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

I think you wanna invest in people that can materialize labor, capital, and customers. We either wanna buy any percent, any percent, right, of something that is absolutely working, or high ownership of something that could work.

$15 billion. That is how much Andreessen Horowitz just raised. Today, I'm joined by Alex Rampell, where he leads their $1.7 billion apps fund.

The best companies have hostages, not customers. In 2025, the ability to go create a software product is so easy. This can take weeks, which is bonkers. The battle of every startup versus incumbent is whether the startup gets the distribution before the incumbent gets the innovation, right? So probably of the unicorn class, I would bet that maybe 5% will ever be able to go public. If you win 100% of the deals, that's a very, very good sign, but if you're winning them with very low ownership, you're probably not testing how far you can go. The entire job of venture capital is to find, pick, and win investments. If they're good investments, the winning is very, very hard. We are buying out-of-the-money call options, and we hope they expire in-the-money. I don't necessarily think you can take it as a given that a small fund will outperform a large fund. Ready to go? [upbeat music]

Alex, dude, it's been eight years. I'm hoping that my question-asking ability has gone up in terms of quality in those eight years. Now, listen, I wanna start: $15 billion you raised today, and I was just looking at that, and I was wondering, in an age of venture today, do you have to go really big or go crafts and very small and boutique to win in venture today?

Yeah, I mean, I think th- this is, um, uh, this sounds like a bad word when I say death, but there is this kind of death of the middle that happens to a lot of asset classes in general. In venture capital, it was a tiny, tiny asset class at the beginning. Um, right now, it's gotten bigger, but it's really more of the end state of a lot of these companies is huge. I mean, Sequoia used to brag about, I think it was like 20% of the market cap of the NASDAQ was Sequoia companies. Millions of pe- like, you know, Apple and Oracle and all of these, these amazing names. Um, they're very, very big, right? And companies go public much, much later today, so the ability to deploy more capital, more money into kind of venture capital, which is no longer, um... You know, kind of si- sidetrack here. Series D didn't exist in, like, 1992, right? It's like that was an IPO. Like, companies would go public. I think Amazon went public at, like, a $600 million market cap or something. Like, that was the norm. There was no Series I, Series K, Series, you know, W. You would just go pub- you'd raise, you know, Series A, raise Series B, raise Series C, then go public. Um, and consequently, venture firms back then were very, very small, but also the exits tended to be quite small as well. Right, like, if, if, if a very, very good scenario is you have a company that goes public at a sub-billion dollar market cap, it's like... And you get five of those a year, like, you, you can't raise lots of money, but now the opportunity is so much bigger. The five biggest companies on Earth are all technology companies. If you rewind 20 years, I think they were all banks. If you rewind 10 years before that, they were all oil companies. If you ri- rewind 10 years before that, they were all Japanese companies during, like, the Japanese stock market bubble. But, you know, the opportunity in technology is so much bigger, especially because these companies, you, you can- you could keep investing venture capital dollars later. Like, I think that's one of the main... If you look at the money that we just raised, you know, almost $7 billion of that is for the growth fund. And what is-