done that round at $10 billion?

Smart people have done it. We are in town, which we love and we think very highly of, and we're excited about that. I think that there's something going on there. There's a true phenomenon. What I don't know is to understand their data and what it costs for them to keep growing their user base and how does the muse launch affect their growth.

Can I ask you? Everyone kind of goes into a lot of investing now with the idea that there's downside protection. I mean, NOAA is incredible. It's in a very strategic space with the incumbents. Worst case, $1.5 billion licked pref.

It's a no-brainer for Microsoft to do it as an addendum to a co-pilot or Apple to do it. Jesus, Apple, please do it. Do us all a favor and save us from Siri. Do you think that downside protection, ah, don't worry, the incumbents will buy it, is OK to have or quite a dangerous mindset to have?

I think you can easily rationalize a lot of things if you take that mindset. And the problem is that, again, you threw out this $1.5 billion number casually, because we are in this environment where AMD is buying a company for $8.5 billion, NVIDIA bought Hugging Face for $14 billion, Stripe bought Open Router allegedly for $8 billion.

Allegedly. Allegedly.

Allegedly. And I think we have to go and see these are a point in time where companies are doing it. It may not be that way. And so today, it feels like $1.5 billion is, oh, no big deal.

If I'mright, it's going to be worth $100, $200 billion. If I'm wrong, someone is going to pick it up for $3, $4 billion. By the way, that's what you're referring to my tweets. I wrote this thing about if you go back and look at doing the .com era, Nautel bought Kairos for $3.5 billion.

Lucent bought Chromatus for $4.5 billion. These were companies with no product, no revenue, just teams. And they bought it with their stock. And so it felt very similar. In fact, I believe Jeff Yang from Redpoint, legendary investor, had this quote in the Internet Standard, which is a magazine that doesn't exist anymore, where he said,

you know, there's no risk in venture capital. If the company is successful, it'll be sold for billions. If not, it'll be bought for the private stack. And you know, it didn't quite work out that way on the other end of the cycle after

March 2000. So

I go with trepidation, but I just wouldn't take the mindset, oh, some large strategist is going to buy my company for the provincial stack, because they don't care about the investors,right? They care about the founder. Why would they do that?

Why wouldn't they just hire the founders for the same package?

In a lot of cases, they kind of are in these structured deals, let's be honest, and screwing the investors.

So you've seen that. And you can't take that. There's no reason for them to take care of the cap table.

Do you think about the dilutive nature of businesses today? And what I mean by that is just like we are suffering more and more dilution as an investor class than ever before. And it's a better time than ever to be an employee, given the levels of stock-based compensation, SBC for people.

Do you worry about that? Think about that? Should I worry about that and think about that?

For sure. I mean, we look at whatever we invest in at the seed round, and we assume by the time we sell or exit the company, if we own 10%, we would have 3.5% to 4%. We expect 60% dilution from the point of our first check,right?

And that's a combination of dilution from financing. There's a dilution from option pool expansions. And so you have to really think of yourself as whatever ownership you bought in your first check, it'll only be 50% by then at the end.

The interesting thing is that it's very common in a lot of companies we're seeing today. And then the other interesting thing is companies are sometimes scaling so fast, à la Open Router. Alex, a friend of both of us, where they actually don't take that much dilution because they scale so fast, so quickly, and so efficiently, where actually you suffer almost much less dilution.

So it's almost a tale of two dilution worlds. Do you know what I mean?

Yeah, it's a function of time. So the way to think about it is that and I don't think we spend enough time in venture capital thinking about it. We should say, what is the time horizon you're going to hold the company?

Because the time horizon will determine your dilution,right? So part of the reason when you are in a situation where your dilution's less is they have quick exits. They grew their value fast. They have quick exits. And that's a double win.

When your time horizon is long, there are two hits. Your IRR gets hit, and your dilution, you're going to have meaningful dilution.

Did you think of that when investing, which is just like, what really is the ramp? There's like businesses like in the ERP space where they're like, ah, but the revenue's such high quality, Harry. I get you. It's not as fast as your Higgsfield or your Legora, but it's so high quality.

And I'm like, yeah, yeah. Fuck, it's slow. Am I wrong to think that?

