Meka Asonye: How to Think Like the Top 1% of Venture Capitalists l Trailblazers Podcast Episode 59

0:00Erica Wenger: Today on the show, I am so excited to be joined by Meka Asonye. Meka is the founder and managing partner of Prist Capital, an early-stage firm writing inception-stage checks into technical founders chasing the world's most important problems in the physical world. He began his venture career in 2021 as a partner at First Round Capital, where he led much of the firm's push into deep tech, backing founders across space, offshore geothermal, drone navigation, maritime security, and defense, and wrote the first check into K2 Space, now valued at$7 billion. His path there was anything but straight.

0:29Erica Wenger: Mecca graduated with honors from Princeton, spent four years in baseball operations for the Cleveland Guardians, earned his MBA from Harvard, and did a stint at Bain before moving into tech over a decade ago as an early employee at Stripe and helping scale its go-to-market org from several hundred people to several thousand. The proud son of Nigerian immigrants, he was raised outside Chicago, and he is a Cubs fan, and holds a commercial pilot's license. I can't believe you just slandered me by saying I'm a Cubs fan. I mean, I just have to show that, like, you're a little bit contrarian. in your point of view.

1:00Erica Wenger: You're from one place, but you don't like the team. You know, it's from the early innings. You were different from the crowd. It's true. I grew up on the south side of Chicago where everyone is a White Sox fan and I grew up a diehard Cubs fan. But I'm no longer a Cubs fan because I worked for the Indians and Guardians. And so you can imagine that when the Cubs ended their World Series drought after I think over 100 years and they beat the Guardians in the World Series, my entire family was celebrating while I was in the corner crying. It's tough. I'm very sorry for you. It was a real tough look, but you live and you learn.

1:33Erica Wenger: But also a very cool moment to have your worlds collide, isn't that? I mean, I feel like with so many things, as an example, my sister went to my rival college and whenever they have that USC UCLA home game, it's so fun because you have so much at stake and it's like your people kind of on both sides. I don't know. Maybe I'm like lighthearted about it and you're like, I wanted to win, but isn't it kind of fun? So I mean, I'm like a deep sports fan. And I think the affinity for sports is so interesting. Like for me, I'm a big Bears fan. And when I think about my childhood growing up, it was going to church, coming home, starting the fire and all of us sitting around the fireplace, watching Bears games, screaming at the TV.

2:10And like that Bears fandom I've passed on to my son and my daughter, whose middle name is Peyton, like Walter Peyton. Like it is, it goes through and through in my family. But I think something slightly changes when sports is your job. and I never thought I could care more about the result on a sports field until you spend 100 hours a week and years and years solely thinking about one thing, trying to put a championship baseball team on the field. And so when you see that team lose, it's like a piece of you dies. And I know that sounds like dramatic, but I've never seen so many grown men cry. Like 2007, we're in the AL Championship Series.

2:52We take the Red Sox to seven games. Losing that game, I saw some of the strongest people I know just breaking down. And I think it's just a release. It's months and months of preparation all coming down to one moment. It's disappointment for guys that you know so well. It's disappointment for other folks in the front office who've put everything there. It's the families that support you when you're on the road for nine months out of the year trying to achieve something. I think it's just a natural release when it all ends. I'm kind of emotional just even thinking about it and I'm 15 years removed from it, but it's something that really sticks with you.

3:31Erica Wenger: Yeah, it gets the heart rate up. You're like, I'm back there. I'm back in the dugout. What's interesting is as you're talking, it's kind of reminding me a little bit of founders and how they put everything on the line for their company and they ditch important events. They do whatever they can and so there are maybe some parallels with like betting on a team or betting on like individual players on the team and founders but with company building it's not so binary like you know with with baseball it's like you win or you don't yes with company building product market fit is this sort of like nebulous cloud always what were like the parallels or the differences between like being so deep in like the baseball world and now obviously venture we'll get into but i'd love to hear more yeah there's it's so funny as you're saying this a couple of things really jotted out for me.

4:12I think the first thing is one of the things I love doing and part of why I'm doing a lot of deep tech investing is I think a cheat code in investing is investing in people who are mission-oriented, mission-driven. That's not to say that you can't have capitalists who go out and just build really large businesses. But I think when the thing that you're doing means something more to you than just the financial side, you are willing to do unnatural things. I think you're willing to just go the extra mile that other people aren't willing to do. And I think in deep tech, you have a lot of these founders.

4:44And you sort of see this in sports too, where people are just like irrationally bonded together to finish this mission. And oftentimes, and I say this about my time in the front office, which is, I could disagree with the person across from me, but I knew in my heart that that person just had different opinion. It wasn't political. It wasn't self-motivated. They felt like that was the best decision to make us a championship caliber team. And to have that alignment of everyone driving towards one goal and never questioning anyone's alignment, that is why I love the deep tech focus, the mission-driven founders.

