The Sales Hacker Podcast
The Sales Hacker Podcast

Episode · 3 years ago

73. What Venture Capital Investors Want w/ Semil Shah

ABOUT THIS EPISODE

This week on the Sales Hacker podcast, we speak with Semil Shah, General Partner at Haystack and Venture Partner at Lightspeed

Semil has made a name for himself as an “observational leader”; someone who shares what he sees on the ground and passes it on for people to respond to, benefit or learn from. He’s also one of the most well known and well respected writers on venture capital and early stage investing.

One, two, one three, quote everybody. Sam Jacobs, welcome to the salesacker podcast. Today we've got a very special guest. We've got Samuel Shaw, who runs haystack ventures, is a venture partner at light speed and has made his name and a name for himself as one of the he calls himself an observation leader. Some people call him a thought leader, but the point is that through his writings and through his observations on what's happening, particularly in the bay area, around seed financings, he's become very well known and his investments have included managed by Q giffee, among a door d among a number of other companies. So he's made a name for himself as a fantastic early stage investor and he walks us through the current climate and investing in Silicon Valley in the bay area, his perspectives on what it takes to great to build a great team. I think a lot of you know, if you're out there and you're not a founder and you're an employee, you're a salesperson or any other kind of function, and you're listening to this, I think it's really important for you not just to sort of idolize all of these people that are vcas and investors, but to really understand their perspectives, what they're incentives are and where they're coming from and understand that, whatever your conclusions about where they're coming from, whether good or badder or indifferent, but you have to understand how they approach their world, because so much of how they approach their world impacts how how you are treated at your company indirectly, and so it's a really important lesson to learn. So I think it's a really interesting interview. I before we get started, we want to thank our sponsors. The first is lucid chart. Lucid Chart Sale Solution is the leading account planning platform for modern sales ORCS. With lucid chart you can visually map out key contacts and crucial account data to uncover critical insights that will allow you to close bigger deals faster. Go to lucid chartcom forward sales from more information. Our second sponsors outreach. That's outreach, the leading sales engagement platform. Outreach support sales reps by enabling them to humanize communications at scale, from automating the soul sucking manual work that eats up selling time to providing action oriented tips on what communications are working best. Outreach has your back. Now, without further ado, let's listen to Samuel Shaw on the salesacer podcast. Pay Everybody, it's Sam Jacobs. Welcome back to the SALESACER podcast. Today we are incredibly excited to have some Eel Shaw on the show. If you don't know Samuel, maybe get on twitter follow him. He's a thought leader in the venture capital space and one of the more wellknown and well respected both writers on venture capital, but particularly early stage investing his bio really quickly. He's a general partner at Haystack, which is the fund that he started, as well as a venture partner at life speed haystacks, a proud early investor in instant cart door hired Hashy, corpy shares, Giffy, open door, chariot, managed by q and many, many other companies. I believe, similiant, you're recording this from somewhere in the bay area. If not my if I'm not mistaken, welcome to the show. Thank you, Sam from San Francisco. I Love San Francisco. So, Samuel, you know, we like to start with sort of a baseball card. There's a lot of folks, a lot of the folks that are listening, our salespeople and operators that may not be, may not be is as in tune with what's happening in sort of like the VC thought leadership space as as maybe they should be. So first of all, tell us, you know, I told I said, you know. Here's your title, General Partner, Haystack. Tell us what is Haystack? Yeah, Haystack is a, you know, shocker seed fund. There's a lot of seed funds out there in the bay area. We invest primarily in the bay area, with a sprinkling in the York, in La little bit in Seattle. You know, we like to be when the entrepreneur might raise two to three million dollars as a start out, being a part of those smaller rounds, those earlier rounds. That's the stage that we like to work with companies and feel like we have some success and we don't, we don't need to apply a lot of capital to that. One correction I would make, as I've been on podcast sort of pushing back a little bit on...

