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Alex Rampell: The Best Founders Materialise Capital, Customers & Labour | The Future of Venture

Alex Rampell is a General Partner at Andressen Horowitz, where he leads their $1.7BN apps fund. Just last week, a16z announced they had raised $15BN for their latest funds, over 20% of all capital raised by venture firms. At a16z, Alex has led deals into Plaid, Mercury and OpenDoor to name a few. ----------------------------------------------- Timestamps: 00:00 Intro 01:26 How to Do 5x on a $15BN Fund Pool? 04:15 What Two Groups of Funds Will Win the Next Decade in VC? 15:13 What Three Things Are the Best Founders Able to Do? 20:35 The Best Companies Have Hostages, Not Customers 32:15 The Two Types of Deals You Want To Do In VC 37:18 The Importance of Founder/Capital Fit 40:20 Multiple Successive Rounds Are Dangerous… Here is Why? 44:01 The Importance of Ownership in Deals 57:19 Is Triple, Triple, Double, Double Dead? 58:46 Advice on Selling Companies 01:08:42 Quick-Fire Round 01:13:26 What is the Future of Venture Capital ----------------------------------------------- Subscribe on Spotify: https://open.spotify.com/show/3j2KMcZTtgTNBKwtZBMHvl?si=85bc9196860e4466 Subscribe on Apple Podcasts: https://podcasts.apple.com/us/podcast/the-twenty-minute-vc-20vc-venture-capital-startup/id958230465 Follow Harry Stebbings on X: https://twitter.com/HarryStebbings Follow Alex Rampell on X: https://twitter.com/arampell Follow 20VC on Instagram: https://www.instagram.com/20vchq Follow 20VC on TikTok: https://www.tiktok.com/@20vc_tok Visit our Website: https://www.20vc.com Subscribe to our Newsletter: https://www.thetwentyminutevc.com/contact ----------------------------------------------- #20vc #harrystebbings #alexrampell #a16z #vc #founders #revenue #megafunds #investing

Alex RampellguestHarry Stebbingshost
Jan 11, 20261h 15mWatch on YouTube ↗

At a glance

WHAT IT’S REALLY ABOUT

Alex Rampell on venture scale, founder traits, and enduring moats

  1. Rampell argues venture is experiencing a “death of the middle”: the winners will be either large generalist platforms (with massive networks and services) or small specialist funds (with deep domain credibility), while mid-sized generalists get squeezed on deal access and differentiation.
  2. He frames venture investing as buying out-of-the-money call options, emphasizing that the job is to “find, pick, and win” great deals—and winning is hardest exactly when the deal is best because founders can choose investors.
  3. On founder quality, Rampell prioritizes people who can “materialize labor, capital, and customers,” who study the history of their domain, and who have unusually strong motivation (“Count of Monte Cristo” energy) beyond making money.
  4. He also lays out three core theses for the apps fund—greenfield systems of record, software that replaces labor but must become sticky, and “walled gardens” built on proprietary data—and gives tactical advice on pricing/ownership, successive rounds, and selling companies via long-running relationship “cron jobs.”

IDEAS WORTH REMEMBERING

5 ideas

Venture winners will be big platforms or small specialists—not mid-sized generalists.

Rampell believes a “death of the middle” is playing out across asset classes: founders pick investors who either bring massive platform leverage (network, services, brand) or deep specialty expertise; mid-sized generalists often can’t win the best deals.

At scale, LPs often prefer lower multiples on more dollars.

He argues returning gross dollars can matter more than headline multiples: a 3x on $1B can be preferable to 5x on $50M, even though small funds can mathematically post higher multiples.

Venture is selling founders, not buying companies at auction.

Unlike PE, the best venture deals are “won” through founder choice. Because many great deals are consensus, access and conviction plus ability to help can matter as much as price.

Back exceptional founders who can materialize labor, capital, and customers.

Rampell’s top founder heuristic: can they recruit great people quickly (even at pay cuts), raise capital effectively across rounds, and land the first critical customers—especially hard in enterprise/vertical SaaS.

Look for founders who study domain history—and guard against ‘knowing too much.’

He sees “studied history” as a hallmark (Collisons/Stripe, Vlad/Robinhood, Chesky/Airbnb). To avoid expert bias (e.g., dismissing Stripe due to payments scars), he brings a “beginner’s mindset” sparring partner and asks what’s fundamentally different now.

WORDS WORTH SAVING

5 quotes

There is this kind of death of the middle that happens to a lot of asset classes.

— Alex Rampell

The entire job of venture capital is to find, pick, and win investments. If they're good investments, the winning is very, very hard.

— Alex Rampell

We are buying out-of-the-money call options, and we hope they expire in-the-money.

— Alex Rampell

The best companies have hostages, not customers.

— Alex Rampell

In 2025, the ability to go create a software product is so easy… This can take weeks, which is bonkers.

— Alex Rampell

Death of the middle in venture fundsScale vs multiples: returning gross dollarsVenture as out-of-the-money call optionsFounder evaluation: agency and “materializing” resourcesHostages vs customers; systems of record stickinessGreenfield bingo: selling to new companies vs incumbentsSuccessive rounds, ownership targets, moral hazardAI-era competition: weeks to copy; distribution vs innovationThree apps-fund theses: system of record, labor replacement, walled dataSecondaries and incentive misalignmentSeries A/B nomenclature drift; “Series B trap”Selling companies: relationship-building and internal buyer mapping

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