YouSaid · the spoken record

Paul Hsiao

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25
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2018-04-09
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2018-04-09
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  1. “Yeah, the two companies, roof stock and Thrive Global, Roofstock is this marketplace for single family rental home, Thrive Global is targeting a lot of the device addiction and sleep problems that we have both represent really important new opportunities that haven't been solved. And we're excited about the potential of both and that making an impact in all the consumers work.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “I think so, yes, but I can change quickly. I think about Alexa or Google Home, those could all emerge or become an important new distribution channel. We don't know yet too early to tell. But yes, we are in a period where we lack new and free viral distribution channel.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “I would say going back to the study and also seeing my own data points, the capital efficiency. Well, actually simply, it is important to win the capital arms race that raising $100 million is critical to the success of new companies.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “He has a unique way of understanding the really critical problem around the corner for a fledgling company and helping the CEOs entrepreneurials navigate through those difficult times.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “The book I will recommend most is perhaps the innovator's dilemma, being the seminal book by Clay, and it's just really well written and forms the foundation of a lot of these really interesting business builds.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “Yeah, one is that when you look at them and think back, I think both perhaps Paul Grant and Clay Christensen have said it well. Many of these large business look like small idea or even a terrible idea when they first got started. So it goes back to earlier of our conversation. You just don't know. They got dismissed by incumbents oftentimes by the capital source. I think the same that being contrarian, being lucky or right is what allows you to build something very valuable.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Yeah, I think for the LPs, for the Linux partners who have trusted their capital with us, there's more than $600 billion currently trapped inside these large private enterprises. And I think it is our fiduciary responsibility and of the industry to return some of these really important capital wealth creation back to them, back to the foundations. And so I think it is an intrinsic structural problem for the industry.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “Yeah, you know, I think the company used to tap the public market at a much earlier phase of their development. So they didn't raise a lot before they became a public company. But now I realize the capital efficiency might be quote-unquote overrated as an entrepreneur. One should plan to raise at least $85 million if you want to have a decent shot at building a large company. You know, 90% of the entire cohort raised more than $85 to $100 million. I mean, there are always exceptions like stitch fix, zooplot in UK and Tableau in Seattle, but really the vast majority of them have raised a lot of capital, especially in more recent times.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “Yeah, Terry, you know, it's very humbling. One commonalities, the most striking one is they are mostly started by young people. We all know some of the extreme examples of Gates, Zuckerberg, and Steve Jobs, who started their companies in their teens or early 20s. But I was surprised by how 80% of these 500 names, the founders of these companies all started the company when they were in their 20s and 30s. In fact, if you look at the age group a little bit differently, 60% started their companies younger than age 35 and 40% of these very big winners, the funders were younger than 30 when they started these companies, striking commonality amongst these big winners. When I looked at the financial institutions, I was surprised that Henry Krab is of KKR started KKR when he was 31. You know, and same for Michael Bloomberg. And so there's something really interesting there.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “So, what we do is we run these servers to a few different services, as Wonder and others. And we were looking for are not necessarily quantitative data, but qualitative data on how the users respond, particularly emotional response to these things. And from there, we understand the different usage scenarios. So we're truly trying to understand what are the usage scenarios that people are attracted to the new service. And that's how that is a main usage of the user survey that we do.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Yeah, it's more an intuitive process for me. I try the product, I use it, I try to immerse in it, and I try to understand what is magical about it. Oftentimes at the stage where we invest, there's just no data to prove. And so that becomes”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “I don't have a good answer yet. My suggestion is just we move the bias. I think some of the common criticism that you hear are true, right? When a female entrepreneur presents the confidence view as negative as being too aggressive. So if we collectively can just remove the bias and focus on who are really going to build great companies, I think that goes a long way there. I think sort of consciously removing the bias is an important first step here.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “You know, it was an accident, Harry. I did not purposefully seek out female entrepreneurs. We didn't really have a bias either way. I just wanted to point it with the most exceptional entrepreneurs. And I've been very fortunate that they are female entrepreneurs in my portfolio from Audi at Health, Shannon Zola, Coronet Flux, and now Arianna at Thrive Global. I mean, these are the best entrepreneurs and they happen to really happen to be female. One thing that's unique about this cohort of entrepreneurs is that they tend to underpromise and over-deliver and it's really just more consistent amongst the female entrepreneurs and CDOs.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “Those you do look at the monthly cohort, the frequency of them come back using them on the monthly basis, even for Lending Club and others, you'd be surprised how many people come back and check for their opportunities to refine or for house looking for inspiration. That responsibility goes back to the product team, even though the transaction maybe happens once every couple years or even happen once a year. There are different behaviors that you can add to the platform that will keep your user engaged and stay with you through the journey of the decision.