20VC: Homebrew's Hunter Walk and Satya Patel on Why $100M is Not Enough To Execute a Seed Strategy Today | Why They Decided not to Raise New External Funds | Where Are We in the Cycle & What is Truly F***** | Why Founders Should Take Secondaries Earlier
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
Investment Strategies: The Buyer vs. Seller Dilemma
This chapter examines the key factors that investors must consider when deciding to buy or sell their stakes in companies. It highlights the significance of risk-adjusted returns, the alignment of interests between partners, and how past experiences shape ongoing investment strategies.
00:00
Transcript
Play full episode
Transcript
Episode notes
Speaker 2
Yeah, that's the last question I'll have. I could spend the whole time on questions on this. I think it's very interesting. Generally speaking, there's always exceptions. You started off in a boiler room, right? And I think so many revenue leaders, I know that are good at outbound, started off door to door in a boiler room with the other pages. Generally speaking, if founders are trying to make a bet, generally speaking, can you learn it late in life? Learn outbound. That's a good question. If you've grown up and you've been great at wherever, I would say, I'm early in an inbound model. Can you learn it as your first VP of sales of zero gig or is it almost hopeless?
Speaker 1
I wouldn't say hopeless, but I would say it's not very likely. If you want to run an outbound model and you've got a VP of sales who has been in 80% inbound models, it is because for them to be, for that person to really grok outbound, you have to do it. And I know you've talked a lot about VPs of sales not wanting to get in front of customers and they're afraid to go and pitch. I'm very strong agreement on that. And so they're not going to pick up the phone, make cold calls. They're not going to figure it out themselves. So I never say never, but I just hired a VP of sales whose first job was door knocking, selling solar at Tesla Solar Cities. I like those ones. I'm a believer. Yeah. Yeah, you'll like Brett.
Speaker 2
All right. Let's have other questions and thanks for those inside. Yeah.
Speaker 1
Yeah. Thanks Jason. Thank you, Jason. That covered a lot of the questions actually. Thank you so much. Great. Great week this week. Great content, great interactions. So thanks everyone for joining. And of course, a big thank you to Kyle for sharing all of this. Thank you, Kyle. Thanks for having me.
Speaker 2
This episode is sponsored by our friends at Pendo, the all-in-one product experience platform. Pendo helps your users do things you really want them to do. You can try Pendo for free at pendo.io slash Saster. That's pendo.io slash Saster. And check out Mind the product, their community for product people like us. Our international payroll regulations giving you a headache. Remote.com is your solution. With our best in class interface and expertise, we consolidate payroll for your employees, whether in one country or a hundred. Trust Remote.com was swift to secure payments for your team while you focus on scaling markets and driving business growth. Get more when Northwest Registered Agents starts your business. They'll form your company fast and stand up your entire business identity in minutes. That means business-free domain, business email, website hosting, address, mail scanning, business phone app all within minutes. Visit northwestregisteredagent.com slash Saster to start your
Speaker 1
business today.
Hunter Walk and Satya Patel are Co-Founders and Partners @ Homebrew, one of the leading seed funds of the last decade. Following 10 years of stellar returns with investments in the likes of Chime, Plaid, Gusto and many others, they decided to not accept any further LP capital and to only invest their own money moving forward through Homebrew Forever.
In Today's Discussion on Homebrew We Breakdown:
1. ) The Foundings of a Great Partnership:
- What was the moment when Hunter and Satya decided they were going to go out and raise their first fund with Homebrew I?
- What are the core principles that all founding partners need to align on before they start a firm together? What questions should they ask of each other?
- Why does being independently wealthy coming into a partnership make the partnership easier and more efficient to operate? What changes when the partners have money already?
2.) What Changes When Moving From LP Dollars to Personal Capital:
- Why did Hunter and Satya decide to not raise any further capital from external LPs?
- Asset allocation-wise, how did they determine how much is the right amount to set aside for the first 2 years of investing? How many investments do they want to make with that cash?
- How does investing their personal capital change their deployment pace and cadence?
- How does it change their approach to reserves management and follow-on financing?
- How does it change their approach to pricing? How price sensitive are they today?
3.) Analyzing the Seed Landscape Today:
- Why do Hunter and Satya not think that a $100M seed fund is enough to properly execute a world-class seed strategy today?
- Who is their competition with the new strategy? How does it change their relationship with large multi-stage funds? How does it change their relationship with seed funds?
- Do they agree that the last generation of sub $20M micro-funds will not raise another fund in this cycle? How did their entrance impact the seed landscape over the last few years?
- Why are LPs also to blame for many of the original seed managers raising larger and larger funds?
4.) Companies: Money and People are The Problem:
- Why has too much money been such a problem for many Homebrew portfolio companies over the last few years? How has too much money changed their execution plans?
- What happens to the "living dead" companies with many years of runway but no product market fit?
- Who does this market cater to well? Who will thrive in this market?
- What have people forgotten about both startups and venture in the last 2 years that we have to remember?
- Why is this generation so entitled and expectant? Why are startups not a get-rich-quick scheme?
Remember Everything You Learn from Podcasts
Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
