Marcelo Claure & Shu Nyatta: LATAM's New $500M Growth Fund; Investing Billions at SoftBank | E1042

Marcelo Claure 0:00 There's one fundamental, basic rule of life, and that most people don't follow it and they say they do. And that is, you gotta do what you love.

Harry Stebbings 0:11 (instrumental music) Chaps, I am so excited to make this happen. First, thank you so much for joining me in person.

Shu Nyatta 0:17 It's a pleasure. Like I said on Twitter, this is the Abbey Road of venture.

Harry Stebbings 0:22 (laughs)

Marcelo Claure 0:22 You're a lot bigger than in Zoom.

Harry Stebbings 0:24 Do you know what? So are you, Marcelo.

Shu Nyatta 0:25 Right.

Harry Stebbings 0:25 So I think we have that in common.

Shu Nyatta 0:27 Mm-hmm.

Harry Stebbings 0:27 Listen, I love a good, uh, romance and love story, and so when we go back to the beginning of Bicycle and the first conversations, can you take me to those discussions and how that formation talk really came to be?

Marcelo Claure 0:40 Uh, I met Shu a few years back, who was referred to me as I was dividing SoftBank into two. And a little people told me that I should have somebody called Shu join my team. So I called him one day and or his ki- your kid was giving birth the same day-

Shu Nyatta 0:59 M- my wife was giving birth.

Marcelo Claure 0:59 ... your wife was giving birth to a new kid. Your first one.

Shu Nyatta 1:02 No, second one.

Marcelo Claure 1:03 Second one. And it was my kid's birthday, so we immediately bonded because that was special.

Shu Nyatta 1:09 Our two daughters were born on the exact same day, and that's when we met.

Marcelo Claure 1:12 Yeah.

Shu Nyatta 1:12 (laughs)

Marcelo Claure 1:12 So we wanted to... I wanted to have a new talent join what I was doing at SoftBank. And Shu's background is fantastic. He can tell you all about it. And we immediately liked each other. We work well. We decided to open the SoftBank Latin American Fund together.

Shu Nyatta 1:30 Yeah.

Marcelo Claure 1:31 And we just had a blast, you know, finding founders, helping make Latin America better. So when it was time to do something new, you know, we both look at each other and say, "Hey, maybe we should go do something together."

Harry Stebbings 1:43 Now, you said you didn't read the questions beforehand. That's great 'cause I just decided to go off schedule. Um, when you think about yourselves as partners, what is Marcelo world class at? And Marcelo, what is Shu world class at?

Shu Nyatta 1:54 Marcelo is... I call him the master of momentum.

Harry Stebbings 1:57 Hmm.

Shu Nyatta 1:58 Nobody else generates momentum like Marcelo does. Any, any idea, any geography, any topic, if you want somebody to get the ball rolling, he'll do it. And it's impressive to see because often it means bringing together all these different people and capital and spheres of things into one project is incredible, uh, incredible. I've never seen anything like it. And so the, the gift is you just get this momentum that comes from the sky, like manna from heaven, and you have to do something with it. And so I've learned that you get out of the way of the momentum and then you try and capture that magic and push it forward in an organized way with a team. And we've done that now a few times in a row.

Harry Stebbings 2:47 If I just latch onto that, Marcelo, when you think about like speed of execution, how do you think about when is the right time to just go fast and momentum is everything versus when it should be a little bit more considered and we need to go slowly to get it right?

Marcelo Claure 3:02 Different times, different industries, different investments, different phases of your life. Now is the time to go slow, now is the time to be wise. SoftBank was the time to go fast. So it all depends, depends what you're up to. And now, once you have something good going, you have to go fast. You always have to accelerate, and that happens to every great company. First you build, you're cautious, you figure out what you're great at, and once you have it, then you press accelerator.

Harry Stebbings 3:30 What is Shu world class at, on the flip side?

Marcelo Claure 3:34 Shu brings an incredible diverse knowledge, you know, hardly ever do you see an African, a Kenyan thrive in the US that wants to invest in Latin America.

Harry Stebbings 3:47 (laughs)

Marcelo Claure 3:47 And secondly, he's a great investor, right? I don't, I don't think I'm a good investor. I think I can spot good businesses, I can spot good entrepreneurs, but there is a master to invest in. And what I can do is I can bring opportunities and I can then pass them up to Shu, and Shu often analyzes them a lot better than me. He's a little more conservative than I am, so we make a good balance. I think I'm a good operator and I think Shu is a great investor. And at the end, I believe that the new firms are gonna be the ones that have the ability to help entrepreneurs alter the course of their business. I think the days of just dump capital with access are long gone. Those were the days in which capital was free and it was readily available. Today, capital comes at a high cost and is not readily available.

Harry Stebbings 4:35 Before we dive into kind of the models of venture in the future, I, I just have to ask the obvious question: why bicycle?

Shu Nyatta 4:43 At the simplest level, it's a magnificent technology. Magnificent. It's the most... one of the most empowerth- empowering things we've ever invented as a human species. The passenger is also the engine. It's really fantastic idea for technology and what it should mean, so it empowers us a lot but we have to put a lot of energy in. So that's a core inspiration. But the other is it's timeless. I mean, bicycles look the way it's looked, two triangles and a, uh, triangle and two c- two circles for a hundred years and it's very democratic. Any street corner anywhere in the world, you'll see bicycles changing people's lives. So as a manifestation of what technology means, you'd struggle to find something that embodies that better than bicycles. And in places like Latin America where the opportunity is the middle of the pyramid, the bottom of the pyramid, nothing represents that better than a bicycle.

Harry Stebbings 5:31 And-

Marcelo Claure 5:31 Shu, Shu came up with the name. And at that, at that point in time, I was in a phase in my life that had become... I started riding bikes heavily. I was training with Lance Armstrong, so I thought Shu was being nice with me and he's saying, "Hey, let's name the new fund Bicycle." But then you start reading about bicycle and you see what Steve Jobs called the Mac, and that was the bicycle of the minds. So when you combine that-... with what a bicycle really means, I thought we have a really, really cool name. Plus, you know, Stu and I love riding bikes together, so-

Shu Nyatta 6:02 Oh, amazing.

Marcelo Claure 6:02 ... it just, it, it, it all-

Shu Nyatta 6:03 It fits so much.

Marcelo Claure 6:04 ... it all works out.

Harry Stebbings 6:05 I think it's a fantastic name and when you describe it, it, it really is very powerful and I love the analogies. I do have to ask, when I think about it, I also think about the cyclist in, you mentioned Lance, I, I loved his book, It's Not About the Bike, which ... (laughs)

Harry Stebbings 6:18 ironic. But my question to you is, when you said about the models of the future being where you really help and help some builders, operators, I actually tend to find that it was in the same vein as like a founder's fund. The best founders never need me and they just operate in isolation. (laughs) And I might be there, but they don't need me. How do you respond to the best founders don't need you?

Marcelo Claure 6:39 I think every founders, every founder will always need something, right? You know, I believe that we're lucky to have had an experience to have done a lot, right? There's, at least in my career, I'm lucky to have 32 years of probably some of the most diverse experiences that few people had a chance to build a company that became the number one company in the world, to merge a company that became the largest telecommunications company in the planet today, the most valuable one. But more importantly, I think sitting at SoftBank for two years and seeing so many industries, so many different founders, so many different models, how do you scale? How do IPO? How do you grow? How do you hire? How do you expand? And so on. I think we can always add a little bit, and there will be founders who will ask for a lot and we'll be there to provide them, and there'll be founders who will ask for a little, and that little might be a phone call that might need some guidance. You know, by no means do we think we know it all, but it's nice, I think every founder that I met, doesn't matter how smart they are and how ... and every executive in the world, they, we've always had something to add. Us, we're lifelong learners, right? Every time we meet a founders, I walk out of that room smarter than I was before because I learned so much from founders. So I think we'll always be able to add, a little bit or a lot.

Shu Nyatta 7:59 And, and just to add to that, there's a great quote that was used in basketball, but I repurpose a lot for founders. "Average founders want to be left alone. Good founders want to be coached. Great founders want to hear the truth." Great founders do not want to be left alone. And often just having a reflection in the form of a really good board meeting, I'm sure you've been in board meetings that are bad and board meetings that are good.

Harry Stebbings 8:24 (laughs)

Shu Nyatta 8:25 And a good board meeting, even if the founder's world class, makes a difference for the company. Botha and Sequoia love this crucible, uh, analogy, and it's, it's true. There are moments when that discussion, that truth seeking in a group, even for the best founders is transformative. So I push back on this notion that founders don't need anything.

Harry Stebbings 8:45 I always think advice is slightly rooted in context, if I'm honest. And I think the reason why that kind of mantra is so spoken is because a lot of VCs maybe don't also provide the value that you can. I mean, bluntly, few people can open the doors, have the momentum for companies that you can. I think that might be why. If you are a bluntly, tier two, tier three firm, as non-disparaging as I can be-

Shu Nyatta 9:08 (laughs) .

Harry Stebbings 9:08 ... there's little that you can do. Do you see what I mean? And maybe that's where it originates from.

Marcelo Claure 9:13 Well, I'll tell you a big difference though with us, right?

Shu Nyatta 9:15 Mm-hmm.

Marcelo Claure 9:15 When you look at Bicycle Fund 1, we're bringing our own capital. We're probably one of the few funds who were bringing more than $200 million of our own money, right? So we're bringing our own capital. We're bringing many years of experience and we're blessed by all the stuff that we've seen, and we're bringing pretty good contacts, right? We've been in so many different industries, and we bring that to the founder. And I'll go back and I'll say, there are some founders who will say, "No, I got it," and they will eventually need some help. And there's some founders who will just take as much as they can from you. And doesn't make one is not better than the other one, right? And, and we're there. We're on demand. And when you bring your own capital, it's a different game, right? Because we're putting significant amount of our wealth behind every single one of those investments.

