Jay Hoag - Keys to Successful Growth Investing - [Invest Like the Best, EP.429]
My guest today is Jay Hoag. Jay is the co-founder of Technology Crossover Ventures, known as TCV, which pioneered the growth investing category and has backed legendary companies like Netflix, Spotify, and Expedia over three decades. Jay explains how macro factors like regulation have become unexpectedly central to technology investing. He offers his contrarian take on today's market, arguing that consumer internet represents significant opportunity while most investors chase SaaS and AI deals. We discuss investing in new technology versus commercialization, TCV’s evolution from cold-calling to AI-powered sourcing of 11 million companies, and their three-person unanimous investment committee structure. Please enjoy my conversation with Jay Hoag.
For the full show notes, transcript, and links to mentioned content, check out the episode page here.
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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
(00:05:18) Market Conditions and Investment Opportunities
(00:06:57) Consumer Internet Businesses and AI
(00:09:04) Technology Commercialization Challenges
(00:11:30) Public vs. Private Market Dynamics
(00:15:32) Growth Investing and Competitive Dynamics
(00:22:34) History and Resilience of TCV
(00:26:32) Understanding the Firm's Investment Lifecycle
(00:27:06) Evolution of Sourcing Strategies
(00:28:33) The Role of Data Intelligence in Sourcing
(00:29:41) Internal Investment Process at TCV
(00:34:31) Challenges and Strategies in Long-term Investments
(00:41:15) Reflections on the Investment World
(00:43:48) Personal Insights and Final Thoughts
Netflix's Journey, Building TCV, and Investing Through Downturns (with TCV co-founder Jay Hoag)
We had the rare opportunity to interview Jay Hoag, cofounder of the first tech crossover investing firm, TCV, at TCV’s Engage Summit in Half Moon Bay earlier this fall. Jay and Rick Kimball started TCV back in 1995 and have been part of the private-to-public journeys of storied companies like Netflix (which Jay shares some great war stories about on this episode), Spotify, Zillow, Expedia, Facebook, Airbnb, Peloton and many others. Jay and TCV were kind enough to let us release the conversation as an Acquired LP episode, and we’re excited to share it with all of you. We cover the firm’s history, how companies should calibrate the magnitude of their future-looking product investments (a topic we didn’t realize would end up being so timely) and perhaps most importantly, pivotal moments where now seemingly unstoppable companies almost died amidst big macroeconomic changes. We hope you enjoy!
Links:
The Acquired Merch Store
The Acquired Slack
Sponsors:
Sierra: https://bit.ly/acquiredsierra
Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.
Jay Hoag - Calibrating Market Adoption - [Invest Like the Best, EP. 244]
My guest today is Jay Hoag, co-founder of TCV. If you look at Jay’s investment track record, it’s a “who’s who” of tech giants with Airbnb, Netflix, Peloton, Zillow, and a list that does not stop there. Needless to say, Jay has a Hall of Fame career. During our conversation, we talk about his own journey founding TCV, what advice he has for visionaries, and why he sees advantages for private to public crossover investors. Jay has such a wealth of experience that is on display throughout this episode. Please enjoy my conversation with Jay Hoag.
For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.
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This episode is brought to you by Canalyst. Canalyst is the leading destination for public company data and analysis. If you've been scrambling to keep up with the deluge of IPOs and SPACs these days, Canalyst has models on Robinhood, Marqeta, Grab, and everything in between. Learn more and try Canalyst for yourself at canalyst.com/patrick.
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This episode is brought to you by Hall Capital Partners. Hall Capital is always looking for exceptional investment talent at any stage and size, so if you are raising capital or looking for a career change in the San Francisco or New York areas, you should check them out at hallcapital.com or e-mail at invest@hallcapital.com.
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Invest Like the Best is a property of Colossus, Inc. For more episodes of Invest Like the Best, visit joincolossus.com/episodes.
Past guests include Tobi Lutke, Kevin Systrom, Mike Krieger, John Collison, Kat Cole, Marc Andreessen, Matthew Ball, Bill Gurley, Anu Hariharan, Ben Thompson, and many more.
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Follow us on Twitter: @patrick_oshag | @JoinColossus
Show Notes
[00:03:13] - [First question] - Some of his early key formative experiences that shaped his worldview as an investor
[00:06:29] - How much software businesses have changed since he started investing in them
[00:08:28] - The key insight that led him to create TCV
[00:11:36] - Generating returns by swinging less and raising your average
[00:15:06] - Understanding and evaluating a value proposition in its early stages
[00:22:08] - What slightly crazy founders look like and why it’s important for a company
[00:25:47] - Whether or not we’re in the golden age of content already
[00:28:27] - Why Peloton was rejected so many times before TCV invested in them
[00:32:32] - Things founders often need from him and how he helps them succeed
[00:36:15] - Lessons learned from investing in public markets versus private ones
[00:41:35] - Advice for founders when it comes to conveying their ideas to investors
[00:44:55] - The social dimension of interactive and network building content
[00:46:18] - How important maintaining a focus in the early days is for a new company
[00:48:07] - The most challenging aspect of executing his strategy today
[00:50:48] - One of the most emotionally stressful episodes while launching TCV
[00:53:44] - Supporting your founders during the good and tough times
[00:55:16] - New potential headwinds and tailwinds in the tech space writ large
[00:59:14] - Things people might be overlooking today that could be great opportunities later
[01:02:58] - Whether or not internet companies are threatened by the crypto boom
[01:04:32] - What most has him most excited about the world today
[01:06:20] - Advice for company building in the investing world in general
[01:09:48] - The kindest thing anyone has ever done for him