E377: Midas List VC: Why Most VCs Miss the Biggest Companies

What if the biggest venture returns are already gone by the time a category has a name? In this episode, I sit down with Niko Bonatsos, Founder and Managing Partner of Verdict, to discuss why the best venture opportunities emerge before consensus exists. Niko explains why “50% of the profits are made before a vertical even has a name,” how he identifies “freak” founders with extreme rates of learning, and why most VCs are structurally incentivized to follow momentum instead of creating conviction. We also explore why consumer and gaming are deeply undervalued today, how AI is changing company formation, and why relationship-building compounds harder than capital in venture investing.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00David Weisburd?

  So Niko, you were at General Catalyst for 15 years before you spun out to start your own firm. Last time we chatted, you said something really interesting, which is 50% of the profits are made in a vertical before it even has a name. Talk to me about that.

• 0:12Speaker 01

  Oh, yeah. So I'll do it by virtue of giving you an example. So when vibe coding as a term was coined, Cursor was already sitting at the $10 billion valuation.

• 0:25Speaker 01

  Not only that, Anthropic had just started copying them through Cloud Code. Not only that, Lavable and RapLaden adjacent markets were already minted as unicorns. The vast majority of the profits, over half of the profits that will ever be realized in any of these companies, have already been spoken by the founders, founding team members, as well as the very early investors in any of the companies mentioned. So for anyone who is thinking of themselves as a very early investor, if they want to invest in vibe coding today, or they did so last year, they're betting on, one, the founders themselves out executing any of the incumbents that I mentioned,

• 1:11Speaker 01

  as well as the category of vibe coding to continue to be relevant five to seven years from today. I'd rather buy a bunch of lottery tickets instead.

• 1:18David Weisburd?

  50% is 50%, it's not 90%. But what's crazy about that is oftentimes this is one or two years, and then the industry proliferates for another 20 years. And within that one to two years, they're getting 50% of the profits of two decades.

• 1:30Speaker 01

  You're so spot on. So I've been a very early investor for over 15 years now. I actually have studied when does the vast majority of seed money get into a space? And it actually happens the two to three years after a company has already been minted as a decacorn and/or there's a big exit in that space. You can go category after category. VR with Oculus exiting, space with SpaceX getting minted as a decacorn, autonomous vehicles with Waymo being a decacorn, and Cruise getting sold to GM. You go category after category. Well, guess what? That seed funding doesn't work as well.

• 2:10David Weisburd?

  Is this why you call VCs sheep?

• 2:13Speaker 01

  Most VCs, it's hard to be an original thinker and somebody who wants to make a decision.

• 2:20Speaker 01

  On the back of your own conviction is the original one. It's just really hard. There's a place for everyone. There's plenty of money to be made in the late stage. There is plenty of money to be made at the very early stage. We need everyone.

• 2:34David Weisburd?

  Ian Sigalow, who's sitting right where you're sitting from Greycroft. He said because of that, early-stage venture is not really an asset class. It's a artisan craft. It's almost impossible to scale.

• 2:46Speaker 01

  I agree with that. Yeah, so if you want to have 100 Xers from your original, like, check, it's really hard to scale in general. The average VC fund doesn't perform. So it's about the very few that really go the distance. Most of them really suck. Especially now, how VC looks like today.

• 3:06David Weisburd?

  Tell me about that.

• 3:06Speaker 01

  You either want to be the original investor, like we at Verdict are making this claim, that want to be the best first money venture capital firm. Or you want to be in the very late-stage game, taking companies from $10 billion valuation to $1 trillion plus in the private markets and plowing in billions of dollars. Anyone else in between, I think they're gonna, they'll do very well. Why is that? Because the best founders today are thinking about capitalizing the companies very differently than even a year ago. Why is that? Two founders today with one round of funding, all the AI tools. In two months, oh my God, they can make so much more progress than what a year ago.

• 3:48Speaker 01

  You needed 10 people, two rounds of funding and a year worth of time. It's changing how companies capitalize themselves.

• 3:56David Weisburd?

  Not only that, I think one of the most underappreciated aspects of AI is not just that it's bringing down costs, it's also increasing revenue.

• 4:03Speaker 01

  Spot on.

• 4:04David Weisburd?

  You're making every single person 10, 15 times more efficient in getting that incremental customer. So if you think about startup, typically you have to spend tens of millions of dollars to get to profitability. Today, you don't necessarily have to do that. You could spend, you could wait until you're a series, the equivalent of a series B, series C, series D company and take those large checks.

• 4:24Speaker 01

  You are spot on. We're seeing it on the field right now. So your dollar as a first money investor goes so much further. So those founders are gonna skip the in-between rounds and they're gonna go from what you would call in the old world, pre-C to series B, basically.

