The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
01:05:15 · Jack Altman, Rory O'Driscoll, Jason Lemkin, Harry Stebbings
[01:05:15] S1: I love this. [01:05:15] S0: Yeah. You'll you'll... Jack, you'll note the complex analysis he did here. He looked at the stock chart. So it was when he filed in. Exactly. [01:05:22] S2: 30% of your public cash you're putting in? [01:05:24] S1: 30. I I would I would do a full 30. [01:05:26] S2: 30% of your liquid assets. 30% of your liquid assets. [01:05:29] S3: Yeah. You've got your [01:05:30] S0: old fund now. Third in instinct, a third in Jave, and a third in new bank, man. You you you you... You're in. You're one third liquid. You're golden. [01:05:37] S3: Traded. Done. Thank you very much. I'm out now. Thank you so much for coming, Jack. [01:05:42] S1: Yeah. Exactly, man. Thank you. [01:05:43] S2: I don't know too much. Honestly, I don't know too much about this deal. I can't add too much value. But the one thing I will say in general is it seems to me they're buying time, right? They're buying time to instantly have the British market. They're not buying just the revenue, right, of the customers. They're saving themselves time. And I think as venture investors, those are great for our portfolio companies because sometimes a company you have, it's not even growing that crazily, but it has a position and someone will pay up to save time. We need that for venture to work too, It's the only way people are going buy the A minus, B plus assets is to save time. So thank you. And I have a few others that can save you time, that can save you years of time. I got them. And here's a deck.
01:06:24 · Rory O'Driscoll, Harry Stebbings
[01:06:24] S0: I also think one other comment on the Monza side is that the whole you know, boardroom drama, you know, originally founder Tom had retired, they put in the CEO, then the chairman swapped out the CEO, and then the investors were pissed, and then they reversed that, and then the chairman's retired. It's gonna sound really, it's that UK chairman plus CEO role I've seen, which makes intuitive sense for well governed public boring companies, but in my view makes absolutely no sense for venture backed deals. And you can tell what happened here under the surface, which is all the VCs were like, you did what? You know, we weren't backing the chairman, we were backing the CEO and you changed him. So I think there's a lot of board instability. And when you have that, especially when you've taken out the founder and you have a ton of board instability, and then suddenly someone says, I'll buy you out, you're like, hit the bid and the pain. [01:07:11] S3: Well, I think everyone was thrilled bluntly when TS came in, just to be super clear. With the greatest of respects, the company turned around when TS came in. And then when TS got taken out [01:07:20] S0: That's my point. [01:07:21] S3: Oh, yeah. Mother of god. Why the fuck did you take the guy who was competent out of this business?
01:07:21 · Harry Stebbings, Rory O'Driscoll
[01:07:21] S3: Oh, yeah. Mother of god. Why the fuck did you take the guy who was competent out of this business? [01:07:26] S0: No. You're exactly right. Tom had done the founder thing. The company was doing a 100,000,000, losing a 100,000,000. They hired this guy. He kills it. And then they replaced him in the last few months. And it's like, And I think all the venture investors are going, we didn't sign up to have a nonexec chairman replace the guy we backed. [01:07:41] S3: Totally. Guys, there's two different spectrums here in terms of venture. Bessemer raised a fresh $5,750,000,000 to the point of you only need one. Well, they think you need near close to six, but a very, very modest $1,750,000,000 seed fund, Jason. So seed isn't for suckers when you're when you're when you're doing about 40,000,000 a year in fees. It ain't for suckers, baby. And then on the flip side, you've got NFX now just investing GP capital, not taking a new LP capital in new funds. So two different ends of
01:07:41 · Harry Stebbings, Jason Lemkin
[01:07:41] S3: Totally. Guys, there's two different spectrums here in terms of venture. Bessemer raised a fresh $5,750,000,000 to the point of you only need one. Well, they think you need near close to six, but a very, very modest $1,750,000,000 seed fund, Jason. So seed isn't for suckers when you're when you're when you're doing about 40,000,000 a year in fees. It ain't for suckers, baby. And then on the flip side, you've got NFX now just investing GP capital, not taking a new LP capital in new funds. So two different ends of [01:08:17] S2: the spectrum there. Well, Bessemer thing is just what Jack's talked about at the beginning, the learnings of benchmark and going big on growth early. I think it's probably the same story. I mean, Bessemer, they weren't menlo into Anthropic, but that was a great one. Right? The growth team accelerated. They blew up the whole teams there, Samir and the whole team. It's been a win. So of course you put more money into it, right? I think they said the seed early was still mostly growth. But even there to Jack's point, it's 2026. Imagine a seed around is 30,000,000. How many can you do with reserves in a 1,750,000,000 fund if you can't count on recycling? 30? With one to one reserves? You can't even... You need... Even a billion starts to sound small for seed funds if you believe 30,000,000 is a seed and it... You know, that that barely gets you TechCrunch article. So the math sounds right even if the returns may, you know, maybe some work.
01:08:17 · Jason Lemkin, Harry Stebbings, Jack Altman
[01:08:17] S2: the spectrum there. Well, Bessemer thing is just what Jack's talked about at the beginning, the learnings of benchmark and going big on growth early. I think it's probably the same story. I mean, Bessemer, they weren't menlo into Anthropic, but that was a great one. Right? The growth team accelerated. They blew up the whole teams there, Samir and the whole team. It's been a win. So of course you put more money into it, right? I think they said the seed early was still mostly growth. But even there to Jack's point, it's 2026. Imagine a seed around is 30,000,000. How many can you do with reserves in a 1,750,000,000 fund if you can't count on recycling? 30? With one to one reserves? You can't even... You need... Even a billion starts to sound small for seed funds if you believe 30,000,000 is a seed and it... You know, that that barely gets you TechCrunch article. So the math sounds right even if the returns may, you know, maybe some work. [01:09:02] S3: That's why Rory's a pre seed investor today with his 900. Friends and family round, Rory's the first shackles in. [01:09:09] S1: Yeah. That's me. Exactly. [01:09:10] S3: And then and then NFX shutting shop to externals?
01:09:10 · Harry Stebbings, Jack Altman
[01:09:10] S3: And then and then NFX shutting shop to externals? [01:09:14] S1: I mean, I I agree on the... Like, both of these moves make sense. Like, you know, for Bessemer, it is the market around you, and they've got, you know, a long history and tons of LP trust. And if you wanna play the game, why not just go bigger and play the game? And then on the NFX side, you know, the homebrew guys, I think, did this before, and that works out really wonderfully. And I think it it probably changes the texture of how the game feels. And I think people also really care about that. When you're not managing external capital, you get to do things without any explanation to anybody. And I think that, you know, there... There's probably some ways in which that lets you, you know, freeze up your activities. But I also think some people just get to a place where they prefer it, and they wanna say, you know what? This ownership stuff, I don't care. I wanna put a 100 k into, you know, into JEV or something like that. And that's hard to defend out of a seed fund. But if you're investing your own capital, it lets you do it. So I I do also think back to the prior point, I think money is a big driver, but I think there are also non financial drivers for a lot of these things. So makes sense.