20VC: Why Being First To Market Does Not Matter, Why You Do Not Have Defensibility on Day 1, How to Analyse Market Size and Present it to Investors, Vitamins vs Painkillers; Do Vitamins Survive Recessions and Good vs Great Messaging with Guy Podjarny @ Sn

21:58It's still believable. So I had to reaffirm the conviction. I had two primary moments where I had to do that. One was, I had an advisor who was, I really think of him in high regard. He wasn't super involved, but he heard the conversation doing it and says, Guy, I think you're fucked. You're basically a classic dev tool, Pitfall, which is you get a lot of developer love, but nobody's willing to spend money on it. And really, I was pissed, I was really annoyed, I came back, there was an aposysco, flew back to London, and basically spent sort of the other weekend fuming and thinking, am I? Am I doing it?

22:28And the bottom line was basically reaffirming the conviction that I would rather crash and burn than pivot to just focusing on the security audience, in that I don't want to build just another slightly better master trap. I want to build something that matters and what matters is breaking through to developers And so that was a big one and then I guess sort of a similar maybe a little bit more frequent a case is even before that I had a whole Horde of vcs come along see the thousands of users outside see the visibility and Basically trigger a preemptive process and I leaned in I said okay, it looks compelling I think like I basically drank my own cool aid and I leaned in and everybody and everybody looked at the company and And repeatedly everybody and everybody looked at it and says, oh, amazing usage, no revenue, can we stay friends?

23:13Maybe we'll consider for the next round. We don't know you yet. Do you have any advice to founders having been through that then? I think you have to be careful around how quickly you lean into a preemptive notion. Preemptive and the idea of sort of VCs coming along and saying, hey, maybe I want to, I want it so bad I will pay up ahead of time. It's very ego boosting and it feels very good. and then you also know that you don't want just one horse, like you don't want just one bitter, and so it's very easy to say, what did I talk to everybody now? And when you do that, you're sort of going a bit old and you think you can really believe some scorched earth.

23:47I think for us, if it wasn't for Ed Sim, at Bullstart and like, him and Elliott being believers, and they basically topped us up, we did get some offers, we just didn't get like the right offer from the right investor, and I had a whole personal thing, my father -in -law passed away literally during the same sort of week on it, and I was thinking of whether I take VC calls from the Shivaf, it was an intense period. And they stepped on, says, look, we see it, we believe it, we think just sort of on the right path. Why don't you take this sort of smaller, this bridge check on the best valuation that you've received in this sort of term sheet by a smaller amount of money.

24:15And that was great. Like, I'm really all around. And that set us up and allowed us to get to the point. This was still eight months before we got to a hundred thousand ARR. But then four months after that, instead of a hundred thousand, we were at six fifty, and a year after that, we were at four and a half million. And so basically there's a roughly two years in, two and a bit years in, the dollar funnel started going through the right direction. I'm in many companies that are a hundred K and arrow after several million dollars burned and several years. And honestly, as an investor, I'm going, oh god, why didn't they just give me my money back or give up or do something different?

24:50This is not fucking working. What do you say to those founders? He's been through it. And how do they know whether to keep going or actually just, it's not like just call it a day? I think you have to have an understanding. To me, it comes back to that first principles thinking. And so you have to break it down and says, why is it not worth? If the answers are only, if only I built this feature, if only I talked to that person, then I think you're missing something. So I think if you're just churning, if you're just trying to hit in different directions, then it might indeed be a pronomatic sense.

25:20You have to have a theory of change of what is it fundamentally that is causing my current situation, and what am I doing about it to significantly change it, whether it is reach, whether it is core product principles, and therefore which use cases do they enable, whether it is indeed different sort of buyer persona than a user persona, etc. That's really interesting when different buyer personas versus user personas. I think what we see now with the downturn in the macro is the reversion back to purchasing power to the CFO away from individual contributors and teams having a lot of purchasing power.

