Hype Pod - The Hype Network Podcast

Arun: Welcome back to the Hype Podcast.

FloCon is right around the corner.

Pastor Vance, what can you do
to give me an elevator pitch for

Vance: FloCon?

My goodness.

This is for kingdom minded entrepreneurs,
innovators, makers, creators.

This is also for people that are
vocationally building the local church.

What happens when you get about a hundred
kingdom minded CEOs, entrepreneurs, VCs,

combined with pastors and church leaders.

I think what happens is that we are
going to create innovations for the

future to build the future of the
church, to build the expansion of the

kingdom together through innovation.

And so that's what FloCon is.

It's the first time we're ever doing
it, but there has been so much interest.

We're literally almost sold out.

And so people gotta go to overflow.

co slash FloCon to reserve your ticket.

Like literally right now.

If

Arun: this is your first time
hearing about Flowcon, please

get out from the rock you're
hiding under and go to overflow.

co slash flowcon for more
information and to register.

So over the next few weeks,
we're doing something really

special on the Hype podcast.

Um, we want to give people a taste
of what's to come at Flowcon.

So we're doing a special
rebroadcast of some of the most

requested, um, Hype sessions.

That's right.

From Amen Conference's
Hype event last year.

Um, so to start, we're kicking it
off with the values and valuations.

session.

Um, on that panel, we had some
incredible, incredible people.

That's right.

We had Charles Shannon.

He's a member of Vive Church
since He's a partner at Founders

Circle Capital, which is a growth
stage venture firm based in SF.

, we had Chi Hua Chen, co founder and
managing partner at Goodwater Capital.

And then we had Hypod's very own Pastor
Vance, um, co founder and executive

pastor at Vive Church, as everybody
knows, and founder and CEO of Overflow.

All of this was, uh, hosted
by the Hypod OG, Katrina.

Pastor Vance, tell us a little bit more
about your expectations going into that

panel and what you took away coming out of

Vance: it.

Yeah, it literally is the most
requested, uh, you know, hype

podcast that we've ever done.

Literally in the room, in the hype house.

That was special, huh?

We created a hype house in the parking
lot of the church, and the first time

we ever did it, and it was electric.

I think I was most blown away
by how front footed people were.

In that session, leaning in, I was
blown away by how many actual founders

we attracted from all over the world.

We had people literally in the room
that flew in from Brazil, that flew in

from Miami, that flew in from New York.

Uh, just hearing about what God is
doing in the Silicon Valley through

the hype network and through this hype
movement, if I could say it like that.

And when, you know, some of
the best of the best, right?

I

Vance: mean, Charles Shannon, uh, not only
does he serve in the local church here at

vibe, but literally is one of the check
riders into companies like Robin hood.

Hello, somebody.

And then you got, uh, our friend Chiwa,
who literally has probably one of the

fastest growing VC firms comes previously
from Kleiner Perkins, Kleiner Perkins.

Right.

Wrote one of the first checks into.

Companies like Facebook, right?

So this is like people at the top of their
game that love the Lord, that love Jesus.

And that's what we called it, right?

Values and valuations.

You know, we can be so
focused on chasing this.

Valuation that we forget that actually
it's all rooted in kingdom principles.

It's all rooted in values.

If it's going to sustain, if those
valuations are going to sustain,

it has to be rooted in values.

And so I felt like in
this session, we gave.

Silicon Valley insider knowledge.

I felt like we gave some insights
and, you know, it's been gated for

this past year to just members only.

By the way, if you want this
exclusive content at the tip of

your fingers, go to hypemembership.

com and you can always have it.

We're unleashing it.

We're unleashing it for
the very first time.

So we're really excited for the

Arun: rebroadcast.

Yeah, so whether you're an
aspiring entrepreneur, a seasoned

investor, or someone fascinated
by the intersection of faith and

finance, this episode is for you.

So get ready to be inspired, informed,
and perhaps, Even a little challenged,

as the episode explores what it
truly means to build with values

and aim for valuations that reflect
more than just the bottom line.

Vance: Let's dive in.

Ps Adam: Hey, I'm so glad that people
come from all over the globe to be

here in the Silicon Valley for Amen
Conference and Hype Sessions, and, uh,

I really want to just set a tone of
prayer before we introduce the panel.

So would you pray with me?

Lord Jesus, we are so
hungry for an acceleration.

Lord, we want a deposit of wisdom.

That's the appetite of our heart, Lord,
that we can just get some knowledge

today, and as we apply that knowledge,
would it become wisdom in our lives?

Lord, not just for us.

But for others around us, would you
increase our sphere of influence?

And Lord, I'm just so thankful
that we get to be here in the room.

Would you be blessed?

Would you be glorified in Jesus name?

Amen.

Amen.

I want to make one mention
before we get into the panel.

And, uh, I'm so thankful for all
the sponsors that we have here.

The sponsors of Hype House today, and
specifically this session, uh, Vest

Fund, who have been ultimately underlying
this whole thing and underwriting

everything hype and just such a belief in
innovation, entrepreneurs, and founders.

And we wanted to hear from a founder
in particular, Michael Whittle.

Could you bring up,
welcome Michael Whittle.

He's going to come up, Michael,
who is the founder of Vast Media.

And, uh, you've been invested in by Vest.

The first check in and, uh, I just
wanted you to kind of let everyone

know, what does that feel like as
a founder to get that investment?

Like, I mean, that's a big vote of
confidence when you get an investment in.

But as a founder receiving that
check, what does that feel like?

Um,

Michael: like you're not
crazy in some ways, right?

Like this experiment that you've been
working on in your head that somebody

Chi-Hua: actually says, Oh,
this idea could actually

Vance: maybe become a business.

Um, so that was huge.

Um, that was a huge first step for me.

I remember when like getting the

Chi-Hua: wire going,

Vance: this is awesome.

What have I done?

Like all, all at the same

Chi-Hua: time, but going,
maybe we're onto something.

So that was, that was a huge, huge deal.

Ps Adam: And so, I mean, getting
that investment is key for the

confidence factor, but what does
that investment allow you to do

as far as the company's concerned?

Chi-Hua: Yeah.

I mean, it, it, well, what it

Vance: allowed me to do was put
all of my focus on this business.

Um, and I had been probably for the
previous 12 months, just gathering.

Partners and people and
all kinds of, of things.

When this happened,

Chi-Hua: I could just
essentially make everything

that I had been building happen.

So

Vance: it was like immediate execution.

Um, like.

Starting day one.

So that was huge.

It was all about focus

Ps Adam: and you guys have
been scaling massively.

You've been growing.

We have.

Yeah, expanding and tomorrow night.

You're actually doing a showcase.

Is that correct?

I am one of the showcase
companies tomorrow night.

So you're going to be able to hear
more about vast media tomorrow night.

