SPEAKER_01: if you look at the longevity of reddit what are the takeaways for you as the co-founder

SPEAKER_00: the power of community was able to sustain reddit after the sale to common ass in those four or five years when it was just a part of conday yeah they didn't know what to do with it it kind of just languished but the community kept it alive the community kept growing and engaging and there aren't many products that should get away with basically doing nothing for five years and still succeed year after year after year and reddit managed to and i think it's a testament to the

SPEAKER_08: community of those users and we got just enough things right early that it endured yeah it's like

SPEAKER_10: you set this foundation somehow that was so stable that even a giant media corporation couldn't knock

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SPEAKER_15: month all right everybody i'm back i'm back i had an amazing time last week i went to this conference

SPEAKER_16: you may never heard of it because it's for vcs and the people who invest in vc funds limited partners vcs it's called the eye connections global alts 2024 conference it took place in miami which is delightful i was lucky enough to have a podcast studio there and i was able to interview two folks one my old friend alexis ohanian the co-founder of reddit and we talked a lot about the reddit ipo we talked about what he's doing as a vc we talked about anonymity and pseudonyms a popular topic going around now because twitter now has gone full hey you can have pseudonyms and you can't be doxxed or people can't reveal who you are sort of really interesting discussion and then i got to have the eye connection ceo ron biscardi somebody i became friends with over the last couple years a really thoughtful guy and we talked about the state of the market how lps and gps general partners of venture firms like myself who invest in startups how that's all going on listen it's a recorded outdoors so you might hear a little wind uh or some sirens in the background but it gives it a little more charm enjoy and thanks again to the eye connections team for hosting us all right everybody welcome to

SPEAKER_18: this weekend startups frequent uh guest and friend of the pod alexis ohanian is here founder of reddit

SPEAKER_20: legend friend and just smaller on smart guy i want to talk to you about two things obviously i want to

SPEAKER_22: talk about reddit going public that's mind-blowing yeah that's mind-blowing for all of us crazy 2005

SPEAKER_01: we started that thing it's nuts it's the last 20 years what's the lesson of reddit if you look at the longevity of reddit what are the takeaways for you as the co-founder you know uh

SPEAKER_00: the power of community was able to sustain reddit after the sale to common ass in 2006 yep steve and i left around 2009 2010 respectively and then i came back in 14 as chairman in those four or five years when it was just a part of conday yeah they didn't know what to do with it it kind of just languished but the community kept it alive the community kept growing and engaging and there aren't many products that should get away with basically doing nothing for five years and still succeed year after year after year and reddit managed to and i think it's a

SPEAKER_08: testament to the community of those users and we got just enough things right early that it endured

SPEAKER_10: yeah it's like you set this foundation somehow that was so stable that even a giant media corporation

SPEAKER_13: couldn't knock it over destroy it they couldn't destroy it and then you were able to somehow wrestle

SPEAKER_22: it out i think thanks to sam allman yeah that's a funny story go ahead not for me to tell not for

SPEAKER_29: you to tell i mean i mean i know the periphery of the story but give us drugs uh to the extent you can

SPEAKER_32: he was pretty instrumental sam sam and i were in the same batch in y comedy that first batch yc

SPEAKER_33: we've known each other for looped and he was pretty instrumental in bringing a lot of folks around the table from a number of different venture firms to do the first investment that really brought in outside capital to dilute kind of asked and let reddit be an independent company again yes that

SPEAKER_00: was around 14 maybe and uh and joined the board and uh yeah it's been i mean it's wild like the the certainly the education that i got between 2014 coming back and then 2018 when i went back to doing venture full-time showed me so much about how to actually grow a business how to actually as a first-time ceo first time out of college starting this thing i got so many damn things wrong that second time around was in education caitlin who was our head of people now started seven seven six with me we worked together a decade i've learned so much from her and it's funny i don't know there were so many of us who were kids if you think about from that era building these social media platforms and i have to give him his flowers zuck really was in a league of his own yes understanding just this level

SPEAKER_36: of gamesmanship and how to build and execute a company in a way that the rest of us i'll just

SPEAKER_38: speak for myself just didn't have yeah another level it was like there were people doing it in a

SPEAKER_10: bespoke way and then he came in and did it in a methodical thoughtful like just yeah perfect way um

SPEAKER_40: but hey we're going public allegedly allegedly going public yeah no comment on that but they

SPEAKER_18: gotta be great for reddit to go public uh whatever the valuation winds up being it doesn't matter it's

SPEAKER_20: what matters is it'll be recognized for the juggernaut of a business it is it actually makes tons of money in terms of revenue and where is it in terms of traffic in the united states and traffic in the world it's i know it's a top top top top site it's tricky it's like people will

SPEAKER_45: cherry pick that like based on alexa data versus mobile data got it but let's say top 20 50 yeah i

Chamath Palihapitiya: mean you could take out the chinese sites right if you just were doing the western world english

SPEAKER_33: speaking world like it's kind of a big deal but what's surreal to me is i don't know we're entering this new era now where i think finally community is getting its flowers that was the thing pseudonymity

SPEAKER_00: and community were the two things that i begged people to believe in in 2005 and there were a handful

