YouSaid · the spoken record

Nigel Morris

lines on the record: 44
first: 2021-05-24
most recent: 2021-05-24
sittings or episodes: 1
sources: podcast

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“Can I just say look, so many of these conversations can be very dry and not terribly insightful. And what I've really enjoyed here is that we have a kind of sharing conversation about stuff that really matters. And if it's of use to your listenership in any way, hey, I'm delighted.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“See the accelerators in Mexico, so we're going to put that together. We've raised money from LPs, some of which we've mentioned already today in the conversation, and we're going to help start things out of the ground in Mexico.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“There were two that we've just done now. One is investment in BITSO, which we announced a few days ago. I've been a crypto denier. I don't get it. I can't predict if it's going to go up or down. But what I do know is crypto is a thing and people want it. They want to store it. They want to trade it. They want to borrow against it, margin lending. I need it in my portfolio to hit my efficient frontier, and I want to be able to move it across border. So what we've done with Daniel Vogel at Bizo is say we're going to really lean in and help you build out traditional, if you like, banking products around this new asset class called Bizo. And a lot of what I'm doing working with him is how to scale his business and helping him do that. For me, it's loads of learning about an asset class that I haven't really grown up with. And using leveraging things that I have done for many, many years. The second thing that we just announced recently is a startup platform, an accelerator, if you like, in Mexico City called Fontez, which is Spanish for Fountain. We see in Mexico lots and lots of talent, but we don't.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“My knees gave up on me. I used to run a lot, but my knees gave up on me, so I took up cycling. Maybe if you have that kind of cardio, maybe I can talk you into doing some riding.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Ever since I was a kid, I've been a fanatical exerciser. And I think that we talked about addiction earlier. I think this is my addiction. And so actually a more socially acceptable version of it. So I love to ride my bike. I love to exercise in lots of ways. And for me, it's a huge stress releaser. And I sort of track everything in a nerdy analytical way that you'd expect. And for me, it's great to be now, you know, in my 60s, two years ago, I took two of my sons, Dylan and Harry, and we rode up the Stelvio Pass, 7,000 foot two-hour climb in the Italian Alps. And it was absolutely amazing to be at my age and to be able to do that with my boys. So I was going to do that this year. COVID means that I can't, but I'll hopefully stay fit enough to be able to do it next year and be able to do things like that.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“While I love all of the boutique fintech venture firms, so Mickey Malkitt said dear friend, Matt Harris again at Bain, Hans Morris at Nika I've known for 30 years, and then the mainstream, you know, the really great generalist, Sequoia Andreessen, Axel, Benchmark, I see them all doing really good work. As fintech has become a thing and not just a fad, we're seeing the mainstream firms really invest in that. And although they may not have come out of operating routes and no financial services in the way that somebody like QED or Rivet would know, what they bring is an enormous other assets to the table in terms of scale and brand and reach and lots of other things.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“The people that I've had the best time with when I've been through ups and downs with them and I've been in the foxhole with them, and you see how they really react and seeing how they stand up and change the course of outcomes. So, you know, I point to a couple of people. I caught Matt Harris at Bain, I think is a total mench and a superhuman being. I love him dearly. And then Philip Reese, who used to be a senior Amex and I'm on a number of boards with him, I learned from both of them all the time. But innumerable others that I've been able to grow and learn with.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“There's a lot of really boring people in it, Harry. I want people quirky, funny, orthogonal, stimulating thinking people. I'd love to see more of that. So many of us come from this classic went to business school strategy consulting, people like me in a way. So challenge the edifice one and two, the degree of diversity is really a huge opportunity. We've worked hard on it acutely on the gender side, and I think we have to really continue to work on it in terms of people of color.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Favorite book is Leadership the New Science by Margaret Wheatley. And what she talks about is the old method of sort of Newtonian physics doesn't work in a world of chaos and complexity and having to move really quickly. And what she talks about is how do you create teams in chaos? And she talks about how it requires different spans of control, different ways of managing people, and different ways of driving results. The second most interesting book and the really fun one is a children's book by Peggy Rothman called Officer Buckle and Gloria. I used to read to my kids. And what the punchline of that book is that you need to have people with you to build value. And the officer buckle is this boring old policeman and Gloria is his dog. And when they're together, they are magical. And when they're separate, they're really boring. So have a partner, build partners to build things together. That was Rich Fairbank in Capital One, and it's been Frank and Bill in QED.