5:21When I think about my time at the Indians and Guardians, it seems very different from venture, but there's actually a lot that crosses and translates And I think the biggest thing for me is I work for the Cleveland Indians. And I don't know how much you know about sports, but baseball has no salary cap. So it is an uneven playing field. And in a city like Cleveland, you are competing with a fifth or a tenth of the resources versus a team like the Yankees or the Red Sox and the Dodgers. And anytime you're trying to compete in the same game with way less resources or one hand tied by your back, the only thing you can do to be successful is trying different strategies.

5:58You can't be consensus. You have to be contrarian. And so from my first day out of college, when I'm starting, my first job is with the Indians. And you're getting this lecture of like, if we are going to win, we are going to have to do things differently than other people. We are going to have to take a stand that some people might think are silly. But in the end, sort of we will, you know, we'll have the ultimate laugh, the ultimate final say because we'll be right. And so that idea of really sticking to your guns, even when people are questioning like your assessment on a player or your assessment on a strategy.

6:27I think that's a lot of what early stage deep tech investing is. I've made a lot of investments where a lot of our friends will laugh. Like, you really think they can do that? You really think that's possible? You know that XYZ firms passed and you're like, I don't care. I see it. I don't need validation from other people. Obviously, at some point you need validation because these businesses are capital intensive. But I think the special part about what we do is being to be the first person to help put a founder in business and believe in them and watch them ultimately make you right in the long term.

6:59Erica Wenger: Totally. I mean, what you're talking about here too is like a real strong sense of self and authenticity so that you can then see that in other founders and see that in other players. And I think a lot of that, people don't have that actually. And it's not just invention. It's not just in sports. It's like, I think having a real strong sense of self, knowing what good and bad is, knowing what right and wrong is, people sway. And so I think that it says a lot about you, that whether you're in baseball or venture that you have that like clear conviction um i want to ask you our icebreaker question we ask most folks before we get too far down this rabbit hole um because i'm really curious your answer and i wonder if it does tie to some of what we're talking about here so when you look back at your career so far and we can even go to childhood if that resonates what has been the hardest part along your journey so far that almost broke you and it could be you crying in the corner That's probably the time I felt pretty broken.

7:52But I honestly, you know, for me, I think humans are incredibly resilient. And I think that we can put up with a lot. And I think some of that comes from like Nigerian parents who grew up in a very different lifestyle than, you know, what many of us have today. But I think the toughest times that I'm thinking about twice in my life where I felt almost broken is when really something is wrong in the personal side of your life. and you also have this spike on the work side. Like I've had a million different spikes in banking and baseball and consulting, you know, in venture where like, you know, this too shall pass.

8:29I think what really is difficult is when you're dealing with that spike in a career sense, but you have something tragic happening in the personal sense. And so I think, unfortunately, dealt with loss of a parent early on in my career. And, you know, in one sense, there are times where you can sort of just bury yourself in work. But I think there's other times where you're trying to bury yourself in the work and you're realizing that the work doesn't matter. The things that matter in life, like all of us want to be really successful. I love what I do. I feel like I have such a privileged job to get to support these founders.

9:05but there's other times where you realize like you know your family your friends life are some of the most important things and um yeah yeah so i'm just thinking about a time like that yeah um

9:20Erica Wenger: how do you get through those hard times where maybe like work is demanding a lot of you you go through this personal moment i think especially founders so much of what is asked of you to build a company requires you to put a lot of the personal stuff on hold or navigate how to deal with hard personal stuff when work is demanding so much. What is your advice for someone who's trying to get through those really hard personal moments and what's worked for you? Yeah. This is going to sound a little bit like I'm speaking out of both sides of my mouth because in one sense, I think the idea of work-life balance just doesn't exist.

9:53Part of what makes me a good investor is some of my investments I knew through the personal side of my life. And I think that like when you're doing your life's work, work and life kind of just blend together. But I think what helps me sort of get through some of these things is by trying to build a wall for a little bit. And so even in the toughest moments of your life, like I remember negotiating a term sheet in the delivery room with my second kid. and like you're nervous you don't want to lose you really don't want to lose and you're trying to figure out like what to do here and then like you get shit on like literally shit on by from your baby yeah and it's just one of these moments where you're like oh that thing over there like yes it matters but also like i'm very present in this moment um or i like i remember another time where another tense work moment was happening.

10:50And my three and a half year old son, Jet, saw someone in the grocery store and asked me, luckily he asked me, he said, do you think that woman has a baby boy or baby girl in her belly? She was not pregnant. And you know, this is one of these moments where you're like, okay. It happens to every kid, by the way. Where you're like, okay, what do I do here? Is this a teaching moment where we try to explain different things? And it's just one of these moments too, where you like get pulled into the moment and you kind of forget about these other things. And so I think the thing is, is like when you're really stressed with work, try to carve out whether it's five minutes, whether it's, you know, an hour, try to carve out time to be present doing something that you really enjoy or that like takes a hundred percent of your mental focus.

