Adam Fisher: Why Small Markets are Better Than Big Markets | E1106

1. 0:00 – 0:54

   Intro

   1. AFAdam Fisher0:00

      I don't think that the way you build a big company or the way you get a big exit is by investing in the most ambitious companies growing the fastest. Those are also the companies that crash and burn.

   2. NANarrator0:09

      This is Adam Fisher, partner at Bessemer Venture Partners. He is one of the most prolific early-stage investors in Israel, with some of the most successful company exits, including Wix, Fiverr, and Habana.

   3. AFAdam Fisher0:20

      I see my role as a VC as picking up an entrepreneur when they're, like, on the ground, but also pulling them down when their head's in the clouds. The entrepreneurs that come to me, they realize that I have that balance and react to entrepreneurs, whether it's good news or bad news, with some kind of composure. They become more transparent with you.

   4. HSHarry Stebbings0:37

      What's the best investment advice you've received?

   5. AFAdam Fisher0:39

      There are two pieces of advice which are contrary. The first is...

   6. HSHarry Stebbings0:45

      Adam, I am so excited for this. I stalked the shit out of you beforehand. I spoke to Byron, Amit, Daniel, the list goes on. But thank you so much for joining me.

   7. AFAdam Fisher0:53

      Thank you. It's a pleasure

2. 0:54 – 2:57

   Journey into the World of VC

   1. AFAdam Fisher0:54

      to be here.

   2. HSHarry Stebbings0:55

      Now, I would love to start with your entry into venture. We had a little chat about it before. Tell me, Adam, how did you make your way into the world of venture and come to be at Bessemer today?

   3. AFAdam Fisher1:04

      So it was serendipitous. I was a student, uh, at the time I was an undergrad at, uh, Georgetown University, and I did a one-year program at the Hebrew University of Jerusalem. And, uh, in my first days, I was looking for an internship. That's just what we did at Georgetown. Every single semester, I had an internship somewhere. These are unpaid types of roles where you learn. And, uh, somebody pulled out, they went through this, like, uh, box full of, of, like, letters or faxes, and they said, uh, "Well, here's one." Now, I told them I was interested in business. And, uh, it was for a venture capital fund. Now, it's serendipitous because literally a month before, I had read an article about venture capital in Israel in a now defunct Israel American business magazine called Link at the time, and I just leapt at that opportunity. I said yes. Uh, now nobody knew what venture capital was at the time. Certainly not in Israel, but also not in the United States, not in, not to college students. And for years, I would tell people what this was and what I did, and they were kind of, you know, loo- didn't look at me with a strange face.

   4. HSHarry Stebbings2:10

      And this was 1996?

   5. AFAdam Fisher2:10

      This is 1996, um, and so that's how I got started as an intern. This was a tiny fund. All funds in Israel at the time were tiny. We're talking $15 to $20 million funds. Uh, there was one partner, one secretary, and one internet connection. And I had to ask the secretary to get off her computer so I could, uh, search the, the, the internet. Um, this is pre-Google, o-obviously. Uh, business plans would come in the mail in a big fat manila envelope. And I like to say that those business plans actually taught me more than my undergrad, undergrad degree did because they, they really spent a lot of time explaining everything. And these were very technologically oriented, uh, companies. So that's how I got started, uh, very young, I'll admit, very early. Um...

3. 2:57 – 4:55

   Evolution of VC Industry

   1. AFAdam Fisher2:57

   2. HSHarry Stebbings2:57

      Can I ask, when I listen to you there, I think of actually Doug Leone's statement that we've moved from a boutique high margin business to a, uh, commoditized low margin industry. Uh, when you think and compare the two different times, which do you prefer operating in as an investor?

   3. AFAdam Fisher3:16

      Well, I, I prefer now.

   4. HSHarry Stebbings3:18

      You do?

   5. AFAdam Fisher3:18

      Uh, just because of the experience I have. Back then, there were, there weren't many people you could actually learn from. Um, and even if they existed, they didn't write down their thoughts, you couldn't access them. It was a very closed industry. It was not only local, it was very closed. Nobody shared, uh, their investment strategies online the way we do now. Uh, nobody even ex- uh, exchanged their war stories or what went right and what went wrong. So it's a much more open industry, um, and I think it's not just that other investors benefit from that, uh, and new investors, I think entrepreneurs do as well. And so that, that, that openness now that you have with entrepreneurs, uh, is refreshing. I worked back then at a time where it was much more adversarial relationship with entrepreneurs. The, the, the VCs kind of acted as if they knew what they were doing, that they knew the right way. A lot of these VCs were former, uh, maybe entrepreneurs themselves or at least executives in, in larger corporations. And, uh, the relationship was one of very, very paternal, uh, if, if I might say.

   6. HSHarry Stebbings4:21

      In a good way or a bad way?

   7. AFAdam Fisher4:22

      No, in a horrible way. I, I, I hated it. Um, also being a very young and inexperienced venture capitalist at the time, I, I didn't like it. I didn't like seeing that. Um, and one of the things that I eventually, uh, did myself when I started at Bessemer, uh, this is in 2007, was to take a very different approach, to take this kind of partnership type of approach with the entrepreneur, 'cause I realized what they really need is not somebody to tell them how to do it, but a partner that they can confide in, that they can tell them what good happened today, what bad happened

4. 4:55 – 7:06

   Speed and Decision-Making in VC

   1. AFAdam Fisher4:55

      today without hesitating.

   2. HSHarry Stebbings4:56

      Do you think we've swung... You're like, "We, we have this schedule, Harry, why do you go off it so soon?" Do you think we've swung to a time of too much founder NPS? We often actually see that investors don't perform their duties in a, a rigorous way like they maybe would have done and they're too focused on having a great NPS. Do you find we've swung too far the other way?

   3. AFAdam Fisher5:15

      I don't think it's NPS. I think it's the speed. There's something about the speed that is not, that is not fair. It's literally speed dating. It's speed dating where the outcome is actually a marriage proposal because that's what founders are doing when they're choosing, uh, their VC and partner. They're essentially adding another founder of sorts. Now, of course, they don't get common shares, they don't get that, that rights, but there's a higher likelihood that that partner from that VC will be on your board than your co-founder will. Just statistically. And yet you want to make a decision as an entrepreneur within two meetings, within seven days? That to me is, is horrible. And as obviously from an investor standpoint, having been on the board of companies for 10 plus years, I realize that I also don't like that. My worst decisions have been the ones that I made, uh, in the, with, in the least amount of time due to pressure.

   4. HSHarry Stebbings6:05

      So do you do those deals? I mean, I'm looking at a deal now and like honestly, it's a very competitive deal, I'm meeting for the second time tonight, I'll probably have a third meeting on Wednesday, Thursday, and then I've got to make a decision.Do you do those deals?

   5. AFAdam Fisher6:19

      I, I don't, but I think when it's a smaller check, when you're amongst other VCs that may... that, that could take your place if you bow out, um, I think there's a place, there's a place for that. I'm talking about the types of, of deals where I'm the... it's a... I'm the only VC in the round, I'm leading it. Uh, if I move forward, it's me. I assume all the burden going forward. I can't withdraw at any point or if I do withdraw, it's the end of the company. Those are, those are, uh, uh, you know, real decisions, fateful decisions. And, uh, to force that to happen in such a short amount of time is crazy. I mean, I remember a time when it was three months to diligence a company and get to know one another, and I actually enjoyed that process. But when it's so concentrated in time, you're gonna make a lot

5. 7:06 – 8:49

   Second-Time Entrepreneurs' Key Insights

   1. AFAdam Fisher7:06

      of mistakes.

   2. HSHarry Stebbings7:06

      I, I always think about even pre-seed or seed, uh, the best thing is when you know the founder so well that you actually don't care what they're doing. I call them the blank check founders. We were like, "You know what? I, I've known Adam for five years. I've seen him across these different situations. I've seen him execute in these different environments. I don't care what he's doing. Real estate, healthcare, I just buy him some for pre-seed."

   3. AFAdam Fisher7:27

      Yeah, maybe.

   4. HSHarry Stebbings7:28

      (laughs)

   5. AFAdam Fisher7:28

      I, I've, I have a different view on that. I, I've had the-

   6. HSHarry Stebbings7:32

      Hit me.

   7. AFAdam Fisher7:32

      ... privilege (laughs) of having backed many second-time entrepreneurs.

   8. HSHarry Stebbings7:35

      Yeah.

   9. AFAdam Fisher7:36

      And I challenge them because I think there are sec- second-time entrepreneurs who sometimes, uh, uh, they're s- they're somewhat blinded by their previous success and they think they can do anything, and they wanna build something bigger, typically. Nobody wants to build something the same size-

   10. HSHarry Stebbings7:52

       (laughs)

   11. AFAdam Fisher7:52

       ... even let alone smaller. And their idea about building something bigger is being more ambitious, raising more money, a higher valuation, um, but that's actually not the way-

   12. HSHarry Stebbings8:02

       Do you, do you-

   13. AFAdam Fisher8:02

       ... in which you build something bigger.

   14. HSHarry Stebbings8:04

       Do you find that though or do you find that actually they're a lot more rational going, "Gosh, I'm aware that if I raise too high a valuation, it'll cap me on my next round. It'll put a lot of pressure on. The options will be higher."? They're much more intelligent about the price they raise at.

   15. AFAdam Fisher8:15

       So that's, that's the other style of second-time entrepreneur, and, and those types are also the ones that want to hear feedback.

   16. HSHarry Stebbings8:21

       Hm.

   17. AFAdam Fisher8:21

       They actually wanna brainstorm with me. They wanna share their idea and they wanna hear pushback or they wanna hear confirmation. Uh, but if they're so certain about the idea at such an early stage, to me, that's a bad signal.