...this thought leader Moniker, I think I've been very fortunate on twitter either to have people read what I'm writing and interacting with me and it's been really fun and educational for me. I don't try to lead with thoughts. I try to share what I see on the ground and then put that out there and then have other people respond to it or benefit from it or learn from it. But I would say I'm more of an observation and leader. I don't I don't really know where things are going. You know, I'm sort of a dog chasing cars. I think what people have found value in as that, oh, hey, Samuel, he's on the ground and he's seeing a lot of this stuff and maybe I can connect some dots of people can't when they're not here, and I think people have found value in that and I hope I've been consistently doing that. I personally have found value. So thank you for being an observation later. Okay. So you know, in terms of like describing the characteristics of Haystack, be signs that, besides the fact that it is a seed fund, is there a standard it is do you? Are you writing two to three million dollar checks, and is there a committed fund size that you that you describe or articulate, or we pretty we primarily invest two hundred and fifty K to fifty K in the early rounds of companies. We try to have a really we want to have a relationship with the founder that we're backing or founders that we're backing. We want to work with other CO investors that we know. We want to get paid for the risk we're taking. We want to have some geographic diversity in the portfolio, because a bay area is getting very saturated and super excited about New York in La and we're not sector you know, we're not sector focused. We believe in we're investing in people and we want to meet tons of new people and find ones to hitch our wagon to. It's kind of that simple. What is your relationship? You know there's a lot of folks out there. Well, I'm one of the folks. I'll speak for myself. I'm never quite clear on what venture partner means. So what is your relationship to light speed is if that you bring them certain deals or how does that work? Yeah, so let's take a step back, or two steps back. One is the terms, Eire entrepreneur and residents or executive and residents or venture partner can mean different things at different funds and as the VC industry has grown and more people are in venture and then doing these roles. They're kind of like all apples and oranges, so to speak. Right No, to know two while are alike. What I would say with me is the reason I'm in that role, which is a very unique role. I can't think of anyone else in the bay area that's with a kind of brandname platform fund and then has their own fund. It really goes back Sam to the origins of how I started when I started this small fund about six and a half years ago. I started it primarily because I was consulting with a lot of these funds and I thought that one of them would hire me and I was working at a company and the company got bought. There was like this acquisition and I had a job at the new tech company and I really wanted to pursue investing and so I didn't get the job I wanted and so luckily had a couple friends pulled me aside. They said start a small fund, be a venture partner with one of the funds you've been consulting with. So for the first two years as a venture partner with bullpen, they do postseed and small series a kind of in New York, La and San Francisco. Then I start, you know, two thousand and fifteen, I started to get a bunch of offers to join these big firms. Finally and then ggv pulled me aside. There about an eight billion dollar under Management Fund across China and the US and said be a venture partner with us and keep doing your own fund. So...

I did that for three years and then, you know, I've known, I've been really fortunate to have the investment and mentorship of a lot of people who have created incredible funds like bullpen, like ggv and and lights beeed, the founders of lightspeed were investors in one of my funds and so they said we want you to be a venture partner with us and come over here. And so, you know, I go to the partner meetings on Mondays on part of the sector groups that meet and you know, all all those funds, bullpen, ggv, lightspeed, are very have been very successful. The very different in terms of their style and focus and how they prosecute deals and run and lightspeed currently is just on a tremendous roll, probably one of the best wellknown consumer practices out there and in terms of returns on the cloud and infrastructure side almost unprecedented. So for me it's just an amazing learning experience. And Yeah, when deals come downstream or I have a feeling about an entrepreneur, I'm able to bring them in, but it doesn't mean that I automatically get the deal. There's a lot of competition for that. So, to kind of put a point on this story is the reason it happened is because that's kind of how I started and no one, no one really cared to take notice. How did you know that you wanted to be an investor? What was it about the work that inspired you got you so enthusiastic? Well, the way it started out, and you have to rewind the tape a little bit. I was working at companies and I was writing a lot online on twitter, Cora. I did some guest posts on Tech Ronch. I had my own blog when I was just doing it for fun, and a lot of people started to read it, cite it publicly, share it and social media and it kind of became kind of peer reviewed in a way, and I found that a lot of the people signing up and subscribing to what I was writing by email happen to BBC's, and so they would reach out to me, I would get to know them, one thing led to another and I became like like a consultant to a bunch of them, and so in the back of my mind I always thought, you know, hey, this could be a really fun role but also one that would leverage, you know, what I think are my capabilities. Only until I started doing it, like in the first six and nine months, did a click where I was like, Oh, I actually love doing this, you know. So I hadn't intuition about it, but I didn't know. And then, you know, I was like thirty four, thirty five at the time when I started and it was just like, Oh, I love doing this, like I wish I had known that earlier, right, and so that's that's kind of how it went from like, you know, the germination of that seed. When you say you love doing this, what is it that you love specifically, because I'm sure there's a lot of folks out there that are thinking maybe I want to get into VC and they have to probably do some introspection and, you know, take some inventory and figure out if they do have the skills. So what are the skills and what are the passions that really light you up? Yeah, I mean I think I would give like a very dancer to this. I think there's something about the context switching and meeting New People that I really like, and sort of like your broad and a number of things, but you're not super deep and anyone thing. Now you can take that to an extreme where it's bad, but I'd like that variety. I think you have to you have to have some kind of network or reason that people want to seek you out, especially in a world of abundant capital, and so just saying you want to be an investor without having a network or deal flow, I think is really difficult because those people now, especially in the bay area, they have options of where to go and so you almost have to be selected or invited to participate. That's just kind of...