But let's give it up for Michael.

Let's give it up for vest fund
and appreciate them so much.

All right.

Where are we at?

Let's bring up the panelists.

Can we do that?

As all the panelists come up,
Katrina, would you come up?

Yeah, give them a big hand
as they take the stage.

They get to be in the hot seats tonight.

And as I said, uh, get ready with
some questions as we're, uh, kind

of going through this evening.

And, um, we're going to
make this incredible.

But, um, yeah, Katrina, you
want to introduce the panelists?

Oh, there's your mic.

Katrina: Okay, awesome.

Who, who ended up winning the AirTags?

Who was it?

Oh, I feel like that was

Vance: easy.

Ps Adam: What do you mean it was easy?

They had to come 13
hours on Spirit Airways.

That's not easy.

I don't even think Spirit has first class.

I think they don't even
have business class.

Oh my gosh.

Katrina: Well, I know all of
you have been really excited to

come to this particular session.

This one is called Values and Valuations.

And so we've got an amazing panel here.

The Hype House has been vibing all day.

So, um, we're gonna get into this.

Is that okay?

Awesome.

. Charles Shannon.

You guys know, if you go to Mountain
View Campus, you know Charles Shannon

is one of our kingdom builders.

How long have you been at Vive?

2015.

Charles: Okay,

Katrina: I thought you
were going to say 20

Charles: years.

Yeah, I was here before
Pastor Adam, no, no.

Yeah.

2015.

Katrina: So, um, Charles, I know that
you were in investment banking at

Morgan Stanley before you were in, um,
the particular places you're in now.

You're going on, um, 10 years now
in that space of finance, right?

Yup, yup.

And, um, you're currently
a partner at Founders Bank.

Circle Capital, it's a venture
firm based in San Francisco.

I know there's a really great
story there, but, um, would you

tell real, tell us really quick
in about a minute, what is Founder

Charles: Circle about?

Oh, for sure.

So Founder Circle is a late stage VC firm.

So, uh, anyone seen them
seeing the show Shark Tank?

Shark Tank?

Okay.

So we're Shark Tank, but just later.

So you've, you've been around a little
bit longer, you've scaled your company

and now you need to raise more money.

Kind of where at your growth
stage, you figured everything out.

Now you need to scale.

That's where we come in.

Uh, we've got about a billion in AUM
across four funds, uh, kind of cover

anything that we can understand.

So software, consumer, FinTech,
healthcare, you name it, we'll look at it.

And, uh, yeah, we kind of
write, write checks and invest.

Invested into?

Uh, lots of companies, uh,
companies like Robinhood, UiPath.

Uh, Databricks, uh, Ebates, uh,
Pinterest, uh, you name it, we kind

of, we've kind of invested in them.

Awesome.

Katrina: So then we've got to
watch and right here on again.

My right.

Um, she was the co founder and managing
partner at Goodwater Capital, the largest

consumer tech focus VC firm in the world.

, Goodwater manages over three
billion of committed capital.

It's exciting supports a family over
600 seed venture and growth stage

startups spanning 51 countries.

Do you want to talk about
good water real quick?

Chi-Hua: So, uh, we started this firm
almost 10 years ago, nine and a half

years ago, uh, with a really simple
idea, which is that consumer technology

is the most powerful force on earth.

It's shaping global culture and
transforming the global economy

in really unprecedented ways.

Like, think about everything you
hold in your hands and all the

apps that you use every single day.

None of that existed 15 years ago.

It's crazy to think about that, right?

And so we built a dedicated firm
that is enabling entrepreneurs

all the way from seed stage, we
got 700 seed stage companies,

through to growth stage companies.

We'll write a 150 million check to
help you get through to that last stage

as you're getting ready to go public.

And these companies, they really
build the digital infrastructure

for seven key categories.

Housing, healthcare, food,
financial services, transportation,

education, and entertainment.

And those seven categories are the
categories of human flourishing.

Right?

If you don't have housing and
healthcare, you're in a pretty bad spot.

You don't have food,
you're probably not alive.

If you don't have
transportation education.

You're not accessing
opportunity around you.

If you don't have entertainment,
it's kind of boring.

So that's what we do.

And we do it globally.

So that portfolios in 50
countries around the world.

Katrina: Yeah.

Awesome.

And you're a Stanford alum, aren't you?

I am.

Yeah.

So it's very, okay.

Awesome.

Just pouring back into the area here.

All right.

So then we've got, um, pastor
Vance Roush to my right.

Awesome.

Pastor Vance is the founder and
CEO of Overflow and on mission

to inspire the world to give.

Specifically, Overflow unlocks
unprecedented levels of generosity by

empowering nonprofit foundations and
corporations to accept non cash assets

like stocks and crypto with ease.

I'm gonna let you talk about Overflow.

I know some people are familiar
with it, but Let's familiarize

everybody with Overflow.

Vance: Yeah, so we're a fintech platform
aimed at inspiring the world to give It's

built on the biblical proverb Proverbs
11 24 the world that the generous

gets larger and larger So we have a
conviction that if that's true if we

believe what the Bible says Why would we
not want to inspire every single human

being on the planet to be generous?

And so we want to build an iconic Uh, that
does this through financial technology.

Katrina: So exciting.

Okay, awesome.

And you probably saw Pastor Vance
also on the Hype Pod earlier.

If you want to hear, he's going to
be doing another, um, panel with

us tomorrow on the future of money.

So you can come back tomorrow.

So it's going to be really great.

We're talking about values and valuations.

What we want to give the room today, as we
talked about earlier, is just some tools.

I want to know from you guys, both from
the investing and the founder perspective,

what are we looking for when you're
looking for a company to invest in?

So give us the goods.

Let's start there, and then
I'll cut in if that's okay.

Vance: We should start with
Charles, because I've been

asking for money for three years.

So I want to hear the answer.

Charles: Okay, so Charles, you start.

Absolutely.

Absolutely.

And that's a true statement.

Uh, so, um, Have you given him any yet?

Not yet.

You're, you gotta do the first check.

Remember, like, you're earlier.

No, you're earlier.

And then, and then as
he, then we, this is how

Chi-Hua: this works.

What does Vance have to do to earn a
check from Founders Circle Capital?

Charles: Exactly.

Exactly.

He needs to, he needs to
get money from Chihuahua.

Uh, so, so, so, uh, if you're taking
notes, I use the six M's, the six M's.

Okay.

So first M is market.

Gotta have a big market.

Uh, and if you don't have a big market,
then you're not going to, uh, get an

outside, a third party funder interested
in investing in your company, because

remember, they're going to have a small
percentage of invest, uh, ownership.

And so the market has to be big enough.

So first one is, is market.

Second one is management.

Uh, you have to be a compelling,
a passionate, a driven

founder and entrepreneur.

