20VC News: Anchor Founder, Mike Mignano Joins Lightspeed as Partner: The Future of Social Media | Why Clubhouse Has a Challenging Model | Why TikTok Could be a $2TN Company | Why BeReal is Defensible | What Happens To OpenSea in a New World for NFTs

Mike Mignano is a Partner @ Lightspeed, one of the most successful venture firms of the last decade with a portfolio including the likes of Snap, Affirm, Epic Games, Mulesoft and more. As for Mike, prior to venture, he was Head of Talk for Spotify where he led the podcast, live, and video businesses for the world’s leading audio streaming platform. Michael came to Spotify through their acquisition of Anchor, a company he co-founded and is credited for democratizing podcasting globally. Mike has also been a prolific angel investor with a portfolio including Cameo, Pipe, Sandbox VR and Stir. In Today's Episode with Mike Mignano We Discuss: 1.) Exclusive News: What exclusive news does Mike have to share today? What would Mike most like to change about the way founders experience the product of venture capital? How can VCs be better? What is Mike most nervous about in the new role? 2.) The World of Social is Changing Forever: Why does Mike believe there has never been a better time for the next social media giant to be born? Why are the largest social giants leaving behind the social graph? What is recommendation media? Why is it a better business model? How does the shift from social graph to recommendation media change the way large social giants operate and interact today? 3.) Startups: Risers, Fallers and Is There Room For Another Giant? What does Mike believe Clubhouse did well? What was their undoing? Does Mike believe BeReal is defensible? What features make it both sticky and defensible? Will TikTok be a $2 trillion dollar company? Will Meta catch TikTok or have they gone too far ahead? Will OpenSea be able to sustain and make the market for NFTs, despite crypto crashing? Should startups be concerned about large social giants "copying" their features? What does true defensibility look like in consumer social today? 4.) Angel Investing: Hits, Misses and Lessons: From writing over 50 angel checks, what are the single biggest lessons Mike has learned? What has been his biggest hit? How did that change the way he thinks about investing? What has been his biggest miss? In what way did that change how he invests? What advice does Mike give to all angel investors looking to invest today?

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

• 0:00Harry Stebbings?

  We are back. I hope you had an amazing Labour Day weekend. Welcome to 20 VC with me, Harry Stebbings. And what a show we have in store for you today. Today's guest has some incredibly exciting news. I'm not going to do a spoiler despite me really wanting to. All I will say is it's a joy to welcome back Mike Mignano to the hot seat. When I first met Mike, he was the co-founder of Anchor, often credited for democratising podcasting globally. In 2019, Anchor was acquired by Spotify and since he's been the rock star head of talk for Spotify, where he led the podcast, live and video businesses. Mike's also been a prolific angel investor with a portfolio including Cameo, Pipe, Sandbox VR and Stir. And as I said, no spoilers on the news, but this is an incredible discussion on the future of social and content, and was just immensely fun to do.

• 0:45Harry Stebbings?

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• 1:29Harry Stebbings?

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• 2:13Harry Stebbings?

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• 2:56Harry Stebbings?

  But now I'm so excited to hand over to the one and only Mike Mignano.

• 3:05Speaker 01

  You have now arrived at your destination.

• 3:08Harry Stebbings?

  Mike, this is such a joy to do. I've been looking forward to this one for a long time. It's been a long time since our last episode, but thank you so much for joining me today.

• 3:16Speaker 02

  Thank you for having me, Harry. Yes, I remember that first interview we did. It was probably six years ago. I don't even know.

• 3:23Harry Stebbings?

  I know, I feel like Dorian Gray. I was young and looking back in those days. But we have some very exciting news today. So I'm just going to hand over to you and say, tell me, what is this wonderful and exciting news that you have for me today?

• 3:34Speaker 02

  Yes, thank you. So today we're announcing that I'm actually joining Lightspeed as a partner on the consumer team. And I will be based here in New York City. And also as a fund, my partner, Justin Overdorf, announced today that Lightspeed is going to be planting a flag here in New York City and opening a brand new office. So that's the news and thank you for letting me share it on 20 VC.

• 3:53Harry Stebbings?

  You've had an amazing career so far with Anchor and with Spotify. You could have chosen many funds to go and work at. Why did you choose Lightspeed?

