00:44:20 · Marc Bhargava
[00:44:20] S0: Right. Well, the holding companies that we help incubate and fund are pretty much exclusively in San Francisco and New York. So out of the, you know, eight or nine deals that we've done, I think six are here, and two or three are in New York. So we have seen that talent has come back for sure to the Bay Area. It's like the center of applied AI, research AI, and then New York too for financial services especially, and some of the really great m and a specialists or people who have built and sold companies are out there. So we're primarily working with really experienced entrepreneurs, second time founders, amazing operators, and they tend to be between SF and New York. Then the companies, once we create the holdcos and then create the software, we show the automation, now we're actually buying businesses. Those are almost never in San Francisco or New York. They're all across the country. Increasingly, it's getting more global. We invested two rounds in a company called Dwelly, which is out in London, which is rolling up property management and scaling really well and also doubling the EBITDA margin of the property managers they're buying. And we've also done a deal in Germany in the accounting space. And so increasingly now, well, my answer was at first US. We also have bets in, like, UK and Germany, and we're looking at this strategy really closely in India too. And Europe has much lower entry multiples. People sometimes rat on Europe that it's hard to build a big company because there's so many markets. In some ways, the AI enabled roll up is really perfect for that because we can buy our way into new markets and iterate, and it's the same back end technology to automate accounting, for example. And so increasingly, this will be a more global strategy. But to date, it's been New York, SF, London, and Berlin.
00:45:54 · Molly O'Shea, Marc Bhargava
[00:45:54] S1: When you go global, do you keep the teams here in The US and then the operations over... Like, how does that work? [00:46:01] S0: We normally we normally invest in a separate company to do HOA property management roll up, for example, in The UK, which is Dwelly, and they'll expand to broader Europe, for example. So we... Right now, none of our roll ups are really working internationally with the exception of one that's rolling up software companies, and they're based in Canada but are between Canada and The US. [00:46:23] S1: I mean, more on, like, the talent side. Like, is the talent in those geographies as, I'd say, like, AI native as they could be in The US? Like, how does that quality wise compare? [00:46:35] S0: I think it's less US versus international and sort of SF Bay Area versus everyone else. I think SF just has a much higher density of talent and quality of talent than really anywhere else in the world. But I think it is exciting that there's a lot more homegrown, great companies in New York and in London and Berlin, and the quality of talent is rising in all of these other places, so much so that we definitely are investing more in Europe and investing more in India. But in terms of where's the absolute top tier talent in the world, I think it's still here in the Bay Area. There's nothing special about the Bay Area except for it attracts all the really great people to, you know, leave wherever they are and come work here. So that's been the draw.
00:46:35 · Marc Bhargava, Molly O'Shea
[00:46:35] S0: I think it's less US versus international and sort of SF Bay Area versus everyone else. I think SF just has a much higher density of talent and quality of talent than really anywhere else in the world. But I think it is exciting that there's a lot more homegrown, great companies in New York and in London and Berlin, and the quality of talent is rising in all of these other places, so much so that we definitely are investing more in Europe and investing more in India. But in terms of where's the absolute top tier talent in the world, I think it's still here in the Bay Area. There's nothing special about the Bay Area except for it attracts all the really great people to, you know, leave wherever they are and come work here. So that's been the draw. [00:47:13] S1: You've been at General Catalyst for a couple years now. What is the biggest lesson that you've learned from Hemant?
00:47:20 · Marc Bhargava, Molly O'Shea
[00:47:20] S0: Definitely advocating on team and paying up when you have to. Like, I got to learn from HD some epic stories about how GC got involved in Stripe. And, you know, I won't repeat all of the details there, but there are some companies you just really wanna be in. And it's less about the terms. It's more about catch them early. Like, you can buy 10 or 20% of an iconic company at seed or at a or at b. So a lot of people have the mentality of, oh, this is a $100,000,000 check. Let's spend all our time. This is more important than like a 1,000,000 seed check. But the reality is normally your 100,000,000 check is buying you 10% of a company. Your seed check for 1,000,000 is also buying you 10% of the company. So it's really important to kind of what are going to be the next 50 iconic companies and ideally try to catch them early and pay just as much attention to buying 10% of some seed business as 10% of an established business. So we have really at GC shifted a lot our focus on seed with the acquisition of La Familia and bringing in Jeanette and who's running our Europe practice and as a very prolific seed investor from La Familia. Venture Highway, the India seed firm that we also acquired we brought in recently, and then Yuri to come lead our US seed practice. He had a successful seed firm. So I think that mentality we're really pushing through, which is can we buy 10 to 20% of companies early rather than certain types of investments are more important than others? It's really how do we get those iconic companies, 10 or 20% of them. [00:48:46] S1: So intense.
00:48:46 · Molly O'Shea, Marc Bhargava
[00:48:46] S1: So intense. [00:48:47] S0: Yeah. There's a lot going on there. [00:48:50] S1: There's a lot going on. So what are you most looking forward to in the next twelve months?
00:48:56 · Marc Bhargava
[00:48:56] S0: In the next twelve months, I think becoming much more public about our thesis. You know, some of our best roll ups have decided not to do any press whatsoever, which I think is... And I can understand where they're coming from. They're cash flow positive. Like, you know, some of the companies in the roll up will hit a 100,000,000 of EBITDA, and they're, like, less than two years old. Oh my god. Companies like that who say, for generating hundreds of millions of free cash flow, we don't need to be out fundraising every three to six months and doing the press tour and promising people AGIs around the corner. And, like, you don't... If you have a good business and you're making a lot of money and you're seeing AI implementation really working, a lot of our companies have remained really quiet or more stealthy despite doing amazing. But I am excited to hear these stories come out much more publicly, and obviously, we'll send them your way as well. But in the next six months or a year as we have these amazing proof points that I get to see being on the board of many of these companies, we're start... We're gonna start telling our story much more to the world with an angle of working now with more crossover firms, starting to prepare them to go public. It's really an amazing journey. For me, it feels a lot like in 2016 in crypto, there were a few people who thought it was legit, like USV and a 16. But most of the market was just trying to be polite because they didn't wanna offend USV and a sixteen z and Founders Fund, which was obviously really involved directly in Bitcoin. They were just trying to be polite, but they didn't really believe in it, and there were a few. I think we're kinda there in the AI roll up right now where, you know, ourselves and Eud and Thrive and a few others, ABC, have embraced it. But I think most of the market is still pretty skeptical, you know, similar to kind of the crypto evolution and where Bitcoin and stablecoins are today, you see very few people who say, hey. There's not value there. It's not interesting. I think that'll be us in a few years too. So it's been really fun, again, being on what I think is, like, a journey that will most definitely be proven true.