Venture is in its growthmaxxing era

0:05Today on Great Chat, we're talking about looks maxing and growth maxing. We promise it'll make sense. I'm Ashley, and this week I'm joined by Helen and Angela. Great chat is brought to you by Mercury, radically different banking loved by over 300 ,000 entrepreneurs. We use Mercury to run this podcast and love recommending it to other founders and fund managers. It's free to get started. Try it for yourself. Visit mercury.com to learn more and apply online in minutes. Hey, guys. Hey, guys. Happy Lunar New Year and the year of the fire horse to everyone. I am like all, I'm all for it. I've actually, I never pay attention to these things, but I've done some reading on the year of the fire horse and extrapolated what it might mean for my life.

0:48Thanks to chat GPT's help. And I'm ready. Let's go. I think my favorite post that I've seen is Ivanka Trump saying like, happy year of the horse. And it's just like four photos of her looking up in a distance in white. And her face looks totally different. But like not even a cut, like not red or like a colorful color, which is generally what you wear to celebrate Lunar New Year. But I love the inclusion, but it made me laugh a little bit. I just laughed because the first comment I saw was, we know you're the president's granddaughter, but just because... And I was like, wait, she's his daughter.

1:23But that was perfect. I don't know why. Yeah, thanks, Ivanka. I mean, I also really flex my AI skills. I used ChatGPT to make an AI-generated photo of our family dressed in festive colors so I didn't have to go through the hassle of changing my kids. I didn't even know that was AI-generated. Yeah, right. Impressive. Very impressive. Yeah, it went through a few iterations, but then our faces got more and more distorted the more I tried to change the outfits, and then I had to go back. But it's been a great news cycle. And I don't know if you guys saw the video of the Unitree robots performing at the spring gala, but that was pretty awesome as well.

2:02I feel like we had very different reactions to that. I immediately went to this is terrifying. And why with small children in the house would be terrified to have one of these as like somebody who's, as Max said, emptying my dishwasher and like taking out the trash. It's like, sure. But then where do they sleep at night? In the closet locked. Right. Well, we talked about this before. But Angela, you're very stoked on these. I mean, I am other than the fact that I do have this non-logical fear that if I had one in my house, I'd wake up at night and, you know, they would just be standing over me watching.

2:39It seems totally logical. You know, it seems completely logical. Not to get really dark, but like one of these things, killing like a pet or a child would be such a bigger thing than like the Tesla crash. Right. Like it's just so much more visceral. And so I, you know, let's, let's, let's hope that's not possible, but, um, I'm, I'm on the fence. I don't like doing the dishes. So maybe I'll get one of those, like, you know, less humanoid versions. Yeah. The soft, the rat, this is what I said, like the form factor could be like a, like a soft, you know, more, um, grimace from McDonald's shaped robot.

3:22I would be down for that versus these guys who were like doing full choreography and like have a black belt in every, you know, type of my martial arts. So yeah, I'm all for having more help around the house, but it was a little scary for me. Although wait, Angela, you wanted them to be, what was the Backstreet Boys comment? Yes. I'm just, I'm just manifesting Unitree founders of Unitree, whoever of Unitree that listens to this podcast, please have your robots perform the Backstreet Boys, everybody dance as part of their show at the Sphere, because right now it's just a video with lasers of robots dancing, but it could be a whole stage full of unitary robots.

3:58And that would be a very viral moment. So that manifesting that into the universe. I feel like recently, this whole looks maxing thing has like, sort of jumped into more mainstream discourse for better or worse. And And I know it's been around for a while and I think we catch fringe pieces of it. But like now I feel like you have to be extremely online and get every reference to get some of these like VC jokes on Twitter. Helen, what is it that you sent? I need to find it. Like I understood zero words out of the phrase. It was clever and funny. In fact, I typed into Claude like how I might open this podcast in a looks maxing bro voice.

4:42And it said, what's up? Quick looks maxing update before we get into it. soft max this morning, moisturizer, good lighting, strong podcast fundamentals. We are ascending. This is great chat. So basically it's like you talk like that and it's like mogging, frame mogging is like a thing. Like if a guy has like a bigger frame than another guy, then he's like frame mogging the smaller guy, but you can like substitute frame for anything. Am I getting that right? It's like incel speak, right? Like it's - Yeah, it originated in like incel culture. But then like I think they're saying that something with like the Zoomer generation, you know, during COVID was just extremely online and got very narcissistic.