11:38So you can't be multitasking and thinking like, I have this problem. My brain just doesn't shut off. And so when I think about the hobbies that I enjoy the most, there are ones where you sort of have to be in it and your mind can't be multitasking. And so I think finding ways to do that is a great way to build a separation, even if it's for a very short period of time.

11:58Erica Wenger: Totally. And it sounds like your family has also been an amazing anecdote for you, just to kind of like bring you back to the present moment. Speaking of hobbies, I do have to ask about this pilot license. I mean, I feel like you're a man of like many tastes and many passions, even just seeing your path before venture. but this pilot's license thing and you know i had sort of like asked our mutual friends and i heard pilot a few times like ask mecca he's low-key a pilot and i was like i'm sorry the same are we talking about the same guy so how did you get into it tell me more yeah i mean so much of like me today as someone who's too old you know was all driven from stuff at a young age and so when i was eight i think my first time on a plane was to nigeria for the summer we went there for three months.

12:41And I remember one, just looking out the window for hours and hours on end and just being like amazed at the magic of like an airplane. And then I remember listening, like United used to have these plugs where you could listen to the cockpit. And I just listened. I mean, these flights, this is a long way from Chicago to Lagos, Nigeria. And I just listened to the cockpit. And from that moment on, like I was obsessed with anything aerospace, aviation. Like I joked around, i told my parents i wanted to be a firefighter pilot when i was a kid um and so i think it kind of all just goes back to that um a friend got me a exploratory pilot's lessons when i was living in cleveland and this was in december like you you couldn't imagine a worse situation i'm in the ugliest oldest cessna 1952 like imagine a hoopty plane like a hoopty car with wheels with wings um and i took a one hour discovery lesson and it was cloudy and it was cold and it was bumpy and And like Cleveland is not exactly the most scenic place, but I was like, I was in love.

13:40And I was like, whenever I have the resources to do this, I'm going to get my pilot's license. And so years later, after business school, before I started Bain, I had three months off and I was like, what do I do in these three months off before my work starts? And I was like, I'm going to go get my pilot's license. And so five days a week, I'd go down to the airport. I'd watch other people fly. I'd study. I'd take flying lessons. And, you know, from there, I just got hooked and started, you know, got my pilot certificate, then got my instrument rating, then got my commercial pilot certificate, and then I got my seaplane license.

14:11And so, it's just been this thing that I really love. And going back to these things about your hobbies where you have to be fully present, like when you're operating a 10 ,000 pound machine, like you want to be fully present.

14:21Erica Wenger: Where your life is in jeopardy, by the way. You fall asleep, bye. And not only your life, but everybody else's life, your passengers' lives. And so... Do you fly people? Yeah, I fly my family to Tahoe oftentimes. I fly friends to golf trips. Okay, you're a good connect to have. I see, now I know. One of my investments, I was talking to them on a Friday. I flew the next morning down to meet them, brought them to an apartment meeting on Monday and closed the investment. So it's a useful thing in life. It can be a useful thing in work. And it's just something that brings me peace and calm when you're at 30 ,000 feet and just looking around and listening to air traffic control.

14:57It's pretty special.

14:59Erica Wenger: I love that. Yeah, you don't need a PJ when you can fly yourself. Exactly. And by the way, these planes are like very rudimentary. It's not super fancy. But still cool. Very cool. Still very cool. And I think one thing that when I look at your background and I think one thing we kind of talked about was how maybe some of this like deep tech stuff feels a little bit different than what you've done, which we'll talk about. But actually, if we get back to the root of your passions, a lot of aerospace and giant machinery in the air, whether or not it's a rocket ship or an airplane, that is your passion.

15:30Erica Wenger: And you're kind of blending that a little bit, at least how I'm projecting here, but blending that with your love for and strength at being a good investor. You know that. I mean, I love just being at the airport, even if it's just I'm not going to get to fly. I just get to watch other people land. I just get to go and walk around and look at other people's airplanes. I get to talk about sort of the engines, the avionics and all these systems. Like I'm just a naturally curious person who likes to understand how things work. And I think airplanes are very, like in one sense, they're simple, but in another sense, they're very complex.

16:00And I love, like each one is a new puzzle and I love seeing how it works. And I also love meeting other owners. Like there's this community of pilots where like, if you meet a pilot, like you could just have a conversation. You feel like you've known them forever and you can just talk for days. and they can talk for days about their favorite airframe and why they like it and the favorite airplanes or trips that they've gone on with friends and family. And so, yeah, it's that natural curiosity to me. It's the same thing where I was an econ and finance major at Princeton, but I took most of my electives in mechanical and aerospace engineering just because I just love how things work in the physical world.