Harry Stebbings 10:05 How do you think it changes the mindset of investing when it is your own capital?

Marcelo Claure 10:09 You know, you're talking entrepreneur to entrepreneur. This is a partnership, right? You're not managing someone else's money, you're managing a certain percent, but this is a, this is a big amount of capital, of our own capital, so you're truly a partner of the founder, and that's a mindset that we're going into.

Shu Nyatta 10:25 And you stop thinking in bets. It's not about placing bets and having passive beta on tech. It, it ceases to be these abstract concepts about capital allocation, becomes very personal, that each relationship is a real partnership, it really matters to you 'cause those returns matter to you personally. And that makes it much, much deeper than just a bunch of bets, which is how a lot of investors have come to think lately.

Harry Stebbings 10:50 W- we'll talk about kind of portfolio construction, kind of, um, slightly financial mechanics in some ways. But I do want to ask, I had Hunter and Sacher on from Homebrewer Fund in San Francisco, and they said the best partnerships are actually where the partners do not need the money when they start because it actually changes the decision-making that can be challenging in a lot of partnerships. Do you think that's right? And do you think being financially independent as partners makes a stronger partnership?

Shu Nyatta 11:15 Well, we're in very different phases of our life. Uh, I wouldn't call myself financially independent, but I disagree with that. I think caring matters, and the more you care, the more it matters. Second time founders can be successful if they don't need the money, but first time founders can be successful, they really need the money. I don't think there's a clean rule. I just think you need to care, and having your own skin in the game makes you really care. That's not a bad thing.

Harry Stebbings 11:42 Can I ask, you mentioned also the best founders seek the truth.

Harry Stebbings 11:45 I think what's very hard is the right way to deliver the truth and how to provide that effective feedback, which isn't always nice. If you were to advise me, I don't always do this the right way. (laughs) Um, I'm English, so often we, we, you know, don't do it very well. Um, how do you deliver really effective but hard feedback to founders? Neil Mater at Greenotes told me that you guys do it the best.

Shu Nyatta 12:07 Not much for Neil to say. Thank you, Neil.

Harry Stebbings 12:08 (laughs)

Marcelo Claure 12:09 So I'll, I'll give you my perspective. And at least from my end, it's easy to talk entrepreneur to entrepreneur, right? I mean, we, every single great founder have something called healthy paranoia. Some have an unhealthy paranoia. But we're all always nervous on what we're building, and sometimes we think that what we're building is not strong enough and we're always scared it's gonna be the end of the world and it's a constant rollercoaster. And I found that founders have a lot of respect when you've already lived that, when you can walk through, walk them through some, an experience that you have already lived. Every single founder has been in the verge of bankruptcy. Very few have not been. Every single founder has put their entire life to building their company, and it's helpful for them, at least for me, to share experiences, you know, that I learned while I was building my own company. You know, it was, it's helpful for them to understand how we scale companies and what's wha- And last thing I'll tell you, probably the best advice I even give founders is tell them the mistakes that I've made, because I made tons of mistakes, and tell them, "Be careful here, because even though it might seem obvious, it's not." And just be blunt with them. And some people like to take it in a board, some people like to be taken aside and say, "Hey, you know, this is what I'm seeing. Just be cautious here." And that worked, just being honest, blunt, and, and, you know, if, if a founder doesn't want your advice, and you're always gonna have to be telling what they wanna hear, I don't think that's a company you wanna be invested in.

Shu Nyatta 13:39 And so if you're lucky enough to have that wealth of experience, that works wonderfully. If you're not, in my case, I haven't built a company, it's much more about listening, and y- y- you have to learn from the greats who did this business, right? Don Valentine said the single advice he'd give people is to have big ears, right?

Marcelo Claure 13:56 Mm-hmm.

Shu Nyatta 13:56 And that's the most important thing. Listening, asking the hard questions, but not necessarily pontificating. Sometimes a boardroom can turn into a bunch of people speaking their mind. It's much more about finding the question that can really make the founder pause and think and potentially make a good decision.

Harry Stebbings 14:16 Can I ask a hard one? Do you think there are any areas of misalignment between founder and VC?

Shu Nyatta 14:22 Yeah, often. I mean, VCs wanna mark up the company. Often that's the goal, especially if you're early stage, right? You want the A to be lower than the B by some margin, and then you wanna raise a new fund on the back of the B or C.

Harry Stebbings 14:34 Mm-hmm.

Shu Nyatta 14:34 That's a very different goal from the founder's goal, which is to build a lasting company. Um, at the growth stage, it tends to be less the case because the markups are not fast and furious the way they are at the early stage. So I would actually think the later you go in a company's life, the more aligned you are with trying to create something that's long term, durable and successful, 'cause you can't hide anymore. It's not about the markup, it's about whether you have a real business.

Harry Stebbings 14:59 Marcelo, any... Yeah?

Marcelo Claure 15:01 Same.

Harry Stebbings 15:02 (laughs)

Marcelo Claure 15:02 And we've learned the hard way.

Harry Stebbings 15:04 Okay, now there's one for, I have to ask this one, which is, you've mentioned the mistakes that you often tell founders. Is there one common one that you find yourself saying more than others? A mistake that is the most commonly told for you where you find founders most resonate with it?

Marcelo Claure 15:20 So what I've learned from founders and from myself is, you know, trust your gut. You know, you, you know the answer. In many cases, I've seen so many board meetings, VCs who've never built businesses or who've never been around great businesses, and just everybody gives advice is, is cheap, is free, right? And many founders sometimes get confused o- At the end, a great founder, well, you know what they'll do? They're gonna listen to all of us, but at the end they're gonna trust their gut. And their gut is 90, or found is 90% right. And when you go back to them and say, "Look at the last ten decisions you made, and which ones were yours, and which ones was because you listened to the last person that talked to you," you realize that most of them are always right. That's why they build great companies. And by the time we get to in the growth stage or in other areas of our businesses, they will, they, they will already have a proven business model. They already know what they have to do. So that's, and that's often, uh, you know, that's often the case that they, they sometimes don't trust themself and they listen to others, and at the end, listen to others just so you can check that your gut was correct.

Harry Stebbings 16:28 I, I do wanna discuss Bicycle specifically. Um, we had the fundraise announcement a couple of months ago, I think it was.

Shu Nyatta 16:35 A couple weeks ago, yeah.

Harry Stebbings 16:35 Couple of weeks ago?

Shu Nyatta 16:36 Yeah.

Harry Stebbings 16:36 Time flies.

Shu Nyatta 16:37 Time does fly.

Harry Stebbings 16:38 Um, my question to you is, you know, it was mentioned as growth equity, and it's a $500 million vehicle. Can you talk to me about the focus, where it is specifically, and how you view that both from a stage and a insertion point?

Shu Nyatta 16:49 The answer is very specific to Latin America as well.

Harry Stebbings 16:51 Mm-hmm.

Shu Nyatta 16:51 So there, there are a lot of really good early stage funds in Latin America. Some local, some foreign, but it's a solid base of early stage funding. And then crossover funds, once you get to the D or the pre-IPO round, they always show up. If a company has good numbers, they will show up. The gap is in the middle. So starting at the series B, it's a bit of a desert in Latin America. For a few years there, from 2019 to 2021, it was not a desert.

Harry Stebbings 17:16 Yeah.

Shu Nyatta 17:16 And in 2021, notably, venture went from something like four and a half billion a year to 16 billion a year. Now it's back to less than a billion a quarter, so we're back to the four and a half. So there's a real gap in funding at the B and later. And the B tends to be the trickiest round, because you need some meaningful amount of capital. The A can't do, can't lead the B. They could do maybe some pro rata in the B. So you really need someone to step in and lead the round and price the round, and there's still some risk in the business. That's the real, real opportunity. And then, of course, you get opportunistic stuff at the C and D. You get good prices, maybe some secondary here or there. So that's the gap that we wanna fill with the fund. That's a product, so to speak, that founders don't have, and that's a product that LPs can't buy today, which is growth exposure in Latin America.

Harry Stebbings 18:02 Can I ask, is the fund size big enough? If you think about a series B being 40 million, say, 30, 40 million, and you wanna lead a series B, it's 25, 30 million check from you, is that big enough? You've got 12 to 14 checks in the fund.

Marcelo Claure 18:15 It's a start, right? We didn't have a lot of time.... you know, we had an idea of what we wanted to do.

Shu Nyatta 18:22 Yeah.

Marcelo Claure 18:23 I didn't know compete. Or know compete was announced, my, the end of my non-compete was a couple of weeks from when we announced the fund. And to be quite honest, we haven't even fundraised yet, right? It's, uh, Mubadala who, Mubadala wanted to make a bet in Latin America-

Shu Nyatta 18:40 (laughs)

Marcelo Claure 18:40 And we've known Mubadala for a while, both Shu and myself. And then we called five other LPs. We made five phone calls, and the five of them said yes. And they were my family office. So we really haven't started, but we wanna make sure it's, this time around, we don't wanna be the biggest. The biggest doesn't necessarily mean you're the best. We wanna get started, I think 500 million, maybe a little more is a good start, and then we'll see where it takes us. But we're, we're, I think we're lucky. I mean, we're grateful to be able to pick up the phone, call six people, and raise a fund, which is probably the largest first time fund launched in Latin America. And I think in this time where nobody's raising money or very hard to raise money to show up with a 500 million fund a couple of weeks after your non-compete expire, you know, we're lucky, we're blessed, we're, we're grateful. A lot more will come. I mean, we have big aspirations, but we need to deliver-

Shu Nyatta 19:33 (laughs)

Marcelo Claure 19:33 ... you know, you win a game playing minute by minute, and we gotta deliver the first few minutes, which is this.

