YouSaid · the spoken record

Henri Pierre-Ja

lines on the record: 35
first: 2022-06-24
most recent: 2022-06-24
sittings or episodes: 1
sources: podcast

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“For me, a company called Mushi, which is a high end NFT marketplace platform for artists who are basically converting their real-life artwork to NFTs. So Ariana black female founder based here in Miami. I met her during Art Basel at one of our events. I'm really excited. I love her focus. I love her connections to the galleries from distribution standpoint. But honestly, the thing that's been best is like our friendship. She goes to my church with me. She's best friends with my wife. They golf and like we didn't know her five months ago and now she's really ingrained and so it's been really awesome to have founders in Miami. I've invested in two companies here now and really like get to know them as humans. That's what I'm most excited about.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I would like LPs to take more risk on GPs. I think they have their check the boxes, track record, who are your co-investors, yada, yada, which historically have shown some outcomes, but I think we're in a time where it's solo capitalists or it's diverse GPs or it's smaller funds or micro funds. A lot of the past data just isn't as relevant for the data that we're using today. So I think it's, hey, you're asking GP to take risks, but like you need to take risks. I say the same advice to GPs. VCs were asking founders to put all their eggs in one basket. A lot of VC are pretty conservative. Don't ask them to take risk if you're not taking risks. So I think it goes down the scope. LPs take risk. GPs need to take risks and founders need to take risk.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Learn to not take the nose personally. The first people you go to in the beginning are going to be your mentors, the people you worked with, and everybody who I thought was going to back me, most of them didn't. It really hurts. I remember my best friend's dad turned me down on like, if my best friend's dad, who I know has money, isn't investing in me, like we're in trouble. And I remember my dad, I called my dad because I was like kind of crying. I was like, hey, it's not going to work. And my dad was like, if people don't think your dreams are crazy, you're not dreaming big enough. Don't take it personally. It just means you have a really big dream. It's okay. Keep on pushing. And 12 months later, my best friend's dad came in as an LP at the end. I let him in below the minimum because I wanted him. But I think that part from my dad really spoke to me. I think it just made me realize it's okay to my point of being a founder. You're pretty cocky. You think you can do something better than anybody else? That also means a lot of people could believe you can't do that. And that's kind of hard to impact.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Hard matter ENIAC is probably one of my favorite LPs, and to your point, smaller check, but phenomenal upside. And just like somebody who's built five funds is such a human. And I just love what they've built and what ENIAC has done to humanize venture. And that's really what we are trying to do at Harlem Capital. Like, it's not this quantitative, like we're not just like LP hungry. It's like, hey, like we're all humans. Let's enjoy this experience. We know we're all going through trauma, especially the last three years. So I really appreciate Nahal's perspective on, oh, like COVID's happening. What are you guys sending to your founders? Like, how are you thinking about that? How are your founders doing? Like, are family members dying? Those questions, I think a lot of other GPs and LPs don't ask. I think they're really valuable. And I think a lot of founders appreciate you being thoughtful about them.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, she's my best friend, so I think ultimately it's to your point, we challenge each other, but we have fun together and we support each other.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“You gotta block stuff off on your calendar, workouts, date nights, etc. And if you do have a partner or you do have kids having a sheer calendar is a lifesaver. So my wife knows every time I have a meeting or event and she can decide if she wants to come or not, there's no question, what are you doing tonight? And that's a big time saver. I always say the seat.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I moved to Miami a year ago after living in New York for eight years, and I think I realized that productivity isn't tied to the number of hours you work in Miami really forces you to realize the value of living life and that you can be productive and not grinding all the time. That was a big shift coming from the hustle city of New York for me.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Value over five years. I think too many founders believe if somebody invests, they just believe in me. That's not true. We sell a lot of risk. There still were a lot of references where maybe they saw flaws in you or you had bad founder references, but for whatever reason, we tucked that risk because we believe the reward's higher and that founder has no idea. And every founder we've ever given our memo to always says the same thing. I've never seen an investor memo before. This is super helpful to understand how investors think. It's super helpful to see where my weaknesses are and really appreciate it.