YouSaid · the spoken record

Matt Ocko

lines on the record
25
first
2016-08-08
most recent
2016-08-08
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1
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podcast

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  1. “You're speaking to your connectedness and expertise that you are one of about 37 people outside of their customer base that's been.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Up to a huge chunk of the Fortune 100 addicted to their stuff, and they dwarf the footprint of Ariba and any other would-be competitor. And the wonderful thing about them is no one except their adoring customers paying them a ton of money has ever heard of them.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “So follow on threescan because they are transforming both drug development and medicine by delivering a 3D map from the subcellular level all the way up to complete organ systems a thousand times faster and with essentially infinitely greater accuracy than human pathologists. So that's a follow-on that we recently did. A de novo investment you might have seen is one called trade shift which is a company applying some very interesting machine learning techniques to massively reduce fraud and friction in the global supply chain. They have almost a million discrete companies in 140 countries worldwide from tiny companies in China.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Probably I rely on the synthesis that I get from Nuzzle, Jonathan Abram's just fantastic information utility. But I would say within that subset, there are probably a handful. Science and nature MIT technology review the internal magazines of Carnegie Mellon and Stanford and Berkeley. I try to read as much as I humanly can because every now and then there's a little nugget there that either validates something that we're doing or says that we're being idiots and we need to change course.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “There are a handful of founders who are not only superhumanly brilliant, so they process and execute on information an order or more of magnitude faster than you and I. I'm happy to have a few of these founders in our portfolio. They also tend to be supremely Ordinary humans like us can't respond to the demands of a truly successful startup, one that has this hard sharp arc of takeoff and sleep eight hours and cook our own organic breakfast and get in a brisk six mile walk and then write a little bit of poetry for the significant other before ambling off to work.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “I would with a joking but ever so slightly sincere rejoinder say that our returns speak in favor of my strategy and not hers.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “My favorite book is a large volume called The Way Things Work, recently updated by the great architect, illustrator David Macaulay. I love it because it's inspired me since childhood and continues to do so by showing intimate details of a huge panoply of human innovation. It's like a history of human genius all laid out in front of you. And I love sharing it with my kids and on a rainy day. I'm always still happy to open it up.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “A hard, paid up front bookings backlog of $600 million isn't quite ready to go be a victim of aggressive short hedge funds in the public market yet. I mean, I'm being a little snarky, but that's the kind of company that broadly speaking, I would like the freedom to see become an arm, you know, at least go public and or exit for 25 or 30 billion US or whatever the currency adjusted outcome there was, or a Qualcomm or an Intel with market caps north of $100 billion.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “We haven't done the final, final numbers, but we ask our companies, we measure our companies not by net promoter score as one of our colleagues talked about, but by how much actual revenue they're making across how many durable fortune 1000 customers. These to us are the signs of a company marching towards primacy. In aggregate, in just a couple of our early stage funds, our companies have hard contracted gap bookings and or fully recognized gap revenue approaching what should be about two billion dollars in 2016. Do I sell positions in a panic to secondary funds? Do I turn off the lights because a company with $150 million of profitable gap revenue and a”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “I think that the realization of maximum value from a successful investment and traditional fund lifetimes are beginning to invert. And as much as LPs like to talk about perennial shakeouts in the ranks of managers, I think that some LPs who over time are uncomfortable with perhaps a 15-year or some of my VC colleagues have quietly mentioned maybe the equivalent of a 20-year long bond inventure. Those LPs may not be the right ones to go forward in the early stage venture communities.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Companies are bad, and we all may still be using Facebook in a hundred years, but companies with 40, 50, 100-year durability, whether it's a GE or an Intel or a Qualcomm, which seems to be marching towards that, Cisco and Microsoft, which are getting very close to hitting those kind of durability milestones many, many decades, and tens of billions of dollars of value, those aren't fully realized inside a 10-year fund life, 12 at best with two petitions for one-year extensions by the manager to LPs. And with companies, especially the kind of deep tech companies and companies in general, whether it's Uber or Airbnb, running out the clock on an IPO as long as humanly possible.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “We gently tease our limited partners. They are by and large extremely patient, extremely far-sighted people whose trust in us and whose generosity we are incredibly grateful for. But we tease them occasionally when, as Chris Duvos, one of our LPs, says, where's the Mula in the Cula about mild cognitive dissonance between LP chest beating over 20, 40, 7, 100 year time horizons, and also being anxious that they haven't gotten all their money back inside three years? And again, our LPs are actually very, very good about this, but industry-wide, that sort of mental conflict is a real one. The fact is, in deep tech, in sustainable franchises, not consumer companies, not the consumer.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “We're a little unusual in that we have a meta thesis through which we view the world, but to your point, we don't have an industry or sector thesis. Our meta thesis, the thing that we want to see in any company is that they are exemplifying the use of compute and novel highly defensible algorithms to themselves be capital efficient, whether they involve hardware or not, so that they have longer runway, more bites on the Apple, more control of their own destiny, and for their customers are capital efficient. So they deliver higher ROI, they have more control over margin.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “Right, Josh Reeves, phenomenal entrepreneur, Tomer London, his co-founder is one of the best product and engineering people. We know, now renamed Gusto and thriving, we didn't follow on. We didn't raise our hand to be the big dog in successive rounds. And it had nothing to do with the quality of the company and people trust us when we explained that because the company was a wonderfully engineered great SaaS company delivering value to customers, but it was not a deep tech company. Our thesis as the company grew no longer applied to the company. Everybody who's invested in gusto slash end payroll at almost every stage so far is going to make a lot of money. We're grateful we had the chance to participate, but I think everybody also respects that we are relentless about our Thesis.