Tokenmaxxing was the hottest trend in Silicon Valley earlier this year, with CEOs encouraging employees to push AI usage as far as it would go. Then the bill came due. Uber reportedly blew through its annual AI budget in a few months, some companies cut Claude licenses for parts of their org, and Meta killed its internal leaderboard.
This tension between hype and ROI is exactly where NEA partner Tiffany Luck lives these days. She got her start convincing companies that e-commerce was the future, and now she's all in on AI, especially when it comes to the possibilities for "magic moments" in the consumer business.
On this episode of TechCrunch's Equity podcast, Luck joins Rebecca Bellan to talk about the future of personal agents, her thoughts on this year's AI IPOs, and how startups are stepping in to help enterprises track return on AI spend.
Listen to the full episode to hear:
What the tokenmaxxing-to-ROI shift means for how companies measure AI spend.
Why forward deployed engineers are becoming a "Trojan horse" for AI adoption.
How enterprises are mixing and matching models instead of committing to one provider.
Why Tiffany thinks value is being created at every layer of the AI stack, not just at the model layer.
Subscribe to Equity on YouTube, Apple Podcasts, Overcast, Spotify and all the casts. You also can follow Equity on X and Threads, at @EquityPod.
Chapters:
00:00 Intro
00:51 Tiffany Luck's path from Lot18 to Amazon to VC
3:45 Magic moments: Waymo, healthcare, and the gap in personal agents
7:36 Privacy, security, and trusting AI with your life
10:39 IPO outlook: Anthropic vs. OpenAI on public markets
13:58 Compute, infrastructure, and where the value sits
15:41 What’s the ROI on tokenmaxxing?
27:07 Forward deployed engineers as a ‘Trojan horse’
32:49 Outro
Learn more about your ad choices. Visit megaphone.fm/adchoices
Chetan Puttagunta is a General Partner at Benchmark.
We talk about investing in Manus, the AI company that went from zero to $100M ARR in eight months and was recently acquired by Meta.
We also talk through the full history of application software, from mainframes to client-server, to the internet to cloud, why each wave reduced the barrier to entry and created an explosion in the number of new software, why legacy SaaS companies are making the same mistake on-prem vendors made at the dawn of the cloud, why software companies should be making big AI acquisitions, and how public market investors are begging private AI companies to go public.
We also talk about what Benchmark actually looks for in founders, how they make decisions, and why his last two investments were consumer AI and crypto.
Thanks to Sam Ross and Everett Randle for helping brainstorm topics for this conversation.
Thanks you to Numeral and Flex for supporting this episode.
Try Numeral, the end-to-end platform for sales tax and compliance: https://www.numeral.com
Sign-up for Flex Elite with code TURNER, get $1,000: https://form.typeform.com/to/Rx9rTjFz
Timestamps:
(0:08) Inside the $2.5B Manus acquisition
(6:24) Manus' three main use cases
(11:08) Taking heat on Twitter
(15:10) Starting to tweet about software in 2018
(22:50) The history of application software
(29:15) Benchmark’s 25x Fund 7
(31:33) SaaS incumbents got too dominant by 2020
(31:48) Going all-in on AI software in 2022
(39:31) Benchmark didn’t invest in the big AI labs
(40:48) How cloud companies beat on-prem competitors
(44:33) Why AI companies will beat legacy cloud competitors
(50:04) Software incumbents should make big AI acquisitions
(57:35) Why incumbents have not bought more AI companies
(1:04:43) Public markets are starving for AI companies
(1:10:14) Inside Benchmark’s fund strategy
(1:14:14) Benchmark’s history of non-traditional VC rounds
(1:17:56) Is the 20% ownership model outdated?