5:26And, you know, created this whole subculture of looks maxing, which is basically like going to extreme lengths to, you know, become a Chad, which is like a, you know, good looking, good looking bro or something. And it's funny because I had seen this language start to crop up over the past couple of weeks. But like it somehow got into my feed of like normally like nerdy tech stuff. But it was like about this guy named Clavicular, who I guess is a streamer. And it was just I think people were sharing it because it's like the language was so absurd. But then it was over this past week that it jumped into like tech Twitter discourse.

6:06and the moment that brought these worlds together seems to have been the uh duarkesh and daario podcast interview because there is this one frame of the podcast where like duarkesh is like total chad mode he looks like so ripped he's got like the great profile like he looks like a chad and then daario's kind of like hunched over and like looks a little nerdy and so you know someone commented oh my goodness like rakesh totally frame mocked dario and then it feels like ever since like it has infiltrated vc twitter in a way that is like terrifying and i'm hoping it's like a short trend but it was very funny to see like see that over here that lingo like in a very like more like sort of subculture space and then make the leap into now every tech headline has like, you know, someone's putting it through the clod.

7:05Political candidates are using it in their campaigns now, too. So I think the fastest way to kill something is for like millennial women to be talking about it or like Donald Trump to be using it. We are doing our part, damn it. This is where it looks, Maxine dies. Yeah, yeah, exactly. we'll have to come up with a title for this podcast that that is our one and only nod to to this this particular trend pod maxing gesture maxing pod i still don't really know what looks maxing is and i was also like today's year old when i discovered that there are like only fan creators that have completely like ai-ified you know affects themselves so that the videos they're streaming are not of themselves yeah i don't know if you have you know any looks maxing is involved with aifi but like here's the thing angela you just asked what is looks maxing honestly it's like south korean uh plastic surgery that's been going on for like decades i think there's like this really insane thing that's like bone smashing where they take like a hammer and they like hit their cheekbones to make the bone grow back like more wow intense or something and i was like well yeah I think women have been like breaking their jaws to have like you know and then shaving down the jawbone and doing insane stuff like this for such a long time and now it's like getting a lot of attention because men are doing it so I don't really know what what will come of this but I think that a lot of it to me at least feels just like oh there are tiers of men and there are all these extreme lengths that that men are going through to frankly impress each other this sounds familiar like it feels like the convergence of a bunch of trends like during the pandemic everyone was suddenly on zoom all the time and some people became really appearance obsessed i remember being at glossier and like the pandemic was like a boon for beauty sales you would have thought it would have been the opposite and then there's like the incel culture and there was i forget which magazine did it but there was like a big magazine cover that got a ton of attention a couple of years ago that was all about the intersection of incel culture and plastic surgery and people going for these very chiseled jobs, very specific sort of ideal male look.

9:31And now I can understand how this has seeped into the sort of tech bro world because one theme I keep seeing in my feed is like, well, now that AI is better at thinking, the only thing to do is to get really hot. And of course, I said this. A lot of people are saying this. And so it's just kind of feels like, yep, like looks maxing is like at the center of all of these slightly disturbing, slightly disturbing trends. Guys, Margot Robbie and the Wuthering Heights press tour. I don't know if this is over your feed, but this is consumed 100 % of my social media feed. And she looks okay. Well, what about it is significant to you?

10:14She looks incredible. amazing the outfits the outfits yeah yeah yeah the like showmans with jacob the story you know like everything just no notes like 10 out of 10 do you think that it's now a requirement for like male and female um you know actors during the during the press tour to like spark rumors of there being like you know on set attraction and all because i feel like that went around too right so like what specifically caught your your uh eye on the on the press tour other than the outfits or was it just the outfits it was it was looks maxing to the extreme i think she looked i just felt the whole it was like very on theme the outfits were on theme the dynamic between her and her co-star you know mirrored the storyline of the movies and it was just this whole the production value and it made me think it's sort of like movies are so commoditized now the way you drum up interest is to create this whole ecosystem.

11:09And I wonder if we're not seeing similar echoes of that in tech with the personalities and product launches and then the way narratives are built that extend beyond just what that I bet so many more people like me have seen the press tour and have been engaged in that than we'll actually go see the movie. Oh my God. Can I try to make the like most absurd parallel of all time? That's literally what this is for. That's what this podcast is for. So like Jack Altman announced he's joining Benchmark today and it was like beautifully teed up. The press tour moment was that he had the entire Benchmark partnership on his podcast.