16:37And I think the other thing too is, I don't know if it's the Midwest in me, but I love investing in things that are relatable to the average person, that make difference in life to an average person. And maybe you have to explain why, but as I was doing more of this investing where you could say, because this product exists, we are safer as a nation, or because this product exists, Like we may have less greenhouse gas and these remote island chains now have clean baseload energy. Or these troops who are overseas now are slightly better protected. Like those sorts of investments, again, and, you know, it's just the mission orientedness of the founders.

17:21It's the fact that I feel so lucky to be a citizen of this country. It's given me so much. and being able to work with founders who are oftentimes giving back to our country, I think is just like a really special position to be in.

17:34Erica Wenger: Yeah. I love how you're tying it to a lot of the mission because I do think that that, especially when you're starting a firm, is so much of it. Like, can you wake up every day and just like brunt force, make it happen? What's been your relationship with space? I mean, we talk a little bit about like airplanes, you know, it's just under space. But like, did you, I'll always love like space or astrology, astronomy, no, astronomy.

17:58Erica Wenger: astronomy rocket ships yeah like are you like the person that's going to like the crazy like blue origin launches like what's been your relationship with space which is sort of like the next yeah i would say space was always you know uh if if aviation was a 1a space was a 1b like as i was building model airplanes and flying them i was also launching model rockets I think now and in this moment, I think space is just going to be very important in every product and service that gets delivered. Like, I don't know if you've been on a flight since Starlink has been... It's game changing. I mean, it's just like, I flew out here on United, the internet didn't work.

18:37I had five hours of refreshing and like that product experience was not great. And you get off a flight with Starlink and you can just see like, wow, this already magical experience of like transporting 500 knots across the ocean. Now you're like fully connected to all of your friends and family or work or streaming whatever TV show you want to. Like that is just such a crazy thing that, you know, satellites are enabling. You know, there's right now, I don't know how much you know about Golden Dome, but like to have Golden Dome work, like a lot of that is built on space-based interceptors that are, you know, many, many miles above us, keeping us safe.

19:14And so to have this like personal interest now overlap with this like professional interest and overlap with like giving back, keeping us safer, delivering really cool consumer experiences. Like I just, it's, it's, again, I just pinch myself so many mornings of just feeling so lucky to do what we get to do.

19:35Erica Wenger: Yeah. I think that's the beauty of starting your own firm is it can become often the manifestation of what you truly want and who you truly are, especially when you do it solo. Talk to me. So obviously a lot of folks that are listening to this will know that you were at first round for many, many years. Why not pursue this mission at first round and instead start your own firm? I know there's so many factors that go into that. It's not an easy decision, but tell me a little bit about why pursue this with Prist instead of continuing to build out that strategy at first round. Yeah. So I think there are many ways to practice the craft of venture.

20:05And as I have friends who are looking at venture, I'm like, hey, this early versus late is very different. Leading versus collaborating is very different. Being a generalist versus being a specialist is very different. I think lots of firms have consensus decision-making models and others where you sort of need some level of votes to get something approved. And others have conviction where like any partner can do whatever they want. My thesis on inception stage deep tech is that conviction is the way to do this right. And I mean this for a couple of reasons. I'd say one, when you're looking at a business at Series A that has some million of ARR and you're trying to underwrite what this can be, I think it's really easy to have a good group conversation with seven or eight people.

20:53When you are looking at an off-the-beaten-path founder, building an industry oftentimes that no one's ever heard of, with a technical moat that may not be super crisp or super legible if you're not a PhD in astrophysics or if you're not a rocket scientist. It just gets harder, I think, to have a really educated conversation. I also think the product that you deliver to founders, when I sit across from a founder now, I can tell them exactly what I know, what I don't know, what I like, what I don't like, and how I'm going to make an investment decision. And it's so nice to see someone's eyes light up.

21:38And you've probably seen this in like your fundraising, where when you're dealing with sort of like the matriarch or the patriarch of a family office who's making a decision versus when you're dealing with an endowment with a 15-person investment committee. One's not better or worse, it's just very, very different. But when you're sitting across from a decision maker, I think that relationship and that bond that you build is like significantly different. I also think that in order to get one person to say yes on something, that path can be very linear. I can get to that path and sometimes it takes two days, sometimes it takes a week, but I have the ability to compress it and deliver in whatever timeframe.

22:14When you're making decisions as a group, you lose some of that control. You lose some of that agency. And I think the ideas and the founders that I want to back look very wacky. And every once in a while, I'm going to look like a genius by backing these founders. And every once in a while, I'm going to look like an idiot. And I think that in order to do that well, in order to take the risks that I want to take at inception stage in founders, I think the way to do that most effectively is on your own and early. And that's before we get into just like how the venture landscape is shifting and how funds are getting bigger and these$50 million,$100 million,$150 million seed rounds.

