YouSaid · the spoken record

Ted Wang

lines on the record: 22
first: 2018-12-17
most recent: 2018-12-17
sittings or episodes: 1
sources: podcast

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“Yeah, I told you I've only been a VC for 20 minutes, so I don't think I have 20 minutes worth of material. So, you know, I've learned a lot. What I've really been focusing on is the actual investment decision. So if you think about venture, I think the job is really broken into four different parts. There's sourcing opportunities, picking the opportunities to invest in, winning the opportunities that you pick, and then helping the companies. And in my law practice, I did a lot of sourcing. You know, I built a very big law practice and people just didn't show up at my doorstep begging for my services, particularly in the early days, and helping companies with something that I had done for a long, long time. So it was really about picking the companies. That was what I was really weak. And, you know, I've built up a bunch of different methodologies that I now have both a system and a”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“It's a great question. And I'm going to remind you that when I first joined Cowboy, you reached out to me and said, hey, would you be on the show? And I said, no, I don't know anything. I have nothing useful to say at this point.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, absolutely. It all depends on what bad means. Many founders are not particularly good employees. So sometimes we'll get a reference call to say like, oh, she's really, really smart, but man, she is stubborn. And yeah, she really wants to get her own way. And okay, well, it's not the world. I mean, you have to kind of understand, and I think one of the core issues with reference calls is what are you trying to solve for? What are you referencing? And if the person said, well, she's really lazy. She doesn't show up for work, that would be problematic. But if it's like, you know, it's a little different than she's really hard-headed and sometimes she doesn't get along well with others. She's not that much of a team player. I go, okay, those are traits that sometimes I see good founders have.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, it's two different things. One of the questions I typically ask is, tell me what's changed in the business in the last 30 days. People who are truly learning a lot will give you some fairly concise answers and they say, oh, and usually there's some, I actually am very partial to this. Usually there's some tone of disgust, right? Which is like, oh, our website was like this. We had this landing page and it was not converting at all. It was terrible. But we fixed it, right? It's like when I hear that, you know, I'm like, okay, this person is trying to take on new things, understand new things as to how they're impacting the business and adapt to them. And then the other thing is reference calls. You know, we're able to talk to people, and that's something we always want to ask about is like, how did the founder develop, you know, how did this person develop during their time at company X, whatever that they did before?”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, look, I think if there's one factor that is most highly correlated with success of a startup company, it's the founder's ability to learn. And I just think it's the most critical thing because ultimately as they take on the company, as the company moves to different stages, the ground shifts under their feet. The challenges that they're trying to take on change, they have to learn how to do different things, whether it's hiring or scaling or the market changes. They have to adapt. So you really want to look into is the founder a learning animal as I think about it. I don't think I'm sophisticated enough to try to track the rate of that change over time. That seems a little high fallutin for me. But, you know, I really do want to make sure that the founders are learners and that they care about learning and they're intellectually curious. And I think that's highly correlated with success.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“About it. I'm also like, I've been really influenced by Ray Dalio's book, Principles. Ray Dalio was the founder of Bridgewater. And he talked about a credibility weighted idea meritocracy. So that's a pretty complicated topic. But basically what he's saying is, as you're considering advice, you should consider how much does this person know about this topic, right? So if I'm talking to a doctor about a disease and the doctor is a specialist, like I'm really going to, you know, I'm going to weigh that advice a lot more than my own thoughts after reading a little WebMD. And I think the same thing applies to giving advice to founders, right? So if I'm talking about the marketing and go to market, I know a little bit about that and some things more than others. And I may have some suggestions, but I'm really going to be very deferential to the real experts. Now, if we're talking about something like Mesher Financing, and I've probably done 10,000 of those, I may lean in a little bit more heavily on my advice and say, gee, you know, I hear what you're saying, but you really might want to listen to me about this because this is something I know.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Not be the right thing for the person to whom they are giving advice. And I think that's something that folks, founders need to be aware of. And the way it informs how I try to help our companies is the first is a realization that I don't have as much information as the founder, right? The founder is looking at this problem all day long. And so all I can do is sort of suggest some things to him or her and say, look, here's a different point of view. Here's some ways that other companies do it. Ultimately, it's your decision. There's a great expression that I've heard, which is like, if you don't do what your board of directors tells you as a CEO, you may or may not get fired. But if you do do what the board of directors say, you will get fired. And so it's a great lesson. That's a little bit more of a big company thing. But, you know, it's a great lesson. Ultimately, for founders, if you do exactly what you're told to do by your investors and the company fails, you're a failure. If you don't do what they say and it's successful, you're a success. So ultimately the decision is in the hands of the founders. And I think the best advisors are aware of this and just try to help you think.