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20VC: NEA's Scott Sandell on SPACS and Why Liquidity is One of the Challenges of our Time, Why We Are At An Inflection Point For Secondaries & Why There Is Nothing To Suggest The Boom Will Not Continue

Mar 11, 2021

In this discussion, Scott Sandell, Managing General Partner at NEA, shares insights from nearly three decades in venture capital. He delves into the evolving landscape influenced by market fluctuations and the recent boom, highlighting liquidity as a pressing challenge. Scott emphasizes the transformative impact of technology on company growth and scaling. He also reflects on trust in investment partnerships, advocating for smaller, cohesive teams for better decision-making and collaboration. Personal values in investing and lessons from literature further enrich the conversation.

37:35

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Episode guests

Scott Sandell

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Episode notes

Intro

3min

Navigating the Early Days of Venture Capital

2min

Influences of Family Legacy and the Internet's Transformative Impact

2min

Navigating the Evolving Venture Capital Landscape

15min

Navigating Trust and Decision-Making in Investment Partnerships

10min

Literature and Life Lessons

3min

Investment Insights and Market Reflections

3min

Scott Sandell is the Managing General Partner of NEA, one of the leading firms of the last 3 decades with now close to $24Bn under management and a portfolio including the likes of Salesforce, Robinhood, Plaid, Databricks and many more incredible companies. As for Scott, since joining the firm in 1996 he has led investments in many industry-transforming technology companies including Salesforce.com, Tableau Software, WebEx and Workday. Scott also serves on the board of rocketships including Robinhood, Cloudflare, Coursera and Divvy to name a few. As a result of this investing success, Scott is among the most frequently named venture capitalists to the Forbes Midas List.

In Today’s Episode You Will Learn:

1.) How Scott made his way into the world of venture close to 3 decades ago back in 1996? How he came to be Managing General Partner of NEA today? What is entailed in the role of "Managing General Partner"?

2.) What has been the single biggest change in the venture landscape that Scott has observed since his entering in 1996? How did the boom and bust of the dot com and 2008 impact his investing mindset? Consequently, how does Scott advise founders to think about capital efficiency and business model flexibility? What concerns Scott today?

3.) Why does Scott believe "this is an incredible moment in history for the asset class of venture"? How does Scott think about the core physics of company building changing? How is it companies are able to scale and grow so much faster today? Does their speed of growth change their capital requirements?

4.) Does Scott agree with Bill Gurley, "the biggest challenge is the oversupply of capital today"? How does Scott analyse his own relationship to price and price sensitivity? What is Scott's framework for determining when to pay up vs when to remain disciplined? How does Scott feel about the rise of SPACs? How will this shake out over the coming years?

5.) How much have NEA companies raised over the last decade? Of that, how much did NEA invest? Is the answer to continuously scale AUM? How does NEA approach investment decision-making with the size of partnership it has? What does Scott mean when he says, "we vote on the process"? How do you create a partnership of trust at scale?

Item’s Mentioned In Today’s Episode

Scott's Favourite Book: The Old Man and the Sea

Scott’s Most Recent Investment: Loanpal

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