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Here's our 30 page memo. Here's why we chose the decision. Let's have a conversation. Institutions love that. They care about processes. Thirdly, we lead most of our deals to the way we close a lot of our rounds fast. We close the deal. We do whatever $2 million check on a $4 million round. And then when people get late, they've got to a party meeting, we allow our founders to send our memos to the other funds. So we say, hey, like don't even go waste time. Here is 60 pages of work. We probably won't do more work than us. Use this to get it faster. And then our founders love it. So we do a launch call after we invest for an hour. We basically give the memo to our founders and we say, hey, we basically gone through your data room. We spent hours asking questions. Here's all the work we did. It doesn't mean we don't see risk in your business. We still see risk in your business, but we thought there was higher reward than the risk. We want you to know where your flaws are, and we want you to be able to ask us the questions because we did this in private equity. In private equity, we would do a two-day retreat after we invested. We would go to the management team. We would fly in all the consultants we use, and we basically would have the consultant present to the management team and say, hey, we invest in your company. Like here are the mistakes are, and here's what we think we can gain.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“So first it's in PowerPoint, not Word, because I don't believe in Word docs. And a lot of investors have different views on that. There's three reasons. The first reason is we want all the information. So this includes customer references. It includes founder references. I don't want to send the other partner who's on the DO. Hey, like, here's the Google folder that has five different Word docs with all the customer references. Like, go and read them. Like nobody has time for that. Give me the document, put all of the stuff that you did into one document and say, hey, here's a document that has all of our diligence process over two to three weeks. Read this document, come back, give me your feedback. So part of it is like streamlining the process. People think it actually like slows it down. It doesn't. We do deals as fast as 48 hours, 72 hours. We can do a 30 page deck that fast. The second piece is to my point of like, what process are you doing to scale? How do we get six institutions in fun one? We did deal memos for angel syndicate. So when people are trying to validate our, hey, you pick these companies, great, you've made money. How do I know you've actually institutionalized that? We said, hey, here's our at the time when we were angels, they were 30 pages.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Order to get to a thousand diverse founders, Harlem Capital cannot be the centerpiece for that to happen. So of those 76 interns, 24 now work at other VC funds. That to me is probably one of the most proud stats I have because I'm like, now we're creating the future investors and we're creating diverse investors at other funds, some diverse funds and some white funds where we need that one diverse mind to be at injuries and to be at forerunner wherever it is to speak and advocate for diverse founder if it's not going to be your Harlem Capital Company. We only invest in 15 companies a year. So I'm like, I need other funds to actually help me on this mission and intern program for us has been an accelerant to how do we change the landscape faster versus saying, hey, Harlem Capital, seven people, we're going to change diversity and venture. Like that's just not true. Our intern program can't help us say like, hey, we're going to make a big impact because people come to us now because they know we're hiring six of a thousand people. We see the best of our hell in the market by far for venture.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“So we do three intern classes of the year, six interns per class. So winter, summer, and fall. It's for part-time remote, so 10 to 15 hours a week. It's remote as long as you're based in the U.S. And we've gotten really good at our first intern class was spring of 2018. Gabby, who's our principal on the team, was our first intern class. And we did that intern class to fundraise. We're like, hey, we need to build a deck. We need a data room. Let's go get some interns. And what we realized was like we were looking for two. We ended up hiring four because they were so good. And that first intern class, we had 125 applications. We were just two kids in business school who didn't have a fun yet. Now our last intern class, which starts in two weeks, we had a 1,250 applications. We hired six. So I think over time, we just realized like one, we have a really big brand. There's a ton of diverse people who are trying to get into venture regardless if we hire them or not. It's great for us because we have to leverage them. It's probably our greatest asset. People see our deal memos, which are 50, 60 pages. How do you do it? We're like, well, we have great interns. I know I haven't done deal memo in two years. Like my interns do my deal memos. But also what we saw was