• 4:00Speaker 02

  So I've been angel investing for about three years now. And I definitely wanted to kind of take my investing to the next level and join one of the world's best and most storied venture platforms. In talking to a lot of them and partners that I knew at different funds and talking to a number of different funds throughout this process, I really felt like Lightspeed was you. Unique in that we are number one, truly global and we have been for more than 15 years. The past decade has obviously been in a big way about the US and the companies coming out of the US. But I really believe that the future is global. So it was really important to me to join a global platform. I wanted to join a fund that had really deep domain expertise across a number of different areas.

• 4:41Speaker 02

  I'll tell you that when I was building Anchor, I always appreciated investors who actually had real world experience and they weren't just check writers. I also wanted a fund that was really strong on partnerships and not egos. A thing that we did in Anchor was we had this thing missionaries, not mercenaries. And it was very clear to me that Lightspeed was similar. Lastly, as I was going into this new role and looking at the landscape and the market, and obviously we're in a period of uncertainty in the market right here. I felt it was really important to join a fund that could support teams at every single stage. Full stack support, Lightspeed invests in every stage. And so between all those things, it just made so much sense for a number of reasons. So yeah, I'm really excited.

• 5:18Harry Stebbings?

  New things are always nerve wracking. When you think to like the next few years and becoming a VC now, having been an angel and an operator, what are you most nervous about?

• 5:26Speaker 02

  So I think it's really easy to be pretty loose with angel checks, if I'm being honest, right? It's your money, you're answering to nobody else. The checks are relatively small, so it feels less risky. But obviously with venture, and you know this way better than I do, you've been doing it for a while. You're investing other people's money and now you're not just investing for yourself. You're investing for others who are trusting you to make really smart decisions. And not only that, but if you're leading venture rounds, you're obviously joining boards. So you're signing up for a very meaningful and long-term partnership. The stakes are much higher and so all this will be new to me. And like anything, there's always going to be a certain level of anticipation. So that's probably what I'm anticipating most.

• 6:05Harry Stebbings?

  So you mentioned boards there. I've sat on many boards.

• 6:07Speaker 02

  Yep.

• 6:07Harry Stebbings?

  I've only sat on one that has actually provided any value out of about 15. So I think boards can be done better in venture, along with most of the actual product itself. What do you think can be done better in venture, having really dog tested it, if that's a word, as a product?

• 6:21Speaker 02

  Yeah, so one of the things that I think we did really well at Anchor was we built this culture of very direct communication, built on mutual respect. And I think Venture could use a little more of that personally. I think it could use more directness between founders and investors. I think if founders had a better understanding about what investors' goals were, it would probably enable investors to be more transparent. I didn't like the culture of investors milking relationships with founders when they never had any intention of investing. I also never liked how investors were so opaque about reasons they're passing. My sense is like, we're all adults in this industry, yet I find people are so afraid to hurt each other's feelings that they avoid directness of communication. So I'm

• 7:03Speaker 02

  really hoping to bring more of that. I think investors don't often realize that it's really hard for founders when you don't know where you stand. And having been in that situation many times, I can tell you it creates lots of tension, lots of additional pressure. I want to bring the types of candor and directness to Venture that we really had when building Anchor, which I think was a big part of why we were successful.

• 7:24Harry Stebbings?

  Where do you think there are a couple of situations where founders don't know where they stand, where it's critical that they should know where they stand?

• 7:30Speaker 02

  Well, I think the pitching process, obviously. That's a process that I think could use way more efficiency. I think working with existing-

• 7:38Harry Stebbings?

  Sorry, I've got better at interviewing, I think, I hope. Maybe I'm more annoying. How could that be better? What would you like to change there?

• 7:43Speaker 02

  The pitching process could be faster and more efficient, and investors could be more transparent with the reasons they're passing. I think that would help founders improve and actually probably result in a better outcome between the investors and the founders in a future round, right? If a founder knows the real reason why an investor is passing, they can work towards achieving certain goals that might make it a better fit in the next round, right? Another example I would say is, I think founders sometimes don't know where they stand with their existing investors, and whether or not investors are going to be excited to back the next round, or if it's off-strategy for them. There should be more discussion and conversation about what the future relationship might look like between a founder and investor. I think there are a number of situations like that.

