YouSaid · the spoken record

John Frankel

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25
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2016-04-27
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2016-04-27
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  1. “And then we're discarded because someone else was hired for that department. But they could have been very good candidates for other departments, but the other departments didn't know. So Wade will talk to all the candidates, Wendy will talk to all the recruit recommendations. Hey, this person didn't apply here but may be suitable. It's a really interesting application of AI to a mundane space that we think can add enormous value. It's a killer team. And I think as we get into this company will become more prominent.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Okay, so we invest in a company called Wade and Wendy. I think we took the first meeting that drew us and the CEO had with BCs. And in that meeting, we gave them a term sheet and renamed the company. I think it was in the same meeting. It was called a different name, which was very sort of technical around the recruiting space. We named the company after the two AIs, Wade and Wendy. Wade talks to candidates who are looking for jobs and helps build candidate profiles. And Wendy talks to recruiters. And the problem it solves is the problem. I'll give you an example. At Goldman Sachs, we probably did a million interviews a year across the firm for what were probably 5,000 jobs. And there are many able candidates who got put down a funnel to have given”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “This is someone you don't know. It was a guy who unfortunately passed away about 15 years ago. He was a really good mentor and friend of mine at Goldman Sachs. Dick Groper, and he had to go through life with that name and he became an incredibly funny, engaging person. He would light up the room. And he really taught me that you just can't take life too seriously. And you have to be able to be accommodative across many things you do with people. I've still got many sort of fine memories of things he said and did that have sort of just become tokens for me to sort of refer back to from time to time.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “I don't really have a favorite. I tend to open about 20 tabs at the same time. Hacker News is my default open page, but I read Fred Wilson's blog, Mark Suster's blog. I think there are a number of VCs who put out some really interesting content. And then as people tell me of good stuff, I added to the list and things I stopped reading over time, I take them off”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “Is a very powerful concept, and I think there'll be some very big businesses build over time. And I still think we're still in the second innings of this space.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Well, we're investors in Indigogo, and I'm not familiar with the other company you mentioned. Kickstarter, can you spell that? Look, I think Indiegogo has been an innovator in the space and has a desire to go public and be a utility platform to change the funding for the world. It's not necessarily a winner-take-all space. I've heard people describe Kickstarter as becoming the Friendstopa space, but I'm not really seduced by that argument. I think that there's room for more than one platform and their models really are quite different in their approach. But I've met up with the team at Indiegogo recently, very constructive on the strategy and what they're doing. Both of these companies and others in the crowdfunding space are revolutionizing funding between people who have ideas and people have money without mediators. And I think that.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Oh gosh, it's the accidental superpower and it talks about the US in the 21st century and how the US is likely to dominate.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “It is and it's kind of interesting. I mean, if you look at the public market, there are people who invest over a two to four year time horizon. There are people who invest over a two to four month time horizon, two to four weeks and probably two to four nanoseconds. So there's all different types of investors. I think that they have a really interesting strategy of being sort of not following on sort of the one and done approach. We like to concentrate capital on winners because we believe that we can have some sense of which companies are doing better than others and therefore concentrating our capital in. But look, they're very successful investors and I think they have a valid strategy. We just have a slightly different one.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “It's kind of interesting. We often find that the hot deals where everyone's scrambling to get in, where they raise the round size and they raise the round price, they prematurely scale and they're often challenged as the company approaches the next round and the like. So we're great believers of starting off lean, iterating, getting a really good sense of your model before you start to sort of pour serious fuel on the fire. Because elsewhere, a team of four or six is easily manageable. Your team of 12 and you're in the wrong business, you have to pivot. It becomes expensive. It's very tough to do that successfully. We've seen companies do it successfully. You kind of want to avoid that situation.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “Well, in an ideal world, I'd be two inches taller, but I'm not sure I can achieve that. And in the same way, if you raise too much capital, it'll be too dilutive that you won't be enough. So, you know,”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “The easy money and the easy choices dry up. The worst companies we've seen in our portfolio have been the ones that take three, four years to get to revenue, three, four years to get to prove their ideas against customer engagement. We're trying not to do that anymore.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “It always varies and it can come out of problems and issues companies have. Usually companies pivot too late. Usually when it fails, it's because they pivoted too late. They stayed with the wrong model too long. And look, ultimately, at the early stage, you're really trying to get your hands around what you think the world's going to look like five, six, seven, eight years in the future, and where you think consumer behavior and demand would be. Our belief is you take some bright people, talented people, you give them some resource, you give them a couple years to sort it out, and they'll work it out. Sometimes you're just wrong and there isn't that opportunity set there. And, you know, this is a business where there's a lot of wrongs and a few rights, but the few rights pay for all the wrongs. But usually pivots happen a little bit too late. And they usually happen out of desperation.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “The oxygen out the room, it also helps them to position themselves as a certain type of company and hire a certain type of talent. Both of those things, when done right,”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “The best time to raise a lot of capital is once you've solved a lot of a problem. So you don't prematurely scale, but you scale into a business with known numbers. That's usually around about the series A to Series B stage. At the seed stage, the reason why you might want to raise a chunk of capital is because you have a business that is more capital intensive. And the fact that you've raised the capital creates a barrier to entry and allows you to be a consolidator of talent and resources. There are those opportunities, but they're rare. If you look at the company which were not investing like Slack, raise enormous amount of money out the gates and have continued to raise money at higher valuations. And they see that as part of basically saying, you know, we are the 800 pound gorilla in this space and you've got to be very well capitalized to compete with us.