AVOID BALANCED ALLOCATIONS

“The venture business as a whole doesn't work. It doesn't work, it shouldn't work. Returns, distribution are not divided equally between players. Otherwise, it would be too easy and there won't be winners and losers. It would be boring. None of us would be playing that. We would do something else. So the expectation that the venture business would work out is set yourself for disappointment from the get-go.”

“When I wrote the first check to Asafo Rapoport at Adalome, at the first company they started in 2012, it was done at $15 million post, $5 million check. At Wiz in 2019, I wrote a $6 million seed check at $66 million post money. Today, you can see, watching deals done at $100, $150 million post, many of those deals done at high prices, that's in the incoming stream.”

“The fact is that out of around 150 new companies in cybersecurity in Israel, the likelihood you'll hit a successful company is still one to one percent. It's one out of 150, maybe two out of 150. And the prices, the entry prices where you buy stock at the seed stage is going significantly higher means that the market is not balanced. A lot of that cash that's flowing into the market would be wasted.”

“Venture is a game. You know, we know very little. When we get into investments, we need to be selfish, and we need to be greedy. Those are good trades for an early stage investor. As an investor, you look at yourself and say, okay, I really fucked up. I'm not in a business of babysitting founders.”

“If I'm a limited partner and I have distributed my venture allocation evenly, I wouldn't sleep well at night. If you look at all the amount of money that's flowing into the markets right now and for the past few years, no, I don't think it's going to work. I think it's going to end up with some serious catastrophe for many of the players.”