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“To figuring it out is much longer, so they've cracked the code there and then are building the debit out. Chime started with debit and will build out the lending site. But the challenge of building out all that apparatus is that it's very hard to do. You have to have patience. Your venture investors have to understand how hard it is and have to give you the rope to do it. But it can be done and they have a competitive advantage because many of the entities that I've just rattled off have net promoter scores that are in the 70s and 80s and have the focus on meeting the customers' needs where they are rather than trying to get you to go into a bank branch and try and cross-sell you stuff. So the canard of cross-selling is in the old orthodox world, in the new world of digitalization we will see the best challenger banks and entities make cross-selling work and you will see the new banks of this world have student lending and asset management and a full vista of different products.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“So he's thought through how do you make cross selling work? So cross selling can work and current are doing it one of our portfolio companies doing a nice job of it. We're seeing Chime build that out. But, you know, it's much harder than it looks like on paper. So that's my first point. Secondly, we will see that any company that starts with a wedge product and gets traction and the unit economics makes sense and they're building brand and they're growing. The next thing is, okay, what's the next product? How do I build that out? And so many of the challenger banks are en route to having to offer a full vista of consumer products. You're quite right in that. And the challenges, certainly in the US and in the UK, is that wherever you start, you don't have the skills to develop the other side of the balance sheet. Monzo started with a checking account and a debit card. Okay, new bank started with lending. One of our portfolio companies, Mission Lane, has started with lending. I posit that lending is much harder to start with because you take the gestation period.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Complex question, really good one. A null hypothesis here, Harry, is that bundling doesn't work. It's a canard. It's a ruse. It's a justification to buy things that doesn't pay off. And if you start with that assumption that you say, well, where's the exception that proves that rule? And I over the years I've been looking for those exceptions. Where are they? USAA does a marvelous job of cross-selling, but it's got a unique proprietary customer base with a unique commonality. Two, Wells Fargo did it really well, and a lot of that was quite naughty, and they got into a lot of trouble for it. Who else has done it? Newbank is doing it. You're exactly right. Why is Newbank doing it? Because the gap between Newbank and their offerings and the incumbents in Brazil is massive in size. It's a yawning gap between them. And, you know, new banks virality index was I've never seen before when they started offering the credit cards. So what David has done at Newbank is offer the right cross-sell product at the right time in a frictionless way, click and”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Can bring and leverage it through my asset base, my distribution channel, my low cost of funds, my ability to manage compliance and regulatory environment. That third one is the most powerful in my mind, but it takes a management team that's very progressive at the bank and forward-looking. And often what I see, Harry, is candidly people who are my age running the bank saying, you know what, this is really flipping hard. Going from an analog company to a digital one, that transformation is really painful. It will take years. You know what I'm going to do? I'm going to hand it off to my 47-year-old guy who's coming up behind me and I'll let him do it and I'm going to move off stage. So a lot of kind of can kicking that goes on. But look, if I'm running a big bank, I'm saying, look, this is something I have to learn how to do well and I have to be able to use in the jiu-jitsu of it again my assets, my assets of low funding base, lots of profits, footprint, brand, unique proprietary data. And now I want to make myself friendly and adaptable.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, here's what I would say, and I've been saying this for years to them in the boardrooms. I should say there are very few, if any, digital deniers anymore. Five years ago, the people were saying this is a flash in the pan, this is not going to work. We are better at technology. We have these customer relationships. Look, we've got all these branches. This whole fintech thing is tulips in Amsterdam. I think the very few digital deniers now, and very few of them now saying, look, we're going to be able to out-compete the plaids and the credit karmas and the squares of this world. So they're now in the mood to engage in a way they weren't in the past, but now they're struggling with how do they engage. It's very challenging. The building of a venture platform which they can easily do in many ways, you have to say, what's the objective function? Is it I want to make money? I want to get lots of X's? No. Do I want to go and learn? Maybe, but I have to then engage the whole corpus of my organization so it's in the mood to learn and I have to be able to feed the learning back to the core organization. Is it that I want to be able to take advantage of things that are fintech?”