22:55like i'm really passionate about writing small checks in early stock founders like as early as possible literally like they just left their company or they're thinking about their company it's like hey here's money to get started here's money to go hire the first person um that's what

23:08Erica Wenger: gets me out of bed yeah i love that it's it's you're so right it's a combination of like your interest as an investor and then also the larger venture landscape and like where you want to play in that because you can make money a lot of different ways the question is just like where do you want to spend your time and now that you've like earned a great track record it's really just question of like how do you want to play it yeah and i think what's what's really hard to understand like venture the venture landscape is very different in 2021 than it is today and i'm sure five years from now it's going to look insanely different like the the fact that we're having trillion dollar outcomes like we didn't even comprehend that several years ago that's justification for the multi-stage though you know it is yeah and i i really do think that um i think we just saw this on a different podcast where a multi-stage gp talked about seed being option value.

23:54And that is why these really big seed and these really consensus founders are not an area I think is... I don't want to compete against Andreessen or Menlo or Lightspeed or Benchmark for consensus founder A, who's fresh out of Anderle and going to sneeze and raise$50 million. And so I think the way that you... I think a very effective way to win and a very effective way to marry that ability to win with what I enjoy doing is going after this pocket of founders who can't just raise 50 out of the gates, who are chasing industries that a lot of mainstream VCs look at and say, that's a little weird.

24:33Let me wait a year or two and see what it looks like as it's cleaned up and as it's polished. And that's the area where I nerd out on, I geek out on, I want to understand how the founder figured out that there was an opportunity that they could sort of like really sink their teeth into. Like, why is this their life's work? Why are they going to spend the next 20 years doing it? Like all those things. Like I'm a people person through and through. I think one of my biggest strong suits and what makes me good at venture is that I've just been in a bunch of different organizations with a bunch of people shaped in different ways, but who are all like, I think I've seen excellence in a lot of different industries.

25:10And so what I'm pattern matching against is like excellence in baseball, excellence in early stage technology, excellence in late stage enterprise technology, and excellence sort of of what I got to see at five years of first round and seeing, you know, thousands of pitches. And so my job, again, is just to meet these people who are putting their life, all of their blood, sweat, and tears into building something and figure out like, where do they map on this excellence scale? Where is the Y intercept and where is their slope? And then also, have they chosen an industry that structurally can support a venture scale outcome?

25:42Erica Wenger: Yeah, I think that last point is really important for the like very exciting and hypey moment that this like frontier tech, deep tech, physical world stuff is having. So I want to do kind of a spicy question. Jay Malik, who did Countdown, I'm sure you know him. He, you know, did like, I want to say like a$3 million fund and then like a$15,$20 million fund. And then he wrote this letter, maybe three years ago, where he said, and I don't know if you know the letter I'm referring to, where he basically said like, I have to stop my fund. fund I don't see an early stage hard tech fund being able to compete with like the founders funds and the luxes and the you sneeze in your first round 50 million folks and so he actually like completely paused his fund I think he actually even like stopped calling capital and uh just sort of like managed what he had and this was kind of like a ripple through the ecosystem because even though you know like deep tech wasn't as hot as it is now it was definitely getting there and I think there was a lot of geopolitical reasons why.

26:41Erica Wenger: And he had this hot take of like, actually, it's really just these giant capital intensive rounds that you need. And there isn't room for that pre-seed hard tech. What's your take on that? Have things changed? Yeah. Do you disagree? Do you agree in some ways? I'd love to get your thoughts. Because I think you're doing something truly contrarian. Yeah. But it's an uphill battle. Yeah. So I would say things have changed since I wrote my first deep tech check in 2022. 2022. You know, at that point... Was that K2? That was K2. Okay, we'll talk about that in a sec, yeah. But at that point, whether or not the downstream capital markets would fund these ideas, I think was still a question.

27:19There were definitely outfits who were doing it, but it wasn't every single mainstream Sand Hill Road firm was writing a check. You know, Benchmark Today wrote a, I think,$25 million seed round check into Furiantis. That was not the case in 2022 when I started doing Deep Tech.

27:33Erica Wenger: And KT did K2's last round, right? Yes. Yeah. I mean, as institutional as it gets, yeah. Exactly. And so I think the countdown letter is slightly right in that things are very frothy in hard tech. And things are very frothy in AI. Markets get frothy all the time and then they come back to reality. And I think just because markets are frothy does not mean you should exit the market. I also think I'm intentionally choosing to play at a place where the froth, it still exists, but maybe it's not overflowing. And so what I love about this moment is that But there are lots of founders who've been doing deep tech hardware for their entire careers.