Nope. I think the velocity of the business is very important for venture capitalists,right? And the velocity will determine a bunch of things,right? Because the other reason why your dilution goes down is like if you have a fast uptick in valuation, the amount of ownership you've got to give for your next set of recruiters, next set of human capital is a lot lower,right?

So you are a $200 million company, and you're giving 2% of the company to hire a senior exec,right? That's pretty meaningful. You quickly become a $2 billion company. You don't need to give. You're going to give RSUs, and you give the same person $20 million,right, which is 0.1%.

Well, that was 1%.

DPI or IRR?

Both. I mean, you can. I do think, actually, that you can't have IRR without DPI. I think the question you're trying to ask is, hey, will you settle for a larger DPI over a longer horizon, or do you want quicker DPI with a faster IRR?

I think the reality of venture when I joined, this is now dating myself 28 years ago, people didn't focus on IRR. People were focused on cash on cash return because IRR took care of itself. I think in today's venture, the game has changed.

You have to focus on IRR. You know why? Because there's no way for venture to be successful in today's era without the mag seven participating in everything you're doing. Every venture company is writing a tax to NVIDIA in some way, shape, or form, writing their tax to a hyperscaler in some way, shape, or form, and possibly writing a tax to the foundational model in some way, tax of form.

So if you're going to be successful,right, you're going to be writing a tax to all of them. All of them are available in the public markets, or they will be soon in the public markets for someone to invest in a no-fee, no-carry index fund.

And so you have to think about your IRR as I've got to beat that with 1,000 basis points to justify anyone giving you capital in the private markets.

You mentioned town. I had JD on the show. Really like him. I've known him since the Plaid days. I'm pissed off about that one because he started the company when he left. And I remember talking to him about it when he started.

And he was doing something in some terrible space, no offense. He'll agree with me. And then he obviously pivoted.

In tax, I think they were doing something in half of the.

Venky, I'm too old for this shit.

You are too old. What am I? I'm ancient.

You're a spring chicken. And for anyone watching, they'll see that you look much younger than me. But my question to you is, we obviously know what happened with the town round in terms of competitive nature and dynamics there.

I don't want to go into that. What I want to go into is actually, does competition matter for VCs to invest against now? It seems like Andrew Eason has three companies all doing the same thing, and many big platforms do.

Does it matter being in many players in the same space anymore?

I mean, this is a personal preference,right? I think culturally, for Matt, Sean, and I, we'd like to be committed to the entrepreneur. And the situation is going to be so difficult. Look, if we take a board seat and we write a big check, then we want to be.

If it's like if you're investing in the seed round and you have a small check, you're a passive investor, that's a different issue,right? But when we make a commitment to the entrepreneur, we want that to feel like a two-way commitment,right?

We expect them to put the interest of their shareholders and commit to it. And we as shareholders need to commit to them that we're going to. And that's why we didn't invest in OpenAI. We only stayed with Anthropic.

There's no shade. Again, venture is changing in a way that multiple people are doing different things. I think you just have to figure out what is authentic to us and our values and live by those. And I think for us, when we make a big commitment to the founder, we think of it as a two-way street.

They commit to us. We commit to them.

One thing that we see a lot today is the compression and deployment timelines. In other words, people investing much faster. All the LPs that I speak to, they're just saying, God, Harry, Jesus. Everyone is coming back to market so much quicker.

They're bigger. Is that OK, or is that a sign of peak bubble?

Yeah, it's very interesting. LPs want smaller funds, and then they want you to not come back quicker. The problem is, one of those can't be true. If the opportunity we have is real, and this AI is the biggest economic platform shift of our lifetime, and you want smaller funds, they're going to come back quicker.

Now, there are also large funds that are coming back quicker. So that's a different issue. But I think that in the time we are in is one in which you're seeing companies grow so fast, and they need capital to grow.

This is not a situation where you can grow without capital. This is not Google. Google, if you go back, probably raised less than $50 million in the private markets. You can't do that today in AI. You need compute.

You need to scale. So to me, because you're seeing them grow so fast, their capital needs are growing. And if a venture firm doesn't provide it, they're going to get it from their competitor.

