The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

Howard Marks is co-chairman and co-founder of Oaktree Capital Management, a leading investment firm with more than $120 billion in assets. Prior to founding Oaktree, Howard spent 10 years at The TCW Group, where he was responsible for investments in distressed debt, high yield bonds, and convertible securities. Howard has also written two books, most recently Mastering the Market Cycle: Getting the Odds on Your Side, and it was Warren Buffet who said, “When I see memos from Howard Marks in my mail, they’re the first thing I open and read. I always learn something.”

Bill Gurley is a General Partner @ Benchmark Capital, one of the most successful funds of the last decade with a portfolio including the likes of Uber, Twitter, Dropbox, WeWork, Snapchat, StitchFix, eBay and many many more. As for Bill, widely recognised as one of the greats of our time having worked with the likes of GrubHub, NextDoor, Uber, OpenTable, Stitch Fix and Zillow. Prior to Benchmark, Bill was a partner with Hummer Winblad Venture Partners. Before entering venture, Bill spent four years on Wall Street as a top-ranked research analyst, including three years at CS First Boston.

In Today’s Episode You Will Learn:

1.) In March Ray Dalio stated we would be entering a "global recession", how do Howard and Bill feel about this statement? How does today's environment remind Howard and Bill of 2010/11? What is similar? What is different? How does Bill think about investing through cycles?

2.) How does Bill think about investing through cycles? What have Bill's lessons been from seeing many venture vintages on LP performance across cycles? How does Howard think about investing through cycles from a distressed debt perspective? What have his lessons been from Oaktree's performance over the years?

3.) Do Howard and Bill agree we will not see interest rates go anywhere for the next 3-5 years? What is the impact of this sustained low-interest rate environment? What could be done that would see interest rates increase in the future? How does Bill believe this will impact the supply of LP dollars in venture?

4.) How do Bill and Howard evaluate the state of the public markets today? Why does Howard believe that FOMO has really taken effect? How does Bill think about network effects and the laws of compounding with regards to public companies?

5.) Do Howard and Bill agree we are seeing a retreat from globalisation? What are the core impacts of this retreat? Why is Bill so concerned about "regulatory capture"? Why does Bill fear that today, "Washington is for sale"? What would he like to see change?

Item’s Mentioned In Today’s Episode

Howard’s Favourite Book: Across That Bridge: A Vision for Change and the Future of America

Bill’s Favourite Book: How Innovation Works

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Sahil Bloom is the Founding Partner @ SRB Ventures, a $10M fund that leverages the 500K followers Sahil has amassed to invest at the intersection of venture and media. Previously, Sahil spent 7 years at a large investment fund managing >$3.5 billion in capital and serves on the board of 4 companies. He has also been an active angel investor in over 30 companies.

1.) How Sahil made his way from a career in traditional finance to building a media company and leveraging that to raise the latest SRB fund? How does Sahil advise others is the best way to "find their zone of genius"?

2.) How To Build a Media Engine:

• What have been some of Sahil's biggest lessons on what works on Twiter and what does not work?
• What is the golden rule for Twitter?
• How does Sahil plan and come up with ideas for his Twitter threads? What tools and software does he use? How long does each thread take?

3.) The End of the Road for Traditional Venture:

• Why does Sahil think traditional venture is dying?
• What newcomers will take the place of the existing incumbents?
• Why does he think they are weak? What do new players provide that they do not?
• Which existing players will remain and be strong? Which will fade out?
• Does Sahil believe that VCs really provide any value?

4.) SRB Ventures:

• Why did Sahil decide to raise the new fund?
• How did he decide on size of the fund? What is the strategy? What is the portfolio construction?
• How does SRB provide media services others do not?
• How did Sahil meet Tim Cook and get him to invest in the fund?
• What is the biggest thing Sahil believes most people misunderstand about luck?

Sahil’s Favourite Book: When Breath Becomes Air: Kalanithi Paul

Sahil’s Most Recent Investment: Wander

David Friedberg is Founder and CEO of The Production Board (TPB), a holding company established to solve the most fundamental problems that affect our planet, by reimagining global systems of production. Prior to founding The Production Board, David founded The Climate Corporation, a 10-year journey that culminated in their $930M acquisition by Monsanto. If that was not enough, David is the Founder and Chairman at Metromile and also sits on the board of Soylent, Clara Foods, Tillable, Cana Technologies and more.

1.) Origins:

• How David made his way into the world of startups and technology from academia and physics?
• What were David's biggest takeaways from scaling The Climate Corp to $930M exit to Monsanto?
• How did the exit put pressure on David for all future companies he builds? How does he manage that?