If you're not excited or engaging,
how are you going to engage me?

Uh, so you gotta be, you gotta
be skilled up and persuasive.

Third M is moat, M O A T, uh, it's
literally, how are you differentiated?

Why can't I do what
you're doing right now?

So what about what you offer
is different from someone else?

Fourth M is margins.

So what are your margins?

What is the, what is the
profile of your company?

Are you profitable?

Are you on a path to profitability?

Uh, metrics, what about your
company makes your company amazing?

Is it because it's growing fast?

Is it because it's engaging customers and
customers are excited about your product?

Uh, what about your company?

What tangibly can I see that makes your
company so interesting and engaging?

And the last M if I'm at, if I'm
counting right is multiple, which is

ultimately, how do I actually value you?

Like, what's your evaluation?

When, when I look at those first
five M's and I take a step back and

I say, okay, based on all that, what
are you, what are you actually worth?

Uh, and that, that, that, that, that's
a loaded question, but ultimately that's

what we're looking for, those six M's.

Which one's the most important?

Ooh, which one's the most important?

So when you're earlier, the

Chi-Hua: first three.

We know Vance didn't

Charles: have the second one.

He definitely didn't.

Oh, yeah, that was like a, I was like
a, who else is on the management team?

Uh, to, to make sure.

I'm just joking.

He's an amazing guy.

If you don't know him, I love him.

Uh, no, so, so when you're early
to, uh, the first three matters.

So, big market, uh, management team, and
what's, what makes you differentiated?

When you're later stage, when you're
around my stage and I care more

about your metrics, your margins,
ultimately how to value you.

Chi-Hua: Yeah, I'd agree that.

I just add one thing.

When you're early, a lot of
times people are like, Oh,

your market's not big enough.

You're not market's not big enough.

But at the very earliest stage,
oftentimes you have a tiny market

that's growing incredibly fast.

And that's a unique
entrepreneurial insight.

As an entrepreneur, you see
something that no one else sees

and you see that this market.

It might be streaming music.

It might be electric cars.

It might be college social networks.

None of those things were markets
that you could measure at the time

that those companies got started.

But you see something
that no one else sees.

Now, at the later stage, you gotta be
able to prove the size of the market.

But the early stage, it's really
that insight that'll drive you.

When you

Vance: say early stage, Shu, are you
talking about specifically pre Seed,

Seed, or are you even talking about A?

Seed,

Chi-Hua: A, sometimes even Series

Vance: B.

Okay, and then so when you talk
about tiny markets, there's

also non existent markets.

Airbnb?

For example, um, might have not
been a market at all, depending

on how you looked at it.

Is that more of an exception
than the rule, or does that

Chi-Hua: actually happen often?

No, that's a great question.

A lot of, a lot of times markets like
Airbnb, while the market for a random

stranger to rent a room for you for
a night didn't really exist, the

hotel market was really, really big.

And so that was an adjacency, and
what Airbnb had was they said, Hey,

It'll be a third the price of that
hotel room and you have a friendly

person there to talk to you and make
you breakfast in the morning, right?

So sometimes these adjacencies are
where markets can really pop up.

Katrina: That's awesome.

How many founders or CEOs do
we have in the room real quick?

Could you put your hand up?

Oh,

Charles: wow.

That's a lot.

Okay.

That's awesome.

This is my pipeline.

Okay, this is great.

Yeah.

Ps Adam: We're just making a
funnel for you, Charles, okay?

I just

Vance: wanted to make sure.

You're

Charles: welcome.

Vance: I was doing my job

Ps Adam: for me.

Yeah, yeah.

Chi-Hua: One more time.

It's great.

How many would quit your job and become
a founder if you had something that

you were excited about, inspired to do?

Okay.

Oh wow, that's a great, awesome.

It was the same

Vance: hands.

Ps Adam: Same hands.

It was the same hands.

They're gonna quit their current

Chi-Hua: company.

They're looking for a better idea.

Charles: That's

Katrina: awesome.

Okay, so, great.

Thank you for the practicality.

What does it take to get your attention?

Like to get a meeting with you?

What would it, like if someone had to
give you a two minute, what actually

makes you book a meeting with them?

Chi-Hua: So, we're kind of unique, and
this may not be true for every venture

firm, but we generally, most venture
capitalists will say to get a meeting

with a VC, you need a warm intro.

Hey, that's what I was going to say.

Oh, okay.

Alright.

So, if you want to meet Charles,
you need to be here and come

up and talk to him afterwards.

Uh, we don't do warm intros,
so we actually don't meet any

companies that are, or rarely meet
companies that are referred to us.

We're looking for companies
with proven customer traction.

And it could be really tiny.

It could be 10, 000 users, 5, 000 users.

When we invested in Musical.

ly, before it became TikTok,
had like 100, 000 users.

Really, really tiny.

42 people in Shanghai.

But it had that customer traction.

Because what did that tell you?

That tells you that product is working.

People want to use that product.

And so, for us, that's really the
thing, is do customers love the product?

Wait,

Vance: so are you searching for them?

Yeah, we're searching

Chi-Hua: for them.

And how do you do that?

Our system is unique.

We built a technology platform
that crawls the entire world.

We track 10 million
companies in real time.

We have 40 engineers and
data scientists on our team.

To give a sense of the scale of the
data that we collect, it's about

2, 000 terabytes of data a month.

And it turns out, if you actually go look
for all this data, you can find out how

many people are using a product, how long
do they use it, how often do they use it.

How quickly do they churn?

How much money do they spend on it?

Uh, and then we build machine learning
models across all of that to identify

the best performing companies.

Okay.

Vance: So Chihuahua hasn't found overflow
yet cause I haven't got an email.

Um, so can you guys give more, please?

Everybody just give now, give now our
graph is going to spike, um, a grass

in a spike, and then I'll get an email,
a warm email from, from Chihuahua.

If you want to meet people like
Charles as a founder, okay.

If you want to be people like Charles.

Warm intros actually do make a difference.

Charles: Their, their, uh, vast
majority of any company I take

seriously is through a warm intro.

Either through an existing relationship
or through a friend of a friend.

Uh, because I, my view is, uh, Venture
is just as about, just as much about

the people as it is about the product.

Uh, and you're building for a long time.

And so if you don't have a connection
and or, um, ability to reference

check the people you're working with.

Uh, it makes it really hard to, to engage.

Will

Vance: you, uh Hey Vance,

Ps Adam: real quick.

Yeah.

Just, cause we heard from the
VCs, but you're a founder.

Yeah.

You got funding.

Exactly.

How did you make your

Vance: own intros?

So, I joined an accelerator.

And so, whether it's like a Vest Fund,
or a Y Combinator, or an Accelerator

like that, they did provide a network,
because I came in as a pastor, right?