25:49We now have very segmented buyer personas and the user personas as he put it. How do you think about effective messaging when the person buying is not the person using? Yeah, it's really tough. I do think this is a bit of a tough moment for PLG companies. I still think that it's a temporary reality and so you have to think about what makes you think it's a temporary reality. I think a lot of the fundamentals that got us to sort of the PLG movement is the fact that modern organizations rely on an empowered workforce that can make decisions and move quickly. At the moment, everybody's looking for places to cut.

26:20Empowerment is not the word of the day and things get centralized. If you're a startup, you have to acknowledge that in the current reality, and you can shift your messaging a little bit to focus on, no, for instance, productivity or cost savings that this product can provide. But it's a little bit tricky because you might get lured down a path that is not product led, that is enterprise, even though your market is really best situated to be one with product led. So it's a bit tricky. I have a few angel investments like that, and it's not easy. You have to make a case -by -case decision. But I think fundamentally, over time, I still think product -led, empowerment -oriented solutions that focus on the user versus the buyer are important.

26:55You have to help your users communicate with your buyers. You have to help them understand what is the use case, what is the value proposition. I've said use case probably already a dozen times and I say it all the time because people confuse this with they say ROI, they say features, they say they talk about the technology, they talk about just finance. All of those are not important. What's important is the value to the customer. All of these things are just symptoms of it. And so you really have to understand what is the value. And my favorite statement to customer is to say, look, if we align on the value that we provide you, we should be able to align on the price.

27:26So I think if you figure that out as a company, what is the value of provide, now it's just our articulation element. It's about how do you get that message across? So I agree it's a tough time for PLG. I also think it's a tough time for unbundled, specialized products. I think we're going to see this kind of reversion back to a world of bundling. Wherever this is cheaper, you will probably give up your calendar and go back to Google and if you are in a large organization as an example. And I do agree with that reversion back to bundling and how do you advise founders then hearing an unbundled world?

27:55I think it's always a bit of a balance between them and so best of breed products for the point activity that they provide are presumably better, they're best of breed. I think right now there is a lot of platform consolidation. I will admit that sneak is benefiting from that and that we have the breadth. But I think a lot of it is from just from cost savings, single vendor relationships, things of that nature. But I think there are ways to build a platform that actually makes it truly better in total if you make your products work together. It really, it again, comes back to that notion of how much additional value, how differentiated you are.

28:27If you're a point best of breed product that is twice as good as the generic product, you probably will still succeed, like companies or customers will still want to use you as long as you articulate that value. I think what maybe has changed is the appetite for a product that is 20 % better, but is indeed separate and has all the overhead of having another vendor and another solution implemented. Products often categorizes either painkillers or vitamins. Do you invest in vitamins? It is better to have a nerve. It's better to have a pain that you're addressing when you're talking about the primary.

28:59I like to think I have this two -way -two in my head, which talks about kind of pain and frequency. So if something is low frequency high pain, something that may be like a big incident that happens, or maybe building your sort of R -back system, something, then really you need a strategy that is all about presence. It's high pain, so when it happens you need to be there and be available. If something is high frequency low pain, then it's all about friction, but something that always bothers you a little bit, and so the effort of picking up a solution needs to be proportional to the pain that you're sensing.

29:29So it's really all about friction. And so I think those are the two primaries. If something is high frequency high pain, it's all about comparing it to the existing solution because there's no way that they're not doing anything about something that is high frequency high pain. And so it's all about the better master app. It's all about differentiating from existing approaches to solving it. And if something is low frequency, low pain, and maybe that's like a version of some of the vitamins, then it can be your lead at the best. It can be a feature, but it can be the primary thing that you're doing.

29:56Really that kind of nature is to think true. But it's big fans of 7 -power, Samulten Helmer. Probably one of the foundations I'll go to study at everyone to read who joins 20VC. Why do you think it's really important for founders to understand 7 -powers and where their power's lie first? I mean, so I'm a big fan of the power's framework. For those who don't know the high level, they just do talks about how do you deliver value to a customer, eventually forming as like a free cash flow in a way that is sustainable, superior, and significant. So something that is truly better, it's truly superior.