• 4:39David Weisburd?

  I've known you now for eight, nine years and you've always been this contrarian thinker, going in early while you're at General Catalyst. How do you know exactly when to go before there's consensus? Because if you're truly, really early, even if you're right, even if it should exist, it doesn't really help if there's not follow on cap.

• 4:56Speaker 01

  That is true. And actually, 70% of the times, I get it wrong. So everything I say today, assume it's 70% wrong. Look, my partner, Michael Furtick, and myself, we are maniacs who work founder hours. And we're in the business of investing in freaks, also known as learning animals, that are working on creating new categories. So we're specialists when it comes to what we're, exactly what we're looking for. Freaks who are building companies in markets that have no name yet. That's all we do. And 70% of the time, our timing will be off. Because the freaks that we're investing in will go after a market that might actually pan out five, 10 years later.

• 5:39Speaker 01

  But 10% of the times, we're going to be very right. That's how we think about it.

• 5:44David Weisburd?

  You've used this term freaks multiple times.

• 5:46Speaker 01

  Multiple times.

• 5:46David Weisburd?

  How do you define that? What does a freak look like?

• 5:49Speaker 01

  So a freak is, in the startup context, it's very much like professional sports. Few people, break all the records, make all the money. So a freak in the startup context, somebody who is a learning animal. And in one day, they can learn, they can mature, they can make so much progress that takes the average fear smart founder a whole week. They treat every meeting, every decision as a learning opportunity.

• 6:16David Weisburd?

  Their sponge.

• 6:17Speaker 01

  Oh, yeah. So if you meet such a person today, and then you meet them again in two days, and everything they tell you sounds the same, that is not a freak. Because at a minimum, they're not listening.

• 6:27David Weisburd?

  It's the rate of growth.

• 6:29Speaker 01

  That's it. Rate of growth. So for me, even if the initial idea is wrong, but these guys are freaks. Dude, like in a few weeks, at the latest, they will move on to the right idea.

• 6:42David Weisburd?

  Looking back at your 15 years at General Catalyst, the 70% times that you were wrong, was it just probabilities in that you didn't necessarily make a mistake? You just got unlucky with the timing? Or were there specific lessons on timing?

• 6:54Speaker 01

  It's not just one thing, but I would say quite a few times, we were just so early. Other times, we picked the founders who didn't end up, you know, becoming the winners in the space. They were good in the zero to one game. They were good as entrepreneurial CEOs, but they didn't become the enduring CEO in the space. Some other times, in the context of a larger venture capital firm, you also do investments in other CEOs. So you get conflicted out of some of the more amazing ones that go the distance. And also, you know, I'm now 15 years in, but when I got started, I was not 15 years in. So I made a number of judgment errors along the way.

• 7:39David Weisburd?

  What's a common mistake that smart VCs make early in their career?

• 7:45Speaker 01

  They don't take enough risk. They try to play it safe and do the doable deal that gets them promoted, do the doable deal that will get a quick markup from some other notable people because it's in a hot, you know, space right now. But might not be the one that they're really swinging for the fences.

• 8:04David Weisburd?

  Have you seen average teams get pulled up by momentum in hot sectors? And if so, what does that look like?

• 8:11Speaker 01

  I've seen it again and again. And sometimes I paid the price for that. So it happens in particular when the times are good. Actually, today, no joke. I met a 19-year-old who is a founder that I've known since he was 16. He raised venture funding. Now he is an angel investor and venture partner at another firm. In the last four months, he's made six angel investments. All six of them already have received a markup. I asked him, do you think that's normal? He said, no. I was like, I'm glad you said that. So if you remember, I'll just use an example from the past. Once upon a time, self-bank showed up and they started over-capitalizing companies. So a lot of the earlier-stage VCs started organizing themselves around what if self-bank

• 8:54Speaker 01

  wants to invest, let's make some early investments and serve it to them. And sometimes, over-capitalizing a company before they're really ready could really destroy them. But if you're the early investor in that company, you can benefit temporarily career-wise.

• 9:10David Weisburd?

  You mentioned this 19-year-old, now venture partner and angel investor who was 16 when you met him as an entrepreneur. It seems like today, VCs are fetishizing A.H. Why is that?

• 9:22Speaker 01

  This happened in big time right now. I think the primary reason is because some of the most successful later-stage companies in the private tech markets today were founded by very young founders, were 18, 19, 20, 21 years old, three, four, five years ago. So when Michael Furtick and I were investing exclusively in Gen Z founders in 2021, 22, 23, there were probably 10 other VCs in the US who were investing in them. But now, some of those founders are the founders of Cursor, Merckor, many others. YC also, in the meantime, back in 2021, average age was like 30-plus years old. Now, after Gary Tan came back, he brought it back down to very, very young founders.

