Chain Reaction: Crypto VC space may be on the cusp of recovery (w/ David Pakman)
This week on Chain Reaction, Jacquelyn interviewed David Pakman, managing partner and head of venture investments at CoinFund.
Before CoinFund, David spent 14 years at the venture capital firm Venrock. He also led the Series A and B rounds at Dollar Shave Club which was acquired by Unilever for $1 billion. And in 1991, David co-created Apple Music when he was a part of Apple’s system software product marketing group
We discussed the state of the crypto VC environment, areas he’s focusing on for investments and what he thinks investors are missing.
We also talked about:
AI compared to crypto
Future of NFTs
Regulatory impact on investors
2024 outlook
Advice for startups
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ANGEL: Venrock’s Bryan Roberts on 25 years in VC, hitting wins early, avoiding bad habits | E1665
Please take our audience survey!: https://launchevents.typeform.com/to/K5RhKaEH
Jason sits down with Bryan Roberts of Venrock for another episode of Angel Season 7! They discuss Bryan’s first bets (2:22) and his perception of the dot com bubble. (14:38) The two also dive into topics like creating optionality as a startup (21:24), bad habits in VC (28:49) and Theranos. (36:18) To wrap the show, Bryan and Jason discuss disagreeing with founders (39:07) and the psychology of placing bets! (44:33)
(0:00) Jason kicks off the show
(2:22) Bryan’s first investment: Illumina
(8:52) LinkedIn Jobs - Go to http://linkedin.com/angel and post your first job for free
(10:16) Bryan’s second investment: Athena Health
(14:38) Bryan’s experience during the dot-com bubble
(19:54) Merge - Get started by integrating up to 5 linked accounts for free today at merge.dev/twist
(21:24) Creating optionality in a startup
(25:30) Understanding your leaders
(28:49) Bad habits in venture
(34:55) Velocity Growth - Get $500 off your first growth audit or monthly package now with promo code TWIST at velocitygrowth.com/twist
(36:18) Bryan’s thoughts on Theranos
(39:07) Diligence and disagreements with founders
(44:33) The psychology of placing bets + advice for founders
FOLLOW Bryan: https://twitter.com/brobertsvc
FOLLOW Jason: https://linktr.ee/calacanis
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CoinFund’s new $300 million fund aims to capture ‘steep’ early-stage value
Web3 investment firm CoinFund recently launched a $300 million fund targeting early-stage crypto and web3 startups.
In this episode of The Scoop, CoinFund Managing Partner David Pakman shares how this fund fits into CoinFund’s broader investment thesis for crypto and web3, including why the fund is specifically targeting early-stage startups.
The new fund is intended for new crypto startups already showing signs of success. As Pakman explains,
“We saw a lot of seed-stage companies graduating to have real progress and we wanted to invest in that stage too, so we raised a fund purposefully to invest at the Series A, maybe Series B stage of crypto projects that are showing some traction.”
While CoinFund is also looking to raise an additional $250 million fund specifically for seed-stage investments, Pakman says the early-stage investments typically see the most value creation:
“A company is showing a little bit of progress, they may be showing some evidence of product market fit, and they're going to raise — not growth capital yet — but, you know, ten to fifteen million dollars… the steepest part of the value creation can happen just after that moment.”
Episode 117 of Season 4 of The Scoop was recorded live with The Block's Frank Chaparro and CoinFund Managing Partner David Pakman.
Listen below, and subscribe to The Scoop on Apple, Spotify, Google Podcasts, Stitcher or wherever you listen to podcasts. Email feedback and revision requests can be sent to podcast@theblockcrypto.com.
This episode is brought to you by our sponsors Tron, Ledn
About Tron
Founded in 2013, Huobi Global is one of the largest virtual asset exchanges in the world. Huobi Global serves millions of users across international markets. Since its establishment, Huobi Global has committed to providing first class virtual asset investment services. Huobi Global's robust infrastructure, product innovation and capital strength provides a truly customer-centric and secure trading environment to help our international users to achieve their investment objectives. Please refer to Huobi's official website for more information: huobi.com.
About Ledn
Ledn was founded on the unshakeable conviction that digital assets have the power to democratize access to the global economy. We help you to experience the real life benefits of your Bitcoin without having to sell it. Start a savings account, take out a loan, or double your Bitcoin. For more information visit Ledn.io
Crypto feels broken. That’s because it’s the internet circa 1996.