   18. HSHarry Stebbings8:34

       Adam, I am loving this. So I always get pushback from the team here because I don't love first-time founders because I, I look at myself, I look at many that I've worked with. There's so many mistakes that you make as a first-time founder that if you had your time again, of course you wouldn't have made those mistakes, but you waste months

6. 8:49 – 10:19

   First vs. Second Time Founders

   1. HSHarry Stebbings8:49

      and months doing them. I find second-time founders do not make those very foundational mistakes. Do you agree with me in terms of my kind of fear of the first-time founder because of those very obvious mistakes that they make commonly and lean towards second-time founders and how do you think about that? And advise me.

   2. AFAdam Fisher9:06

      Like I said before, there are, there are two types of second-time entrepreneurs. There, there are those that don't recognize the luck that was involved. They think that, uh, building something big is just more ambition. Um, and I, I steer clear of those. Um, and then there's those that are much more rational that, uh... a- and those I will back again. But do I prefer them over first-time? Not, not really. I actually love first-time entrepreneurs. The, the, the key for looking at first-time entrepreneurs is, is, is identifying somebody that you have chemistry with, uh, that you have back and forth from, that they can learn from you, you're learning from them. It's also people who, uh, progress very fast on the learning curve. Meeting from meeting to meeting, you can witness what they've discovered, what they've learned, other people that they've discussed it with. That is generally, um, an indication of what the next several years are going to look like. Uh, and the fact that they haven't created a company before doesn't mean they can't learn from other people's experiences and from your own experience. And so for me, that's fantastic. Uh, I, I, I often look at my portfolio and I... again, I have a lot of second-time entrepreneurs, but I often say, "You know, I need, I need more first-timers. I, I shouldn't have such a bias, uh, to

7. 10:19 – 11:09

   Insider vs. Outsider Market Entry

   1. AFAdam Fisher10:19

      second-timers."

   2. HSHarry Stebbings10:19

      In ti- in terms of those first-timers or second-timers, you know, there's two ways you can approach a market or a company. One as an insider, I've lived that problem, I know it to a T, and I'm gonna build to solve it. Or another way, you almost have the benefits of naivety and you solve it as an outsider. Do you have a preference on which approach is taken and what are your lessons from what's worked and what hasn't on which one is more effective?

   3. AFAdam Fisher10:45

      I like the outsider approach. Uh-

   4. HSHarry Stebbings10:47

      Do you?

   5. AFAdam Fisher10:47

      ... it's, it's common to Israel because Israelis typically are coming from outside, not only physically, from a, from a market perspective and industry. Um, it's just also the attitude. They, Israelis think they can do anything. (laughs)

   6. HSHarry Stebbings11:00

      (laughs)

   7. AFAdam Fisher11:00

      Uh, but, uh, the, uh, I, I find they just bring a lot more innovation and openness. Of course, again, they have to figure out what they don't know and they have to recognize

8. 11:09 – 13:56

   Innovation or Existing Markets

   1. AFAdam Fisher11:09

      there's a lot they don't know. So as long as there's that self-awareness of, "I don't know anything and I need to figure it out," they can be the best 'cause they can innovate in ways that insiders can't. Insiders are just blinded by convention, by knowing a little bit too much of what hasn't worked in the past, uh, of where others failed. Naivety is a strength in these cases. And if you have the right entrepreneur who, again, is self-aware and perhaps also has a certain degree of charisma, meaning to, to kind of sell a vision, uh, both to his employees and investors and eventually to customers, it's incredible.

   2. HSHarry Stebbings11:47

      Okay, so if we have that as, like, a foundational, we like outsiders who are innovating in markets with some elements of naivety, then there's the question of, like, category creation versus working in an existing market. How do you think about that trade-off? Often we see the biggest wins in category creation, but it's also fucking hard. (laughs) It's expensive. Which do you prefer in that lens?

   3. AFAdam Fisher12:09

      I think if you're... from the get-go, if you're talking about creating a category, you're making a mistake.

   4. HSHarry Stebbings12:15

      Huh.

   5. AFAdam Fisher12:15

      I think a lot of times when we talk about category creation, it's in retrospect that we see that a category was created. It wasn't started that way. It became an independent category, and it's typically not because that one company created it bec- but because there were multiple companies with very similar mindset.And sometimes that also includes, uh, some of the incumbents who are also moving in that same direction. And luckily, you were ahead of the curve. Uh, but if I was to start m- make an investment that is trying to create a category o- out of nothing, uh, it's challenging. I think where category creation makes sense is when they've identified a new type of customer or a new type of buyer, perhaps it's a new vertical, industry. You know, i- if you decided all of a sudden that e-commerce was a new vertical segment that I wanted to sell into, meaning e-commerce shops, that would be an insight. It's not so much a category creation. The category is being created. Eh, you're now creating a product for that category. Or if you were to decide that I'm going to sell into the developers within organizations from the bottoms up, they exist. You're not creating that category, but you're essentially identifying a need and a new buyer with a product. That makes sense. Again, in retrospect, you'll say they created a category of, of developer SaaS. It's not exactly true.

   6. HSHarry Stebbings13:33

      Uh, uh, Mike Maples at Floodgate, an investor in the US, always asks, "What do you see that no one else agrees with?" And then you have this kind of insight development process that takes place post that, which I find really interesting as a question to ask. I, I guess, kind of when we think back to that, you said there about, you know, um, many people can create, create a category in retrospect, but many people going after it kind of ushers a movement

9. 13:56 – 16:48

   Contrarian Insights in Development

   1. HSHarry Stebbings13:56

      forwards. I don't like to be in companies where it's what I call like N of one where it's like there's six different SaaS pricing players and you're one of many, you know, Accel-funded one, Sequoia-funded one, Bessemer-funded one. It's kind of like race. I like companies where really it's, it's kind of just them doing it.

   2. AFAdam Fisher14:16

      Mm-hmm.

   3. HSHarry Stebbings14:17

      Do you, do you agree with me?

   4. AFAdam Fisher14:18

      Totally.

   5. HSHarry Stebbings14:18

      Yeah.

   6. AFAdam Fisher14:19

      I think there's two types of investors out there. There are those that get comfortable when there are, when there's competition, and they get comfortable because that gives them a sense that there's, that there's investors out there willing to put money in it, uh, and that, uh, there must be a market if multiple people see the same opportunity. Uh, but I'm the other type.

   7. HSHarry Stebbings14:38

      (laughs)

   8. AFAdam Fisher14:38

      I say, "Oh, no, there's already competition and there's not even a market." Uh, and, uh, and that competition can attract the better talent or they can raise more money, or maybe they'll get acquired, uh, by the only ac- potential acquirer. I have... I get comfortable when I think, "Well, it's only us, but if we're right, we're gonna be the leader."

   9. HSHarry Stebbings14:57

      Did you always have that? Because that takes confidence and conviction in yourself, and when you're young, you question yourself. I know I do.

   10. AFAdam Fisher15:06

       Well, I have to think back.

   11. HSHarry Stebbings15:07

       (laughs)

   12. AFAdam Fisher15:07

       That's many years to think back. Uh, the pace of investing was so different back then. It was one investment every 18 months.

   13. HSHarry Stebbings15:15

       (laughs)

   14. AFAdam Fisher15:17

       Uh... Uh, I did a little bit of both, including investing in, um, in companies where there was lots of competition and deciding that despite the competition, this was the one. Um, only have really one case that I'm thinking about right now is a chip company, um, uh, called Dune Networks that made a switch fabric chip. This is back in the year 2000, really dating myself.

   15. HSHarry Stebbings15:42

       (laughs)

   16. AFAdam Fisher15:43

       But they made a very compelling argument while all the competition belong- belonged to a different era and a different architecture, and how they all had the same fundamental problem, and how they were gonna succeed, and they convinced me. And I remember when I wrote the investment recommendation, uh, I had to list 20 different competitors at the time. This is in the late '90s, fabless chip companies were funded, you know, left and right. They were acquired and they even went public with design wins, not even revenues. Uh, so the idea that most of them would fail never really crossed my mind. I just thought this one would, would succeed. In retrospect, they all failed except for this one.

   17. HSHarry Stebbings16:22

       (laughs)

   18. AFAdam Fisher16:22

       Um, no, no, that doesn't mean (laughs) I can be right in the next one, but I think over time, I realized that, um, that it's, it's a better arbitrage opportunity, uh, to be the lone player or, or, or the first mover in a s- even in a smaller market, even in a niche market, than to be the number two or three in a large market. Because a number two, it's like a gladiator competition. Number two is still a loser most of the

10. 16:48 – 21:10

    Managing Follow-On Funding as a Contrarian Investor

    1. AFAdam Fisher16:48

       time.

    2. HSHarry Stebbings16:49

       I, I, I totally agree with you. Have you ever got in trouble, though, for having that contrarian approach? In terms of follow-on funding, you see the world in a way that venture investors maybe don't, and you do a non-competitive deal that's outside. That probably is not gonna have the same magneticism for follow-on investors, and you might have to carry the bag for a lot longer. Have you had that?

    3. AFAdam Fisher17:09

       Of course, and I think about that when I invest.

    4. HSHarry Stebbings17:12

       Yeah.

    5. AFAdam Fisher17:12

       As much as I am willing to be contrarian, I'm not willing to invest in something that others are not going to fund.

    6. HSHarry Stebbings17:18

       Mm-hmm.

    7. AFAdam Fisher17:19

       So I need to find... It's a fine line, but I need to find something that perhaps is not mainstream, perhaps is not, uh, and get a headline in TechCrunch, but is also not gonna be dismissed by other investors as not interesting. And maybe because the entrepreneur, and maybe because some of the trends that this company's riding on, but I'm not gonna go completely contrarian and do something that, that everybody says that they no longer do. Um, making sure the next round of funding is, um, is accessible and doable is a critical part of my strategy. Uh, it's so easy to fail by simply not being able to raise that next round of fun- funding.