• 10:07Speaker 01

  And VCs want to invest in what other VCs are investing, because you feel more secure. You feel that that founder is going to raise more easily the next round. That's what's happening today. So you're 22 years old today, you're in San Francisco, you're building your tech startup. Oh, my God. You check your mailbox, there's a seed term sheet. You're 18, 19 years old, you check your mailbox, there might be a Series A term sheet. Second saying.

• 10:34David Weisburd?

  Let's play devil's advocate. I think the thesis there is that these are AI-native founders, they don't have the scar tissue of having to manage some of the legacy software, the legacy processes. They're obviously young enough to work the 996. Are none of these good reasons to invest into young founders?

• 10:49Speaker 01

  It's an exception, basically, is this.

• 10:53Speaker 01

  Sure, if you come across a freak and you're sure that they're a freak, you should invest, no matter what they do. Even if the price is super high, invest. But a lot of the young founders are not doing the stuff that you talked about. They might be trying to build a nuclear submarine. That's less likely that they're going to be successful than somebody who is more experienced than them.

• 11:18David Weisburd?

  In general, you take this contrarian view on the market and you invest into the underappreciated sectors of the startup ecosystem and you sell or avoid the overbot and the overhyped parts of the startup ecosystem. What today is most overhyped?

• 11:33Speaker 01

  Anything that has to do with American dynamism, overhyped. Today, anything that has to do with AI broadly, overhyped. So like you're two, three founders leaving Cursor, Mercoor, OpenAI, Anthropic, boom. You can raise 15 to 25 billion dollars if you do something in AI without having anything to show for. You're somebody who's leaving SpaceX. You want to do something in American dynamism? Great, you're going to raise a very large seed round, could be a 3A series A.

• 12:06David Weisburd?

  What about on the other side? What's undervalued? What are you bullish on?

• 12:09Speaker 01

  Consumer, undervalued. FinTech, undervalued. Crypto, undervalued. Can keep going on.

• 12:16David Weisburd?

  Let's start with consumer. Why are you bullish on consumer?

• 12:20Speaker 01

  I'm bullish on consumer because you have a next generation of founders, young Gen Z'ers who want to build stuff for themselves. They're tired of the existing set of brands or like online regimes. They're really tired. They don't speak, you know, to them and their generation. And also, nobody really today has managed to build something for Gen Alpha. Like if you want to hire today, the most amazing designer who has built legendary products for Gen Alpha, there's no company that you can go and hire from. In addition to that, thanks to AI, new hardware that's going to come out, we're going to be interacting with technology in ways that we can't even imagine. Young brains have an advantage when it comes to having unhinged imagination

• 13:03Speaker 01

  about designing new experiences for new markets. So I'm pretty bullish.

• 13:08David Weisburd?

  And what about other VCs? Aren't they also investing in this space? Why do you think that's undervalued?

• 13:14Speaker 01

  It's what Charlie Munger used to say, you know, "Show me the incentives, I'll tell you the outcome." So the venture capital industry now has a lot more firms and a lot more people than ever before. It's almost like a factory where it's like, "I'm investing in you and your company. What are you going to do for me in the next six to nine months? You need to deliver me a markup and show me a 23X markup." It's just harder to do that if you're the original versus you showing up at a demo day, picking what is the theme that is in vogue, and then three months later, you have a markup. So I think it's only a matter of time when you have enough of the awesome freaks who are building in consumer, that one year from today, you will start seeing the markups

• 13:59Speaker 01

  and everyone else will start flocking in.

• 14:01David Weisburd?

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• 15:22David Weisburd?

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• 15:59Speaker 01

  That's the whole game. So my partner, Michael, and I have a shared vocabulary about our pre-leading indicators of future promise and success to really make sure that the founders we're investing in are freaks. So we don't take any risk on the founders we're investing in, but we're very comfortable, as you said before, to take a lot of risk on the markets we're investing in. So what is the common trait of the founders we're investing in? Basically, in one day, they can learn, mature, make the progress that is takes the average founder a whole week. And why is that very important? Because when you're building for a new, new market, a market that doesn't have a name yet, and you have that kind of ability to learn and make progress, it's almost guaranteed that in two years from today,

• 16:44Speaker 01

  you will be the world expert in that new market.

• 16:47David Weisburd?

  I have this thought experiment of the Nepo baby. Second generation, wealthy kid, goes to Silicon Valley with the worst idea in the world, meets with every VC, and the VC wants a check from him in the future, from his family. So they give him actually good advice. By the end of a couple of months, he has a good business. Do you think that's true?

• 17:07Speaker 01

  I'm very pleased you asked me that question, and especially now, being in the best city in the country and the world, New York City. I do think that at the moment, in May 2026, Nepo babies or a founder demo that is underappreciated.