11:49Like what was it like a month ago or two months ago? And actually Alex Conrad from Upstarts joked like, is this the first ever like video job interview or whatever? So anyways, they like were drumming up some excitement for that moment. and there's like a little more theater around it. Well, I mean, maybe that's the requirement now because every announcement is like, you know, some big billion dollar number on Twitter and a thread and tagging a bunch of people. And, you know, there's like kind of, you have to kind of break through. And maybe now it's like the sort of theatrics around like the pre-release and then the story.

12:28And I love it. I love a big production. So this is entertaining. And we were wondering what was going to sort of, you know, replace the valuations and the, you know, sort of like really, you know, the like sort of cookie cutter announcements that we saw from 2025 that made everything start to look the same. So if, you know, I'd love to see a fund announcement or a Series B round with like a Margot Robbie style press tour with outfit changes of this caliber for sure. So yeah, I saw the Bloomberg article from Natasha that released performance data, I guess, on benchmark funds. And I think I saw some comments that were like, who is counting benchmark out?

13:13And I was trying to think about it. And it's like, were people counting them out? Was it just that they weren't like going the mega fund route? And it was it really felt like it was just like the founders fund boys doing the like anti Bill Gurley tweets, as usual. I don't know if anybody was actually counting them out. I think there was some skepticism. I think there was a lot of pushback after they did, was it Manus in China? So there was like the geopolitical debate that definitely certain founders fund partners leapt into headfirst. But also like Miles Grimshaw went to Thrive last year. There's been some like, they've made some strong hires recently, but I think there was some like, oh, no one leaves.

13:57Oh, and Sarah Tavel like stepped back. And so like, like no one leaves benchmark until you're ready to retire. And so I do think there was actually some uncertainty, but the performance data was amazing. They're like up at 10X from their 2020 fund, which a lot of people's 2020 funds might not be so good. So that's particularly impressive. And then exactly like 3x already from 2024. So, so yeah, I actually love this as a narrative violation to like, oh, you're either a tiny, tiny craft fund, or you're a mega fund, and there's no in between because benchmark is sort of living proof. That is not the case.

14:35And also, I feel like in the go direct every VC having a podcast or, you know, like a really noisy Twitter account, like, I feel like those guys have just kind of done their own thing. And yeah, that's great. More of that. Jack Altman. That's like, who said he would be continuing the podcast? You know, it's a media acquisition. There's no way that's not also like a brand in media play. I mean, I'm sure Jack is for sure. A fantastic investor, but yeah, but it's very authentic. It doesn't feel like, um, it doesn't feel like VC firm marketing, right. Which is, I think doesn't hit as well as something that it's like the cult of Jack's personality and his guests versus a benchmark initiative.

15:19Well, that feels like actually a perfect segue into the thing we wanted to talk about because it does feel like all of the headlines these days are about these like massive, massive growth rounds and, you know, like numbers that we've never seen before. And obviously, Helen, you and I play at like the very, very other end of the spectrum, like mostly pre-seed. Angela, I know you do a lot of different things, but you've at least like touched this world much more than we have, you know, given that you're a partner at SoftBank's Vision Fund. And so maybe just to summarize like what has changed, like it's really a story of concentration.

15:57The top 30 VC firms captured all, 75 % of all fundraising in 2024. And it's even more aggressive in 2025. The 10 largest BC funds collected 43 % of fundraising dollars. I mean, we're seeing this at the firm level when Andreessen Horowitz announced their new like$15 billion across funds. They bragged that it was 18 % of all venture dollars allocated in 2025. Thrive announced a$10 billion fund 10 this week, which is insane because their first fund was like$5 million and it wasn't that long ago. And then this is directly connected to what we're seeing on the company side. So a small number of companies like OpenAI, ScaleAI, Anthropic, Project Prometheus, XAI, they all raised over$5 billion in 2025.

16:46And those companies alone accounted for like 20 % of all venture capital spending in 2025. And I think given the headlines we've already seen this year around Anthropics massive raise, a$30 billion Series G. There's like the rumored$100 billion plus OpenAI fundraise. It's in progress. Like the numbers for this year will be even more extreme. And so we thought maybe it'd be fun to like dig in a little bit on how this part of the universe works and like what are some of the trends and things that we're seeing. And so maybe like just to start, because I have a hunch that like the way Anthropics$30 billion round got done is very different than what my like pre-seed process looks like.

17:32And so like Angela, like how does something like that even come to be? The interesting thing about these rounds is that it's not like a surprise. It's not like you win a prize for suggesting that you invest in Anthropic at some valuation. In some ways, it's not even about investing. It's just more about capital allocation. I feel like growth stage investors are now equity salespeople. They have this huge ticket that they need to go sell to different investors across the world. And it works both ways. There's a lot of inbound demand as well. And as we've talked about in the pod before, SPVs galore, like single layer, double layer, triple layer.