SPEAKER_33: of people who did most people were like that's nuts today i think the durable businesses i know you've talked a lot about mr beast on the all-in pod yeah the all-in pod is an example of this yeah people who are able to build near fanatical community yes are able to endure in a world where there's going to be a million distractions and a million different ways to steal your attention and i think we're going to see the durability of real brands versus fake brands that people like maybe would have been happy to have a subscription to in the past but didn't truly love right and you you know today someone can build it directly and and i think reddit the one thing we did get right was not making about us per se we built it for communities you know even the follow model we probably missed out on building twitter before twitter we did launch a few years before they very very very wisely made a follower model around individuals so you can say hey i'm jason follow me if you want more of my stuff right we didn't have a follow button and we actually used to have product discussions about this internally because reddit was about follow the community if you love cute animals follow that community and so mods had a very different role there but individuals didn't really have a place to put their content because they couldn't tell people you know even if you were a web comic artist like xkcd which was like right down the fairway of beloved early reddit content creator it was weird to post your own content on the xkcd subreddit because it felt too

SPEAKER_55: self-promotional yes and so that i stay out of the all-in thing because it's like that's not my place right that's your place but that's the fans place and it's it's magical for that right then it also

SPEAKER_33: makes my job really hard for a decade and a half to try to convince the creators to spend time there right because there's no obvious way for them to do it and where twitter got it so right was they could just say like yeah if you got cool content posted here stream of consciousness and if you

SPEAKER_10: dovetail pseudonymity and the ability to be anonymous but thoughtful or anonymous but clever that's kind of how it washed out over there it wasn't vicious but it was candid and yeah there

SPEAKER_61: even yourself you know like they'll come after you though i mean if you go into your own subreddit that is like prepare yourself bring armor it could be full contact it is uh in the best case scenario

SPEAKER_33: you still have identity like people what it's not pure anonymity pure anonymity has no um consequences right if you're fluffy bunny 12 it may be a made-up name but you still have identity or if you're

SPEAKER_00: consistently an asshole people know they see that reputation reflected in you right there's a cost to being a consistent asshole and so pseudonymity yeah and that was not any kind of brilliant thinking that was just grew up playing video games you always use a pseudonym when you're playing quake 2 you have a handle exactly that's it and and what i love though was you would see what people really felt

SPEAKER_33: and probably the best lesson i got was two three months into starting red we're talking 2005.

SPEAKER_00: the site would go down and the number one one number one post would be hey nothing which is my username okay you're an affing idiot why is the site down and you're like fair and and but it was i should

SPEAKER_33: have put more memory in the servers you i didn't load balance it exactly you had to take responsibility for it and so it's like show up in the comments explain what's up and i think that endeared in the early community to what we're doing and how we're doing and it gave me the best education for how to handle those types of situations and it's not to say i've been perfect but generally speaking being the the front like the face of a community-driven platform and elon is experiencing

SPEAKER_36: this yeah is a very very different dynamic than building a business as a ceo in a physics-based

SPEAKER_33: company yes and and it's almost it's part political as much as it is uh just business right and and so the the greatest education that i could have gotten was being a ceo in the internet age was having my

SPEAKER_53: own users shit on me two months into creating this thing yeah and knowing that that was just the norm we'd have to hold ourselves to that standard and well but you know what i see in that now what i've

SPEAKER_10: learned over time is if they didn't care they wouldn't have made a comment very true so here they care enough to roast you yeah and then you like take the roasting and then there's like oh and here are two really good points yes and then here's a lot more roasting and so what you have to

SPEAKER_71: do is just be like okay yeah okay you're fat you're ugly this is a great podcast you disappointed me

SPEAKER_74: i'm publishing this week i'm talking about me podcast i'm talking about me but like literally this is

SPEAKER_75: before i lost the weight they're like you fat greek wow why didn't you publish this week that was on reddit so whatever it is and then then they're like because i really love the pot and i'm like thank

SPEAKER_16: you mom i always come back with some joke like that all right listen selling software is hard enough

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SPEAKER_69: but what i want to talk to you about is venture capital investing in companies because you and i have

SPEAKER_10: had like a a little dovetail like a career experience we both created properties on the internet that were loved whatever and then we started investing in companies and we had great success there and innovating in what we do we both started our own firms and we're both trying to innovate a bit and then i watch what you do and you created cerebro and i'm a huge x-men fan and i'm like oh why didn't i think of that i thought of a lot of things i have a lot of little secret things i do as an investor but i never thought to create cerebro where you track the mutants like professor x and then you track how you're helping them at professors school for gifted mutants that's good that's canon yeah that's

SPEAKER_55: right and so tell everybody about what cerebro is to the extent you're willing to talk about it i

SPEAKER_53: should i really should do a better job of talking to us more it's not like it's secret it's just lack

David Friedberg: of whatever interest or i think you're focused on actually just trying to be professor x not promoting

