Transcription
Great to be with you again. My name is Bead Moore. I'm the chief commercial officer and a partner here at Antler. And you are joining us for the Further Faster podcast.
Today we are shooting in London and I'm here with our general partner for New York, Jeff Becka. Jeff has been instrumental in so many things in the firm uh but most importantly really defining our strategy for inception stage investing and also the agreement for rolling capital a really important instrument that we use uh with our founding companies right across the globe and I thought no, there would be no better thing than sitting down with him and talking about this and the state of venture more generally.
As a reminder, if you like this episode, please make sure to hit the subscribe button. Jeff, so good to be with you.
Thanks for having me.
Yeah, it's a real pleasure, man. Jeff's actually just gotten off the off the plane right from New York on the red eye. You've uh brave the London uh the London tube strikes and come all the way here. So, I really appreciate you making the effort.
That's it. You got to do it.
Yeah, it happened here.
You do need to do it. It's part it's it's it's what we owe our founders, right?
That's it. You got to get through the struggle to make the reward worth it.
Indeed. Um, Jeff, actually, let's start seeing as we were talking about tube strikes. Uh, let's let's start on the other tricky thing. uh a little bit about the the state of funding in venture at the moment because it's actually there's a lot of flux going on in the industry, right? You've had um this big consolidation of top funds raising more and more money. Uh, there's a lot of changes in the way that companies are being built. They are going for longer on less capital, faster growth. It's a really exciting time. Perhaps you can talk um briefly about um how it is as a founder building a company in 2025 and particularly the the challenges in raising capital.
Yeah, for sure. So, you have what the media wants you to believe and see that funding is happening all over the place. It's it's easy. The AI companies are raising at ridiculous valuations. You have to remember, you know, two three years ago is when the capital was raised and we had a 74% decline in capital raised from LPs into firms.
Wow.
We had a complete like devastation of the venture landscape in terms of those GPs that couldn't raise essentially evaporated from the ecosystem. So we have fewer GPs. We have fewer cap less capital raised into those firms. And then they're sitting here thinking, okay, when do I deploy again? Because I don't want to make the same mistakes I made in '21 and '20 where we got into a hype cycle, crazy valuations, no governance, so no board seats, no voting rights, and they're sitting on a portfolio that is in a tough position. And so now the founders are going into that market raising from people that are trying to avoid those mistakes with less capital and the line of sight to know that it will be hard to raise another fund if they screw it up again.
M.
And so I think what we're seeing is and you've seen this reported is a bifurcation of venture capital. On the one hand, you have the mega funds where taken in Andre Horwitz for example, the most active fund at seed stage and price rounds last year with 70 to 76 deals. I think Sequoia was number two with 26 deals. And they could lose that entire portfolio and it wouldn't matter.
Right.
Because these are 80 to $100 billion dollar AUM funds. The seed portfolio is not the thing that is driving their returns.
They're just averaging into these rounds. It's essentially option value, right?
It's option value later to put more money in. And, you know, if you can put a billion dollars in at a Series B or C, cross it over for 3X, the two billion you're going to make is going to, you know, dramatically outperform and and return all the losses at seed.
And so on some of the reporting, we're seeing like, oh, seed is hot. These rounds are crazy. The big firms are writing checks. Uh, but the reality is much more stark for the average founder because the rest of the firms the other bifurcation the other side of it is um GPs that are trying to make a name for themselves trying to be disciplined but also trying to compete.
And so they're being forced to come up in valuation to compete with the big firms. They're being forced to kind of do things that are outside of their, you know, model so to speak. Um, but the result for founders is that it is exceptionally hard to raise capital unless you are a very fast-growing AI company that they can justify to their LPs or potentially you're a deep tech company. You're so asymmetric in your upside, you can consume so much capital that those mega funds are actually really interested in where can I put those dollars to work over the next decade.