18:13I don't even know what these words mean at a certain point, but just the amount of people that are making funds, their entire businesses just on allocation. So it definitely feels like a shift from investing to allocating. And that's just, I think, indicative of how consensus driven a lot of the big deals are. I still remember when Thrive led the$100 billion round in OpenAI. And then SoftBank came in. There were all these headlines like SoftBank's coming in at$100 billion. The market has reached its peak, which was ironic because we didn't price the round. But just because we were involved, the consensus was that it must have been overvalued.

18:50And then in the span of a few short months, it also became consensus that investing in OpenAI at$300 billion was a no-brainer and everyone was fighting for allocation. So everything is very consensus driven. Everything is very momentum driven. And there's not a lot of variation. Like, I don't think there are any growth announcements where you look at that and you're like, huh, like, what is this company? I've never heard of this company before. Or what does this company do? And that's probably just indicative of the funding needs of these companies. If you have$40 billion to invest in Anthropic, that gives Anthropic visibility to invest and compute for some period of time versus spreading that$40 billion across 10 different companies.

19:30Then what is a company to do with$4 billion? That's not enough to get you to where you need to be. So the market feels very rational from that perspective in the way that it organizes itself. What are some of the downstream effects for it being concentrated at such few companies? Like, would most of these funds be, you know, leading growth rounds in like a larger set of companies sort of at that stage? And are those companies now, you know, like, what's the fate of those? You know, like, what are the sort of downstream effects of this? One of the questions I'd love to get people's perspectives on, and maybe you guys have interacting with these firms, is just how the value proposition of an investment has changed.

20:13It feels like for a lot of firms, you're not just investing in a company for the financial return is for some strategic angle. So if you're a multi-stage firm, the early stage firm is not necessarily about generating outsized returns. It's about getting access to the pipeline for your growth stage investments. And if you're investing in the growth stage, it's not just about putting money into Anthropic. It's maybe, oh, maybe you're a hedge fund and you have powered land somewhere and you want Anthropic to use your power and land and becoming an investor in the cap people. So everything feels like it ladders or what Thrive is doing with its holding company.

20:46It feels like investments are not just investments. There's some laddering up. It's almost like investing in the growth stage is like a Trojan horse of sort for the larger strategic objective of the fund, And whether that's Thrive or General Catalyst or Andreessen or any of these really concentrated growth funds, that's how it feels, at least to me. I'm curious what you guys think. I mean, I think my question really came from like being an early stage investor and like, you know, when you set your tiny startup out, right, like, and they decided to get on the venture train that is the ABCD, you know, etc.

21:19around like you want to know that there's capital waiting for them when they reach those phases. And I think this question of concentration just around, you know, like top 10 or whatever companies that are mostly in AI, just sort of like, you know, I think that it changes the trajectory and it also changes the mindset of startups, founders and investors who are investing at early stage. So, you know, I think like maybe the data hasn't shown us yet exactly, you know, the answer to my question, which is like what happens to all these companies that have more recently raised like a C or D round? Like is there, maybe they go public faster or maybe, you know, they have to figure out some sort of survival.

22:02Maybe it'll bring back the small cap IPO, you know, which we've talked about a couple times before. I know. So that's where my curiosity, if anybody has like a thought there, that'd be, I'd love to hear it. I feel like we're still working through COVID. I don't think all of the morass that was created during COVID has been worked through. I think everyone thought 2023 was going to be the year and then 24 and then 25, and now we're in 26, and there haven't been as many shutdowns or M &As or IPOs. And so there's still just this big bolus of companies that are just existing that's tying up people's time and headcount.

22:38So I'm interested to see when that gets worked through on top of all the new companies that are being created. I also wonder how much of this is a reflection of the state of the public markets where it feels like you have to be a massive IPO to be able to go out. Like Box's IPO, we were doing$100,$150 million in revenue when we went public. That just doesn't even feel feasible today. Helen, Dropbox was bigger, but not astronomically bigger. And so, you know, either you're SpaceX or Anthropic and you're big enough to sort of like completely make the market or I guess any other exit is going to be ideally something that tucks into one of these companies.

23:25Kind of feels like it's the vibe in the venture world today. I think it's just a function of how the public markets have evolved. And one of the big differentiators between whether companies list on the NASDAQ or the New York Stock Exchange is sort of how quickly either of those exchanges can get them included in the ETFs, because that's where all the flow is. And I think if you're a small cap micro cap, that's just a it's not going to happen. And so there's some some natural bias to that. But I did learn two new phrases from public market investors today about all the volatility that's happening in the sector trade.