• 8:23Harry Stebbings?

  I'm jumping in here.

• 8:24Speaker 02

  Yeah, go for it. You're an investor. Tell me if this is realistic.

• 8:27Harry Stebbings?

  Well, I mean, so like first off, like the reason that investors aren't as directors, they should be most often in terms of the feedback is because they want to retain the optionality. If you're a multi-stage fund, you don't want to say, Mike, I'm turning you down at the seed because I really don't believe that actually you have what it takes. Because they don't want that founder to not come back to them at the A or the B in case they turn into something great. So they want to have a bland vanilla reason that is not enough for you to be dissuaded.

• 8:52Speaker 02

  Of course.

• 8:52Harry Stebbings?

  So that's reason one. What were your other ones?

• 8:55Speaker 02

  But you should just say that then. You should just say, I don't believe in this company yet. What I'm seeing now, I don't think you have what it takes, but I'm hoping you can prove me wrong.

• 9:03Harry Stebbings?

  The hard one and that I do struggle with, what if it's, I don't believe in you?

• 9:07Speaker 02

  I think you should say that.

• 9:11Harry Stebbings?

  Ooh, that is deep.

• 9:13Speaker 02

  It's the truth. I think you'd be respected more from the founder if you told them that directly.

• 9:17Harry Stebbings?

  What about, you know, the hard thing about being in a partnership is you can want to do a deal, but your partner will say no. That is a very difficult situation to be in.

• 9:25Speaker 02

  I think you should tell the founder that as well because the founder doesn't often know that. They actually don't know the dynamics. And this is what I meant earlier about like the investors' goals. I think the investor should explain to founders like what the dynamic is, how deals get done, what their incentives are, what kind of ownership structure they want. These are all hidden variables that make it very hard for the founder to know what to deliver to the venture capitalists to get the investment.

• 9:48Harry Stebbings?

  Mike, I'm a founder and it's me that you don't believe in. You're a VC, it's your first pitch at light speed. How do you tell me that you don't believe in me?

• 9:55Speaker 02

  I think I would say, listen, Harry, I think that this is a really interesting business. I think there's a ton of opportunity here. I don't believe that you're the person to do it. Now, you can change my mind through this next stage to the next round, but right now I just don't think you have what it takes and I wish you all the best of luck.

• 10:11Harry Stebbings?

  What matters more, market or founders?

• 10:13Speaker 02

  I think people underestimate the potential of a market to develop and evolve. A reason we heard often with Anchor was this is not an interesting market. Podcasts have been done before. But I think that ignores what podcasts can be, right? I think this isn't a big enough TAM is like a very easy excuse to give to a founder. But the reality is all of the biggest markets were never as big as they were until the defining companies made them that way. And so it's probably. Probably the founders.

• 10:39Harry Stebbings?

  I think a huge market can cover a lot of sins on the founder's side. That said, whenever an investor says, I think you're amazing, but the market's not big enough. A truly amazing founder would expand the market, would find the

• 10:51Speaker 02

  Exactly.

• 10:52Harry Stebbings?

  Within it, would do something to make it bigger. You've worked with some of the greats on the investing side. Did you get advice before you entered and before you joined Lightspeed in terms of what it takes to enter venture and be a VC?

• 11:04Speaker 02

  Absolutely. One topic that I find is often discussed when I'm talking to investors about this is the pace at which an investor should make their first deal. I I've heard a wide range of suggestions on this one. Some have told me you should wait a whole year before doing your first deal. On the other hand, another investor, one in my mind, one of the all time greats, told me recently, assuming you see a great deal and a great company, you should write your first check in the first sixty days. And his reasoning was that if you wait too long, you create this pressure cooker scenario where you start to overthink your strategies and your motivations and your filters and your decision making. And so by making that investment early, you're ripping the Band-Aid and releasing that pressure before it builds.

• 11:43Harry Stebbings?

  Where do you land on that? How fast to write the first check?

• 11:46Speaker 02

  Today's my first day. I'm open for business. And so I think I err more towards the side of moving quickly rather than waiting a year, especially because I feel like I've gotten to practice. I know angels not the same thing as venture, but I've gotten to practice investing a bit over the past couple of years. It's not like I'm starting completely fresh.