30:26It's significant. It matters that it's better at whatever it is that it does What's not whatever an ice cream truck with the sort of the tallest roof? It doesn't matter and it is sustainable. It's hard to copy I think the reason it's important is the worst thing that can happen in my opinion to a startup is not to crash and burn But to get stuck is to build something that is like a little bit valuable and you build it up to a business That is two three five million in a row or not dismissing the sort of the difficulty of doing that But then you get stuck you do grow at a 20 % rate from that rate and it's too good to just walk away from but it's really not what you signed up for or your investors signed up for.

30:58I think powers really are about the ability to grow your business. You think ahead, again, you anchor in the future, and you say, what is it that I'm building that will actually allow me to build on and grow? And if you don't have power, if you're building something that just has product market fit, but it's actually pretty easy to copy. If you're building something that purely relies on operational excellence, then you're in a pretty risky situation, right? and if any competitor comes along or like a burst of incumbent sort of operation excellence and you might lose your place, the idea of power is indeed to be that multiple.

31:31And so I don't think you should like dive in and only care about power at the beginning, you need to be building value or like sustaining some value you've created. But if you don't think about it, then you're carrying that risk of just getting stuck. Do you believe in defensibility at the early stages? I'm very strong, which is like defensibility from day one as bullshit I always think. Do you agree with that or do you actually think when you're looking at companies you angel invest in are highly defensible. I like this and fence really plays a big part of your mindset. I think at the beginning you can't be defensible you have nothing.

32:00I think there may be the only exception to that is if you have very unique knowledge in the fight. Exactly. That's an exception. I mean now she's a really unique time with kind of a new wave of AI companies, which is like if you come out of 10 years of Stanford's AI lab, that is a defensible load of knowledge which other people likely don't have. But potentially, although now that has grown, so that's the cornered resource kind of power. And do you have some sort of very unique set of skills that nobody else can have and are they undead superior and indeed significant. I think specifically right now at AI, the space is moving fast enough and there are enough people that it's not really a cornered resource.

32:30It can be unnecessary and a valuable capability, but I think it's hard for that to be alone. But what they do think is critical is to think about how does this business become defensible. So if you assume success, if you assume you found product market fit, which absolutely should be consuming 90 plus percent of your attention should be on product market fit, not power at the beginning. You have to build something of value to then sustain and differentiate. So it's a step one and get product market fit and then we think about percent power. Correct. So I think when I invest, I think about some theories about how you could build a defensive project over here.

33:04If this was to succeed, what is it? Would you have a network? Would you be accumulating some data? Would you be aggregating accumulating switching costs from within the customer? Is there any sort of counter -positioning that you're doing it? Are you doing something that incumbents, even if they see they would choose not to adopt like the Netflix blockbuster example, right? Or in FirstNegut was dev first. Dev first is something that is counterposition to the security industry. Look at this with traditional journalism, they will never send any questions ahead of time. And they choose not to. I will always do that.

33:32It's a counterpositioning example, I think. I think so, and I don't know the industry well enough, but it's an example of that of saying, if people are already well incentivized to believe and stick to the existing system as it works, because that is what makes them powerful today, then counterpositioning and get them. And so I think per Helmer's book, the two powers that you build at Inception are cornered resource and the counterpositioning. And so you can come indeed with some unique knowledge or perspective or with a counterposition that is hard, that's like the innovator's dilemma, hard for the incumbent to produce.

34:03I don't think you should focus on those, but as an investor, even at the early stage, I tried to theorize about what could it be. And then once you theorize that you put that aside and you really just focus on product market and you have to get something working. Once you get something working, then you start tweaking. When you're getting to the point where you hit product market fit, and now you need to scale some things and things like that, maybe you should tweak priorities. You shouldn't overhaul priorities, but you should tweak priorities for things that matter. It could be the type of legal license you give to your customers around the use of data that you have.

34:33It could be investing in some viral mechanism. It could be trying to invest in stickiness in switching costs. If we think we're going to product market features is the first chapter before we moved to seven powers. I had an investor update last night and it was a 1 .4 million error of business. It's got a lot of a two and a half year period. It's been a little bit slower than ever and thought it's not growing particularly fast but it's not doing badly but it's taking quite a lot of cash to get there. And I just let it nice it. Does this have product market fit? I don't know. Customers are staying, they're paying, there's enough of them, there's enough money, 1 .4 million is not nothing.