(1:19:20) Chetan’s rebirth as a consumer investor
(1:22:39) What Benchmark looks for in founders
(1:25:01) AI coding and gross margins
Referenced
Benchmark: https://benchmark.com/
Eric Vishria’s podcast episode: https://www.youtube.com/watch?v=I-5IsqFgrZM
Workday S-1: https://www.sec.gov/Archives/edgar/data/1327811/000119312512375787/d385110ds1.htm
Innovator's Dilemma: https://www.amazon.com/Innovators-Dilemma-Revolutionary-Business-Essentials/dp/0060521996
Try FOMO: https://apps.apple.com/us/app/fomo-never-miss-out/id6741115427
Follow Chetan
Twitter: https://x.com/chetanp
LinkedIn: https://www.linkedin.com/in/chetanputtagunta
Follow Turner
Twitter: https://twitter.com/TurnerNovak
LinkedIn: https://www.linkedin.com/in/turnernovak
Subscribe to my newsletter to get every episode + the transcript in your inbox every week: https://www.thespl.it/
My guests today are Chetan Puttagunta and Modest Proposal. Chetan is a General Partner at venture firm Benchmark, while Modest Proposal is an anonymous guest who manages a large pool of capital in the public markets. Both are good friends and frequent guests on the show, but this is the first time they have appeared together. And the timing couldn’t be better - we might be witnessing a pivotal shift in AI development as leading labs hit scaling limits and transition from pre-training to test-time compute. Together, we explore how this change could democratize AI development while reshaping the investment landscape across both public and private markets. Please enjoy this discussion with Chetan Puttagunta and Modest Proposal.
My guests today For the full show notes, transcript, and links to mentioned content, check out the episode page here.
-----
This episode is brought to you by Ramp. Ramp’s mission is to help companies manage their spend in a way that reduces expenses and frees up time for teams to work on more valuable projects. Ramp is the fastest growing FinTech company in history and it’s backed by more of my favorite past guests (at least 16 of them!) than probably any other company I’m aware of. It’s also notable that many best-in-class businesses use Ramp—companies like Airbnb, Anduril, and Shopify, as well as investors like Sequoia Capital and Vista Equity. They use Ramp to manage their spending, automate tedious financial processes, and reinvest saved dollars and hours into growth. At Colossus and Positive Sum, we use Ramp for exactly the same reason. Go to Ramp.com/invest to sign up for free and get a $250 welcome bonus.
–
This episode is brought to you by Alphasense. AlphaSense has completely transformed the research process with cutting-edge AI technology and a vast collection of top-tier, reliable business content. Imagine completing your research five to ten times faster with search that delivers the most relevant results, helping you make high-conviction decisions with confidence. AlphaSense provides access to over 300 million premium documents, including company filings, earnings reports, press releases, and more from public and private companies. Invest Like the Best listeners can get a free trial now at Alpha-Sense.com/Invest and experience firsthand how AlphaSense and Tegas help you make smarter decisions faster.
-----
Invest Like the Best is a property of Colossus, LLC. For more episodes of Invest Like the Best, visit joincolossus.com/episodes.
Follow us on Twitter: @patrick_oshag | @JoinColossus
Editing and post-production work for this episode was provided by The Podcast Consultant (https://thepodcastconsultant.com).
Show Notes:
(00:00:00) Welcome to Invest Like the Best
(00:05:30) Introduction to LLM Scaling Challenges
(00:07:25) Synthetic Data and Test Time Compute
(00:08:53) Implications of Test Time Compute
(00:11:19) Public Tech Companies and AI Investments
(00:16:58) Small Teams and Open Source Models
(00:29:02) Strategic Positioning of Major AI Players
(00:35:49) AGI and Future Prospects
(00:46:50) AI Application Layer and Investment Opportunities
(00:54:18) The Paradigm Shift in AI Reasoning
(00:55:34) Investing in AI-Powered Solutions
(00:58:46) Economic Impacts of AI Advancements
(01:00:19) The Future of AI and Model Stability
(01:02:52) Private Market Valuations and Compute Costs
(01:05:05) Infrastructure and Utilization in AI
(01:12:50) The Role of Hyperscalers and GPUs
(01:18:02) The Evolution of AI Applications
(01:27:56) Philosophical Questions on AGI and ASI
(01:34:31) The Importance of Innovation Hubs
The SMBTech economy is very different from enterprise software, and there is massive opportunity to capture it. There are over 400M small businesses worldwide. That's more than 90% of companies and 40-50% of GDP.
In this episode, Jeff Richards and Tiffany Luck, Managing Director and Partner at GGVCapital, share what it takes to win as a SMBTech startup in today's economy.