And I didn't have a baked in network, even
though we've lived here, we've been here.

We didn't have a baked in network of VCs.

I joined an accelerator and that
was actually pretty catalytic for us

because to Charles point, I was getting
a lot more responses to my emails.

I was getting a lot more
opportunities to get on meetings.

It took a lot of meetings,
but we got those meetings.

largely because of a baked
in network that we joined.

Chi-Hua: Um, Describe an accelerator
because people here might not know what

Vance: it is.

So, so an accelerator is,
let's take Y Combinator, the

most famous one, for example.

They will give you a little bit of
capital, maybe just a bit over 100, 000

for, let's say, 7 percent of your company.

And they'll put you through
a 10 week boot camp.

And so, you know, companies that
have gone through Y Combinator

are like Stripe, actually Airbnb
that we were talking about.

Um, and so these are some of the
companies that go through there.

And because of Y Combinator's proven
success through their accelerator model,

because they have subject matter experts
that speak into the formation of your

business, talking about things like
Chiwa was talking about, build something

that people want, get to that traction,
grow 10 percent week over week, because

they put you on that pathway, and you
can talk to subject matter experts.

People that see intros from a Y Combinator
partner are much more interested because

they know that they went through some
sort of vetting or filtering process.

Charles: Hey,

Katrina: so we're talking
about values and valuations.

I know this is unique that we're
talking about this at a church

conference, which is really awesome.

I love that this has been part of
our vision, but I want to have you

guys speak into what does it look
like to run a company with values?

Um, I know, not just faith based,
but you are kingdom builders,

and you're advancing the kingdom.

What does that look like for each of you?

Vance: Chiwa, I like yours, cause you guys

Chi-Hua: established it.

Yeah, jump in, let's talk about Goodwater.

Yeah, so, we have an
interesting founding story.

Um, I, I was called specifically
by God outta Kleiner Perkins

to start this new firm.

Uh, my f my co-founder, actually
Sohi, my wife is sitting here.

Uh, we were praying about a co-founder
and she walks downstairs one morning

and she says, Hey, you know, you really
should talk to your friend Eric, uh,

about starting this business with you.

I was like, oh, that's interesting.

I never really thought of Eric, so.

I'm thinking about it.

Turns out Eric had a prophetic
dream the week before that he was

supposed to quit his job and join
me and start the business together.

So my son hasn't heard that
before, so he was pretty surprised.

So we started actually first
with mission and values.

Before we started with business strategy,
we started with mission and values.

And so our mission is to empower
exceptional entrepreneurs everywhere

to change the world for good.

It goes back to that belief
that consumer technology is this

incredibly powerful force, but it
doesn't always get used for good.

Like, really bad things happen
in the world when entrepreneurs

use technology in bad ways.

And then we sketched out six core values.

Integrity, transparency, quality,
service, humility, and justice.

These values represent a picture of
the world that we want to live in,

the world we want to leave with our
kids, and having experienced the

build, the building of some incredible
consumer tech platform companies at

our previous jobs, we realized that
if you can incept these values, deeply

into a startup from the very beginning.

They will then go hire tens of
thousands of people who build

products that touch hundreds of
millions or billions of people.

And those values will end up in the world
through those products that are built.

And so the journey, it's been a really
interesting one because The first time

we went, you know, the huge Kleiner LP
had told me that they always, they would

want to back me if I ever did a new fund.

We show up with this slide deck.

The first two slides
are mission and values.

They look at us and they're like,
You're never gonna win any deals.

Don't you realize this is the
era of win at all costs, you

know, break everything to win.

And they didn't give us any money.

So we had to go actually find the
people who were willing to back a

new venture firm that actually put
values at the core before strategy.

But what it does long term, it's not
all bad news is you find the right

people who do want to partner with you.

You find the right teammates, you
find the right capital partners,

you find the right entrepreneurs.

When you have that conversation up front,
it actually cements that relationship.

It makes it so much stronger because you
know you're aligned on the thing that

really matters, not just the dollars and
cents that might or might not go right.

Vance: And you build with
enduring principles, right?

The Bible's undefeated, right?

The biblical values that we find
in Scripture are undefeated.

When we found the tenants of generosity,
biblically living it out here at Vive for

the past decade, we see that it's true.

Uh, in an up market and a down market,
we see that these tenants are true.

And so when you build on
that foundation, it lasts.

Katrina: How early in your relationship
with a founder or an investor

are you able to identify that?

That it is a good match,
you know what I mean?

I'd love if you have any stories
or tips around this to determine

that this is going to be a good
value fit or a bad value fit.

And are you able to see that right away?

Chi-Hua: It's super hard because
I'm living through a situation

where I missed it right now.

And what I would say is You know the
people who opt out right away, right?

Because the people who opt
out, they look at your values

and say, Hey, that's not me.

I'm all good.

You're all good.

We're not gonna work together.

The ones that are really hard to
catch are the ones that fake it.

And they're like, Oh,
yeah, I love your values.

I love integrity.

I love quality.

I love Transparency.

So he's grimacing at me because she's
heard the calls I've been on the lawyers

recently, you know, literally this week
We are tomorrow we're shutting down a

company where the founder stole millions
of dollars from the company and Falsified

all of his business metrics for a year
maybe two years and and I'm struggling

still with like how did how did we miss?

It how do we not see it?

I think that those are the toughest
situations when they actually

tell you they buy into the values,
but they don't But they don't.

They're faking it.

Katrina: Do you have any stories?

Did you want to jump in?

No, go right ahead.

Okay.

No, I was just going to ask
you from the founder's side.

Because we're talking about
the relationship between

founders and investors.

Charles: But yeah, go for it.

No, I was just going to say, uh,
just to piggyback off of that, it is

incredibly difficult, uh, not only
it's because a lot of times you have

to make a decision so quickly, right?

And so ideally you'd be able to meet
and spend time with the founder for

months or years or, or, you know,
years is way too long, but, but enough

time to really assess what's going on.

And, and again, like, just like VC
are salespeople, so are founders.

Uh, and so, you know, that's where
I think leaning on the Holy Spirit

and for discernment and for wisdom.

To make the right decisions.

If something doesn't feel
right, uh, hit a pause.

If something doesn't feel
right, take another week.

Uh, you know, the worst thing you
could do is, is invest in a company or

build a relationship with someone that
ultimately is not the right fit because

then you're gonna, then you're actually
working back a lot of, a lot of work.

Uh, and investment in time,
so it is really important.

Chi-Hua: And it's really important
because the average founder investor

relationship lasts longer than
the average marriage in America.

So it's like getting married, and
these processes, they run really fast.

You wouldn't think about doing
a two week roadshow to decide

who you're gonna marry, right?

But that happens in a
Series A all the time.