35:07It's not being pulled out of their hands. Was it very obvious fee when you have product market fit and when more often not with your angelic massmen is it obvious? Yeah, I think sometimes it isn't. To me, product market fit is really about when demand outweighs your capacity to satisfy it. Kind of can't hire people fast enough, spin up servers fast enough, whatever it is, the scale, because demand outstrips it, then I think you hit product market fit. I think like first market it's a little bit of a poorly defined term for sneak there were at least two elements to it. There was the product user fit of getting to developers.

35:41And so I think we hit that one pretty quickly. And there was a lot of learning still about getting that done, but I think we got that. But it was very different between that and the product buyer fit, which is probably a bit more akin to product market, if you talk about the business. So for me, with you, the product user fit and then you've got the business model fit. It's almost like the same problem as Twitter, in some ways I have found which is like, Twitter's a great product by snaking that it was, but you now need to layer on a business model that works. Yep. And so that's why I think in use cases, I think in value propositions.

36:08and so who is it that you provide value to? That's the first question. If you don't provide value then you know it's no good and are there enough of those and then eventually is would they pay? Do you think there's different degrees of quality when you look at the different seven powers? So brand power is one and when I look at that I'm like I love it and I'm as members much of brand person as anyone but I believe it's inherently more transient and momentum driven than some of the other powers that we can discuss. Do you believe there's different variants of quality of power? Yeah, for sure. I think I actually have had a couple of conversations with Hamilton.

36:42And so we discussed this. He bends up this thing, his own brand and process power. So it says, both of those are just so easy to claim that they end up being a little bit loose in your definition. Actually, I agree with that. I like it brand site Chanel, like Nurivi Tone. Though brand power is very powerful. He's like for a tech startup or for a company that is that is building out is just so easy to claim that you have brand. I think the idea of brand is really to be able to sell the same product for a significantly higher price because of people taking pride for it. And so like for instance you think about snake, you know, snake has a certain amount of brand power.

37:15There's a certain amount of like fairy dust, sort of dev ops fairy dust that all the security companies want. There's a certain amount of that that people believe, but it's not a sustainable sort of superior, significant capability. I think that's really the sort of the risk with powers is that try to call everything a power. And that loses the whole idea of defining and understanding your powers is that you know where to invest. But let's analyze Snake, which of the seven powers if you could choose to? Are you like, I hang my hat, we have the strongest. Yeah, and we went pretty deep on it, and we've done power exercises for different competitor groups, like how our powers as compared to the DevTools that try to go into security versus our powers compared to the security players are a little bit different because the capabilities of what's normal in the ecosystem is different.

37:59I'd say that the next two primary powers are, no one was counterpositioning, which still holds in the security space. This notion of coming in developer first is to an extent at the expense of some seesaw power of some sort of top -down decision power in which a lot of these security companies have been designed to satisfy. And so that whole approach is very different. And then the second is, and I will claim process power here despite the sort of the extradicality and that is a developer product that growth, the sort of the PLG in the security industry. And that was actually my argument with Hamilton, which was to say, I think that if you go into an industry that is traditionally top -down, it is coming in with a product -led approach, is counter -position at the beginning, but over time you build process power, by the sense that, let's say, a bunch of people resigned from sneak and went to an existing sort of company, even a new company, but definitely sort of an existing one, and they try to replicate the product -led growth motion.

38:53within that company, it'll be very hard for them to do it. It is mirrored into the culture and the product and the go to market and it's so intertwined in how we operate. That is very hard to replicate. But it is a power against the security incumbents. It is not a power against the ones coming from the dev -turning side. If you isolate those now and you sit in the room with your team, you're like, great, we know those two powers are really well -versed. Does it change your opponent? Yeah, I think, firstly, it might be interesting to think a little bit about the exercise that we've done. So what we've done was we took four primary, better categories and for each of those, we tried to write down the primary capabilities that we differentiate on in those areas.