...like how the market is. I think another attribute, and maybe this is an interest to your audience. A lot of ventures can be like sales. Bill Gurley from benchmark has a segment that he talks about this with I can't remember the interview, but it might have been old interview series he did with Sarah Lacy from Pando daily. Yeah, or he basically said that, like a lot of venture is about sales and if you don't like sales it can be kind of difficult, and so I've seen people come in to venture where they just they don't like that element of what a salesperson would do and find it kind of frustrating or less inspiring than they thought. You know, those those, I would say, would be like kind of elements that's needed that you'd ask a question before. Why do I like it? I like it for all those reasons, but I also like it for a selfish reason, which is I feel like today there's a lot of you know, there's no cost for speculating or writing a prediction post or tweeting about what do you think something's going to be, and I think when you invest you can put a marker down a little bit and kind of say, Hey, I believe in this potential outcome and you can stand behind it whether it works or not. So I like the betting nature of that. I also just like the game of discovering things early, especially when it's a crowded environment and you can you can pick from the flow and then other people who see your deals later say how did you find that or how'd you see that. I think it's like a it's like a Russia dopamine, you know, to feel like people are valuing your judgment. Did you know that you wanted to be in seed from the get go? Was it a was it just you know, I those were the only options, or did you specifically seek out that stage of investing? That's just kind of where I started and then where I felt comfortable. And then I'd had the benefit of working with a lot of series a investors who join the boards and do deeper work with fewer companies, and I have a lot of friends who are in that role and kind of what I learned about one their work and then too, how I like to work. It seemed like that was a big sort of fault line between what you're signing up for, is an investor, and I felt much more comfortable staying within seed then graduating to the A and being being a board member. I just actually think it's a completely different skill set and experience set required for that and I felt like I was better suited to seed. You've done this enough at this point. How do you determine, because seat is such an early stage in the outcomes of the company are so potential so variable. You know, what are the what are the heuristics you've developed to to find that founder that you want to back? Well, they're kind of two questions stuck in there. One is a one is the founder pattern or prototype, and the other one is like how do you how do you control for a chaotic environment? I'll answer them in reverse. In an environment, especially like today, what I try to do is control what I can control, which is who do I choose to work with, how do I choose to price things or, you know, the discipline to say no to things that I think are mispriced or not have enough upside, and then to to take as many shots on goal as a fund allows me to take to smooth out the randomness of the of the outcomes you alluded to. That's especially important today because we're in a capital in the bay area, a capital abundant environment. In terms of your first question around founder pattern of the way I describe this as more like if you're playing a video game and your character has, you know, like a life meter of a hundred right at the start of the game. I want the...