like, hey,”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Capital is definitely one, particularly if I look at where now the probably third or fourth largest black-owned VC fund, which is kind of crazy. So capital is definitely something you think about because the reality is dollars aren't flowing to minorities and there's a cap. And I would agree, I mean, I think everything in life is a people's business. So I'm very focused on the team. I did a tweet about this. Like oftentimes they tell you to focus on the customers. If you're a founder or for GP to focus on the founders, be founder first. I'm team first. I'm going to be successful because my team is the best team they can be and they can execute. I've already seen the difference of going from two people to seven people to your point going from 80% founders to 30 founders. My job now is not like just to help founders. Like my job is to enable my team to be as most physician as possible. That's only going to continue to exacerbate as I have more team members. So I think about that a lot like talent. Talent to me is number one. If we can hire the right talent, we can build a brand that can recruit the best talent, which our intern program has done. We've had 76 interns over four years. We've hired five.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Regardless of people say I'm cocky or humble, whatever it is to people, intrinsically, when you're starting a fun, when you're starving a company, you believe you're better at doing something than anybody else that's never been created before. You're basically telling the world, like, I'm very confident and cocky that I can do this better than seven other billion humans on the planet. So to some extent, like you have to own that. Own it, have some level of”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I would say the biggest mistake early on, and it's the same for founders, when you're asking people for money, the people where money always seems smarter than you. You're a first-time manager, people are giving you advice, they're flipping your deck literally in front of you, marking stuff up. I remember seeing people Xing stuff out right in front of us, like, oh, they're not investing. So to give you that advice back and you keep changing stuff, we had probably 200 versions of our fun one deck. There was a moment where we met with a billionaire and we turned to him, you know, at the end of the pitch and we said, hey, like, we'd love your advice. We love your check. We'd love for you to invest. We kind of hesitated. And he said, advice is cheap. Ask for the money. And like it was like this like light bulb went off for us. It was like, okay, like we've done at that point maybe 50, 60, 70 pitches. We need to stop asking for advice. So literally after that, we would go into meetings and people would give us advice. We'd like really appreciate your thoughts. Like we're going to be successful, wherefore we're value, but we'd love you to be on a journey with us. Let us know if there's anything we can do to get you over the line. And I think there's a level of like hackiness and confidence you have to have. It's a balance, obviously, humility. You're a founder, right? So I always tell people like, we're”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Going an extra step and doing the work for them and saying, Hey, I looked through your boards, I looked through your LinkedIn. Like, here are the top five to ten people. Can you make an introduction to two or three of them? That was really wildly successful for us in terms of getting that layer two of LPs.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“So, when we first launched the fund, it was actually Tax Day of 2018. And we did this mass email and we got like two responses from like 100 emails of people who we knew. So I think the first thing we realized was like, hey, we have to go really deep. We need to be super targeted. So I think even to your advice of asking LPs for three references, like we went a step further. We had our first intern class that spring to help us fundraise. So we literally went through and we scraped every board that every person we knew was on. And we looked at like who were the other people on those boards. And then we would go on to their LinkedIns and see like, hey, are they connected to these people on those boards? We would go and see like, okay, what schools did they go to? What clubs are they in? I think even for founders, for me, when they come and say, hey, do you have three people you can invite me to? I'm like, go and look through and then tell me the five. Like, I don't have the capacity to take the time to find those three for you. And LPs are the same way. When you ask LP for three introductions, they may give you one or two if they're really nice. Most of them are going to be like, okay, cool, and they'll never get back to you because they don't have the time. It's not my job to find people in my network for you. So I would say even like.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Them, they actually were really big advocates for us. So we did big press release on in the Wall Street Journal. We had fundraising meetings. Like we literally went to Boston, I remember, and they had one of their fundraising team members come with us in the car and we drove to every institution that we went to Brandeis, we went to Harvard, we went to a couple family offices. They had a rep like next to us who were supporting us. And we would do our pitch. And then if they asked any questions about TBG, the rep would say, hey, this is why TBG is supporting them. So that was really helpful. And we got two of our other six institutions from TBG. So three of our six came directly from the TBG relationship, which was super powerful.