Ps Adam: So you're talking about
that length of relationship.

We heard from the VC side, the
fit, the, like the values that

you have, maybe I'm just kind of
leaning into the founders here.

You can take money from anyone.

What's the value in them selecting
the right investors from a founder's

perspective, instead of just taking money.

Is there certain money they should be

Vance: looking for?

Yeah, I mean, at some points
it feels like money is green.

So just whoever wants to,
you know, invest, invest.

I would echo what Chiwa says.

What I'm learning and what
I'm realizing is that these

are long relationships, right?

If you're signing up for a
VC backed entrepreneurship

journey, it is a 10 year journey.

Right?

Uh, 10 years towards any sort of outcome.

And so you got to be
really, really intentional.

Something that I found in our journey
are just, it might seem like little

things, but it's become significant
things as we continue to build Overflow.

Uh, we were blessed to be in a situation
where we started getting a lot of interest

in term sheets during a period where
Overflow was seeing a lot of traction.

And so we had multiple term sheets in, so
I was in a position where we could choose.

And one of the criteria I had, Was
I'm going to actually see in our

logs, which one of these perspective
investors has actually used overflow.

And in our seed round, there's only
one, there's only one person that,

that did it, that actually donated
through overflow to a charitable

cause that he was passionate about.

And I was like, you know, you, you can't,
if we're inspiring the world to give,

and I'm going to invite an investor to
be part of this journey, we can't take

people anywhere we haven't been ourselves.

And so the authenticity of him actually
using the platform, having feedback

about the product, I was like, cool.

This is at least, you know, not
a believer, but this is something

I can build a foundation on.

He, passionate about giving himself,
he'll use the platform himself, and it's

been, it's been working out really well.

Charles: Hey, for

Katrina: the founders of the
future founders in the room,

can you talk about what a good
pitch and a bad pitch looks like?

Yeah.

He

Charles: did it.

Uh, a good pitch has me wanting to like
turn the page before they get to it.

Uh, a good pitch is short a good
pitch is Uh leaving time for

me to actually ask questions.

Uh, and more than that.

It's actually a conversation Uh, because
we're talking about relationships, right?

So if we're actually building a
relationship, I need to be able to

be in a position where I can actually
ask questions, get information,

we can learn from each other.

Uh, because it's not always
a one way street, right?

It's very much a mutual relationship.

And so, if I'm in a pitch where I can't
get a word in because the person's like,

Oh, well, you know, let me finish my
next slide or whatever, then that's,

that's, that's a big red flag for me.

Vance: So Series B, you gotta
really know your numbers.

Uh, early stage, seed, even a
little bit of series A, one question

that you'll focus a lot of time
on is why are you doing this?

Like, what's your why?

Uh, and they really want to understand
the origin of the founder, the origin of

the idea, what you're passionate about.

Uh, because this is a journey
that you got to be really, really

resilient and you got to Uh, have a

Charles: really strong why.

And it's not just why,
but it's also why now.

Like, why are you
building Talk about that.

What do you mean by that?

Um, there's, I mean, there's so many
examples of businesses that were

started too late or started too early.

Uh, so it's not just why, in terms
of why are you doing it, but why

does this business make sense now?

Uh, and the In the context of
the macro, the market, uh, and

all that kind of good stuff.

What's a good

Vance: example of that?

Or they had a really good why now?

Charles: Um, you know, actually the, the,
the biggest one is Airbnb is, is one,

one example, which is literally people
wanted other opportunities to rent,

but they wanted a better price point.

And so, you know, there's a bunch of
examples where it literally matters more

about Uh, why does this make sense for
you to raise outside capital to actually

scale this company to solve this problem?

Uh, and so a great way now is you
can also show me a huge problem.

A huge problem that matter, that,
that affects a lot of people both

domestically or, or internationally.

That also is a, is a good
example for me to see.

Okay, yeah, that's definitely,
this needs to be solved now.

Yeah,

Chi-Hua: I've got a good one for you.

So, I think a great pitch has a very
unique insight associated with it.

Because if you put your You
put yourself in the seat of the

investor, the investor might be
hearing 20, 50, 100 pitches a week.

And that investor is just kind of churning
through it, flipping through decks, right?

But there's something that's going to stop
that person and it's going to make them

realize there's a unique insight here.

So in the WhyNow camp, remember
when I first met Daniel Ek, uh,

when he was running Spotify, a
couple hundred thousand subscribers.

The way he articulated
the WhyNow was so amazing.

He said, I'm sitting in Sweden.

I have plenty of money, and I want to
buy music, but I cannot buy the music

that I want because the, uh, iTunes
store was not available in Sweden.

And then I go on BitTorrent to steal
the music, and I get all these files

and they're all crap because the
music labels had started to pollute

BitTorrent with, with bad music, but
named it the name of the actual song.

So that's the Reason why now, right?

If it had been three years earlier,
BitTorrent would have been a

perfectly easy way to get music
in, uh, in, in, um, Scandinavia.

If it had been three years
later, the iTunes store would

have been available there.

And so he sat there, he was so
frustrated and he's like, I gotta

solve this problem right now because
I am willing to spend ten or twenty

dollars a month to pay for unlimited
music, but there's no way for me to get

Vance: it.

And, and here's where magic
moments happen when a big problem

meets a tectonic platform shift.

Right?

And so think like Lyft or Uber.

A big why now is GPS enabled
phones that everybody has.

Right?

That business literally could not
exist without that specific why now.

And so when there's tectonic platform
shifts that meet a big problem, then you

have something that can be really magic.

Yeah, I

Katrina: think we Do we want
to go to questions in the

Chi-Hua: room?

We do want to go to questions.

Ps Adam: So if you've got questions,
I'm going to roam around and ask.

I did want to ask a question though
about from the investor's point

of view, when you're looking at
a founder, what is the level of

expertise you expect a founder to have?

I mean, we've just been talking about
problems, their passion, their vision,

but I mean, they have to have expertise.

How do you measure that?

Chi-Hua: They should know.

Ps Adam: If you have questions,
just raise your hand.

I'll come to

Chi-Hua: you while they answer this.

In my opinion, they should know
more about this problem and how to

solve this problem than anyone else.

Right.

And they might not know
more about the problem.

There might not, there might be somebody
who is more academically inclined

that understands the problem better.

They might not, uh, be able to
solve it better than anyone else.

There might be a very technical
person who's able to solve

it better than anyone else.

It's the coupling, it's the integration
of those two, which is understanding

the problem and how to solve it.

In a unique way, better than anyone else.

Yeah.

If I'm

Charles: asking more detailed
questions and the founder is able to

answer it, then that's like, okay,
I, I, because I, I, my job is to

invest and then go invest in another
company and let them build and scale.

And so they don't have the expertise
to run the company by themselves.

