Jason Lemkin: Every VC has a FRAUD in their portfolio; The IPO market is about to EXPLODE | E1046

I'm not saying we're bouncing to 2021. It's gonna take 20 years to experience that moment again. It will happen again. It's every 20 years, right? But 2024 will be rich with IPOs and it will be a good year with solid multiples, solid multiples.

Jason, I am so excited for this. I always so enjoy our chat, so thank you so much for joining me today, my friend.

Thanks, uh, thanks for having me back, Harry. It's always a pleasure.

Now, you know the normal start of that how did you get into venture malarkey, I wanted to start with if you could call yourself up the night before you started as a venture investor and give yourself a piece or two of advice, what advice would you give yourself knowing all you do now?

Yeah, well, the first... It's an interesting question. The first one I tell everyone that's a new manager, especially anyone abo- above the analyst level, and what I was told when I w- went into venture, and I think, I think you might have been told the same thing, was, "Don't worry about doing a deal your first year." Don't worry about doing a deal... I'm not talking about an angel check for f- 10K or 15K. I'm talking about don't worry about writing an enormous check and... This is what the traditional GPs tell you, because the last thing they want you to do is to meet with 28 pretty good companies and burn the fund, right? They know how rare the outliers are, right? And so this is the advice I got, "Don't invest your first year." And I did five real unicorns in my first 13 months, right? I did Pipedrive, which exited for, like, 1.25 billion, and then Algolia was my second. That's worth 2.5 billion. It will IPO next year. I did Talkdesk worth 10 billion. I did, um, Parklet Greenhouse, which will IPO next year. They're at 200 million, and I did SalesLoft, which sold for two and a half billion of cash. Um, those were my first five deals. And it's interesting how it happened, but I tell everyone, "If you have something, if you have a hot hand, if you have a brand, like, like, a 20 VC or anything behind you, or a great network, if you came out of Datadog or Stripe or wherever, MongoDB, and you have a network, go do those deals." Like, you may not know venture, but that's what the other guys are for, right? They will teach you ownership. They will teach you some discretion to some extent, but, um, leverage it. And I, and I am... It's interesting how many great VCs had a great investment their first six or 12 months. The first friend I had that became a VC was David Hornik, right, who's now at Lobby, was at August, and he tells a story how this first deal he, like, blew 10 million, which back in the day was, like, a career-ender, right, as a kid going into venture, but his second was Splunk. I think his second one was PayCycle, which then he did Bill, right, which was Rene's second one. So the first one exited for 100, the second one's worth 20 billion, I think Splunk was his third, and he did those all the first year in a downturn, in a massive downturn. And, and I, the more... I mean, you talked a lot more VCs than I can, but I wou- I wouldn't be surprised if a lot of the best VCs had a few, at least one big winner their first 12 months, and so that canonical advice is great for the fund. Trust me, it's great for the fund. Don't blow it all, kid, right? Just because you are a, a SVP of, uh, engineering at New Relic does not mean you know how to find a great seed investment. That is true, but... So th- and I tell it to everybody and I say to them also because, "E- e- even if it's not perfect for the fund, it's great for you to get into a winner your first year. That winner lasts forever." The great thing about venture is your w- your winners last, you can talk about them for a decade. You can literally... And so the earlier you get a winner, and a winner really being, like, the, the person on the board, the first investor, like an iconic winner where the founders will back you, the earlier you get in your career, you could probably raise three funds on the back of that, even if they, all the rest of your investments are dogs, right? So you only live once, so that's the main advice. That's the number one which we get to give you, and the second one is the opposite, which is, I tell folks, um, "U- unless you're starting your own fund really from scratch," right? Um, and even you didn't do that, Harry. You, you had a stint a- at another fund, right, before you started.