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I think there are two things. I think the first was we were so left field that it was like either you got it or you didn't. And if you were an institution who had been looking and searching for diverse managers plus diverse founders, like the diverse manager piece has been in the LP world for 10, 20 years, emerging manager, diverse manager programs. But people now are like, okay, great, we've backed black GP similar to my private equity fund, but their portfolio is still white. So ultimately, we're helping to make whatever five, 10 people of color or women more successful, but like that's not scalable. So I think LPs have been having this question and now I say, okay, well, now we have a diverse manager who's investing diverse founders. Those diverse founders have been proven to hire diverse teams. Now you actually begin to get much more deeper network effects. That was first. And then second, TBG was our anchor in Fun one. So one of our high net worths introduced us to TPG November 18th and we had a bunch of conversations. We were doing this for five, six months back and forth, met probably 45 partners. It was six month process. And TBG ended up being the anchor for our fun. And once we had”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“That was probably one of them. They didn't believe that there were enough diverse startups that could scale and venture. We were like, hey, we're trying to invest in 30 companies. There's, let's call it 150, 170 million people in the target audience. I think we're going to be okay. It was a real pushback because it hadn't been seen before. Obviously the first time manager, we were young. I always tell people like we were basically one of the riskiest first-time managers you can back. We never worked in venture. None of us ever had a startup. We weren't operative. We came from private equity. We were 27 years old. We were black. We were investing in people of color. It was like all the like risks were just thrown into our fund. And, you know, so we're grateful. We ended up with six institutions in the fund and we had a lot of GPs and family offices. It was a grind, but I think we really were happy where if the outcome and we had people who saw the vision before a lot of the people came post George Floyd because Fun2 was a much easier raise and fun one.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“That's been a really big conversation, particularly for diverse and woman managers, because I'm 30, I'm young and I'm not one of our LPs like, hey, I have a different scenario than a tiger capital, et cetera.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Being a fund manager. So, you want to learn from that. So, I think we learn from that. And then thirdly, you just want to be honest and open with your LPs. And we had a few LPs and fun too that we didn't let in for whether it was GP's sake or other rules because we just felt like they weren't really humanizing us. They kind of were using us as a number. And my partner, Jared, for fun one, like he had a baby three months before we closed the fun. And we closed the fund. That was six months after we graduated business school. We were 27. We had done this angel investing to build a track record for the fund. So we hadn't just been saving because we were using that as our track record. We had LPs that understood that and we said, yes, 1% of 40 million would be great, but like we've already put up a quarter million dollars in the angel portfolio. Like we're investing in this. We've already sacrificed for business school. We've already put up another quarter million in GPS. Like if you don't believe that we're investing in this business, then like you're not the right LP for us. So I think there is a level where GP has to take a stance and try to have LPs that can really reflect and say, hey, like as a human, every like percentage basis of a fund isn't the same because everybody has different scenarios.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I think there's a few things that we did that help. So one, we did one person, which is standard. Some people have gone less, some people have gone more. We said that one person at the target of the fund. So fun one, our target was 25, our cap was 40. We hit 40 million. So we ended up doing 250K instead of 400K. And we said, hey, like 250K, we were 27 years old. I was graduating from business school. That was still a lot of money. I had $120,000 of business school debt. But we said, hey, we think that it should be based on the target. There should be some cap. If we get to the cap, great, but that shouldn't be the GP cap. Second thing we did in Fund 2, which we didn't do in Fund one, which was help, was get a GP credit line. So basically we use Silicon Valley Bank. They put up 60% of our GP stake. We put up 40% of our cash over time it gets paid. That's really helpful, particularly because we raise fund to a year after we close fund one. So you start to stack these GP6 really quickly and you've got no carry. Your partner is all this money going to? Are we going to get it back? So you do want to leverage one of our LPs in Fund1 always said you want to use other people's money as much as possible. That's the beauty of finance.