• 17:26David Weisburd?

  I'm intrigued. Why?

• 17:29Speaker 01

  For many of the reasons you articulated. You need to pick the right nepo baby, the one who has huge chips on the shoulders, because they're not the ones that are in line to take over the family business. The one that is really curious to do things differently. They're independent thinkers, but oh my God, you know, they have managed to be fluent and comfortable in rooms that another very young founder might take decades, if ever, to even get access to. If things are gonna go faster and you can have the beginnings of a business that has momentum, being a nepo baby, you can even further accelerate all that stuff.

• 18:10Speaker 01

  And in certain categories where you need to be able to converse with the government or large enterprise contracts with non-tech companies, those individuals can have a significant upfront that's over others.

• 18:26David Weisburd?

  I think in general, people underestimate information alpha and overestimate IQ. You could obviously argue the opposite. There's well-known cases where people with just exceptionally high IQs, like a Vitalik from Ethereum, have went on to be very successful. But information alpha, the way that I think about it is if somebody feeds you the information, you don't need to use the mental compute of a high IQ person to get to the same exact outcome that that high IQ person from First Principles would probably still take years and years to get to.

• 18:56Speaker 01

  Well said. And especially now that intelligence is becoming a commodity and the cost of tokens is coming down. You just have to have agency, you need to have great taste and access. Some nepo babies have all three. So right now, if you find the right one, invest.

• 19:13David Weisburd?

  Speaking of nepo babies. As you mentioned, you're one of the only VCs in the world investing to Gen Z in 2020, 2021. Today, you're really doubling down on Generation Alpha, the next generation. What differentiates Generation Alpha from Generation C and maybe Millennials?

• 19:32Speaker 01

  Look, we're all finding out as we go, right? And as you know, most of the Gen Alpha today, they're not even of like working age. So who are the Gen Z folks? The Gen Z folks are the ones who were born from 1997 until 2013. So afterwards, we have the Gen Alpha. So the Gen Alpha folks, we have not invested in anyone yet, okay? But we're investing in the young Gen Z years.

• 19:57David Weisburd?

  The youngest one is, the oldest one is nine years old.

• 20:00Speaker 01

  Anyone who was born after 2014, yeah, let's say 10, 12 years old, right? But we're investing in young Gen Z years who are building for Gen Alpha. Every generation has their own beliefs. And we're all products of the times and the markets we operate in. And these conditions shape us. So what Michael and I are open-minded is to update at all times our priors and find the singular individuals, the freaks, will be able to navigate and build something for their own generation with authenticity and credibility. We love to invest, of course, in very young people, but that's not the only demo we're investing in. I would actually say to you now, you're somebody who is a very commercial,

• 20:44Speaker 01

  but unfortunately for you, non-AI researcher, who is in your early 40s, tough luck. Nobody wants to meet you, even if you're a tenure professor at Stanford. You won't get a meeting with a VC.

• 20:55David Weisburd?

  Because it doesn't match the pattern of the last couple of years?

• 20:58Speaker 01

  Yeah, it's like standing, you know? Or you're a gaming founder. Like I went to GDC, the Game Developer Conference in SF, a month and a half ago. 50% fewer attendees than two years ago. Not only that.

• 21:13Speaker 01

  The founders who had raised pre-seed and seed rounds, they were willing to reopen the pre-seed round. And these are companies that have product-market fit. Why is that? Because no one in the VC industry wants to do gaming, which is a hedge structure to me, because gaming is larger than film, music, sports combined. And now with AI, the cost of content production for gaming is coming down. So like, what the hell?

• 21:41David Weisburd?

  It's hard for me to believe that all these reasons are purely memetic and just VCs following VCs. There should be some structural disadvantages to consumer, to gaming, to crypto today that's keeping the next generation of founders from building these large companies. But you would say, no, it's purely memetic. There hasn't been any big wins, so people aren't building.

• 22:02Speaker 01

  You got exactly right. And you've seen-

• 22:04David Weisburd?

  How could that be?

• 22:05Speaker 01

  It always is. It always is. Because all of us as humans are looking for the quick, easy wins. And you probably have seen that online. There is that chart that shows 2016. What was the hottest category? Autonomous vehicles. Which was, you know, the most successful viable company from that era? A company that had nothing to do with autonomous vehicles. So like, for every year, the most viable company that was founded that year was not the one that was in the hottest theme. So when I started in the venture capital industry in 2010, 11, over half of the GPs in every venture capital firm were only doing consumer investing. Just think about that.

• 22:45David Weisburd?

  And today?

• 22:46Speaker 01

  Today, very different. So like, from all the major venture capital firms, they might have half to one person doing consumer investing.

• 22:52David Weisburd?

  The large platforms.

