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

20VC Roundtable: Is the VC Model Broken? The Biggest Disconnect Ever Between TVPI & DPI, Why Market Size is Dangerous, Why "Go Fast" is Terrible Advice, The Dangers of Raising Large Rounds at High Prices & Why Next Year Will See the Biggest Hiring Spree i

Sep 20, 2023

Join Eric Paley, Managing Partner at Founder Collective, Mike Maples, Co-founder of Floodgate, and Jason Lemkin, Founder of SaaStr, as they dive into the changing venture capital landscape. They discuss why high startup valuations can be perilous, the pitfalls of following 'go fast' advice, and the significant risks for founders raising at inflated prices. With insights on market inefficiencies and strategic decision-making, they challenge the status quo, questioning if the seed model is still viable in today's market.

01:17:36

Creator website

Episode guests

Jason Lemkin

Mike Maples, Jr

Eric Paley

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Podcast summary created with Snipd AI

Quick takeaways

Outliers in the startup world usually start at a low price because they are non-consensus and unique ideas.

Focusing solely on ownership is problematic and can hinder collaboration with other investors.

Being overpriced at the seed stage can be a bigger problem than most entrepreneurs realize, as it can make raising follow-on funding more difficult.

Venture capital is not about short-term gains but rather a long-term journey with portfolio companies.

Deep dives

Outliers start at a low price

Outliers in the startup world usually start at a low price because they are non-consensus and unique ideas.

The Risks to Venture Back Companies

01:24

Investing in Startups with Long-Term Potential vs Short-Term Incentives

01:40

The Role of Outliers in Seed Investing

01:28

Maples: Non-Consensus Startups tend to be underpriced

01:57

Intro

5min

Navigating the Challenges of Startup Valuations

3min

Exploring Non-Consensus Investment Opportunities in Cloud Computing

2min

Navigating Venture Capital Trends

9min

Exploring the Risks of the AI Valuation Bubble

2min

Navigating Startup Decision-Making

9min

Navigating Investment Dynamics in Competitive Markets

17min

Navigating Unicorn Valuations

15min

Navigating Venture Capital Dynamics

16min

10.

Innovative Tools for Startups and Business Growth

3min

Eric Paley is the Managing Partner at Founder Collective, one of the world’s most successful seed funds with investments in the likes of Uber, The Trade Desk, Coupang and Airtable.

Mike Maples is one of the OGs of seed investing. As the Co-Founder of Floodgate, he has backed the likes of Twitch, Okta, Lyft, Twitter and more.

Jason Lemkin is the Founder @ SaaStr one of the best-performing early-stage venture funds with a portfolio including Algolia, Pipedrive, Salesloft, TalkDesk, and RevenueCat to name a few.

In Today's Episode on Is the Venture Model Broken? :

Is the classic seed model dead? Can seed funds play in a world of $25M valuations?
Why is having a firm grasp of the present the best thing an early-stage investor can have?
Why does Mike Maples believe no company with true product-market-fit has ever failed?
Why does Eric Paley believe "go faster" is the worst startup advice?
Why does Mike Maples believe there is a direct relationship between price and risk?
Why does Mike Maples believe that outliers by their very nature are lower priced?
Why does Eric Paley not focus on ownership? Why can it be dangerous?
What are the biggest risks for founders raising at valuations that are too high?
Why does Eric Paley believe we will have the biggest chasm between TVPI and DPI in the prior vintage of venture capital returns?
Why does Eric believe the majority of SPACs were BS and great companies can always go public?
Why does Jason believe that if multiples do not reflate, the venture model is broken?
Why does Jason believe we will see the biggest hiring spree in tech next year?
How has illiquidity allowed Eric Paley to make some of the best investment decisions?
What is Mike Maples biggest lesson from selling Twitter stock early at $1BN?

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