SPEAKER_33: the x-men yeah it's reasonable there you go focus focus on that core work but to your point i think there is a there has always been and there certainly in this new era of venture will be a type of investor that is truly differentiated through the just the they do and by consistence is what i tell younger folks at the firm it's like the best way to build a reputation is do dope consistently like do the things you say you're going to do consistently for founders and that builds your reputation slowly at first and then gradually it increases and as a product designer i think i've wanted a version of this for my entire career not just as an investor but also as a founder because so much of work gets lost like there's even rebuilding the reddit revenue business in 2014 i think it was an 8 million revenue business when i came back did 8 million revenue that year turning that into 150 a few years later was actionable because we could hire a sales team that would use salesforce and we could see very clearly okay here's the effort here are the dollars how are we doing who needs to improve who's doing well what do we learn there's there's a feedback loop you measured it it was obvious and easy to measure right that's probably the easiest part of any business to measure but you can still unlock so many things by learning more but adventure most folks have no idea and you don't even know if you did well as an investor until five seven ten years later yeah so how do you create the feedback loop with your team with your founders and so i wanted this notion of receipts for myself as well as for the team and for the founders you could hold your team accountable exactly and they can hold themselves accountable and and creating that culture of accountability that like you need in a business but frankly i think a lot of traditional venture firms were not built by operators in a business-like way right they're lean back financiers who wire some money wearing their what's the what are the the sweaters what are the sweaters that chamoff likes oh laura piana laura piana sweaters leaning back type of stuff yeah it's a different energy and i do think this new era is going to be won by builders and and folks who are hungry for that kind of accountability to founders to themselves to their team right so what do you track what do you track i know we'll do even if i so founders can actually use cerebro to draft tweet storms as an example uh almost like a hoot suite or a tweet deck yeah for me to then edit and approve sweet then we track the impressions the click-through rates the the the i can say unequivocally like the tens of millions of impressions we've generated the idea that we can do distribution and then have accountability back to the founders to say here's what it is and then gamify it yes so the top five companies shout out intro which is one of the best at doing this now set a standard and we have a leaderboard because i fucking love a leaderboard of course so that other founders can see like oh wow like here's an amazing tool here's a resource now that competitive fire that's in most of our founders makes them say okay why aren't we getting more out of this let me talk to my social team and try to do things that frankly i don't know if other uh institutional venture folks have done and and i also want to scale my time right i want the time spent not to be thinking hey who do i know at company x to make the intro i want a founder to run a search through my rolodex find the person they're looking for click a button

SPEAKER_00: draft the email so then all i'm doing is at two in the morning looking at a push notice yeah clicking put the kids to bed and zip zip zip like that's a way better use of time of course than a 20-minute

SPEAKER_103: phone call to like pick my brain about who i know at disney but i think what we learned as

SPEAKER_10: entrepreneurs was there are these as rule of a column of sequoia crucible moments there are just little pivot points sliding door moments butterfly effect moments where you know you tweet something the right person sees it they lead the next round change everything the right person the right celebrity sees it boom they use the product and they organically tweet about it or share it on instagram

SPEAKER_20: and those sales go 10x and it really is that blocking and tackling what have you learned through this latest boom bus cycle we both lived through dot-com era we both lived uh and experienced up close and personal great financial recession now we're here third time we've been through this yeah it's like that uh scene where they're both in the nooses and the guy looks over the other guys like first time first time first time yeah what did you learn this time around and we sort of collapsing and arguably now 2024 we're starting to come back it feels like um how did you handle it this time

SPEAKER_115: what did you learn i i barely admittedly i was in high school during the dot-com one but the

SPEAKER_33: uh hitting the recession when i did i was very lucky because i was an executive at common asked we certainly felt the revenue drop but i didn't feel the existential dread because you know we had exited

SPEAKER_00: i had a salary i wasn't worried about you know losing my job and we were a team of four so it wasn't like we were a big burden on their balance sheet so this time around it has been i think i keep thinking

SPEAKER_33: about that meme about hard times create great men or in this case hard times create great companies the sobering up and i will say this y'all's i it's funny i have such a i have such a tormented

SPEAKER_00: relationship with the all in podcast oh you do because i love listening to it okay i i know your

SPEAKER_119: favorite bestie so that's good there are times there are times i wish i could teleport into the

SPEAKER_33: conversation you can i'll give you a link no i but like there's and that's why i'm tormented by it because i'm like oh but and and but that's i think part of the magic of it i will say too it gives me it gives me a view into the brains of people like david that i normally wouldn't want to spend a lot of time in sex sex yeah yeah that uh yeah not freeberg freeberg's brain is it's a beautiful mind but it's a helpful it is such a it's such a very helpful extra perspective to get that while i'm sitting you know on a commute in south florida i can like get into my brain yeah but the sobering reality of how drunk everyone got and how i mean you all have been one of the few voices actually talking about like hey everyone's gonna have to come to jesus pump the brakes like it's been it has been take action so helpful in even thinking about the kind of counsel that i'm giving the founders and look sometimes it's validating because sometimes i'm like yes like we were telling our founders this two weeks ago

SPEAKER_53: and now they're talking about it on all in or other times it's like damn all in's got a point here i

SPEAKER_127: really should take this more seriously well great conversations amongst people who are in the field

SPEAKER_129: doing the work yes are invaluable and you think about how we grew up and it really dovetails with what you created and steve as well with with reddit you know you give a voice to counterbalance other voices where the other voices we have mainstream media that we grew up with maybe we have government

SPEAKER_28: and then academia then oh this is community and they have a say too yeah and then people type in the name of the movie review reddit oh yeah right throw red on every google search please you know what there's experts in the field i could read this tech publication or i can listen to these guys gals people this podcast that podcast or their social media or their sub stack or their email newsletter

SPEAKER_20: and get another perspective from experts and i think adding the community bottom up and then adding experts to your media mix will get you to truth quickly absolutely traditional media plenty to dig them

SPEAKER_28: about but there's something about the age of expertise and you know you should be doing more

SPEAKER_57: i i need to consult with you on the uh pod strategy it's i have wondered though it's funny you i'm sure you all

SPEAKER_00: have noticed there's been a handful of other folks in and around tech that have tried to do what i feel

SPEAKER_57: like is their version of all in oh my god there's like five of them six of them and they're all and it's i don't know what it reminds me of it feels like i i think it's so cliche but like they're not

SPEAKER_00: attacking it from like first principles thinking they're just saying like okay we're gonna exactly

SPEAKER_154: it's like a it's a it's a duplicate with different people that's the formula yes but it's they're not