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“To me, a lot of it is about how the company's doing and what the team wants to do. When a team comes to you and says, we want out, we want to take our chips off the table.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“On True North and at the same time, you beat them at their own game. Now, that means that you have to look for ways to segment. This customer is better than that customer. Is it based on geography? Is it based on demography? Is it based on FICO score? Is it based on history? What is that based on? What drives the underlying slope, if you like, in the economics that the customer level? That's problem solving using data to do that. Because again, your hypothetical putative company that just got massively funded is not doing that.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“There's a thing called a just world hypothesis, and in the end unit economics drive P&L. And if your business is built on a house of cards and your unit economics don't make any sense, in the end your business will not succeed. And that competitor, albeit terrifically funded, all be them getting on all kinds of lists of being unicorns, etc. In the end, they will fall apart. In the end, the talent pool there will go away. So it's a short-run, long-run phenomenon would be my first comment. The second thing is when a competitor who might not be as vigilant in terms of unit economics is funded so aggressively, it's for you to raise your gain. Now you still have to stay true to your North Star, but you have to figure out how to compete with that and you have to figure out how to make sure you get better customers that have better LTVs, that have better revenue, because that's not what they're focused on. They're focused on brand building and just getting number of customers to shout about to their LPs perhaps. So you have to, in the jiu-jitsu of this, recognize that you stay focused.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“And look, any data point you have is only as good as when you capture that data point and on the population it was derived from. So yes, you're right. There's a first mover advantage. You get a bunch of low hanging fruit. The cost to acquire is really low. In time, you get better at branding. Yes, you get better at origination. Yes, you figure it out to do affiliate marketing. Yes. And those dynamics will move things around considerably. And when people realize that you're doing it, competition's going to come in and they will try and cherry-pick your best customers, which will erode your LTV rates. This is a complex dynamic of managing unit economics, and it's not done in your finance department. It's done by your best business people who speak the language of horizontal economics. And it's so critical. But yes, have it being really cogent and really thoughtful about the underlying dynamics at the customer level is really critical.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Now, we have seen fintech companies that have issued the whole notion of unit economics, hey, what does it matter? I've got a NEP promoter score that's off the scale. I can book customers for five bucks. I have no idea what the attrition rate's going to be. And you know what? I'm going to figure out how to make money down the road. Now that sort of land grabbing California Gold Rush mentality can work in certain businesses and it has worked in FinTech. For us though, that is far too much of a Promethean leap where you say I'm going to just get loads of customers, they'll love me, and then I'll figure out how to make money down the road. That usually ends in tears. It usually ends with down rounds, and then you're fighting this losing battle internally of trying to tell people why they should stay with you on the journey when the valuation of the company has just fallen in half. So unit economics to us are absolute building block of our investment heuristic.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, somewhere between C and A, you start to get some serious data. What does it cost me to acquire a customer? What do I think the LTV is? What do I believe the payback period will be? But in the Capital One days, Harry, the ultimate litmus test, the decision-making algorithm was all around union economics. And in the end, successive cohorts at the individual level in unit economics add up to the P&L of the company. And we joined those two phenomenon up. So for us, it is sine qua non that you focus on the unit economics. Now, and with each passing day, each passing week, you get more data and you get more clarity. Because we've made 150 investments now over 14 years, we actually have a good sense of here's one data point now we can extrapolate from that. If it's like this, it'll do this. If it's like that, it'll do that. And we can go on that learning loop really fast, really quickly, do lots of A-B testing so that we can actually test the limits and we can get a sense of the unit economics very quickly.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Of open field running to come. Now, does that mean that all venture firms will succeed? I don't think so. There's a lot that don't really have a lot that they bring to the table, per se. And we are specialists. We are very deep in what we do. That doesn't mean that we're always going to be successful, but our unique perch allows us to be able to be very discerning about what we do.