Shu Nyatta 19:38 (laughs) Can I ask, when you say the biggest isn't always the best, you deployed, you know, 7.5 to $10 billion, there were different numbers that I saw, so I'm not sure which one it was, but seven and a half to $10 million, uh, billion dollars, sorry.

Marcelo Claure 19:51 Both.

Shu Nyatta 19:51 (laughs)

Marcelo Claure 19:51 It was 7.5 through Latina fund, and it was two and a half billion through the other -

Shu Nyatta 19:55 (laughs)

Marcelo Claure 19:55 ... I just never heard it's-

Shu Nyatta 19:56 Okay. So combined we have a 10, but seven and a half, uh, you know, in, in, with your time in SoftBank, what were some of the biggest lessons from that deployment period?

Marcelo Claure 20:05 Different times, right? At that point in time in SoftBank, the mandate was to build a portfolio play, right?

Shu Nyatta 20:13 Mm-hmm.

Marcelo Claure 20:13 We want to make sure that we were investing into most successful technology companies. That was the mandate of SoftBank. And I wouldn't call it unlimited capital, but we had a significant amount of capital. So that was our job to go deploy that. The Latin American fund, fund one, is a very successful fund and will continue to be very successful because we were able to fund the best Latin American companies. This time, it's all about quality nor quantity because we have a different amount of capital available to us, and because we need to make sure that the returns that we provide are absolutely the best. So we're a lot more cautious in terms of which companies we're gonna invest and which founders we're going to back and how we're gonna allocate our time, because I do believe that we can add a lot to the course, you know, to altering the course of, in, in a lot of the great businesses that are being funded in Latin America.

Shu Nyatta 21:05 And that 12 to 14 that you mentioned of number of companies is a feature, it's not a bug. We want a small portfolio in the first fund. We want it to be personal with every single company. We'll only invest in companies that are excited to have us as investors. We're not fighting to get into rounds. If they don't want us, it's okay. We don't have to be in there. And so knowing that it's only gonna be 10 to 14 is really clarifying 'cause that means, what, an investment a quarter. So it has to be real mutual love to do that. And if it's not, it's okay.

Shu Nyatta 21:32 How do you want to build the firm? You can build firms in different ways, you know, your insights on one with huge, huge teams and your benchmarks on another. When you think about the firm that you wanna build with Bicycle, it's something that I think about a lot with 20VC. W- what type of firm do you wanna build? I'll start and, and Marcelo can complement. We're lucky because we have three people who joined Bicycle day one, who we've worked with for four years, and they've been part of the journey from 2019 with the SoftBank Latin America Fund. So there's already a lot of inbuilt tribal trust and knowledge and way of working together. That's the core. And that core is very important because there's a shorthand in how we communicate. Uh, we all have the same general ambitions. People come from multiple different places. It's hard to imagine we're gonna get dramatically bigger than that. They all, the nice thing also is it's a whole spread of ages. So we already have the seeds of a multi-decade firm now. Our goal is to not screw that up, right? You have to build capability sequentially over time, but not damage the core that got you started.

Marcelo Claure 22:37 So I, I wanna make sure that the team that I've put together is the best performing team, right? At the end, I need to see Shu and the investment team. I'm the oldest one here, right?

Shu Nyatta 22:50 (laughs)

Marcelo Claure 22:50 And I, I need to make sure-

Shu Nyatta 22:51 Great sk- ... experience. ... great skincare routine- Yeah. ... is the answer.

Marcelo Claure 22:53 I, I n- I need to make sure that Shu and team don't ma- though, they don't make the same mistakes I've made. And at the end, they're gonna be running the fund. You know, I'm the chairman of the fund and I just gotta make sure that they don't make the same mistake that I made. You know, my dream is for this fund for them to just run this fund alone and let this be fund one of many more to come because I think Latin America, you know, people often underestimate Latin America. I was having lunch with a very prominent Indian businessman and Latin America, if you add the GDP of Latin America, we happen to be 2X India with one-quarter of the people or one-third of the people. So Latin America has the size, has 600 plus million, a big population. So there's a lot to be done in Latin America that we just got started at SoftBank. And the few success stories that you have today have given birth to a lot of other hopes, dreams that are in the process of being made, new journeys that are being made because now Latin America has a lot of futures of success, right? You look at Nubank, great example, to me, the world's best digital bank. Look at MercadoLibre, nothing to envy to an Amazon or to, uh, an Alibaba, et cetera.

Shu Nyatta 24:09 You look at Globant, which is real software building shop from Argentina that serves clients globally. Not the sort of thing people associate with Latin America. So different kinds of companies get created in the region, which is-

Marcelo Claure 24:20 And the market-

Shu Nyatta 24:21 ... surprising to most people.

Marcelo Claure 24:22 The market is amazing.... a lo- you know, when we were investors in Uber, you know, we had to keep it a secret that after New York, three out of the top five cities were Latin American cities. Latin America, uh, the economy is one that will, that will take on any new digital disruption at an accelerated pace. Look at Netflix, WhatsApp, and all that.

Shu Nyatta 24:42 You mentioned TikTok.

Harry Stebbings 24:43 Mm-hmm.

Marcelo Claure 24:43 Yeah. Latin America is a huge market for them.

Harry Stebbings 24:46 Uh, it's been unbelievable for us in terms of-

Marcelo Claure 24:47 Helping, helping Shein.

Harry Stebbings 24:49 ... Latam audiences. Yeah.

Marcelo Claure 24:50 You know, Latin America is absolutely booming, right? So it's great to be in a market where you have, it's the early stage of entrepreneurship, but with great founders. But also you have a market that's ripe for consuming any digital good-

Harry Stebbings 25:06 (laughs)

Marcelo Claure 25:06 ... at an accelerated pace.

Harry Stebbings 25:07 I, I am, before we dive into Latam, I did just have to ask, on the firm itself, you know, what do you think is the biggest challenge that you are yet to prove out? So an example, like when I think of mine, is so I can build a firm beyond myself. (laughs) Every fucking LP asks that. Um, how do you think about what your biggest challenge is in terms of the firm build ahead?

Shu Nyatta 25:27 I think it's really tied into the region. Nobody doubts that you could create a growth equity firm in this day and age.

Harry Stebbings 25:33 Sure.

Shu Nyatta 25:33 Lots of people have done that. The question is, can Latam support a multi-fund growth equity firm? We strongly believe the answer is yes, we think it's obviously yes. But that's something the rest of the world doesn't quite believe yet, and so it'll take time to prove that out. And in a sense, that makes the task very simple. We just have to execute. We have high conviction in what we're doing. We just have to put one foot in front of the other and the, the proof will emerge over time. And that proof is in the form of big outcomes. So you want the next new bank to go public in New York. Like that'll kind of quiet the critics. But it's getting over the regional argument really, 'cause we're very tied into the story of Latin America.

Marcelo Claure 26:15 There's a misconception about the region, right? I mean, you ask some people and they think, "Oh my God, this is the land of drug trafficking, high inflation and constant political turmoil."

Harry Stebbings 26:26 (laughs)

Shu Nyatta 26:26 Soccer.

Marcelo Claure 26:26 And, and soccer, which is great.

Shu Nyatta 26:28 (laughs) .

Marcelo Claure 26:28 Football, for you, sure.

Shu Nyatta 26:29 Football, yeah.

Marcelo Claure 26:30 Uh, it's, it's the opposite. You know, Latin America is, to me, the land of opportunity. And I think Latin America is the only place where, which is great, because there are more opportunities than capital available. Everywhere else, there's more capital than opportunities available, which drives crazy valuations and others. So I think we're in a great place. We understand Brazil, we understand Mexico, we understand Colombia, which are the three largest markets. And I am a huge believer in the macro story of Latin America, and I think the next 10 years are gonna be the best 10 years of Latin America, for two very, very simple reasons. One is nearshoring. I mean, long go, long are the days where companies will have one supply chain and be only China. And if you wanna serve the other side of the world, Mexico suddenly becomes a place to serve the US, so nearshoring, it's real, very important. And secondly, commodities are gonna be an important part of the whole new energy model or the electrification of the world. And few people know that between Bolivia, Argentina and Chile, that 60% of the world's lithium. It means that's, Bolivia alone is one third of the world's lithium. So suddenly go, tho, those prices of those commodities are gonna be steady for the next 10 years, and Latin America is sitting on that. I don't know if you know, but Brazil will become the largest food exporter in the world. So all that means is these con- these countries are gonna be, I will call them economically sound. I'm not gonna say they're gonna thrive, because a lot of people have said that and made mistakes, but I feel very good about the future of the economy of the two most important markets in Latin America, which is Mexico and Brazil.

Harry Stebbings 28:12 Can I ask-

Shu Nyatta 28:12 It's nice to have tailwinds, and they have tailwinds.

Harry Stebbings 28:15 Everyone needs a tailwind.

Shu Nyatta 28:15 Everyone needs a tailwind.

Harry Stebbings 28:16 (laughs)

Harry Stebbings 28:17 One thing that I'm always struck by is, it is the difference of opinion I get on homogeneity of Latam, where some people kind of block it together and go, "Latam is an opportunity, is this huge opportunity, and look at the, uh, kind of collective audience we have here of 650 million," and it's basically the, yeah, whatever we wanna choose, this huge market. And then others say, "No, it's incredibly fragmented. Each country is very individual. It's much more European in its structure, where you have to win Mexico, Argentina, and you can't look at it as a kinda block opportunity." Which one's right, do you think?

Shu Nyatta 28:50 Well, for sure there's Brazil and everything else.

Harry Stebbings 28:53 Yeah.

Marcelo Claure 28:53 And Mexico.