SPEAKER_57: open laugh right and then edit it and it's just like it's not quite there and it's so funny to me

SPEAKER_33: because i would have expected at least one or two others that would be inspired by y'all that would have started to get some traction because i want that right i why not i want more operators maybe okay we've got a great uh round table of investors slash company builders but like where's the version of that around developers i don't brands or developers or marketing or community yeah there's and so i i'm excited to see that i don't think it's starting like i there are people are you just

SPEAKER_127: going to do it as part of the all-in empire uh you know here's the thing about empires like be careful because when you try to build an empire that's maybe when it falls indeed you know and i'm a big

SPEAKER_129: fan of like if you have something that's working here's an idea make it 10 better every time you do it five percent better compounding every 7.2 weeks or every 15 weeks it doubles in value which is the lesson of running like you guys made very small changes you kept growing it you didn't f it up and i'm a big fan of not things up yeah so i told the guys like we did a podcast we did an event like okay and that's in three years so that means every 18 months on average we drop something let's stick with that and let's just make every week fantastic and you know maybe we'll get there um seven seven six is the fund yes sir uh you're on your second or third fund now and where are you

SPEAKER_127: third third fund and uh you invest in seed series a yeah we do a little incubation too now so

SPEAKER_00: incubation precede seeds your seed's still the sweet spot but uh been messing around a little

SPEAKER_166: bit on the incubation front it's fun i think it's a great thing for you to do we're doing about 100

SPEAKER_55: investments a year for more programs let's go well you know i think watch out yc well here's gauntlet

SPEAKER_28: throne 99 of people don't get into yc so you have to ask yourself if we do 100 more that's like one point two five percent of this of the population getting into a program yeah and so you know if you had your program and another point two five or point five percent of the applications to a yc and textars get accepted it's not really competition that's fair you know it's it's fair it's like it would be like if harvard is so good why aren't they accepting 20 more students every year hmm right accept some more students and make it more available if it's that good and that's why i think you should just do your own and don't worry about it like all right barry tan will be

SPEAKER_20: called gauntlet throne why just do once a year and do it if you enjoy five companies that you enjoy and that you want to spend time with you you have to optimize for what you enjoy we'll see so i'm i am

SPEAKER_00: so sadistic or no masochistic i want to incubate like i'm incubating some idea that i have getting the like v1 built yeah a little bit more studio but not like not full-on studio but like we'll probably do one or two incubations that way this year because i'm a masochist who loves that and it's getting dude the rate at which you can get something to market now that's crazy i mean it's

SPEAKER_183: it is not pilots or whatever i mean it's like you could have the idea and six weeks later you're in market actually testing it you've got i mean everything from copy i mean so much of this stuff

SPEAKER_127: is now getting accelerated to stand up content uh customer support payments ai whatever it's all

SPEAKER_186: button it's like everything's abstracted and so what's left community brand you know and solving

SPEAKER_129: problems for people all right listen you got to go you got more meetings to do alexis i'm out of meetings thank you jay seven seven six if you want to uh have one of the greatest investors of this generation i think what you're going to do if you keep at it for the next 20 years you'll quit

SPEAKER_10: brother no i mean honestly you are just getting started and i think what you're doing with cerebro is really when a founder is making a decision about who to pick i think the best way to do it is to just talk to existing portfolio companies ones that failed especially ones that succeeded ones that were in the between and then you know everything you need to know and i think that's why you're going to be tremendously successful i'm taking notes good to see you brother thank you congrats on reddit you man yeah i appreciate you too and we'll see you all next time on this weekend service bye bye

SPEAKER_15: hey when your business gets to a certain size the cracks start to emerge we know that it's all that stress from your amazing success things you used to be able to do in a day now it's taking a week

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SPEAKER_17: this week in startups i am here at the eye connections global alts conference with

SPEAKER_197: the founder of the patriarch ron scarty how are you sir very well good to have you here for people who don't know you run a conference it's called global alts it's in miami thousands of people come

SPEAKER_198: here yeah and then there's an app called eye connections where they all get together and set up meetings who are these people why have thousands of people come to miami to take meetings excellent

SPEAKER_200: question eye connections assembles the alternative investment industry so there are about a thousand

SPEAKER_201: institutional investors so think family offices endowments foundations pensions sovereign wealth funds all those entities that put money into hedge funds venture funds private equity private credit

SPEAKER_203: real estate that's the other side of the event collectively 4362 people are registered here for

SPEAKER_204: global alts amazing and uh i got to speak at your new york version of the event i came to miami

SPEAKER_10: miami's much bigger much bigger and for a fund manager like myself i didn't even know this existed you reached out to me at some point uh you know my bestie chamath it was really incredible for me because

SPEAKER_198: i'm raising a fourth fund there's so many people interested in alternative investments and what you've done here is really magical i think you have a little bit of content a lot of nightlife and parties and you know events people network but really the meat and potatoes the foundation is people have booths or rooms and the app people can request meetings and the lps the limited partners

SPEAKER_18: get to take 30 minute meetings with the gps and you run some sort of algorithm at the last minute

SPEAKER_203: and it just sends people to rooms yes exactly so it's too cumbersome for 4 000 people to calendar all

SPEAKER_201: of this so everyone just picks a time slot or they tell us where the open time slots are on their calendar and then our algorithm runs about a week before the event and it plugs in all the meetings and we do that so that we can cluster the meetings for the lps because the lps are the ones who are doing the walking the gps are stationary in a booth or a room and this way we don't have the lps walking end to end you can see we're here at the fountain blue and the eden rock hotel it is a massive campus yeah and the only way to navigate that is if we keep those meetings close together yeah and i've experienced that