Um, and so if you are somewhere in the middle, not a hypergrowth AI company or not a deep tech company that can consume a lot of money, you're really struggling right now to raise.
And is that do you think it's a really interesting point? I mean, uh, you know, for founders that are trying to trying to get discovered and trying to break through, do you think that that's that almost sounds like it's an earlier valley of death in a in a funny way, right? Because I I read somewhere that uh 10 funds alone soaked up half of the funding last year and that it was the first year in a decade in which emerging managers did not outraise incumbents. Right. So there's been, as you say, this this consolidation and you're saying that that's being felt on the street by founders.
For sure. For sure. I mean, there are some founders of course like Lovable going from zero to a $2 billion valuation inside of a year. You know, we caught that one when it was GPT Engineer.
Yeah.
Before it was what everyone knows and loves today.
Yeah.
But it was unheard of prior to, you know, 2025 that a company could go to 100 million in revenue in under a year. And Whiz and others that were setting the pace for that were doing it in 18 months, two years, and even that was crazy. We're seeing that accelerate. So there are companies that are doing that and creating more leverage AI native companies that are creating leverage in every part of their business, but the vast majority, you know, are still trying to find product market fit, trying to find their first employees, trying to find their first customers.
And trying to transition this into this new era.
Yeah. Um, what is it, uh, for you, um, that defines these AI-first companies and and I I suppose the question is like, how do you know it when you see it?
Yeah, I I have a founder actually. Um, I love this guy. He comes to Antler in New York. He leaves his wife at home who's eight months pregnant to take part in residency, which I already think is insane, right? So you're like, "Wow, this guy is uh he's fully in. He's committed. He's burning the boats."
Yeah.
He doesn't go home with the check. Like his wife's leaving him or something.
Yeah. Um, and he's a technical guy, CTO of two YC companies. Then he left and started his own agency where he's helping lawn care professionals and HVAC professionals, home services folks build websites.
Yeah.
And he sold that agency for seven figures.
And as the tools and technology became available for him to create an AI-native version of that agency,
he came down to build that.
And he came in on like a on a Monday, let's say. He's there at 6:00 AM before me, which most people don't beat me in. He's there till 11, 12 at night. Most people don't stay after me. Like, I cannot escape this guy's presence in the office. On Tuesday, he's in a phone booth cold calling 100 dials a day.
Wow.
Like, I've never seen an engineer write so many lines of code and make so many cold calls. Like, there should be some metric that's like lines of code plus number of dials.
It's like a Bobbell strategy.
Yeah, exactly. And he was calling his customers and selling them and then building for them and selling and building. And so from first line of code to like 8,000 in monthly revenue in eight weeks with with Antler, we backed him. It's about a year and a half ago. He's um in year one, nine months to a million in ARR.
Wow.
In year in three months later, two million ARR.
Wow.
And now he's adding a million every 10 weeks.
And what's interesting about this guy is everything that he does because he's technical is AI-native and AI-first. And so what he's thinking about when he's building is how can I turn this into technology rather than hire people.
How can I make my team more effective? The best example of this in their sales organization um they were just cold calling, right? They're calling lawn care professionals
and roofers and HVAC folks and they built um like a RAG system that would look at weather. So when is it raining and where is it raining? And when it's raining, they have the power dialer, the SE the software call the roofers because the roofers are not on the roof when it rains. And they took that one uh part of their business and 4X the revenue in the first month they started doing that.
Wow.
And so you can imagine in the old days, the old days two years ago, right? You would pick up the phone and call all the roofers and they're out there. You don't know who's working, who's not. Today you can use different systems, different data architectures to put together really insightful ways of operating, whether that be in customer success, whether it be in sales, whether it be in how you manage finance or how you build the technology. And take it one step further, you ask how I know when I see these people. This individual has internal hackathons for how they should evolve internally.
And so this is not about how should the product get better. It's what can we do to streamline the business? What can we hack together? And now that everyone has access to these kinds of tools, whether you're an engineer or not, you can build something that can change and affect the company's ability to grow fast.