So actually, if managers are deploying a fund in 18 months, LPs should forgive them.

I think the LPs should ask questions and say, have you thought about it? How are you managing it? What's going to happen if things go? Vintage diversification does matter,right? It does matter. And people have to be conscious about that.

I mean, when I look at Menlo's history, the one fund that wasn't successful at Menlo's history, 50-year history, we only had one fund that's not a returned capital, which is Menlo 8, which was invested in a 10-month period between 2000 and 2001.

Yeah, that was not quite the outcome we wanted.

Menlo 8.

Menlo 8. But I bring that up because I do think time diversification matters. Now, by the way, Menlo 7 was one of the best funds in Menlo history.

Yeah, but you remember XL 2005, just pre the Facebook fund. And they had massive LP churn because they went and did a load of clean tech and bio, and it was not good. And then Facebook fund.

So to me, I just bring that up as like, look, as GPs, you've got to take the fiduciary duty you have to your LPs very seriously, and you've got to balance that decision. What I do know is that you can't have you can't just have dogmatic rules.

You have to play the game on the field. And then you have to communicate what you're doing in a transparent way to your LPs and tell them what's happening. And some LPs are going to be like, OK, I agree with you.

I want to play it. Some people are not. And you've got to respect that. But the point is that you might have no choice to play the game this way.

Did you ever scale out of an LP class? And what I mean by that is the funds now are reasonably sized. They're not egregiously sized. You're not David George asking for the US Treasury, but you're $3 billion. It's a lot of money.

For some LPs, they're like, it's a lot. Was there a time when you scaled out of endowments, say, and suddenly you had to be pension fund invested?

We have historically our anchor tenant has historically been the Washington State Investment Board, which is the public sector pension fund of the state of Washington. From Edis LP, by the way. I highly recommend them to anybody. They've been our anchor tenant since 1981.

So we have never had a reason to scale out because public sector pension funds have been a part. It's a little bit of a cultural dynamic. I think the founders of Menlo came from very humble beginnings. DuBose grew up in a house with no running water or toilets.

I think John was orphaned very early. He was a scholarship student at MIT. And so they loved the idea of working for public sector employees because that felt like working for their parents, unless these people looked more like their parents than their children.

So there wasn't a fund where LPs went, oh, Venky, you're getting pretty big now. I think you're just scaling out of our sweet spot.

No, that wasn't the case. But we raised the first $1 billion fund in venture capital. Menlo raised Menlo 9, which was raised in 2001, was a $1.5 billion fund. And Menlo 10, which was raised in 2004, was a $1.2 billion fund.

Those funds did not perform as well as we would have liked. And many LPs did leave us.

You manage a lot of the LP conversations today, correct?

I do. Matt and I do a lot of them, yes.

What do you hear from them? As I said, I hear deployment time is down in terms of how people are investing much faster, and the funds are just getting bigger. And then I also just see mimicry, which is like, I'm calling this out because it's a compliment to her.

And I never shit down on people other than your piece.

Every LP just wants Sarah Groves' fund. And I completely agree Sarah Groves is incredible, and you should want her fund. Great. But just this complete herd mentality.

And Sarah and Mike are amazing.

Amazing.

No question about that. I spend a lot of time with them, with LPs. And I think, first of all, a lot of them have two complaints. One, they're like, enough TV over PI. I need to get some DPI.

So I think if you deliver DPI, I think you're already in theright side of the table. And I think it's easier to come back to them to ask for more capital when you deliver DPI,right? So that's one. Second, I don't think people can afford not to be in the AI economy.

And I'll tell you why. Most of them have much bigger private equity portfolios than they have venture portfolios. Like in many cases, 3 to 4x exposure to private equity. A lot of private equity over the last few years have been software.

And those positions are directly impacted by AI. So if you want to hedge against your private equity portfolio, you've got to be in the AI economy. And so that's the piece that forces them to come back. So if you are someone who has given people DPI, and you can credibly make the case that you are going to be a player in the AI economy, I think you can raise money from LPs.

You've got to have given DPI. We see companies scale faster than ever. As we said, we see prices that are very high. How do you think about the internal conversation of, whoa, X company is now valued at $10 billion.