39:28And then we thought about the capabilities we could build that we think are sort of interesting to us. And then for each one of those, we sort of assessed, are they truly superior, significant, sustainable? And that was a good exercise, even if we've done nothing else and sometimes actually we've done this few times, sometimes we've done nothing but the conversation, but it still distills your understanding of it. And I think that's very important. And it's a mechanism this and questions like, would this be more important in five years or not, are things that I do with the product organizations and definitely with the lab organizations, which is very skilled in this now, to help us anchor in the future, to help us think about where it is going and where it is headed.

40:02And so that is very valuable, by the way, the hardest part is then distilling that into the top items. What is the one or the two items that you would pick for every sort of box? What do you think is the biggest mistake that found us make when they consider seven pounds? Most of them just don't consider current powers, right? They think about things a bit more loosely, but I think people are unwilling to pick. They think this is important and this is important and this is important. And so they end up under investing in the things that matter most. And so especially in the context of success, at some point you feel like the world is a roaster, you can do a lot of different things.

40:36You go into them. So at the beginning, it's about product market fit. It's not about powers. So if you actually over rotate on powers, that would be the mistake. Over time, as you get something that is successful, I think powers are important because they help you pick the next thing to do. They help you ask, okay, if you're going to expanding X at another product or expand an audience, the best question to ask is, which of your powers help you in that expansion? If the answer is none, then you really should pause and reconsider because basically you're saying, I'm going to go into those areas and I'm going to compete on operational excellence merits alone.

41:07And so if you don't even know what your powers are, pause and go off and have a conversation about it And it doesn't really matter if you use the powers kind of framework. It doesn't like that's just a helper It's about understanding what are your core sort of sustainable differentiators in terms of product market fit I think the single biggest I've done now astonishingly 170 investments over eight years, but the single biggest term of companies that reach product market fit that I don't know, I found it's speed of execution. Like, granny, the speed of execution. Do you agree with that and how important do you think speed of execution is in terms of getting the product market fair?

41:42I think of it as iteration. And I think there's almost like an element of hubris in thinking that you can get into your ivory tower, come out in a year and come out with some wonderers thing that is precisely right. It isn't really, I think, the best sort of bet for you to make. And I'm a believer and I think what you need to do is you need to iterate. I think that is the sort of the speed of delivery, how quickly do you iterate? The faster you do that, the faster you learn. The faster you learn, the faster you're going to hit. Product record fit. So I agree with that. The one caveat that I would add is you need to be iterating in the right direction.

42:10I like to say that if you're good, then you optimize for the feedback you get. If you're not good, that's a different problem. And if you're, if you're open with for the feedback you get, you want to set yourself up to be getting the feedback in the area that matters. And so if you want to build a product -led growth company, and all of the feedback you get is from a dozen design partners that you work with in a top -down fashion with some of the CTO, So then you will optimize for something, but it's unlikely that you would optimize for getting a self -serve community -led product. You want to iterate quickly, but you want to understand what is the fit between your product and the go -to -market, and you want to put yourself in a position to get the feedback in the right direction.

42:44There are so many other areas I wanted to talk to you about. You've raised multiple rounds of funding from some of the best in the business. What do you think of the most common mistakes you see your angel investments make when fundraising with venture investors? And what are some of your biggest lessons from raising from some of the best in the business? I think the biggest mistake angels make investing with VCs is under appreciating the different context, especially if you're as co -investing with a VC that is primarily an AA or a B VC, and they're signing a seed check. For them it's a very small bet.

43:13It's the opportunity to go ahead. For you it might actually be as an angel, that might be your primary check. I put a lot of weight into the diligence and the vetting that's all the sort of the venture firms that I co -invest with the due and so I do value that a lot but I also want to contextualize it for me and to say whether that's important and for me personally while I expect the financial return I invest largely for the learning for the journey I feel it helps me first of all it's fun second is it helps me actually and sneak helps and understand I think it helps me be a better craftsman and so I have all sorts of filters that the sort of the VCs don't necessarily have my first filter is do I want to get on a call with this person again do I like them and then is this an area that is of interest do me.