SPEAKER_17: because i went to the wrong building i had to go double back but once you get settled and you get

SPEAKER_198: into your rhythm it's great so maybe you could talk about we went from a zerp environment it was insanity the market collapsed you're running this conference for the two years during this market turmoil 2022 2023 here we are in 2024 and the vibes seem different as somebody who coordinates all this activity

SPEAKER_201: what are the vibes telling you going into 2024 uh so there is no question the alternative industry went through a lot of turmoil in 23 especially in q3 and we saw it in clients just telling us the war story of trying to raise money in an environment where 22 or 23 in 23 mainly because as interest rates have gone back up allocators are now rejiggering their portfolio because for the first time in 15 years you can actually have a bond portfolio places in the portfolio where they probably used hedge funds in particular they're now rethinking does it make sense to put this capital in that kind of vehicle should we be in more of a traditional fixed income vehicle as a lot of that change took place things really slowed down and fundraising was much much tougher uh for alts in the middle of the year but november the market did well december took off we have been inundated in the last two months with signups on both sides lps and gps we have over a thousand lps in this event it's up about 100 to 150 over last year on the gp front we're up about 25 percent in terms of the funds that are over a billion and about 20 percent overall so the activity in alts is not slowing down but it is always shifting traditionally long short equity was always our biggest category in this event this year it's about 20 25 percent versus in past events it was probably more like 30 35 percent private credit absolutely huge everyone wants to meet with private credit they are getting more than their fair share of meetings because lps really want private credit private credit so attractive at a time like this well the interest rate moves have had a huge impact on private credit and the the rates that these funds are able to charge and the market opportunity has just exploded because banks are still really difficult to do business with especially if you're like a small business even approaching the mid-market there is still if if you don't have real assets to lend against collateral that the bank can identify they are very tentative and not moving quickly at all so these private credit funds come in they are going to charge you a much higher interest rate 15 15 16 absolutely those kind of numbers but if you're growing business and you just need the capital it's still a lot better than raising

SPEAKER_105: equity and probably much much faster yeah so the interest rates go up people are questioning private equity venture those portfolios are being cleaned up you know obviously i'm in the venture industry so i've been watching that i'm early stage so i get a little bit abstracted from the later stage where

SPEAKER_218: that mess was you know in the process of being popped up yeah clean up aisle eight you know growth funds just everything fell off the shelves but as the rates went up hey if you were if you were

SPEAKER_129: sitting you're a sovereign fund you're an lp you're an endowment yeah you can give somebody you know

SPEAKER_197: a hundred million dollars and they guarantee you 15 a year that's pretty great i mean that's spectacular

SPEAKER_203: yeah it hasn't existed in a long time existed yeah for the private credit funds the interest

SPEAKER_105: rate move has absolutely been a win yeah but now hey they say three four rate cuts this year

SPEAKER_197: uh you know maybe mortgages leveled off maybe start going down so then you'll see that maybe taper down

SPEAKER_18: and then maybe people get frisky and want to be back in equities back in private companies yes oh

SPEAKER_201: absolutely i mean i've been running these types of events for a decade now and there is just a constant shift in strategy focus for the lps and they're just adapting their portfolios to whatever the market

SPEAKER_203: environment is so for sure i mean i i think we're probably if we're not at a top in private credit

SPEAKER_197: we're we're probably close it feels like this is the top because hey we're going to have an interest rate cut sometime in the spring or summer is like i mean hopefully yeah that's what people are saying but

SPEAKER_105: hey i mean the economy could heat up again so overall when you look you know let's go to a 10-year view

SPEAKER_197: we're just if we're sitting here in 2034 and uh we're looking at the markets what what things do we know will be true about the trends that you're seeing now what can you extrapolate out and say you know what we know this trend is going to continue and we know this trend is going to continue i don't

SPEAKER_200: know that i'm qualified to give you a 10-year projection with any accuracy but i i will tell you

SPEAKER_201: the the uh one talk that really resonated for me was brad kirstner's yesterday yeah i think brad um looking at the venture market your market and how companies have had to become fit yeah i think

SPEAKER_234: his term is his term for capital efficient would be a translation to what he means exactly yeah exactly

SPEAKER_201: uh companies have had to operate probably in a more traditional form than they had been operating leading to the peak in 21. i think this is probably one of the best markets in a long time for venture money to be put to work however venture funds have been having a really hard time raising money you know the last two years have been tough i think a lot of that has to do with the lack of exits because lps are saying look we need the exits from your last couple of funds to be able to fund the commitments

SPEAKER_200: you want us to make in your future yes so the and those have been delayed a bit for sure because

SPEAKER_10: public markets are a little bit tight but hey we have reddit and hey well there's a you know story that is almost 20 years old 15 16 17 year old company i think it started in 2006 or five or six

SPEAKER_18: and now they're going public here hey almost 20 years later so absolutely it can take time and it will

SPEAKER_201: take time and again i can't predict the markets but i can tell you the sentiment i'm hearing is that people are very optimistic that the ipo market will begin to loosen up and and open up ultimately

SPEAKER_225: yeah i'm hearing second quarter third quarter i think reddit will obviously be a big indicator

SPEAKER_17: yeah stripe reddit there's a whole cohort waiting to go out and that could open things up

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SPEAKER_10: that we can both agree is not stopping you have sovereign wealth funds that you know we're kind of on the

