Villi Iltchev is the founder of Category Ventures, where he invests early in enterprise software startups. And he’s done it longer than almost anyone, building Salesforce’s corporate venture arm and investing early in companies like Airtable, Zapier, GitLab, Remote, Hubspot, Gusto, and Box.

Fresh off raising his $160m Fund 1, we get into the opportunity he saw to start Category, and how San Francisco and Silicon Valley have changed over the past 30 years.

He also shares his story growing up as an illegal immigrant in Greece, moving to the US by himself in high school, the biggest mistake of his career, advice for founders selling their company, why unit economics and profitability always matters, how developer tools went from terrible to amazing businesses, the mistake that almost killed GitLab after he invested, and why you should raise your seed round from a seed fund.

Timestamps:

(00:00) Intro

(03:22) Illegally immigrating from Bulgaria to Greece

(05:14) Moving to the US by himself in high school

(13:15) Moving to SF in the Dot Com Bubble

(15:49) How SF changed over the last 25 years

(22:27) Why HP fell from the top of Silicon Valley

(25:36) Building Salesforce’s corporate VC arm

(30:29) Why SaaS was so transformative

(34:35) Angel investing in Airtable

(39:52) The biggest mistake of his career

(42:13) Why unit economics always matter

(47:20) Biggest mistake when selling a tech company

(49:00) Almost starting a software PE firm and landing in VC

(55:45) Lessons from August Capital + Evolution of venture

(59:22) Early days of dev tools + Investing in GitLab

(1:09:50) Why being contrarian is dumb

(1:11:45) How GitLab almost died and emerged stronger

(1:16:48) Villi’s journey to starting Category

(1:25:22) Category’s thesis

(1:30:48) Why startups always come in batches

(1:31:57) The importance of track record in venture

(1:35:32) Deciding a $160m fund size

(1:39:26) Why you should raise seed rounds from seed firms

(1:43:40) What Villi looks for in a startup

Referenced

Category VC: https://www.categoryvc.com/

Category’s $160m Fund 1: https://www.forbes.com/sites/alexkonrad/2024/12/17/villi-iltchev-raises-160-million-debut-fund-category/

Aaron Levie (Box) on The Peel: https://youtu.be/cLn_tqPvNf4

GitLab’s Recovery Stream: https://www.youtube.com/watch?v=v0TRHLvYGE0

Guy Podjarny (Snyk) on The Peel: https://youtu.be/BzKlZ_v4uCw

Why SaaS won’t consolidate: https://medium.com/@villispeaks/why-saas-consolidation-is-not-happening-2b9b722e0250

Follow Villi

Twitter: https://x.com/villi

LinkedIn: https://www.linkedin.com/in/villi04/

Follow Turner

Twitter: https://twitter.com/TurnerNovak

LinkedIn: https://www.linkedin.com/in/turnernovak

Subscribe to my newsletter to get every episode + the transcript in your inbox every week: https://www.thespl.it/