43:53Ironically, for instance, I don't invest that much in cyber. And there are exceptions to that statement. But for the most part, I'm more passionate about sort of product lead and that those types of systems and cyber tends to be more top -down. I think you build your personal preferences. Don't just think of it as an asset. How many checks have you written? I'm close to 100 at this point. Can I ask you like, financially allocate towards angel investing? Do you look at kind of holdings and go, okay, we're going to put X amount here into angel investments? Only as a limiting factor was I don't get don't go overboard my primary limiting factor is time I invest versus taking advisory roles because I want to know like the base minimum is you get my money and Hopefully that's helping you build now on top of that I want to be a value -add investor and I want to learn from the journey And so we're relevant and when where I can I take calls and I do a fair bit of those I probably spend I know a day a week or so no now on angel relief stuff maybe a little bit less That is my primary limiting factor beyond that I've veered a little bit because I do as much as I do now in direct angel investments.

44:49I mostly actually reduced my kind of LP allocation. You know, I find I do want to limit my venture exposure. And I think it's important to remember for me, most of my money is still in snake. Most of my money is in the venture. My business, like everything around me, I am in a high risk mode. And so in theory, the wise thing for me to do in the bank is to put all my money in some fixing comment. So you know, get it there because really it's about don't lose this, the money that I have, in practice I just don't work that way, I'm a risk taker, and I enjoy the journey. And so, what's the biggest investing mistake?

45:21Investing in things that are obvious, and it's really because they stay small, and they come back to seeing almost entirely focused on operational excellence. I like that there's something a little bit crazy. I try to count the lips of faith that I have to make in making an investment. If it is too many, I don't invest, but if there are none, I also don't invest. There needs to be something a little bit out of the ordinary like I believe that for this to actually translate into something big So I always have if we need a secondary jump I'm out and so a great example of that would be a neo bank for teenagers Okay, the big question the risk there is can we transcend for kids or to 14 ages to also converting them into just adult Customers that's the jump really what I don't like is for adult customers and then there's an additional jump beyond that.

46:09But the secondary jump, then I'm out. Yeah, what do you mean? I do, and I do think it's easy to see how if you have too many loops of faith, then you can't do it. I think to me the learning was that if there are no leaps of faith, it probably means there are a dozen companies doing exactly the same thing. And if you were to do it, which I at this point typically don't, then you really are heavily betting on the operational excellence of that team. And so that's a different lens to set for the team. I totally agree. Price wise, I have the best companies consistent even the highest price when you look back.

46:40No, I mean, I think there is a correlation. I think it comes back a little bit to the sort of the founder's ability to sell versus their ability to raise money. Right? If you can articulate the opportunity very well, then oftentimes that translates both to your ability to sell it to investors and the ability to sell to customers. But no, I don't think it correlates heavily. I think it's like slightly. And I do think also companies can get themselves in trouble by raising too much money too early, mostly because they end up sort of pouring fuel on areas that don't actually need to be accelerated because you don't actually know what you're doing.

47:10And so I think it's dangerous. Now we're in a slightly different reality in which some companies that have raised at a higher valuation, they need to mentally prepare. They're going to work their ass off for another sort of two years now to basically get a flat round because they got such a kind of overvalued round. So if you're early and you pre -revenue and you got a hundred million dollar pre -money valuation in the previous round, you now need to get some revenue and you need to work on it and hopefully in the next round you've earned That sort of a hundred million dollar value. Will you be able to retain your talent as team members?

47:42You're going wait a minute. I'm gonna bust my ass off two years and I'm gonna have flat stock options When I could just go to an AI company and get based to stock options people should get top -ups in equity And I think investors should be ready to do that you got the higher valuation And so you raised more money at a lower price It's a little bit easier for the valuation, for the sort of the investor that actually has paid that amount, but it's a little bit harder for them to accept it. But I think generally speaking, people should be financially incentivized in a competitive manner around that growth, and they should be believers in the mission, especially early.