Full video with Q&A: https://youtube.com/live/pcgXYRMX2XU
Want to join the SaaStr community? We're the 🌎largest community for B2B software.
Subscribe for weekly updates: https://www.saastr.com/subscribeform
Twitter: https://twitter.com/saastr
LinkedIn: https://www.linkedin.com/company/2724976
Quora Group: https://www.quora.com/q/cloud
Facebook: https://www.facebook.com/SaaStr/
Instagram: https://www.instagram.com/saastr/
Our North American Event: https://bit.ly/2OXeAYh
Our European Event: https://bit.ly/2OZTad8
Fundraising with a successful VC firm is a huge goal for entrepreneurs, especially in the early stages of the business. But the path to a deal isn't always as straightforward as it may seem. During an enlightening session at SaaStr Europa 2022, Zach Coelius (Managing Partner at Coelius Capital) and Tiffany Luck (Investor at GGV Capital) share the secrets and lesser-known players in the world of venture capital. As Luck says, "There are many players in the VC ecosystem, and so your entry point to fundraising might be with any one of these players."
Full video: https://youtu.be/xKb4ORuFDSc
Want to join the SaaStr community? We're the 🌎largest community for B2B software.
Subscribe for weekly updates: https://www.saastr.com/subscribeform
Twitter: https://twitter.com/saastr
LinkedIn: https://www.linkedin.com/company/2724976
Quora Group: https://www.quora.com/q/cloud
Facebook: https://www.facebook.com/SaaStr/
Instagram: https://www.instagram.com/saastr/
Our North American Event: https://bit.ly/2OXeAYh
Our European Event: https://bit.ly/2OZTad8
Today, Jason and Molly speak with Ben Narasin of Tenacity VC about raising a new venture capital fund in the down market (1:30). Then, for this week's segment of OK Boomer, Producer Rachel sits down with Natalie Barbu of Rella (1:00:33).
(0:00) Jason intros today’s show!
(1:30) Jason and Molly speak with Ben Narasin of Tenacity VC
(11:45) Masterworks - Skip the waitlist to invest in art using promo code TWIST at https://Masterworks.io/twist
(13:07) How do you make a decision to sell a percent of your position?
(26:59) Bubbles - Get your point across with unlimited screen and video recordings for free at https://usebubbles.com/twist
(29:06) Valuations, 2022
(39:39) Lemon.io - Get 15% off your first 4 weeks of developer time at https://Lemon.io/twist
(40:47) Crypto is a speculator’s game
(45:25) Are these tokens securities?
(59:19) Producer Rachel tees up this week’s OK Boomer
(1:00:33) OKB: Natalie Barbu of Rella 1:25:16 Outro + Plugs
Scott Sandell is the Managing General Partner of NEA, one of the leading firms of the last 3 decades with now close to $24Bn under management and a portfolio including Salesforce, Robinhood, Plaid, Databricks and more. As for Scott, since joining the firm in 1996 he has led investments in Salesforce.com, Tableau Software, WebEx and Workday and serves on the board of Robinhood, Cloudflare, Coursera and Divvy to name a few.
Rick Yang is a General Partner and Head of Consumer Investing @ NEA, since joining in 2007 he has led investments in the likes of Masterclass, Plaid, Robinhood and many more.
In Today's Episode with Scott Sandell and Rick Yang You Will Learn:
1.) How Rick came to meet Vlad, Robinhood Founder, for the first time? What impressed Rick most in that first meeting? How did the internal discussions proceed at NEA? Was it a unanimous decision to make the investment?
2.) The Market:
How did Rick and Scott evaluate the market at the time? Bottoms up, top down?
How did the market change and evolve both in ways they did and did not expect?
How do Rick and Scott evaluate market timing risk today when investing?
How did Rick and Scott approach outcome scenario planning with Robinhood?
3.) The Traction:
What core signals and datapoints made Rick realise Robinhood had product-market-fit?
How did Rick and NEA analyse Robinhood's early organic customer acquisition? How did the board advise on how to spend their first marketing dollars?
