EO Venture DifferentlyㅣAltos Ventures, Tae Yoon | EO
Jul 2, 2025
Tae Yoon, a Partner at Altos Ventures, shares his insights on navigating the venture capital landscape with a focus on long-term success. He reflects on lessons from the DotCom crash and emphasizes the importance of capital efficiency for software ventures. Tae introduces the unique idea of 'hedgehog' founders—those who maintain a singular focus on their vision. He also discusses the dynamics of partnerships in startup growth, likening venture capitalists to preschool teachers, highlighting the necessity of mutual respect for fostering innovation.
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Core Investment Principles
- Jack McDonald's teachings centered on power law, compounding, and the hedgehog concept shaped Altos Ventures' investment philosophy.
- Altos believes a few companies drive all returns, value compounds over many years, and founders should deeply focus on one problem.
Dotcom Crash Lesson
- Altos' initial approach was to prepare startups and pass them to large VCs who marked up valuations pre-IPO.
- The dotcom crash proved this flawed as companies went to zero, prompting Altos to rethink value creation.
Power Law and Patience
- In venture capital, most returns come from very few companies, and value compounds significantly in later years.
- Altos adopts a patient, long-term view, investing in companies like Roblox over decades to harness this compounding effect.