48:14Two more questions, and I'm really unfaithed, that I'm going to ask them anyway, and you can't get away from it, because there's a light on you. What was the best first investor meeting you had? The best first investor. Someone who invested in sneak. Yeah, you're someone who invested in sneak. or maybe didn't invest in sneak, but the first invest in meeting that you have with them, where I was just like, this person gets it, they understand, they see the future with me, this is a mind -melt. Ooh, yeah, it's tough because it's goes a fair bit back. The name that comes to mind is Amit Patel, who is an angel investor, who joined us.

48:42In that sort of round in which, like everybody was looking at it and saying, thanks but no thanks. On hits, when Bullstart did the top up, I think he's the only angel investor who's joined there. He's a professional angel investor and I've spent, I think, his one -o, if not the most, sort of impactful angel investor in the Instinct. And I want to dive into a quick far around now. So I say a short statement, and you can meet your immediate thoughts. That's not OK. Yeah. So what do you know for sure that others don't believe to be true? That when you have a good idea, you're not the only one that has it.

49:10Rather that you never have as much time as you think to act. We think that we're sort of these unique creatures that just have this sort of unique insight and practice were influenced by everything that happens around us. And there are other smart people around. They're noticing the same thing. and they're probably building the same type of solution with the same principles at the same time. So, you better get going. What's the biggest hiring state he's made? Probably hiring for too big too early. And so hiring people that are over -oriented processes or longer -term status of the company, trying to sort of be ready ahead, but are not necessarily that good in today's needs.

49:45You can invest in one fund as NLP, obviously apart from 20VC, which fund you invest in. I like a bunch of different phases, but bold start would probably be my pick. What's the most painful lesson that you're also most pleased to have learned because of the learnings that you have from it? I think that when someone isn't working out in the company consistently, letting them go is not only in the company's favor, but also in their favor. You're really doing them no favor, keeping them in a failed position. That's doubly correct when the company is growing. When you're in hyper -growth, when someone starts to fall behind, especially in a leadership position, they need to be twice as good to be able to catch up and keep accelerating to the twice in size that you're going to be in a short order of time, and oftentimes you're just setting them up for failure.

50:28You brought in a CEO who sat on the board for many years and you worked crazy with for many years, but you handed over the role of CEO. It was hard. It was hard. It was also one of the better decisions that I've made. I think you have to understand what is it that you want to do? If you want to be a big company CEO, then as a founder, as long as you're executing well, you have the right to do it. Otherwise, you want to ask what the company needs from me most, then what do I want to do? And for me, I felt like the thing I was most valuable thing that I could give the company was around my ability to see around quarters, my ability to understand where this is going.

51:01And I basically didn't have time to give that to the company because I was spending all my time trying to scale the organization. And the flip side, I had this opportunity to bring Peter who was amazing and my relationship with him is unique. And he could basically come on, do that better and focus me on the other piece. And that was also where my passion was. And just because something is working doesn't mean it can't be better. So it wasn't from a point of failure. It was another step that made it even better. And it was very hard and it continues to be hard like any kind of a partnership is.

51:27How has being a father changed the way you operate and lead? I find that the analogy of the company is your baby, your startup is your baby, very apt. And I think one of the things you learn, I have two kids is, you know, when you have one child and you want to accommodate their needs, then it's really about, you know, they want whatever, and you need to either absorb it and give them or not. When you have two children, you realize you're in a position which you have to. One child desires might come at the expense of the other, and you have to actually teach them to do the balance and do what you think is communally best.

51:56And I think it's the same kind of in the company, you know, clearly it's adults and not kids. But you learn over time that you can't please everyone, and I want everybody to love me, and I think many people do. But at some point when you have enough people, there's going to be some people that are unpleased. and you need to do the things that is in the kind of the greater good and the good of this broader family, even when you still think about it as a family and even when those are hard moves to make. Do you agree with where a family not a team, what do you think it's a team not a family? I think it's a team, but I think teams can get awfully intimate.

52:24I think it's okay. It's a team that is on a mission and what type of team is it? Is it a commando unit stuck in some format? Is it a set of explorers going to Antarctica and doing it? It's not a team as in a group of friends who met for a basketball game on the courts and went back home. It's a team that is all in together and I think that's sometimes that's a more intimate and close -knit group than a family And so making moves like letting someone go or quitting if you're one that goes They can be awfully emotional and awfully personal. I do think it is a team because you can't fire a child If you can't fire an debris you can't quit from your family.

