USE QSBS

“When I picked the name Pipedream, there were a few people that said, you can't name your name Pipedream because you're saying it's like a fantastical thought, therefore it's impossible for it to come into existence. But the true story is we had a meeting at Chime where we were sharing what we were working on and the CTO of the company basically said, I mean, it sounds interesting, but I think it's a Pipedream. That was kind of his response to our business. I didn't honestly, I don't think I really understood that time by the way that it's actually a drug reference.”

“QSBS is basically a tax paradigm in the United States where if you invest in a startup that meets a certain amount of criteria, I believe the criteria used to be 50 million in value. It had to be less than 50 million in value. It has recently changed to less than 75 million in value. And you had to hold that investment for originally five years. And now there's like a proration period during that five years. But if you met that criteria, then you paid no federal taxes at all.”

“I generally don't like the advice of follow your passion. I've never really liked that advice because I found that many people I know have amazing passions that are terrible businesses and they're able to apply the exact same like enthusiasm and energy to things that are much better uses of their time. So I feel like maybe, you know, enjoy your passions, but not necessarily follow them professionally.”

“First of all, the best investments I've made at seed, the majority of them have actually ended up being pivots, meaning that the company I invested at the time, if I had hired BCG and done a month of diligence on the company, the results of that research would have been irrelevant because what actually worked out from the company was a completely different business model later. It's not all of them, of course, but it is the majority, which sort of surprised me. And so I think that that just calls into question, like, what is the decision-making process to make a seed investment?”

“Somebody called me and said, specifically, I'm selling the company, and it was a company that was doing performing quite well. And they told me they were selling for half their valuation. And I was shocked because this is actually one of our best investments that we've made over the past like three or four years. Companies doing well, growing fast... And then I was like, oh, so it sounds like you're giving up, right? Like you would only sell your company for half of the valuation if you were giving up. And the founder said, yeah, I'm going to go start an AI company.”

“I've been using the analogy lately of tech competition feels much more like professional sports now than it ever did. Maybe over the 2010s, it was more like D1 sports, and maybe before that, it was more like high school sports. It is optimized to a degree that it was almost unfathomable a decade ago, and that's at every level. That's at the engineering level, that's at the product level, that's at the company building level, that's at the venture level. There's really no pocket where you can say, wow, this is really amateur hour.”

“I feel like I have a public service announcement to deliver. And that public service announcement is that Silicon Valley is the center of the tech universe. There was a period of time where people thought that that either was not true or was no longer going to be true. And that is incorrect. Austin is great. Miami is great. They are not even casting a shadow on Silicon Valley in terms of tech innovation and where companies are being started.”

“I mean, I think fundamentally seed investing has always had the highest annualized returns of any asset class with Inventure. And so it's where everyone would like to put the majority of their capital if they could. And obviously the reason is because you're investing earliest at the lowest price and you get the largest ownership for the smallest check. And so if you can get in the marquee companies, then it's the single best place to be.”

“I'm a little concerned for what I call like the first generation AI companies. And that's basically like companies that were built on top of the models, and they were building feature sets where the models didn't have capabilities. And the argument was, oh, as the model gets better, my product will just get better. And that was the sort of shared thesis of many of these companies. And I actually thought it made a lot of sense... I think what people didn't fully appreciate, and I definitely didn't appreciate, was that the acceleration and the capability of these models would actually start like, if you think of it as concentric circles from the core, they would just start eating these adjacent concentric circles faster and faster.”

“I've basically come to the consensus that investors, and this is probably my maybe most controversial statement, but investors will never approach a founder about paying them more money. In my entire career, I can think of it less than five times that it happened. It is just not top of mind on the investors' tasks to do. And I actually don't think it's like bad intentions or malice. I think it's just not in the regular course of business things that come across investors' desks.”

“The only thing I know for certain is that software companies are completely mispriced. What I don't know is are they completely mispriced and massively overvalued? Or are they completely mispriced and massively undervalued? Because the current value of the software company is basically a probability that in 10 years things go really bad for them. And so if they do go bad, then the companies are overvalued. And if they don't go bad, then the companies are undervalued.”