    8. HSHarry Stebbings17:58

       Mm-hmm. What does that look like though? Do you, like, map out in your head, "Hmm, these are the three players that I know would invest in this next round. This is the type of deal for X," or do you just generally have a smell test of (sniffs) "Yeah, I can, I can feel that other people would like this" (laughs) ?

    9. AFAdam Fisher18:14

       Uh, right, I don't think in terms of specific investors ever. I could never have predicted, um... It's easier to predict who will acquire a company than it is who will invest in the, in the company. Uh, it's a combination of the entrepreneur, the CEO in this, in this case, will they be able to raise money? I invest in people who I think can raise money, even when they're not, even when they don't meet their plan.... it, it's, it's, it's so important, I can't (laughs) emphasize this enough, the ability to fundraise with ease. Um, and, you know, we can talk about what that person needs to show, but, uh, they're a storyteller. They've got a history of execution, and they connect with, with, with like-minded investors. Um, the second thing is, uh-

    10. HSHarry Stebbings18:55

        Can I just, uh, dig in on that one more with that? Sorry.

    11. AFAdam Fisher18:57

        Okay. (laughs)

    12. HSHarry Stebbings18:57

        'Cause I don't... I- in terms of like the ability to tell stories, be a great fundraiser, I think one thing that's ch- challenging in the last two years in zero-interest rate environment is you got some great storytellers. With a wink and a smile, they raised $50 million, and they were great at storytelling, but there wasn't much depth to them. Do you worry that often the great storyteller and the great fundraiser isn't actually the great operator and executor, and actually sometimes the quiet but diligent person is the better one?

    13. AFAdam Fisher19:25

        Absolutely. When I say storyteller, I don't mean somebody who can perform on, on stage (laughs) or a podcast. I mean on a one-on-one conversation-

    14. HSHarry Stebbings19:32

        I get it, I'm not, I'm not gonna get funding from you today, Adam? (laughs)

    15. AFAdam Fisher19:34

        I mean on a one-on-one conversation with customers, that they can give a pitch to the customer, that they can identify the customer's pain and explain why their solution is going to work, and of course, you can't just raise on a story. Uh, you, you have to have some execution behind it. You have to show that you're, you've delivered the product that's working, that there's some customer love, that you've been very efficient, uh, that you have, uh, plans that make sense. I mean, any, any early stage company that's raising $50 million, I don't know what stage that was that you were thinking about, it's inappropriate. Uh, those are not the type of invest- the, of entrepreneurs that I back.

    16. HSHarry Stebbings20:12

        I mean, in, in the last few years, it could have been pre-seed at that rate. Um- (laughs)

    17. AFAdam Fisher20:15

        You wouldn't, I would not have been involved.

    18. HSHarry Stebbings20:17

        It wou- it would not have been a deal for you. Um, I, I totally get you. Can I ask you something about efficient, um, before we get to your second point? Um, you know, like, God, I really drilled down, but you said about efficient. For founders that listen, has there been a fundamental mindset shift in you and how other ambassadors think in terms of when analyzing a company, I want to see efficiency, not just growth, or actually, does growth still rule all at the early stage?

    19. AFAdam Fisher20:41

        It, you know, it's a combination. Um, it's rarely growth at all costs, in my book. That just doesn't last, and the, and it's very painful, um, when it's, when it stops. If you're thinking about your model to your culture to where you source funding to your valuation becomes a serious problem for the company. Um, having said that, trying to focus on KPIs when a company has half a million dollars of ARR also doesn't make much sense.

11. 21:10 – 24:03

    Founders’ Efficiency & Leadership

    1. AFAdam Fisher21:10

       Um, those numbers are... if it, if it's, if they're fantastic numbers, I say it's anecdotal, and if they're horrible numbers, I say, "Well, we need a bit more scale to get a se- make sense of it." Uh, the important thing is that the company and the CEO in particular is thinking about efficiency, that it's an important, uh, attribute for them, that, that, that, that, that they care about it, that they're not just trying to satisfy, uh, me as an investor, that they also view it as a key to s- their own success.

    2. HSHarry Stebbings21:37

       Well, so I'm, I- I am really learning here. And so, (laughs) this is, uh, a teaching session. What are signs that someone cares about efficiency? Is it in terms of how they talk about, you know, uh, ramp time for sales reps? What is that, this founder's got a good eye towards efficiency?

    3. AFAdam Fisher21:52

       It, it starts in the very beginning. Um, I can't tell you lately, or, or at least in the past (laughs) few years, how often I met with an entrepreneur, and they were, you know, raising money for their first round, and then it occurred to me that two of the founders are still working at their previous... at their, at their current employer. They haven't even left. They haven't even shown the most basic, uh, sign of taking risk. Um, so, now you might say, "What does that have to do with efficiency?" Well, generally speaking, uh, taking risk is, is what it's all about. Um, using your own money, taking career risk, uh, w- working from, working from home in the first few months, putting on some debt on their credit card. Uh, these are really important signs. Now, those people generally go on to do things on their own, to meet customers on their own, not to hire a salesperson, but to actually figure out themselves, "Wait, how do I, how do I pitch this? What are customers actually saying?" These are critical, critical steps. So you ask, what am I looking for? Well, if they've already established the company, yes, I'd like to know, who made the first sales? I would actually expect the CEO to have made the first sales. Uh, sometimes it's the CEO has also written the first code. Those are signs of efficiency. Those are signs of, of somebody who doesn't want to hire somebody which is spending money before they know themselves that it makes sense, that they're in the right, going in the right direction.

    4. HSHarry Stebbings23:11

       I always ask, "How did you first make money?" And I find that that's very telling. The greatest entrepreneurs I find of all time when I look at pattern recognition on the people we've had on the show is all the best entrepreneurs made money or showed entrepreneurial signs in some way in their childhood. I made websites. I sold lemonade. I sold baseball cards, whatever, whatever. None of them came out of university and then got a job at McKinsey and that was the first money they made.

    5. AFAdam Fisher23:37

       Well, you're probably, you're probably right. I think the ones that have, show an entrepreneurial streak in their background-

    6. HSHarry Stebbings23:42

       Yeah.

    7. AFAdam Fisher23:43

       ... they, they, they generally are entrepreneurs, but I wouldn't exclude others. Uh, sometimes they don't, they just don't have the right environment. Sometimes they grow it up in an environment that is, uh, a little bit too conservative, that doesn't allow them to explore that. So, I wouldn't, I wouldn't write off those (laughs) who grew up in-

    8. HSHarry Stebbings24:00

       (laughs)

    9. AFAdam Fisher24:00

       ... a, you know, more corporate, uh, stayed environment. It's, it's,

12. 24:03 – 27:00

    Navigating Market Size Strategies

    1. AFAdam Fisher24:03

       it's certainly possible.

    2. HSHarry Stebbings24:04

       A- another core element when we think about kind of unpacking the evaluation or the kind of decision-making process is always market size, and I find it's one where that and price, which we can get to, but where I've most commonly gone wrong, (sighs) "Ah, I just, it's great, I love the founder, I just don't think it's a big enough market," is s- so common for our industry. How do you think about market size? Do you need the massive market day one, or do you quite like the niche vertical approach which can expand? How do you think about that?

    3. AFAdam Fisher24:33

       Well, there are some markets that-Any way you cut it, you look at it and you just say, "I just, this is never gonna be a big market." Uh, uh, and that's, that's, that's a fair assessment. Uh, I, I think I've more often been right than wrong on those. I think ... but there's a problem that investors make when ... or even entrepreneurs as well, when they, they think it's a large market but what they're really focused on is a small subset of that market, and that doesn't make it, uh, really any easier. Um, I personally like to invest in, in smaller markets, uh, for two reasons. The first is that there's unlikely to be competition (laughs) focused on those same, on that same market. Um, and the second is that if you price it right, uh, the deal that is, and you've come in at a right valuation, you can still achieve an exit in that smaller market, what you would might call a niche. Now, a niche that has no potential of expanding, that, that is problematic. I like, uh, niche areas where there are adjacent sectors, where you can understand they could grow this way, they can grow that way, they can go upmarket, uh, they can go into a second related niche. I think that's, uh, that's a fine way to grow into a bigger market.

    4. HSHarry Stebbings25:42

       Y- you said there about kind of, you know, if the price is right in those cases, you can still have great, great investments, and I, I, I completely agree with you. I think, like, you know, multiple investor capital is what I care about, not necessarily size of outcome. If get in at 200 or whatever it is and we sell for five billion, I'd rather get in at six and sell for 700 actually. But then everyone's like, "Oh, Hari, you don't get venture. Venture's about those multi-billion." Do you ever question yourself on going, like, "Should I really be doing this investment if I'm thinking, 'Hmm, it's an 800 to a billion outcome'?"

    5. AFAdam Fisher26:16

       Uh, 800 to a billion sounds fan- uh-

    6. HSHarry Stebbings26:19

       Sounds great.

    7. AFAdam Fisher26:20

       ... sounds fantastic- (laughs)

    8. HSHarry Stebbings26:21

       But it's not what funds are made on, and especially, like, when you think about a Bessemer-sized fund, it's not a fund return in, in a lot of cases. E- even wh- you know, you're thinking about 12, 15% ownership on exit. I mean ...

    9. AFAdam Fisher26:33

       I, I just have a very different approach being an early stage investor. That makes sense for later stage. Uh, being an early stage investor, you have to accept that you cannot ... the further you try and peer into the future, the, the less clear it is (laughs) and the more chance there is for, for, for surprises, both good and bad. I think when you invest in good people with compelling ideas, in big enough markets, you just have to be a bit more imaginative, um, for how it can un- it, it can, uh, unfold.