Shu Nyatta 28:54 But even language is different in Brazil. So you have what's generally called Spanish-speaking Latam, and Brazil, which is not Spanish-speaking. Brazil is its own beast. Mexico is also a large entity within Spanish-speaking Latam. So if you were to disaggregate two countries and pull them out, it would be Brazil and Mexico, in that order. And if you ignore everything else, those are huge markets. That's more than half of the population of 650 that Marcelo mentioned, and most of the purchasing power. And two very well-run central banks that have performed incredibly over the last two years. The currencies of Brazil and Mexico have been some of the best performing currencies in the world because the central banks hiked early, Brazil is already on the phase of easing interest rates. So these are two really interesting economies with tailwinds. And then you have, as a plus, some of the other markets. Some will always be challenging. Argentina has perpetually been a challenging market. It's never gotten currency under control. It's very difficult to, uh, figure out what the value of your Peso is over time. Colombia is having a challenge now, uh, but we're long-term bullish on Colombia. But if you really had to focus, it's Brazil and Mexico. And in a sense, I suppose that would be like Germany and France, you know, if you wanna pick the EU example. I'm, I'm sure in Europe there's a similar answer to-

Harry Stebbings 30:08 Mm-hmm.

Shu Nyatta 30:08 ... where here are the two markets that really matter. And that's, th- the same is true in Latin America.

Marcelo Claure 30:12 But I will add two things, right? It is suspected that both the Brazilian and the Mexican economy will be among the top 10 economies of the world, so it's nice-

Shu Nyatta 30:20 Top six, yeah, 2050.

Marcelo Claure 30:21 Okay? And then secondly, Argentina is great because in Argentina you have something that you can export, which is...... services, people. The amount of engineers, the amount of lower-priced labor because of inflation and others. So I look at, you know, Argentina, that's why you have created companies. I wanna say that's why I think they're great on their own, you know, global and all over the world, but that was the beginning. And I think that ... And if you can, if you can, if you can play in two of the top 10 world's economies and be strong there, right? I think you can build a great firm around that.

Harry Stebbings 30:54 If we think about, you mentioned that the services and the amazing talent, if we kind of go up the stack or down the stack, whatever way we wanna take it, but to the kind of financing. We saw the evacuation of kind of foreign capital in the last year with the kind of economic changes that we've seen. Is that a good thing for you or not? In a way, there's less competition. Fantastic. And, and also in a way there's less financing available for LATAM companies and less co-investors. How do you analyze the foreign capital withdrawal?

Shu Nyatta 31:26 It's a balance sheet, the, the pluses and minuses. One of the biggest minuses is you have big pref stacks all over the place.

Harry Stebbings 31:33 Mm-hmm.

Shu Nyatta 31:34 All these companies that raised a lot of capital, whose valuations right now should be much lower than the round they did in 2021, who have pref stacks that are underwater. And it's very difficult to finance those companies even at a discount, 'cause what are you buying, right? If you're buying secondary early, uh, A shares or common shares, then you're under this huge pref stack. So I think that's a very big negative. The positive is there are fewer people competing and prices have become much more rational.

Marcelo Claure 32:03 To me, I love it, right? There's tourist, you know, tourist capital is done.

Shu Nyatta 32:08 (laughs)

Marcelo Claure 32:08 I mean, which is great. I mean, this is left for people who understand the market, who understand opportunity, who are really gonna help entrepreneurs. So, eh, it's better, it's cleaner. It's, uh, it's people who ... I mean, there were people who showed up there in late 2021 because they were, they were like sheep, right? Softbank was leading the way, and they all came behind. I think there's still gonna be left two great ones. You know, I have a lot of respect for GA.

Shu Nyatta 32:34 (laughs) They're very good.

Marcelo Claure 32:34 I mean if you look at the returns of GA, b- people often don't know, but if you truly study GA, the great returns have come from Latin America.

Harry Stebbings 32:42 It's very funny.

Marcelo Claure 32:43 Uh-huh.

Harry Stebbings 32:43 I just got off a call with Martin Escobar, uh, and he said exactly the same thing as you did in terms-

Marcelo Claure 32:49 That's true.

Harry Stebbings 32:49 ... of the tourist capital.

Marcelo Claure 32:50 So it's gonna be GA, hopefully it's gonna be us, right? And then the rest, you know, they don't even know what the capital of some of these countries are. So it's great, we like it that way, and hopefully it will stay like that. I want people to be busy thinking about the US, thinking about China, thinking about Europe, and we'll do our thing in Latin America. We're gonna help entrepreneurs, and we're gonna go help them build some of the most amazing companies-

Shu Nyatta 33:14 And, yeah, and, and-

Marcelo Claure 33:15 ... that they've proven they're capable of building.

Shu Nyatta 33:16 ... and we like to be collaborative. So the, the, their other firm, QED, has had a presence on the ground for a long time.

Marcelo Claure 33:21 Mm-hmm.

Shu Nyatta 33:21 Warburg has a presence on the ground. There's a new firm that spun out of GIC, um, that has a presence on the ground, uh, Temasek, sorry, not GIC, that has a presence on the ground. W- w- we love to co-invest with these firms. I think the A is where the elbows are sharpest.

Harry Stebbings 33:36 Yeah.

Shu Nyatta 33:36 Seed, you get a lot of people coming together. Growth, you get a number of people coming together. And so we're happy to be that catalyst for other capital, whether it's local or foreign, but we wanna price it, we wanna assess the risk, and bring other capital to the region.

Harry Stebbings 33:50 How important do you think it is having feet on the ground, being there, having offices in the cities?

Shu Nyatta 33:56 Extremely. Extremely. The- there's a lot of adverse selection. There's some founders who might or might not be great who play really well in New York and San Francisco. And so if you wait for them to come to you, that's all you'll think Latin America is.

Harry Stebbings 34:07 Yeah.

Shu Nyatta 34:08 We were just in Brazil, and we went to the middle of Brazil to a state called Goias, to a town called Goiania. I don't know how many investors have been there. They said we were the first ones to go visit them at their offices, really interesting company. Those folks are not going to New York to raise capital from 57th Street. You have to go and find them and build a relationship.

Harry Stebbings 34:27 I love that.

Marcelo Claure 34:28 And you have to understand what Latin America is all about, right? You have to have lived in L- Latin America, and we have a good group of people who lives there. You have to understand, e- you know, how people think in Latin America if you wanna be a great investor. I mean, you gotta, in many cases, speak their language. It's not about just g- showing up with Silicon Valley, about a ... I, I, I'm, I'm a believer that those days are, are long gone.

Harry Stebbings 34:54 I'm naive more so. How do they think differently? If I, you know, I, I could describe how Europeans think differently to US. If you were to compare US to Latin American people, how do they think differently?

Marcelo Claure 35:05 We have different issues, right? Our education is way worse. Our health systems are broken, so any time you bring technology to help you with health, it is incredibly ... People adopt it extremely fast. Education in many cases is pretty bad. So suddenly when you start bringing online learning methods, it's really, really helpful. Eh, transportation was broken. This is why Uber exploded. Eh, the way retailers used to mark up their goods made it so expensive that they were charging interest rates up to 80%.

Harry Stebbings 35:40 (laughs)

Marcelo Claure 35:40 So when the day that Shein shows up with something that's 70% cheaper, guess what? It, it grows beyond what anybody can ever dream of because you're solving people's need. It's a different approach to solve it. You have to understand what are the problems, so you can solve them. And I think we have a deep understanding of that, and this is why we can partner with these companies and help them grow their businesses. And it's very different, eh, in that-

Harry Stebbings 36:07 Mm-hmm.

Marcelo Claure 36:07 ... and I think that, that's why founders like us, and you will see that in investments that we're starting to make, are founders who truly appreciate the experience that we can bring to help them.

Shu Nyatta 36:18 And on the other hand, you have a lot of different kinds of sophistication. I was just in Scarsdale, New York, and I tried to buy a bagel, and they said, "Sorry, cash only." In Brazil, that's a laughable statement. Nobody would say, "Cash only." You pay instant real-time transfer from your bank account to the merchant's bank account using your phone everywhere. And-... Latin America has something like 25% of the world's FinTechs. 25%, a quarter of the world's FinTechs are in Latin America. Brazil is probably the most sophisticated financial market I've ever come across. You can securitize any stream of cash flows and sell it to the market tomorrow and it'll be purchased and distributed and bought by investors. So these levels of sophistication are not really understood outside of LATAM, and so you'll come across a company in Brazil that is very capital-intensive, but most of it is debt. And in Brazil, that's not a risk, 'cause you can actually raise a lot of debt really easily through a bunch of different avenues. So as long as it's not equity-intensive, it's still an interesting capital-efficient company. But that's more difficult to explain to somebody who hasn't spent time there.

Harry Stebbings 37:18 You said about 25% of the world's FinTechs. Um, I spoke to David at Nubank before the show also, and I clearly have far too much free time to be doing all these references. But, uh-

Shu Nyatta 37:26 Fun people to talk to.

Harry Stebbings 37:27 ... yeah, v- they are pretty cool people to talk to, I have to say. But when we think about

Harry Stebbings 37:30 kind of liquidity, and it's often another, not criticism but challenge discussed about LATAM and LATAM investing is, where is the liquidity? Nubank is one that has pr- proven immense amounts of liquidity. Dlocal, another, but not huge. How do you think about the liquidity challenge/opportunity and how do you evaluate that and discuss it internally?

Shu Nyatta 37:51 Well, so, so there's a lot missing from what you've... the examples you just gave. For example, local listings. Brazil has a very deep-

Harry Stebbings 37:58 Yep.

Shu Nyatta 37:58 ... liquid capital market, extremely. There are a lot of tech companies public i- in Brazil, and they've made investors a lot of money.

Harry Stebbings 38:06 So I'm, I'm naive. How big are they?