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Equated what's going on now in some ways to the Weimar Republic of Germany in the 20s, in that you've got people running around with wheelbarrows full of money trying to buy a loaf of bread. Yeah, there's a lot of money out there and some of it is not incredibly discerning about where it puts the money. And valuations have gone up dramatically. That's absolutely true. You know, for us it's staying focused on the basics of this business, do the unit economics make sense. Are we solving a real customer problem? Can this technology and this team really scale? Can they sell the story? Can they attract the talent they need to build the business? But I've had the luxury, Harry, of being a strategy consultant in banking, being a banker, you know, in a public company and now as a venture for, and I have three unique purchase. So I see how challenged the banks are in being able to meet the needs of a digitalizing economy and how difficult is it for them to compete with the burgeoning fintechs. So I believe, actually, there's a huge amount.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Oh man, I do too. Look, I've been saying to my team the last few months, look, we've got this enormous growth in value in the portfolio from investments we've made in the past. And one of the things I learned very much was, look, it's never as good as you think it is, and it's never as bad as you think it is in the worst times. So get some balance, get some perspective. When you're climbing up the ladder, don't keep looking up. Look around you and enjoy the view. This is a great time to be in venture. The wind is roaring at our back. FinTech is winning. Digitalization is coming at us like a train.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“To executive chairman, and the relationship that you have enables you to have those kinds of conversations. And Harry, they don't happen in the boardroom, they happen outside of the cadence of the board meeting. So often the value that I'm having, if I'm having any at all, is not in the boardroom per se. It's actually in those periods between the board conversations and nudging and focusing attention on the key things. But yes, if I have a failing here, is that I do not give up. I am absolutely maniacally tenacious. And if I buy into something, I hate to lose the fear of losing and the pain from losing is much greater than the euphoria of winning. But you know what? I think it's better than the alternative. I see a lot of cutting, you know, you say, I see this with some of my friends in VC. They make an investment. They go to the second board meeting. The company's missed their revenue. And the very senior person is now substituted by the very junior person and the senior person is nowhere to be seen.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I'll take that as a point of development for myself, even at these advanced years. Yeah. And look, I think it comes out of being an operator. In the operating environment and you've got six or ten people working with you, you tend to spend more time with the ones that are not working. You tend to the ones who are failing. In venture, it's much easier to turn 4x into 5x than turn 0x into 1x. Clearly mathematically the case. But this is not about stock picking. It's not about just picking the team to go onto the field. Part of the quid pro quo of that really deep relationship is that you are willing to engage all the way through the journey from a seed to IPO and you can add value all the way through that period. Now that doesn't mean that you are just passively supportive. It doesn't mean that you are wedded ad infinitum in bondage with the relationship that you had at the beginning. Many of the conversations I'm having with trusted relationships is look, we need to sell this thing. It's not working. Growth is slowing. You can't be CEO anymore. You need to move.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“So we play the full 90 minutes, and the people who want to work with us, and it's your mutual mating process, are the ones who recognize that what they're attempting to do is really difficult. It's 0.9 to the power 6, and they need partners and supporters along the way that can help them navigate that. So yes, the ones that we want to work with want to work with us, the ones that just want the money and leave me alone, and I'll bring you back much more money, they're not the ones that work with us.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I messed around in a lot of psychology in my undergrad days, and there's a humanist psychologist called Sidney Girard, Canadian. He talks about reciprocity and disclosure being really important about building trust. So he has this notion that the stranger on the train phenomenon, you're on the train, there's a stranger, and she starts telling you about her life and her divorce and how her children this and that, and you're going like, hold on, this feels like weird because she's disclosing too much. But you build relationships by a stair stepping of incremental disclosure about each other and build rapport and relationship and trust around that. And I find that the people that we want to work with and the ones who want to work with us are willing to engage in that. QED is not about stock picking. We play the full 90 minutes user soccer football analogy there. We don't just pick the team to go on the pitch and let them sort of manage the next 90 minutes. My team, Tottenham Hotspur, does this regularly. You're 2-0 up at 30 minutes and you lose 4-2. It's really easy to do that.