28:11I think there are also founders who are coming from other slices of the world and saying, these are the biggest problems that need to be solved. I'm going to go build here. And sometimes that person who is new-ish to the space doesn't have the ability to raise 25 out of the gates or even 10 out of the gates. I've seen so many talented teams who can only raise one or two out of the gates. And like that - Is that enough? Yes. And the reason it's enough is because I ask every founder a question. I say, how much are you raising and what are you going to do with it? And my hope is that they de-risk the company on the team side, hiring people that are going to close the gaps or start to build what they need to build.

28:50On the customer traction point, hopefully getting some LOIs. And then on the technical front, building a small version of the thing or building the most complex piece of the puzzle there. And I think oftentimes when you ask that question, you'll hear whether or not the money that they're raising is enough to make progress across enough of those domains that it unlocks capital at 3X, 4X, or 5X, that X valuation. And so the last thing you want to do is back this really wacky idea where you're like, oh, you can't de-risk this company without$10 million or$50 million. Those kinds of companies I usually stay away from.

29:32But there are so many companies where you can really start to bring things, burn down risk across all these categories where all of a sudden, 12, 18, 24 months later, the company looks entirely different. And this category where people are like, I don't know, or on the macro side, it was a little early. All of a sudden, it's like, nope, this is squarely unfocused and all these people are throwing money at the category. And so that's what I need to do is find those founders who can de-risk the company on a reasonable amount of capital and prove to them that like i am the person who's best fit to help them continue on that journey totally i actually

30:10Erica Wenger: think too i'm sure you probably know like the team at abstract but they do this like really interesting strategy i'm sure you know we're like help you get to that next round and they're saying i think there's something really interesting there like for those who can be that bridge whether it's from like c to a a to b pre-seed to c whatever and you're known for being that bridge and like a very clear sector i think you can actually have like a lot of alpha like if you're like we're your pre-seed seed person and then we help you go to the A. Yeah, I think that can be really strong, especially where like in very hype markets where everyone and their mother is doing deep tech right now, like who's actually helpful, who actually has capital to pour into.

30:40Erica Wenger: I think that could be really interesting. I want to talk to you a little bit about the archetype of founder you like. Yeah. So technical founders, like look at your bio and like I look at all the places technical founders is like the words you use. How do you think about like the need for technical founders versus non-technical founders in specifically deep tech and why focus on technical founders who often, as you know, focus more on product and engineering, but maybe need a little commerciality help? Yeah. I mean, the secret sauce, I think, to where I've invested well is actually where there's a technical founder and they either pair themselves or somehow they themselves have really good commercial judgment.

31:15And there's also something about these technical founders where if you want to nerd out or if you put an expert in their field, they can get into the nitty gritty and spar, go blow for blow with these people. But I can sit there and be like, hey, talk to me like I'm in fifth grade and explain why this opportunity exists. And they do a really good job of simplifying it. And I think the K2 founders had that in spades where like, if you talk to Karan and Neil, like it was clear how many years of space experience, you know, was sitting in that team. But also for me, having never really thought about satellite buses on my first meeting, I walked out of the first meeting being like, oh, wow, that just like logically makes a ton of sense.

31:52This company needs to get funded. And so you really like, I think it is, I don't think I could ever back a founder where I don't believe they're either going to grow into that commercial mindset or hire that commercial mindset. But I think most of the time, and especially with folks who are coming to me, I think they understand that I care about that. And a lot of the questions in the first pitch, I want to know about the tech. I want to dig into the tech. But I also know that I'm not going to out-nerd the nerd at the thing. And if that's my way to underwrite, I'm going to lose a lot of money.

32:24Instead, I have to be zooming out and figuring out, okay, I am going to do this technical work and technical diligence to figure out if it passes muster. But I'm really going to focus on like, is this a massive commercial opportunity where they can also build sustainable moats over time that accrue and that create venture style businesses?

32:40Erica Wenger: Yeah. It's so funny. As you just were talking about K2, I realize we haven't gotten into like the actual story of it. Yeah. So we got to run back a little bit. K2 is an evaluate at 7 billion plus. It's a little more than that. You were the first check into K2. Yeah. How did you find them? How did you get a conviction? And then also, most importantly, how did you convince first round to do this crazy space flyer bet in 2022? Yeah, 2022. So I actually had met Karan a couple of years prior. He was leaving BCG and looking for a job in tech. And my old roommate actually introduced me to him and said, hey, you left Bain and went to Stripe.

33:14I have a friend leaving BCG looking at tech. Can you talk to him? And so that's when we had our first conversation. Same pipeline.