That's not my job.

My job is not to run the company.

My job is to provide governance,
insight, capital, and then let

them, let them do their thing.

Ps Adam: I love that.

All right, we have found a question over

Vance: here.

Chi-Hua: Hi, my name is Jackie and my
question is when you can think about a

presentation or a pitch deck, what Was
in that deck that special deck that stood

out to you something special that we

Vance: can think about

Ps Adam: like a memorable
one that they've Seen okay.

What has been the most memorable
pitch deck that you thought

that got me that thing got me

Charles: Decks that actually
have very little words

Vance: So

Ps Adam: a lot of pictures.

So you're a picture person
Charles wants a picture book.

I love it

Vance: VCs are not that
smart, you know, so not that

Charles: smart we Things have to stick
quick And so if I have to read, you

know, two, three lines, I'm done.

I mean, I'm flipping to the next
thing because I'm looking at hundreds.

I need to get to the answer quickly.

Uh, and so if I see a lot of
words, it's a lot of white noise.

I can't, I can't assess that.

What that tells me is that that person
can't boil down with the problem, what

they're doing succinctly and punchy.

And that's going to be a problem when
they go sell to customers, when they

go try to hire their next key person.

And so for me, that's actually the
first test is, is your deck busy?

Is it, is it tight?

Is it clean?

Is there viewed a little?

Zero grammatical errors?

Like, like, that for me is a huge litmus
test in terms of who I'm actually going

to be meeting with or dealing with.

Chi-Hua: There's usually one thing that
you look at it and you're like, that's

not possible or that sounds like magic.

And that's what you really key in on.

Like, uh, this Korean financial
services company that we backed,

it's the Venmo of Korea, basically.

And what the founder explained is it takes
35 clicks and you have to enter your name

and password three times and you have to
answer the phone and pick up a call for

any transfer greater than 20 US dollars.

And we turned it into three clicks.

So at that moment, you're like,
wait, that sounds like magic.

That's not possible.

How do you do that?

And that's when you really lean in and you
realize, wow, this is going to completely

disrupt the way that all these people
used to do this money transfer thing.

And make it much simpler.

So you're looking for the magic moment.

It's like the first time you held
an iPhone and you like pinched

or like you swiped and it moved.

You're like, Whoa, this is
totally different from my Nokia.

Actually, y'all are too young.

You don't have Nokia.

They are too young.

I

Vance: play Snake.

Chi-Hua: I play Snake.

This is different from my Blackberry.

Yeah, yeah, yeah.

Vance's first iPhone
was like the iPhone 6.

Exactly.

For sure.

I have four kids.

She welcomed me.

That's right.

You got four kids.

Alright, we got another question.

Another question over

Vance: here, guys.

Chi-Hua: Hi, my name is Joshua.

Um, when, when it comes to leadership,
what are, in your opinion, one of the most

important leadership qualities to possess
that maybe you try to look for when a

founder is looking for an investment?

Vance: Oh, that's good.

What leadership

Chi-Hua: qualities are you looking for?

That's a really good one.

Humility.

Because as a founder, your job
is to fail over and over and

over again and learn from it.

And get up and be able to tell the
team around you, Hey, we failed,

but we're going to do this again.

And here's what we learned from it.

Here's how we're going
to proceed together.

If you're arrogant as a founder, like
in good times, like we went through, you

know, not too long ago, and everything's
going up in the right, Oh, it's fine.

Like as an arrogant founder,
people just throw money at you.

But in hard times, when you actually
have to go through it, being a

humble founder matters a lot.

Charles: Strong convictions, loosely held.

So sometimes I may have
insights that can help.

Uh, but sometimes I'm wrong and I
need a founder who is not like, Oh,

a yes man, a yes woman and say, Oh,
you know, because I'm a VC and I

say something that means it's right.

No, if I'm wrong, correct me and do
what you think is best at the same time.

If my answer or my insight
is more helpful than take it.

So coachable ability to, uh, to
say no, say no to me or correct me.

It's just the word.

Vance: Oh, that's so

Ps Adam: good.

All right.

I'm at the back here behind the hype team.

All right.

And we've got a question about AI.

Chi-Hua: Hi guys, I was just wondering,
um, great session by the way, I

was just wondering what role you
think AI is going to play in this,

um, relationship between VCs and
founders and also practical advice.

What kind of tools exist today that
could help people looking to make pitch

decks, uh, to present to you guys?

Vance: There you go.

Ps Adam: I don't know who that's for.

I feel like that's right
up Chiwa's alley, right

Vance: up Vance's alley.

Well, I mean, I, I would say
that AI, I believe is the

next tectonic platform shift.

So the last one, if it was mobile,
and smartphones being on everybody's

hand, I believe that AI is actually
going to be even more than that.

Think about this, right?

So there's a little bit of a
nervousness with people that it's

going to displace a bunch of jobs.

But maybe those are jobs we don't
wanna do anyways, . And so if it

displaces the jobs that we don't wanna
do anyways, that can be handled by ai.

It frees up people to be
able to solve problems.

And trust me, there's a lot
of problems to be solved.

That's what entrepreneurship is.

And so that problem that you wanted
to solve where you were like, man,

I wish I had an app for that, or I
wish I had a piece of software for

that, you're gonna be able to prompt
in two years chat GBT, and it's gonna

create that app for you in 30 minutes.

Right, and so you're going to see
this proliferation of entrepreneurship

because of AI, and I believe that's
one of the platform tectonic shifts.

I would say that, you know, in terms
of the deck, it needs to be cleaned,

it has to have not many grammatical
errors, it has to be excellent.

But ultimately, going back to what
we were saying earlier, um, for, for

investors like Charles specifically,
that warm intro goes a long way.

Right.

And so, uh, building your network,
uh, being able to have conversations

with other builders, with other
founders in their portfolio, um,

getting conviction from the community
and getting those intros will help

a ton in addition to a good deck.

Charles: Yeah.

I don't know who this is for, but, uh,
don't focus too much on building the

product or what you're doing that you're
not building relationships, uh, because

your product can only take you so far.

If you're actually looking to raise
capital, you need to have relationships.

Right?

A.

I.

is not going to remove relationships.

It's going to help
improve a lot of things.

I believe way back when the calculator
was launched, everyone was like, Oh, the

calculator is going to like make all of
us dumb and like inability to, to compute.

No, it actually made us
to be more effective.

And so I believe AI is actually going
to, going to disrupt every single sector.

I haven't heard a sector that won't be
disrupted indirectly or directly from AI.

Ps Adam: So what I'm hearing is
don't have chatGBT write your pitch.

Got you.

Okay.

We've got another question.

Vance: I'll

Chi-Hua: hold it.

Oh, okay.

Ps Adam: You come to me.

Okay, sorry

Chi-Hua: about that.

