YouSaid · the spoken record

Jake Saper

lines on the record: 123
first: 2025-03-10
most recent: 2025-03-10
sittings or episodes: 1
sources: podcast

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“For all of the things that are more rote and less creative to go away. And I'm excited for the fact that like we can hopefully be more human. Like we really can, I can connect with you more and spend more of my time understanding how are you actually thinking? How are you feeling? How do I make you feel better? How do you make me feel better? Hopefully we'll have more as I played for you before like moments where like my three-year-old sings, what was the song? Yeah, shake it off. This is the Taylor Swift song. We can have the machines put the music behind it, and we can focus on her and elevate her.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“That change is coming. That cognizance is very hard to live with for all of us and certainly for Sam who has a courtside seat. And so I asked Sam, how should we think about raising our kids knowing that this is changing so quickly? And his first reaction was, don't teach him to code. And then he was like, what I mean by that is like teach them the logic of how to think like that, but you don't necessarily need to teach them the mechanics of coding because that's obviously likely going away. But what he said was very specific. He said you need to teach them how to understand how people are thinking and feeling and how to influence that. And I excitedly came home and told my wife, who is a career leader of big revenue teams and who is now teaching the course on sales and persuasion at Stanford Business School. You're the future. And I'm grateful that I had kids with you because it means that our girls are going to get this just inherently by being you as their mom. So when I think about like the future and what I'm excited for, I'm excited.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I don't know if this is an answer to your question, but I'm going to say something has been on my mind. I had a conversation with Sam Altman three months ago where he was talking about the cognitive dissonance that he lives with every day, knowing that So, how do you make decisions right now about what to invest in, about how to live your life, about how to raise your kids, knowing that that's”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Here's our carry. It means it's ours to run. And it means I can look you in the eye if I'm recruiting you to be a principal and groom you into my next partner and say, you have a real chance to be an equal partner alongside me.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I am so, so grateful for this. So, as I mentioned, we grow partners from within. We think it's one of the things that makes us different. Part of the reason we're able to retain incredible people like my partners Loti and Yaz and others who have come up behind me and me and Joe and Santi and Kevin, all the people that have been grown within the firm is because our founders made the very generous choice when they step away from the business and retire to forfeit their carry. This is not something that's talked about in Venture. And I had no idea about this when I was considering which firm to join. But the vast majority of founders of firms, when they retire, they retain a meaningful portion of the ownership of that firm. That creates really bad incentives for the really high performers. Because if you're a really high performer, why would you stay at that place? You'd go start your own thing. And that's part of the reason why you've seen such proliferation of new funds pop up. The amazing thing about our place is I have no reason to leave because the generosity of the founders who stepped down and said, you know what, we want to empower the next generation. We've made enough money.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“The reality is like there's not a specific person or brand where I'm like, oh shit, I'm fucked. That's part of why my job is to get to know people early. In our last fund and fund five, we did this analysis. We knew the founders on average 13 months before we made the investment. We know it matters.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“We got into the top three of the bidding process with them. And then they went silent. And I was like, that's not good. And then I got a phone call at 9 p.m. from the CEO. And he said, so good news. You've made it top listed in the top three. The way we're going to decide this, we're going to have a mock board meeting. In one hour, I'm going to send you a bunch of materials as if this is a board meeting. And then we're going to hold a board meeting. The three of us and you, and we're going to see how you perform. And this is exactly what happened at like 11 p.m. He sent me these materials. I prep, and then we have a board meeting, and he saw how I showed up as a board member and ultimately chose us. I'm very passionate about board service and the right way to show up as a board member.