Can we take some chips off the table? What does that discussion look like? And any lessons on how to sell successfully?

I think you have to

step back and look at any situation in which you have a 30, 40, 50x return on your dollar and ask yourself, should I take some off the table? And I think theright time to do that is when the entrepreneur is thinking about taking someright off the table.

And I think if you were to work in conjunction with them.

What if it's not material? I'm using this as a consulting lesson. You can invoice me later. I have a company where we are like 40x up. And you're like, wow, fantastic. You've got $100k in there. Returned $4 million back to a $100 million fund that it's in.

I don't think it's a size issue. It's just, to me, like, look, lock in the gains,right?

They were thinking if you go back to the SaaS portfolio in 2021, there were valuations done at, let's say, pretty high prices. If people had taken 10%, 15% off the table, even if it's small, it locks in, allows you to go long.

The other thing I tell entrepreneurs is that just like when you take some chips off the table, you're more likely to go long. So are we,right? Because we can now afford to go long with you. And so it aligns.

And so to me.

Will you ever sell all of your position?

Generally, no. Not unless the company is being sold. Not interested. I think that's a different situation. I mean, the only time I think it's like if you do not have a relationship with the founder, and that's different. But as long as you are and you're in, you're going to we ride and die with our founders.

Jason Lemkins says on the show, whenever a founder leaves, like, I ride it to zero. When a founder is gone, it's zero, zero, zero. Do you find it to be the same when the founder leaves? You're like, we're supportive, of course, and we're still here.

But mentally, you're like, not to zero?

My friend and your friend, Nikesh Arora, would disagree with you and say he goes on founder mode. I mean, look, there are people like Nikesh, G2 Patel at Cisco. They go on founder mode as an exec. And I think it's sort of an insult to people like that when you say, oh, the founder leaves.

Look at the situation. Who replaced them? Founder mode is a mode of working. It's not tied to anyone personally. I think anyone can be a founder in terms of working in a founder mode. And I think some people do.

I mean, Frank Slootman, look at Frank joined Data Domain,

Snowflake, ServiceNow. In each of those places, he acted like a founder. He didn't act like an exec.

By the way, Nikesh, please don't kill me. I love you more than ever. And I've always loved you. And it was Venky that said it. It wasn't me that said it. I'll give you Venky's address later.

I'm going to get a bridge from him.

You'll definitely hear from Nikesh.

I'm terrified of Nikesh. Are you kidding me?

So yes, that's very funny. Can I ask you then? We see so many sales now. It's like, FeiFeiD sells for $8.2 billion. It's like, it's amazing. A phenomenal exit. Well done to everyone involved. Yesterday's news. I mean, OpenRooter is so yesterday's news.

We've all forgotten about it. And I don't mean this glibly or any I know that sounds so child of this ecosystem, which I'm not, sadly. Are we just going to see a load more exits now?

Yeah, I think you're going to see because I think there's competitive pressure. There is also this notion that we have a regulatory regime that will let you do M&As,right? There's been a backlog of M&As that's been supposed to happen.

Didn't happen because we had a different regulatory regime. There's this notion that this may not continue forever. So one, you have a window of time. You also have competitive pressure,right?

When AMD buys a real-world model, does Nvidia need to do something? Do other people need to react? And so I think every acquisition forces a bunch of competitive dynamics we have to consider. And then people have equity prices,right?

AMD is now a trillion-dollar company. $8.5 billion is still, I think, less than 0.1% of the company. So you can do stuff because of this combination of things. And then the notion that anything that lets you catch up in the AI wave is very high.

Did Meta do a good job paying up for scale? I think they would say, yeah. If you look at the market cap add-up news to Meta, maybe that $15 billion seems cheap now.

I'm also so happy for Zuck. It feels like he's kind of almost got like a co-founder in Alex Wang, who he can delegate some of the shit to. Do you know what I mean?

I mean, Zuck is a great capital allocator. Go back and look at the history of his capital allocation has been phenomenal.

Best of CEOs.

He bought Instagram for a billion dollars,right? He has executed. And I would say.

He bought a Novo for $400 million, which allowed him to see everything that would. So smart.