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “There's no economic urgency to extract additional equity from the entrepreneur out of the opportunity fund just for the sake of doing so. So I don't think the opportunity fund carries any signaling risk. A fair question is the obverse, which is, is there signaling risk when you make a seed investment and then you don't follow on? I would say in our case that is relatively minor. We are brutally frank with all parties, including the entrepreneurs and the folks upstream about how we make an investment decision. Also, when we're not interested in following on, we're extremely transparent. And I think people understand that not every company is for us by way of example. We were very early investors in a company called ZenPayroll.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “Well, first of all, I don't think that our peers expect us to always follow on from the Opportunity Fund because sometimes companies do well enough that they don't need money from the Opportunity Fund or sometimes they're growing at a pace where traditional financing is sufficient. We'll get into this in terms of life cycle. These deep tech companies across sort of the horizon of a vintage and sometimes folks show up at our doorstep. We're friendly with almost everybody and co-invest quite happily up and down Sandhill Road and say, look, XYZ company crossed our threshold. We've done some work. We really want to be the folks to write a 20 or 25 or 30 million dollar check. And since we've already achieved reasonable ownership up front,”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “blindly dumping money into a sector at increasing expense, if we've made a mistake, and we're certainly not infallible, we can move out of the sector or move into an adjacent sector that looks like it will be more fruitful. As we go through this process, we are concentrating down on our winners so that in a hundred and fifty million dollar canonical early fund, we may have 10 to 14 positions that we've dubbed our core positions at most, which looks very much like a traditional venture capital portfolio, but we got there with a much greater degree of insight than has traditionally been possible.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “Advantage. We can invest, obviously not in conflicting companies, but in companies in the same space across almost all interesting companies in a space early for fewer dollars at risk than one beefy late A or early B investment by a larger fund as those are traditionally done. And the ability to watch all of those teams in entire sector interact, pursue customers, develop their technology, recruit, deal with incipient competition, adopt innovation elsewhere as it happens, achieve product market fit, and so on and so on and so on gives us huge insights into not just which individual company is going to be a winner, but the entire sector as opposed to”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “So our Opportunity Fund is in fact contractually prohibited from chasing deals outside of our portfolio. So our Opportunity Fund is pure rocket fuel for things in our portfolio. That's number one. Number two, we voluntarily applied fairly strict limitations on valuation and performance metrics even in our own portfolio. We're not chasing vaporous or potemkin unicorns. Number three, there is an almost unitary LP position between our early funds and our opportunity funds so there is de minimis conflict. Number four from a portfolio formation perspective, we are investing as early as possible to achieve signal, to achieve information.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “Well, you raised this question later, and I don't want to steal your thunder, but that's one of the reasons that for many years now we have had an opportunity fund. When we see a young company showing exponential progress, when we believe that it could be a potential monopoly or member of an oligopoly and have appropriate impact and returns that goes along there with, we want to have the freedom to back that company. It's also the reason that we made a very conscious decision from the very beginning”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “Another three million or five million or seven million dollars is at least as good, if not better than the next guy up the line, especially if that next guy up the line is by necessity deprived of the luxury of time for making a decision.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “What is popular or acceptable or soothing to the late stage investor? That's where the societal impact comes in. You may not be doing the most interesting, highest returning, most societally or industry transforming company if you're worried that you can't get it past a larger investor. The flip side of this sort of information or signal reducing aspect is that who knows better about the course or velocity of the early stage company than the early stage investor ideally they've been going on customer calls they've been watching whether management is highly functional or slightly dysfunctional they've been seeing the evolution of the technology they have a weather eye peeled for any competitors I'll use the word advisedly in a perverse sense their adjudication of whether that company deserves”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “To essentially hold as fully populated and as aggressive an auction as possible, the later stage investors are now competing with each other on as short a time frame as the early investor can possibly make happen, which means their ability to do complete diligence and to have the most informed possible judgment is reduced. So that puts LP money in a later stage fund at risk. In a hot environment, they're competing on the order of weeks. In a slow environment for credible deal, it's still a handful of months at the very most. Meanwhile, the early stage investor, because they have to consider this capital formation risk, is at best unconsciously and at worst very consciously biasing the nature of the investments that they pick towards”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “I sincerely believe, and there's a large but quiet group of other experienced VCs with successful track records who also believe that the strict segregation of funds by size has an information-destroying or signal reducing aspect. Today, the earliest investors in a company, whether they're the micro VC or small seed or AFund who know the most about the company, have to basically hold a blind auction at each node or locus of capital formation as the company moves from stage to stage. What that means is that the later stage funds, because the early investor has overwhelming need along with the founders of the company to complete the round,”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “It's actually kind of a funny story. We were both at a mutual friend's birthday party back, oh, I don't know, seven, eight years ago, while now. It was in an underground trendy bar very loud, electronica music. The beautiful people were having a great time, but neither Zach nor I, nor in fact our spouses who were both there do loud. We all found ourselves in the quietest possible corner and over the course of that loud trendy party, Zach and I ended up sort of talk yelling at each other about our deep compute and big data investment mutual thesis. Got to be really close friends after that, started investing together out of our family offices. Out of our own money. And one thing led to another, and all of a sudden we had a successful franchise.”

    2016-08-08 · The Twenty Minute VC · 20VC: Data Collective's Matt Ocko on Why "All Fund Size Models Are Wrong" and The Lifecycle of Current Venture Funds Is Inefficient? · IDENTIFIED FROM THE TRANSCRIPT · source