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Assembled, which I mentioned before, is AI for support teams. We led the Series A there. It was a very, it was also a very consensus deal in the sense that the three founders came from Stripe. They had built the tool at Stripe to serve Stripe, and they were like, oh, this thing is bigger than just one company. We could spend it out and start the company. So Stripe did this seed. I think it was the very first deal that Stripe did as a seed investment. As you can understand, like the Series A was very frothy because everyone and their sister wanted to invest in these hot stripe founders. I'd gotten to know the founders for a while, had tried to push Brian, the then CEO, to let us invest, and he wanted to run a process. And I get I get a text message from him. I think as I'm coming back from my honeymoon and I'm all blissed out, and he's like, hey, man, process is live. Do you have time? And I'm like blissed out and like not in a place where I'm running after deals. And I was pissed because I had been in front of that one for a while. And I was really excited about the company. But I flew back, you know, worked really hard. My partner, Yaz, who was then an associate, did an insane amount of work to get us up to speed.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So I sell Grock. I don't yet know what niche they've carved out the market. OpenAI feels expensive, but they have a strong consumer brand. I probably buy Anthropic, assuming they can figure out the app stuff more. I think that the underlying stuff happening there with the model seems quite promising.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Thus far, I haven't had any zeros. I'm sure I will. The exit I've had that was the worst exit was a company called Comfy, which was building energy efficiency software. So basically it provided employees within an office the ability to change the lighting and temperature from their phone wherever they were and would actually follow them around and remember their preferences and change the building accordingly. It's actually quite cool. The business grew really quickly from a bookings perspective. They would have these big seven-figure contracts from Salesforce and others, but the people in charge of deploying the product didn't care. And so there was a huge incentive issue between the buyer and the implementer in that business. And so we have huge bookings and we didn't have great deployed ARR. And that gap bit us in the ass. We ended up selling the business to Siemens. We actually made a little bit of money on the deal. And Andrew, the CEO and I stayed close. He actually bought me a gift certificate to the French laundry, which I still haven't been able to use because the reservations are so hard to get to thank him for helping navigate through the outcome he ended up making a good amount of money.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Like, obviously, being involved with Zoom very early was huge. I think the two learnings I had there are market pull, incredible market pull and then founder insight. If you can find something like that, founder insight around creating something differentiated, it's a recipe for success.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it could be much larger. I mean, I'm obviously biased, but like Dr. Son. Yeah, I think that's potentially much more. I think in part because if you look at DocuSign as a comp, like that business got very large and was just literally signatures. You know, we now do that as well. In addition to contract management, which is a much bigger thing, we also have this AI product that we've built called Jurist, which is a hardy competitor. Pretty cool, and it's grown real quick. And so I do think there's rel upside to it, but we'll see.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Somewhere in the 300s, something like that, maybe 400. I don't remember specifically. The company's now north of 100 million revenue. It's doing quite well.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“The series B came super quickly, and to Jess's credit, she ran fast and got in front of him first and put the term sheet in and won it. Obviously, the happy story is I ended up investing in the next round, I think, is the only external investor in the next round.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“The first deal I lost. I think I've lost two or three deals in my career so far. The first deal I lost was Ironclad, and I lost it to Jesse at Sequoia. It was super painful. So the context is I had gotten to know Jason, the CEO there before he started the company. So he was at a coffee shop and met my wife because she was wearing, I guess, a hubspot shirt and like he was curious to learn about sales. This is what they tell me. And they talked. And Danny was like, my wife Danny was like, this guy's amazing. You should meet him. So I met him. I really liked him. He started the company at the time. We weren't doing much seed investing. So I didn't look at the seed. And then at the A, we had invested in a company called Simple Legal, which was like billing software for lawyers. And on their roadmap, they had contract management. They hadn't built it yet, but it was on their roadmap. And so we made the investment. And then I called Jason. I was like, listen, man, I really love spending time with you, but I think I should not be part of the Series A because of this. He agreed. And so we didn't participate in the Series A at all.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I generally like the stage specific firm. So, like on the late stage, I like the Meritech folks and I like the Green Oaks folks. On Series 8, I mean, similarly, I like the folks that tend to be more thematic and focused. So Mavarond is great and the consumer side of things, USV.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, but you're asking me to hold one stock And so I'm putting my entire portfolio in something. I'm going to put it in something that's safer.