So to me, if you look at the history of I think they're incredible technologists, but I think there are very few people, I think, who are incredible technologists and good capital allocators. Zuck isright up there.

If you could choose one skill for a founder at scale between capital allocation or product visionary, what would you choose?

At scale, I would choose capital allocation. Because by the way, capital allocation by itself also captures product visionary because you're allocating the capital to the things that matter. So in some ways,

part of the dynamics of deciding on capital allocation is which product direction you need to go. But the other way is not true. There are some people who can be great product visionaries, but who might not think about what is going to be the return on that.

Evan Snap. Love the dude. Love the dude. I mean, free candy every year. SBC through the roof.

You're a shareholder of Snap?

We are not a shareholder of Snap, but look, Evan is a product genius. There's no question about that,right? And his vision for Snapchat and what he's executed.

Stories.

But I think it would be fair to say you have not been rewarded being a shareholder of Snap, at least for the last seven, eight years.

Not been rewarded?

I was trying to be polite here.

That's like giving Titanic an 8 out of 10 in the holiday review book.

That's incredible.

I mean, not being rewarded.

Not been rewarded.

I blow hard.

Yeah, no, that's a good way to put it. OK, that's really interesting. Are you worried by how much money is being made by people? I'm seeing sales reps at OpenAI walk out with $30, $40 million bucks.

You know, here's the thing. I always believe this. Money doesn't change people, but it reveals them. So what do I mean by that? Is money and power, people think, changes people? No, it only reveals them. What it means is like if you were an asshole before, when you have money and power, you reveal that.

And so what I have found is that the people who are really motivated, they're going to be motivated

even if they have lots of money. And the people who are not motivated, who are acting it, when the money shows up, they will opt out. And so to me, it won't change for the A players. Because for the A players, money is just a way of keeping score, but what they love is the game.

So you're not worried about house prices in the Bay and the inflation that we're going to see with IPOs from SpaceX, Anthropic, OpenAI. That worries you?

Of course it does. I mean, it changes the character of the place. But the real issue we have, and this is an issue in California, hopefully not in London, is a question of supply. It's not a question of demand.

At the end of the day, we have tremendously increased the cost of in the process of building a house. There's no supply coming in. So any uptick in demand results in prices going up. The way to address that is not to worry about the demand, but to increase the supply of housing stock.

And we just do not have the collective willpower in this. For a progressive state, there's more nimbyism in California than I expected. And the nimbyism prevents you from building more housing stock.

I saw a tweet where you said something. You responded to Brian Armstrong. I do my work.

OK, allright. That's dangerous.

Yeah, it is dangerous, but I'm joining you on this side if this is where you're going. And you said, I appreciate your leadership through the woke times.

I mean, I think what I particularly appreciated about Brian is that he laid out his principles of what he believed. And he told people, hey, if you really want to engage in political activism, then Coinbase is not the place for you because we do not want to have political dialogue here.

And if that's important for you, you should go and find a place in which you can do it. I think that takes courage to say. And I think, but it's being true to what he wanted to do. And to me, I think that's the most important thing, try to be authentic to who you are.

And I think I appreciated him being authentic when I think it came at a cost,right? There were definitely he was castigated in the press and maybe on Twitter. And he had people leave. But I think he ultimately said, we want people who are authentic to Coinbase values articulated by me, the founder.

Have you ever been inauthentic to who you are?

I think there are times when you say certain things to founders because you want them to like you or you want to win a deal that I think may not be truly authentic. What I'll tell you is that I have dealt with my own insecurities and feeling like an impostor.

And I've gotten more comfortable in my skin now where I just feel like I just don't do it. And if it means I have to say something inauthentic to me to win the deal, I'd rather not win it.

But that's easy to say because I'm sort of at the point in my life where that win doesn't matter. Of course, I like to win, but it's not going to change my life. So I always say, it's very different when you're a 25-year-old and you're trying to build your career.

You do whatever it takes to win. And so in some way, morality is sort of a privilege of the people who have already succeeded. It's easy to be moral now when you already have the things you have. The question is, will I be a moral person if I were to go back 20 years ago and start there?

That's the real test. And I don't think I've lived to that test as much as I would like.

Are you a better investor now you're richer?