I find it really difficult that somebody like that is ever going to uh struggle to raise money. But you but there is obviously this bifurcation in this challenge. Like how do you let's just finish on the kind of capital environment. Like how how do you see that playing out founders going um out to market? um what is it what is it that they're encountering when they when they do that that is that makes this I mean we all know it's a more challenging environment 2020 2021 but like perhaps you can just uh help u paint that picture of of of what it looks like for a founder.
Sure. I think in the US market where I'm based,
Sure.
the average founder to get a seed round done will do something like 200 first meetings, 200 calls talking about their business, refining their narrative, their strategy, their pitch. If after 20 or 30 they're not getting any resonance, I tell them to pull off a little bit and go back to work. I think that it's a time suck to go fundraise if it's not working.
Um, we're also seeing a little bit of the uh, you know, you saw this in 2020 and it's like in that in HBO's Silicon Valley show, he's like, no revenue. It's easier to raise with no revenue. Once there's revenue, it's like, how much more is there? How fast is it growing? So, I think there is because of this interesting time we're in where when there is revenue, the expectation is that you are moving faster than ever before.
Well, that was that was that was something we inherited from 2021, 2022, right?
Yeah. Absolutely. And so now I think you're either very charismatic pre-revenue, sell the vision, get it done, or you are post-revenue and you are compounding 30, 40% growth every single month.
And uh anything in between that, you are um out there searching for gold, right? Because uh no one believes that if they give you money, you can extract it.
So you um like uh and I actually I I don't recall the precise time when this started to come up for you, but you you were the uh you were the inventor, let's call you the the the inventor of the agreement for rolling capital, which is an instrument that Antler uses to ensure that founders get more funding.
Um, what was it? Let's let's describe what the instrument is, but I'd love to hear you say, you know, talk about like what it was, what were the features of fundraising you noticed people encountering and then and then how you came to to putting this instrument together.
Well, I think first as an investor, you want to create products that are good for your founders and good for your LPs.
Yeah.
Not one at the exclusion of the other.
Yeah.
I think sometimes we as investors uh have incentives to do one or the other. Like I'm only going to attract the best founders, I'm going to give them the most founder-friendly terms.
In 2020 that resulted in no governance, no board seats.
Uh, if I'm going to do something that's only good for my LPs, it can be predatory to founders.
Yeah.
M.
MFN, super pro-rata, all kinds of uh, you know, liquidation preferences, things like that. And so the question is, how do you design something that is good for both? And if if we just described the agreement for rolling capital, essentially what it says is we will give a founder a certain amount of money by matching a certain percentage of whatever they raise from a professional investor over a certain time period. We're essentially saying for every dollar you raise, we're going to give you 50% more money over the first year, year and a half of the company's life.
And the reason we structure it that way is because for the founders, it acts as a catalyst. It's a chance to go out to market with a committed term sheet that your earliest investor is believing in you and following on and taking some of the risk out of the business as you go to raise. Meaning, if an angel investor or a small seed fund or a scout or somebody wants to come into your round, they know that they're not alone in that and that their dollar is going to go further than just $1. There's someone else there. And this speaks to kind of a common objection, right, that a founder might get is they're trying to put together one of these smaller rounds. And everybody's like, "Well, how much have you raised?
How much have you raised? Who's going to be your lead?
Forget all of that. Let's raise on SAFEs. My earliest investor is going to keep backing me. Your money is going to go further. You have institutional support." It's just sort of takes out some of the risk.
And as a founder, you want to just keep reducing risk at all points, right?
Um, whether it be talent risk or runway risk, doesn't matter.
Um, and so that's the structure of it. It's different in every country where we operate.
Yeah.
In the US, we match $300,000.
Based on 50% of whatever they raise for the first year.
Yeah.