Marcelo Claure 38:09 Multi-billion.

Shu Nyatta 38:10 Yeah.

Harry Stebbings 38:10 They're multi-billion.

Shu Nyatta 38:11 Yeah. From, from 500... Y- you get a, a lower scale to be viable as a public company in Brazil than you do... You don't wanna be a sub-billion dollar company on the NASDAQ. You'll be-

Harry Stebbings 38:19 Sure.

Shu Nyatta 38:19 ... you'll be a rounding error for people. But from, I don't know, 500 million up to a few billion, you can list very comfortably in Brazil. And the other is M&A. Uh, Pismos just got bought. It's a Brazilian company. I'm not sure if you've heard of it.

Harry Stebbings 38:32 Uh-huh.

Shu Nyatta 38:32 They make financial infrastructure for banks, and they've been bought, arguably, I think by Visa. That's the rumor. Um, there are a number of companies from Argentina that have been bought. Okta bought an Argentine company, for example. SoFi bought an Argentine company. All of these are companies making technical infrastructure, often in financial services. And LATAM is a bit of a center of excellence for that. So liquidity doesn't have to be a big listing on the New York Stock Exchange. It could also be local listings and it could be M&A.

Harry Stebbings 39:02 Do you not think it does... Sorry, I'm, I'm pushing, but friendly.

Shu Nyatta 39:05 Yeah.

Harry Stebbings 39:05 Uh, do you not think it does have to be, if you wanna fund returner, if you wanna have scaled returns?

Shu Nyatta 39:11 Well, it depends on your entry price. And f- you need some exits that are big, uh, on the scale of the New York Stock Exchange, but you don't need all of them to be that.

Harry Stebbings 39:21 You don't?

Shu Nyatta 39:21 Not all of them, no.

Harry Stebbings 39:24 What do you think, Marcelo?

Marcelo Claure 39:26 I think it's a market in evolution. I mean, it's nice to have a, a m- a local market in Brazil that is growing fast and that's a very innovative market. So that's gonna create some liquidity for some of those companies. And it's also nice that NASDAQ will remain open to Latin American companies that have proven scale-

Harry Stebbings 39:47 Mm-hmm.

Marcelo Claure 39:47 ... that they can grow. And that's the case of Nubank and all that. I think there'll be a few IPOs coming of some great Latin American companies. Again, that makes it a little more challenging, right? Which again, there's gonna be few players, and that's what we like, right? I mean, if, if, if you're gonna be just another investor opening a new fund into something that's already been done many times like in the US, that doesn't excite me. What excites me is to go help build an entrepreneurial landscape, which we started with SoftBank, generate sufficient exits, which are starting to happen, what has happened in the last couple of years, and that's gonna create all the people who can dream that they can do the same. Latin America is under construction, right? If it was already built, there'll be other people there. And we're builders. We love that. That, at least that's what excites me.

Harry Stebbings 40:35 (laughs)

Marcelo Claure 40:35 I made a commitment to the next few years to go deep into Latin America-

Harry Stebbings 40:40 Just like... Yeah.

Marcelo Claure 40:40 ... so we can equalize Latin America. And that's, that's our mission.

Shu Nyatta 40:44 And, and there's a presumption, y- you talk about fund returners, growth is different from early stage. Not every investment has to have the potential to be a fund returner. You could have every investment have the potential to be somewhere between 2 and 4X in growth, and that's great. So if you speak to LPs, the exposure they're looking for in growth is pretty different from the exposure they're looking for at the early stage. So we don't underwrite to 20X or 10X potential for every investment. It's much more modest than that, but it has a lot less risk.

Harry Stebbings 41:13 So loss ratios. How do you think about loss ratios as part of that? I'm an early stage investor. My tolerance-

Shu Nyatta 41:18 Very high.

Harry Stebbings 41:19 ... for loss ratios is 50% plus-

Shu Nyatta 41:20 Right.

Harry Stebbings 41:20 ... in some cases.

Shu Nyatta 41:21 Yeah. As we said, this is gonna... as you said actually, it's gonna be a 10 to 15 company portfolio. Now, ideally, none of those go to zero.

Harry Stebbings 41:29 Yeah. Y- you said a brilliant thing, which is like, you know, South America is under construction. What do you think is yet to be constructed that needs to be constructed in the next three to five years?

Marcelo Claure 41:40 We have a great Series A seed, amazing funds.

Harry Stebbings 41:46 Yeah.

Marcelo Claure 41:46 I mean, I have so much respect for funds like GSEC-

Shu Nyatta 41:49 Monashees.

Marcelo Claure 41:50 ... Monashees-

Shu Nyatta 41:50 Valor.

Marcelo Claure 41:51 ... Valor. They've done great. And in a way, it's good for us-

Harry Stebbings 41:54 Sure.

Marcelo Claure 41:54 ... because they are, they are eagerly awaiting our arrival so they can partner with us because they know where they play-

Harry Stebbings 42:00 Yeah.

Marcelo Claure 42:01 ... and we respect where they play, and we don't have that knowledge to go play in their space.

Harry Stebbings 42:05 And you don't wanna go down into that space.

Marcelo Claure 42:08 We, we try not to.

Harry Stebbings 42:09 No. We don't need to.

Marcelo Claure 42:10 You know, once in a, once in a while, you dabble because you find, you know, an incredible entrepreneur with an incredible idea, and I dabble, and then Shu reminds me where we're supposed to be.

Harry Stebbings 42:18 (laughs)

Marcelo Claure 42:19 But we don't, and I think, you know, that's what... you look at the bottom, very well covered. Series B, Series C, GA, Ourself, QED, and a few others. And now we need, you know, the pre-IPO and the IPO rounds. But I'll tell you something, you're never gonna get there unless w- unless we are successful...... we need to be successful in B, C and D in order to create an IPO market. Because for great companies, there's always gonna be room for IPOs, right? Call it in Brazil, call it in the US, call it in London, call it everywhere. But we need that piece, the piece that's missing, the piece that we're gonna go attack in order to create those companies that are gonna be ready to do an IPO. So it's not about the market. I think that's a misconception. There's no, there's no big, eh, market. No. D- We haven't had those companies yet, that many, because there wasn't, you know, that sort of investors, which is what Softbank started, and we sort of have an obligation. Like, uh, like if you ask me, "Why are you doing this?" I felt we started something special at Softbank-

Harry Stebbings 43:20 Yeah.

Marcelo Claure 43:20 ... and then suddenly when Softbank decided that they don't wanna focus there, left a huge vacuum. And I personally feel that we have unfinished business that we need to go continue, so it's more than just going and deploying capital and generating good returns. To me, you know, I set a goal for the team in Softbank and that wa- that was, "We need to equalize Latin America." Latin America had the lowest percentage of venture investing as a percentage of GDP of whatever than any other region of the world, I think as close to Africa. And with Softbank we started something special. We equalized Latin America and suddenly that's starting to fade, so we need to get back there. And 500 million is a good start, but we're gonna require a lot more in the future, but we gotta get it started somewhere.

Shu Nyatta 44:04 The other thing that's needed is talent, and that's changing a lot recently. So two sources of talent in the ecosystem. One is successful companies spawn talent. Rapi is one of the largest contributors to Y Combinator in terms of alumni. Rapi alumni becoming YC companies. One of the largest contributors within the YC universe. That's pretty stunning. It's a Colombian company that went through YC itself. So that virtuous cycle happens every time a company gets big enough and spawns a bunch of talent that kinda knows how to build. The other is foreign talent going to LATAM. We've seen all kinds of people, whether they're working remotely or they move full time to the region, move... Working for companies in Mexico, in Colombia, in Brazil, because they're exciting, they're interesting. It's better than being the 20th employee at another SaaS company in San Francisco. And that changes the s- the level that, uh, people are executing at in LATAM.

Harry Stebbings 45:00 Can I ask... We mentioned the many references that I did. I... Literally every fund that you mentioned there in LATAM, I, I spoke to kind of the, the GPs there and a lot of them asked a question which I, I wasn't sure if I was allowed to ask, but we'll ask it and we'll see if I'm allowed to. Um, and they said when you

Harry Stebbings 45:16 look at, you know, the investing period with Softbank, what are the biggest mistakes you think you made that you're looking to correct with Bicycle?

Shu Nyatta 45:23 That's a fine question to ask.

Harry Stebbings 45:24 I'm British. It's very uncomfortable. This is why people like coming on my show (laughs) most to most journalists there.

Shu Nyatta 45:29 So, so the investing business, as you know really well, Harry, I mean, you've been doing this for long enough, the investing business is a mistakes business. It's all about making mistakes, because then you find really good things. So you can't not make mistakes. Um, I think the opportunity we saw was a lack of capital, and we tried to pursue that aggressively wherever we saw a lack of capital, and tried to build a big support organization to help the companies after we invested. Um, that worked for that scale, but I think the more... The smaller, selective, more personal touch, uh, trying to change a company's trajectory one at a time is a better approach for a region that still doesn't have the full ecosystem maturity. So that's the f- the most fundamental thing I'd change. I think slightly smaller is better for LATAM.

Harry Stebbings 46:19 What would you say, Marcelo?

Marcelo Claure 46:21 Be more selective. As I said, Softbank was a portfolio play.

Harry Stebbings 46:25 Yeah.

Marcelo Claure 46:26 It's about choosing the winners with trying to avoid any big losses. And the way we're investing into these companies are ones in which I think we're going to minimize the losses and we're not aiming for, you know, 10X, 20X. We wanna ma- If you understand the concept of baseball, which some British people do-

Harry Stebbings 46:47 (laughs) Oh, I've seen Moneyball, don't worry.

Marcelo Claure 46:49 This is, this is about hitting doubles or triples-

Harry Stebbings 46:51 Yeah.