• 12:03Harry Stebbings?

  I have so many thoughts on this one because like that's often cited that actually your first check's always going to be actually not a very good one. It's a bit like V1 of your product. You're going to look back on it in five years and go, I probably wouldn't have done that. In which case, just do it fast, get it out the way.

• 12:17Speaker 02

  Exactly.

• 12:18Harry Stebbings?

  And move on. But then I've also had it in the past, Mike, where my first institutional check was not very good. And it actually damaged my confidence for quite a while and I was hesitant to deploy more because I was nervous. And then you have the alternate school of thought, which is actually, Mike, just do a series C that's pretty humming alongside other great people and get a B plus under your belt. I don't have an answer for you, but there is your multiple choice.

• 12:43Speaker 02

  I appreciate that. Yeah, when I was building products, I naturally gravitated more towards the iterative approach, right? Like, don't overthink it, ship the product, get it out in market, you're gonna learn, you're gonna know your mistakes, you're gonna, you're gonna adjust based on that. I think my inclination is to take a similar approach to invest, to investing, where it's like, get your reps in, you're gonna learn, it's a journey, right? It's a marathon, not a sprint, and then go from there.

• 13:04Harry Stebbings?

  How many checks do you wanna write a year, Mike?

• 13:07Speaker 02

  I think I'll probably write a handful of maybe early-stage, and let's call it seed checks, and then a handful, a small handful of, call it As and Bs as well per year. I think mostly on consumer, look, it's a partnership.

• 13:20Harry Stebbings?

  You said about your experience came from zero to one there. I'm not sure if you know this, but when I was like 18, 19, I was in SF, and this was when Anchor was so hot. Every VC wanted to talk to you, and I wanted to ask you, when you have the venture and the tech world praising you in those hype moments, what do you, and what did you tell yourself?

• 13:37Speaker 02

  I think it's important to acknowledge upfront that when we found ourselves in that situation that you're talking about, I remember it very, very vividly. We had never been in that situation before. I had never started, it was my first time building a company, first time building my own product from scratch and launching it to the world. And like you said, there was tons of hype, pretty much overnight, like the day we launched it. If you've never been in this situation before, it's really easy to get ahead of your skis and think you've won. We wanted to be the social network for audio, right? So there was already a social network for photos, that was Instagram. Video had YouTube, et cetera. We wanted audio to have Anchor. I will admit, in those first few weeks, we had thought we had won, because all of the biggest and most respected luminaries in

• 14:19Speaker 02

  tech, people I'd only ever seen on Twitter, never met in real life, were telling us that we had won. They were telling us that we were the biggest company in the world, and they were flying across the world to bump into my co-founder and me at random events to try to get us to take their money. And so it's very easy to hear all of these super respected people tell you that you had figured it out. But the reality is, which we didn't know at the time, is that they're actually speculating, and they're betting that you will win, not that you had already won. And of course, what happens is, you know, once the hype dies down, all the noise drops, and you're able to see the real metrics, and like, what's Actually happening. And so you have to sort of swallow your pride and reorient yourself and re-anchor yourself, no pun intended. And remember that this is a marathon. You gotta swallow your pride and you gotta get back to work.

• 15:03Speaker 02

  Success comes over time. It is never an overnight thing.

• 15:07Harry Stebbings?

  How long was that hype cycle?

• 15:09Speaker 02

  So I think when we first launched, it probably lasted two months. And then I think we spent a good six to eight months constantly trying to recreate it. And bring it back and do these little things to get that spark back. It never did. And you know, at a certain point, you look at your runway and you're gonna run out of money. You're gonna let down not only your investors, but your employees or accounting on this company to provide for their families. And you realize that you have to do, you have to do something dramatically different. You're, you're in this existential moment and you have to address it. And that can be a very, very powerful forcing function for turning the company around and doing the right thing.

• 15:45Harry Stebbings?