And that gives them a chance to build with our initial capital, the $200,000 we invest. It allows them to time their fundraise at a time that's good for their business, not in a time that their investors tell them to go do a demo day or something, right? So they can decide which cycle they want to go raise. In the US, we suggest either right after Labor Day, they get that full season ahead of Thanksgiving, or, you know, in the beginning of the the next year, prior to the summer months. So, you get like that
end of Jan, early May kind of time frame. You get a bunch of time to go raise VCs are active. We want to give founders the option of when and we want to give them a check to go catalyze it.
The beauty of the structure of this though is as an investor, you have no exposure. You have no money in these companies' bank accounts until another professional investor says yes, we want to be a catalyst and jumps in. And so for our LPs, they have what essentially is the ability to get into the hottest companies and continue to back the best ones that are getting validation from the market without having to put that money up front.
And I think it's just a great opportunity for investors to get a great vehicle, founders to get something that helps them catalyze the round. What we saw in the US is we went from about 40% of the founders raising within six months to about 84% raising in six months. So major catalyst um and also really great for the LPs because they're growing their ownership along the way in the companies that are doing the best jobs.
And so, uh, when you first I mean, it's it really is this extraordinary thing and um, you know, anybody who's built a company, I I remember, uh, when I built my first company, it was um in Indonesia at the dawn of the internet era and it was just immensely hard to raise capital and one of the the tricky things was that there, you know, there weren't a lot of funds back then and those funds didn't necessarily go across different rounds.
And so you essentially instigating this entire new process every time you went to raise, you had to build new relationships with new uh new investors. It was incredibly it was incredibly tricky. There was nobody essentially in your corner.
And what what I I like I I mean when I heard that you guys were experimenting with this, I the first thing I was like, God, I wish I had had that at the time that I was building a company because it sounds it sounds amazing.
How did you, uh, like was this something that you tried with a couple of companies were like, hey, I've got this cool idea and then it kind of quickly morphed into no, no, we're just going to roll this out across the whole US or or how did it work?
Well, the genesis of it was actually I was listening to someone talk about why the S&P 500 is such a good investment and why Warren Buffett says basically put all your money there. Don't try to, you know, get any fancy bankers or take on any crazy fees. Just
set it and forget it, essentially. And they were describing that essentially what happens in the S&P 500 is if you owned it for the last 10, 20 years, you owned Nvidia when it was number 500 and now you own it when it's number one. You also own Tesla and Netflix and Apple and all these other companies because it's rebalancing for the fastest growing companies every year. It takes all the guesswork out of it and it allows you to catch those as they're rising. In venture, there's no structure for that. There's no private markets S&P 500. There's no way to rebalance. It's not a liquid market. But with the agreement for rolling capital, what we're essentially doing is rebalancing our funds into the companies that are making it to the next stages.
M.
And what I had learned talking to partners from storied funds that had done early stage investing, a couple things they all aligned on was one, it's impossible to tell who your winners are in the beginning. So why add the incremental risk of decision-making in the early days when everyone agrees it's really impossible to tell, right? Dylan from Figma built for five years before he went and and commercialized.
Wow.
So if you were in year one or two of that, you probably would not have followed on. You probably would have been nervous that it was never going to get anywhere. Um, and so learning from that, I wanted to take the decision-making out of the first follow-on, that first catalyst.
It's a small amount of money that has a huge impact on power law returns. So, if you add another two or three% through this $300K at scale, you're going to exit with another one, one and a half percent. Right? I mean, that is a huge difference in returns on a 50 to $100 million fund. That one $300K check on the winner is going to return the fund itself, let alone the amount of equity you start with.
So, the founders love it. That they're going to market with a lot of uh confidence and speed and and momentum. The LPs love it. We think we're we're capitalizing on on the winners that we do have.