...founders I'm looking for have that in the sense of it's the life meter is made up of some combination of industrial technical insight and Acumen, plus evidence of entrepreneur real behaviors, attributes, tenacity, grit, things like that, and so it's very hard to find someone who's kind of got equal parts fifty and just off the charts what you end up finding, and it's really easy to find people have none of those things. What's really hard as like the judgment between, oh, someone has a lot, a lot of technical insight and maybe you're not really sure how entrepreneurial there or the or the opposite. They're just losing entrepreneurship and you know you're you're seduced by that, but then you're not really sure if they know the direction they're headed in. And so what what I'm always looking for is like who can get as close to fifty as possible, knowing that an absolute fifty is is probably not possible, or like a Steve Jobs and then just understanding what that blend is before going in. And so a lot of it is like getting to know the entrepreneur personally and behavior eally, and then also like testing their own insights and depth of insights. Are there any questions that you tend to rely on because, candidly, your assessment of a founder might be the same assessment that an employee has to make, which is, is this person the person that's going to lead us to the Promised Land? So when your are there specific questions that you ask and a set of answers that you're evaluating? Yeah, on the on the side about like testing technical in or like industrial active in and in site, I think that's just revealed in conversation and how they structure information and make arguments and you can kind of tease that out over a couple of hours. The harder one is like are you entrepreneurial in nature? And you know that's like, I don't have specific questions, but it's more like trying to understand the person. Like it could even be in their personal life. Have they overcome adversity or hardship? Had they had to cut corners on things and make things work? Had they started something before? You know, all these sort of behavioral questions of like trying to assess like what is the nature, kind of like the Marcus or really a question like what is it that you covet? What is what is in your nature type thing that's really hard to get to, especially when you're getting to know someone quick but you know, if you meet someone and you're kind of getting interested and then you get to know them a little bit better and then maybe don't have the pedigree or the experience that you're used to and they kind of say, you know, hey, I was raised by a single parent and you know, my younger brother was a paraplegic and took care of him. I'm just making that up, it shows like a level of adversity and prioritization that you could say, okay, this person has had a very different life experience that's going to make them approach work potentially in a different way. Right. And so those little stories, whatever they are, are helpful to understand because it gets to like the motivation of why people are doing what they're doing. Do you have do you ever sort of to put a I'm sure there's a nuanced answer to this, but do you have an aversion or an indifference to people that, to that point, maybe come from a tremendous amount of wealth? Maybe you know, is that like are those negative indicators before you meet people, sort of like their backgrounds? If it was too cushy, too comfortable, too easy to be honest, I don't really meet those people that much. I mean occasionally, but usually the people that I end up meeting there's some like chip on their shoulder. It could be that those other people are going to like larger phones or different funds. I don't I don't see that as often or I don't engage...