13. 27:00 – 31:30

    Small Investments, Big Returns

    1. AFAdam Fisher27:01

       My ... some of my smallest (laughs) investments ended up being, being my, my biggest outcomes, um, and I was very hesitant to make them for the s- same reason. Who would buy this? How big could it be? What is it? And $2 or $3 million turned into hundreds of millions of dollars.

    2. HSHarry Stebbings27:17

       Can you take me to one? I, I heard that Wix was a very controversial one from Byron, um, but when you say that and you say, you know, the small investment that turned into hundreds and you were quite nervous about riding, what's the one that's most poignant to you when you, when you hear yourself say that?

    3. AFAdam Fisher27:33

       Well, the easy ones are Wix and, and Fiverr for me, because at the time, you know, w- I was the first institutional investor, uh, to come in both of those. Um, the entrepreneurs themselves didn't entirely know yet what they were doing. It's, it was too early, um, and, um, and I think many other investors passed or would have passed had, had they seen it. Um, in both cases I received what would, uh, be politely say very lukewarm feedback from their partnership.

    4. HSHarry Stebbings28:01

       (laughs)

    5. AFAdam Fisher28:01

       In fact, in the case of Wix, it was outright, um, negative feedback, but ... and it arrived a little bit too late. (laughs)

    6. HSHarry Stebbings28:07

       Why was it negative?

    7. AFAdam Fisher28:09

       Um, it, they didn't present well. Uh, I, I, I wasn't at all really focused on exactly how were they gonna make money, um.

    8. HSHarry Stebbings28:18

       (laughs)

    9. AFAdam Fisher28:18

       I was just a little bit too focused on, on the entrepreneurs and, and the surface area of opportunity, of being able to create anything you want on the web, which to me just seemed like the future, uh, but I couldn't yet bring it down to a product and business model that was compelling, and so it's, it's one of my toughest investments to explain in retrospect how and why I did it.

    10. HSHarry Stebbings28:41

        Okay. If you were to do outcome scenario planning ... Do you do outcome scenario-

    11. AFAdam Fisher28:45

        We do.

    12. HSHarry Stebbings28:45

        Yeah, okay. So you do outcome ... Is that not peering into the future, like you said, that it gets less and less clear?

    13. AFAdam Fisher28:50

        It is, but I don't, I don't like to think about it p- ... Some people focus on what the outcome could be. It could be $50 million outcome, zero, 500 million, a billion. I actually focus on what could go wrong and what can go right. Forget the valuations for a second. Now, what could go right, we typically just think in terms of growth rates. Um, that's over simplistic. It, it's, that, that's just not the way a company evolves. It's not simply a, a growth rate. A growth rate is a function of, of other things that are happening in the market, in their product strategy, in their go to market. Um, you know, vis-à-vis the competition, partnerships. Uh, that requires a lot of i- imagination, but it just shows you that i- that there are, there are avenues to get there. Um, the harder part, and one we probably don't spend enough time in, is, uh, what could go wrong. (laughs)

    14. HSHarry Stebbings29:41

        (laughs)

    15. AFAdam Fisher29:42

        'Cause that's infinite as well. (laughs)

    16. HSHarry Stebbings29:44

        How often-

    17. AFAdam Fisher29:44

        And we typically just, uh, again, talk about it in terms of growth. They won't grow very fast or they might have trouble fundraising, but having done this for 25 plus years, oh, let me tell you, there are so many other ways in which you can fail.

    18. HSHarry Stebbings29:57

        (laughs) How often is what you think will go wrong the reason why a company does go wrong, versus the Mike Tyson, the thing that will get you is, you know, you know, punch in the face that you didn't expect?

    19. AFAdam Fisher30:09

        The, the hardest ... Uh, I think it's when I talk about the entrepreneur. It's when I have ... I'm unsure about the entrepreneur. Uh, I'm not always 100% on an entrepreneur.

    20. HSHarry Stebbings30:18

        And you still write them a check?

    21. AFAdam Fisher30:20

        Yes. Yes, because I try and move out of my comfort zone. I accept that sometimes I have a lot of biases towards certain types of entrepreneurs, and I can't always invest in the same Adam Fisher typecast entrepreneur. (laughs) Uh, that, even though that works for me, it's, it doesn't scale, um, and I'll probably miss out on some very good ones. Uh, but on occasion, my misgivings were about the entrepreneur, something about the...... could be a lack of transparency or po- poor communication, or just some signals in the beginning that threw me off and I wasn't quite sure to dismiss it as a bad first impression or, or something that, uh, was gonna, uh, presage what was gonna happen now (laughs) over the next few years. Um, and so those are the ones where, uh, they're also the most difficult j- 'cause y- you kind of saw it, um.

    22. HSHarry Stebbings31:12

        I totally agree with you, and, um, it's kind of this nagging feeling when you're writing the check. Like, you have it in the back of your mind that that's the concern, and that's when I'm like... One thing I don't ever do is like when I feel icky, you know when someone makes you just feel like uncomfortable and you just d-... feels off, I never write that check. Um, can, can I ask,

14. 31:30 – 35:29

    Success Through Mistakes

    1. HSHarry Stebbings31:30

       you know, you mentioned Wix there obviously being an incredible success and the lesson from it. In terms of a mistake and one that didn't go right, what's one that comes to mind there and, and how did that change your thinking?

    2. AFAdam Fisher31:43

       The ones that haven't gone right, um, I can think about four companies that I've, I've written off. Um, they're not enormous investments. I've, I've, I've yet to have an investment where I kind of doubled down and kept raising the stakes and then, and then, and then failed. I'm not saying I, I won't, but, uh, I- I'm nervous about those big losses. Um, the four losses I have are all about between $10 and $15 million apiece. Uh, the one I can think about, uh, mo- that I think about most is a, was a chip kind of company, where they're actually doing something in the area of memory, and it was an incredible, uh, technology and team, had literally 90 patents to their name, and they were pursuing a, uh, what we call an IP strategy. They actually wanted to sell the IP, um, both because it's a more efficient model, but I thought it made a lot of sense for the types of customers they were selling into. I just, I was... I convinced myself that this is the right strategy, uh, whereas their competitor was actually developing a chip, and I just said to myself, "Well, but the cu- customers that they're selling into are themselves large chip companies. They don't wanna... They're not gonna buy, uh, another chip company. They want, they want the IP so that they can incorporate it." Uh, ultimately, I was wrong, um, and I, I mention this because I was convinced that that was the right strategy, meaning I've... I, I can't hide behind anything. You know, I can say the entrepreneur made some mistakes, and he did. I can say a lot of things. But at the end of the day, that was my thesis, and the underlying thesis was, was completely wrong, and I really learned my lesson. And so anybody who now (laughs) wants to invest in an IP, uh, chip company, I'll tell them exactly what, w- why, why I was wrong. Uh, wha- what... I mean, I also have reason... I, I still can explain my reasoning and explain why I was right, but I, I know a bit more, and, uh, and it's enough just to say, uh, the, uh, to have the opposite conclusion at the end.

    3. HSHarry Stebbings33:37

       To what extent is pattern recognition good or bad? Because you now have that experience, and I don't... Um, like, I've lost money in healthcare, for example, and I get... It is so hard to make money if you're selling to any public healthcare provider. It is long sales cycles. I know all of these things. Ugh. I don't wanna touch it, and pattern recognition is really impacting my future decision-making-

    4. AFAdam Fisher34:00

       Right.

    5. HSHarry Stebbings34:00

       ... positively or negatively. But is it a good thing or a bad thing?

    6. AFAdam Fisher34:03

       On the whole, it's a good thing. Uh, I think it, it, it definitely helps you recognize, um, uh, winners that you've s- that you've seen before and gives you the confidence to move much more quickly than you otherwise would. At the same time, you're absolutely right. Uh, when you've lost money or you've seen others-

    7. HSHarry Stebbings34:20

       Mm-hmm.

    8. AFAdam Fisher34:20

       ... uh, not, not succeed in that particular thing, it, it's, it's very hard to say, "This time it's right. This time it's gonna work." But I would say that the best thing about pattern recognition over time is that you recognize what won't work. It's not what will work. Now, if you recognize what won't work, it will help you avoid spending time on, on bad deals, bad entrepreneurs, or if you're on the board of a company, bad strategies. That is where pattern recognition is priceless, and it takes time (laughs) and experience to develop that. But, but that's ultimately, um, what I think I'm paid for and why entrepreneurs are attracted to me. It's not because I know the right way. It's 'cause I know all the wrong ways.

    9. HSHarry Stebbings35:01

       (laughs) I, I think sometimes our job as board members and partners is, is actually to tell founders the people that they shouldn't hire. (laughs)

    10. AFAdam Fisher35:08

        Uh, but that- that's it. That, that- that's exactly it. I, I... The, uh, the analogy that I use is that we're not like, uh, uh... You know, the entrepreneur's the captain of the ship, but we're not n- next door, you know, shouting which way to go. We're like the lighthouse. We just tell them where the rocks are so they don't crash, but we actually don't know how to get there. That's the entrepreneur's job.

    11. HSHarry Stebbings35:26

        (laughs) Um, but

15. 35:29 – 40:46

    Hiring Process

    1. HSHarry Stebbings35:29

       I spoke to Daniel Ochoco, who's one of your founders, uh, specifically on this and the hiring process, and he said, "When it comes to hiring, I want them to meet Daniel." Uh, so... "I want them to meet Adam, and I want you as part of that interview process for candidates." I, I would love to understand from you how you do this 'cause I don't have a process. I don't have... I'd like to learn from you. How do you structure the process of an in- interviewing a candidate? What does that look like?