2.) The Macro: Venture + The Economy

• How does David foresee the impending rate hikes? What impact will this have on venture and the economy?
• What segment of the market will be first to be hit? Why is growth investing last to be hit? How does early stage play out in this very new environment?
• How will we see the velocity of capital deployment change in this new period? What does David believe are some of the crucial flaws of the venture model?
• How does David reflect on his own price sensitivity? What lessons has he learned from deals he has done or missed that have changed his perspective?

3.) David Frankel: The Business Builder

• What is David's rubrik for business value creation? How has this changed with time?
• How mentally plastic does one have to be around the time it takes to see margins, unit economics etc change from negative to positive?
• How does David and the team approach building new companies at TPB? Where do they find the founding teams? How do they incentivise them?
• How does TPB approach continuous funding for the companies they create? What milestones need to be hit? How do they assess them?
• How does David approach liquidity with regards to exits for the companies they create? Why does their holding company structure mean they have different incentives to VCs?

4.) David Friedberg: Father and Husband

• How does David reflect on his own relationship to money today? How has it changed over time?
• What have been David's biggest realisations on what provides him true happiness?
• How did having children change his operating mentality? What does being a great father mean to David?

David’s Favourite Book: Zen Mind, Beginner's Mind

Scott Belsky is an entrepreneur, author, investor, and currently serves as Adobe’s Chief Product Officer and Executive Vice President, Creative Cloud. Scott oversees all of product and engineering for Creative Cloud, as well as design for Adobe. In 2006, Scott founded Behance, the leading online platform for the creative industry, and served as CEO until Adobe acquired Behance in 2012. Behance now has over 25M members. Scott is also an early advisor and investor in Pinterest, Uber, Sweetgreen, Carta, Flexport, Airtable, and several others. Finally, if that was not enough, Scott is the author of two national bestselling books - Making Ideas Happen and The Messy Middle.

1.) Narrow the Focus, Increase the Quality:

• What does Scott believe is the core challenge in product?
• What was the single biggest product challenge Scott faced at Behance? How did they overcome it?
• When should product teams listen to customer feedback vs ignore it?
• What are the core questions product teams should ask user groups to extract the most feedback and value?

2.) The Importance of the First Mile:

• What does Scott believe makes a great first mile when it comes to the product experience?
• Where do so many companies go wrong in creating the first mile user experience?
• Which company at scale has retained this simplicity of the first mile? How did they do it?
• What does Scott mean when he says, "the devil is in the defaults"? What can product teams learn from this?

3.) The Makings of a Great Product Leader:

• What are the 3 core questions every great product leader should ask on every screen?
• How do the best product leaders structure product reviews?
• Who is invited to product reviews? How often are they? Who sets the agenda? When is it sent?
• What do the best product leaders do to retain direction and productivity in reviews when there are many people and many ideas? How do they stay on track?

4.) The Hirings of a Great Product Team:

• How can founders know whether to hire the product leader or retain the role? When is the right time?
• What are the single biggest mistakes founders make when hiring their first product hires?
• How should founders structure the hiring process for product hires? What should they look to gain from each interview?
• What are the must ask questions in those interviews? How do the best respond?
• What case studies or physical tests can be done to determine the quality of a candidate?

Ralf Wenzel is the Founder & CEO @ JOKR, a global platform for instant retail delivery at a hyper-local scale serving both the US and LATAM. Ralf has raised over $260M for the company, most recently valuing it at $1.2BN. Prior to JOKR, Ralf spent 7 years as the Founder & CEO @ foodpanda, as well as, enjoying roles as Chief Strategy Officer @ Delivery Hero, Interim Chief Product and Experience Officer @ WeWork and even moving to the other side of the table as a Managing Partner with Softbank.

1.) What is the unit economic breakdown for quick commerce business models? What levers can be used to improve it over time?

2.) Comparing the US to LATAM:

• What is the AOV (average order value) in the US vs LATAM?
• What is the order frequency in the US vs LATAM?
• How does labour cost vary when comparing LATAM to the US?
• How does real estate cost for fulfilment centres differ when comparing LATAM to the US?
• How do product margins on a per product basis differ when comparing US to LATAM?

3.) New Market Growth and Maturation:

• What is the payback period for new markets? How has this changed over time?
• How does the payback period reduce with every new market being opened?
• What % of AOV is spent on marketing when a new market is opened? How does this marketing spend change over time?
• In mature markets, how much new customer acquisition is organic vs paid?
• What is the average weekly growth rate in new vs mature markets?

4.) Business Model Expansions:

• How does Ralf and JOKR approach the potential for private label goods?
• How does private label change the margin structure of the goods?
• What have been their lessons from starting their first private label goods?
• How does Ralf approach the ability to integrate advertising and paid search?
• What is needed for paid search and advertising to be a meaningful part of the business?