24:02And that's FOBO, which is, you know, a version of FOMO, but it's fear of being obsolete. So it's basically like any industry that is at risk from the AI trade. So that was software and SaaS, which you guys talked about last week. That was insurance recently because OpenAI announced some integration with an insurance company. And now it's moved on to real estate and REIT because people are worried that there's going to be no more desk workers. Everyone's just going to be replaced by agents and therefore you don't need commercial real estate anymore. So fear of being obsolete. And then Halo, which is hard assets, low obsolescence.

24:38So after two decades of money pouring into software, now all the money is going to hardware. And someone was saying, if you just look at the$650 billion that the hyperscalers are plowing into CapEx, that dwarfs any amount of spending they have on software. And so, Helen, to your point, there's probably just going to be some catch up that the industry does from investing in very capital light software businesses to shifting into more hard assets to capture that spend that's flooding into the marketplace. Although most of it's going into chips and NVIDIA. I think something like 80 % of the cost of a data center is just the chips.

25:15And then 20 % to the dancing robots. Yes. That will haunt Helen's dreams. Maybe like another question coming from like the early stage investor perspective where like, you know, the mythology around early stage investing is like, you know, you have to be contrarian, but right and see things before other people see them. And I think some of these like growth stage investments can look kind of obvious. and I don't mean that in an offensive way, but it's like, oh yeah, like Anthropik and OpenAI are like both seem like they're going to be winners of this AI platform shift. And so what is harder than it looks about growth stage investing?

25:54Is it the access? Is it winning allocation? Is it like figuring out the price? Although so many investors are coming into this round, like who's even setting that? Like what's the hard part? I think there's probably a bifurcation between like the mega mega rounds and then the rest of growth investing. And for the mega mega rounds, it's probably a question of allocation. Although, as we talked about, the size of these rounds are so big. It's more if you're investing enough to get the allocation. If you're willing to invest 50 to 75 million, you're probably getting allocation. It's just harder if you are trying to invest a million into a 50 billion round.

26:29round. So I would say that is really more just about getting allocation. I would say the true growth investors would probably say they were the ones that saw the potential in Anthropic when it was a$4 billion company and had no revenue versus when it was a$400 billion company. And so just what it means to be a growth investor has become so skewed given the trajectory of these companies. I think Anthropic has said that they're at a 14 billion run rate and it's taken them five years from when the company was founded to reach that level of growth. I think it took Google, which I think heretofore has been like the best business model in the world, something like eight or nine years before they reached that, although probably much more profitably than Anthropic.

27:13And I think it took Meta something like 12 years. And so previously you had the arbitrage of where the inflection and growth has happened. And I think in the AI world, there isn't any like smiley face or J curve. It's just like exponential. And that's what's made the trade so obvious. But maybe a corollary to that, something I've been reflecting on, I don't know your thoughts, is just for investing in general. I used to think that picking the right company, assessing the right metrics, doing the right analysis was what set you apart. If you figured it out, that was what it was. But in my mature age, and I don't know if it's growth investing or investing in general, I've realized that that's really just table stakes.

28:01And the hard part is actually influencing the founder to your point of view or to achieve what you want to do. And we can debate whether that's good or bad. But that's been something that's on my mind, which is like, what is hard to do? It's influence. And I think the leaders of all of these mega funds have incredible influence. Like I saw Sam Altman post a tweet congratulating Josh Kushner on Thrive's fundraise. And there's a ton of investors on OpenAI's cap table, but he's not posting that compliment for every fund. And so Josh's relationship with him, his influence, that's a real differentiator versus saying like he did a good job picking open ai that's so interesting i feel like we've we've been so um obsessed with access right like that to me that's been sort of the theme of like probably stage investing and you know are you catching a hot founder when they're leaving their their their last company and you know and and then when we talk about spds it was another thing around like access where people are willing to sometimes pay the double the double triple layer of these just to say that they have, you know, Anthropic or OpenAI in their portfolio.

29:08And I think the influence part is so much more interesting and sometimes invisible, right? Like, and often not touted so publicly the way that that example that we just used. So I wonder what more of that might look like. I do, I am concerned that it is concentrating, you know, not only across a certain number of companies, but also, you know, across the certain number of influential people that are able to do this influencing. I don't know how you democratize influence. I don't know how you, you know, sort of spread the wealth of influence the same way that access, I think, you know, could reasonably get democratized.