3min chapter

This Week in Startups cover image

Sahil Lavingia on Gumroad’s groundbreaking equity crowdfunding raise, lessons from a decade-long startup journey, insights on rolling funds & more | E1188

This Week in Startups

CHAPTER

Acne Ventures

Seel: The risk is just too high by default, that they basically will only do it for people they've known for twenty years. Seel: If you're some giant school's endowment and you say no to cliners, you know, sixth new fund in your mind,. thit's what they've told me, at least i'll take cliner out of it. So essentially, these giant funds have taken all the air out of the room with that set of lps which then leads us to be independent of them.

00:00
Speaker 2
Yes, i think i know est crowsand cons but it's, i'm hopeful that, you know, i have no institutional pies in my fund, and i don't think i would be able to get them liked they would have, as you mentioned, they would look at me and be like, come back in fifteen years, you know, yei trust me. And so i just think they don't get it, or they don't, you know, it's ust the risk, like, the risk is just too high by default, just like thee commitment that they intend to make, that they basically will only do it for people they've known for, like, twenty years. They went to school with, which inherently eads actually homogeneous
Speaker 1
community. Yet its pretty homogenous. I think it's actually nless pernicious than that. It's actually that they have a committee they go to. They can add but one, two, three funds a year. And the existing funds, let's say the, you know, really bluchi funds like a cliner. You've seen them do bigger and bigger funds. You've seen them do a, you know, a scout seed series, a growth opportunity, secondary share crypto. They'd all of a sudden come up with ten different fund ideas. If you're some giant school's endowment and you say no to cliners, you know, sixth new fund in your mind, thit's what they've told me, at least i'll take cliner out of it. Acne ventures, you know, so delta university has got a relationship with acme ventures. Acne tures comes up with four new products, and the, the firm, the, the the endowment doesn't participate, they lose access to the ones they were in originally. So now they're just getting squeezed by, you know, in trec and horro hat. Sounds like fifteen funds in ten years. And so what i've heard from them is like, we have to be in the next indres and fund, or else they won't let us in the other ones. Therefore, there's no room for new fund manager. So essentially, these giant funds have taken all the air out of the room with that set of lps, which then leads us to be independent of them. So this is their big mistake. Someone like you is going to make their own way in the world, or me with my syndicate. And by the time one of those big funds wants to participate, seel, we don't need you. And that's what i told them last time i went on the touros, like, ah, you realize they'r probably not going to need you any more, because if syndicate goes from two thousand to four thousand people, i'll have escape velocity. And now it's seven thousand people. So it's like, you
Speaker 2
don't need em
Speaker 1
exactly. This new, this new democratization that we're talking about here, both from crowd funding and from rolling funds and from syndicates, is just crazy. A do you tell them what you're investing in every quarter? Do you give them a quarterly report? How do you communicate to the rolling fund l p is what you're doing, or do they even care? Most of them don't care
Speaker 2
too much.

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