How does the cost structure of the business compare to Charles Swaab and eTrade? Why is Robinhood such a superior model?
4.) The Team:
How has Vlad evolved and developed as a leader over time?
How did Vlad handle the 36 hours in Feb 2021 when he had to go and raise $3BN+?
Who is the unsung hero of the Robinhood team? What have they done to deserve this?
Jeff Immelt is a Venture Partner @ NEA serving on both the technology and healthcare investing teams. Prior to entering the world of venture, Jeff served as chairman and CEO of GE for 16 years where he revamped the company's strategy, re-established market leadership and quadrupled emerging market revenue. As a result, Jeff has been named one of the "World's Best CEOs" three times by Barron's. In addition, Jeff is on the board of Sila Nanotechnologies and Twilio.
In Today's Episode with Jeff Immelt You Will Learn:
1.) How did it feel when Jeff was told he was going to be CEO at GE? How did that come about? Did he feel the weight of responsibility when it was announced?
2.) When it comes to incumbents embracing innovation, what strategies work? Why do they work? What lessons does Jeff take from his time at GE on what worked? What strategies do not work? What are the biggest mistakes large incumbents make when adopting new products or strategies? What advice does Jeff continuously tell large company CEOs who ask this question?
3.) When does Jeff believe boards can be fundamentally impactful? In what circumstances do boards actually cause harm? What are the signs of the truly great board members? What are the causes of why board members can be misaligned with their founders? How should founders approach whether to listen or not to their board?
4.) How does Jeff think about trust in teams? Does he start fully trusting and it is their to be lost or start not trusting and it is their to be gained? What people do you want around you in a crisis? What are the signals of these people? What does Jeff mean when he speaks of "crisis accelerants and crisis absorbers"?
5.) How does David think about fear in leadership? What is the one thing that leaders are allowed to be afraid of? How do the best founders approach their relationship to paranoia? How do the best communicate their fears to their team?
Scott Sandell is the Managing General Partner of NEA, one of the leading firms of the last 3 decades with now close to $24Bn under management and a portfolio including the likes of Salesforce, Robinhood, Plaid, Databricks and many more incredible companies. As for Scott, since joining the firm in 1996 he has led investments in many industry-transforming technology companies including Salesforce.com, Tableau Software, WebEx and Workday. Scott also serves on the board of rocketships including Robinhood, Cloudflare, Coursera and Divvy to name a few. As a result of this investing success, Scott is among the most frequently named venture capitalists to the Forbes Midas List.
In Today's Episode You Will Learn:
1.) How Scott made his way into the world of venture close to 3 decades ago back in 1996? How he came to be Managing General Partner of NEA today? What is entailed in the role of "Managing General Partner"?
2.) What has been the single biggest change in the venture landscape that Scott has observed since his entering in 1996? How did the boom and bust of the dot com and 2008 impact his investing mindset? Consequently, how does Scott advise founders to think about capital efficiency and business model flexibility? What concerns Scott today?
3.) Why does Scott believe "this is an incredible moment in history for the asset class of venture"? How does Scott think about the core physics of company building changing? How is it companies are able to scale and grow so much faster today? Does their speed of growth change their capital requirements?
4.) Does Scott agree with Bill Gurley, "the biggest challenge is the oversupply of capital today"? How does Scott analyse his own relationship to price and price sensitivity? What is Scott's framework for determining when to pay up vs when to remain disciplined? How does Scott feel about the rise of SPACs? How will this shake out over the coming years?
5.) How much have NEA companies raised over the last decade? Of that, how much did NEA invest? Is the answer to continuously scale AUM? How does NEA approach investment decision-making with the size of partnership it has? What does Scott mean when he says, "we vote on the process"? How do you create a partnership of trust at scale?
Item's Mentioned In Today's Episode
Scott's Favourite Book: The Old Man and the Sea
Scott's Most Recent Investment: Loanpal
As always you can follow Harry and The Twenty Minute VC on Twitter here!
Likewise, you can follow Harry on Instagram here for mojito madness and all things 20VC.
Not so long ago, G.E. was the most valuable company in the world, a conglomerate that included everything from light bulbs and jet engines to financial services and The Apprentice. Now it’s selling off body parts to survive. What does the C.E.O. who presided over the decline have to say for himself?
Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.
My guests this week are Jeremiah Lowin and Chetan Puttagunta. Jeremiah is the founder of Prefect.io, an open-source software company where my family and I are investors, and Chetan is a partner at Benchmark Capital. Both are past guests and good friends. I asked them on to help the audience understand the open source software business model. I’ve been fascinated with this model in which companies give a huge chunk of their work and value away for free to a community of developers, and then make money by building additional tools, functionality, and services on top of their free and open platform. While this may strike you as a wonky discussion on a niche software topic, I think it is valuable for everyone because the ideas can be applied to more than just code. I view much of my own activity as open-sourcing investment research and knowledge. It is also important because much of the world’s technology is built on top of open source projects. I hope you learn something new about this emerging category. Please enjoy.
This episode of Invest Like The Best is sponsored by Canalyst. Canalyst is the leading destination for public company data and analysis.
If you’re a professional equity investor and haven’t talked to Canalyst recently, you should give them a shout. Learn more and try Canalyst for yourself at canalyst.com/Patrick.
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club and new email newsletter called “Inside the Episode” at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
(2:40) – (First question) – Originator business in open source software; Redhat
(5:51) – Why open source is valuable in building a business
(7:40) – Examples of the benefits of open source projects
(10:27) – Open source business models that produce the best results
(17:04) – Defensibility of open source companies
(25:02) – Mentoring younger founders on using open-source
(30:54) – The benefits of launching open-source
(36:41) – Building a digital community
(41:31) – Lessons from Open Source that can be applied to other businesses
(50:04) – The opportunity sets available in the open source space
(53:33) – Future of open source
(56:31) – Tobi Lutke Podcast Episode
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club and new email newsletter called “Inside the Episode” at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
NEA's Ben Narasin takes questions from founders: most important content in a pitch deck, COVID's impact on dealmaking, traits he looks for in founders & more!
Join the TWiST Slack: https://launchevents.typeform.com/to/kLq5Bi
Follow Ben: https://twitter.com/bnarasin
1:13 Paul: Has the current crisis changed your investment thesis? If so, how?
2:40 Ash/Christopher: How to overcome the money raised vs revenue generated in enterprise SaaS that requires heavy product work to reach product-market fit?
4:13 Emberlynn/Srinivas: What is the most important content in a pitch deck?
7:26 Guilherme: What will the VC funding landscape look like after the crisis passes?
8:37 Mary: What is the best way to present a newly launched startup that has been severely impacted by COVID-19 to investors?
10:48 Daniel: What advice would you offer college students passionate about venture capital so that they can also become investors?
12:22 Mark: What immediate skepticism do you have when you look at early-stage startups?
15:54 Len: What factor(s) would most set an early-stage (i.e. seed funding, launch-ready, pre-revenue) company apart from others seeking similar funding?
18:15 Aneesh: My startup sells multiple SaaS products for restaurant digitization. We don’t have the bandwidth to handle sales and marketing of all products at once. What should be our strategy to prioritize?
19:49 Linards: At what level of product traction will investors start to be interested? How does it differ across verticals?
22:40 Avidan: What role (if any) will equity crowdfunding play in the venture capital ecosystem at large?
23:43 Adam: What are you seeing related to startup valuations and VC terms post-COVID?
25:18 Emin: What kind of marketplaces would you like to see in the next 5 years?
26:34 Tammy: Do you think people will need a college degree for the jobs of the future?
28:48 Ellie: Post-WeWork, how should a tech startup with profit margins on the smaller side think about building a scalable and ultimately profitable business model?
30:15 Wei: What sectors are you investing in? What are you most excited about nowadays?
31:40 Ope: What skill sets do you need to move into VC from a non-Investment Banking background?
33:09 Suruchi/Mireille: In a medium article you wrote you wrote: "winter is here, severely ....don't obsess about the downside, think about the opportunities.” What opportunities have arisen so far? What changes are permanent and what changes are temporary?
35:20 Nghia: What are some books that you recommend today?
39:30 Ben: Are there areas that are non-investable at the moment whether it be overcrowded, overpriced, or the prospects aren’t great due to COVID?
