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Alex Bangash

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20
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2016-07-20
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2016-07-20
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1
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  1. “I like authentic stuff. I like authentic things and also changes with time. So on the one hand, I think some of the most authentic things that I've been seeing in the past decade started with.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “I think this is more openness to newer ideas and newer models. As Gandhi said, be the change that you want to see in the world. So, you know, we are doing it. That's why we built trusted insight. We are the network for all institutional investors, which increases transparency, which automates workflow, a world which is more forward thinking, not anchored in past tenants and notions that are no longer relevant.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “You know, the biggest challenge for me in my role is always finding amazing people and avoiding the ones that are not good. So whether it's employees or folks we can invest with or folks, you know, so it's always that's the cases. How do you find the best of the best? And at the end of the day, it's all about the people that you work with.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Models will perform much, much better. Mind you, all small funds will not do well. So it is just the ones that are structured to perform well.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “In fact, and this goes back to the LP landscape, so some of these smaller funds, and I would categorize it's not just all small funds, right? It has to be the best of the small funds. So if your loss rate is very low and you have no shot at investing in amazing companies, it is a very bad investment. But if you are dominant and you're not competing, the nice thing I like about some of these small funds is that they don't compete in their sector, in their geography, in their stage. They don't compete with Sequoia, Excel, benchmark, and recent. So they are dominant. They will never lose to them because they would never compete with them. And then when you get one of the big hits, your fund is spectacular. That is the key that some of these”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Absolutely not. My thinking is that if a smaller fund is worthy to be invested in, they should have a shot at 5 to 10x. I know it sounds ridiculous, but actually it is really, really possible. A $40 million fund, which has a portfolio of 15 companies and they own 15 to 20 companies and they own 15% or 20% of those companies and are able to, you know, as you can see, if they have one or two multi-billion dollar exits, you're suddenly talking of a very, very large multiple from a statistical standpoint and from just a moral standpoint, those kinds of things become very, very possible. Even if you assume a very high loss. So that's where we think the true venture is.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Take money in return for helping start the company, accelerators where they take the YC model and also post-accelerators. Along those lines, there are angel sea drowns and post seed. So almost the series A has become the fourth or fifth institutional round. At least my feeling where I see that is that that is the best place to invest. There was close to 40 billion raised last year, 14, 15 billion in Q1, 90 to 95% of that is not going into true early stage. True early stage is getting smaller and smaller. So investors are investing. Institutional investors are not investing in stock. Companies, which venture capital used to be investing in growing companies. That has been a fundamental structural shift.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “In every asset class, in every sector, the best returns are always in places where others can't invest. What happens is that smaller funds raise larger funds, smaller managers, they then tend to compete for the same deals. They might be putting smaller checks, but they are in the same Series A or B. Many of the Series A or B that you're seeing today are actually very similar to what Series C or D used to be 5 to 10 years ago. We are witnessing Series A of anywhere from $15 to $100 million. So even the smaller funds are now being a part of these later stage rounds. Early stage venture capital is now defined by rounds which incubators are doing with.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “So, in a lot of sense, it's almost the same as a company, right? It's like how you let your best indicate. And typically you select the best syndicate of two types of people. One, A, that they can give you signal.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Insurance companies, they might have pensions and insurance companies, they might go to European investors, they might lose their European investors, they go to Middle Eastern investors. So there's always somebody else. And it also goes to return expectations, like you were saying. So venture in some sense the return expectation of venture used to be three to five X and above. And now there are folks in the industry, there are perfectly fine with a 2x net return because internally their return expectations are much, much lower. That's kind of what has happened.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “This is a very interesting dynamic, is that we talked about the big funds and the smaller funds. So unfortunately, the dynamic of our industry is such that amongst established managers, if you are a traditional quote-unquote VC, not an incubator accelerator, post accelerator, what's actually happening is that there is always this theory of a bigger food. So what happens to them is that they might not be smashing it. But because they're established, they are in the palette of managers from which people choose. So they might use some investors, but another set of investors, another different type of institutional investors, they might have endowments and foundations, they move to pensions.