  We've seen quite a few consumer social companies gain very mass adoption, huge popularity and hype. Whether it's your anchor, you know, obviously a while ago, and then there was like, I think Pop Shop or Pop Show, I can't remember what it's called. That kind of was very hot. And then there's obviously Clubhouse, which was very hot. You know, there's been many, I'm just kind of regaling from my past memory. But none have broken out into Facebook, Instagram, Snap. Is there room for another, given their ability to copy so effectively as they're trying to with BeReal now? Is there room for another? And will we see a next gen social giant or actually not?

• 16:18Speaker 02

  I think we will. And if you had asked me this question about a year ago, I may have said no. I think there's this thing happening right now. I recently wrote about this trend called recommendation media. Where the biggest social platforms in the world are actually pivoting more to be recommendation engines. And really more like entertainment platforms. I think as a result, there's going to be sort of this vacuum of true social experiences. And so I think if ever there was a time for a new startup to emerge, to create a great new groundbreaking social network or social experience. Now is the time. Literally the most iconic social media company of the past 15 years. Facebook literally just walked away from their social graph, right? They're pivoting to recommendation media. They've been very, very public about this.

• 17:01Speaker 02

  And so if there was ever a time to place a contrarian bet and lean into being the next big social platform, this is probably that time.

• 17:08Harry Stebbings?

  I get you. How do you think about the copycat approach from incumbents? And is that a legitimate worry for the up and comers?

• 17:15Speaker 02

  Yes, 100%. I think it is a worry. Admittedly, I think it is a worry for BeReal. I think BeReal is a great product. The reality is, I don't think their format is something that Instagram can't copy easily. It is a photo at a specific time of the day. I think in order for a platform, a new social platform, to win is really to have a defensible format. And the reality is, I can't tell you what that defensible format is because it doesn't exist yet.

• 17:38Harry Stebbings?

  On BeReal, I can. I think the defensible format, the albums that they allow you to create, which is a newer feature. So you can look back on all your previous BeReal and see the album across a longer period of time.

• 17:50Speaker 02

  That's really cool.

• 17:51Harry Stebbings?

  And so in a similar way that Airbnb had reviews, which you don't want to lose when you wouldn't switch away from Airbnb because you'd lose all your reviews, you'd lose your ratings, your rankings. With BeReal, you'd lose all of your past historical BeReal over a three-month period. And actually, I think Instagram, it's not natural for them to integrate a separate BeReal Mike Mignano page in a separate profile. It would be very awkward. You'd almost have two profiles, a daily profile and then your longstanding. It doesn't make sense in my eyes.

• 18:19Speaker 02

  By the way, that's a great example of building a defensible format where it's hard for another platform to go. You know, a lot of people like to talk about Clubhouse now and how, you know, whatever, it didn't work out. There was this hype cycle. It's over. But to give Clubhouse a lot of credit, I actually think their format was pretty unique and pretty defensible in that it would have been very hard for Twitter and Facebook or Meta and Instagram to easily replicate that format in a way that made a lot of sense with those platforms. Obviously, it didn't necessarily work out the way everyone thought. But I think that's actually for completely different reasons, not for the lack of defensibility of the format. And so I think the key for a new social network to break out is it has to do something different that is hard for another platform to travel to. And arguably, no platform did this better than TikTok, right? They built a new toolset, which ended

• 19:03Speaker 02

  up creating a new type of format that obviously was and is copyable. It's all just software. Software can be copied. But as we've seen, it's Taken meta a little bit to get there. It's taken them a couple of years and it's given TikTok the time to grow into one of the most defining platforms in the world right now.

• 19:19Harry Stebbings?

  Why do you think Clubhouse didn't work out? It's where we reconnected after many years.

• 19:23Speaker 02

  That's true. It was. So I think that live content is extremely challenging. This is not unique to audio. Live in general on the internet, I think, is a flawed format. If it's just live, only live, and there's no asynchronous component, I think it just becomes a really challenging math problem. You're basically saying, in order for this thing to get scale and to achieve a large amount of value, and I'm talking about this thing being the content, a lot of people need to be available to consume this thing at this exact moment. What the internet has showed us is that there's way more value that gets generated in asynchronous content because it can be consumed on somebody's own schedule. Arguably, this is why Spotify has been so massively successful, or YouTube, right?