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I think Microsoft, and the reason that's the case is because I'm obviously long B2B software, and that's probably the best index.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I tend to think next year, like I think there's enough uncertainty in the market right now, particularly in the macro and the political situation, that there's a lot of people that are nervous. So my best guess would be like the beginning of next year.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“You know, so there's a business that was actually bought by a British company called Sage called Intact. So Intact was the kind of number two cloud ERP player. We were the early investors there, and that company, ERP is a tough thing because it's the most mission-critical system of all. So it's really hard to rip out someone's ERP. But by definition, once you get in, it's really sticky and so you can stay. That business grew slowly and then had some cash problems. We decided to bridge the company. And that saved it. We figured out that business also figured out a channel partnership motion. They figured out through accounting firms, actually, and that business took off and was bought by Sage, I think it was for a billion dollars or something. We made a ton of money on that whole thing, but also on that bridge because that bridge was obviously in favorable terms given the condition the company was in. And so that's obviously a cherry-picked example, but there are examples where it's not a bridge nowhere.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“I think when it's a keep it alive scenario, we're a lot more thoughtful and we'll often get someone else involved because every reserve situation is different, right? If it's a reserve where it's like it's parada on a series B, where we did the A, companies performing well, it's a little more straightforward. The hard thing comes into play where it's a series C and you need to put an inside round together to figure out what to do, et cetera. In those cases, we actually have the founder come back in and present to our full partnership. We are all up to speed on what's going on and we can check the founder because you're right. There is a bunch of emotional investment. There is bias involved. But if the founder comes back to us and gives us the story, we're able to poke and prod a little bit.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“That doesn't tell you have you used AI to provide a high margin service, right? You can sell a lot of something, but if you haven't figured out a way to have a good business model around it, then it's not really product market fit. And this happens in consumer businesses as well, right? Where people sell a dollar for whatever, you know, $1.50 or whatever. And then like, you know, you're underwater from a gross margin perspective. The same thing can be true in AI-enabled services and all that can lead to a situation where you as an investor, you as a founder think, oh my God, I've got product market fit. You pour more cash and you don't.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Where it's like companies growing really quick, you can fool yourself into thinking this company has incredible a product market fit. But there's a couple different downside cases where you think you have it and you don't. One of the cases in traditional SaaS is you're selling a product to a very diverse audience who's all using it for different things. And so you think like, oh, I got product market fit, but the reality is someone's using your thing for this over here and another person, a completely different type of customer is using it for this. And so how do you figure out your go-to-market motion? How do you figure out your product development motion when all these people want completely different things? That's like what can help companies blow up. There's a second sort of dynamic that's now happening with these AI-enabled services companies where let's say you go out and say, hey, I'm going to be an AI-enabled accounting firm. I'm going to charge you 15% less in the incumbents and I'm using AI. And so it's going to be even better, higher quality, et cetera. So faster, better cheaper, et cetera. Well, yeah, of course customers are going to buy that because it's cheaper and faster and better. So you're going to grow really quickly.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, one of the big examples, like when we look back at failures in our portfolio over time, it's been when we thought there was product market fit, but there wasn't. The term I'm using for now is I'm calling it Mirage product market.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. It matters. You know, some of the secondary purchases, both in terms of actual secondary and like third and, you know, second, third investments that we've made in some of these winners have been huge, hugely important from a returns perspective. In retrospect, it's always hard to know because we've definitely made some really bad third check investments in companies that we thought were trending that didn't end up trending.