Um, thank you all so
much for all this wisdom.

Um, this question is actually for
the founders, uh, for the investors.

I want to know, what are some
major red flags that you run into

when people are pitching you?

And I'm not talking about character
flaws in the, um, the founders.

But what are some red flags in the ideas?

What are some things that make you think
like, I never want to invest in this.

This is a dumb idea.

Like I want

Charles: nothing to do with it.

Um, great question.

So going back to the six Ms, if I, if they
can't explain the market, the market's

tiny, then it's not worth my time.

If the management team doesn't have
expertise, then that's a red flag.

Literally just go down.

If, if, if what they're building.

The person next to them is building the
exact same thing that better, faster,

cheaper, that's the moat, uh, literally,
like, I just go through the six M's and if

they don't cross the checks, then I don't
get down to investing or spending more

Chi-Hua: time.

Yeah, if your solution is just a little
bit better than the other one, then

that's not going to get you very far.

And the way you know that's the case
is if you find yourself comparing

yourself to others in an incremental way.

So as you're preparing that pitch
deck, you think, well, this is like 5

percent better than this other thing.

That's not good enough.

It's gotta be 10 X better or it has to
be something completely transformational.

This

Ps Adam: is so stinking good by the way.

Chi-Hua: This is great stuff.

These are good questions.

That's why it's good.

Daniel.

Stand

Ps Adam: up.

If you got a question,

Vance: man, come on.

Sorry about that.

Chi-Hua: So my question
is, um, I'm North American.

Lots of people are North American
here with very good companies and that

have success in their own countries.

What is the key thing that you look at
those companies that want to be global

Vance: ones?

Chi-Hua: Chiwa.

You know, North America has an
unfair advantage in terms of

creating global competitors.

And I know you're from Brazil,
so I'll just draw the analogy.

Um, North American companies are
able to generate a level of unit

profitability, uh, because of the
wealth of North America, either

the companies or the consumers.

That's very, very hard
to replicate elsewhere.

So the reason, so we've got a
global portfolio, and we see

this pattern over and over again.

It's interesting.

Latin American companies,
Southeast Asian companies, African

companies, in general, struggle to
compete outside of their markets.

And one of the main reasons why is you
can't generate enough unit profitability

in your market to actually afford
the sales and marketing expense of

entering a much more expensive market.

So we have a company called Getir.

It's the biggest 10 minute
delivery company in the world

based in Istanbul, Turkey.

extremely profitable in Turkey,
46 percent gross margins, 22

percent contribution margins.

They go to the Europe, they go to Europe,
they're losing money hand over fist.

It's just like really, really
expensive to compete in Europe, right?

The European companies on the other
hand have very expensive infrastructure.

They, they weren't able to compete
for a variety of different reasons.

Uh, but a company like new bank.

which you would know well, they
have extraordinarily high unit

profitability, which has enabled
them to export that model elsewhere.

We'll see if they can
come to North America.

They're doing well in Mexico.

We'll see if they can
come into North America.

But I'd really focus on getting
that right before you try to go

global, because North American and
to a degree European companies have

an unfair advantage in that area.

Chinese companies are different.

They have an unfair advantage because
it's a closed market, it's big, it's 1.

2 billion people and the government
protects them from outside competition.

Competition internally is incredibly
treacherous, but they don't really

have to face outside competition.

Uh, it's two completely
different asset classes.

So private equity is the right investor
for you if you have a mature business.

likely generating cash
flow can service debt.

So you have to have a pretty substantial,
I think five to one EBITDA to debt ratio.

Uh, maybe, maybe three years ago people
were willing to go to seven, but not,

you know, not too much more than that.

Uh, venture capital.

The reason that we exist is because
companies lose a lot of money

before they become profitable.

If they didn't lose money,
they wouldn't need us.

Uh, so.

The approach you should think
about is, if I have a mature

business, it could be of any scale.

But if it's a mature business
with a mature economic model that

generates profits, private equity
could be a good partner for me.

Most likely in that transaction,
you will lose control.

So in private equity, they buy your
business, they might employ you

and you might have a piece of the
equity, but you are now an employee

in the case of venture capital.

We will never own a
majority of your company.

In fact, it's just, it's, it's almost,
it's not a, it's not a rule, but it's

almost a rule that you never want to
own a majority of a company founder.

Stays in control the moment at the
founders no longer successful as the

CEO you have a conversation around you
bring in a professional CEO But that's

what a venture firm would do I'd also say

Vance: to that your growth trajectory
really matters on how to contextualize

your company So as an operator as a
founder, right if you're gonna stay on

the VC track, you have to grow And so
what growth in B2B SaaS, for example,

they're looking for 3x, 3x, 2x, 2x,
2x, year over year growth on something

like ARR, annual recurring revenue.

able to do that, or if it completely
stalls from there, then you might

want to cut bait, get profitable.

It might end up being a PE outcome,
but it's better than nothing.

Right?

And so, you just got to be
smart about that, clever on

how your company's growing.

That's good.

That's good.

Ps Adam: Right up the back row.

Literally just sneaking
into the hype house.

Vance: We've got a question.

Hi,

Chi-Hua: uh, can you talk about a
company of yours that achieved escape

velocity in terms of the funding process

Vance: where they went from knocking
on every door and people said no, to

Chi-Hua: not having to knock on any doors
and funders were actually coming for them?

Yeah, so this, um, Korean payments
company actually is a really good example.

So when we funded it, it was
building the Venmo of Korea.

And, um, you know, I mentioned
the fact that you go from

35 clicks down to 3 clicks.

You can transfer money.

Incredibly fast growing business
in terms of the adoption rate.

We probably had 2 or 3 million
active users at the time.

Uh, unfortunately, the unit economics of,
uh, peer to peer transfer are really bad.

You basically have negative gross margins.

So we took it up and down Sand Hill Road.

To every, you know, I, I, by that
point, probably spent 15 years, you

know, doing venture capital investing.

To every venture capitalist we
knew, including our old firms,

nobody would even take a meeting.

And the reason is, they said, one,
Korea, there's only 60 million

people, it's a small market.

Two, peer to peer payments has never
made money inside of Paypal Venmo still

loses money to this day and three,
the company was started by a dentist.

I'm not joking.

The guy was a dentist before he
started this and he had this insight.

He's like, I want to start this company.

And so we actually had to bridge
fund the company ourselves

because nobody would fund it.

We wrote a, I think it was a 12
million check to keep it alive.

Fast forward.

24 months, Sequoia, Kleiner
Perkins, Dragoneer, Temasek, GIC,

they all invested in the company.

It's doing 1.

6 billion in revenue, it's growing 60
percent year on year, it's probably

a 10 billion dollar EV company now.

But it had to go through that
really, really difficult time of

nobody would even take a meeting.