Yes. You're not afraid as much. You're not afraid of failure. You're willing to go all in and

go to the hilt. And so I just think you can go for broke more easily,right? It's sort of like think about it on a poker table. The guy with the big amount of chips has so much leverage to win,right?

They can see more cards. And so ironically, and this is why I think the way our capitalism system is set up, the rich are going to get richer because they just have more opportunities to be the bully on the poker table.

Does that mean that emerging market not emerging market, but emerging managers are just in the old stack to get in some game? I don't see and forgive me for this, but I don't like binaries, but that fucking room media so you kind of have to do binaries.

It depends, doesn't sell. $30 to $100 million funds are just the worst place to be.

Yes, they are today. Again, snapshot in time today, that's a tough place to be because you're playing in a poker table where people have such high chip stacks.

And they were five years ago, dude.

I think what happens is if you are lucky enough,right? And I don't know if this is true, but I'm sure if you were to go and look at the cap table, there was some small investor who wrote a check.

Oh, Arjun wrote a check into Anthropic. Now, maybe he didn't have a fund then, but you wrote a check. You wrote a $30 to $50 million check. You wrote a check into the Anthropic round, not the $4 billion round we did, but much earlier.

You're doing fine.

Yeah, but he was an angel not competing four rounds. And so what I'm saying is the $30 to $100 million funds where they need to move like $1 million, $2 million, $3 million, it's kind of a pain to fit them into rounds.

No. Arjun putting in $100K or $200K, sure.

I mean, I would yes, I'm just your principle isright, but I'm just trying to think about I try to be intellectually honest,right? Think about conviction. How did Sarah and how big was Sarah's fund? I want to say $200.

The first one was, yeah.

So $200 million fund, and she found a way to be in some of the most interesting companies early. So it can be done.

And then you've got Dave Tisch, I think it'd be a really good example actually as well with Box Group.

Yeah.

It goes against the portfolio construction that all LPs love, which is high ownership, concentrated portfolio.

And so I think that there's always people who figure out how to play agency odds,right? But they are the best of the best. And so you don't want to extrapolate. But in general, those are tough places to be unless you're exceptional.

And I think I was reading a tweet between Sarah and Patrick Rady. And Patrick Rady, she was like, Sarah was telling LPs, like, my strategy is I'm just going to work harder. And that's probably the truth,right? The truth is everybody wants to have some magic strategy that you're going to do that nobody else is going to do.

There's no magic strategy. Everybody in the venture industry is smart. You have to out-hustle and have grit to make through. And Sarah definitely has to.

Final one before we do a quick fire. We mentioned PE being challenged in a lot of ways by a lot of AI companies. We're seeing the keys being handed back at companies like Medallia. You're seeing plenty a lot of struggling companies in a lot of these PE providers' books.

Is PE pretty structurally fucked?

Look, they're smart guys, and they know how to figure out and operate these companies,right? They also have majority control. I think in some ways, I would say the venture-backed companies, that SaaS companies where the people paid high multiples, the ad tables and murals, I think they got spooned, as I say.

And I think those are in a tougher situation,right? I think

I think PE is a challenge too. But the reason why I say the venture-backed companies are even tougher situation, at least as PE, you have a majority owner who controls the company, who can do things. You have a lot of zombie SaaS companies where nobody owns enough to be able to do anything.

Nobody cares. And so how do you actually land that ship? At least as PE, they can do some stuff to it. Now, landing that ship is going to be hard for everybody. But I think in that class of 2021 SaaS companies, the best outcome is getting spooned, which really means getting your capital back.

And the worst outcome is going to be zero.

Good opening sprints. European. Just going to put it out there. So the quick fire is a combination of mine and Joff on your team.

OK, Joff.

Yeah, yeah. He came back with some bias.

My opponents.

Why do you love pocket squares?

When I was growing up, I didn't care about how I dressed. And I did not take any effort into it until I had this one conversation with my dad when he said, listen, when you dress, you're not dressing for yourself.

You're dressing for others. You're showing them that this is an important meeting, that you're expressing the importance of what you're doing to them. And so to me,

my partners make fun of this. I dress up for partner meetings because it's like a self-message to me about the people I'm meeting are very important, and what I'm going to do is important. I need to take that very seriously.

