Uncapped with Jack Altman
· Eric Vishria, Jack Altman, Peter Fenton
[00:00:00] S3: That responsibility, you just feel it. Not everyone feels that, which is fine, but— [00:00:00] S0: Totally. Also, I think if you’re walking in and it’s equal from the beginning, a bunch is given to you at the start. You’re like, “I gotta pay this off to somebody. The people who set me up from the beginning, I can’t really pay them back anymore.” So I can see why you’d be like, “I gotta make sure I give enough before I go”, even though you’re, in a weird way, paying back prior generations. That makes sense. [00:00:00] S2: Rooted in that as well, Eric says responsibility and I think he feels it and I respect that. I think the founders gave us permission to basically not take it too seriously. [00:00:00] S3: Yeah, they did. [00:00:00] S2: They said, “Listen, come on. There’s a group of you. No one’s going to be around in a million years.” [00:00:00] S0: It doesn’t have to be so heavy.
· Jack Altman, Peter Fenton
[00:00:00] S0: It doesn’t have to be so heavy. [00:00:00] S2: “Everything’s ephemeral.” So what you want is a tight-knit group of people at maximum potential manifestation. The energy, the joy. The heaviness of “Oh, we’re going to have to maintain this relic and wheel it out. The old tablets in the back about what the founders said…” None of that bullshit. This is a day-to-day thing. By the way, forgive me. We’re in an entrepreneurial environment where when somebody has a legacy, we want to destroy it. We’re in the business of creative destruction, not permanence and enduring. Forgive me. Our startups bubble up from nothing, and we stay true to that. I think the firm’s premise is that we should have our own form of creative destruction. There’s no legacy or claim to it at Benchmark. It’s the immediacy and present moment that we deliver. Everything else is secondary.
· Jack Altman
[00:00:00] S0: One of the things you just said, I hope is okay for me to press on. I’ve wanted you guys to talk about this. I know each of you individually and I know you all are founder friendly. It’s very easy for people in a competitive venture landscape to poke at one historical example that everybody else has done. If you’re just loud, you can poke at people. I would say you’re not loud externally and you have a mindset of “we’re going to let our actions speak.” But I’ve wanted you guys to speak because I know you’re very founder friendly. I’ve talked to founders you work with and all of that. So I’m actually curious to hear your thoughts. You’ve seen some of this stuff. Is it important for you to talk about… It’s what you just said. There’s a thing and then you have an immune reaction to it and the firm updates? How do you process all of that?
· Peter Fenton
[00:00:00] S2: Humans are storytelling animals. Every firm has their story, and depending on the situation and the motivations of the counterparty, you accentuate certain parts of a firm’s history. The ethic of the firm—and I think this is borne out even in our worst moments—is that the company must come first. We’re not more important than the company. Nobody’s more important than the company. It’s the initiative, the collective premise of an entity that’s bigger than one individual. There are moments in the past—and I’ve been around through the generations—where it used to be the standard model that at some point you’d ask, “When are you going to get a real management team?” That sort of faded to, “Well, perhaps we can go the distance. You have the Steve Jobs narrative, which raises the question of what crimes were committed against this notion of general management versus the founder mode reality that we all support. The part that’s most relevant, and this is what happens every day here, is that we view our job—I do personally, and this has been borne out in the references—as making the founders the best version of themselves. Like any relationship, if it’s simply sycophantic and enabling and codependent, we make them worse. If it’s harsh and judgmental or absent, we make them worse. So one of the things you need to figure out in references is, what questions should you ask? If you’re going to engage with any great firm, you want to do references. First it’s a phone call but I actually think you could go a level deeper and ask, “How does this person make you a better entrepreneur? How have they unlocked your potential?” What we care about more than happiness is flourishing. In our companies, I think what’s borne out in the work we’ve done is that if I work with that group, I’m going to be a better version. I’m not going to be living in fear, because then you’re not a better version of yourself. Nor am I going to be getting… Forgive me, what happens in our job right now, I’m struck by the number of boards where I see a relationship that’s sycophantic, where people are afraid to pursue truth because they don’t want to hurt anyone’s feelings. Worse, I think the greatest crime that occurs in many boards is that somebody says something behind the entrepreneur’s back that they won’t say to their face.
· Peter Fenton, Jack Altman
One of the things I think is a deep ethic at Benchmark is that we are transparent. We’re going to say it to your face. We may not say it behind your back. We’re not going to be in a situation where it’s like, “here’s what I really thought about the board meeting….” This idea of congruence, which is a key term in psychotherapy, is that you really want to know that you can trust your partner, that they’re not putting on a mask because they want you to feel a certain way. They’re being real. [00:00:00] S0: By the way, this also goes to your point about not putting more dollars into the company. If you almost structurally can’t put more dollars into the company, then you just want to tell them the truth. [00:00:00] S2: You’re truth-seeking. [00:00:00] S0: If you’re hoping to win the next round, you don’t want to piss them off because next month you might be writing a term sheet. There’s the references piece. There’s the “I want to put more money into this company” thing. There’s just the “I don’t want to fight” type of stuff. I do think it leads to that. I think the best version of being founder friendly is not comfort all the time, obviously.
· Jack Altman, Ev Randle
[00:00:00] S0: If you’re hoping to win the next round, you don’t want to piss them off because next month you might be writing a term sheet. There’s the references piece. There’s the “I want to put more money into this company” thing. There’s just the “I don’t want to fight” type of stuff. I do think it leads to that. I think the best version of being founder friendly is not comfort all the time, obviously. [00:00:00] S4: There was a recent example of this. I recently led an investment that’s still unannounced. We actually had the founders over for dinner in the dining room where we’ll have lunch in about an hour. During the dinner they showed a demo. We were going through their commercial strategy and we gave them a lot of very direct feedback. A lot of it was constructive. It was a really productive conversation. But not every founder responds super well to that. So I called the founder afterwards and said, “How was that for you? How would you respond to that?” In that call he said, “You as a team are going to make us better founders. I can tell that right away.” Because of that, he really wanted to work together, because it wasn’t just going to be slaps on the back and congratulations. It was going to be a relationship where we really pushed both the founders and the whole team to be a better version of themselves. [00:00:00] S0: Does it feel structurally different to you than KP and Founders Fund in any way?