• 20:06Speaker 02

  It's because you can fit into any calendar and any schedule now. You don't have to have somebody be available at any given time. And so I see a lot of criticism of Clubhouse online that I don't fundamentally agree with, which is, oh, they didn't focus enough on the community. They didn't nurture the community enough. I actually don't think that's the case. I think the format was flawed from the beginning. Totally cool of them to try it, and I think it was amazing. But I think in order for it to have maybe worked a little bit better out of the gate, they probably needed to go to on-demand asynchronous playbacks, or whatever they call them, replays from day one.

• 20:38Harry Stebbings?

  It's not quite an easy feature. You could essentially record every room and have a repository, a library where you could go into tech, you could go into art, sports, and look at the historical for the last week.

• 20:49Speaker 02

  There's two things I'll say about that. Technically, yeah, it's kind of easy. On the other hand, you know, I can tell you that when we were a three-person startup, there's only so much you can do in a given day, right? You really have to focus, and they were getting so much traction. And I have to imagine that it was hard even just to keep the servers up. So I can empathize with the fact that they have to focus. Secondly, I can also tell you from the Anchor days, replays of audio is also a tricky place for them to be. Again, I said that the live Clubhouse format was unique, and I agree. That's somewhat defensible in terms of uniqueness, but what is not unique is on- On-demand consumption of a long-form audio file, which feels and sounds kind of like a podcast. The thing that we saw in the early days of Anchor and still saw up until when I recently left Spotify was

• 21:32Speaker 02

  listening habits of podcasts are very, very hard to break. If you are an Apple Podcast listener, you're almost definitely never going to switch away from that. If you are a Spotify listener, you're almost never going to switch away from that. Now you've got this other app, Clubhouse, which is putting out all these on-demand asynchronous audio files, which kind of sound like podcasts. Are you really going to leave Spotify to go listen to this one audio file? When Spotify has all the audio files? It was a bit of a paradox, I think, for them, in my opinion.

• 22:00Harry Stebbings?

  I think fundamentally, it goes down to the question of quality of content. And the truth is, if you are doing live content in the way that Clubhouse was, it is not as high quality as researched, as edited. I have a core metric, which is word to value ratio. Every sentence you say has to deliver value, and if it doesn't, it gets edited out. These are edited shows. But in Clubhouse, that's a brilliant question, Mike. I've been thinking about it for a long time. And across the many months I've been thinking about it, for fuck's sake, just answer the fucking question. Seriously. And then also, I think we're forgetting, this was like a freakish social change in how we behave.

• 22:32Speaker 02

  Hundred percent, yeah.

• 22:33Harry Stebbings?

  We were trapped in COVID at home, like we were lonely as anything. And so I totally think that's a problem.

• 22:38Speaker 02

  A thing that a lot of people did in Clubhouse was talk about Clubhouse. I think there's actually a fundamental reason. I think, but I think there's a reason for this. And I think it goes to your point in that producing high-quality audio content is hard. It's hard to come up with content to talk about. So if you're sitting on this stage in this live room in front of a thousand people, and you're not sure what to talk about, it's easy to go to, hey, this platform's pretty interesting, huh? It's just like an easy topic to reach for. So I totally agree with you, like, producing high-quality audio content is really hard. And obviously, we've learned that in the Anchor journey.

• 23:07Harry Stebbings?

  I'm not nearly as deep as you in this, but you said about kind of the incumbents moving away from the social graph towards the recommendation.

• 23:13Speaker 02

  Sure.

• 23:14Harry Stebbings?

  We saw, you know, last week, Snap actually announced shutting down Zenly, a completely bizarre decision in my mind. Forty million users, incredible team, no idea what's going on there. Sorry, I know that's a light speed company, forgive me. But my question to you is, why are these incumbents moving away from the social graph when it served them so well and it's the core of their very good business?

• 23:34Speaker 02

  Because I think it's, it is not defensible anymore. It's actually very easily commoditized. There are a number of reasons here. It used to be that The way that content got distributed on these platforms was through your social graph. Let's just use Facebook as an example. You would join Facebook, you would get a hundred friends and you would post a piece of content and it could instantly distribute that content to those a hundred friends. And arguably, that distribution was guaranteed. Gave you a lot of power in terms of distribution and programming. In reality, it's actually not that efficient a means of content distribution. Just because you can distribute a piece of content to me doesn't mean that it's going to resonate with me. In fact, it might not resonate with me at all. And in fact, it might be problematic. It might be a piece of content that has hate speech in it or something that needs to be moderated.