Much less turning it down.

Because it didn't look quite
right at that point in time.

But the founder, SG, he
had this unique insight.

He realized, the thing people do the most
in financial services is pay each other.

And so if you have that engagement,
you can attach a whole bunch of other

services to that over time and that.

Is that still just in Korea?

Right, uh, Korea and Vietnam.

Ps Adam: Sounds like an open market to me.

Alright, next question.

Chi-Hua: Is there a magic number
to the number of founders and

the dynamic they take on as the

Charles: company grows?

You mean, uh, how many people are
starting the company together?

Um, I would say co founder relationships.

Yeah, I would say it's more
focused on what are their roles

and what is their day to day.

So do you have a technical
founder as a CTO?

Do you have a person
running the company CEO?

Do you have a person running the kind
of the operations of the company CEO?

So it's more about.

Are there defined roles in that what
people are doing less so about the

number of people who are founders?

Vance: I would say there's a
disproportionate bias towards

somebody that has a co founder
though With certain firms not all

firms, but many firms bias towards,
you know, two or three co founders

Charles: Do you

Katrina: when you go into the
relationship with the founder?

Do you have to like all the founders?

Like, like them

Ps Adam: personally?

Vance: Just, like, That's
a bigger relationship than

the VC founder relationship.

Yeah.

Chi-Hua: Yeah.

I just can't.

Do the co founders have
to like each other?

No.

That's generally good.

From the investor's side.

From the investor's side.

Katrina: Because you just mentioned how
you've got this long term relationship.

Like, do you have to believe in
every single one of those founders?

Chi-Hua: Not as much.

The VC CEO relationship tends to be
the one that is the most intense.

There might be other co
founders on the table.

It'd be nice if the co founders
all liked each other though.

Yes.

That'd be a good thing.

Not always the case.

Not

Ps Adam: always the case, got it.

Yeah, how often are you barbecuing
with your, uh, your founders, you

know, your portfolio companies?

Vance: Not enough, not enough.

Right.

Okay, we've got a

Ps Adam: question over here.

Vance: Hi there, guys.

Chi-Hua: My name's Claire.

Thanks so much for being here.

Um, it actually was already
asked, but I wanted to reiterate

it because I was very curious.

So given SVB collapse, everything that
we're going through right now, can you

just speak to the venture capitalist
mindset market perspective right now and

Vance: how you guys are
thinking about that?

Great question.

Charles: Um, so I'll start
for at least at our firm.

We raised our fund, um, right kind
of before the whole craziness.

And so at least from
our perspective, Okay.

Uh, there's still a great
opportunity to invest.

So, uh, we have a lot
of money to put to work.

And so we're excited and
we're, we're showing up.

What's happening right now is that
there's still a disconnect, a bid ask

between where founders think the company
should be valued versus what the actual

valuation should be for a company.

Specifically from where I sit as a growth
stage investor, meaning I'm focusing

on the public markets when I underwrite
companies and, and describe evaluation.

And so, when I'm looking at
companies, uh, that, that makes

that, that gap even greater.

But, what I can say is, I'm taking
just as many meetings as I'm taking

before, uh, they're just ending a
lot sooner due to valuation issues.

Chi-Hua: It must be sunnier
where Charles lives.

Cause right now, I would say
it's the worst time in the last

20 years in the venture market.

Uh, companies, and I, I don't, I don't
mean that what you're saying is not

true, but the, the issue that I think
generally the entire ecosystem is going

through is like really bad indigestion.

It's like you eat a huge meal that
included a lot of stuff that you

shouldn't have eaten and you drank a
lot and then you wake up the next day.

You're like, I'm not gonna feel
right for a little while here, and

I think that's what's really going
on in the startup ecosystem because

companies got so used to two twin
tail winds that really helped them.

The first.

Was zero interest rates.

Zero interest rates makes
everything look more valuable

because your discount rate is zero.

And then the second was COVID.

COVID generally was a tailwind
for all digital businesses.

When you simultaneously take those two
away, there's just a readjustment period.

I think we're probably
We're six quarters into it.

We're probably two to four quarters away
from being through it, but this feels

a lot like kind of 2001 through 2005
type vibes in terms of the readjustment.

Vance: Very

Ps Adam: cool.

Matt Potter, folks, CEO of pray.com.

Got a question,

Chi-Hua: founder of pray.com,
not CEO, but thank you very much.

Yep.

Arun: You just got promoted.

I just got promoted.

Chi-Hua: Live . You're welcome.

Arun: Um,

Chi-Hua: we never, always get it right.

So what are some of the companies
that you passed on that were

Arun: super successful

Chi-Hua: and then how did you

Arun: tune

Chi-Hua: your systems for those companies

Arun: that you

Charles: missed?

For us we passed on Stripe at a billion
and then two billion and then four billion

and then ten billion because the margin
profile was so small And us as a firm we

hadn't built a framework for understanding
fintech companies, which typically have

very different margin profiles And so I
put my hand up a few years ago to say,

Hey, we, we, we keep getting this wrong.

What's going on?

Let's, let's change this.

And so that allowed us to
underwrite differently and

better for specific markets.

And so I think that's, that's key
is when you're spending time in a

market, you understand the dynamics
of that market, uh, not only in terms

of the company, but also the broader

Chi-Hua: macro environment.

How much time do you have, Matt?

I've got a long list.

Give us one.

All right.

One story.

Oh man, it's so painful.

Too many stories.

Uh, I had Travis Kalanick in my
office, um, and I was stupidly

trying to recruit him to join Kleiner
Perkins as an investing partner.

It was really clear Travis had no interest
in being a venture capitalist, but he was

just, he's a, he's a very interested guy.

He likes to learn.

So he's peppering me with questions,
and I was like trying to convince

him, you should come be a VC.

And at the end of the meeting, we
walk out, and I said, okay, clearly,

you're just not interested in this.

What are you excited about these days?

And he pulls out his phone and he
says, Oh, you know, Garrett and I

are working on this cool little app.

You push this button and a black
car will come and show up and,

you know, come pick you up.

I was like, oh, that's like really cool.

Like, there's seven people
who might use that thing.

You know, and, and he said, hey,
you can invest a quarter million

dollars at a six million post.

And I recently saw a blog post
on Twitter that said the people

who invested a quarter million
at a six billion post made 1.

2 billion dollars at the IPO.

So that's my, that's my, uh, my
one of several that got away,

but that one really hurts.

On

Ps Adam: that note,

Chi-Hua: ending on a high note, Adam,

Ps Adam: real high note, uh,
that actually makes us all feel

better actually, you know, to be,
doesn't that make us feel better?

Even they get, come on, can
we give it up for this panel?

My goodness.

So special.

Thank you guys.

Uh, for, uh, sharing that wisdom.