• 22:53Speaker 01

  Yeah. Others, you know, who were legendary venture capital consumer investors, they completely got out of consumer. It's wild. Even Excel, back in the day, they had that awesome growth team that they were calling bootstrap companies anywhere in the country to invest in them. In the outreach demos, they were saying we're the first, the early investor in Facebook and all the consumer companies.

• 23:16David Weisburd?

  And you would explain this in that the reason they got out of consumer is not because there's not opportunities there. It's because they couldn't get the quick markups? Or why did they get-

• 23:25Speaker 01

  For quite some time, this was not where the next generation of amazing companies got started.

• 23:31Speaker 01

  That's why, but like I'm arguing that today, if we look back to this very moment in time, five years from today, some of the very best companies will be consumer companies. If anything, OpenAI is a consumer company, man. Just think about that. Or like Cerebras, right? You know, Cerebras.

• 23:46David Weisburd?

  One of our portfolio companies.

• 23:47Speaker 01

  Congratulations. So you're like the mind of the hour. It's been a phenomenal week, right?

• 23:51David Weisburd?

  Yeah.

• 23:51Speaker 01

  So when this guy got started in 2014, 15, 16, around that time, right?

• 23:56David Weisburd?

  Yeah.

• 23:57Speaker 01

  How many people were investing in semiconductors in Silicon Valley?

• 24:01David Weisburd?

  Not many.

• 24:02Speaker 01

  Practically no one. Like every firm that in previous generations, like a lot of the partners were only doing semiconductors. They had all been retired or like had moved on to new fields.

• 24:13David Weisburd?

  Let's say that I accept your premise that it's memetic and it's momentum driven.

• 24:18Speaker 01

  Yes.

• 24:18David Weisburd?

  You could also argue that it becomes self fulfilling. What do I mean? SpaceX builds its rocket. Now there are suppliers supplying space companies. Now there's actually a company that could take different things into orbits. So now you have literally companies like Varda, another portfolio company that does biology in space. Would have been impossible without SpaceX. Does that not start to build on itself and become its own self fulfilling prophecy? In other words, it could have been started, it could have become popular and become popular maybe for the quote unquote wrong reasons. But now it's a situation where you could actually build that business. And that's where the net new opportunities are.

• 24:58Speaker 01

  This could happen too. But Varda is trying to create a new market, right? Your portfolio company Varda is creating a new market on its own. So they could very well be super successful. And it's cheaper, it was cheaper to start Varda when they got started because they could put stuff in orbit. Before, they would have to be even more vertically integrated and could have been impossible, right?

• 25:18David Weisburd?

  Absolutely. So when I look at probably the most interesting mistake that I see a lot of smart VCs make, Joe Longzal has talked about this, is investing into the right founders with a clearly wrong business, expecting them to pivot. What do you think about the strategy? And do you ever invest into a company where you think that there's no way this could ever work?

• 25:39Speaker 01

  Look, there's a lot of paths to success and Joe Longzal is a legendary founder and investor. And there's very strong survivor bias in our industry. And sometimes when you're older and you've been around for long enough, you can also rewrite history, right?

• 25:58Speaker 01

  So what I would say to you, and from at least my humble experience, it's all about the people. The like what I think about their idea, what I think about their initial market. Actually, I don't care much because sure, you know, if I know more about that initial, you know, market than what they do, if those founders are freaks, within like two weeks, they will know more than me.

• 26:20David Weisburd?

  And you said that I have this thesis on founders that I think founder attributes, I think pretty much everybody knows what makes the best founders. What people do not know, unless they've been at a top firm for several decades, is the degree to those traits. And I have two examples for that. One is grit. Let's say there's 10 points of grit the average person has. And a founder might be thinking, man, I have two and a half times more grit than anybody, anybody that I've ever met. I'm two and a half times, I'm just unlucky, not knowing that founder actually needs 100 points or 300 points of grit. They're off by an order of magnitude of 10x. That's something that you can't, something that needs to be observed from the inside, almost impossible to observe from the outside.

• 27:03David Weisburd?

  The second thing is independent thinking, first principles thinking. It's almost, it's first principles thinking has now become such a tried and overused term. But a lot of people think, well, I'm smart. I'm extremely smart. I see a bunch of dumb people on TV. Clearly, I'm a great first principles thinker. And then when you look at the data, 50% of founders, last time I checked, were first or second generation immigrants, meaning they're thinking so differently that they grew up from outside the system. Both of us are immigrants. And then another, call it 20, 30% more controversial are neurodivergent. So 80% of the top founders, they're not thinking differently. They're not smart. They're not the smartest in the class.

• 27:45David Weisburd?

  50% of them have been like essentially socially shunned from society from a young age. Another 30% literally have a neurodivergency and just their brain is literally wired differently. And then obviously there's there's other 20%. But One of the things I think about on these founder attributes is people just can't internalize the scale of these attributes.

