The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

20VC: a16z's Scott Kupor on The Biggest Learnings From Scaling a16z from $300m to $7Bn AUM, The Biggest Mistakes Entrepreneurs Make When Pitching VCs & Why VC Is Simply A Customer Service Business

Jun 10, 2019

Scott Kupor, Managing Partner at Andreessen Horowitz, shares insights from overseeing the transformation of the firm from $300 million to over $7 billion AUM. He discusses major mistakes entrepreneurs make when pitching VCs, emphasizing the importance of market and team over product. Scott also reflects on lessons from the tech boom and bust, highlighting how public market conditions have changed. He shares thoughts on building strong relationships with VCs and the significance of unit economics in scaling businesses.

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ANECDOTE

From Banking to Tech

Scott Kupor transitioned from investment banking to the tech world after a chance encounter.
He joined LoudCloud, Mark Andreessen and Ben Horowitz's company, in 2000.

INSIGHT

Lessons from the Bust

Experiencing the dot-com boom and bust taught Scott Kupor valuable lessons about evaluating businesses.
It emphasized the importance of sound unit economics, strong competitive moats, and sustainable scaling strategies.

INSIGHT

Today vs. Dot-Com Bubble

The current market differs significantly from the dot-com bubble due to increased company maturity and market size.
Companies going public now have substantially higher revenues and the internet user base has exploded.

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Scott Kupor is Managing Partner @ Andreessen Horowitz, one of the world's most renowned venture funds with a portfolio including the likes of Facebook, Airbnb, Github, Lyft, Coinbase, Slack and many more. As for Scott, he has been with the firm since its inception in 2009 and has overseen its rapid growth, from three employees to 150+ and from $300 million in assets under management to more than $7 billion today. Before a16z, Scott was a VP @ HP where he managed a $1.5 billion (1,300 person) global support organization for HP Software product portfolio. Scott joined HP as a result of his prior company Opsware, being acquired, where he served as a Senior VP across numerous roles across an incredible 8-year journey.

In Today’s Episode You Will Learn:

1.) How Scott made his way from the world of law to startups to being Managing Partner at one of the world's most renowned venture firms in the form of a16z?

2.) How did seeing the boom and bust of the dot com bubble and 2008 impact Scott's operating mindset today? Why does he argue that those times are so drastically different to today? How do public markets fundamentally diffferent? How do teams approach to capital efficiency and scaling differ significantly?

3.) What does Scott believe entrepreneurs get most wrong when pitching VCs? Why does Scott argue that product is not the core when pitching VCs? Does Scott agree with Fred @ Okta in weighing it: 70% market, 20% team, 10% product? What is Scott's weighting? Why does Scott believe that the compression of fundraising timelines is a problem? What pitch sticks out to Scott above all others? What made it so memorable?

4.) How does Scott advise founders on determining the right amount to raise for? Does Scott believe that founders should ask for a specific number or a range? Why does Scott believe raising for "runway" is the wrong mindset? Does Scott believe that most bridges are bridges to nowhere? If so, what is the next step? How does one relay that information to the founders?

5.) What have been some of Scott's biggest learnings from building the firm with Marc and Ben? What does Scott believe have been the biggest inflexion points in the public status of a16z? What have been the biggest challenges for Scott in the scaling of the firm? How does he foresee that changing in the future?

Items Mentioned In Today’s Show:

Scott’s Fave Book: Master of the Senate: The Years of Lyndon Johnson

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