David is a CS major who worked in Apple’s music group in the 90s and went on to become CEO of eMusic in the aughts.
At Venrock, David invested in early-stage crypto, consumer, and enterprise tech companies. He was early to crypto as a node maintainer on the Bitcoin blockchain and an Ethereum miner, setting up a rig in his basement several years ago.
At CoinFund, he focuses on early- and growth-stage crypto and blockchain companies and technologies like Upshot, a platform for crowdsourced NFT appraisals, and Rarible, a digital art NFT platform.
ICYMI: Listen to our episode Web3 won’t save us.
This week’s Lifeboat badge goes to user M-M for their answer to Find the area of an n-interesting polygon.
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20VC: How Both Founders & GPs Should Construct Their Pitch, Why VCs Are Eternal Optimists & What Makes The Best Post-Investment VC/Founder Relationship with Brian Ascher, Partner @ Venrock
Brian Ascher is a Partner @ Venrock, a leading fund with prior investments including Nest, Dollar Shave Club, AppNexus and many more. At Venrock, Brian invests broadly across enterprise and consumer markets and has enjoyed no less than 10 of his investments exit successfully. Due to this exit rate,Brian has been named to the Forbes Midas List multiple times, for the VCs who have backed the most profitable winners in the last four years. Prior to Venrock, Brian was a Senior Product Manager at Intuit responsible for Quicken and Quicken.com.
In Today's Episode You Will Learn:
1.) How Brian made his way into the world of VC and came to be a partner at Venrock?
2.) Does Brian believe that in today's world of 'ask for advice and get money', that slide decks are necessary anymore?
3.) How does Brian like pitches to be structured? How should the deck start? Why should the deck not start with the team or the origin story? Should the deck include the amount being raised?
4.) What are the most common mistakes that entrepreneurs make in pitches? How can they turn these into an advantage and show the VC their unparalleled insight?
5.) How does Brian view the post-investment relationship with founders? What makes for the optimal relationship? Is it possible for VC to be both friend and board member? How does Brian look to scale the relationship curve when getting to know a founder?
Items Mentioned In Today's Show:
Brian's Fave Book: Extreme Ownership
Brian's Most Recent Investment: Socrates
As always you can follow Harry, The Twenty Minute VC and Brian on Twitter here!
Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC.
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20VC: Dollar Shave Club's Series A & B Lead Investor, David Pakman on The Requirements For A Successful Subscription Business & Why A Lot of Investors Do Not Like Consumer
David Pakman is a Partner at Venrock and the man behind Venrock's leading of the Series A and B rounds for Dollar Shave Club. Prior to Venrock David spent 12 years as an internet entrepreneur. Including being CEO of eMusic, the world's leading digital retailer of independent music, second only to iTunes. Prior to eMusic, David co-founded Myplay in 1999, which he later sold, in 2001, to Bertelsmann's ecommerce Group. If that wasn't enough David is also the co-creator of Apple Computer's Music Group.
In Today's Episode You Will Learn:
How did David make his way into the world of VC with Venrock?
David invested in Dollar Shave when subscription ecommerce funding was largely out of favour. What was it that excited Dave about Dollar Shave and why did he choose to invest?
To what extent do we see the existence of party rounds in today's funding environment?
Venrock took the rather unusual position to lead both the A and B rounds for Dollar Shave. What was the internal conversations like within Venrock towards this decision?
Dollar Shave was growing at phenomenal rates with impressive growth, what was behind the decision to sell at this time? What were the incentives behind selling to Unilever?
Will we see other large e-commerce exits in the future? What does the future M&A environment look like for consumer businesses?
Items Mentioned In Today's Show:
Matt's Fave Book: Mindset by Carole Dweck
Matt's Most Recent Investment: Pearl
As always you can follow Harry, The Twenty Minute VC and David on Twitter here!
Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC.
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20 VC 074: The Future of Healthcare with Bob Kocher, Partner @ Venrock
Bob Kocher is a Partner at Venrock and focuses on healthcare IT and services investments. He currently serves on the Boards of Aledade and Jiff, and is a Board Observer at Grand Rounds and Doctor on Demand. Prior to Venrock, Bob served in the Obama Administration as Special Assistant to the President for Healthcare and Economic Policy on the National Economic Council. In the Obama Administration, Bob was one of the shapers of the Affordable Care Act. Before the White House, Bob was a Partner at McKinsey & Company where he led McKinsey Global Institute’s healthcare economics work and Center for United States Health System Reform.