...that long. You know, I don't want to stereotype people. I think you know it's possible to get to come from any background and do that stuff, but I definitely, I definitely feel it and sense it when you learn about and again, it could be any kind of adversity right. Like I just got reconnected with a friend yesterday that I helped who's in the military and literally literally fought against Isis and you know he's a very unassuming guy and now he's working in venture. But you know, you can imagine someone like that just like the ethic of how they approach work right, it's just going to be different than other people. I think, you know, the listeners are probably interested in some of the basic math. You know, you mentioned that you have to be prepared to fold when you're making seat investments and it has to be priced correctly. Walk us through, you know, why why pricing is so important and also just curious on your take. You've sort of alluded to it, but on the current market environment, both in the bay area or anywhere that you're looking at deals, in terms of your your assessment of price to value. Yeah, so the bay area right now is crazy. I've never seen it like in my six and a half years and never seen anything like this. It's sort of to fold. It's like deals are get bit up pre product or pre launch, based on the pedigree of the team and and People's belief in the sector, to the tune of, you know, lots of millions of dollars before there's any proof, and then the rounds that are where the company is working. Those are fully priced. So it's just the bay area is like a different country right now, I think. I what I hear from people in La and New York is that there is increasing competition for for some investments, but nothing like the bay area. In terms of why pricing is important, I would point people to the twenty minute VC podcast with Brian Singerman from founders one. His belief, and I believe it's true, is like the only thing that matters is being in good companies. And controlling your entry price on the price for share basis. So like if you were to invest in the series these be of coin base versus any random seed company, you're probably better off investing in the series B of Coin Base. And so a lot of people, you know, don't think of things that way because they're either saying seed focus or that's where they like to work, or they don't have a chip stack big enough to go across stage. But I do believe like controlling your entry price is the only way to drive multiples. Give a pricing framework, I mean is it? Or is it sort of a as much artist science in terms of understanding traction and things like that as a point of trying to figure out what is the right entry price at see, no, because the seed market is distorted with the amount of companies and capital. So what I do is just kind of say, if the valuation ends up being over ten million as our entry price, there has to be something like extra, extra exceptional about it. Either asymmetric information on the founder, their ord in market and have revenues, you know, one of many heuristics. But otherwise I just try to stay superdiscipline and try to wait it out. Given that the environment is so competitive in the bay area. Price is obviously and you know, correspondingly, valuation is obviously one major lever, but there are lots of other lovers that either that the founder, in a position of strength, might pull around terms. Are you see being shifts in the terms of deals or in, you know, you're as an investor, like typical terms that you might get in a in a term sheet? Are they being changed modified? Is there any kind of evolution happening in the way that investors assume ownership structure into a company? Not Really.

What I'm seeing is like how the rounds are being raised or change, which is like the norms around having a deck and materials is changing. I don't agree with that, by the way, but it is changing. I don't think you don't agree with that because it makes people lazy or because it doesn't force them to have clear thinking. Yeah, I just think like part of the test of starting up is just be able to structure your ideas and communicate them the others, and it has to happen at some point and so I feel like it's just good hygiene to do it. I think another thing is just like people not thinking about their investors in the sense of like what would happen in the downside scenario and just going for price or more money. You see that a lot. And then the other thing is like some VC's will will put in a big check and be okay with having an observer seat on the board rather than a full board seat in order to win the deal. Those are the big changes I see. One of the thingss that we're seeing on the sort of executive operator side is a declining average tenure, so not the founders necessarily, but the sort of the layer of opera raiders that report to the founders, the VP of sales, the VP of marketing, particularly on the revenue side. On average those people at high growth companies are lasting less than eighteen months. Do you, I guess you have a point of view on why that's happening. Is that a bay area observation or just industry? Know, it's a glow industry wide. Although the bay area isn't markedly different than other regions. It's roughly the same in some of the more mature markets like New York and San Francisco, and it's even shorter in much earlier ecosystem like, for example, in Amsterdam. Now. Is this across all exact functions or just sales? It's the revenue functions, so sales and marketing particularly. Yeah, my guess is there maybe a few reasons. It's a great question. One could just be generational, as people now who are in those positions on the younger side, you know, five to thirty five. Culturally they kind of are maybe moving cities more, getting poached more as technology expands, deciding that they want to move or work in a different company. So people have more career and geographic mobility. Part of it could be just cultural. Amongst that demographic part of it could be that the churn is higher in the revenue function businesses where if you don't perform or hit quota, you know you're not really compensated in the same way and someone else may be wanting to give you the chance so you you jump ship. So that would be just my interpretation. I don't know for sure why that's happening. What I can say is within the bay area just the tenure overall has decreased as a norm and so it's really hard for people to retain the talent that they've spent millions to get and they have to work really hard to keep it because there's just really a free flow, you know, free flow of people. Do you think? I mean? These are some leading questions, so I apologize I'm essentially talking my book, but do you think the traditional compensation structures might need to evolve, you know, to the point of if everybody's going to work at a company for a year and a half? That might be a good thing, it may be a bad thing. I don't have a point of view on sort of the morality of it, but it feels like for your equity grant with a one year cliff that doesn't align to how long people on average actually stayed a company might distort the employment market in some way, but maybe not. Any reactions to that. I think for your investing seems to me Pretty Fair. You know, if you leave after two years, maybe you're half Ess it or maybe the company accelerates it for good performance. You know neval from angelist has been vocal about at least an angelists, and he thinks other companies investing should be longer in order to to find missionaries and...

