In this episode of Turpentine VC, Erik Torenberg interviews Lauren Farleigh and Zach Perret from Mischief VC, discussing their experiences as founders and how they leveraged those to build their venture firm.
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LINKS:
Mischief VC: https://www.mischief.vc/
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X / TWITTER:
@zachperret
@LFarleigh
@TurpentineVC
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HIGHLIGHTS FROM THE EPISODE:
- Lauren Farleigh and Zach Perret from Mischief VC leverage their founder experiences (Zach is CEO of Plaid, Lauren founded Dote Shopping) to build a differentiated VC firm.
- Mischief started with a $30M fund one and grew to an $80M fund two, focusing on early-stage investments.
- Both started angel investing in 2017 and saw a market opportunity to institutionalize their approach based on founder-to-founder support.
- They identified a gap: few VCs have true zero-to-one, finding product-market fit experience.
- Zach shares how early angel investors who were former founders helped Plaid at critical moments, inspiring Mischief's model.
- They're a generalist fund investing in software companies, more founder-driven than thesis-driven, with $1-4M checks.
- Their approach is hyper people-driven: they follow the best people in their network rather than doing outbound sourcing.
- They host structured dinners with 10-12 people, asking attendees to recommend others, effectively building their network.
- Send quarterly updates to portfolio companies like a monthly company update, keeping founders engaged.
- Transitioned from participating to leading rounds after a portfolio founder wished they had led his successful round.
- They track potential founders before they start companies, building long-term relationships.
- Play a "ground game" focused on delivering results rather than being loud on social media.
- Fund two fundraising was harder than fund one due to market conditions and larger size.
- Zach is part-time at Mischief while running Plaid, focusing on sourcing and unique situations where he has relevant experience.
- Having four GPs provides the right level of availability while allowing each to focus on their strengths.
- Fund two has primarily first check focus with aggressive recycling, avoiding follow-ons that dilute returns.
- Currently feel capital constrained with four GPs on $80M, planning careful growth while maintaining responsible investment practices.
- Focus on building training modules for common founder challenges like recruiting and sales, not on firm marketing.
- Most founders struggle with fear/indecision in cold sourcing rather than making mistakes; Zach advocates direct outreach.