In Today's Episode You Will Learn:
1.) How Bob made his way from The White House to Venrock as a VC?
2.) How did working at The White House prepare Bob for his career as a VC, where does Bob have the biggest opportunity to change the healthcare system?
3.) What are the barriers to entry that a preventing full scale innovation and business growth in the healthcare IT space?
4.) Why have we seen a large increase in healthcare startups? What more would you Bob like to see in the healthcare space, either from the side of the startups or VC’s?
5.) How does Bob perceive the integration of software and healthcare in the future?
6.) As a healthcare professional, what would Bob recommend an individual with a high powered, demanding job in order to lead a healthy lifestyle?
Items Mentioned In Todays Episode:
Bob's Fave Book: The System
Bob's Most Recent Investment: Lyra Health
As always you can follow Harry, The Twenty Minute VC and Bob on Twitter here!
If you would like to see a more colourful side to Harry with many a mojito night, you can follow him on Instagram here!
20 VC 064: Finding Exceptional People with Big Ideas with Nick Beim, Partner @ Venrock
Nick Beim is a Partner @ Venrock where he focuses on internet, mobile, SaaS, big data and fintech investments. Nick blogs on the economics of innovation at www.nickbeim.com. Nick led the initial venture investments in a number of pioneering consumer internet companies including the Gilt Groupe, and Care.com (IPO). He also led the initial investments in a number of today’s leading big data innovators including Dataminr and Intent Media. Prior to joining Venrock, Nick was a General Partner at Matrix Partners and worked in the technology groups at McKinsey and Goldman Sachs. Nick’s primary passion outside of venture investing is international development, in particular accelerating international development through entrepreneurship. Nick serves on the board of Endeavor, a non-profit organization dedicated to supporting entrepreneurs in developing countries that Tom Friedman has called “the best anti-poverty program of all.”
In 2011, Forbes named Nick one of the “Elite 8″ to watch in Venture Capital.
In Today's Episode You Will Learn:
How Nick made his move into venture and started a bidding contest between two funds a bank for him!
How Nick got to be involved with DataMinr and how Nick believes society will use data in the future?
How does Nick standout in the super competitive rounds? What is Nick's value add?
Is it still harder for female founders to get VC funding? Why?
What can be done to improve this imbalance in the tech ecosystem?
What is impact investing? How do you balance LP returns with social impact improvements?
Our friend @ August Capital, David Hornik asks Nick, what is the difference between investing in NY compared to SF?
Items Mentioned in Today's Show:
Nick's Fave Book: Man's Search For Meaning by Viktor Frankl
Nick's Fave Newsletter or Blog: Reid Hoffman, Essays on Entrepreneurship
20 VC 055: David Pakman @ Venrock on The Future Of The Music Industry
Quote of the Day: 'A great entrepreneur has the ability to bend the world to their will'. David Pakman, 20VC
David Pakman is a Partner at Venrock, having spent the past 12 years as an internet entrepreneur. This includes David's appointment as CEO of eMusic, the world’s leading digital retailer of independent music, second only to iTunes. Prior to joining eMusic, David co-founded Myplay in 1999, which he later sold, in 2001, to Bertelsmann’s ecommerce Group. Before Myplay, he was Vice President at N2K Entertainment, which created the first digital music download service. If that wasn't enough David is also the co-creator of Apple Computer’s Music Group.
In Today's Episode You Will Learn:
How David started his career as an entrepreneur and later made the move to VC?
How David found the transition from entrepreneur and CEO to being a VC?
What is the main value add that both Venrock and David provides to their investments?
What makes a great entrepreneur for David?
How long do VCs need to know entrepreneurs before making investments?
What 3 tips would David give for best sourcing deals as a VC?
What areas does David believe are soon to be disrupted? How does David predict the next big industries to be disrupted?
What did David think of Jay Z's launch of Tidal?
Who will dominate in the music streaming sector in the coming years?
Items Mentioned in Today's Episode:
David's Fave Book: Mindset by Carole Dweck
David's Favourite Blog: Ben Thompson's: Stratechery
Dollar Shave Club: Shave Time, Shave Money
YouNow
Tidal: High Fidelity Music Streaming
As always you can follow Harry, David, The Twenty Minute VC and Venrock on Twitter here!
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