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, obviously, to some degree, I do because we're still managing a lot of those positions. I think that if you believe that if you stay on the board and you're super active, then you do have more insight. The downside, honestly, is just time. Just taking away from new investments. There's huge benefit to the firm to have the connectivity to those incredible companies. And one of the thing that we've started to do, I mentioned last night at our walk, which has been pretty cool, is we've been funding really early stage AI companies, particularly within specific verticals, and trying to pair them up with these giants. And so if we pair you up with like a really big company that has great distribution and you can do some sort of deal, which may involve some equity where the big company gets to buy a little bit of the small company, but the small company gets the incredible distribution advantage of these massive companies we're already a part of. There's this beautiful symbiosis that has been playing out for both sides so far.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, yeah. So, to be clear, we excluded Salesforce in that analysis just because it was so long ago and also we made such a bad decision. That analysis is on the stocks we're managing now. Okay. It's the stuff that's currently public, including Zoom. Yeah, including some. Wow. Yeah, exactly. So, basically, what we're trying to say to our LPs is this is how good we are currently at doing this, over the past five years, we've been at managing our public stocks. And the answer is we made you $2 billion more than if we'd just given you all right now. Do you agree with you two billion?”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So the numbers are this if we had sold them all at lockup, we would have returned $2 billion less to our LPs. What's interesting, and this just is like totally coincidental, if we had sold all of our shares at peak price of whenever the peak price provoked for that stock, we would have made $2 billion more for our LPs.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure, but any guesses is to the swing between what we've actually done and peak price versus what we've actually done, and if we don't lock up.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“We could hold in perpetuity. We could hold in perpetuity. We've done that to some degree. Like in the case of Viva, we've distributed 90% of our position, but we still have a meaningful stake in it.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Case by case. But like we basically just took what we've done so far, like how much gains we've returned from those deals. And then the last thing we looked at was what is the value if we had sold at the very peak price of those stocks, which was often in 2021. Any guesses?”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So, the analysis was if we had sold all of our shares and all of our public companies at lockup, meaning like once the lockup expired, we sold it immediately. So that's scenario one. Scenario two is we did what we did. So what if we actually done so far? So basically our track record of selling.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. The nice thing is the vast majority of our investors are big charity foundations and endowments. And these folks aren't as concerned with I need cash right now. They really want us to maximize the size of the outcome. And we've returned, as I said, over $8 billion on $2 billion deployed to them. And so they trust us generally. We did analysis recently on how good we have been at the publics.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, we do. Every quarter that there's earnings, we do an analysis that's led by the sponsor. And in almost all these cases, we're still on the board of the company. And so we have insight information, which is the reason why we hold the position. If we didn't have insight information, we'd have no defensible reason to hold the position. But as long as we're on the board, we have that information, you know, we can hold it. And so the sponsor takes that inside information and basically updates the partnership and says, here's what's going on. And then we make a decision. And because we're on the board, we can only make that decision within a specific window after the announcement for legal reasons, obviously, of whether or not we hold, sell, et cetera. In some cases, we buy. So in the case of docimity, we were huge believers. We invested at the A, companied really well. We actually bought more at the IPO. And that's been a great investment. We've already returned 3x, you know, from where that was. But it's a hard decision because every quarter you look at and you say, okay, I know what's going on with the company. I don't know what's going to happen in the macro, right? There's all sorts of uncertainty in the macro, so that weighs into it.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So, very early, shortly after went public. Yeah, it was bad. I wasn't there. He was six? Yeah, exactly. I was young. But I was there for a lot of our, like, when do we sell Bill? When do we sell Zoom? When do we sell blend? When do we sell Viva? I've been there for a lot of the more recent years.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, we sold Salesforce too early. Like, exit matters. And that's something else that doesn't get talked about in enough adventure.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so both of those are true. So we've been around for 20 years. We have deployed a little less than $2 billion in capital. We've returned in cash a little over $8 billion in cash. And that doesn't include all the private holdings, obviously, that are worth a lot more. The reality is the bulk of that $8 billion has come from a handful of companies. And so the outliers really have driven those returns. But what's interesting, as I said before, is even if you did remove some of those outliers from some of our funds, they would still be top decile funds because of those the choruses of the world. They get bought for 500, but you invested the seed and so it's still good money.