• 28:04Speaker 01

  Here's part one. One of the things I love about my partner, Michael Furtick, is that he's a freak himself. And growing up here in New York City, he played chess competitively as a kid. Who were his friends back then playing chess with him? Kids that they were described back then as the shy kids. How do we talk about them today?

• 28:22David Weisburd?

  It's a nice way to put it.

• 28:23Speaker 01

  Neurodivergent, autistic, on the spectrum. He said it really well. At least 20% of the mega outcomes in tech come from those people. What is my partner, Michael Furtick's reputation with them? You need to talk to Michael because he knows how to talk to people. As you know, those neurodivergent people, if they were to be having a conversation like us now, they might not be able to establish eye contact for 30 minutes straight. Or they might stare in your eyes and not say anything for like 20 minutes. This would make the average person feel uncomfortable with them. Michael is perpetual.

• 28:58David Weisburd?

  That's the other misconception I think people have about founders is they think, as you would call a freak or an epic founder, the same as a great person or a likable person.

• 29:09Speaker 01

  Yeah.

• 29:10David Weisburd?

  There's no correlation.

• 29:11Speaker 01

  No correlation.

• 29:12David Weisburd?

  In fact, some would argue there's a negative correlation.

• 29:13Speaker 01

  There's that concept, right? Like what makes a great founder is not necessarily what's going to make a great politician, second, third generation, you know, like later-stage company CEO. Because like if you're a founder, you need to have beliefs that at least in the beginning, nobody else agrees with you. You see the future very clearly and you want to bring to the world your version of the future. Whereas if you're a manager, executive, CEO in the making leader, you might want you not to be a people pleaser. And you're a glorified, you know, HR manager. And that's much harder. It's a different way. You train yourself about how you think of success day to day, every week, every year.

• 29:56David Weisburd?

  When you talk about these freaks, are they all idiosyncratic? They're just freaks in one thing? Or do they have some patterns in the things that make them freaks?

• 30:05Speaker 01

  The rate of learning for each one of them is astounding. But then they're

• 30:13Speaker 01

  Idiosyncratic. What the attributes that you mentioned, I did like. And I agree with perseverance. Like, any idea at some point in the future will be a timely idea. But you just need to be around long enough and be in the dominant position when the right time comes. So you need to have perseverance and greed in spades.

• 30:33David Weisburd?

  You came from General Callis, where you were there for 15 years. You saw one of the greatest firms in the world. Now you're building your own firm. What first principles do you bring to building Verdict?

• 30:43Speaker 01

  I had the privilege of a lifetime to having been part of GC from year 10 to year 25.

• 30:51David Weisburd?

  What was the AUM growth during those years?

• 30:54Speaker 01

  So when I joined GC in total, I had a billion and seven. GC was 10 years old. I was one of the founding team members of the Palo Alto office. GC back then had 35 people in total, 31 in Boston, where the firm got started, four of us in Palo Alto. And GC back then was only doing incubation, Series A, and some Series B investing. Chris Farmer and myself, who were two out of the original four, were tasked with bringing GC into the magical world of seed investing, which was a new idea back then. So since then, yeah, GC has emerged as one of the top five global franchises.

• 31:37Speaker 01

  And the motto there now is that we've entered beyond. GC is a global investment and transformation company today. So investing is part of what they do. They own a hospital, they took a public asset manager private, they own an AI transformation company, they fully own a wealth management platform, they fully own a public policy institute, and a lot of other wonderful things. So I do love the differentiation over there. AUM, I didn't know what the label is.

• 32:06David Weisburd?

  Close to 100, I think.

• 32:07Speaker 01

  Yeah, it depends on the public markets, but I think probably you're right.

• 32:12David Weisburd?

  So going back to Verdict, what lessons do you bring from GC to building your own firm?

• 32:17Speaker 01

  Ambition, entrepreneurial DNA, the power of relationships. GC was founded by two non-tech founders, David Fialco and Joel Cutler, who were incredible at building relationships with people from all different walks of life.

• 32:34David Weisburd?

  What does that mean exactly?

• 32:36Speaker 01

  It means that you deeply care about where somebody is coming from and building a relationship based on trust and not what is the transaction that we can facilitate right now and move on.

• 32:50David Weisburd?