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Platforms like Angelist. Now I'm a big fan of Nawal. Angelist is arguably much further ahead than anybody else, but this is still the beginning. We think there'll be many, many amazing platforms. It's just like when you look at social networking, right? It didn't start and end with French stir or MySpace or Facebook or WhatsApp. Now they're a Snapchat, so they'll always be innovation there. There are a few people who say, oh, well, this is the end. After Twitter and Facebook, social networking is done. It's never done. It's always evolving. And the next big wave as we talked about AI is almost as fundamentally disruptive as the web was. So with AI and APIs, We are entering this brand new era where a lot of very, very significant companies are going to be built and some of those will also be in the investing space.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “I think angelists and others, so there is a structural advantage that platforms like Angelist and Y Carbonator and entrepreneur first and others have. So we do see, and this is kind of what we were alluding to, venture now has done quite well and everything is looking good in most asset classes, a third to a quarter of managers lose money in venture that could be depending on the vintage that could be half two-thirds of the managers. Now, today it looks like everybody is making money, but when the tide comes down, it will not look so well. So we think some of the best managers, which will actually be”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “Which has always been about access to one of our famous folks in the industry has said venture is not an asset class, it is an access class, right? But that access class is now even more transparent. When an entrepreneur doesn't like somebody, he tweets about them. He puts it on a slog. Hey, we see pulled a term sheet. So it's much more transparent and that's why you have seen a number of funds in recent first round founders fund, but being friends of entrepreneurs rather than having adversarial relationships, which was much more common in the 80s and 90s.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Identifying where the puck is going. And that's your job, which I'm intrigued then to dive into because you've said before about kind of what managers do well. So I'd love to hear the commonalities you've seen in the types of managers that do well and why they do well. I think the biggest change that has actually happened in the last 10 years, and we saw this around 2005, today the entrepreneurs are picking the managers. This is in stark contrast to any other asset class. So in any other classet class, you can look at a great manager and you can”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “For many LPZ to invest in something. So that is one kind of philosophical issue that is at the forefront of the changes. So many of the newer firms, not all there are exceptions. foundry first union square park they all came out of existing amazing firms so and there is nothing wrong with that i think those firms deserve the amazing success that they have and it's those firms it is easier to identify but the entrepreneur led models which by the way tend to do you know the most of the most disruptive new models are very hard for institutional investors to identify and you said there are”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “In venture capital, but it's incredibly hard to figure where the puck is going. And I think there are kind of two reasons for this. And I'll tie this back to what you have said before, right, about technical expertise. So if you take some of the best new funds that came in the last decade, say Founders Fund for Strong Capital, Lowercase Y Combinator, all of these firms are entrepreneur focused and entrepreneur-led funds, for LPs to identify these such funds very early is incredibly, incredibly hard because they don't have prior relationships with funds like these. Additionally, these funds don't, these firms don't have an attributable track record, kind of a pre-release.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “One of the key tenets of philosophism of venture is that venture is a highly persistent asset class. The top VCs or top branch will continue to do well. Now, if you look at, just pick the Forbes MIS list, for instance, and you will see that four out of the top 10 VCs, Steve Anderson, Chris Acker, Josh Copper and Peter Thiel in that they didn't have firms 10 years ago, right? Even Andreas Horowitz wasn't around 10 years ago. So for all this talk of we see being increasingly persistent, the reality is it's not and the reality is that there is a huge”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “No, I don't think it's a problem for the industry. That is probably a bigger problem, which is that the entire, I would say the entire finance industry is backward looking and not forward-looking. I would say that there are some philosophical issues in how we think about investments and our biases in that everything is backward looking, whereas the future is very different than the past.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “So, I think for me it was just circumstances where I had first thought of joining venture capital, but at that time this was around 2001, 2002, there was no venture capital happening. So when I talked to some of my mentors at that time and some of the people in the industry, they said G Alex, why don't you consider looking at what the LPs think of this market? And then when I started talking with the LPs, I found that if I brought to bear my technical and operational expertise, in that field I would have a differentiated approach. Away VC. I spent close to a decade at Well Labs working in different technologies. Many VCs had similar background as me, but very few LPs had the background and context that I had for technology investing.”

    2016-07-20 · The Twenty Minute VC · 20VC: Why The Whole Industry Is Backward Looking, The Best Funds Are Entrepreneur Led and Venture Is All About Access with Alex Bangash, Founder @ Trusted Insight · IDENTIFIED FROM THE TRANSCRIPT · source