    2. AFAdam Fisher35:52

       I don't structure it (laughs) much. I think, uh, I, I don't want to duplicate the interview that the CEO had, um, which is about their background and, and, and do they know what they're doing and what they did. I assume that he or she has already done that. I'm trying to find things they may not have asked, so I'm gonna ask different types of questions. I'm going to assess their personality, their temperament, um, uh, with the goal to see if they're a right match for this entrepreneur, who hopefully at this point I also know their personality and temperament and style, and for this- the company. W- and with the company, that's often really just th- the stage of the company. Uh, so often, it's just a mismatch, and so similar to what I said before, I'm not so much looking for is this the best candidate, so e- as much as I'm looking is this gonna be a horrible hire that you're going to regret? 'Cause as you know, if you've hired somebody and they end up being a disaster, you've lost an incredible amount of time.And, and there's also damage. And then your next hire, you're, you're even more hesitant about making that hire. So I'm much more interested in not making a mistake with a hire than making sure that this is the best possible candidate we could hire. And a lot of that rests on the personality. Do they understand what it's like working for an entrepreneur? Do they understand what the stage is like and what they actually need to do? Perhaps they need to roll up their sleeves more than they're familiar with. Perhaps they need to hire on their own instead of relying on a, uh, a recruiting team to hire. Uh, perhaps they need to travel much more or it's international as opposed to being very local. These are all the types of things I'm trying to look for. And so I ask questions about them to understand what experiences they've gone through. How have they handled stress? How have they handled sensitive personnel situations? How have they handled disagreements or the types of macro crises? And slowly, I can try and figure out what is the kind of person this is and are they a good fit?

    3. HSHarry Stebbings37:49

       What happens more often, a mismatch between the talent and the entrepreneurial style or a mismatch between the talent and the stage of company that they'd be entering into?

    4. AFAdam Fisher37:59

       The latter because, uh, hopefully I've done my work and I figured out the, th- the personal chemistry and the founder's pretty good at that themselves, which I, again, I look for when I f- find people. Uh, but sometimes there's a mismatch in the stage. There's a big difference between being the first, like, VP of sales, let's say. Um, that's often the first executive hire 'cause they're not one of the founders. Uh, being the first VP o- VP of sales when there are no customers or when only a few customers they have are really friends of, of the founders and coming in when there are 20 customers or 100. It's a very different type of workload, um, and it's not just sales. It requires a lot of thinking. It requires a lot of patience. Um, and so that's often where you get it wrong. The person just was not ready, uh, to handle that stage or they realize that, you know what? They can't do anything on their own anymore. They really need everybody else to do the work for them.

    5. HSHarry Stebbings38:54

       (laughs) I, I think people forget that it's like, you know, maybe a three-month hiring process, six months in a role. Uh, that six months doesn't work out, and then you've got three months to kind of off-board them again and search again. It's a 12-year process when you get a m- uh, sorry, a 12-month process when you get a mis-hire. And that, in an early-stage company, can... almost, you know, fatal in some respects. And that's why also I love, uh, serial entrepreneurs 'cause they go, "Worked with Adam last company. He comes over to this company. The chemistry's there. We built it from day one again. We're, we're gonna end up repeating this process." And I love that.

    6. AFAdam Fisher39:28

       Th- that's right. E- experience in hiring is, is definitely underrated. You're absolutely right. It's one of the greatest skills of second-time entrepreneurs is that, uh, they actually don't even need me to interview any of the candidates, uh, typically. They move so fast, um.

    7. HSHarry Stebbings39:43

       It's interesting. That's what I always say though with, like, managers or with, like, VCs themselves though, which is actually like if you operated pre-AI, pre-cloud, honestly, it's such a different world now in terms of infrastructure, in terms of stack. Having operator experience technically speaking then, I don't think it makes a huge difference to versus now because it's so different. But people always stay the same and actually the ability to detect talent, hire, maintain talent, retain talent, that's always the same.

    8. AFAdam Fisher40:10

       But also knowing yourself as a manager or leader, you know, everybody's different. And the more experience you have having been in that situation, the better you are about hiring the people that are a good match for you. Are you the type of CEO that wants to kind of give somebody a, a mission and they're off and they just come back when, when they've delivered? Or are you the type that needs to know all along what's going on and, and want, want to collaborate and want to contribute? Those are very different... Those are two different styles. They're both legitimate, but sometimes it... there's a lack of self-awareness if you don't have experience having been a CEO before.

    9. HSHarry Stebbings40:43

       I totally agree with you. I love that in terms of knowing who you are. So

16. 40:46 – 43:10

    Why Founders Choose You

    1. HSHarry Stebbings40:46

       we've gone through this process and we now want to do the deal, okay? Um, we get to the deal-making stage, and Keith Raboya actually said on the show the other day, "It's such a competitive world. You have to know why the best founders choose you. If you can't answer that question, you shouldn't be in venture." How would you answer that question? Why do the best founders choose Adam Fisher?

    2. AFAdam Fisher41:07

       Well, in my local market, they choose me based on reputation. I, I hope it's, uh, personal reputation, not just the brand of Bessemer, although the brand of Bessemer definitely helps. Uh, I've been doing this for a long time, um, one of the few that are still very active and, and very active across many sectors. So I've done everything from, as I mentioned, semiconductors to consumer software to SaaS and infrastructure. I hope that my name and... precedes me but in a way that relates to the ups and downs. I mean, I make it very clear to the entrepreneur that I'm choosing them more than I'm choosing the market or the particular product, and that I'm choosing them because I'm also not just choosing somebody that I hope will succeed or, or, or, or want to succeed, but somebody that I look forward to working with even if ultimately we fail. And there are companies that I look back at and I think, wow, we didn't really do that well, but that was fun. I liked working with him or her, and you know what? I'd do it again. And so I think when you go back to what I said before about looking... thinking about an investor as a partner, as a quasi founder of sorts, somebody's going to be with you really through ups and downs, is really important. You know, I see my role as a VC as, um, picking up an entrepreneur when they're, like, on the ground because of some kind of, uh, disappointment or challenge, but also pulling them down when their head's in the clouds, when they get too giddy about some recent success or about the recent valuation or some interest from an acquirer. And that's, and that's, and that's what I try to do, and so the, the entrepreneurs that come to me, they realize that I, I, I have that balance. And when you ha- when you express that kind of balance, when you react to entrepreneurs whether it's good news or bad news with some kind of composure, they become more transparent with you, more forthcoming.... they'll share the good information and the bad information as soon as it comes in, and ultimately that's, that's the secret of a great partnership that can last.

    3. HSHarry Stebbings43:08

       I completely agree in terms of that real-time

17. 43:10 – 46:26

    Price Sensitivity in Venture Investing

    1. HSHarry Stebbings43:10

       information flow. You know, we mentioned kind of Head In The Clouds and you mentioned valuation. Now, I do have to ask on price. I, um, interviewed Peter Fenton years ago, but he said something that always stuck with me, which is that price is a mental trap, um, and it's a litmus test for conviction. How do you feel about price sensitivity, willingness to pay up and when you will and won't stretch?

    2. AFAdam Fisher43:31

       I'm typically the first institutional investor, sometimes the second. Uh, rarely have I turned down deals in the very early stages due to price alone. Uh, that price is often a function of raising too much money, meaning they didn't ask for a $40 million pre-money valuation, they asked for $25 million in their first round of financing. That was the problem. Now, I realize that as a result, it required a high valuation, but the issue for me in that situation was much more about, "What do they think they're gonna do with so much money? They don't know what they're doing yet." And that was a mismatch for me. Uh, so rarely is valuation alone the issue that, that caused me to, to back off. Um, again, being early stage, I'm not exposed (laughs) to some of the, the growth stage valuations where really you get into exit territory, and that is, that is very challenging. I'm, I'm very conscious of that. I try and make sure my, my, the companies I back never raise at valuations that they wanna sell the company at, and I warn them of that. Um, and again, I have the scars to explain what, what it, what exactly that looks like when your last round valuation is essentially ahead of the valuation you wanna sell now, and how acquirers interpret that, how you work with different sets of preferred shareholders, one that's in the money, one that's completely out of the money. It's a nightmare.

    3. HSHarry Stebbings44:53

       What happens for those generation of companies that are in that position now? We've seen many with multi-billion dollar valuations on $10 million ARR, not excessively growth, but high growth rates. What happens to them?

    4. AFAdam Fisher45:06

       I think it's a combination. It really depends on the strength of different shareholder classes. Um, there are some times if they need a lot more money, it's a recap opportunity, uh, or it's a sale at a very depressed price in which the latter investors just wanna get their money back. Uh, it's not pretty either way. It's, it's, I don't, I don't think that, uh, entrepreneurs and their investors understand how bad that situation is. And it's, it's not so much that it's a potential down round. Down rounds are not problematic. Much more problematic, again, are valuations that, uh, that are essentially in exit territory or far in excess of, of exit territory. It's really hard to recover from that.

    5. HSHarry Stebbings45:45

       A down... So I hear you, but I just also hear how fundamentally fatal a down round can be to company morale, to the feeling inside of a company of progression, and it actually is just so hard to come back from a down round. Is that inflated in your mind?

    6. AFAdam Fisher45:59

       I think it's inflated. I think if you're talking to a public company CEO, they wouldn't know what you're talking about. They'd say, "I don't understand. My stock goes up and down every day. Why should a private company be any, be any different? Six months ago, the market thought we were valued at this. Luckily, we raised at that price and I avoided dilution for all of you, but now it's back down." That's the way the market works. I think being honest as a, as a CEO and speaking to your employees like adults and not children is the way to get past it.