So, one thing you said is obviously so it doubled the you said FDR. So, the fund, the fund through rate effectively doubled that uh once you once you implemented it, but one of the um one of the other kind of elements of this is that it the intention is that it also makes it faster, right? Because you're it helps to catalyze these uh these investor conversations a lot more quickly. Have you seen any evidence of of that happening?
For sure. I mean, the difference in going to market saying, "I have $300,000 signed, committed. I can show you the term sheet," versus, "I'm looking for someone to be my first, you know, backer in this next round of funding." It's a different conversation. It's a different level of confidence the founder brings to the conversation. It's a different signal to the new investor that's coming in. And so, I think that plays a massive role in it. Um,
we're, you know, we're also being much more prescriptive with how to use the agreement for rolling capital. So, if you're a first-time founder or second-time founder that you know is is out there going to raise in a different kind of market as you mentioned, you want someone who's going to share with you how people are going to market and doing it successfully. And because we're doing it at such scale and such volume, we see it so many times, we can tell people what works and what doesn't.
So, this is now uh this is one of your inventions that uh obviously has gone right across uh the Antler network. Um, another of your inventions is is this um distillation of what it is that Antler does, which is inception stage investing.
Yeah.
And, uh, I think that that was something that you you came and and started to talk about right across the firm and and it's really been adopted because it it really speaks exactly what to what Antler does want to be there right at the very beginning of a founder's journey.
Yeah. I can't take credit for it, by the way. I found.
Oh, really? It's very honest to do that in public. It's great. Well, I do own inceptioninvestor.com, so you can call me the owner, but uh no, actually, we were in an IC meeting and a founder called it his inception round.
And I just, you could see it's, you know, sometimes when you talk with people, there are words that resonate. Like one of the words I use all the time is maniac.
Yeah.
We're going to come to that. Okay, good. Uh, there are words sometimes you use them, certain vernacular have a different um resonance with people.
And I saw that word resonate across the whole IC. Everyone just sort of like had this look and then in the in deliberation, we kind of talked about it and it just became very sticky. And so then I started using it in my writing and in my speaking and you could just see like people understood it much better than like day zero investing was something that we had thrown around. Are you an accelerator? Are you an incubator? Inception is sort of this um, I think what people understand it to be is an institutional friends and family round. It is the first thing that happens. Inception is the moment of birth. This is the chance to take some capital in. Most founders sell five or 10% to friends and family anyway.
Yeah.
This is a chance to do it from an institution, borrowed credibility, a real network, a real opportunity to speed up, a real opportunity to um use all of the resources that we've developed around the globe.
Yeah. And uh and and in essence, that is where uh ARC fits into this story, right? I mean, because what you wanted to be able to do is have a conversation with somebody who is right at that inception moment and be able to say, "Hey, this isn't just a replacement for friends and family. It is a fundamentally different like positioning or a fundamentally different offer that that you've got somebody who is a long-term capital partner right from the from the earliest stage." Right.
For sure. And we talked a little bit about reducing risk. This is one of those things where if you are taking money from a firm early on, you want to know what are my chances of making it another stage.
Yeah.
Right. Am I reducing risk in my journey? And so what is your fund through rate or what is your mechanism for following on? Or how likely are you to help me meet the right investor? And so the ARC is one example. Um, it's one way we derisk and help them know that when they come in, they do have a long-term partner. They do have a follow-on check. We're also running, we run a bi-annual showcase. We don't do a demo day.
Um, I'm like I'm of the personal opinion that I don't want to sit in front of a hundred pitches one minute at a time with one slide that's the same template. What I want instead is I want to know who the companies are. Who are the founders? Most importantly, what are their backgrounds? I want to know the evolutions of the timeline. How fast are they moving? I want the metrics. I want to understand who their customers are. I want to know what they're doing and and like a general thesis. And all of those things fit into four or five bullets. And you can stick a calendar link at the bottom of it and you can send it out to every investor and let them decide what they think the good ideas are and who the best people are. And we do that twice a year in the US. We book um, we're actually running one this week. We book about a thousand meetings a week out of the gates.
