Riding Unicorns: Venture Capital | Entrepreneurship | Technology
00:18:13 · Hector Mason, Shah Ramezani
[00:18:13] S2: Yeah. So so risk for one person is not the same as it is for another, and it depends on, you know, what your fears are, what you're trying to protect against, how you experience pain from different things. I wonder, in your version of risk, has your approach ever backfired? When have [00:18:28] S1: you thought, fuck. I wish [00:18:29] S2: I didn't do that. Wish I didn't tell you that. And and so how... And where you've had to endure pain as a result of your decisions.
00:18:36 · Shah Ramezani
[00:18:36] S1: I look at it as bets. Let's say you go to a casino. The odds are you put black and white, I don't know, 48% terrible odds. Right? But in real life, you have sometimes these odds where the downside is limited. Let's say it's $10 or something or $20, but then the outcome is like, I don't know, 100,000,000. So that's the great thing about the real world is like it's just odds. Of course, you might be wrong and you lose 20 ks, but as long as you think the odds were in your favor by a massive money, you should take them. That's how I think about it. It's the same thing with investing. I like these companies that limit the downside, only upside because there is a bit of a buffer where it doesn't go. So you just float on it and then it maybe captures a vape or it doesn't, but it doesn't go. But the worst are like huge downside, then then you're out of business. You know, in the real world, the odds are not the way it works in the casino or like sports betting where it's a bit all arbitraged out. There is a lot of arbitrages. And the same thing I... When I bet on stablecoin, I found that a huge arbitrage. There was info... This information doesn't flow fast enough. People don't know. We don't have the time to look at certain industries. But as a founder in that industry, I knew there's only a handful of people who actually know this kind of information, and there is outsized returns. So I think you have to make sure that, first of all, you identify those. Are they exactly as you imagine? Are you biased something? And then you just make sure that that's right, and then you go for And then you... But you do five different bets like that. And then one of them will take off. And then the other one is also like, some don't take off, but doesn't mean that you should not give up on them. Sometimes you have to repackage them. You have to try it again. I'm a big fan of not killing ideas too early. Like, you have to also trust your instinct intuition because sometimes I've seen things take off. It's just a pure marketing and messaging perspective. The product is right, but the marketing, the PR, the landing, they hope everything was wrong. That's why it didn't take off. People didn't get it. So, yeah, that's kind of also part of it.
00:20:13 · James Pringle
[00:20:13] S0: Yeah. And, Shah, you you strike me as someone with strong opinions. And I mean that as a compliment. So apart from your insight into the stablecoin market, do you have any other strong opinions about the fintech industry that you're in and where it might be going?
00:20:30 · Shah Ramezani
[00:20:30] S1: I think, obviously, AI is changing everything upside down. I think some fintech players will be able to capture that really well because they understand what they can... Like, I think, basically, in the age of AI, proprietary data is everything. If you have proprietary data, you are winning. So let's say if you're on Stripe, you have Stripe link and, I don't know, like a couple of 100,000,000 link users, KYC, and everyone has to use your platform to be able to power platforms like Muse or Cloud, and that's huge. That's amazing. I think it's cool. Same for Revolut. They have 100,000,000 their own people KYC and they have provided data on compliance risk. So the people who can basically mobilize that and actually constantly nurture that, they're going to win. Then there are companies like Adyen who are purely infrastructure companies. And I think that's more like commoditized. It's like you you compete with the same people and, like, what what I'm gonna switch because software is so cheap, switching becomes easier. Switching costs gonna go lower. So people are like, we're like, I'm gonna switch quickly now to this one. I think fintech actually is a bit protected because you have regulatory stuff. But, again, you have to play smart. I think you if play smart, you can make a killing. You can grow very fast. I think Stripe has done a phenomenal job. Sadly, a lot of the other payment companies haven't, but it's just because as of the nature of them being in San Francisco and being with all the AI guys and understanding, they always see like everything from a year one year ahead of time because people come into their office and show them the latest like prototypes. So I think some companies will play it right. I think Revolut is obviously always on top of their game. You could see they never miss any any trends. Even on the stablecoin side, they've been one of the fastest fintechs to adopt that. On the crypto side, they were one of the fastest to adopt that despite all the regulatory challenges. And then also on the AI, they're doing a lot. Mean, they already have those things launched. So I think it's really adapt or die very quickly. You know, I always say in the world there is no such thing as a linear structure. You know, there's either everything is compounding or like it's a logarithmic or it's like also compounding downwards.
00:22:14 · Shah Ramezani, James Pringle
So initially, you might think not doing anything in AI is fine, but something like crashes next, you know, in two years, you're just gonna lose 30% of customer, like more employees. And then that kind of compound again, less funding, less resources, everything goes bad. And I think you have to react quickly. [00:22:28] S0: Awesome. One question before we move on to our two final questions. You've now been founder of a high growth company for a while. We've obviously talked about hiring. We've touched a little bit on sort of fundraising and story and narrative innovation, things like that. But if you had to give advice to a founder who's listening, who's let's say maybe they've raised one round or they've not raised a round yet, but they're just getting started. You have to give them one piece of advice. What would you say to them? [00:22:56] S1: Is that for the first round? [00:22:58] S0: Yeah. Maybe they're they're that early stage. So they've maybe maybe raised one round or maybe not raised yet, but [00:23:04] S1: they're they're just kind of [00:23:05] S0: at the infancy of their business.
00:23:07 · Shah Ramezani
[00:23:07] S1: I would say number one, obviously, don't pay yesterday. Mean, it depends how ambitious you are, but, like, you do the same amount of work, so you might as well think big, you know, because it's easier when you think big because you get better talent, better capital. If you think small, everything is small. Then number two, I would say the first people you hire are missionaries, loyal people like you need that because you're going to move around very fast. The last thing you need is these high executives who are like, hey, you know, like I have these opportunities. You need the early guys who are the misfits, the crazy ones who just join you on a journey. And then, I think just go on. And I think there is a lot of opportunities all the time. So you just have to be really like whatever you are convinced about, like just go full on, trust your instincts. I think the early days I was always a bit like shy about trusting my instinct, but the more I started to trust my instinct, the better things became. And then lastly, there is a lot of things you worry about all the time. You can worry about them, but don't let them loop in your head because it just makes the experience worse. Just deal with them. Be able to shut down your brain in the evening. Just like, no, no, think about it. I think that makes the whole experience better. At the end, you know, we we don't need much to be happy. Like, we need, a kind of a roof and some food. Everything I've got worried about always got figured out. But the experience that I had that to kind of like paranoidly constantly thinking about it, like naked, it was like that was unnecessary. I could have just done it without that.