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. I have to give credit. This is Drew Hauston, the CEO of Dropbox, told me this story once, and I found it brilliant. And so I want to give him credit for putting it in my ear, which is, you know, if you're sitting around the table and you're talking to, imagine like you're getting advice and you're talking to a bunch of animals, right? And they say, like, what's the key to survival, right? You know, first, there's a lion. And the lion says, look, you've got to be big. You got to be strong. Only the strongest survive, right? And then you have an elephant sitting there. The elephant says, well, you got to be big, right? Only the biggest you never go to survive. And then you have a mouse, right? And the mouse is like, oh no, you have to be small. When you're small, there's not as much competition for the food and you can go get it all over there, you know. And the point of this story is that everyone's advice is really shaped by their own experience. And that is one I do find one pernicious thing in the ecosystem is we find a lot of people who give advice based on what happened to them and what worked for them. And they don't have the breadth of experience to know that that may or may not be.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. Well, look, I mean, I think first thing is understanding the limits of what you know. And so I think there are really kind of two cores value adds that venture capitalists can have for as they give advice. One is sort of, hey, here's a different point of view about that. Someone's looking at a problem and you say, have you thought about it from this perspective? And that perspective is going to open up the entrepreneur's eyes, maybe, to a different route or a different way of thinking. And the second route is really benchmarking, right?”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“The interesting thing when I was a lawyer, people used to come to me and say, oh, so and so told me I should do acts or I heard that Facebook did Y and they had all these theories about what they should do. And I found that advice often wrong. I mean, there's tons of content available where people can read about all these different approaches to a certain problem, but you have to understand and be able to apply the rationale behind any particular piece of advice. So what worked for one company, you know, we just talked about jet.com a moment ago, like what worked for JET.com is not going to work for most founders. And so you have to think about the advice that you get. Why is the person giving you the advice that they're giving you? Why did it work for them? And does it apply in your case? And I think that's something that gets oversimplified all the time. I mean, I totally agree with you.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, look, one of the things I think about venture is that everyone has a different approach and many of them work. I like to use the analogy. If you look at baseball, right, you look at baseball, a batter. You have a guy who's standing 60 feet away from a guy throwing the ball trying to hit it. And yet they still have like 27 different approaches. If you watch a baseball game, you'll see people with all these different types of approaching to hitting. You know, if something as simple as hitting a baseball has all these different potential approaches, I mean, I think venture can have a lot of different approaches that can be successful. I mean, for us, we generally try to take our position in the first check. And then, you know, then we're going to try to maintain that position throughout the various rounds of financing. But I know other people who think about it differently, and we try not to be rigid about it, right? You know, we try to say, well, if we like something and there's an opportunity to increase our stake, let's not draw hard lines about that. I agree with you.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Big, big bets. You have to get a portfolio that has a certain number of opportunities in it, a certain number of investments in order for it to mitigate the risk of one failing. But on the other hand, if your ownership isn't high enough and your winners don't pay back the fund in a sufficient manner, then you've run a different risk. So you got to strike the balance right in between. No, I totally agree with you.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“And I sort of thought it was, it sounded pretty stupid to me, to be honest with you. And now I found that I was in fact dead wrong. And percentage ownership is just so critical because at the end of the day, of course, particularly at seed stage, every investment is very risky. But, you know, with risk, you have to have reward. And so if you own 1% of a bunch of companies, that's just not going to be able to move the needle and return a fund of any size. Or angel investors who have different motivations as well and are largely investing out of much smaller pots of money. If you have one investment that returns 25 acts, even if it's a very small check, that's a significant return. And that can really set you up well. But for us, Cowboy and I think for other similarly sized seed funds, we have to make a handful of concentrated bets so that when our winners pay off, that they're able to make material returns to the fund. So it's actually a great illustration of the risk point that I was making earlier because on the one hand, you don't want to make these big”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“As opposed to trying to hide these risks off in the corner and think you can get around them. Now, to be fair, every founder is not Mark Lorry, right? Market had had a successful outcome before, was able to attract capital, was able to attract people. So, you know, I don't think that, you know, a first-time founder is going to be able to pull something like that off. But it's an interesting marker as to being really thoughtful about what risks you're taking and being intentional about them and how it can pay off for you if you are thoughtful. Speaking of risk and maybe how it can pay off for you, with risk being so unavoidable, one would logically lean to a massively diversified, almost spray and prey portfolio approach. How does your thinking around risk maybe correlate or not correlate to your thoughts around portfolio construction, Ted? Yeah, I think this is an area where I've really learned the most since I've started on the venture side. You know, I think when I was a lawyer watching other venture capitalists, I master portfolios, I really didn't understand why they were so focused on percentage ownership.