33:21Erica Wenger: Consulting to tech. Exactly. Exactly. And so years later, he reached back out to me and said, hey, I'm starting a space company with my brother. Do you want to chat? And I was like, hey, I don't really know much about satellites and first round doesn't really do a lot of deep tech, but I'm happy to take the pitch and I'll give you the feedback that you're going to hear from a lot of generalist software investors. Because as you go out to Sandhur Road, even if there's someone that you're talking to who's a deep tech specialist, they are going to need to convince their mostly software investment committee to do this deal so i took a first meeting with them and i was like huh i'm either really dumb and like i don't get it or these guys are really on to something because what they say makes a ton of sense and their pitch back then was that for most of history people have built satellites that are really small and really lightweight because the cost of launch to orbit is really expensive their premise was that spacex was going to have a new platform starship that was going to drop the cost of mass to orbit.

34:19And so as you think about this mass abundant world, you would completely change how you design satellites. These satellites would be much larger, much more high power, fly at higher altitudes and unlock missions that were not possible before, either because of power restraints or because of cost restraints. And so building this platform would really unlock and supercharge this whole space ecosystem. And that many of the primes wouldn't act now because the platform was still years off and And most primes don't do anything until there's a program of record or like that platform is ready. So that like, there's more to it than that.

34:52But that was like the high level first pitch in a 30 minute meeting where I was like, okay, yeah, team makes sense. Market opportunity makes sense. Why now makes sense. And then you dig in and you dig in and do a whole bunch of research and talk to a whole bunch of, you know, former SpaceX colleagues and talk to people who are launching missions for NASA to understand what they would do if, you know, they could launch something that was significantly bigger or significantly higher mass. And I think what got that investment done was like one, Neil's brilliance on the technical side. Like when we did the bomb breakdown of what was going to go in the satellite and how they were going to drive the cost down, whether or not we talked about the most expensive item or the cheapest item, Neil could like talk for hours.

35:34And I was like, okay, dude, I get it. You really, really understand every little piece of this uh this satellite bus but i think what was really interesting was pairing that with quran where um i think his ability his his understanding of what it was going to take to take a two million dollar round at like i don't know 10 or 15 post and turn it into yeah it was a different time back then but in turn that into the juggernaut that it is today And when we're having conversations with, what are you going to do with the small pre-seed round? And they knew exactly who they would hire from SpaceX and which people would bring other really talented engineers.

36:16They knew exactly what sorts of folks in the space ecosystem would be excited about bringing mass. They knew what components were going to be the most critical to get right. And just seeing those pieces all come together, it made a ton of sense. And I think the beauty of it was a small round at a time where I was probably a third or a fourth of our normal check size given it was a small inception stage pre-seed. And so we did the investment. It's crazy because in 2022, that was the only investment that I led after doing seven enterprise SaaS deals the year before. But I got to spend so much time with that team.

36:52And what I thought was really unique at the time was anytime you asked them about what they were going to do, they would do it better and faster than you said. or every time they hired someone, it was like, how did you get that person or other people from SpaceX? But why is this rockstar going over to K2? Something really interesting must be going on there. And so I got to spend a lot of time with the team. I got to see a lot of the progress that year, especially because it was the one investment that I led. And that was a moment of reflection for me of like, why am I with no space experience able to lead this deal in obviously a very, very good company.

37:26And that's when I started to understand and see that this pocket, and I think it still exists today, even with all the capital that's flowed into the market, is this pocket of founders who's raising less than$5 million and doing something somewhat wacky. A lot of my friends told me, large satellites are dumb, small satellites are how it's done. And so some people thought I was stupid. And I think a lot of people told them what they could do was impossible. And I think that's also what attracted so many of the early engineers is people are telling us this is impossible, like, I'm going to go prove them wrong.

37:55Like, they were just so maniacally focused on that.

37:58Erica Wenger: And they want a challenge. Yeah, they wanted a challenge. And so that, that like, I see so much in, you know, what I learned from K2 and like, this impossible mission, this mission focused team. Like, I see so much of that in the founders that I, you know, continue to back in deep tech and that I'm, you know, backing now here, here at Princeton. It just like, when you give money to two people early, and then you go down to Vandenberg Space Force Base, and watch a Falcon 9 rocket launch with your company's satellite on it. And then they are flying sort of like one of the largest satellites at altitude.

38:30And it's like a ragtag startup that was just an idea. And now it's a massive factory with all these employees who are doing all these things with all these programs and partners. It's just really special to be like… I think about venture as these ripple effects where you throw a rock and the waves just keep going. And we are such a small part of the story. The founders and the employees, the customers, they are the real story. but it's really cool to think about yourself as just like this little person who like you know disturbs the water and then the waves just like keep coming and like i'm so passionate about thinking about like all of these different markets and problems where you can be the person that disturbs the water and starts these waves that just ripple off for a really long time and have real consequences in the world that we live in yeah it's very dicting i mean it's like you did