...find people are in for the long haul. I just think with the cost structure in the bay area especially right now. People don't want to look in for that long. I mean I'm hearing from a lot of employees they just don't even care that much about equity. There's Wan, yeah, the money. Well, yeah, probably it's all things are related. Probably they care less about equity because they have low visibility on how to turn it into money potential. Yeah, it's sort of reminds me of that Old Simpsons episode during the docom bubble where someone told Bard Er home, I can remember, to like go get the stock options and then they went into the bathroom and pull them off the toil, the paper roll. But yeah, I mean I just I think if you ask a bunch of like twenty five year old types in the bay area for working at companies you know, do you want this equity grant or do you want the equivalent x bump and salary, I am a majority would say put the cash in my pocket. I don't even care about yeah, about the equity. So that's probably true for twenty five year olds. It's more I'm more referring to executives, you know, people in their mid S to s, and those people are moving just as often, it seems like, as the as the youngsters, the twenty five year olds. Yeah, it's possible. I mean I think in the bay area to there's a lot of poaching going on. People are raising huge sums of money and they're using capital as a weapon. And Yeah, you can say, okay, well, leave a couple million on the table here because I'm not besting, but I'll get more of that in packages coming in the new deal because I'm negotiated. And so, you know, people find ways around it. Yeah, changing topics a little bit, you know, you've had some great outcomes. When you think about the teams, the founders, like not not, you know, obviously you you you come in at a stage where essentially a lot of the work you're doing is I'm I would imagine, correctly if I'm wrong, but the size of the market and the quality of the founder and whether it to your point, whether that person is someone you want to spend time with. But as you watch the evolution of these companies over the many years that you remain on the Cap table and are an active participant in their growth, what is it that you've noticed in terms of execution, like what are the common themes when it comes to the way that these companies are able to achieve an outcome that that that differentiates them from those that aren't, because obviously all of the founders that you initially met you had some conviction around, some belief in. So what do you think, if anything, or is it just randomness that determines how these companies actually end up getting to scale? Yeah, so a few questions in there. One thing I would say is that there haven't really been outcomes per sea. I think the fun like Haystack has been fortunate to so far if invested in companies that have grown to the point where people recognize them. But there are real outcomes yet. I think, what if I look back on what has differentiated like that Group of folks who have been able to break out into like growth rounds and build these larger companies, I would say the founder attribute is like very clear, structured thinker. That would be number one and that's kind of like a personal profile. In more personal common I would make is all of these people on Saturday and Sunday are working, not because they feel like they have to work, they just wouldn't know what else to do. So, yeah, are they going out to Brunch with their friends? Yes, they have a life, yes, but their main activity is not kayaking or going to music festivals, it's working. You know, I mean I do. I would say another attribute is thinking about scale early and how they build their platforms and systems.