    7. HSHarry Stebbings46:25

       You,

18. 46:26 – 51:45

    Best Founders & Funding Strategies

    1. HSHarry Stebbings46:26

       you mentioned that it's often not the price, but it's like, it's a concern on how much they're trying to raise. It could be a very large amount in many cases. I, I often tweet about this and just the dangers of raising too much and what it entails from that. Parker Conrad at Rippling, a very famous founder in the Valley, always goes, "That's a VC-ism. The best founders know what to do with the money," and actually, you know, you're wrong, and that's just a VC trying to get smaller rounds and smaller prices. Do you agree that the best founders do know what to do with the money and can raise larger amounts, or do you take my perspective that actually no, raising too much creates a ton of excess, s- speed challenges? Which side do you sit on?

    2. AFAdam Fisher47:06

       I think it depends on the stage. I think there are growth stages where there's just tremendous opportunity, the company is growing very quickly.

    3. HSHarry Stebbings47:12

       This is pre- seed and seed.

    4. AFAdam Fisher47:15

       There is a, it's, it's... No, at, at seed, I don't think so. I think it distorts everything. Everything from the, from the go-to-market model, to how you hire, to the offices and the culture you're creating, it's all wrong. Uh, I, so I completely disagree.

    5. HSHarry Stebbings47:27

       How do you feel then about these very often, I mean, 10 is low, but 20 million seeds for AI companies that we see today? Like, would you do them?

    6. AFAdam Fisher47:36

       No, I don't. I don't do them, but for different reasons. Uh, I don't do them because the way they rationalize needing $20 million is because their six competitors also raised $20 million, and in that sense, they're absolutely right. Why would you be number six if you... And, and raise less money? If anything, you need to raise more money and show them that this number six company (laughs) is even bigger or better or, and more ambitious. That makes sense, but it's, it's, it's, um, you know, it's a backwards way of thinking.

    7. HSHarry Stebbings48:04

       It goes back to our point actually on liking things that other people don't like, and so having that won is a very different analysis.

    8. AFAdam Fisher48:09

       Right. So I, you know, I made several AI investments early on before AI was, was hot, uh, and luckily I got out, um, and with, with, with nice exits. But since AI has become (laughs) what it is, I've run the other way, uh, for the simple reason that I just can't make sense of the competition. I don't like betting o- on a horse race, and this is what it feels like to me. You're, you're, you're sitting down in the stands and there are 10 horses, and you have to assess which one is going to win.

    9. HSHarry Stebbings48:37

       I, I agree totally, but then I also fear that this is the platform shift that everyone says it is, and you have to play the game on the field, and you have to move with the tide. And I don't wanna be left in a world where vertical SaaS apps are killed by the kind of democratization that AI tooling brings and the ability to build your own instead of buy, and so I don't know what to do (laughs) .

    10. AFAdam Fisher49:01

        Well, it, I know, it's, it's hard to sit out an entire market and it feels like AI is like the equivalent of cloud, and so I'm not suggesting sitting out of anything related to AI, of course not. I'm talking about some of the very mainstream type AI use cases, uh, especially those that consume enormous amounts of, of capital with very low, very low margins. As an investor, you need to decide, are you going to make your mark by having hit one out of the park, so to speak, using baseball, uh, uh, parlance, um, or by having multiple hits, uh, and maybe also getting lucky with one that you didn't expect to get lucky? My preference is, is the latter. Uh, I go for base hits. I try and get on base, um, and then-

    11. HSHarry Stebbings49:43

        What does that actually mean?

    12. AFAdam Fisher49:45

        It means doing things that are within your control, that are, that... I, I just, like I said before, I don't think that the way you build a big company or the way you get a big exit is by investing i- in, in the most ambitious companies growing the fastest. Um, those are also the companies that crash and burn. Uh, my experience has been different. It's been companies that require patience, and that over time, figure, figure it out and surprise everybody out of nowhere. I mean, Wix, by the time it was, it was known, it was already public for two or three (laughs) years. Um, and, and then people look back and they say in retrospect, "Oh, yes, it was obvious." And I mean, when we invested, it, it was... These days, we call it a SaaS company, but back then, even though we used the term SaaS, it wasn't a SaaS company. It didn't fit our strict definition of SaaS. Uh, we were learning as we went. It was PLG, but PLG hadn't be- yet been invented yet. Um, this is what you're looking for. It's not just being ahead of the curve in terms of the market. It's being ahead of the curve in terms of how you think, how you build the company, and, uh, you're gonna miss some of the terms. Uh, there's not gonna be a term to apply for it, and you may be at a loss of words, but you're gonna say, "You know, I see here something that I haven't seen before and I really like it." And so when I go back to Wix and I think, "What did I like so much?" Yes, I liked the concept of the product and I liked the entrepreneurs, but there was something else they were doing that shocked me. They were doing things in the area of marketing, online marketing, that I didn't know you could do. There were all these types of, they called it guerilla marketing.

    13. HSHarry Stebbings51:11

        (laughs)

    14. AFAdam Fisher51:11

        That was the term they used. Um, but it fascinated me that they were thinking about that so early on, and that they would spend, at the time, $50,000 to buy a three-letter URL. I mean, now we think, oh, that's obvious, but this is 2006 that they decided that they, they should definitely do that. I love that way of thinking. I'd never heard that before, uh, and I realized, you know, this is, this is something special. If they could do that over the last 12 months, I think that was about the time I invested, then they're probably gonna do some other interesting things over the next 12 months and over the next 12 months after that.

    15. HSHarry Stebbings51:44

        Can I

19. 51:45 – 57:28

    Choosing Capital Paths

    1. HSHarry Stebbings51:45

       ask you, you mentioned there kind of about the base hits. Um, I have Bryan Zikmund on the show from Founders Fund, and he said that great inve- great venture funds are due to capital concentration in the best companies, and capital concentration, and it's the enemy of great returns. Do you agree with that in terms of the importance of capital concentration on a per company basis to really get great alpha in a venture, or as you said there, do you prefer the more bets and get lucky on one or two?

    2. AFAdam Fisher52:13

       Uh, I don't know if I fit either. I, I, I... There's no question that at the end of the day, your, most your returns are gonna come from very few deals. It's not gonna be spread evenly. That's, that's a fact. The question is can you recognize it early on or can you recognize it really at any point? And I don't think you can. I think we delude ourselves into thinking we know exactly which company's gonna be a big outcome. We don't. Um, these are all retrospective stories that we tell ourselves, and we do it over and over again. And even I do it myself, and I have to go back and look at what I actually wrote to see what I actually thought and remind myself, no, Adam, you didn't think that was gonna happen. It wasn't that... You didn't, you didn't... That was not yet a term or that was not yet a concept, uh, and you've, you've just kind of told yourself the story that makes you feel good.

    3. HSHarry Stebbings53:01

       I totally agree. In that case, should we do reserves at all? If we cannot predict the winners in that way and it's, it's us, you know, looking back with the benefits of hindsight, surely we shouldn't do reserves then, or we should do reserves to everyone as a kind of contract agreement.

    4. AFAdam Fisher53:18

       Well, I, I think reserves are for fund management. I don't think reserves are a commitment to a company or, or a team. I, I don't think... I, I think you, in order to manage a fund properly in terms of, of resources, you have to have some sense. Uh, it's just important to realize you cannot... You have to assume that there are gonna be some companies that you abandon to a certain extent, um, in terms of not investing much more. Uh, it can't be a situation where everything you've invested in is going well. You always have to decide which ones are just not good enough relative to the others. And so I think it's very important to have allocations, but also, also very important to constantly adjust them.

    5. HSHarry Stebbings53:56

       But then on the flip side, you also have to be able to tell which ones are good enough, and that's my problem, which is like there are many companies where I've invested in the seed, they've grown unbelievably fast. If I were to do reserves, I would have concentrated capital into them, and they were not sustainable growth, they were in consumer, they were in whatever they were in, and that would have been flawed because again, we can't predict which ones win.

    6. AFAdam Fisher54:18

       Yeah. I... That's right. I... Again, everybody has their own personality in terms of (laughs) investing. Mine is I'm, I'm risk-averse. I, I worry more about losing on those types of investments than having missed an opportunity to make a bit more money. Um, it works for me. Uh, I don't necessarily recommend it for everybody, but I don't, I don't mind it. I don't mind having missed an opportunity to invest three more million dollars in a company that could have generated another $30 million of, of gains. But I do worry a lot about doubling down on a company, investing another $20 million at an- when it was growing at an unsustainable rate and with, with way too much burn. That...... that causes me much more, uh, pause, and so I'll, I'll pull back on those ones.

    7. HSHarry Stebbings55:01

       Has that risk aversion ever hurt you? Say, you could've done the Wix B, you could've done the Wix C-

    8. AFAdam Fisher55:06

       (laughs) .

    9. HSHarry Stebbings55:06

       ... what- whatever you could do on the front, you could name any of your winners. But has there ever been, like, the real chance?

    10. AFAdam Fisher55:11

        Yes. I have, uh, 23 exits to my name, and in every one of them, I had (laughs) an opportunity to invest more. So, that's, that's really easy.

    11. HSHarry Stebbings55:18

        Would you not be a better investor if you didn't have that risk aversion, then?

    12. AFAdam Fisher55:22

        I-

    13. HSHarry Stebbings55:22

        Given your ability to pick, clearly, with 23 exits.

    14. AFAdam Fisher55:23

        You know, every decision you make just affects your next decision. So, it's really hard to, to do those kind of counterfactuals. I may have been, uh, gotten ahead of my, my skis, so to speak, in some of these investments, where all of a sudden I, I doubled down, let's say, on Wix and, and then there was, there was a challenge. Um, and there were challenges, and that might've affected my, my confidence to then invest the next company, which in this case, might've been Fiverr. And I might've said, "You know what? I've gone too far on Wix. I'm gonna hold back on Fiverr." So, you have to think about every decision you make and how it might, how, whether it's successful or not, how it might impact your next, next decision.