  Especially in finance. So I look at everything on a macro level. If you understand the macro, you could predict kind of the micro. And this wasn't the case in VC before, but a lot of VCs now come from traditional finance, from investment banking and all these things. The second order effects of that, unfortunately, I think investment banking is a great training ground for people. I know a lot of people in Silicon Valley disagree, but I think it's actually more intense than most tech cultures, probably more than 99%. But the incentives there, the people that make it to second, third year, there's a very zero-sum nature to it. And it does not breed relationship or long-term oriented people. And that's very positive for people that are relationship and oriented that make

• 33:32David Weisburd?

  it through. Because I think when people talk about long-term greedy and being long-term thinking in venture capital, in pretty much any asset class, the bar for that is actually very low. The short-term greedy, greediness is so dominant that if you could think two to three years in terms of relationship, you're going to be top decile. It's almost the opposite of these founder attributes. The bar is so extremely low. And paradoxically, something that I have found, and people of course tried to game this, but the more long-term greedy you act, the closer, the faster you close business.

• 34:03Speaker 01

  Now, venture capital has become a career for so many people. The biggest issue in VC today, in May 2026, is that if you have a portfolio and you want those founders to raise capital from another VC, how can you make sure that that other individual will be in the role, in their seat for two more years? To separate them

• 34:27Speaker 01

  For the next round. It's one of the hardest problems today. So many people are treating their VC career day to day. Which deals can I do in order to move to another firm, start my own? There are very few people who want to be where they are because they have the long term thinking attributes that you mentioned. And they also understand the power of relationships for like a decade plus.

• 34:51David Weisburd?

  They're doing the corporate ladder.

• 34:53Speaker 01

  Corporate ladder. It's like, I'm in Seattle, I'm on Microsoft. How can I become an executive vice president? I need to do a couple of things in between. Amazon, back to Microsoft, then Amazon, then back to Microsoft.

• 35:05David Weisburd?

  It's Goodhart's Law, which is at some point, the metric becomes the driver.

• 35:11David Weisburd?

  There's no long term view. It's just, well, what could I measure? Well, I'm associate VP. How do I become VP? Clearly, that's the next step. That's the next step in the level. Therefore, I'm going to optimize on this metric because that's the only thing that I could think of.

• 35:23Speaker 01

  Yeah, and that's actually easier to see, right? Because it's almost in front of you. Slinger. You can grab it, slinger.

• 35:29David Weisburd?

  How did the founders of GC, how did that help them build the firm? So what does it mean to be relationship oriented in the context of VC? And what are the second order effects of that?

• 35:38Speaker 01

  They get started in Boston. They had a very high trust in this whole team because all of them were friends since they were like in high school and they had started several companies together.

• 35:49Speaker 01

  One of the second order effects was that they turned out to be amazing at fundraising. And sure, when the times are good, everyone is amazing at fundraising. But when the times are rough, like in the financial crisis, that's when certain VC firms manage to elevate and separate from the rest. And GC was one of them.

• 36:09David Weisburd?

  And do you think that was a fundraising skill? Or is that a relationship building skill?

• 36:13Speaker 01

  Relationship building skill.

• 36:16David Weisburd?

  I find it's very difficult to gain very large checks. Not that I've tried, just observing. I think the best bluff is no bluff. The best way to show that you'll have a good relationship with someone is to treat them well through different time periods. There's no shortcut.

• 36:29Speaker 01

  There's no shortcut. That's why you need to understand where they're coming from, how they think, and what really motivates them.

• 36:37Speaker 01

  Sometimes, you know, we as human beings, we say one thing, but we do something else, right? So you need to really understand what motivates that person.

• 36:44David Weisburd?

  You have to first understand yourself.

• 36:45Speaker 01

  Yeah, self-awareness is one of the hardest things to muster, yeah. And investing, to an extent, is a journey in self-awareness.

• 36:55David Weisburd?

  I love this whole practice of looking at how I behave and then questioning why I behave that way, and then starting to bridge the gap between what I think drives me and what actually drives me.

• 37:08Speaker 01

  That's right. So I had the privilege of meeting Charlie Munger several times. And Charlie Munger's Warren Buffett's longtime business partner, who unfortunately passed away recently. So one of the pieces of advice he had given me when we're discussing about managing your calendar, managing your time, and I explained to him, I'm in the business of meeting so many people in hopes that I can find a freak, is like, you're out of your mind, that's not going to work, it's about the 10 big decisions that you can make in your life. So try to ask yourself the following question. Would the 80-year-old self, would your 80-year-old self be happy that you put that person in your calendar before you actually do that with anyone?

• 37:52David Weisburd?

  So taking a 50-year perspective.

• 37:55Speaker 01

  Correct. Because when you're older, you don't have the benefit of having a lot of time, and you also don't have a lot of energy.

• 38:03David Weisburd?

  Similar to that, the best framework I got from a previous two-time guest, Alex Hermosy, he's a big on YouTube, and I think one of the most underrated minds in private equity and finance in general. And he uses this thought experiment that it's etched in my brain, which every day I wake up and I say, what is the one thing that I could do today that'll make everything else completely irrelevant? What is that next thing? Obviously, that doesn't mean you don't, that doesn't mean that you skip all your calls, but just constantly re-asking, is this the one thing? And you get to some really interesting takeaway. So I actually had, just sitting where you're sitting, I had James Montgomery, also close friends with Charlie Munger. He had breakfast with him for 10 years, every weekend. And he started this Montgomery Summit.