And so they'll just kind of say, well, we're going to open in these twenty eight geographies, so how do we do that and build at scale from day one, build the software to do that, or theyll the like, I'm thinking of a founder in a very vertical space and kind of say there's seven hundred and fifty, two thousand, fifteen hundred enterprise clients we could have for the service. What is our path to actually get to seven hundred and fifty plus of those? And just you know. Those, I would say, are the attributes. Yeah, are there specific things that you've noticed over the over the growth? I guess when you think about like companies that have stalled out, are their common pitfalls, things that either founders or employee should be should be on the lookout for red flags potentially? Yeah, it's a good question. I think asking that question from the point of view of an employee at one of those companies is super smart. If I'm an executive at one of these companies. That's going from, you know, ten million valuation the fifty to maybe hundred and fifty, the maybe four hundred right, which is not an unusual progression. And let's take another case of a company, similar company that just starts the plateau and their financing. I would go and I would want to know, as an executive in the company, why were the rounds flat or why was there a down round? You know, and sometimes entrepreneurs, because it's such a touchy thing, they won't, they won't level up with their team and tell them what's going on. Some founders end up raising capital at higher prices, just as so internally momentum, which I also don't think is healthy. But I do think it's incoming upon leaders at these companies to ask those questions right to kind of say, oh, Hey, like, you know, round came together. Can you just sit down with the team and explain to us how the round went? Where was it price? What does that mean for us? It's probably smart to do. Do you have a perspective on founders or executives or anybody selling secondary taking money off the table before, you know as a course of a large financing? That isn't really a liquidity event, but it's you know, it's just a big slug of capital that's that's infused into the company. I think I'm generally okay with it, so long as the following conditions are met. It's relatively a small amount to I think it really matters and how the founders bring it up right and the thoughtfulness they put around the request. Three, I think it's really hard to look somebody in the eye who maybe there's an issue with someone in their family or their kid, or they're about to get married and they want to buy an apartment or a home or, you know, they have, you know, educational them and their spouse. I've educational debt. I don't really think taking a half a million or a million off the table. I'd like a small percentage when they're these big rounds really matters. I think the issue is when the numbers start to get really big, you know, where you would say, what's this person's incentive to be as focused or committed? So that's kind of my point of view on yeah, when you sort of coming to last few questions, thank you so much for being on the show. When you think about you know, you've got to your point you're an observation later. Are you zooming out? Are you worried? You know, you mentioned things are crazy. Normally that has a negative connotation. Are you? Are you concerned that there's some kind of slowdown happening, some kind of bubble? Hesitate to use the word bubble because so much of the business that these companies do, that companies do these days, is generated off of customers generating revenue. But are you worried about a downturn,...

...about some kind of pullback? What are your what's your perspective on the overall environment? What I'll say is in the short period that I've been investing, the six and a half years, I have not seen an environment in the bay area like I've seen today. Now, I don't have the benefit of history and all this, but I do have the benefit of talking to leaders of major, major funds who have been extremely successful, who are not bang their chest kind of people. They're very sober, in fact, kind of paranoid people, and I ask him the question you just asked me, and what they invariably say is, Hey, I've also never seen something like this. The companies are really good, but the round sizes and the prices are just spiraling out of control. People are raising funds faster, deploying the capital faster, spending more money on recruits, you name it. Right, everything is more expensive. What they kind of say is, I've thought about Simil every issue that you just brought up and I can't see it. I can't see what stops it. Right. And so I think you can interpret that two ways. You could say, Wow, ten or twenty of the fifty smartest people in the world of venture who have managed funds over decades don't see how this stops. This is just a new normal. Or you can take the point of view that what are we all missing? Right? I tend to think that something will happen, but it will be a exogenous event, not an endogenous event, and so I don't necessarily think something will happen within tech and tech financing to to break this bull run. I think it would be something outside the tech ecosystem that causes some shock to the system that then ripples around where people then start thinking a little bit more about risk management. But right now it's in a complete upside maximization world. There's no there's no downside. Well, so let's ride this while we can. When you think about people that have inspired you? We have a little section where we like to pay it forward. Who are the people that were the writings you know that you want to point as to that you think if we want to learn more about seat invest saying more, learn a you know, just get where you come from a little bit more, who are the people that you point to? Typically? Yeah, I mean, I guess it sounds Cliche, but I think Fred Wilson and the knowledge that he shared on his blog is really like. I mean I refer to those post sometimes when I'm still working today, so it almost feels like he's mentored me through the blog. I would say Mike Maples is someone who holds a lot of wisdom about a lot of things. If you ask a lot of investors here, you know, especially newer ones, I wouldn't be surprised if seventy eight percent, if you ask them that question that you asked me, would mention Mike. I would say those two in terms of like influencing how how I work. And then on the LP side, I would say someone like Chris Duvos of just really understanding ventures an LP compared to most LP's, a real feel for it. Last question for you, because I know you think about this stuff a lot. If you had to bet, do you think trump's going to win re election? Wow, I can only answer that base on what I've seen to date, till the end of July, two thousand and two thousand and nineteen, and unfortunately, I would probably bet the dollar that he will. And the reason is, and that excited by that. The reason is is that...