Marcelo Claure 46:51 ... in the first fund. This is not about s- trying to invest a significant amount of capital to generate, you know, a Grand Slam. And that's... And we're very cognizant of that. We wanna make sure... We have no choice than to deliver a great fund because this is the first time fund. And as you know, you're as good as your last fund-

Harry Stebbings 47:11 Yeah.

Marcelo Claure 47:11 ... and we need to make sure that this is a great one.

Harry Stebbings 47:13 How long do you think it'll take to invest the first fund?

Shu Nyatta 47:16 Oh, a month and a half.

Harry Stebbings 47:17 (laughs) 2021, baby (laughs) .

Shu Nyatta 47:21 Well, vintage matters a lot. It's a tricky question-

Harry Stebbings 47:23 Yeah.

Shu Nyatta 47:23 ... because 2023, 2024 should be very good years to deploy capital, just statistically speaking.

Harry Stebbings 47:30 Yeah.

Shu Nyatta 47:30 But you have to resist the urge to overdeploy, especially at the beginning when every company's exciting. And so we have to pace ourselves. I would imagine something like three years.

Harry Stebbings 47:39 Yeah. No, I totally agree. Now, before we move into a quick fire, we mentioned a conversation before the show, and it wasn't in my notes at all, but I really enjoyed it, uh, and so I'm gonna ask

Harry Stebbings 47:50 it anyway. You know, often we think and we hear about kind of work/life balance, and one thing that... Uh, the reason the show's successful is 'cause I bring my own, you know, life into it sometimes, is like I'm terrified of losing an inch on work with the expansion of personal life. I wanted to ask you, how do you think about having a personal life, having a family, and still excelling in what you do and the strategy and the execution with Bicycle? What advice would you give?

Shu Nyatta 48:16 So I'm gonna, I'm gonna embarrass Marcelo here. One of the biggest things I've learned from him, he has this wonderful quote that I saw in Tokyo first and then it travels with him, so clearly it matters.

Harry Stebbings 48:25 (laughs) It travels with him.

Shu Nyatta 48:26 You can see it in every office. And th- the general gist of this quote is, "Work and play are not different things. They are the same thing, which is life." And that's a beautiful concept, 'cause there's not this partition of what you do and who you are. It's all of one piece. And Marcelo's...... wonderful quality, is it's- it's always happening together. So whether it's family, or work, or play, they co-exist. That idea of coexistence I think is a really powerful one and it enriches each of those spheres. So I've learned not to try and draw sharp boundaries between now I'm working, or now I'm at home, or now I'm playing. It's just life. And the beauty of doing something you love, as much as I love this particular job, is it's not some other thing you're doing other than your life. It's a, it's a hobby, and it's a job, and it's a passion. And it's okay if seeps into your family.

Harry Stebbings 49:19 Can I ask you a really hard one? What if your work is who you are? And I know that sounds like, uh, well, taking this into a therapy session, but like, you asked me how long I've been doing this. I've been doing this for nine years. I was 18 when I started. I never traveled. I never studied in university. I've only ever known my adult self to be this. I don't really, like my work is who I am, it is my identity. What do you say when, uh, play and li- li- life, it- it's all just that one?

Marcelo Claure 49:45 It's a phase, right?

Harry Stebbings 49:46 Yeah.

Marcelo Claure 49:48 Sometimes people ask me, like, "How do you do this?" Because I'm in a different country every day and I'm traveling constantly. And there's one fundamental basic rule of life, and that most people don't follow it and they say they do, and that is you gotta do what you love. I mean, if you, if you love your job, that's your life. But that doesn't mean your family doesn't come into it. I'm here, I'm in London, I'm on holiday, but it's a combination of, I don't know, taking my kids to Wimbledon yesterday, walking around the streets of London this morning, by being here with you, having dinner with Orelpis. And it's one of the same. And it's, uh, you know, uh, it's- it's every, every day, every week is like that. It's a combination of my kids being at work, or when I travel, you know, I usually take one or two of my kids and sometimes I'll go visit a company and say, "Hey, do you have an extra room? My kid, let's put my kid there so he can play on his iPad while I'm doing this meeting with you."

Harry Stebbings 50:43 (laughs)

Marcelo Claure 50:43 And then I take my kid to gra- grab a, grab an ice cream in the streets of Sao Paolo. It just, it's, if- if- if you're truly happy and content with what you're doing, you will bring your family into it. And your family loves that you're happy, so therefore they're happy and you make them happy at the same time. So to me, you know, there's no such thing as a work life. It's one of the same. It's, uh, it's, there's no Sunday for me. Sunday is as good as a Monday. Or I might take a Tuesday off and I might work Sunday. I mean, just, to me, it's, as long as I'm happy what I'm doing, I will give it all my best. And most people are not, and that's where they struggle with this division where, okay, work finished, I start my life. There's no such a thing. If you're happy, work and life are one of the same.

Harry Stebbings 51:25 Can I ask, do you think that's a luxury of being very successful already? Like, you can go into anything and say, "Oh, my kid's here, my partner's here," and, you know, everyone will kind of bow and give, you know, their house and, you know, any room that you need for your child to play on their iPad? Like, when you are more junior or younger, you almost feel guilty for bringing them along, for integrating them. Does that make sense?

Marcelo Claure 51:49 No. You know, I, you know-

Harry Stebbings 51:50 You don't think that's true?

Marcelo Claure 51:51 No, I, I've done, I've been doing... At least, at least for me, and my life not similar to a lot of people, but, hey, I was a struggling entrepreneur and it was the same thing. I mean, it was, you know, we used to have these staff meetings in my house. And, and, and my employees became an integrated piece of my life, and, and I became an integrated part of their families. And so I, I disagree. Obviously you gotta keep boundaries, right? I mean, don't, don't show up with your kids to a board meeting and-

Shu Nyatta 52:18 (laughs)

Marcelo Claure 52:18 ... sit in the same table because-

Shu Nyatta 52:19 Don't ask my opinion.

Marcelo Claure 52:20 ... that is, that doesn't happen.

Harry Stebbings 52:22 They might be more helpful than the VC and then you're really screwed. (laughs)

Shu Nyatta 52:25 (laughs)

Marcelo Claure 52:25 I think, I think if you're vulnerable to people, and hey, we're all normal people, right? I mean, we all got kids, we all got problems and, and just bring that on, because, I don't know, at least I found that the combination of, uh, of bringing work and your normal everyday life together, it allows you to maybe execute better. So I don't feel I'm losing an inch.

Shu Nyatta 52:46 And I, uh, uh, one thing I've learned in my fewer years on this earth, there, there are no rules. We, we're, we're born into a context and we kind of look around and say, "Okay, I guess those are the rules." But the reality is there are no rules, and so you just have to do what works for you and ignore the advice and ignore the noise and just make it work for you.

Harry Stebbings 53:06 I- I- I love that and, um, thank you for that.

Marcelo Claure 53:09 Create your own path. Don't follow everybody's footsteps.

Shu Nyatta 53:13 (laughs) 'Cause nobody knows what they're doing.

Marcelo Claure 53:14 And then-

Harry Stebbings 53:14 It's a secret.

Marcelo Claure 53:15 ... you're gonna be, you're gonna be another one of them. And you don't wanna be another one. You, you didn't build this podcast or what you're doing right now by just following the normal routine. This place where I am now is not a normal-

Harry Stebbings 53:27 Office.

Marcelo Claure 53:28 ... office. Imagine if you were just were a normal guy, you wouldn't have the amount of followers that you have.

Harry Stebbings 53:33 This, this is true. This is true. It's the short shorts that do it actually.

Shu Nyatta 53:37 Yeah, yeah.

Harry Stebbings 53:37 Yeah, yeah.

Shu Nyatta 53:37 They're in now though.

Harry Stebbings 53:38 Yeah, they're very in.

Harry Stebbings 53:39 My question is, sure, I think qu- uh, having the hard discussions is the most important thing. When you think about having the hard discussions as a partnership today, how do you have them? Often people say have them straightaway, it's the right time to do it when you feel it. How do you think about having the hard conversations between-

Marcelo Claure 53:56 I think it's personal. You know, we had a third partner.

Shu Nyatta 53:59 Yeah, we've had hard discussions already.

Marcelo Claure 54:00 And we, we are only two partners and we were three when we started. And it was those hard discussions that made us be two. And Stu and I have difficult discussions, but, but we, we learn to compromise, right? And I'm, I'm a tough, I'm, I'm a tough person. I- I-

Shu Nyatta 54:18 (laughs)

Marcelo Claure 54:18 ... usually like it my way, but I- I told you, I tell you that Stu and the other partners that we have have taught me that, hey, listen to others. And if they, they, lately they're changing my mind more often than ever before. And I think that's what partnership is all about. It's, you gotta bring your opinion, you gotta bring your boldness, you gotta bring... And at the end, compromise works in a marriage, compromise works in a partnership. Cro- And, and I think we're building, we're building a relationship of compromise where we respect each other's opinion-... i- incredibly well, even in our investment committee meetings where I might have a high level of conviction, but if my other partners don't, you know, I'm gonna retrench and in, and I've done the same. I've been able to convince them of things that at the beginning, they say, "No way." And I think that's- that's what is great. Like there's no, n- nobody's the owner of the truth in our firm.

Shu Nyatta 55:20 And, and back to the idea of following your gut that Marcelo mentioned earlier, I think you always know when a discussion is gonna be hard. Y- your body tells you, 'cause you don't wanna have it, and that's the strongest signal that that's exactly the conversation that should happen. So you have to, you have to go into the difficult places that your body is telling you you do not want to go to, whether it's discussing an investment or discussing something about the partnership. You're always getting these signals about what you should be focusing on, and that's what you tend to avoid, but it's a very strong indication that that's exactly what you should do. So you need a bit of courage just to listen to yourself and not be afraid to say whatever instinctively you feel is important without having a fight about it, which is the- the nuance.