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“The go to the world to me who have built institutions versus great, you're a great angel investor, you're a great picker. That's a very different skill set. And it's not scalable for a lot of people. And I think people underestimate what it means to manage the business side of VC versus just the deal side of VC.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“We invest in fund managers as well. So I've invested in 12 funds. The biggest thing that I learned, TBG was our anchor investor in fund one, and I remember Jim Colter, the CEO of TBG. He was an awesome year of two jobs. Invest in deals and manager funds. And there are two different skill sets. It kind of reminds me of co-founders, right? We love CEOs who are business oriented and the co-founder being a CTO. It's two different jobs, fundraising, managing team versus managing a tech. And a lot of fund managers, especially early on emerging managers, think that by being the best deal picker, having the best sourcing, like they're going to be the best fund manager. You can do that at small scale, right? 1050 million. You can just be a picker, not think about ownership, have maybe no associates, no memos. And that's fine. But if you want to scale and be in this business and become the injury systems investors of the world, that's not going to work. And that what Andreessen's doing, you know, they just announced a four and a half billion dollar fund. That's a completely different skill set. It has nothing to do with deal picking. You're that kind of fundraiser, that kind of money manager, that kind of talent hire, that is like, I think what the difference is between”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Do this for the rest of my life. I'm trying to build a multi billion, multi asset class business globally. So like I'm positioning myself, I have other friends who've raised funds. They want to stay small. They want to stay 10, 25 million. Do this for maybe two, three funds. That's a very different perspective on what you're trying to build at scale.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Once you decide your bucket, right, if you want to do extreme spray and prey, then obviously you're not going to have reserves. If you want to be diversified, be the lead. We lead 80 to 90% of our deals. Have the board seats. Like there's only so much diverse you can do. There's a lot of constraints as a human. For me personally, I don't like SPVs. I don't like all the extra headache. It's not worth it. Our team thinks it's a distraction. We'd rather have one fun, right? Maybe over time as you get larger, we'll have a growth fund that's separate. But it really comes down to what's the team capacity, how many boards can you be on? How many deals can you do? What's the back office? fund administration. There's a lot of other nuances I think people forget. But I think really what you're trying to figure out is, hey, what is the best risk reward profile? That's what institutional pieces are looking for. They don't care if you have one 5x. They'd rather take a 2x over 10 funds consistently than a 5x, 1x, 3x, 2x. They want to know, do you know how to institute and operate and have processes that allow you to best execute at scale for long periods of time? And that depends on the GP. Like we've been very upfront with our LPs. Like, I'm 30 years old. I want to.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Funds you've been investing for 20, 30 years, there's pretty clear data on the ownership and size fund that lead to the 5x net outcomes. For us, like we're not targeting to be that one Coinbase outcome, that one stripe outcome. Like we're saying over time, how do we get LLPs to know that we can consistently generate three to five X net returns based on math that's been done over many decades? The market has obviously changed. People thought the market was going to be new the last two years. Obviously the correction has kind of changed that. We're back to reality. You're going to have these spurts where things will change and people say, oh, well now you can get these outsized outcomes. So ownership doesn't matter. Well, yeah, now you're outsized outcome is 70% lower value and you're back to normalization. The market's always correct at time and time again.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Ultimately, the price only matters based on the fund size. So once you kind of decide which camp you're in, let's say we're in the diverse camp, 30 to 45 companies, we decide, hey, for whatever size fund you are, we need this much ownership. All that really matters is based on whatever reserve model you have, you know, the average reserve model is one-to-one per rata. So let's assume a $10 million or $100 million fund. I'm doing 50-50. I went 30 companies like you basically can back into what is the max check I can write to get my ownership. So for us, $134 million fund, we tell people we invest one to two and a half million dollars for $10 to 15%. Now, if that $2.5 gets us 10% versus 15, that's going to vary based on the price or based on the round. We can't go below that threshold. The math really doesn't work. I think it's pretty clear over time, like we have a lot of fun to fund to our LPs and our fund. If we look at fund to fund data over time, obviously they're outliers. Obviously, you know, I was listening to Box Creeper on your show, like you can get the Coinbase $100,000 check and can return the fund. But if you look at like overtime Green Spring, Truebridge is the best fund.