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Schools, they did really well, they went and worked for the right investment banks, there were consulting firms or startups, and now everything's gone really well. What are they going to do when they stare into the jaws of failure? Are they going to dust themselves up and guide it again? Or are they going to fold the cards up and say, I give up? Now, most of them, you can start to grapple with those kinds of things. Is that superior listening? Maybe, but it's not about just reading numbers off a page because early stage companies have no idea what they're going to do and therefore it's a futile waste of time. It's about really kind of getting to know the human on the other end of the hear the video pipe, but hopefully much more face-to-face down the road.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“What hasn't gone well? And if you could run the clock back, what would you do differently six months ago? Who are the people that you really trust on your team? And how do you know you trust them? Is the goal here to make money? Is the goal here to be successful? Is the goal here to make a difference in our society? What's driving you? And how do you trade them off? When you ask those kinds of questions in a supportive and non-adversarial way, pitching and building relationships and making decisions should not be running the gauntlet. It's not a chance to show off how clever you are. It's not a chance to rough people up. It's about creating an environment where you can really learn from that conversation and learn about the human being that's at the forefront, the spearhead of driving this business. Most venture investments fail. Most of the people you're talking to are not going to be successful. How do you separate, discern? How do you get a sense of who's going to win and not? And when they face failure, which they will, when something goes wrong. So many of the people have had charmed lives. They went to the right.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“So many of the people that come in with pitch decks, and by the way, we're in Alexandria, Virginia, Harry, and nobody rides their bike to pitch us. So we have to do a lot more outreach. We have to build a lot more relationship. And we spend a lot of time with companies that we'll never invest in. But we're building the ecosystem and we're being supportive to the overall environment, the agar jelly of fintech investing. And we're very happy to do that. So first of all, you've got to create the right ambience where people will have a conversation with you in a way that's meaningful where you get incremental, nuanced signal from the conversation. So it's not like talking to a robot. You don't ask a question, what do you think your revenue is going to be in six years? They have no idea what the revenue is going to be in six years. They can't even predict what it's going to be in six months. So don't ask silly questions and set up a sense of what the nature of what the conversation is going to be, which is going to be about important things. Harry, I think it's a really interesting business. Why are you doing it? Harry, what's important to you here? If you look back on the last six months, what's gone really well?”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I get my nourishment from palpable, genuine relationships that I build en route where I can help people half my age, twice as smart, but haven't been through the slings and arrows of misfortunes and mistakes like I have, helping them navigate that, being a coach, being a steward, being a support, being an encourager. Those things drive me now, and those things are much more important than pound shillings and pence. Now, I do want to say I am really, really lucky. I don't mean to sound like...”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“So, look, you know, a working class grammar school boy, Welsh parents growing up in a household where everybody read the Daily Mail, and I don't think there was a book in sight. I've been incredibly lucky in that I've been able to create escape velocity economically for myself and my family. And in the early days, it was about just having enough money to be able to travel a little bit and not to worry about money. The basic Maslovian stuff of feeding the family. And then it was getting to FU money, whatever that is. And we can debate what that is. Maybe it's 15, maybe it's 20 million bucks. And I think once you cross that threshold, it doesn't matter anymore. Whether or not my latest investment, and we just invest in BITSO, for example, in Mexico City, I love that business and I think it's going to be a rocket ship. But candidly, whether or not it does brilliantly or does well is not going to change my life at this point. So the relationship with money has changed substantially through time. I don't get my nourishment from more zeros at this point.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“So it's really difficult. So, I find myself constantly challenging myself about is the hypothesis correct. We're very hypothesis driven what we do at QED. How do I know what is true and how do I know what is yet to be proven? And how do you deal with that? A great deal of the strength I get and the confidence I get is being around people that I love dearly and I trust implicitly in Frank Rotman and Bill Salufo and so many other people that have come on this journey with me. I think if I were alone making decisions by myself, Harry, I think it would be much, much harder. So they are crutchers and they are advisors and we all join arms and jump into the river together. No matter how successful you are, actually, no matter how many pound shillings and pence you've got, insecurities are going to be with you forever. And if you seek out places where insecurities are more likely to haunt you, such as venture investing, it's something you just have to deal with.