40:24 Charles: Do you have any instances where a founder's positive or negative traits/signals have influenced a deal decision? On reflection, has instinct proved a better indicator than hard numbers?
43:42 Dave: What was your biggest exit/best investment? How did you source the deal? Alternatively, could you tell your worst anti-portfolio story (most successful company you passed on)?
44:46 Barry: What are some interesting healthcare startups or spaces that you have a favorable outlook for?
45:51 Raman: What’s your take on the future of learning?
My guests today are Bill Gurley and Chetan Puttagunta, both partners at benchmark capital. We review the early stage investing world in the face of coronavirus in a very timely conversation, which is one that will remain valuable once this crisis is done. We discuss enterprise and consumer, funding and growth, and the entrepreneurial spirit in the face of a crisis. Please enjoy.
This episode is brought to by Koyfin.
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
1:44 – (First question) – Landscape for venture capital ecosystem
6:47 – The experience in 2009 and the entrepreneurs that tend to rise to the top
8:24 – The relationship between early stage companies and public investors
10:45 – How this crisis impacts enterprise businesses vs the broader corporate sector
14:46 – Advice for early stage companies in a period like this
18:23 – What Chetan was doing during the last downturn and what he learned during it
20:27 – Early stage vs late stage companies in this environment
22:57 – On the Road to Recap
23:00 – Benefits of being small in a period like this
25:22 – How portfolio companies are responding and pivoting during this period
29:33 – Best practices for remote companies
31:39 – Themes that stand out during this period
34:51 – Closing thoughts
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub
Follow Patrick on Twitter at @patrick_oshag
My guest this week is a good friend and a business mentor of mine. Chetan Puttagunta is a general partner at Benchmark Capital and has a remarkable track record of investing in early-stage software businesses, including several like Mulesoft, MongoDB, and Elastic that went on to be public companies.
Chetan has been my key guide for understanding the world of enterprise software as we at O’Shaughnessy Asset Management have built an investing platform called Canvas. His advice has been critical to our early success. In this episode, we explore the history of software and software investing, and go into the details on how to build and grow new software businesses. We discuss product, sales and marketing, recruiting, scaling, and everything in between.
Please enjoy this great conversation with one of my favorite business and investing thinkers.
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
1:34 – (First Question) – How Chetan found MongoDB and decided to invest in it
8:01 – The evolution of databases in the growth of technology
16:19 – Market penetration of this space and what investors should be thinking about
21:46 – Advice how companies can build software effectively
25:12 – Tactics to effectively implement empathy led product building
30:33 – Companies asking users what to build vs telling users what they want
34:26 – The need for the right capital, and patient capital in particular
37:55 – Creating the perfect customer experience
44:37 – Common reasons they don’t invest in a company
48:48 – Lessons on scaling, especially in sales and marketing
52:47 – Best recruiting pipeline strategies
59:56 – Pitfalls of unit economic traps
1:00:23 – The Dangerous Seduction of the Lifetime Value (LTV) Formula
1:01:34– The Hierarchy of Engagement
1:02:18 – What has changed for Chetan in his time working with the team at Benchmark
1:06:009 – Later stage life cycle business considerations and Amazon’s AWS
1:13:29 – The business model of open-source software
1:15:54 – Being default open
1:17:53 – Kindest thing anyone has done for Chetan
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub
Follow Patrick on Twitter at @patrick_oshag
Let's face it, Acquired borders on Star Wars fan podcast anyway. So we dipped our toe in the water of making it official, with our review of Star Wars: The Rise of Skywalker.
We are joined by fellow Star Wars nerd and repeat special guest, Chetan Puttagunta, General Partner at Benchmark. In this episode, we *nearly* avoid any business analysis or speculation on the technology, media, or enterprise ecosystems, with only a brief revisit to the question: "Was it worth it for Disney to buy Lucasfilm?"
Did we love it, hate it, or want to bury it like the prequels? Tune in! There are definitely spoilers, so be warned!