And that's massively powerful for a founder to catalyze and jump start the round. It gives them confidence that there's momentum. It helps them understand that people are interested in what they're building, that they're impressed with the metrics that are on those pages. Um, and I think that as a salesperson, even like what you want to do is believe in your product and believe in yourself and to put 30 or 40 or 50 meetings on a founder's calendar and have them go to market with that as a starting point. It allows them to refine their pitch, but it also jacks their confidence up and that is one of the things that I think really um sets our founders apart when they go to market.
Okay. So, the founders are really well supported. Let's talk about what what do you think specifically are the skills that you need as an inception stage investor? Like what is it that you do? Like obviously you came into Antler and I know that you had invested in a kind of a range of things, but now you're this you're very very focused. You have a a clear mandate. What what what is that? What does that look like?
I probably should ask you because you've built a massive company. You've been a partner at Antler. You're now running all of technology and marketing. You've done an amazing job.
Thanks, man.
Um, it's a surreal experience to be asked that question by someone who should be answering it.
You're the expert. I look, you look, you you're the expert and I I I I think what I'm interested in is I I think it's a uh I think it's a set of character traits and it's a style of building.
Yeah.
Right. And I think
um you have distilled it really well, but it's it's one of these things that when you work with founders all the time, you start to get a real feel for uh this extraordinary focus on execution, right? The ability to make your make problems internal to problem solve really effectively. Uh, there's a whole a whole sequence of things, right? But I but I am keen to hear because I think that you you have articulated this well.
So, well, one of the beauties of inception stage investing, it's actually a lot less noisy. As soon as you get into acceleration or seed,
you have customers and revenue and competitors and all the reasons to do it and all the reasons not to do it.
And it's an emotional thing as an investor. I've done that game before and you call a customer and they love it, and then you call another customer and they hate it, and then you call an employee and they had a horrible experience, you call another employee and they're like, "This is a a rocket ship." And it really messes with your decision matrix. But at inception, like pre all of that stuff, when it's one or two people in a room, when there's no customers and there's no revenue, it's very clear how that person acts and operates and thinks and communicates. And so you can focus all of your underwriting, all of your
on the human being and on the person.
Yeah. Yeah. And so then you're thinking, okay, what needs to be true for the lifetime of this person's career and of this company for this to be successful? And are they an outlier in those dimensions or not? Regardless of what they're building, let's put the business over here for a second.
Yeah.
Right.
And so when we work with a founder, there's lots of things that I'm looking for. And I always before I go into this, I like to I joke that like I'm giving up my edge. Like as soon as I tell people this, they just come to me and do exactly what I tell them to do.
Um, but it's things that you know of like all the people you've worked with in your career that are the best colleagues and the most impressive people. Things like how is their style of communication? Is it concise? Is it verbose? Is it fast? Is it slow?
All of those things compound. Are they going to be a slow communicator forever?
Is that going to slow the company down, or are they going to be responding at midnight?
I'll slack a founder on a weekend. Just curious, like, hey, I had this idea for you. If it takes until Tuesday to respond to me, what are they doing? Right? I don't know any successful companies in my portfolio or outside of it where in the very beginning the founders are not on the court all the time, 100%.
Maybe they take some hours out for their family. Maybe they're off on Sundays for.
Well, it's running through their mind right all the time.
Yeah. It's always on their mind because it's like a like a heart attack constantly that like things are not good enough and like I need to get out of these hard moments and I need to move faster so that I can create leverage and I can delegate to lines of code and I can delegate to people and delegate to capital.
Um, and so communication is one. It's very clear. Are people articulate? Is there clarity? Are they concise? Are they fast? The second one, which I think is like so binary and so easy, is just are you working? You know, I did this job before being an Antler for a bit and you give someone money before you really work with them and then two weeks later they're doing nine to five, five, four or five days a week. Maybe they're moonlighting to bring a little extra money and doing some consulting projects on the side.