    15. HSHarry Stebbings55:58

        I understand completely. I'm just thinking about the 23 exits, the ability to concentrate capital into some massive winners. If I'm sitting in Bessemer as, like, internal partner meeting, I'd go, "Adam can pick unbelievably well. He's concerned about future decision-making on reserves. Let's have an independent person on the team actually analyze the reserve decision-making process, so it doesn't impact his decision-making." We kind of protect the preciousness of your decision-making in pick, but someone else does it. Do you think that's a good way to do it? You sometimes see firms have separate

    16. AFAdam Fisher56:30

        You could, but if you're, but if you're looking over a, a finite period of time, like, that's easy, in retrospect, to say that. If, if you now tell me to change my strategy, this could be the worst decision of my career.

    17. HSHarry Stebbings56:39

        (laughs)

    18. AFAdam Fisher56:39

        And I could be, you know, investing three times in every single company, thinking that everything I do is fantastic, and discover that I've, I've just erased half my gains. I don't think that's really possible, but-

    19. HSHarry Stebbings56:48

        (laughs)

    20. AFAdam Fisher56:49

        ... but you know what I mean. No, I don't, I don't think so, and I don't think you can really change, uh, your style that easily. It, you get out of your comfort zone when you invest a lot more money at a lot higher valuations. Uh, you actually end up, um, behaving a little bit different as a board member, even. Um, when all of a sudden you have $100 million of cost basis in a company, and which I, I do have several companies (laughs) where that's the case, the way you think about things is, is more risk-averse. All of a sudden, you, you kind of shift gears, um, and you start thinking, "Wait a minute, how do I ensure that I get 1X? Forget about the 5X that I dreamed of." Uh, and if you don't wanna be in that situation, then don't get there.

20. 57:28 – 1:02:12

    Cracks in Founder-Investor Alignment

    1. HSHarry Stebbings57:28

       What do you think are the biggest misalignments between founders and investors? Like you said there, you know, when you have $100 million in your brain, you have a very different mindset to risk. What do you think are the biggest misalignments between founders and investors?

    2. AFAdam Fisher57:39

       Well, early stage, there's not that much, because generally, at a certain point, you know, you've, you've acquired enough and, uh, hopefully the company has accreted in value, and you're kind of both in the money. I think for later stage investors, there's, there's misalignment, especially when founders start to sell secondary, and those growth stage investors are, are kind of stuck. Um, uh, and I think it's just less appreciation for that growth stage, where founders tell themselves, "Listen, I, I worked to get to this point. I spent seven years, you know, toiling and getting a low salary. I deserve to sell." But the growth investors don't care what they did in their past. All they care is about the future that didn't happen as they hoped it would. And so, there's, there's just true misalignment. I just don't think the same is true of, of early stage.

    3. HSHarry Stebbings58:23

       Have we got to the stage in the cycle now where late-stage investors, they just want their money back? Just give me my money back. I wanna recycle. I wanna distribute. 1X is fine.

    4. AFAdam Fisher58:32

       100%. That is exactly what's gonna happen over the next 24 months. Various ways in which to get, you get your 1X. And when you know that you want your 1X, you want it now. You don't wanna wait two, three, four years from that, not only from an IRR perspective, just in terms of, uh, the, the time commitment and, and the risk. You know, as m- as time goes on, the risk can get worse. That 1X can become 0.75X or half an X, and then you get even more stressed about it. Um, and I don't think entrepreneurs fully appreciate, uh, that situation, when they have a set of investors that just wants their money back, and how that affects decision-making at the board level.

    5. HSHarry Stebbings59:09

       Do you think that's fair to ask of founders? Like, when you actually think about it, you know, we invest in you because we believed in you, the company, the vision, whatever it is. Even at late stage, it's not your money anymore. You invested that. Like, you have no right to be like, "I want my money back."

    6. AFAdam Fisher59:24

       Oh, no, they're not, they're not, they're not gonna say that. Uh-

    7. HSHarry Stebbings59:26

       Well, sometimes they do.

    8. AFAdam Fisher59:27

       I'm not on those boards, to be honest. (laughs)

    9. HSHarry Stebbings59:29

       (laughs)

    10. AFAdam Fisher59:29

        Not yet, at least. Um, I think if I, if I was, I would tell the entrepreneur to ignore them and, uh, and to figure out how, you know, to tell them why they need to be patient, and why you still appreciate them as an investor. And understand that it, it might not be the outcome that they'd hoped for. But there's a way in which th- to do this that is in the interest of all shareholders, including them. And they, you know, still get their mon- They still will get their money back, but that's it.

    11. HSHarry Stebbings59:56

        But Adam, help me, 'cause like, M&A's not exactly a, a incredibly active market. You know, obviously Figma put a lot of downers on a lot of M&A hope. Um, so where does that liquidity come from? Where does that 1X come from?Like you said, about kind of the, ah, depressed pricing and sales-

    12. AFAdam Fisher1:00:09

        (laughs)

    13. HSHarry Stebbings1:00:10

        ... eh.

    14. AFAdam Fisher1:00:10

        I di- I didn't say it was easy. I, it depends on the company, I think, and, and, and the price they're willing to, to sell at.

    15. HSHarry Stebbings1:00:16

        But do you think, like, there is even liquidity windows open in anyways for these 1Xs back?

    16. AFAdam Fisher1:00:21

        I think there, I think there will be. I think it's just a matter of price, um, and matching it. A lot of these companies grew very quickly, burned a lot of money. But without burning a lot, they can't grow at all, and, uh, they have to right size. Then all of a sudden, that company that was doing, it was growing 100% and is at $50 million is now still at $50 million and, and not growing at all, uh, and still burning money. And how much is that worth? It's, it's worth, uh, a very low multiple of that. And I do think there are acquirers for these companies, um, but it's, it's, it's hard, it's hard to get there, you know. It's, like, you always want the previous deal. This is the stage where you always want the previous deal. You want what they off- wh- what you could've had before. And, and you have to preempt, you have to preempt that, meaning-You have to realize that it only gets worse from here (laughs) and so you, you actually have to get ahead of it and accept what is ostensibly a low offer. Because if you wait, you're gonna want that offer, but it won't be around anymore.

    17. HSHarry Stebbings1:01:17

        It's so true, you always want the previous deal. The amount of times I've said, "You know, I would have loved to have done Adam's last round." (laughs) And so-

    18. AFAdam Fisher1:01:25

        Well, in a, in a up market, it's the other way around. You, you, you kind of want, you want the next deal 'cause it all goes up. (laughs) But in this market, you want the previous deal, but it's much harder psychologically to, to realize that, to realize that you're on your way down. You don't need to act like it. You actually p- pretend that that's not the case, but you need to decide as if that is the case. You're sliding down the side of a mountain, right? If, if you, time is not on your side, you're gonna hit bottom. And so you want that previous deal and just, uh, uh, preempt it. Try and find a way to get, to get, to get the acquirer to make an offer you don't really want, but then to take it.

    19. HSHarry Stebbings1:02:01

        (laughs) So speaking of kind of taking the offer, Daniel at Chalkboard said, "Most investors, or many investors, have good investments. Adam has good exits. Like, the man knows how to make money." My

21. 1:02:12 – 1:06:32

    Timing and Liquidity in Investing

    1. HSHarry Stebbings1:02:12

       question to you is, how do you think about when to sell, how to think about liquidity? What have been some big lessons for you there?

    2. AFAdam Fisher1:02:19

       When to sell, it's typically when I think the company has peaked, um, or is about to peak, I would say, uh, ahead of it. Uh, if it's, if, if it's peaked, I'm already probably, it's, it's too late. Um-

    3. HSHarry Stebbings1:02:31

       Are you good at predicting the peak?

    4. AFAdam Fisher1:02:34

       I am. I think I am. That's w- that's, that's, that's one of my skills. (laughs)

    5. HSHarry Stebbings1:02:38

       (laughs)

    6. AFAdam Fisher1:02:39

       Uh, I, I am because I have a, I have a lot of exits where that is the case. Um, and it's a combination of the business just not really working the way we want it to. Um, it might not be efficient. The market might not be as big as we thought. Um, we may not be able to spend money to make money, if you know what I mean. We can, we can double the head count, but it won't really change anything. Uh, maybe because competition is really gaining and this whole market's gonna be awful. Low margins, too much competition. And so you have to be ahead of it. You've just gotta be slightly ahead of everybody else. It's just like investing. You just wanna be six months ahead of everybody else. Same thing at exit. You wanna be the first to exit. You don't wanna be the last. And so in orchestrating this, the first thing is to make sure that the CEO's on the same page. Sometimes they are. Sometimes they're the first to come. Other times, you have to actually work with them and explain the risks of continuing with the same strategy. Uh, and that takes time, but if you have a good relationship, if they understand that they're still gonna do well and make money, or that you're gonna take steps to ensure that they're gonna make money on any kind of outcome, you can work together and figure out, okay, what do we do now? Who are the likely buyers? How do we get close to them? And this is not a decision that within three months then you have offers. It's typically a year-long, if not more, process. Um, now, this takes me back to how I invest in entrepreneurs and what I look for. I look for people who are, like I said, storytellers, have charisma. I look for people who I think acquirers would want to a- buy. Like, the person, not just the company and the product. That they get excited about that person leading a division or a group within their company. And then I tell the entrepreneur, "Listen, as much as you built a great product and you're in a hot market, let me tell you something. We're not gonna be acquired for that. They're gonna acquire you. Now, don't let this get to your head, but you need to understand that if you can win them over the way you won me over four, five, six years ago, you got it in the bag." And so I would say at least six or seven times, um, I've had exits where, I mean, the company was almost worthless, you know? Less than $2 million of, of, of revenue, and we had offers that, uh, shockingly good. Um, I mean, and just, you know-

    7. HSHarry Stebbings1:04:52

       Why, why were they shockingly good for a company with less than two million? Is this a pure technical buy? This is a pure acquirer hire?