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Comes back to that what you have to believe framework. So if you have to believe this investment work from the fund. And ultimately, if it's a low ownership investment, but we think this company is going to be Salesforce and it's not going to be super dilutive going forward, there is a ton of capital going forward and it can return the fund, then we'll do it. This is a game of outliers. And you have to convince yourself that this one's an outlier. I mean, you have to convince yourself that all of them are outliers, but the lower ownership you have, the more the owners are.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Comes down to the topic we talked about before, which is focus. So most multistage firms treat their seed programs as an option program. They write small checks. Often it's their junior people writing these small checks. They use it as a way to track the company to see if it breaks out. If it does, then they try to pour in and get proper ownership. That's the way most seed programs are run in multistage. And it's not great. It does provide signaling risk. It also doesn't help the founder as much because they don't get much love from the firm. The way we try to do it is the same we try to do everything else, which is with focus. So when we make a seed investment, we treat it like a corvette. It's a partner that's doing the deal. We're generally owning double-digit percentages so that we really care. It also allows the founder to raise around from someone else if they need to because we already have our ownership.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So unfortunately, I've been part of a lot of boards now with Orphan deals, where an original investor who made the investment leaves the firm, and then that company doesn't have support within that firm. So when it comes time for a new round, time comes the prorata, the odds that you're going to get it are lower. All of a sudden, that founder has to start to scramble and figure out what do I do. Or a new person comes onto the board who maybe is less constructive than the person that was chosen by the founder, and that could have negative implications. There's so many ways in which the founders can feel kind of tricked as in the right word, but it's like they signed up for something, it's not what they bought. When you buy an investor, like when you buy a board seat, you're really hoping to buy that firm, but also that person, right? These journeys last a decade. You're hoping to sit across the table for that person for a decade plus, and you kind of know that's why the vetting process is so important. That's why I flew to get sunburned in Denver and, you know, with Alex, et cetera. If there's a merry-go-round where people are leaving, it sort of strands these founders without the person that they originally wanted.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“That retain Kerry after they depart. And as a result, if you're really good and you pour your entire career into something, you make great investments, you don't ever get to capture a portion that's fair. And so what you're seeing is a merry-go-round in venture capital. And what that means is that you've got a bunch of people that leave. They go from firm to firm or they start their own firms because of these dynamics. It is really, really bad for our founders. Because what happens is these founders become orphaned deals.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So I'll explain how most venture firms work and I'll explain how we work in the difference. So, the way most venture firms work is when you're looking to hire investors, you hire two profiles. You hire either seasoned, often ex-CEOs into the business who have presumably a great network and a great brand and what have you, and or you hire an army of junior people and you give them a checkbook and you say you've got two years, prove to me that you're good. And the incentive that creates is those people write as many checks as they can. Of course, that's the incentive. And at the end of the two years, one of two things generally happens. It's almost always never enough time to really see if these investments are good or bad. And so the person often leaves. They either leave because the firm says these investments aren't trending, so you're out, or the investments are good and the person looks up and says, you know what? If I build my career here, there's no chance I'll ever be an equal partner because that is how most firms work. Most firms don't have an equal partnership. Most firms have found...”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Good question. My guess is there'll be a little bit of a trough of disillusionment, just like there always is in technology adoption. Everyone's trying everything right now. The good news is there's a lot of movement from experimental budget into real budget in these enterprises. But the bad news is a lot of these companies that aren't actually delivering it during value are going to get cut and there'll be some buyers who say this thing didn't work as well as I want. So I'm a little disillusioned. The other thing that could happen is there could be sort of an FTX moment in B2B AI as these agents come out. These agents are incredibly powerful and they do things for you. They send emails. They buy things that they can take action, which is very powerful, but with great power comes great responsibility. And it's very possible, in fact, likely, that some big enterprise is going to deploy an agent and the agent's going to do something really bad, right? They're going to send a bunch of emails to customers or prospects that they shouldn't. It's going to buy a bunch of things that shouldn't. It's not hard to imagine what could happen. And there could be a bit of a backlash to say like, oh, wait, this isn't good. We shouldn't.