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“So jet.com was a company that I had a chance to work with when I was a lawyer over at Shenamacan West. And the founder is a guy named Mark Loray, a brilliant guy. And what I thought he did that was so intriguing is he built that company so that it was going to be big or just die. And, you know, and you could say my view is that he had one of the most thoughtful approaches to risk of any person I'd ever met because he knew he was trying to take on Amazon, right? In a certain way. And you can't sort of limp into that. There's no lean startup methodology that's going to get you into competing with something like Amazon. And so Mark really went for it, right? And he started spending a ton of money right away and he consistently had to fundraise and had to grow at all different times. And there were all these different risks that he intentionally ran. And it had a tremendous exit, sold for over $3 billion to Walmart. And I think it's a great example of being thoughtful about what risks you're taking and being intentional about.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think when you back CD's founders, you have to accept the fact that it's very often not going to work out. And when people give it their best and it doesn't work out, it doesn't mean we wouldn't want us to back those founders again. There are lots of different things that can happen along a journey that can change an outcome, all sorts of external things. And as long as the founders are giving it a good go and being thoughtful about the different risks they're taking, when those risks emerge or something unexpected emerges, that's part of the seed stage journey. That's part of the lifecycle.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Ethical risk is not one that I'm willing to take. So I think when we look at founders, there are certain risks we try to avoid.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Sales and sales is expensive. And so there's this ramp up that is pretty daunting and it puts a lot of risk on the company. But to say that hiring folks is risky misses the other side of that equation, which is if you grow too slowly, you know, the opportunity is going to pass you by. Your competitors are going to take market share. You won't get enough market adoption. You're not going to have enough growth to attract the world-class investors and capital that you're going to need to grow the business. So it's sort of nonsensical to say that there's a risk-free course. It's just a matter of which risk you're going to take. For me, I sort of liken it to skiing a lot, which is simple when you're learning to ski, you sort of ski a little bit back and forth. But at some point in your journey of becoming a skier, you have to learn how to point your skis downhill and sort of go for it. And just inherent, if you want to learn the sport.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Funny because I think you're absolutely right. We get a lot of people who come in to pitch us and they try to talk about the risks and how they're mitigating them or that these aren't very risky opportunities. And I think that's sort of nonsensical, right? By definition, if you're taking on a big challenge, if you're trying to build a really great company, it's going to be extremely risky. I like to say it's sort of the basic notion of a startup is like, hey, you, me, and this woman over here are going to jump in a rowboat and we're going to row it to Japan, right? And so it's not like there's not a low risk way of attempting something so audacious. So I think the biggest miscalculation people make about risk is that they think that there are ways to mitigate certain risks when actually it's just a matter of which risk you're going to choose to take. So the one I like to always point out is a good example of this is when you're thinking about growing an enterprise software company, right? So you're growing a software company, obviously you sort of have to hire people in order to grow the company, particularly.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“What the values are going to be, how people are going to work, how people are going to treat each other, how people are going to think about partners and all sorts of different key things that really will live on into the company for a long, long time.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“And I wanted to continue to grow and continue to challenge myself and to try to do something where I could really learn, you know, continue a very steep learning curve. And so that's why I dove into Venture. I looked around at a lot of different alternatives of things I could do and then a lot of different venture funds and different stages. Really, I would concentrated on the growth stage venture and the seed stage as I began the search. And the thing that really drew me to the seed stage at the end of the day was just, I love working with founders. And the fun part about the seed aspect or the seed stage of a company's lifecycle is it's really just a few people, like a band of pirates is a great way I think about it. And these are folks who sort of are envisioning a future that is unlikely, right? They have a big vision about what could happen, but they're bound to determine to get the thing done. And I think that's just such an interesting mentality that brings you to that place. It's an interesting time to be with a company and a time where you really kind of lay the foundations out what the company's going to be about.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I get asked this question often by people who want to get into venture. They say, well, you know, I'm looking to get into venture. Tell me about your journey. And I say, well, I worked for 20 years in a different industry and then I got into it. So I don't know that it's the normal path, but I was a lawyer at Fenwick and West for actually the last 10 years I was at Fenwick and I spent 20 years working in the technology industry helping startup companies with everything from forming their company to IPOs and to selling the companies. And I had a chance during that journey to work with just so many different companies to see so many things as to what made companies successful, the different struggles that founders had to go through, a whole host of different aspects of the startup lifecycle, I guess, is the best word I could use. And, you know, after doing that for 20 years, I love the job. I used to tell people I was the happiest lawyer that I knew, but I sort of thought that I had reached about the summit of it. I didn't think there was a lot more for me to learn. And I still consider myself young. I may not be physically young, but I'm young at heart.”
2018-12-17 · The Twenty Minute VC · 20VC: A Framework For Approaching Risk and How It Affects Portfolio Construction | Lessons and Advice From Working with Dropbox's Drew Houston | Why Being A Learning Animal Is The Most Important Factor For Success with Ted Wang, Partner @ Cowboy Ventures · IDENTIFIED FROM THE TRANSCRIPT · source