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, the average first time fund in the US is $40 to $50 million. I think that's the spot where you probably can do your 5 to 8% ownership. That's probably average for a size of that fund. So ownership does change, obviously, as the size of the fund changes because you need larger returns. So I don't think ownership doesn't matter at a sub 50 million. I think it's just, you need less ownership, right? Because a $500 million or a billion dollar outcome for $50 million fund.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“when we look at where we want to go and what we're trying to build it was pretty clear to us like what the portfolio construction needs to look like based on where we want to go long”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, I basically see three camps either your concentrated portfolio, let's say that's sub 20, you're a diverse portfolio, probably 20 to 45 deals. This is purely for seed stage, or you're kind of spray and prey 45 plus deals, but 80, 100 portfolios were mostly pre-seed funds or some seed funds. According to Sapphire Vintage, which is one of the best fund to funds, the average seed stage fund has 28 companies in their portfolio, so I would say it's probably that's diverse. For us, I think we wanted a balance of diversity because obviously it's a law of outliers. But based on the fun size, like, can we actually get the ownership we need in that diverse portfolio? Like, we are big ownership believers. Obviously, I've listened to a lot of your shows and there's a huge spectrum of ownership matters. I think fundamentally when we look at like who are the funds that we want to be the best owners of Sequoias of the world who've been around for multiple decades, like, yes, you have to pick the best founders, but like there's a reason the best funds have been around for 30, 40 years. These funds are very strict on ownership targets. Like venture is a math game. It's not different from other asset classes, private equity real estate, like there is math involved. And so I think for us, like just”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“It was pretty scarier at first, right? Our first checkout of Fun One was $250,000. Our average check as an angel was 2825, so like we had 10x the check size and we were like, I was like, this is a lot of money. By the time we finished fund one, because we started deploying capital while we were raising, we were writing 750K million dollar checks. And so I always tell people, like, as you scale your AUM, your comfort level for discomfort increases. Now, on Fund 2, you know, our average check size is 2 million. So I've basically gone from 25K to 2 million in three years. And like it feels like it'd be really scary, but it actually gets more and more easy as you do it for longer periods of time. So at first, it definitely was scary, but I think over time I really adjusted to it and spent a great learning experience.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“Not fully knowing exactly what that meant. Our summer of July of 2018 between first and second year business school, we formally launched Fund One, ended up raising $2.5 million second year business school, and then ended up closing on $40 million November of 19, six months after we graduated. And the pure thesis was just the back women, diverse founders in the early stage.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source
“I always tell people I kind of bought my way in adventure. I started out in investment banking at Bank of America. I did that for two years, then moved over to a black owned private equity firm where Jared and I actually were cubemates. We were working in PE and we basically said, hey, why don't we do what we're doing at work for ourselves? We're obviously making decent money. So we started Angel Investing. That was 2015. Jared's living room in Harlem. We all live in Harlem, which is where the name came from. Started Angel Investing, did that for two and a half years. Jared and I were both fortunate enough to get into Harvard Business School where we were roommates. And we started recruiting at HBS for venture and private equity roles. And most of our Angel investing were into diverse founders, even though it was in our mission. Our firm was black owned. So to be frank, going from Bank of America, where I was one of only 45 in a group of black people and a group of 45 working at a black owned firm. I didn't want to work for a firm that didn't have black partners, which was 99% of all VC funds. So I turned to Jared, my roommate in the kitchen, said, hey, like, why don't we use our Angel track record? And instead of recruiting, raise a fund.”
2022-06-24 · The Twenty Minute VC · 20VC: From Kitchen Table to $134M Fund II; Raising Your First Time Fund: Lessons from 400 LP Meetings, How To Find New LPs, What Materials to Use, How To Get LPs To Commit, The Challenges on Minimum Check Sizes and GP Commits and more with Henri Pierre-Ja · IDENTIFIED FROM THE TRANSCRIPT · source