SPEAKER_197: periphery you know you might have some sovereign wealth fund in the middle east or you know in asia

SPEAKER_18: that puts money into a fund of funds okay fine they're getting access to getting into some private equity fund you know and they maybe get access a step removed or two steps removed but now we're

SPEAKER_197: starting to see those same i think sovereign wealth funds show up here in person yes so i had a great conversation with uh you know somebody from abu dhabi last night as about one example this isn't just an

SPEAKER_18: arms-line transaction anymore maybe you could speak to what you're seeing in the numbers of attendees coming from the middle east southeast asia china india where are people coming in we have sovereign

SPEAKER_201: wealth funds from all over the world at this event i think the total attendee count from sovereign wealth funds is somewhere between 20 and 30 but they are super active and there are some sovereign wealth funds who absolutely went through fund to funds vehicles who are now taking direct meetings with fund managers and also doing direct deals you know obviously at a larger size but there is huge interest among sovereign wealth funds they are i mean we can get you the meeting count it's hundreds of meetings happening across that collection of sovereign wealth fund attendees so

SPEAKER_225: and by the way across all categories they're meeting with venture funds private credit private equity you name it yeah i mean obviously they have huge portfolios so they kind of have a need for

SPEAKER_105: everything yeah and then when we look at the classic endowments uh here in the united states it feels like those classics their dance cards are filled up so to speak maybe they don't come to an event like this maybe they're you know been doing it for 50 60 years they're not adding new managers they're maybe

SPEAKER_129: kind of locked into a system of investing and they don't need these new alternatives am i correct in

SPEAKER_201: that assessment so i'll say this they are definitely slower to deploy capital they're incredibly selective and they may select just one or two managers a year if that in a 10 billion dollar portfolio but they are coming to this event in big numbers we have about 70 endowments and foundations here because they're using this event to keep funds that are interesting for the future on their radar they

SPEAKER_200: will meet you and they will track you and then of course this is not a quick sale cycle as you i'm

SPEAKER_18: learning yes because my business has always been oh we're friends uh you know ron wants to be an lpmi you know tiny 10 million dollar 40 million dollar fund okay no big deal but once you get about 50 million you may have to have a process here you may need to expand the pool yeah and they do take years years

SPEAKER_201: years literally years so i had a talk earlier with ted seides here and a capital allocators podcast he's amazing great podcast and we were talking about how ted asked can we track the results of this event and we do a lot of things to try and get a sense as to what happens after the event but the reality is for a lot of funds especially emerging managers you have to be in this for the long haul and you have to expect this is a multi-year sales cycle you're not going to meet yale or princeton or hewlett and expect you know next month they're going to be cutting a check that does not have a family office

SPEAKER_197: if you meet the principal perhaps perhaps perhaps high net worth individual certainly yes you're

SPEAKER_10: you're meeting with the direct decision maker but there's an entire class of people in this capital allocation field referred to as lps limited partners they are answering to different constituents

SPEAKER_129: internally yes and they have to build up a case and the way i heard it recently was hey you never

SPEAKER_18: got fired for investing in x we used to say in technology hey nobody ever got fired for choosing microsoft or ibm it was ibm originally then became microsoft so there is like sort of safety in brands you know if they're going to take a new brand on they need to check some boxes what are those boxes they need to check to get comfortable if you were advising somebody like me or another vc fund manager i know she had sophia amorosi here and some nicole wishoff like some emerging managers very small funds 5 20 million dollar funds what's the advice for how do you nurture those relationships with lps and what are the check boxes they're looking for well i can tell you when we run our investor

SPEAKER_201: surveys one of the top issues uh related to this is your investment process and how much business risk do they think they're taking when they make a commitment to you so for emerging managers the business risk is really the number one issue right what does it mean in english business risk we know

SPEAKER_271: what a risk is we know it's a risky in business what does that mean practically so what they don't want

SPEAKER_201: to do is making a commitment to a 200 million dollar fund run by let's say it's two or three uh individuals who got together to form this fund and they've only worked together for a few years and you know what they don't like each other that much they break up they break up the band breaks up the band breaks up and now i've got you know i've made a 10 million dollar commitment who's managing it what happens what happens to this fund yeah no lp no succession planning what happened well what happens is some form of a wind down and hopeful hopefully capital return frankly it's much easier when it's a hedge fund because you know the portfolio is more liquid you sell the assets you return the capital it's not

SPEAKER_203: a 10-year window right when it's a new venture fund or a private equity fund it's a much bigger issue because someone has to watch over a sophisticated person yes exactly yeah so i've been on the other

SPEAKER_105: side of this call there was a there was a high profile collection of startup investments i'll leave

SPEAKER_18: it at that and uh it kind of imploded and i got the phone call hey would you take this on yeah and well i didn't make any of these bets i don't know who these founders are thank you i'm flattered but no like that sounds like catching like 200 knives like catching one knife hard enough you know there are

SPEAKER_201: circumstances where it could benefit you to do it but from the lp standpoint if you are inside of a large institution and you're part of the investment team and you made this recommendation and then this happens oh no i got on the face not great so now if it's a family office and you dealt with the principal at least it was the principal's decision yeah and it's their they made the bet they made the bet it was their risk they took it uh but for this reason larger institutions want to track emerging managers for long periods of time you get to know them three or four funds absolutely three or four funds now not to say that it never happens you'll certainly see spin outs from brand name firms with someone who they've known for a long time as part of a bigger this person was a partner

SPEAKER_105: at sequoia or kleiner or they worked for chamath at social capital then they started their own fund