39:14Erica Wenger: it once and you're like what if i could do it again yes and what if the meeting you have today is the one that's the next k2 yeah you know i think that's so much of it i talk about as my red pill moment i always say i'm like that k2 was my red pill moment where it made it hard to ever think about writing a software check again and and like that is you know that's where you are where you are now that's where there you go um i want to ask you just a quick question about geo you know midwestern guy in your roots you're now in sf gundo's having a moment i'm from manhattan beach so like for me seeing else segundo on the map is like mind-blowing texas has had its moment yeah um tell me like where do you see this deep tech ecosystem booming most and where are you most bullish moving forward because if there's a founder listening to this yeah and they're like they want to build an xk2 where do they go yeah what's your advice i mean i think the the the right parallel is for a long time if you wanted to build a startup like you couldn't make the wrong choice by being in san francisco i don't think you can make the wrong choice by being in los angeles um i will say that i have a high concentration of founders in austin i also have a high concentration of founders, especially in the maritime environment in Seattle.

40:23I also think that something may start brewing in Detroit, especially as we think about just manufacturing, industrials, and supply chain. But I think the important message to anyone who has an idea is that these businesses can be built anywhere, or you can be mobile. If you have an idea, if you feel like you've been living a problem and no one has solved this problem for a really long time, and you feel purpose-built to solve the problem, call me, email me, let's talk about it. Like that is what this whole ecosystem is about. And this is why I actually love, like it's frustrating what's happening in pricing.

40:56And I think there's a little irrational exuberance, but the good thing is, is more ideas and more amazing people are getting funded. And that means we're going to live in a better society and a better place. And like, you know, that's a small price to pay for I think what's going to happen because of all of these ideas from talented people getting founded.

41:14Erica Wenger: Well, often it also will just like shake out the tourists and you can get back to building, which is what I think true builders want to do. What do you think is the most overhyped category right now in deep tech? I mean, there's so many and I won't like name specifics in case you have an investment in one of them. But like there's a lot of sort of like wacky flyer stuff happening right now. Tell me like what's the most overhyped where you're like, yeah, I just haven't seen anything that makes sense here. So I would say it's kind of like the like is AI overhyped or underhyped? It can be it can be overhyped and there can still be.

41:46Erica Wenger: So you prepared for the question that I wasn't even going to ask you. Yeah. I guess what I would say is, is I have seen so many counter UAS pitches. I believe... Counter UAS is? Sorry, counter drone pitches. And so people need to figure out a way to stop drones from blowing up humans and equipment. There are lots of different ways to potentially solve this. There are interceptors, there's EW, there are nets. And there's no shortage of new people with new... There's machine guns. There's no shortage of different ideas on how to solve this problem. I still do believe the problem is unsolved, but I'm saying it's overhyped because I think it's the category where if someone just wants to be a defense tech founder, this is the category they go in.

42:28And I've seen 50 copycats of the same idea. And so I do think this is a real problem with real dollars attached, where there are going to be several companies across all of the different sort of like deterrence methods that are going to be very, very valuable companies. But I also think a lot of investors are going to implode a lot of dollars into the ground in this category too.

42:49Erica Wenger: Cool. One final question. I could keep asking you a million, but I'm going to start with, on a very optimistic note, the future of Priss Capital. You know, you've been stealth. You've been kind of doing your own thing post-first round. Like, what can we expect from you going forward? And what are you most excited for for the next decade of Priss Capital? Yeah. I mean, there are already eight founders who I've had the pleasure to back. And like, I'm so excited about every one of those eight ideas and the impact that they're going to have, you know, on our world. I think what's really special about what I'm doing is I am willing to give the little guy or gal a chance.

43:28Like, I'm this Nigerian kid with a funny name from the South Side of Chicago who somehow made his way into venture and now is a solo GP. and I would not be in this chair without a bunch of different people taking chances on me. And so no matter how wacky your idea is, no matter how non-consensus your background is, if you are mission-driven, building in the physical world, in an opportunity that is massive, I want to talk to you. I want to see if your idea has legs. And even if it's not for me, I want to introduce you to my other friends who do this kind of investing as well. And so I'm just excited about sort of being this lighthouse on a hill that says, hey, if you have an idea, like, come talk to me.

44:10I'm very open minded. Like, I've done geothermal, I've done space, I've done aviation, I've done defense, I've done maritime, I've done industrials, I've done manufacturing, like, in all these categories, I didn't have a ton of experience in them before I wrote my first check. And so I'm an open-minded person who's willing to listen to really smart people educate me about the industry and the opportunity that they have. And I will do my best to give real feedback of what this dumb mind is thinking and what other people may be thinking. And hopefully, even if I don't get there, you will have learned something valuable from our interaction where I'll introduce you to someone.

44:43And so I just want Prist to be accelerant capital in people who are thinking about building businesses of consequence.

44:53Erica Wenger: I love that and no early is too early I mean there's no such thing it's too early no such thing it's too early love it Mecca thank you for being here this is really fun thanks so much for having me this was a pleasure thank you