Now I feel guilty. Christ, way to make me feel good. Joff teed me up for that one, didn't he?

Yes.

I like that. It's really nice. Yeah, yeah. Fuck. Good. Well done. I should probably think about that more. You can invest in one seed fund and one growth fund. That's not Manlo.

That's good.

Which fund do you invest in?

I have tremendous respect for the best of my folks. I was a co-founder with Byron, and I've known David Khan. And I think they are super disciplined. So if I could invest outside of Manlo, I would invest in Bessemer.

That's for the growth fund. What about the seed fund?

You know, so I'm looking for people who are going to be in interesting AI companies. There's this group of guys called E14 out of MIT. And I find them to be in interesting AI companies. And they seem to really understand the MIT ecosystem.

Who, when you hear you're competing against them, are you like, oh, fuck?

I think of more people than firms. But I would say Benchmark, super hard to beat.

How much more harder to beat than Sequoia?

I think so. I mean, obviously, they're both great firms. But Benchmark, I think, is super hard to beat. And whatever they do, combination of Eric, Chetan, and Everett, and Jack, they are just a beast.

What would be your single biggest piece of advice to an LP allocating into venture in this time?

Look at the windshield, not the rearview mirror. The results and financial performance are rearview mirror calculations. And they're good about telling you what they did in the past. They don't tell you how some of the firm's going to do.

The things like performance is a lagging indicator. And it's actually a five to seven-year lagging indicator. So my advice would be call a bunch of entrepreneurs or successful AI companies and ask them who are the partners they respect.

And my email, they didn't take the money. And if the firm you're talking to doesn't have a few of those partners in the mix, then that's your windshield.

How do you stop your team getting arrogant? You guys have got the winning hand.

You're only as good as your last investment. And so to me, you have to go into the mindset. I always say, it doesn't matter if you're the lion or the antelope in the savanna. You wake up in the morning if you're the lion.

If you don't run, you don't eat. If you're the antelope, you don't run, you don't live. So you just have to run. And I feel like you have to think about the most important meeting is the next one.

The most important investment is the next one. The most important board meeting is the next one. And if you don't spend time in the present thinking about it, I think you lose in this game.

What's the secret to marriage when you scale wealth over time together?

Oh, wow. Well, you got to marry someone better than you, which I did. Thank you. Thank you. And you got to convince her to stay with you or whatever your preference might be. Finding a life partner who inspires you to be the best version of yourself and supports you to be that is, I think, critical.

And if you can do that for each other, I think that'll because I think at the core of long-term marriage is, I think, real respect,right? It's love and real respect. But I think respect is super important. And that comes from inspiring each other to be the best version of you can be.

What's the best advice you've ever been given? You mentioned Mr. Steve Sloan and his father-in-law. His father-in-law is one of my closest friends. And he once said to me, you're never wrong to do theright thing. But theright thing is very often the hard thing.

Yeah. I think the best advice I've gotten have really centered around sort of being

around people.

I think that Ronald Reagan has a quote that Tom Riley, who was a CEO of Twigo, told me once that there's no limit to what a person can do as long as you don't care who gets the credit.

And I have felt when I was early in my career, I was very focused on getting credit. I really like, am I going to get credit? And then I have let go of that and focused on just doing what'sright and not worrying about if I'm going to get credit.

That's actually been pretty freeing. And I think that's made me a better teammate.

I love that. I don't think there's a better way to end than on that. Your humility is astonishing. It's really just like, one, you're very calming. I almost feel like you should be on headspace or calm, one. And two, it's just a wonderful humility that I rarely see in a venture investor.

But thank you so much for doing this to me.

You have too many successful people on your show.

I tried to lower the bar for you. I've so enjoyed this. Thank you for doing it. And you see shows like this, why it's so much better in person. You can't have this virtue. So thank you for doing it.

Thank you, Harry. And thank you for look, I have to say, my colleague Claire was coming with me, and she said, I watch Harry all the time. He has become my favorite show, especially the one you do with Rory and Jason.

And this is what she said, this is Trump the All in Podcast as my number one show. So I have to say, you're getting fans all over the place.