52:57I know many would want to and so I think it is a team But it doesn't make it any less intimate. What's the single best performing angel investment when you think about cash back? like DPI or TVPI, but potential to return or return cash. What's the best one? Yeah, I think there's a time horizon elements to it. Probably for me right now, it's a security scorecard, which is done very well, and that was invested all the way back at $6 million valuation. But a bunch of others are doing quite well. Cloudinary maybe is the other contender. Maybe even better. Cloudinary is an image management company that's been bootstrapped that I was an advisor in early on.

53:30Yeah, I've got a few of them, and I do think Synthesia is an amazing company. I'm invested in now. Like to dash, there's a bunch of great companies that I'm excited to be investors. Penaltimate one more, which I'd change about the world of venture. Venture companies would never invest in venture companies. There's nothing scalable, there's no tech, there's no real kind of scalable assets in venture today. Most of it is like law firm style, a bunch of smart people that are relying on hiring additional smart people. And the little tech that does get built is all about deal flow, it's all about finding investment companies.

54:00And I would love to see venture investing in tech that makes their companies more successful, that makes them more scalable, but in general kind of make it a bit more systematic. And I believe I don't know for sure that there are sort of inklings of this that are happening, but I think that can be a disruptive force in the world of venture. Final one for you guys, 20, 33, 10 years, okay? Where's Guy then? Yeah, I don't really believe myself if I talk about past the five year horizon, but what I would like to think is that I focus on our family foundation. So we started a charity focusing on social inequality.

54:31It's a learning journey right now. It's a pilot a few years. I've got a couple of people in the UK I've a couple in Israel and learning how to give away my money and and it's fascinating and it's Humbling and a lot more sobering than the sort of at the end of the day Posh world of tech and I would like to think that in 10 years that would be a more lion share of my time I have to ask this you mentioned giving away money. How do you think about your relationship to money? I'm very uncomfortable with it. I like my kind of creature comforts I like my sort of larger house and and pause vacations, and I enjoy those.

54:59I like premium, even super premium. I really dislike luxury. I really dislike sort of static symbols and wearing something because it is to show that you're doing it. Those are negative value to me. And so I'm learning it. I am enjoying the ability to help family members, to help friends, and I think those are the things that give me the most pleasure. And eventually it's a bit of a burden. And I talk about giving it away. I think all the money that I have at Snake, my wife and I, we're planning to give that away. But when you give away a larger amount of money, suddenly that becomes a burden, which is not donating $50 to the UNICEF.

55:30So burden, I accept those moments where I get annoyed with it and I don't pertain to be miserable for it. It's first -ass problems by definition, but I think it's an effort, not just to joy. Listen, for larger amounts, we'd be happy to relieve you of it for 20 VC donations. Ah, I've loved it. This has been such a broad discussion, but thank you so much and this has been so much for all my friends. Thanks for having me and thanks for putting this on. I always enjoy the episodes. Yeah, that was fun. I mean some real Mythbusters there, Defence BBC on day one doesn't matter, being first in market doesn't matter, absolute Mythbusting episode.

56:04Guy was fantastic, if you want to see more from us, of course you can buy a certain 20vc on YouTube, but before we leave you today, you've heard me talk about how Coda is the doc that brings it all together, and how it can help your team run smoother and be more efficient. I know this because Coda helps me, we have many researchers in the team who bring all the content together for the show, and they need a single place to work, collaborating than collect notes, data and information in any format, and that's why Coda comes in. They can help your team run smoother and be more efficient. Coda allows your team to operate on the same information and collaborate in one place.

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58:25Fun managers can focus on making great deals while Anjelist handles reporting, taxes, compliance and more. So if you're ready to scale your startup or fund with the platform at the centre of it all, visit AngelList .com for slash 20VC to get started. As always I so appreciate all your support and stay tuned for an incredible 20 product episode on Friday with Tomoko in CPO LinkedIn.