That I'm sorry, that person's 99.99 times out of 100 not making it.
No.
But it's very binary to say, are you working six days a week? Yes or no. Are you working seven days a week? Yes or no?
If there's customers and revenue, all that stuff, you sort of forget that that's a requirement. And because the revenue is so good and they're only working five days a week, you might you might lean in a little bit harder than you should.
And at inception, you don't have to do that. Are you working hard enough?
Um, there's some other unique things that I like to think about like narcissism.
Um, it's an interesting one because uh, people that think very highly of themselves and at the same time have imposter syndrome, so narcissism and imposter syndrome when held together in balance, I have found that it requires people to work much harder to prove themselves right.
They're overcompensating. They're overcorrecting. So they can prove that they this ego that they have is a real thing and that they're right.
And so and other people have shared this wisdom too. And so it's not mine, but I do look for that in people. And I want to know, do they believe in themselves? Because you have to as a founder. If you don't believe in yourself, I mean, the world will tell you no constantly.
And you will succumb to that.
Um, are they good at generating momentum, right? Are they breathing life into the business or does the business breathe life into them? You want the latter. You want someone who's inspired by the work, who's motivated by the work, who's waking up with energy, who can't wait to get to the office in the morning and and almost like dreads going home at night.
You know, and more founders more often than not are the ones breathing life into their business and you can tell it's a drain on them and you can see the entropy. And with my best founders, it's the opposite. Like they're so excited to get on stage and tell somebody. They're so excited to recruit somebody. They're so excited to take an introduction. And so you see all these little moments like the founder I mentioned earlier. You see if they're cold calling and writing lines of code.
You can see if they're an outlier on how hard they they go at um creating product and shipping every day or if they're sort of nervous and they don't ship for a week or two at a time. And then you think if you extrapolate that out, these are the same kinds of people they're likely going to hire because they resonate with them. And so if they hire 10 people and they're all waiting two weeks to ship, it's just slowing down. And whether it's a good business or not, by the time you get to year five, six, seven, eight, people are tired. And that early exit looks good. And that doesn't help our LPs make, you know, life-changing returns.
Yeah, totally. Um, one of the things that you've said that I think is uh is is right on the money is very concise is noise, right? Like investing in inception helps you eliminate the noise because you can really what you are looking at is the person and how they and how they operate.
Um, and from that you can extrapolate even through the noise and and make these decisions about who's going to be a great founder. One thing you haven't mentioned, but I know that you've written about is actually if you look in the other direction, these people invariably when you ask them what they were doing in their in their teenage years.
Yeah.
It's extraordinary, right? There's all all these achievements. Is that is that something that you have come across? Like we we've just we've just made a couple of investments. I've been talking about this all week about in these two 19-year-olds who both just like randomly two 19-year-olds from uh the western part of New South Wales, both country boys.
You know, came to the city, computer science degrees, both dropped out and building these amazing products. And the thing that's been really interesting about both of them is that when we asked them, hey, well, like what were you doing? And they were like, "Well, you know, I was really bored out on the farm and so like all I was doing all day was like I was coding. I was building games. I was and and and and I think that this is always true of great founders is when you go and you look backwards, you can see this long history of delivery in the same. Do you find that to be true?"
Yeah, I mean, we I personally obsess over the psychology. Like I want to know what's going on in your head.
Yeah.
You know, you can tell me whatever you want, but I want to know what's actually going on up there. Why are you going to refuse to quit? What is it about you or how you think or what you think about yourself um that will keep you from giving up? Because I think that's the difference between success and failure.
Right? That's the difference between creativity and not creative, right? Like the ability to just persist through challenge. And you know, I joke that they're maniacs, but like they are they're they're maniacs because they have this like wider spectrum of how they see everything. It's the optionality to persist through a problem, the ability to keep going when it's, you know, seems impossibly hard or when your friends and family think you're crazy.
