Kevin Hartz: "How I Lost Airbnb at Seed Because of an Exploding Term Sheet" | E1180

ℹ️ EPISODE INFO

Released

July 22, 2024

Duration

1h 9m

Channel

The Twenty Minute VC

Watch on YouTube

▶ Open ↗

📝 EPISODE DESCRIPTION

Kevin Hartz is a Co-Founder and General Partner at A*, an early-stage venture capital firm. Prior to founding A*, Kevin co-founded Eventbrite, a publicly traded company, and served as the CEO for the first 11 years of the company. Before Eventbrite, Kevin co-founded Xoom, a money remittance company that was acquired by PayPal in 2015 for over $1BN. Kevin is also a prolific angel investor having backed companies such as PayPal, Airbnb, Pinterest, Ramp, Trulia, and Anduril at the seed stage, and was an early investor in Uber, Palantir, SpaceX, Square, Gusto and many others. -------------------------------------------------------------------- Timestamps: (00:00) Intro (00:53) Childhood & Background (03:07) Biggest Lessons from Peter Thiel (04:16) Biggest Lessons from Roelof Botha (05:10) Biggest Lessons from Pierre Lamond (07:35) Kevin's Unique Talent Discovery (08:18) How Kevin Made His First Money (09:27) The Risk of Early Capital (15:16) Serial Entrepreneurs or First-Time Founders (20:40) Why Kevin Moved from Angel to VC? (23:45) Market Sizing & Scenario Planning (26:59) Are Operators as Investors Tougher on Founders? (30:48) How Investment Preferences Shift from Angel to VC (32:50) Prioritizing Sourcing, Selecting, Servicing (34:40) Reflecting on Missed Ventures (40:25) Assessing Deal Success Quickly (41:14) Kevin’s Top 3 Value Drivers (42:25) Lessons from the Biggest Zero (47:45) Time Allocation in Venture (56:48) When to Push and When to Support (01:02:29) Investing in Mental Health & Wellness (01:04:06) Quick-Fire Round -------------------------------------------------------------------- In Today’s Episode with Kevin Hartz We Discuss:

1. What Makes the Best Founders: What questions does Kevin always ask founders in the investment process? Does Kevin prefer serial or first time founders? Why? Does Kevin prefer founders who are new to a problem or who are insiders and experts? When Kevin has gotten a founder bet wrong, what did he not see that he should have seen?

1. The Exploding Term Sheet That Cost $10BN: How did an exploding term sheet for the seed round of Airbnb cost Kevin $10BN? What did Kevin see in the seed round of Airbnb that so few other investors saw? Does Kevin agree that the best businesses often start off as ridiculous or toys?

1. From World’s Greatest Angel to VC with $600M AUM: Why does Kevin think a barbell strategy of Seed and Series C is best today? Does Kevin agree that the Series B and growth stage is dead today? Why does Kevin strongly disagree that seed is the hardest stage of the market? Why does Kevin think that venture is less collaborative than ever? How does Kevin approach when to sell vs when to hold a position? What are his biggest lessons from seeding and holding Opensea?

1. Learning From the World’s Best Investors: What have been Kevin’s lessons from his relationship with Peter Thiel? What have been Kevin’s biggest takeaways from investing alongside Roelof Botha in many deals? What have been Kevin’s biggest lessons from watching and observing the great Pierre Lamond? -------------------------------------------------------------------- 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 Twitter: https://twitter.com/HarryStebbings Follow Kevin Hartz on Twitter: https://twitter.com/kevinhartz 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 #podcast #kevinhartz #venturecapital #a* #astar #founder #angelinvesting #investment #paypal

🎤 SPEAKERS

• Kevin Hartz

  guest

• Harry Stebbings

  host

• Narrator

  other

🧾 EPISODE SUMMARY

In this episode of The Twenty Minute VC, featuring Kevin Hartz and Harry Stebbings, Kevin Hartz: "How I Lost Airbnb at Seed Because of an Exploding Term Sheet" | E1180 explores kevin Hartz on Talent, Venture Discipline, and Missing Airbnb’s Seed Lead Kevin Hartz joins Harry Stebbings to unpack his journey from angel investor and founder (Eventbrite, early Airbnb, Pinterest, Uber, Bitcoin) to running a $300M seed fund, A*. He explains how he evaluates exceptional founders, the dangers of too much capital too early, and why he rarely sells his winners despite extreme price spikes. Hartz contrasts different venture styles (Sequoia vs. Founders Fund), discusses ownership, exploding term sheets, and capital concentration, and argues that venture is entering a massive AI-driven bubble with huge upside. The conversation also turns personal, as Hartz talks candidly about his daughter’s eating disorder, mental health, and why neurological illness will be a defining medical challenge.

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