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“What do I know? I got an entrepreneur with an idea, particularly at the early stage. And how do I evaluate that? Now, that means that I think it's what I call the 0.9 to the power 6 problem. And that is that when you think about all the things that can go wrong, each one of them separately is not problematic. Can you build the team? Is the TAM big enough? Is there a compliance issue? What's the regulatory structure? Can you fund yourself? Will you be able to get the A round done? These are all very solvable, but then you have to make them all line up as conditional probabilities. That makes it really uncertain and capriciously difficult to predict. With that is the uncertainty and the stress of this job, because you have to make decisions on very, very little data. People joked with me sometimes and he went back to my consulting days and I saw you're drawing regression lines through a single data point. And sometimes there isn't even a single data point. And that quality of the signal you get in a COVID world has been diminished significantly. I can't feel the human being on the other end of the pipe as well.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, look, I've been really, really blessed and really, really lucky, and I've surrounded myself with people who are immensely more talented than me and built great relationships with them. And I've had a really good run. But every day I get up and say, you know, what I'm trying to do here with QED and having the responsibility of managing now over a billion dollars under management is not easy. And venture is much harder than running a big public company. Because if I have a big public company, next year's earnings are already in the bag, largely. And if I can reduce cost by five percent and if I can grow at 10%, then I'm going to get my bonus and everything's fine. And you have an edifice and a cadence that's already fully up and running. Running a large company is much easier than running a smaller one. Private equity is much easier than venture. I've got numbers to look at. I can dial in what the revenue is going to be next year up and down a few percentage and I can manipulate that on a spreadsheet and out comes different answers. Venture is about extracting enormous signal out of very little data.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“and drug addiction. And what he says is, look, if you bring it out into the open and you really understand that this is a disease, but it is not anybody's fault, there's help out there that can massively change the trajectory of outcomes. If you just do that, you can make a massive impact. And our world of venture, of entrepreneurs, I think is replete with people who are going through these kinds of difficulties, even without COVID. And 80,000 people lost their lives in the last 12 months as a result of addiction. But this is so important and it's so important to bring it out into the open in the workplace. So me and people like you, thankfully, Harry, talking about it in an open, disarming way destigmatizes it. And that is so important.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“arm or sore shoulder, I'll come into work and I'll whinge about it. And I do whinge about things like that. But if I couldn't sleep last night and ambient, or I'm paranoid about going outside, or I've been taking substances I shouldn't take, I won't talk about it. I'll say that I'm going to my doctor to get my shoulder fixed, but I won't say I'm going to talk to my therapist. And it's massively stigmatized. So that's the second thing. The third thing is really sadly, three years ago we lost one of our partners, Greg Mazonek, a total amazing human being, orthogonal thinker, tenacious, brilliant, quirky. And we lost him. And it was really, really hard in a small group of people to lose somebody to this. And I swore to myself and to his widow, Elaine, that I would talk about this where it never had the chance. So whenever I get in front of LPs, whenever I get in front of my portfolio companies, whenever I have the chance to talk about this, I want to just bring it out into the open. We've been working with an entity called Shatterproof, and Shatterproof is Gary Mandel, and he lost his son with alcoholic.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I do want to say this, Harry, that the fact that you're willing to bring it up so disarmingly and talk about it so openly I think is massively refreshing and really, really important. Where does it come from? Look, I have a younger brother who has struggled with drug and alcohol addiction for 30 years. I've seen him go up and I've seen him go down and I've been there at the Nadir and the depths of what alcoholism could do and how it can shred your relationships, how it can shred everything in your life and how it's just so destructive. I've watched him try and climb up the 12-step ladder. I've helped him go into various establishments and get stable. He's now been clean for 15 years. But he talks incredibly openly and disarmingly about his own journey and how hard it's been. So I have that part of my life. And just a point here. I think many of us have either had our own flirtations with various forms of difficulty in the workplace or know people that have. And we tend to bury it. We tend to not talk about it. And I say all the time that if I ever...”