Harry Stebbings 56:01 What was the most recent difficult discussion that you can remember?

Shu Nyatta 56:04 Well, it was about the partnership.

Harry Stebbings 56:06 Mm-hmm.

Shu Nyatta 56:06 So it wa- it was a difficult one to go from three to two, and it took a lot of time and lots of difficult discussions.

Harry Stebbings 56:12 Are we ready for a quick fire round?

Shu Nyatta 56:14 We are.

Harry Stebbings 56:14 Okay, let's do this. I say a short statement, you give me your immediate thoughts. We're gonna start with you, Marcelo. Let's do, what's the biggest challenge ahead do you think for you with Bicycle over the next 12 months?

Marcelo Claure 56:25 To convince the world that Latin America is a great place to do business in.

Harry Stebbings 56:30 Shu, what have you changed your mind on in the last year?

Shu Nyatta 56:34 I think, uh, peace is overrated.

Harry Stebbings 56:38 (laughs)

Shu Nyatta 56:39 So just being very practical, I think markets, big markets matter a lot. And I come from Kenya, right, which is a $50 million, uh, 50 million, uh, people population. If Kenya was 150 million people population, it would be a completely different story on the world stage. And so Kenya and Uganda and Rwanda and Burundi and Tanzania and Ethiopia just need to merge. We need more M&A between countries, and I think that's way more important than this idea of sovereignty that everyone's obsessed about. So, I think sovereignty is overrated. I shouldn't say peace is overrated, sovereignty is overrated, we need more country M&A.

Harry Stebbings 57:10 (laughs) Now that's a title. Marcelo, what's been your biggest lesson from working with Shu? How has working with Shu changed how you operate?

Marcelo Claure 57:18 He's more calm, he's more thoughtful. So I'm learning to-

Shu Nyatta 57:24 (laughs)

Marcelo Claure 57:24 ... t- uh, think a lot, you know, I'm, I'm a lot more thoughtful working with Shu than other people, because he has a strong opinion on things.

Shu Nyatta 57:32 Shu? The inverse. Uh, I've learned to respect the momentum and the instinct, and not to resist it, and to really channel all that energy in a productive way. So Marcelo brings a lot of really, really special stuff, and you can't get in the way of it, you have to channel it, so that notion of channeling.

Harry Stebbings 57:52 Marcelo, who are gonna be the biggest winners in venture in the next 10 years?

Marcelo Claure 57:57 Those that can help companies alter the course of their business in a positive manner, not those that can have access to deals.

Harry Stebbings 58:06 Shu, on the flip side, who are gonna be the biggest losers in venture in the next 10 years?

Shu Nyatta 58:12 Oh, it's easy to answer with the opposite of that.

Harry Stebbings 58:13 I know, isn't it? Sorry about that. (laughs)

Shu Nyatta 58:16 Passive beta capture, you know, this whole idea that you just buy an index of tech and you sit aside and let it perform, I think that's gone. I think you have to be a stock picker. And so people that are just trying to place a range of bets, I, I don't think that works. Even in things like AI, I think the, the surge into AI now, just we, we have to place a bunch of bets, I think that's wrong. I think you need to pick, just like if you placed a bunch of bets in search but you missed Google, it wouldn't have mattered. It was the right idea, but you really had to have picked Google, you had to have picked Amazon. So I think picking, those who resist picking and instead go for big trends, that will lose.

Harry Stebbings 58:53 (laughs) I-

Harry Stebbings 58:54 I do agree. If you could choose one board member, Marcelo, that you could have to sit on a board of your company, Bicycle, you name it, who would you have?

Marcelo Claure 59:02 Dead or alive?

Harry Stebbings 59:03 Dead or alive.

Marcelo Claure 59:04 Steve Jobs.

Harry Stebbings 59:05 (laughs) Why Steve, for you?

Marcelo Claure 59:08 He's probably the most intense individual I've ever met in my life.

Harry Stebbings 59:13 Take me through this. Sorry, I have to ask this. Take me through this meeting. How come the meeting with Steve Jobs came to be?

Marcelo Claure 59:19 So back then I used to own Brightstar.

Harry Stebbings 59:22 Mm-hmm.

Marcelo Claure 59:23 And I had an idea of how could Apple actually double their sales. And after many emails to Steve Jobs, which he wrote me back, "No interest, no interest." One day he got tired of everybody pinging him that he had to meet me, so he agreed to take a meeting, and that's how buyback and trading of mobile phones got invented. The whole idea of telcos make you sign it to your contract, Apple makes new technology every year, the only way you get people to actually get, uh, their technology every year is by buying back their old phones. And that's something that it took a very long time and some pretty intense meetings of somebody who absolutely seek perfection in everything that was done. And it was just fascinating to me to learn of how you never settle for less than 100%.

Harry Stebbings 1:00:17 I love that. That's a fantastic story. And-

Marcelo Claure 1:00:19 And that's how buyback and trading got in- got invented.

Harry Stebbings 1:00:23 I love that. I did not know that. Uh, Shu, again-

Shu Nyatta 1:00:26 Same question. Uh, I'm gonna pick Neil Shen.

Harry Stebbings 1:00:31 Ooh.

Shu Nyatta 1:00:33 He was a banker, he was a founder, he was an investor. He, he's an incredible investor. I mean, at Sequoia China, I don't even want to guess at the returns, but it's an, an absurd series of funds, you know, hall of fame series of funds. And he's managed to play this incredible role in the Chinese ecosystem, elevating the ecosystem and making great investments at the same time. I just think that wealth of knowledge and experience would be incredible.

Harry Stebbings 1:01:00 I totally agree. I think Neil is, uh, uh, awesome. So

Harry Stebbings 1:01:04 a line there. Uh, Marcelo, what's your biggest miss and how did it change your mindset as an investor?

Marcelo Claure 1:01:10 Probably NewBank. We didn't get there earlier on and we were stubborn. Uh, we were stubborn in evaluation and the founder was more stubborn-

Harry Stebbings 1:01:19 (laughs)

Marcelo Claure 1:01:19 ... and the founder won.

Harry Stebbings 1:01:20 (sighs)

Marcelo Claure 1:01:20 Uh, and I think now, you know, at the end, you know, I'm a huge personal investor into NewBank. I got SoftBank to be an investor into NewBank, but we were so new. I think it was our first week and we just said, "No, this is it," and we were wrong. So I always- I always (laughs) tell people- ... it's hard to say you're a great Latin American investor having missed NewBank at the beginning, and I say it publicly. And we bet on another horse and that horse didn't perform as well, you know, as NewBank did. So it's, uh, I mean, I've made lot- lot of bad investment decisions in my life, but that one bothers me because it's within my region, it's within my knowledge, and if there's one thing that I learned is st- don't be stubborn and I was very stubborn.

Harry Stebbings 1:02:02 I love that. The first week you're always gonna be disciplined.

Marcelo Claure 1:02:04 Exactly.

Harry Stebbings 1:02:05 Yeah.

Shu Nyatta 1:02:05 Yeah.

Marcelo Claure 1:02:06 Sure.

Shu Nyatta 1:02:06 Missing- missing the good ones is as bad as investing in the bad ones.

Harry Stebbings 1:02:09 Mm-hmm.

Shu Nyatta 1:02:10 Maybe worse. Um, I was gonna say NewBank, but now I can't. Probably OpenAI.

Harry Stebbings 1:02:18 Hmm.

Shu Nyatta 1:02:19 So when we were at SoftBank in 2017, I think thereabouts, Masa, correctly, was all over AI and, um, the team was small enough that we were all focused on the topic and looking around at what was interesting and being built in the world of AI. And we came across OpenAI, we knew OpenAI, we had discussions about OpenAI, and we just didn't do it. I think that was a huge miss, that would've been incredible. Um, and I think part of the fear was they're trying to build so much, and sometimes you have to build everything. Um, there are industries or markets that are thin protocol markets, meaning there's just not a lot of infrastructure and so the company has to do a lot of the work that's just not existing in the ecosystem. That's true in Latin America, by the way. A lot of industries in Latin America are thin protocol industries, there's just nothing and so a company has to do a lot, and often that turns investors off 'cause you say, "This is very operationally intensive or capital intensive," or what have you. But you need that to create the business and it's a business that's more likely to endure.

Marcelo Claure 1:03:16 Those are ones that we miss. I'll tell you one that we did, that was a terrible miss, and that was FDX. And I did that myself at SoftBank and it was one thing that probably taught me the best lesson ever-

Harry Stebbings 1:03:29 Oh fuck it, I've gotta ask this. How was the meeting with Sam?

Marcelo Claure 1:03:32 Do not e- uh, I don't even wanna tell you. But do not ever invest in things that you don't truly understand just because of FOMO. And I remember, it was one day before and Sam shared with me the list of old investors and I was very lucky, right? I had- I had a tremendous amount of decision range within SoftBank. You know, I'm- I can honestly say that my entire investment life, Masa never said no to any investment that I ever decided to do. And I went to Masa, I said, "Masa, I just cannot understand what am I missing? Why is everybody investing... Are we going to be the only idiots who are now going to invest in this?" And then Masa looked at me and said, "Your decision." So I invested $150 million on FDX, which, I mean, apologies to SoftBank because I should have never made that investment, but it's probably one decision that has changed my life forever. I'm never gonna invest in something that I don't truly understand, and I'm never gonna invest based on what everybody else is investing. And that's gonna be a great learning decision, that's gonna be a great learning lesson for me of to never break those rules, right? And- and I broke the golden rule because I didn't want to be the only guy left considering I was in charge of also doing crypto within or- or blockchain within the SoftBank ecosystem. Big miss, but a big lesson.