...the way the Democrats have set up their primary set up the debates, set up the hurdles and the frankly lack of focus and the quibbling and fighting amongst themselves, I think just shows to me that they're not focused on the prize. And so again, this is the end of July, so a lot of things could change, but I think if they don't change relatively soon and turn the corner and focus on actual people who will actually vote and talk directly to them and camp out in their states and talk like a real person, they're screwed. And I do think the election will come down to for states, you know, maybe five. So my hope is they figure that out before January. My fear is that this is an unprecedented opponent in the sense of the norms of engagement have changed. He's already started campaigning against Democrats. Already, he'll probably live, tweet, drink during the debates, right and so all of this is just new and norm shattering. There's no one on the other side who's just saying, you know, who's making this easier? We're we're fighting about things from fifty years ago and cutting people down, and so I were today. I worry about it. I would also point to this guy named Mark Shields is on PBS news hour. He's an older political analyst. He's certainly someone who's left of center on most issues and he just, in all his years of political reporting, just can't believe right now with the Democratic Party is doing. And so that's that's sort of my prediction today, but I hope I'm wrong. What what I hope you're just we ventured into politically, I did. It is my fault, I think. I generally think you're right, but I'm also reminded that during the primaries, the Republican primaries in two thousand and sixteen, you know, there were a lot of people up there, a lot of people that I thought would be better challengers to Secretary Clinton. Then then Donald Trump and the primary process was actually very healthy in figuring out for them who was capable of winning. So I still am going to have faith in that process, but if I had to bet, I would bet that he wins re election. Yeah, and I hope. I hope you're right too, and I agree with that sentiment. I do think it's smart that, you know, in the fall they're going to tighten up who's on the debate stage and continue to tighten that. I just think they're there's a little bit of damage or going to have to pay for from the summer of having a really open field, because they've just given their ultimate opponents like more surface area to attack. Yeah, so we'll see what happens. Samuel, we are out of time. Thank you so much for being on the side, for having me, and yeah, let's see what happens. We'll do we're going to will do two no, maybe in a year and a half and then, sir, see where we Haa's right, and we're going to talk to you on Friday for Friday fundamental. So I we'll see you in a couple days, but thanks for being on the sales sacer podcast. Everybody, it's Sam's corner I thought that was a really interesting interview with Samuel Shaw. I think it's always really important to learn where and how investors view the world and what their perspectives are. I think is always interesting to sort of conceptualize who are the key players at the table as these companies are being formed and and are beginning to grow, and oftentimes it's the investors and it's the founders and and we as employees don't often have a...

...voice directly at that table. So we need to understand and empathize with where the investment community is coming from and how they think about business construction and how they think or don't think about issues that impact us personally as operators and common shareholders within the organization. So I thought it was a very interesting conversation. I hope you took away some insights just about what's happening in the bay area. I hope you took away some insights about sort of what are the qualities that you should look for when you're looking for to hire and a sense your CEO or your founder, because inevitably those qualities are going to be very similar to the ones that Samil looks for as a venture capitalist. On Friday we're going to talk about. What does it taken? What should you consider as you think about going into the world of venture capital? But you know, again the purpose of some of these interviews is both to understand some of the great investments and understand where these folks are coming from so that we can empathize, because we need to understand all of the key players that are driving the incentives that we are privy to and subject to as employees at the company. So I thought is really interesting interview. Before we go, we want to thank our sponsors, of course, right lucid chart sale solution, the leading account planning platform for modern sales organizations, and outreach, the leading sales engagement platform. If you want to reach me, it's linkedincom forward the word in and then forward Sam if Jacobs. If you want to reach Somemil, you need three introductions and you know, maybe a secret handshake or something like that, and then and then you hopefully in a great idea and hopefully you can connect with them. But for me it's pretty easy. Linkedin and and please give please give us a five stars on itunes. So please write us and and we'll talk to you. We will talk to you I will talk to you next time.

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