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “It's funny, there are certain things that become very evident in the business that you can raise too much money at too high valuation and then box yourself in for the next round. And I think every case is different and separate, but I think part of it is we try to invest with people who are looking to build enduring businesses. And if you're looking to build enduring businesses, there are ways to optimize that. And sometimes raising capital at high valuation is a way to optimize. And sometimes it isn't.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Get funded in good funding markets and sometimes bad companies pivot into being great companies. This notion that everything is very clear at the get-go and you can tell the best outcomes in that first round, it's a very tough proposition and it's not necessarily obvious and often the companies that find their first round tough to put together have the ideas that are enduring and build businesses that last.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “A lot of companies at the C stage just don't get funded, whether they're good or bad companies. And I think what this has done is kind of interesting. The equity markets, the public markets sort of fell out of bed and then have kind of recovered since the beginning of the year. The private markets have not paid any attention to that recovery. And so I think it's become one of these sort of reflexive moments that can happen in markets where there can become a self-fulfilling prophecy of everybody taking two steps back. And that's what I think happened here. Everybody took two steps back. And then they said, oh, everyone else took two steps back. You know, we're going to be able to invest at lower prices into better companies, et cetera. And it fits a narrative. And we'll see. But, you know, generally good companies get funded in good or bad scenarios. Bad companies.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “There's a narrative that fits that story, but I think the story is a little skewed. And what I mean by that is we look at two to three thousand companies a year and we end up investing in 15 to 20. And pretty much every DC does that. We've seen consistent high-quality companies throughout our existence. And we think we've invested in some great companies throughout our existence. In the last couple years, there were just some stupid companies raising money at stupid valuation. And when I say stupid, they're just ones where the risk reward didn't make sense. Maybe some folks got a little lazy. Maybe some folks were more momentum driven than were investing because, you know, five people they know well were investing. But those who are more value-oriented, who just sort of step back and look at the opportunity set in front of them, didn't get sucked into that mind.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “You can do it quickly, or you can do it slowly. We like to do it slowly. So, the quickly way is to invest in 100 startups, hope one of them becomes a household name, and say, oh, I was the first investor.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “I mean, the funny thing is, needles are passive. Entrepreneurs are not. They look for the best sources of capital. We like to consider ourselves in that group. As I mentioned earlier, we have about 30 people. So we bring a lot of intellectual capital alongside our financial capital. And we have some pretty good companies in our portfolio. And people like to be associated with pretty good companies. So you put the two together and it becomes self-reimporting.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “Startups and entrepreneurs because of very low cost of capital are able to bring efficiencies to many industries and the technology has advanced to a place where those efficiencies can be applied into creating very high growth disruptive companies. I hate to use term disruptive, but it actually does apply”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “This is where the growth is in a zero growth world. I'll try and give you a 30 second macro synopsis of how we got here. The Fed has consistently cut rates over the last 16 years to solve problems brought about, to be quite honest, by low rates, and is now stuck in this circle sort of consuming itself and the rest of the economy. People have become to believe that the rate environment we're in is normal, but we're really through the looking glass. At some point, we're going to have to smash back through the looking glass to some sense of normality. It'll be ugly when it happens, but no central bank or government has the stomach to get us there. In the interim, they've created a world with zero growth overall that's unevenly distributed.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “So, I mean, I think there's a couple of things there. Firstly, yes, the cost of starting company approach the costs of being unemployed, which is pretty good because a lot of millennials are unemployed. I think it's pretty much bottomed out. I think we've pretty much taken most of the OPEX, or rather most of the CapEx involved in starting a business, making an OpEx, not sure it goes down much from here because now you're down to people costs and real estate. And unless we have another significant recession, those things aren't going to move. The secular drivers are pretty strong. So I think it's bottom down, number one. Number two is this is a space that is a fraction of a fraction of a fraction of a fraction of investable assets. And it punches above its weight with regard to headlines. And to be quite honest with regard to impact on the economy.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “In the U.S. pretty much since 1990 or so. In fact, 799, I started angel investing and was fairly successful at it. It was something you could do whilst a Goldman and it was diversified away from all of the market risks that everything you did as being salesman on the trading floor would involve and just felt I had an actor. It didn't take up much of my time. But when I left Goldman in February 08, I decided to sort of take things professional. Alex Katz, one of my partners here and I started the firm in November 2008 and we're now, I guess in our eighth year, about 30 people, 150 million AUM. Really enjoying what we're doing. We've got a certain sort of pace and style to our approach to venture capital is a little differentiated.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “Wow. Well, thanks, sir. Describe me as one of the leading VCs. Origin story is very simple. Graduated from Oxford, too many moons ago that I really want to think which year it was. And we've no idea what to do. And like most people who graduated Mox had no idea what to do down the route of becoming a chartered accountant. Quickly qualifying realized that was not the best place for me to be spending my time was hard by Goldman Sachs in London, which was an unknown firm in London back then, somehow was that the firm for about 21 years doing various roles, helping build various businesses for the first half of my career there, for the last 11 years was on the sales and trading floor covering hedge funds and got to work with some of the smartest money managers. During the period I'd moved from the UK to the US.”

    2016-04-27 · The Twenty Minute VC · 20VC: Why Every Successful Company Pivots and Good Companies Get Funded in Good & Bad Markets with John Frankel, Founding Partner @ ff Venture Capital · IDENTIFIED FROM THE TRANSCRIPT · source