The Distribution by Juniper Square
00:24:30 · Nick Shalek
You know, I guess PayPal would be a counter example. But other than that, nobody had built really big businesses. I mean, Square and Stripe had been started, but, yeah, they were they were still pretty nascent. And the thought was that mobile and digital distribution, you know, the the banks could, in theory, compete, but they're gonna be too slow. And there'll be entrepreneurs that get emboldened to go take on this problem of actually serving end customers, and they're gonna use mobile. And the changing point of sale, you know, people won't go to branches in the future was, like, the the really simple thought. And I loved Mickey's thesis. I liked him a lot. But I also told him, you know, sector focused funds. Because he got excited about this idea and wanted to start a fund. And my view was like, I'd learned that Yale sector focused funds don't really work in venture because, you know, the opportunity in venture might be in one place today, but it's gonna be somewhere else tomorrow. And this was... This kind of conversation was was what we, you know, what we built a relationship around. He also, you know, from the very start, he wanted to and then we wanted to, when we started working together, make Ribbit an international firm. Like, we thought this opportunity would play out all over the world. And while I'm a coastal American, he's very much an entrepreneur who had built in a lot of places. And so the aspiration was to build a global firm or a firm that operated from The US but invested globally. And that was also anathema, you know, in venture. You were supposed to be a generalist, sage disciplined, and geographically focused. You know, famously, Sequoia. I think Don Valentine said, you know, we only invest in companies that we can ride our bikes to, you know, because you wanted to have that close personal relationship and understand all the context. And so we set out to do that thing, but to do it globally. And that was kind of the start of Ribbit.
00:26:16 · Brandon Sedloff, Nick Shalek
[00:26:16] S1: So that was, what, roughly thirteen years ago? [00:26:19] S0: Yeah. It was 2012 when we officially started to the first fund. [00:26:23] S1: So to... I mean, if if people Google Ribbit, they'll see all kinds of amazing accolades for the organization. I love what you said about, you know, backing rebels who challenge the status quo. Help me just... You know, help our listeners orient kind of Ribbit today and maybe, you know, size, scale, you know, known for fintech specialization, portfolio companies, kinda any... Anything. And, you know, if you don't promote yourself, I will help you, but, know, help help us orient kind of what the firm does today and kinda where you're where you're focused, you know, where you have the most conviction right now.
00:26:57 · Nick Shalek
[00:26:57] S0: Yeah. Our our thing, I I'd say from, you know, kinda from a a principle standpoint is it's concentration and conviction in in all things and and compounding. Those are, you know, kind of the, I guess, call... We'll call them the three c's that that drive a lot of the way that we think. We've... You know, we're now on, I guess, stats wise, we're we're now on the the twelfth fund or something. We've we've had a lot of different vehicles. We've always tried to undersize our funds so that we can be flexible in the moment and have had the belief that, you know, you take some vintage risk if you invest, you know, in a small number of companies in a fund, but that's more our problem. Our LPs are highly diversified across a lot of managers and asset classes. And so we've always, you know, we've we've always had the attitude that we should have a a smaller number of investments per fund than other people. That's led us to have, you know, have more funds, and I I can say more about that. But I guess by AUM, we've gotten quite large. Some of technology industry has grown a ton in the period that we started. So... But we've we've actually made our core funds smaller. And we've done that in a period of time where the asset class is getting bigger and other funds are are raising larger and larger funds. And I think that makes a lot of sense strategically for them. I think for us, going smaller has been a commitment to the idea that we wanna find, you know, we wanna find these entrepreneurs, these these rebels, and we wanna try to be their most consistent, pragmatic, trustworthy partners through cycles of greed and fear and change and and be there for them along the way. And you just can't do that with hundreds of companies. You you you can only spend that kind of time and attention and be that type of partner with a small number of bets. So we'll try in a fund to, you know, invest in 10 or 12 core positions. You know, that that might be six or seven or eight core investments a year and plan to work with those founders if we can for a decade or longer. I mean, with some of the the early companies we backed in Ribbit one or two, we're still buying their stock or, you know, going to their board meetings, talking to the execs and team all the time. And that's what we're... Was trying to do with the firm.
00:29:14 · Brandon Sedloff
[00:29:14] S1: Before we we kind of advance, I have a I have a lot more questions. But, you know, for our listeners who aren't familiar, you know, kind of a sampling of some of the portfolio companies or companies' founders that you've backed, help us help us understand.
00:29:27 · Nick Shalek
[00:29:27] S0: Yeah. Well, we we... We've invested on names, some companies, Coinbase, Robinhood, Stripe, Credit Karma, MercadoLibre, Juniper Square, of course, you know, extremely importantly. So I'm starting with the the the fintech entrepreneurs we backed. A bunch around the world that listeners may not... May or may not know but have been, you know, phenomenal companies. Maybe I mentioned New Bank or Groww in India. Just went public this year. It's the leading stock brokerage in in India. We backed an amazing founder in Korea in a company called Toss. Some great entrepreneurs in Southeast Asia, Forrest. Li and and team who run a company called Sea that's become a a really big, impressive Internet company. A bunch of a bunch of great, great folks. Revolut in Europe, which has, you know, become a monster business, has really special culture and team. More recently, we're... You know, because the... I'm talking about things we invested in, you know, seven, eight, nine years ago. We've been investing quite a bit in the AI, you know, broader AI space. And in, we would say, the intersection of money, knowledge, and power, and especially those intersections, things around, you know, entrepreneurs building capabilities that apply... You know, that that can make every organization better. That would be companies like Decagon, which is an AI platform for customer support. Or recently, we announced a round with Listen Labs. That's a a company building a really amazing tool that we were using internally. You can think of it as an agentic version of customer research like Qualtrics. But my opinion, you know, easily 10, maybe a 100 times better product experience when when you use it. So a wide range of things, but that maybe gives people a sense.
00:31:09 · Brandon Sedloff
[00:31:09] S1: Are you and your colleagues thinking about AI? If so, you're not alone. Nearly every conversation that I have with private markets leaders today involves a discussion on AI. Firms are trying to benchmark where they are relative to their peers, but more importantly, they're trying to figure out how they can improve and adopt more AI in their own business. I wanna introduce you to Juniper Square's five minute AI assessment. This will help you find your current level and also see what it takes to reach the next level of AI maturity for you and your organization. To take the assessment, go to junipersquare.com/assessment. That's awesome. So I think, you know, there's a few tidbits to pull on, but, you know, this notion of kinda backing founders through periods of change, whether it's, you know, to the upside or the downside. You know, right now, we're going through kind of an AI revolution. You know, the cost of intelligence is is going down to to near zero. You know, from from your seat as a as a venture investor backing founders focused on fintech, like, how how would you... How do you think about AI and the impact that it will likely have, you know, on society, but but really just on kind of the the the businesses that you back in the way that, you know, we collectively as a society do business and and think about interacting with with different tools and applications?