Um, so one of the questions I love to ask in the interview is, you know, if I met your mom, what would you tell me about you? And what I found, there's a few questions I ask like that, but what I found from that question is there are narratives, narratives that you've been told and that you tell yourself that when you ask that question and you hear the answer because they're always caught off guard. So you always get like a truism of some kind and then you ask a second and third and fourth level question about those things.
You're never going to be ask that able to ask that question again. You've kind of given that you've just given that away. That's.
I've written that. People don't know. I I shout into the I'm shouting into the wind most of the time, right? Uh, by the time they figure it out, we will have already exited for zillions of dollars.
Um, no, but I do ask it and then I go second, third level question on it because like a therapist, you want to find out what who is this person? Um, most of my maybe all of my my greatest founders that I've invested in have just like the craziest stories. They were, you know, they built a product or company when they were a kid. They lost 300 pounds in high school. They whatever crazy stuff that, you know, they they've summited all these peaks, they've run these crazy marathons, they they do hard things because they they just enjoy the pain of it. They can withstand a lot.
That's not true for for everyone, but if you if you peer into it, it's like they moved to this country when they were 10, didn't know the language, their parents never learned the language, they had to be the communicators at home, they had to be adults from a young age. There's all kinds of interesting things, and it doesn't matter what that story is, and I'm not looking for that story to be replicated. What I'm looking for is like, what is the psychology behind the story? Are you someone that can withstand pain and commit to things for a long time? Do you have a high bar for excellence? Do you want to be number one in the world at anything or something specific?
Um, and if that's not true, it's just like it's unlikely you're going to be if that's not part of your psychology.
Yeah. Um, you've written a lot about this uh on your Substack uh Monday Morning Meeting. So, anybody who's listening to this and wants to review this in in in more detail can subscribe to Jeff's Substack.
Um, and what about for the people who are listening to this and and think that this might be describing them? What should they do now?
Yeah. Well, if I tell them what to do, they'll do it. And with.
Well, that's great. Yeah. But but unfortunately in our shoes as investors, you don't want to tell people what to do. You want people that are self-reliant, that are autodidacts, that teach themselves things, that are batteries included, and have all the motivation and energy.
Um, for example, in New York in our residency, I don't run startup school. I don't teach people how to build and sell and move fast. Just an expectation of the room. And if you're not living up to that, like that's not something that you brought to the table. I'm not going to all of a sudden just like teach you how to do that. If you can't go to Google and like watch a blog or listen to a podcast or find the answer or type it into chat GPT, like how are you going to build a a 10 billion, hundred billion dollar company?
Totally.
And so instead of like what would I suggest they do instead, I would tell them like reflect internally. Is this something that you even really want to do? And if you do really want to do it, have you put in what a true 150% effort would look like? Have you obsessed over your problem? Have you obsessed over your customer? Have you done as much work as you can possibly do to find out if something that you believe is true actually is?
Um, and have you executed against it? Or are you just sitting there on a whiteboard or writing up a business plan? You know, are you out there doing the thing and moving it forward? So, I always tell my founders, action creates information. You know, it's what Brian Armstrong says at Coinbase, like go out, take some actions, learn some things, move forward, create momentum, it'll compound over time. And so, it's less about what I think. It's more about, you know, what people are willing to do and the effort they're willing to put in.
Great. Well, listen. If you're too modest uh to to make this call out, I'm going to do it for you. You're in New York, so anybody who wants to work with Jeff should go and do that.
Um, hey, it's been a real pleasure. Thanks for making such an effort to come into the studio with us.
It's an honor and a pleasure to sit here with you. I feel very lucky to sit across from the mic from you.
Thanks, mate. Jeff Becker has been my guest today on the Further Faster podcast. Thanks very much for joining us. As a reminder, if you like this episode, please be sure to subscribe. Thanks for joining us and speak to you next time.