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Yeah, at that level, when deciding whether you put a lot of capital to work, we look at the monthly repeat cohort data. It really tells you a lot how often they come back and all the things we just talked about play into and contribute to that cohort data. And that's the truth. And I think some of the massive marketplace network teams will tell you that's a religion for them when they look at those data on a weekly or sometimes daily basis.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “I think the curation matters a lot once you have supply congestion happens, right? Meaning it takes too much time to find what your users want. Professor Elvin Roth over at Stanford who won the Nobel Prize for Marketplace Design is really eloquent about this topic. You want to develop a layer of people or technology that helps your users to find or recommend to them what they want quickly. And the last one is just trust. Trust in payment, in quality, in safety. We see many underestimate this early on and eventually scrambles to address trust. And so those are the top five lessons that we think are some of the important ingredients of building a good marketplace.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “Yeah, it's a great question, Harry. I think the stubbornness in marketplace helps a lot. We see so many people give up. I think Brent Hesky at Airbnb talked a lot about how they relaunch Airbnb many, many times because people just didn't notice them. And so we value that. And that is something we do recommend. I think when you know you should give up is when your supply is not differentiated. When the users can actually find you supply at a lot of different places, you have to question whether what you do is truly making your supply size business better. Is it transformational? Are you making the idle asset more productive? Those are important qualitative measures to look at.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “The others, third, is actually takes patience. It takes the growth curve, looks more like step function versus a linear curve. You get frustrated that demand looks flat for a period of time. And we see this often. And then suddenly the demand jumps. You get all excited and then it flattens out. And it's just a roller coaster, right? And I think there's a correlation. The quantity of good supply drives demand. So when supply reaches certain critical mass level, the demand jumps and then it settles at some steady. So it's just a really interesting phenomenon that takes patients and takes supply”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “You know, you see it when the users start using your product. I mean, that's probably a simple answer. You try different things and you know you hit the right one when it's just so natural in your distribution partner's usage flow in terms of adding you to it. YouTube did it with a little widget and just people wanted to click on those and they understood which ones were giving them the most users. And I would just say take a data center approach to that.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “Yeah, thanks, Harry, for the question here. You know, I define marketplace broadly as whenever the company can attract and aggregate buy and sell site together. They are very valuable and long endearing enterprises. I mean, just look at Amazon, Facebook, Tenzin, and Alibaba, but they are very difficult to build because it's hard to solve the chicken and egg problem. Entrepreneurs often ask, do I focus?”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “My suggestion, taking up my hat as VC to entrepreneurs, is always about picking the right GP. My friend Kevin Ryan, who started many very successful companies and raised capital from many different venture firms, found blue chip names to new office like us. Vice as his CEOs that ultimately an entrepreneur's relationship with VCs is with one individual of the firm. You really see other partners. So picking the right GP for you is the most important and not the firm. And I've seen that to be very true.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “It does, right? I think one realization coming since joining Canvas a few years ago is a small exit like 150, 300 million, easily moves the needle for a font like Canvas, whereas we used to joke when you don't have an exit more than 800 million, it doesn't move the needle at NEA and get back to work. It's just people barely notice it. And in some ways, has provided so much operating freedom in terms of chasing ideas. A lot of the big ideas look like small ideas big companies that look like small ideas early on. You still want to chase those, but when you quote unquote wrong and they have 150, 300 million exit, it's still really meaningful. That's a very different degree of operating freedom.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “Yeah, totally. So both are great platforms. NEA covers almost all the innovation sectors and many geographies around the world as well. So they really have a broad perspective on all the cool innovations coming down the pipeline. And I love Canvas now because we're just very focused on a few select areas and allows us, I mean, go deep, move fast, and frankly have a lot more time with our entrepreneurs. And so that's sort of the difference between the two in terms of how both platforms operate.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “And this way, I can watch the best in the business, how they do it, and emulate them. So thanks to Kaufman Foundation, they were worrying they won enough interest in venture capital at that time and structure the mentorship program so they create a fellowship program called Kaufman Fellows Program. I was matched with Scots and Dale at NEA as my mentor, and that's how I got into venture. Kind of crazy.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “So I was a biomedical engineer by education and started my career at a medical device company called Metronic, but I always wanted to build my own company and had the fortune to co-found the network security company called Mazu Networks with really a software-defined routing technology that was the thesis work of the Kohler while he was a graduate student at MIT. And it was just so much fun, you know, as to be very smart, humble co-founders. They were also my best friends. We maxed out our credit cards initially, put my McKinsey scholarship to work. We knew that wasn't going to scale. So luckily, we raised venture capital from both Graylock and Benchmark capital. And we got going, did a few things right, learned many lessons from my mistakes. When Mazzo was later acquired by Riverbed Networks, I was hooked, but I really wanted to learn how others truly built these large businesses. So I thought the best way to learn was to be on the capital side for a few years.”

    2018-04-09 · The Twenty Minute VC · 20VC: Why You Have To Raise $100m+ If You Want To Go Big Today, The 5 Fundamentals To Starting and Scaling A Successful Marketplace & Why Female Founders Under-Promise and Over-Deliver with Paul Hsiao, Founding Partner @ Canvas Ventures · IDENTIFIED FROM THE TRANSCRIPT · source