    8. AFAdam Fisher1:04:58

       It's a, it's a combination. It's a combination. It's never just technology. It's usually a team, technology, um, and of course, timing. Um, and you have to ensure that the, the buyer feels like they're getting something that they couldn't otherwise get. Um-

    9. HSHarry Stebbings1:05:15

       I think the thing that's terrifying in venture distributions is when you look at the kind of historical arc of venture distributions, there's these tiny finite windows which is really where the majority of returns, uh, are predicated. And if you don't fit in them, it's very hard to make money in this business at all.

    10. AFAdam Fisher1:05:30

        Yeah. Timing is so important. It's, it's, it's, it's, it's hard to know where you are. (laughs) Uh, all you know is the past. You have no sense of the future. But, uh, it, it's, it's critical, uh, and ultimately these companies that I mentioned, you know, within a certain amount of time, it was clear that wow, we sold at peak. Either it was market peak or company peak or, or the acquirer themself afterwards, their stock dropped or, uh, uh... Now, I've had the opposite. I've had situations where, you know, acquisition offers were pulled because something happened to that acquirer, right? You know, in other words, the worst possible time. Um, but, but that's how you engineer it. And of course, it's easier when it's not a very well-known company, when there weren't a lot of headlines, when they don't, they're not burning a lot. You know, acquirers don't want to buy ongoing losses, so you have to have a manageable burn. And of course, that, the, the various ways of looking at that, but it's typically as a percentage of the acquirer's, uh, um, uh, EPS, (laughs) uh, how much they can absorb, how many, how many kind of losses they can absorb.

    11. HSHarry Stebbings1:06:30

        Adam, I, I love this, but I, I do wanna ask

22. 1:06:32 – 1:09:44

    Honest & Fearless

    1. HSHarry Stebbings1:06:32

       one final question before we do a quick fire, which is slightly off-piece compared to what we've done, which is, you've taken, uh, you know, a very proactive stance, and Amit on your team told me to ask this, so I hope it's okay. He said you've taken a very proactive stance really fighting against Israeli judicial reform and now fighting for Israel's right to protect itself against global antisemitism. And I've seen some of these, especially on Twitter. Uh, why did you decide to be so active publicly, especially also, and this sounds awful, when it, it's easier to not and most don't?

    2. AFAdam Fisher1:07:01

       I think I just reached the stage in my career, um, when I don't really care for any repercussions and that I trust myself to express myself in a way that, um, is honest.... uh, and not antagonistic. And, um, you know, if you're going to have a, an independent mind and live in a, in a place that's free, you know, if, if you don't feel comfortable expressing it, then it's just not worth that much. And so, that was the realization I made. The, the first was in, um, la- uh, in, in 2022, uh, when, uh, the new government in Israel was formed. Even before the so-called judicial reform was announced, I, I could see it happening and I, and I wrote about it (laughs) on my Medium, um, blog. I, I said, uh, this, you know, this government's going to try and gut the, the independent judiciary. And I said, explained why, and I explained why it was so bad in the context of Israel's political structure, um, and it was a very vocal move. But I said, "I don't care if there are some people, entrepreneurs, that don't agree with me, you know. What's the worst that can happen? They won't, they won't come to me, fine." But I felt that was a fraction. Um, what I didn't realize, that there were a few others who felt exactly as I did, uh, venture capitalists in this case, who also spoke out. Within days, the entire tech sector, you know, 90% was on the same side. That's reassuring. Uh, the, I bet, I think maybe a better question would be, what if, what if there was more of a backlash? Would you have continued? I, I, I think so. I think carefully about, about all these issues, and I attempt to think carefully and patiently before I write. Obviously, sometimes you write, uh, quickly on, on platforms like Twitter without, um, without thinking, um, i- it at all through. Um, but again, I trust myself. I know the issues, um, and I'm not afraid to say also if I make a mistake that, you know, I, I misspoke or I miswrote. Although I don't think I have in the past year.

    3. HSHarry Stebbings1:09:00

       You have had debates with, with some very prominent Silicon Valley, uh, investors, entrepreneurs. I mean, like, bluntly PG comes to mind. Um, is there backlash there, though? 'Cause there's a, there's a PG army.

    4. AFAdam Fisher1:09:13

       No, I'm not aware of it. Actually, there was never a debate. Uh, most people I've engaged with, they block me right away, so they're not interested in any alternative opinions. Um, I would've liked to have a discussion. Um, no. I mean, the, the Israeli market's very different. That's my market. Um, it's not a name that's spoken about much. Um, mine is more prominent, so I didn't think much of it.

    5. HSHarry Stebbings1:09:36

       Listen, I, I've so enjoyed this. I wanna do a quick fire. So I say a short statement and then you give me your immediate thoughts. Does that sound okay?

    6. AFAdam Fisher1:09:42

       Sure.

    7. HSHarry Stebbings1:09:43

       Okay. So let's do,

23. 1:09:44 – 1:13:07

    Quick-Fire Round

    1. HSHarry Stebbings1:09:44

       what have you changed your mind on in the last 12 months?

    2. AFAdam Fisher1:09:47

       Well, uh, I'm usually the kinda person who says that, uh, I am, uh, pessimistic about the short term but optimistic about the long term. In the last 12 months, I've felt the opposite. I hope that reverts. Um-

    3. HSHarry Stebbings1:09:59

       You're optimistic about the short term and pessimistic about the long term?

    4. AFAdam Fisher1:10:03

       Uh, yes, yes. Uh, in, in the context of, in, of, of Israel and business, I think business, uh, has bottomed out and things are getting better, uh, for now. But I do worry, for instance, in venture capital, that there's still far too much capital, uh, to make this, uh, a, a business that we can all do (laughs) or even a lot of us can do well in. And when I... in the context of Israel, yes. Like, we've, uh, I think, uh, back where we were even 12 months ago in terms of this, the judicial coup, uh, we're in a much better situation. I think security wise over the last three months, things have actually improved even though it doesn't look like that. But I do worry a lot more about the long term, and that's a bit of a flip, uh, in my mindset. I hope, I hope I revert, (laughs) uh, back to where I was in, in, over the next 12 months.

    5. HSHarry Stebbings1:10:50

       Geopolitically, are you optimistic? I'm quite-

    6. AFAdam Fisher1:10:53

       No.

    7. HSHarry Stebbings1:10:53

       What? Yeah.

    8. AFAdam Fisher1:10:54

       No, no, no. No, again, short term I am, uh, but I, I worry about long s- there's a lot of long term trends. In the case of, uh, the US I worry a lot about isolationism.

    9. HSHarry Stebbings1:11:03

       Yeah.

    10. AFAdam Fisher1:11:04

        Um, which I actually think is the natural state of the United States. Um-

    11. HSHarry Stebbings1:11:07

        Do you not think we're moving to an isolationist world though-

    12. AFAdam Fisher1:11:10

        We are.

    13. HSHarry Stebbings1:11:10

        ... actually, and we actually operate in independent blocs? There's China, there's Europe, the US.

    14. AFAdam Fisher1:11:13

        No, we are, no, we won't. We're going to attempt that and then we'll discover yet again that it's impossible and it's a disaster. Uh, we're gonna, we're gonna recreate the-

    15. HSHarry Stebbings1:11:23

        Is that a decade-long failure attempt?

    16. AFAdam Fisher1:11:25

        It, it probably is. It probably is, yeah.

    17. HSHarry Stebbings1:11:29

        (inhales through teeth) Do you worry about Trump getting in?

    18. AFAdam Fisher1:11:32

        Yes.

    19. HSHarry Stebbings1:11:33

        Do you think he will?

    20. AFAdam Fisher1:11:34

        I, I think there's a real good chance, yeah.

    21. HSHarry Stebbings1:11:37

        Yeah. (exhales) What's the biggest misconception of the Israeli startup ecosystem? (laughs)

    22. AFAdam Fisher1:11:43

        Oh, it's probably that they're all techies and they're all in cyber security, which is just not the case. I've backed a lot of entrepreneurs that have no technical background or minimal technical background, um, and obviously have very few if not any cyber security companies. Uh, I've got entrepreneurs who were lawyers, um, in HR, um, you name it. And so I think that's a big misconception.

    23. HSHarry Stebbings1:12:07

        Uh, uh, the thing that I didn't find was the commonality of the name Ido or Ido. (laughs)

    24. AFAdam Fisher1:12:11

        (laughs) .

    25. HSHarry Stebbings1:12:11

        When I was speaking to you, I'm like, "Ido? I have 50% a Ido." I'm like, "Ido?" "That was me."

    26. AFAdam Fisher1:12:16

        (laughs) .

    27. HSHarry Stebbings1:12:16

        "Okay, good." Um, tell me, what's the best investment advice you've received?

    28. AFAdam Fisher1:12:21

        I would say it's a, there, there are two pieces of advice which are contrary. The, the first is that when things are, are just going awfully right in the beginning, like, just get out. Like, stop right there. In other words, within li- if within, if within 12 months or 18 months just every- all your assumptions are wrong, the entrepreneur's awful to work with, the market doesn't look right, just, just stop right there. Don't, don't try and fix it. Um, but the second piece of advice that I received was that oftentimes, 90% of the value that is created in the company happens in the last 12 or 18 months of the company's life. And so, that requires both patience but also recognition that, that sometimes that's the way it works out, and there are companies wh- that, that, that's the way it's gonna, uh, manifest itself. And so, it's that combination of being able to cut, but also being patient and knowing when to apply what.

Episode duration: 1:17:39