SPEAKER_197: exactly okay i i watched you do this investment i know your fingerprints were on it hey we're gonna go over

SPEAKER_201: here and they've spent time with these people yeah you know if you're inside of a fund and you have visions of starting your own fund one of the most important things you can do is meet the lps who are in the fund you're working for because those will probably be at least some percentage of your initial

SPEAKER_129: seed capital rod people don't know this but you're done incredibly well for yourself you're allocating your own capital i'm fighting the fight every day you're you're out there inside things are going very well for you i could see here where do you allocate your capital uh you see all this and so hey you know uh what what how does the dot what medicines does the doctor take you know for for us i would

SPEAKER_201: say we're allocating to strategic partners primarily that is a big focus for us if it's a fund that's an interesting spin out like i'll generally we don't talk about our portfolio investments but one that we invested in because we thought it was a really interesting new area that's that we think will absolutely crush it is taking advantage of social media influence and kim kardashian oh yeah last year

SPEAKER_129: i got to interview kim and her partner jay sammons they just uh in their private equity firm i guess did

SPEAKER_200: their first deal it's a hot sauce yep exactly got a hot sauce and and the truff founders were here over the truff is it called yep truff truff truff hot sauce truffle hot sauce oh i understand it yeah there you go truff hot sauce all right free plug so when you think about what an entrepreneur is

SPEAKER_201: looking for when they source capital they want of course they need the capital itself but they also want business experience and relationships and assistance because as we all know building these companies is incredibly hard when you go to a firm like sky partners and you partner with kim and jay and now you have kim's influence and prominence in the marketplace and ability to

SPEAKER_251: drive customers towards a consumer yeah at least to try it yeah still gotta be good people in the

SPEAKER_201: world who can do that yes what kim can drive so that's an example of an investment we made and of course we love having jay here taking meetings with investors and the truck guys here doing you know

SPEAKER_233: for those so we look at it we look at deals that will help increase the visibility of our event and the prominence of our event so so there's a strategic and then there's the uniqueness yeah that's a one

SPEAKER_200: of the things you look like you look for exactly and then of course you have guys like brad gerstner

SPEAKER_203: at altimeter yeah another firm that we invested in you know brad's in the hall of fame of venture

SPEAKER_200: investing yeah it's done pretty great snowflake is uh you know you and it only takes one right and that's one of the that's an example of one where we're really appreciative that brad was willing to

SPEAKER_166: let us join yeah yeah and so where does this all go next i mean miami's great you got new york where

SPEAKER_105: are you taking this all it's a little confusing too you got the global alts brand you got the

SPEAKER_203: eye connections brand i know i know brad actually suggested i just change the company name to global alts he said i can actually just too confusing what do you think i think i connections is the global

SPEAKER_18: alts app i'm always a fan of like less brands yes yeah so i think you can consolidate it

SPEAKER_257: i'm sure why not global alts sounds more like what we are which is true it is true i connections

SPEAKER_18: is an awesome app uh you guys have been racing to keep that app up and running i see updates every

SPEAKER_38: day i know it's a lot of it's hard to build an app a great app isn't it it is and the whole thing is

SPEAKER_201: custom built so but here's what the future is for us especially you know the first half of 24 we're taking the app and expanding it outside of events you know it and pretty much everyone knows it as the app they use to coordinate 20 30 40 meetings when you come to an event we support about 20 events throughout the year this being the biggest we're going to take the app and add a roadshow module so that when you go to new york and you do 20 meetings in new york and you have to coordinate schedules and travel time and all that oh wow brilliant we're going to help you do that and back that up with a concierge team so you'll be able to call our concierge team and say book my hotels book my car book my plane and if anything goes wrong during the road show you'll be able to call the concierge to rejigger your schedule the concierge is a great idea but the introductions

SPEAKER_197: is really the power like i have an assistant to help with that i mean for us that's the logistics of

SPEAKER_201: the concierge will be new but the relationships of the lps we already have those yes so if theoretically

SPEAKER_105: let's say i'm going to boston new york whatever would you be able to then i say to you just

SPEAKER_199: find me 20 interesting people in each city you enter your roadshow into our system and it would

SPEAKER_201: message all of the lps who have downloaded the app and tested that they are accredited investors and qualified purchasers they would see oh jason's coming to town on well i love that september 25th

SPEAKER_315: yeah i'll take a meeting with you so that make that starts putting you into this like broker

SPEAKER_197: kind of category but you don't you can't be a broker so we're that we're definitely not a broker you're not trying to charge a commission on that it'll just be part of your membership or something

SPEAKER_200: exactly it is in a sense like calendly on steroids i love it i i'm just trying to ease the logistics

SPEAKER_201: of all of these people who are members of our community but no we absolutely like davos has a

SPEAKER_105: membership exactly you have a membership for global to get meetings it's the same exact thing i love

SPEAKER_197: this i love this vision for it because you know i i've been making these trips and trying to meet folks and you don't know who you don't know right and that that's always the hardest part is like if

SPEAKER_18: you're an endowment from a college and you're on this list of the top 50 or 100 you're getting hammered yeah now you're i met a couple of really interesting family offices here that don't have websites they don't have they don't tell you their email addresses everything is you know very cloak and dagger yes but you have those folks and yeah i think that's like a really special thing especially if they can double opt into it hey i'm going to be in town and this person's in baltimore philly and new york

SPEAKER_199: hey yeah why not go have uh dim sum or something absolutely and the remember and especially uh when