• 38:48Speaker 01

  Of course.

• 38:50David Weisburd?

  And through this question of what is the one thing that we could do that's tax, me and my business partner Curtis, we decided we're going to do a conference. One day, we woke up and we realized so many of our friends were doing conferences, whether it's Ron Biscardi from iConnections, or Jamie, or Max Greenstein from GB Stakes, or even our friend Brent that was doing a Tax Alpha Summit. And then you basically execute on that one thing. But it goes back to this whole career ladder and incremental thinking. Sometimes it's very non-obvious, what is that one big thing that's going to take you to the next level?

• 39:26Speaker 01

  Agreed. And that's why I think there are some pre-leading indicators to that. So what if you start asking yourself every day, what did I learn today? Or what if every morning that you get up, you write down the two things you need to do? And you actually do them. These are the small things that if you actually accomplish every day, oh my God, it's inevitable that you will become successful.

• 39:47David Weisburd?

  I have a Google Sheets, very tech sophisticated, where I write the two, the most important things every day.

• 39:53Speaker 01

  Excellent.

• 39:54David Weisburd?

  The other thing that I've learned that's very counterintuitive is that working in the business distracts you from working on the business. Said another way, small thinking competes for the same brain space as large thinking.

• 40:07Speaker 01

  Yeah.

• 40:08David Weisburd?

  So what does that mean? How do you actually operationalize that? Because I started reflecting, why do I always get the best ideas on the weekend? Is it because I'm going biking? Is it because I'm outside? And I realized it's because I don't have the day-to-day tasks that are basically taking all my compute. So now I try to recreate that during the week. I go to the sauna and I try to completely wipe my brain free of busy work. And lo and behold, I start getting ideas during the week as well.

• 40:34Speaker 01

  Great practice. Have you thought about starting rating yourself?

• 40:38David Weisburd?

  Rating or?

• 40:39Speaker 01

  Yeah, it's just like writing down. So for example, you know, if one of the key things you care about tracking is big idea thinking versus ordinary way of doing business every day, you can rate yourself at the end of the day, did I do that or not?

• 40:55David Weisburd?

  I think we actually, we actually do the opposite. So we celebrate shitty first versions. That's one of our cultural norms, because the hit rate is so low, but the upside is so big. Just to give you an example, and this is a dumb example, but it is telling. We do five episodes a week. We do five LinkedIn posts about the episode. I had an idea to embed the YouTube directly in the episode to basically help with the algorithm in the YouTube. We did that. It was a long shot. You're not supposed to do that. There's all these algorithm reasons. We just said, hey, screw it. We'll try it for one episode. That's been a huge success. And this is a success that compounds every single episode. If I held myself to the standard of did it work or not, or if I held myself to this like 50% of the time, I should be right, there's no way I would do anything like that.

• 41:38Speaker 01

  Look, many of the good ideas that turn out to be brilliant start in the beginning as a toy, something stupid, something controversial. So like I have that as part of my thesis for investing in consumer. So yes, like it's like what I like to do is like every day to rate myself for the key dimensions of what I want to do. Because that's how I, at the minimum, hold myself accountable if I'm making progress or not. My partner, Michael, is even more extreme. He's like, today, I made a decision. I wrote something. I exercised. Like he has like four dimensions and every day he's tracking.

• 42:17David Weisburd?

  You're training your LM without the backwards looking advice.

• 42:20Speaker 01

  That's right.

• 42:22David Weisburd?

  If you could go back 15 years ago, when you had just started at General Catalyst, what is one piece of advice, timeless advice, you'd give yourself that would have either accelerated your career or helped you avoid costly mistakes?

• 42:39Speaker 01

  Cold email your way to success.

• 42:42Speaker 01

  It's the one piece of advice I would give.

• 42:43David Weisburd?

  Any examples?

• 42:45Speaker 01

  Whoever you look up to at any given moment in time, reach out to. Like I reached out to Elon Musk when I was a Stanford student. I cold emailed pretty much all of the most awesome founders that I've ever invested in in my early years, like the founders of Discord, the founders of Snapchat. This is something that anyone on the planet can do, especially in the world of business. If you even work at a place like New York City or San Francisco, you have no excuse.

• 43:17David Weisburd?

  Speaking of cold emails, I think I cold emailed you about eight years ago. So it's been great to build a relationship with you. Congrats on the spin out and looking forward to doing this many times more.

• 43:28Speaker 01

  Thank you so much, David. I appreciate you.