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Such core workflows. That's not the one I short. If I were to short a stock publicly, it'd be IBM. IBM still makes so much money from selling these refrigerator-sized mainframes. I think the thing that people don't realize is that 75% of the Fortune 500 still run their core applications on refrigerators in their closet. It's written in a language called COBOL that no one writes anymore. And IBM makes a ton of money selling maintenance and new servers every year, billions of dollars every year, to support these massive companies and their legacy code. It's been trapped on these machines and AI is, I believe, the critical enabler to get this spaghetti code into the cloud and hosted in a much more efficient manner. And so if companies like Mechanical Orchard succeed in doing that, the IBMs of the world are in trouble.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So, I think that the incumbency advantage of Salesforce that we talked about before is very real. The fact that millions and millions of people use that product every single day, you can't underestimate that.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“So, what I've seen thus far, and it's still early days, is that most buyers of this stuff aren't firing people. What they're doing is not hiring new people. And so they're trying to be more efficient with whatever they currently have. Like I just invested in a voice AI company in healthcare. And we talked to a bunch of their customers. The customers were like, we love this thing. It's amazing. And we're like, okay, great. How many headcount did you reduce? And they're like, none. I'm like, wait, why do you love this thing? And he's like, well, I love it because I've grown my business three times with the same headcount. And so I think right now, and I think part of its emotional people don't want to fire their people understandably, businesses are able to grow more efficiently than they were in the past because of this stuff. And therefore, these software vendors should be able to capture some of that labor.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, that's right. Particularly if you're really good at solving a problem and if the pain point is really big, if the pain point's really big, you not only have customer demand for it, people are willing to pay a lot of money for it. The other thing it's true is in the AI era, a lot of these businesses are able to capture some labor spend in addition to software spend. And so that narrow wedge, while it may be narrow from a software spend perspective, may not be narrow from a total spend perspective.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, and then they became the board level vendor to the world's largest pharmaceutical companies. And that's a really important phrase I think most startups don't think about. How can you become so important to your customer that you're discussed at the board level? And if you achieve that, your ability to upsell is obviously much higher. And so Viva is now upselled all sorts of stuff to these massive pharma companies and has a $35 billion market cap as a result. The same is true in the AI era, right? If you're building an auto-complete tool in Gmail, if it's a horizontal tool, yeah, you're probably going to have your lunch eaten. But if it's for a very specific use case and it works really, really well, you earn the right theoretically to expand to sell that same buyer some other thing. So you can use it as a landing wedge. and then expand to sell something that perhaps is more defensible.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, this is where I go back to solving a narrow problem. Like, start by solving a narrow problem because Google's not going to solve that narrow problem as well as you will. And you can expand from there. I mean, Viva is a great example. When we made the investment in Viva, a CRM for pharmaceutical companies, the entire market for that was $400 million globally. That's not big enough to build a multibillion dollar business.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source
“That incumbents will be able to accrue most of the value. The reality is it's still early days in this game, and things could change, but thus far, the startups are outpaid, the focus startups are outpacing the incumbents. The growth ones, it's more of a mixed bag for lots of reasons. There's ones that are a little more ossified and aren't necessarily taking advantage of this stuff. And there's ones that are still young and dynamic enough to actually pivot and take advantage of it.”
2025-03-10 · The Twenty Minute VC · 20VC: Lessons from Investing $2BN and Returning $8BN in Cash | Why Most Venture Partnerships are Broken | We Sold Salesforce Early and Lost Out on Billions | Are The Best Deals Always Expensive and Competitive with Jake Saper @ Emergence Capital · IDENTIFIED FROM THE TRANSCRIPT · source