The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:36:30 · Rory O'Driscoll, Harry Stebbings
[00:36:30] S0: And I I... You know? And I want to believe in it because we've made some magnificent bets on companies like that. But I do agree that the table at the moment is 80% the fast action table and 20% the slow action, which makes sense because in 2022, there was a discontinuity and everything before that became obsolete. So by definition, anything at this stage four years in is fast action by definition because it started in '22. [00:36:56] S3: Also, you wanna go for that model, your numbers will be crap for quite a long time. And we always forget that we're in an opportunity cost game where people can put money into your Sarah Gwos and your benchmarks of the world. And while you guys post numbers that are just never before seen... I was messaging Chatham last night, Jack, being like, oh god. Just stop. The latest fund is just ridiculous. We're an opportunity cost. You can be in those... Well, you can't be in those funds, but, you know, you can try and be in those funds. And so trying to be smart where no one else is. [00:37:26] S0: That's a lot agreed. It's about, Yeah. The the giant sucking sat... The the... Basically, money is a signal, price is a signal, and price is sending a signal, everybody go right here. And everyone will go right here because that's the job of price. Mister Hayek would be happy.
00:37:26 · Rory O'Driscoll, Jason Lemkin
[00:37:26] S0: That's a lot agreed. It's about, Yeah. The the giant sucking sat... The the... Basically, money is a signal, price is a signal, and price is sending a signal, everybody go right here. And everyone will go right here because that's the job of price. Mister Hayek would be happy. [00:37:40] S2: The problem with the Quiet Compounder to Jack's point, in my view, as someone who's pitched Quiet Compounding since 2012, is they're just not stable. You have to build so much more software so much more quickly. Right? Jack and I are both on the board of owner, is, you know, a rocket ship north of $100,000,000 revenue. But look how much effing software they have to build this year, right? How many folks can pull that off? How many folks can raise the capital? Like, and even if you have 10 times more competitors, right? I have another company at 100,000,000 They put up a competitor slide at last board meeting. I never heard of eight or nine of the ones. I thought we had one competitor. Turns out we have nine, right, at $100,000,000 So it's not that I don't want to believe. Forget about the fact that it's harder to raise LP capital, is Harry's point. This instability is something that I think people under reflect on. Right? That's the problem. It's just... It's so unstable that it it... It's just... It's so undurable.
00:37:40 · Jason Lemkin, Rory O'Driscoll
[00:37:40] S2: The problem with the Quiet Compounder to Jack's point, in my view, as someone who's pitched Quiet Compounding since 2012, is they're just not stable. You have to build so much more software so much more quickly. Right? Jack and I are both on the board of owner, is, you know, a rocket ship north of $100,000,000 revenue. But look how much effing software they have to build this year, right? How many folks can pull that off? How many folks can raise the capital? Like, and even if you have 10 times more competitors, right? I have another company at 100,000,000 They put up a competitor slide at last board meeting. I never heard of eight or nine of the ones. I thought we had one competitor. Turns out we have nine, right, at $100,000,000 So it's not that I don't want to believe. Forget about the fact that it's harder to raise LP capital, is Harry's point. This instability is something that I think people under reflect on. Right? That's the problem. It's just... It's so unstable that it it... It's just... It's so undurable. [00:38:29] S0: Put another way. Yeah. If you're making a compounding play, the quid pro quo should be low risk. And if the world is such that the tech environment is changing so much that you get the compounding, not the hyper growth, but you get the same level of risk, that by definition is a suboptimal game.
00:38:29 · Rory O'Driscoll, Jack Altman, Harry Stebbings
[00:38:29] S0: Put another way. Yeah. If you're making a compounding play, the quid pro quo should be low risk. And if the world is such that the tech environment is changing so much that you get the compounding, not the hyper growth, but you get the same level of risk, that by definition is a suboptimal game. [00:38:45] S1: Yes. And sort of to me, one of the most dominant reasons why I do agree with Harry here is it's just like, it's a talent war in the most insane way right now. It's just the... These opportunities are just too enticing for great people. [00:38:57] S0: Which is a perfect segue. Perfect segue, Harry. Come on. Figure it out. [00:39:02] S3: Are you suggesting that Jack teed me up there, Rory, for a slant [00:39:05] S1: on time? But you missing it. Harry, I didn't see it either. And I also try to be a podcaster, so I... That was a hard one. [00:39:10] S3: Jack, I think we're just a bit slower than Rory. Okay? Professor O'Driscoll has... He's very sharp. He's very sharp.
00:39:10 · Harry Stebbings, Rory O'Driscoll
[00:39:10] S3: Jack, I think we're just a bit slower than Rory. Okay? Professor O'Driscoll has... He's very sharp. He's very sharp. [00:39:16] S0: Stop. Stop. Stop. Stop. Stop the bullshit. We should just... For the viewers, we... Our listeners, we should just say, look. What happened here is the CEO, the chief executive officer of a standalone independent public company, MongoDB, a very successful $20,000,000,000 market cap public company, who just took the job less than nine months ago, got an offer from Muse, hit the bid, moved over to Facebook slash Meta to run their enterprise division, and Mongo stopped, dropped 20% in one day, and then Dev stepped back in, who'd been the... Not the founder, but the CEO from a long last time and and is now back running it. But the point... To Jack's point was the money can exert such a powerful influence. It was powerful enough to persuade this guy to quit the top job, go work at Facebook, because I assumed the offer was just earth shatteringly compelling. Right. And that's your point, Jack, is that when you have the hot stock, when you have the momentum, you can make people offers that just allow you to take whatever talent you want. And this is an example of that. [00:40:12] S3: Do you think it is money? I don't know. When you're earning 52... Maybe I I don't earn $52,000,000 a year. But I imagine if you're earning $52,000,000 a year, earning $120,000,000 a year, that's nice. But I think for him, when he looks at this, he's like, holy shit. I have the chance to impact far greater. Nah.
00:40:12 · Harry Stebbings, Jason Lemkin, Rory O'Driscoll
[00:40:12] S3: Do you think it is money? I don't know. When you're earning 52... Maybe I I don't earn $52,000,000 a year. But I imagine if you're earning $52,000,000 a year, earning $120,000,000 a year, that's nice. But I think for him, when he looks at this, he's like, holy shit. I have the chance to impact far greater. Nah. [00:40:28] S2: I think it was a $52,000,000 package, and he was offered a $500,000,000 package by Zuck to run enterprise. He... 10 x is easy. What does it take? 520,000,000 then done. Right? No one wants to step down from CEO to be a chief executive enterprise products and tokens officer. [00:40:45] S3: You think he's paid $500,000,000 a year? [00:40:47] S0: Yeah. It's 10 x. [00:40:47] S3: It's it's 10 x. I'm I'm hitting the bed. Hit the [00:40:50] S0: bed. I'm just kind of agreeing with Jason because you were gonna go down some kind of mongos, not exciting, and meta enterprise would be exciting. I think that's true. But conversely, no one who's been a CEO goes back to not being a CEO. It's just it's just so damn hard. Right? So the answer is it must have been just a compelling offer. [00:41:09] S3: I mean, dude, we saw we saw Nick Clegg, who was deputy prime minister, go and work as Mark Zuckerberg's. I mean, [00:41:15] S0: I mean, yes. [00:41:16] S3: So like, you know, that's... [00:41:18] S0: I'm a... Yes. I'm trying... Yes. Yeah. Be careful what you say. I'm just trying to not be mean about Nick Clegg or England or David Cameron our Mark Zuckerberg, and it's just too hard, so I'm just gonna let it slide.