Over the last three years I've worked with over a dozen early stage companies. This year I made a goal to launch a fund. I've been investing time understanding the landscape of early stage investing (which is different from early stage consulting). I've joined the On Deck Angels Fellowship, speaking with a number of past investors, and founders and operators who have sold companies.
For context Reid (alongside Zynga's Mark Pincus) and Chamath are in the business of SPACs. I'll leave the notes about SPACs out for the moment and just focus on the nuggets related to early stage investing.
These notes are from a recent call with I had with a small group of founders, operators, and investors and the two of them.
- “Here’s a simple framework I use to manage risk. Imagine a barbell - weights at either end with a thin bar in the middle. In my opinion, risk is best managed in this way.” - Chamath Palihapitiya (tweet)
- "People can be flawed and still be backable." - Reid Hoffman
- Useful indicator of future:
- Where are the smartest people “dabbling”?
- "Don't try to predict the future… focus on teams rather than future bets." - Ashby Monk, Stanford’s Global Projects Center
- Reid indicated that a founder needs to respect the partnership with you (as an angel). Once there is a risk, you should walk away. - Jackson Gates, Manresa Ventures
- Maybe the future of funding/entrepreneurship looks way more like startup studios, super angels with lower ownership and earlier IPOs (vs traditional funds and many private rounds). - Vincenzo Iozzo, CrowdStrike
- Solo GPs will have more alpha because they don't have to defend their decisions in the same way. - Jack Altman, Lattice
- Per Chamath, VCs are now managing risk and are a very predictable group of people that don’t want to look bad. So they just copy each other. It becomes hard to swim upstream because of groupthink and lack of courage whereas solo GPs can generate alpha because they don’t have to conform. - Jackson Gates, Manresa Ventures
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