SPEAKER_201: you get to a few hundred million of aum and a family office there's generally a team of people so someone's job is to know who's coming through town what are the funds that are out there actively

SPEAKER_200: raising money so and you're going to them in this circumstance so it's pretty easy you're going to pop into all right you're going to their conference room easy breezy they're there anyway it's a coffee

SPEAKER_201: in their conference room for a half hour yeah they get an update if they've already met you or they're learning about you for the first time but it will it will make everything more efficient because all of your information will be contained in the system the same way it is for this event so the lp

SPEAKER_257: will just have as part of their allocator portal your information that you choose to share with them

SPEAKER_105: yeah because i did notice that too like i share my phone number i'm just like hey whatever yeah let's go um i can always block you if you get weird um it has gotten weird sometimes um and uh

SPEAKER_200: by the way how did you like the did you notice the business card exchange that we added yes i had a

SPEAKER_201: bunch of people go scan yes exactly so we exchanged 22 000 business cards whoa before we got to miami sweet because all of the we did you know we're doing 15 000 meetings here in two days the participants decided you know what yeah let's let's exchange our information so if anything comes up i can call

SPEAKER_332: your cell i can email you wonderful you know yeah that was something we had talked about i was like

SPEAKER_333: hey i mean if you can't find me in my booth or that i stepped away from the booth can i just put the phone number in here and you were like uh yeah so i was giving me a little product i want my product

SPEAKER_316: team to get upset with me but you may have had something to do with that idea yeah well i was like

SPEAKER_198: hey it's supposed to contact people like i mean i i'm okay with it i don't know and i think 90 of

SPEAKER_201: people are okay with it most people are you know they i would say the allocators to your earlier point who are inundated with calls it's hard to be emails yeah i mean they these are people who are literally getting two three hundred emails a day from the funds that are trying to get to them

SPEAKER_105: they are more protective i'm in that i'm in that i think i get that but with founders and i think the way you have to look at it is it's a sign of success that people want to participate with you

SPEAKER_284: so whenever i see a vc you'll see a vc lose their mind once in a while and they'll go on twitter

SPEAKER_198: don't email me blah blah blah if you you should always do your research first and know that i do this sector and i'm not in that sector and then i do this stage and i just think oh that's the end of their career like they really don't care like here's another idea you get 100 emails in the morning feel blessed and then delete the ones that you can't respond to or just archive them and you'll get to them someday if you want to and then the ones you do reply to them or another crazy idea you have an assistant or an associate have them read your email box and sort them and do a first level sort for you but don't under any circumstances be upset that the world wants to want to meet with

SPEAKER_201: you wants to meet with you yeah people get weird no well i think they're just overwhelmed and i know like i'm terrible at organizing my inbox so it it would drive me crazy for sure but in general

SPEAKER_203: everyone has to just like take a breath we're all lucky enough to be in this industry we are super

SPEAKER_342: fortunate everyone at this conference this is incredible yes i mean like to be worse than my email

SPEAKER_203: box is a little overloaded boohoo yeah i know it's pretty hard we are trying to overload it less

SPEAKER_198: i mean this is like people who complain that like their apple tv it's like three or four clicks to

SPEAKER_18: get to the movie they want to watch and when we were growing up it was like wow i wonder if this star

SPEAKER_38: wars is ever going to come out on vhs or if it's ever going to be on tv we have to have to watch it

SPEAKER_18: with commercials i have to watch it with the commercials and they edit out all the good scenes if you were giving a piece of advice or just assessing what are the qualities that make a great lp two or three and what do you think the great qualities are of gps if you think about those

SPEAKER_09: two things take a minute to think about it because there's two sides of the table here

SPEAKER_201: it is but i'm actually going to give you the same answer for both here we go it is build relationships and you build relationships by paying it forward i have done really well in my career mostly because i was nice to people i helped people i didn't ask them for anything and all of those favors came back to me in droves i think it's basically the same idea if you're an lp a great way to make sure that you're in the best stuff is to build relationships right if you know the right people if you have the right network and by the way this is all super long-term stuff this is not a business if you are a naturally like super transactional person i don't think this is really the best now for you it's it is such a long-term play if you're an lp and you want to build great relationships you have to make a lot of friends along the way yeah and being helpful and doing favors and not asking for anything in return is a great way to do that and if you're on the gp side it's all about deal flow right it's like i want to get access to the best deals it's it's the same concept it's helping people that are going to help bring you into deals send you deals in the case of a gp it's really about the service provider network right yeah making friends with the lawyers the accountants the investment bankers when you know it's such a simple thing but people do business

SPEAKER_332: with people they like and like they don't teach you this in school they don't like also they don't

SPEAKER_129: teach you this you know our relationship is based on the fact that you just when you met me you were like hey i think i could be helpful with a couple of things here and i really appreciate what you do

SPEAKER_197: and i was like oh my god that's literally one out of a hundred interactions i have the other 99 are

SPEAKER_105: i'm glad i was one out of a hundred no the other 99 are hey um you know this person can you get me a meeting with them or hey you don't i'm just like oh yeah sure well let me just check my punch list here oh yeah let me just put you right at the top i have nothing else going on it's just crazy uh

SPEAKER_338: listen ron uh you're a mensch thank you so much for inviting me you treat me so well when i come here

SPEAKER_203: i really do appreciate having you here thank you i appreciate it all the besties obviously and we love really partnering with you yeah well you uh sax and freeberg and shaman yeah it's been a great

SPEAKER_284: relationship so thank you guys continue success your team is amazing awesome and we'll see you all next time for this week in starters bye-bye