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“And the size of the opportunity was becoming enormous. The wind was roaring at our back. We were seeing digitalization start to emerge. We are now six, seven years ago, and the opportunity to embrace that was bigger than I could fund personally with Frank and Caribou. And then we found that there were lots of other refugees from Capital One and other places who wanted to come and join us on the journey. And they were at different points in life where giving them the opportunity to get the carry and be able to grow their own careers was really important. So I stood at the banks of the proverbial Rubicon for some time, recognizing and with clarity knowing that I would now have a boss and the boss was going to be my LPs and that this was no longer a hobby and a folly. This was now a business. And if you're going to do it, Nigel, you do it properly and you do it really well and you give it your best shot. And we did. And I've looked back on that decision a few times.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I call it the Rubicon crossing event, and it's exactly as you frame it because it would have been in some ways relatively comfortable to have that little family office with people I've known and loved for years and do some investing and not build another thing of any scale. But there were three criteria in my mind. One was, are we any good at it? Are we good investors? Now, my sense was I was a half decent strategy consultant and I had a really good run at Capital One, but this is a different gain investing. And are we any good at it? That was one, two. Do the portfolio companies that we work with want to work with us? And I always say to my team, look, I much prefer to get 4X and be loved and respected than 5x and be despised and feel like we took advantage. Two is, you know, do they want to work with us? Do the skills and the approaches that we have resonate and work? And then three, do we like it? Do we enjoy it? At that time in life, I had the luxury of focusing on doing what I want to do. So I started to tick those boxes.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Series of Capital One refugees led by my great friend Frank Rotman and then Caribou Hoenig, ex-Capital One people. And we started to say, you know what, what can we do here? Ideas were starting to come to us. And we thought, you know, out of a family office platform, maybe we'll make some investments and maybe we'll have some fun and maybe we won't lose too much money. And it was very modest. And what has happened is almost linearly, meticulously now, over 13 or 14 years, that has evolved into what is now QED.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm not sure if this is going to be what I want to do in the long run. And you know, people came to me and said, Nigel, look, this is what happens when you get to the last third of your business career. You know, have you thought about getting that really nice red sports car? Because it's all part of life. But look, I was changing and capital one was changing. And I thought there were new pastures that I wanted to take on. So I went back to London, lived there for a year, and I was detoxing from public company. So I took the opportunity to go from being very narrow and very driven during the capital of one year, wouldn't change it for the world, to being much more pluralistic, eclectic, broad. And I joined the Board of London Business School, Brookings, ideas 42, National Geographic, and the Economist, platforms, ideas, icons that I had relished for so many years. And I started to think, you know, maybe I'll just be a pluralist now and I'm dibble and dabble and be a dilettante out there. And I found it was really interesting, but it wasn't enough. And I came back to the US and we started to coagulate.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, look, if I ever write the book on QED, Harry, I'll make out that it was very thoughtful and I had laid out a strategic plan and then I flawlessly executed against it. But look, it's been a journey of me putting one foot in front of another and figuring it out day by day. But look, you know, the Capital One experience was absolutely amazing. I wouldn't change it for the world. I got to work with Rich Fairbank, who's one of the most special human beings on the planet. And we had an amazing run out of Cignet Bank, this wonderful old traditional regional bank in Richmond. We built this credit card juggernaut and I had 10 years running a public company with Rich that was just incredibly special. We grew amazingly. We went from a market cap of a billion to 10 billion. We grew our earnings at 25%. We became a great place to work. We developed the What's in Your Wallet brand. And it was really amazing. But I started to wake up in my late, middle, late 40s and started, say, gosh, this is slowing down. My intellectual curiosity is not being...”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a great pleasure. I've been listening to your podcasts over the years, and they've been really valuable to me as I've gone on my journey. So I'm delighted to have the conversation.”
2021-05-24 · The Twenty Minute VC · 20VC: Why Bundling Does Not Work, How The Best Founders Analyse Unit Economics, Why The Way We Approach Mental Health in Venture and Startups is Wrong with Nigel Morris, Co-Founder & Managing Partner @ QED Investors · IDENTIFIED FROM THE TRANSCRIPT · source