Venture Unlocked: The playbook for venture capital managers

Mitchell Green of Lead Edge Capital discusses the Moneyball approach to investing, effective cold calling, and managing 700+ strategic LPs. The podcast highlights the firm's unique model combining PE and growth strategies, emphasizing strategic evaluations and LP relationships. The episode explores the value of being a contrarian investor and embracing risk in the venture capital landscape.

The podcast discusses LP perspectives on early-stage and late VC, the role of venture in private portfolios, challenges faced by unicorn companies in maintaining high valuations, impact of crossover funds on growth markets, and insights on market dynamics and investment strategies in venture capital.

Samir Kaul from Khosla Ventures discusses investing across cycles, market insanity pre-2022, and building a firm. They talk about their focus on technology-heavy investments, capital abundance, the potential of the AI super cycle, and non-consensus decision making in venture capital. They reflect on their quarter-century career and share advice on focusing on high-growth companies.

Aileen Lee of Cowboy Ventures discusses the rise of unicorns and the evolution of capital efficiency. She explores the role of experienced venture capitalists in rising tide markets and the importance of understanding business models. They also discuss the current state of venture capital funding and trends.

Venture capital has gone mainstream and shows parallels to private equity and hedge funds. The podcast explores the growth and fragmentation of the VC industry, the demonization of larger funds, LPs' perspective on emerging managers, and the future of venture capital.

Brendan Wales and Kellan Carter of FUSE discuss building a strategic LP base, the growth of Pacific Northwest tech, engaging LPs, an activation layer for founders and LPs, the value of LPs in sourcing investments, and the importance of local venture capital in the Pacific Northwest.

Follow me @samirkaji for my thoughts on the venture market, with a focus on the continued evolution of the VC landscape.On this special meet the expert episode, we are discussing the venture debt market with Matt Trotter, a Managing director within Stifel Bank’s Venture division.Stifel Bank was established in St. Louis, MO in 1890 and is an independent investment bank with the mission to help individuals pursue financial goals, businesses and organizations raise and protect capital, and communities offer a higher quality of life.Given the dislocation of the regional banking market in early 2023, we discussed how venture investors and companies should think about the supply of venture debt, the proper uses, and what we should expect moving forward.About Matt Trotter:Matt Trotter is a Managing Director and Member of the leadership team at Stifel Bank. He focuses on providing commercial banking and flexible lending solutions to high-growth technology companies in the U.S.Prior to joining Stifel, Matt was a Senior Market Manager and Head of Frontier Technologies and Climate Technology and Sustainability at SVB. In this position, he focused on building products to support the evolving business models and capital-expenditure needs for companies creating disruptive technologies in the transportation, industrials, aerospace, energy, agriculture, food, and hardware infrastructure sectors.In this episode, we discuss:(01:15) Matt shares his background and discusses changes in venture banking and lending markets(01:57) Explanation of venture debt and its history within venture capital(03:11) Discussion on today's applications of venture debt, like runway extension and equipment purchases(03:59) Strategic uses of venture debt for various business needs(04:14) Overview of venture debt terms including non-formula loans, typical costs, and eligibility(05:10) Shift from equipment leasing to a more general-purpose financing model in venture debt(05:32) Challenges in underwriting venture debt for early-stage companies without revenue or product(06:26) Insights into the venture debt underwriting process and considerations(07:18) Role of warrants in balancing the risks and rewards of venture debt(08:15) Discussion on balancing loss rates and successful investments in venture debt(09:19) Ideal circumstances for a company to consider venture debt(10:24) Potential risks and considerations when opting for venture debt(11:43) Impact of market dynamics on companies with significant debt(12:05) How market shifts affect the demand and supply of venture debt(13:00) Importance of collaboration between equity investors and lenders during financial challenges(14:35) High demand for venture debt amid market uncertainties and banking disruptions(15:14) Underwriting challenges with companies having high valuation overhangs(16:53) Adjustments in underwriting approaches by banks and venture debt funds in current market(17:59) Use of debt tranching tied to company performance milestones(19:01) Differences between bank-provided venture debt and venture debt funds(20:21) Strategies, incentives, and focus of venture banks versus venture debt funds(22:57) Factors for companies to consider when choosing between bank loans and venture debt fund loans(24:22) Managing the balance between raising capital and working with banks in financial tight spots(26:07) Emphasis on trust and open communication between lenders and borrowers(27:27) When venture debt from banks or funds might be more suitable for a company(29:24) Assessing various debt products and understanding their true costs and conditions(30:14) Matching the debt product to a company's specific needs and circumstances(32:20) Need for reliable debt facilities for cashflow negative businesses(33:14) Reflections on the impact of changes at Silicon Valley Bank on the venture debt landscape(34:58) Outlook on the venture debt market's evolution post-SVB(36:58) Importance of lenders' long-term commitment in venture debtI’d love to know what you took away from this conversation with Matt. Follow me @SamirKaji and give me your insights and questions with the hashtag #ventureunlocked. If you’d like to be considered as a guest or have someone you’d like to hear from (GP or LP), drop me a direct message on Twitter.About Meet the Experts:Meet the Experts is a sub-brand of Venture Unlocked and talks with vendors and other non-GP or LP members of the Venture Community. There may be business relationships in place and appearance fees paid to participate.Podcast Production support provided by Agent Bee  This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit ventureunlocked.substack.com

Pejman Nozad, Co-Founder and GP of Pear VC, shares his inspiring journey from being an Iranian immigrant working at a rug store to building an $800MM+ AUM venture capital firm. He discusses building a marketplace, the value of taking risks, and the importance of a well-defined value. He also talks about scaling while supporting pre-seed startups, architecting growth, and focusing on strengths in the venture universe.

Paul Kwan, Managing Director at General Catalyst, discusses the importance of innovation in creating global resilience. He explores the evolution of value creation in the tech industry, the need for resilience in the changing world order, challenges faced by unicorns and publicly listed companies, and the significance of mission orientation and long-term relationships in venture capital.

Alex Pall, one half of the Grammy-nominated group The Chainsmokers, discusses his crossover into venture capital with Mantis VC. They talk about their transition to financial investments, emphasizing passion-driven investments, building networks for investment opportunities, critical decision-making, and finding inspiration from Jimm.