Sponsors:
Sierra: https://bit.ly/acquiredsierra
We are joined by Chetan Puttagunta, General Partner on Benchmark, talking his investment philosophies, enterprise technology trends, and the uniqueness of Benchmark. How is this firm with only five partners and no associates so repeatably successful? Chetan shares the story of his very first investment, MongoDB, and lessons learned from his other investments and board positions in Elastic, Sketch, Duffel, Mulesoft, and many others.
Chetan also helps us understand how he balances staying open-minded enough to let founders shape his vision of the future (and not the other way around), while staying educated on areas where he thinks the future is bright.
“The product/market fit question, I don’t find to be a conclusive one…because one of the assumptions is that you’re assuming the market itself is constant, which we all know is not true. Today’s product/market fit might be tomorrow’s outdated solution.” – Chetan Puttagunta, @chetanp
Sponsors:
Sierra: https://bit.ly/acquiredsierra
Be sure to follow the Acquired Podcast:
Acquired.fm
@AcquiredFM
Chetan Puttagunta is a General Partner @ Benchmark, one of the most successful funds of the last decade with a portfolio including the likes of Uber, Twitter, Dropbox, WeWork, Snapchat, StitchFix, eBay and many many more. As for Chetan, at Benchmark he has led deals in the likes of Duffel, Sketch and Pachyderm. Before Benchmark, Chetan was a General Partner @ NEA where he led investments in Elastic, MongoDB and Mulesoft to name a few.
In Today's Episode You Will Learn:
1.) How Chetan made his way into the wonderful world of venture, came to invest in Mulesoft and Elastic and how that led to becoming a GP with Benchmark today?
2.) How does Chetan feel about the push to run businesses based on metrics and benchmarks relative to other companies? What are the metrics they should hone in on? What are the metrics they should disregard? How does Chetan advise his portfolio on the right way to view competition? What is core to analysing competition effectively?
3.) How does Chetan assess the "war for talent" in terms of startup recruiting today? How do the very best CEOs recruit the best talent to their team? Who has done this best from Chetan's portfolio that comes to mind? How much weight does Chetan place on references? What should one watch out for with references?
4.) With the rise of remote, does Chetan believe that a startup even has to have an office in SF today? How does Chetan think about the "tribal knowledge" that remains within the valley? What does Chetan advise his companies that are not in the valley and contemplating it? What works? What does not?
5.) How does Chetan think about market size today when considering new opportunities? Where does Chetan think most managers go wrong when assessing TAM? How does Chetan think about time allocation across the portfolio? What have been his biggest lessons on managing his time effectively as an investor and board member?
Items Mentioned In Today's Show:
Chetan's Fave Book: Shoe Dog: A Memoir by the Creator of NIKE
Chetan's Most Recent Investment: Duffel
As always you can follow Harry, The Twenty Minute VC and Chetan on Twitter here!
Likewise, you can follow Harry on Instagram here for mojito madness and all things 20VC.
Dayna Grayson is a Partner @ NEA, one of the leading venture firms over the last 4 decades with a portfolio including the likes of Opendoor, Jet.com, Uber, WorkDay, Plaid, Box and many more incredible companies. As for Dayna, she has led the firm's investments in the likes of Desktop Metal, Formlabs, Onshape, Glamsquad, Framebridge and Curalate, just to name a few. Prior to joining NEA, Dayna was an investor at North Bridge Venture Partners where she championed companies including Camiant (acquired by Tekelec) and Tapjoy. Before venture Dayna was an engineer at Eye Response Technologies, later acquired by Dynavox Mayer-Johnson and also a product designer at Blackbaud (BLKB), the leading global provider of software to nonprofit organizations.
In Today's Episode You Will Learn:
1.) How Dayna made her way into the world of venture and came to be a Partner at NEA from her roots in product design and engineering?
2.) Sourcing: How does Dayna approach the sourcing component of venture today? What does the deck filtering process look like to Dayna, prior to meeting? What has Dayna found works best in really building rapport in the first meetings? What does the conviction building process look like for Dayna from there? If negative, how has Dayna found is the most effective way to say no?
3.) Decision-Making: How does Dayna think about optimising the investment decision-making process? How does Dayna balance between data vs gut? Does NEA require unanimous decision-making? Why does Dayna believe that at A or earlier, the price really does not matter? When does price really become a big issue?