Harry Stebbings 1:04:54 Can I ask you a hard one which is, like-

Marcelo Claure 1:04:56 Yeah.

Harry Stebbings 1:04:56 ... you're a very bus- very busy man. To understand an industry, sometimes you have to study it. Uh, the big challenge that I have is I- I run media companies as well, we do a- a lot and our media teams are big now. I don't have time to study industries well enough to make an investment decision in a week. Do you? And if so, how do you do it?

Marcelo Claure 1:05:17 Just loo- we are lifelong learners, right? Like, I am bothered of my not so big knowledge within the AI ecosystem. So now I became a Harvard executive fellow and I'm in charge of- of one of the biggest lab, which is the Digital Cube, the D3 lab at- at Harvard, which is the AI lab at Harvard, and I work very closely to always be my- keep myself informed and you're able to leverage an incredible ecosystem of incredibly intelligent people, Harvard, and be able to bring that knowledge into what I do for everyday living. If not, it would be impossible for me to try to learn it all myself. So now I wouldn't consider my expert, but I have pretty good knowledge of what is going on in the AI world, and you always have to find clever ways to be that. I tried to do that within blockchain and it was so massive and people weren't sharing information and you were just investing in momentum, that- that is never gonna happen. I'm never ever gonna invest into something that I don't have a good level of understanding.

Shu Nyatta 1:06:25 And also Bitcoin go up. I mean... (laughs)

Marcelo Claure 1:06:28 No, now they say Bitcoin can go up to $100,000 again.

Shu Nyatta 1:06:30 (laughs)

Marcelo Claure 1:06:30 I don't know who- who... Uh, uh, very respected analyst.

Shu Nyatta 1:06:33 Bitcoin go up.

Harry Stebbings 1:06:34 I do find stature and success helps that learning though. Like, you can pick up the phone to-

Marcelo Claure 1:06:40 Sure.

Harry Stebbings 1:06:40 ... 99% of people in the world-

Marcelo Claure 1:06:42 Sure.

Harry Stebbings 1:06:42 ... 0.9% and you will learn from the best. When I'm looking at a FinTech deal, I'll call Miki Malka and say, "Help me understand."

Marcelo Claure 1:06:48 Yeah.

Harry Stebbings 1:06:48 And he teaches you. I do find that is why success really

Marcelo Claure 1:06:50 Is it amazing how highly successful people love to share?

Harry Stebbings 1:06:54 Yeah.

Marcelo Claure 1:06:55 Like, you know, I have the same thing. When I call Miki... And- and- and not only Miki, you can call, you know, successful people-... are actually hungry to share.

Harry Stebbings 1:07:03 Yeah.

Marcelo Claure 1:07:03 And, and you would think they wouldn't, but I mean, that's why they write books, that's why they get in podcasts, that's why they do these sort of crazy things. And, and, and, you, you know, that's, that's admirable of you that you're able to, that you actually call people to learn more.

Harry Stebbings 1:07:17 Oh, 100%. I also think cooling is a lost art.

Marcelo Claure 1:07:19 Yeah.

Harry Stebbings 1:07:20 Yeah. Uh, penultimate one. What would you most like to change about the world of venture?

Shu Nyatta 1:07:24 Speed. I think we've fetishized moving quickly and it's just not that valuable, um, especially at the growth stage. But I think even at the early stage, the whole idea that I have an exploding term sheet, it's gonna expire this Friday, first of all is nonsense. Term sheets don't expire. This is a made-up concept.

Harry Stebbings 1:07:41 (laughs)

Shu Nyatta 1:07:42 That, and the idea that you need to make a decision on limited information, you can't ask for anything else, those are cancers that came out of the zero interest rate regime. I think we just need to all calm down and make good decisions. It's better for founders if a process is s- a little slower. We're not talking about sclerotic, just a little slower, 'cause their company will be diagnosed in a little more depth, they'll learn something along the way. They won't think raising money is just snapping a finger. It's much better for investors. So speed, that FOMO-speed dynamic I think is a really awful trade adventure.

Harry Stebbings 1:08:14 Marcelo, what would yours be?

Marcelo Claure 1:08:16 I liked where we're going. I think the whole world got overly excited in the world of tech investing. You have crossover funds, you had corporations, you had everybody who suddenly became a tech investor, and a lot of people learned their lesson. And you have a lot of these funds who we all admire, who when you look at the true returns, are truly disastrous.

Harry Stebbings 1:08:42 (laughs)

Marcelo Claure 1:08:42 So I believe, and, and this is why I love my partnership with Shu, being an operator, you know how to operate business, you understand what it takes to scale, but there's an art of investing, right? So to me, operating is a science, investing is an art. If you can combine both, I think we're gonna have something really, really special. And that's, that's... And I think the venture world is starting to shape up where all these people who thought that, hey, let me just mark up a term sheet, li- limit, because I am betting that somebody's gonna come and six months later put a higher valuation and that's how we made our money. I mean, that was a Ponzi scheme. I mean, let's face it, now we're gonna see who actually got caught in that. So fun times ahead and a lot of things are gonna get uncovered and I think great investors are gonna thrive.

Harry Stebbings 1:09:36 Do you think so, though? Sorry, I'm just like, you know, fun lives mean that actually it's a very difficult business to die. It's generally very opaque. LPs bluntly, in a lot of cases, are quite lazy in their deployment. Um, we- we've been with them for years, they're quite nice people, they host a good AGM, yeah, we'll keep going. I- a lot of sins are covered. Do you think so-

Marcelo Claure 1:09:57 Yeah. I mean, I, I realize it's changing, and I love this, right? When you go to all these Middle Eastern conferences-

Harry Stebbings 1:10:04 Yeah.

Marcelo Claure 1:10:04 ... before, you used to see the top people of Silicon Valley raising money. Today, you see the great founders there, which is great.

Shu Nyatta 1:10:14 Going direct.

Marcelo Claure 1:10:15 Going direct.

Shu Nyatta 1:10:16 DT- not DTC, DTF.

Marcelo Claure 1:10:18 Yeah.

Shu Nyatta 1:10:19 All the LPs are going direct to founder.

Marcelo Claure 1:10:21 Which is, which I think is good because there's gonna be only very few funds that actually create value that are gonna be able to raise money. And I'm talking the next 10 years. But, you know, the source of capital is getting incredibly smarter on an accelerated pace in terms of going after the best companies. And the best companies know that in many cases, you can skip intermediaries. And when you have so many intermediaries, right? I believe that the best will survive and the best will thrive, and that's what we're betting on.

Shu Nyatta 1:10:53 And you're seeing really aggressive fund size targets not being met in real time. I'm not gonna name them-

Harry Stebbings 1:11:01 Sure.

Shu Nyatta 1:11:01 ... but we've all seen the news, like 90% below what they thought they would get. So it is changing. I mean, the, the funds do have long lives and they'll, they'll last, the tail will be long, but I think we're past the excesses.

Harry Stebbings 1:11:14 Yeah, I, I, I totally agree with you. And I love the DTF. I've never heard that before.

Shu Nyatta 1:11:18 Right.

Harry Stebbings 1:11:19 Um, I also find it quite-

Shu Nyatta 1:11:21 Expired in the moment

Narrator 1:11:21 (laughs)

Harry Stebbings 1:11:22 ... right here. I also find it quite interesting the way that, um, quite a lot of people took a moral high ground around raising from the UAE and now it's like everyone is there continuously. It's amazing how morals change. Uh, my f-

Shu Nyatta 1:11:33 Well, but, but t- so to be clear, not all Middle Eastern money is the same, right?

Harry Stebbings 1:11:38 Totally.

Shu Nyatta 1:11:38 UAE has not had-

Harry Stebbings 1:11:40 I think Silicon Valley told her just the same, no?

Shu Nyatta 1:11:42 Yeah, but that's another example of misunderstanding-

Harry Stebbings 1:11:45 A region.

Shu Nyatta 1:11:47 ... putting regions in one bucket. Latin America is this, the Middle East is this.

Harry Stebbings 1:11:52 Final one. When we think about next five years for you and for Bicycle, in a dream scenario, if everything goes to plan, like we asked founders, what could this be? If I ask you what could Bicycle be, what would your answer be in a dream scenario over a five-year period or a ten-year period? Five years isn't too long.

Shu Nyatta 1:12:10 T- ten, not five?

Harry Stebbings 1:12:11 Let's do ten.

Shu Nyatta 1:12:13 Um, a, a high-quality firm whose decisions mean something to the rest of the ecosystem, whether it's founders or LPs or investors. If we make an investment, it means something.

Marcelo Claure 1:12:28 I want to be what Sequoia China is to Chinese entrepreneurs. I've had a chance to visit China. And the gold standard today is when you're part of the Sequoia China ecosystem. And we make no mistake, you know, we went to visit Neil with Shu, we spent time with him, we spent a lot of time with the entrepreneurs, and we asked them, like, "What's a, what's a great fund for you?" And 99% of them, the best ones basically listed Sequoia China, and they gave us the list of services. So we have a very deep alliance with Sequoia China, and .......................... Sequoia China with Neil Shen. And I like Neil a lot and I respect him and I think, you know, I want, we want to build something that is similar to that. I wanna make sure we're relevant. I wanna make sure that, that we don't miss the new banks. We wanna make sure that in every single great company that is built in Latin America, we have had a role to play, either in the beginning, in the middle, or towards the end. And I think we have that opportunity because not a lot of people are in Latin America today.

Harry Stebbings 1:13:36 I can't thank you enough, both of you, for coming on the show. Honestly, I've loved this. It, it's shows like this where you realize why I- you're so lucky to do what you do, for me in particular. So thank you so much for this, and I cannot wait to see you build Bicycle.

Marcelo Claure 1:13:47 Thank you.

Shu Nyatta 1:13:48 Thank you.