Traction Podcast
00:06:51 · Roy Luo
[00:06:51] S1: Totally. So TCV was a great place to to get started for me. I think there are some really smart investors and smart people there, and I learned so much during my time there. And they're an older firm. They were started in '95, and I think they just had a lot of institutional knowledge that they were able to impart upon all the folks that have gone through that system. And through that, you learn a lot not only about how to work with founders and what makes a good investment and how to invest in technology, but you also learn a lot about yourself. And what I quickly learned was what does the world really need when it comes to partners in terms of building new disruptive technology businesses? And I had met people at Iconiq during my time at TCV and really discovered that I think there are a lot of smart people, great people, great partners out there in this world, but the platform that Iconiq has been able to build is very special, very unique. And to be able to have the opportunity to join that team and then create this and extend it to the technology landscape is a very special and privileged position to be in that I'm very grateful for every day. Our community, we have access and ecosystem of really special people across all walks of life. And when you think about what we can do for our portfolio companies, I humbly say I'm a conduit as a partner to be able to bring the power of our community to other founders and leaders of businesses. And when you can do that with the top leaders of Fortune 500 businesses or places like Microsoft or retail businesses like Nike or Adidas, that's pretty cool, and it's pretty unique. And to be able to be a part of that, even a small part of that, I think is a huge privilege. And so that was a big driver for me to be able to join this community, join this platform. I love the people that I work with. And we're hopefully continuing to do what we do and invest in some of the best businesses out there.
00:08:46 · Lobo, Roy Luo
[00:08:46] S2: And and the kind of funds that TCV and even Iconiq are, you guys are not like the typical Silicon Valley venture early stage investors. You're not doing pre seed. You're coming at what? Like a series a or like more maybe series b growth capital. Right? [00:09:02] S1: Yeah. The word growth is a little odd, I would say. And so I know we have the name as Iconiq Growth, but we'll do anything as early as Series A, Series B, a lot of Series As and Bs. Our funds are quite large, and we can go all the way up to pre IPO and IPO rounds as well. And we actually have a great track record of being supportive public market shareholders as well, and we bought in the open market in businesses to support them in the public as well. The scope, I would say, is unusual in terms of how wide we go in terms of stage and maturity of business. And so the way we maintain focus is we focus at that top thin layer of just best of breed businesses, best leaders, best products in strategic categories. You're right. We don't necessarily do seed investments. We're definitely looking for best founders with product market fit, but that can still extend into the earliest of days in businesses. [00:09:54] S2: Your thesis specifically has been fintech. Is that because of your Goldman Sachs and real estate investing background, or how did that come about?
00:09:54 · Lobo, Roy Luo
[00:09:54] S2: Your thesis specifically has been fintech. Is that because of your Goldman Sachs and real estate investing background, or how did that come about? [00:10:04] S1: Sort of. When I was still at Goldman, this is gonna sound silly, but I had this idea of, like, effectively what was Venmo before Venmo had really started taking traction. And obviously, it's this huge big thing, and I think everyone in the world had some idea around Venmo. But I just naturally had an idea around how commerce needs to be digitalized. And over the past decade plus, that obviously has happened in space across many different forms, but that's always been a driver for me. And in particular, I think financial services or financial products are literally everywhere you look. And when you think about different end markets, end verticals, we could talk a little bit about how in vertical software in particular, all roads lead to financial services products. Right? There's so many vertical software businesses out there that have embedded finance as part of their offering at some part of their journey. And I think it's true that ultimately financial products are everywhere you look, and technology is a great way to bring forth financial products in a more cost effective, efficient way. And that changes how transactions and commerce work all over the world. [00:11:16] S2: I did a great podcast a couple years ago with Matt Harris from Bain, and it was every company is a fintech company.
00:11:16 · Lobo, Roy Luo
[00:11:16] S2: I did a great podcast a couple years ago with Matt Harris from Bain, and it was every company is a fintech company. [00:11:23] S1: Yeah. A little bit like that. They're two big figures. Every company is a fintech company, and software is eating of the world, and I believe in those two axioms. And I'd add that
00:11:32 · Lobo
[00:11:32] S2: every company is an AI company too. Right? Because yesterday's innovation always becomes tomorrow's commodity. And if you look at it in the technological shift from on prem to SaaS, and then within SaaS, there was a bunch of things that happened within the cloud, right, like mobile and social and fintech. And now I think by the end of next year, if your product is not an AI product, I think you're a laggard. I think we're heading into the world where AI is doing the work autonomously, and there's enough data points to prove to that. For example, agentic wrappers on LLMs are one and a half, two times more accurate and faster than the LLMs alone. And if companies are not leveraging these technologies to make the outcome better, faster, cheaper for their customers, I think they get left behind. And we're also, I think, interestingly, feel we're heading in a world where if AI is doing the work autonomously, then why do you need a UI to do inputs? Like, what does the UI look like? It's a it's a very interesting time. Wow. And fintech is a core part of it because, like you said, payments. And the more data you collect from somebody and the more data across their system you collect, like, from... Maybe it could be product data stitched with financial data. You have the opportunity to offer products... Financial products lending being a big part of it. I'd boast... We started with r and d tax credits, and we collected so much data from a company's technical and financial systems that we then did a 100,000,000 warehouse facility to lending. We securitized our tax credits to lend. Right? So there's a lot of these interesting opportunities for businesses. Now you've invested outside of fintech too. Right? You've done Figma and Canva. How did that come about?
00:13:27 · Roy Luo
[00:13:27] S1: So ultimately, those two axioms we talked about, ultimately, I'm a big proponent of how software transforms workflows and drives impact in the communities in which they serve. And so while Canva and Figma not necessarily are providing financial products, the idea around any fintech that I've ever made and a lot of the fintechs out there that I'm really excited by, it's really how software technology and now AI is enabling them to deliver financial services products in a really cost effective, efficient, and disruptive way. And so I would say Canva and Figma are not necessarily the ones that are doing the financial products themselves, but we can talk at length about any of the other businesses that we work with, and it's software led. I think you did an interview with some of the folks at Ramp before, but it's an amazing, call it, fintech company, but really what makes it special are the products that they've built, and those are software products. And embedded in it is obviously a financial services offering, but when you talk to customers and what got me so excited about Eric and Karim and their leadership and what they built there, it's really about the products that they built and the love from customers that they had around the products that they built.