4.) Evolution of Expectations: How does Dayna believe entrepreneurial expectations of VC has changed over the last decade. Where does Dayna believe investors can really provide the most value? Which board member has been the most impressive to Dayna when sitting alongside them on the board? Why?
Items Mentioned In Today's Show:
Dayna's Fave Book: Dopesick: Dealers, Doctors and the Drug Company that Addicted America
Dayna's Most Recent Investment: WhireWheel
As always you can follow Harry, The Twenty Minute VC and Dayna on Twitter here!
Likewise, you can follow Harry on Instagram here for mojito madness and all things 20VC.
In Today's Episode We Discuss:
David Skok: General Partner @ Matrix Partners: Why does David believe that all good products have at least one variable pricing axis? How can founders determine which variable they should choose for their product? What are the pros and cons?
Chetan Puttagunta: General Partner @ Benchmark: Why does Chetan believe we have seen a strong decline in the per seat pricing model? What are the major drawbacks of it? What are we seeing replace it? What has Chetan seen work well amongst his portfolio?
Mark Suster: General Partner @ Upfront Ventures: What were Mark's two biggest lessons on pricing from seeing the hyper-growth of Salesforce first hand? WHat does Mark advise founders when it comes to price anchoring and discounting? How does Mark view the sale of professional services with this in mind?
Amanda Kleha: Chief Customer Officer @ Figma: What were Amanda's biggest learnings from running the Zendesk pricing playbook? What does Amanda mean when she says that successful pricing is broke up into 3 separate product features?
Brad Birnbaum: Founder & CEO @ Kustomer:Why does Brad push back on the common suggestion of a "no man's land in SaaS pricing"? Why is innovation in pricing actually detrimental to sales in most cases?
Guy Podjarney, Founder & CEO @ Snyk: How does Guy think about having a large enough base to test pricing strategies? How does Guy think about the balance between freemium and paid? Does one have to come first?
Read the full transcript on our blog.
If you would like to find out more about the show and the guests presented, you can follow us on Twitter here:
Jason Lemkin
Harry Stebbings
SaaStr
Chetan Puttagunta is a General Partner @ NEA, one of the world's largest venture capital firms in the world with over $3Bn in their latest fund and a portfolio including the likes of Mulesoft, Jet.com, Uber, Houzz and many more incredible companies. As for Chetan, Chetan focuses on enterprise software and has made investments in MuleSoft, MongoDB, Elastic, Heap, just to name a few. Due to his phenomenal track record, Chetan has been named to GrowthCap's Top 40 under 40 Growth Investors, Forbes 30 under 30 All-Star Alumni List, and Forbes' 30 under 30 in Venture Capital.
In Today's Episode You Will Learn:
How Chetan made his from the world of leveraged buyouts to the world of enterprise VC investing with NEA?
Why does Chetan have such conviction with regards to open source companies today? Why does he feel the big question of "Can open source product multi-billion dollar companies" has been proven"?
How does Chetan think about the underlying business models of open source when comparing the likes of Red Hat with 85% gross margin to Hortonworks at negative gross margins? What does Chetan believe is a healthy ratio between professional services vs closed premium features? Does Chetan believe this is the end for per seat pricing in SaaS?
How does Chetan approach market sizing today when evaluating potential enterprise opportunities? Why does Chetan believe there is a mental trap in the VC requirement for large markets? How can founders present the niche market they are attacking, in an exciting enough way to satiate the investor appetite for large market?
Chatan has said before, "if you have conviction and vision, you should not be afraid to raise capital and go big". Does every founder not have conviction and vision in the early days? How does Chetan determine when truly is the right time to pour fuel on the fire and raise that mega war chest?
60 Second SaaStr?
A moment in Chetan's life that has changed the way he thinks about the world?
Fave SaaS reading material?
What does Chetan know now that he wishes he had known at the beginning?
Read the full transcript on our blog.
If you would like to find out more about the show and the guests presented, you can follow us on Twitter here:
Jason Lemkin
Harry Stebbings
SaaStr
Chetan Puttagunta