• 24:18Speaker 02

  And so what these platforms were doing was they were effectively giving away free distribution that that was more or less guaranteed, potentially very expensive for them in terms of content moderation and maybe not really that efficient in terms of engagement, in terms of driving ROI for the business. Well, then TikTok comes along and they say, hey, forget the social graph. This thing is not that efficient. We're going to determine the efficiency. We're going to program every single piece of content so that it has the lowest cost for us in terms of content moderation or whatever, and the highest engagement in terms of ROI. And we're going to basically instrument maximum revenue for the platform, right? And so I think what platforms are realizing is that this is actually just like a much more efficient business model for them.

• 25:01Speaker 02

  And not only that, the social graph, as I said, is completely commoditized. Now, every social product that comes out can instantly have a social graph just by ingesting your contacts list, right? So you and I meet on the street somewhere, you say, hey, Mike, what's your phone number? I give you a text. Now I'm in your contacts. You sign up for Be Real or some other new social platform and boom, they have your social graph already. So the thing that Facebook built 15 years ago that was so defensible and so unique at the time is just not the unique anymore and it's a bad means of content distribution.

• 25:33Harry Stebbings?

  There's many things I want to unpack. I'm laughing at this chat. You said the content being posted. It is a complete fallacy that with 500 hours of YouTube videos submitted every minute, YouTube, Google, anyone is able to moderate the content efficiently at that scale. Am I not wrong and is it just completely unfair to respect them to?

• 25:53Speaker 02

  You're right. Here's the difference, though. When the platform has control over the distribution, they don't owe the distribution to anyone. Yes, there may be a problematic piece of content, but if it's problematic and they're getting takedown requests, just bury the distribution. Just bury it and nobody will ever see it. Whereas if somebody puts out a piece of content that's doing really well and it's not getting takedowns, dial it up, increase the distribution, increase the ROI. The difference is in social media, they can't make that decision because they're on the hook to distribute the content to those hundred friends, regardless of whether or not it's expensive in terms of moderation, or it's not engaging in terms of value and ROI. So the moderation still exists, but they're not on the hook to deliver it anymore. They can just bury it.

• 26:35Speaker 02

  And they can use machine learning to pattern match and know which types of content to boost and which to bury.

• 26:40Harry Stebbings?

  On TikTok, I don't think I've ever been as bullish on a company as I am on TikTok. I'm a dick, but my sister and my mother.

• 26:47Speaker 02

  It's amazing.

• 26:48Harry Stebbings?

  It's fucking amazing. And so my question, and do you know there are compound startup as well in the like Rippling Style, like they have all inbuilt tools, like they rebuilt Slack for themselves.

• 26:59Speaker 02

  Oh, I did not know that, actually. That's interesting.

• 27:01Harry Stebbings?

  Every single tool completely vertically integrated. I mean, it's insane.

• 27:05Speaker 02

  That's really cool.

• 27:06Harry Stebbings?

  Do you think TikTok will be a $2 billion company?

• 27:09Speaker 02

  A $2 billion company? Did you mean two billion?

• 27:11Harry Stebbings?

  Sorry, two trillion.

• 27:12Speaker 02

  Okay.

• 27:13Harry Stebbings?

  That's pretty. Do you think it'll be a $2 billion company? I think you're behind that.

• 27:17Speaker 02

  You know, you know what's cooler than two billion? No. So here's the thing. I think the next couple of years are the battleground. So Facebook, Meta is now saying, we're coming into this space. I think right now TikTok has the advantage because they invented this format, they've popularized the format. But the reality is, the elements that will end up being critical on this battleground are ocean of content from which to do matching and recommendations, and best-in-class machine learning and computing power. There's no doubt that Meta, one of the most valuable companies in the world, can definitely have both of those things. So I think right now, if TikTok can fend off Meta for the next couple of years, they do have a shot at being one of the most valuable companies. But I'll be honest, I think Meta has just as good a chance as them or anyone else

• 28:02Speaker 02

  to displace them over the next couple of years. So I think this battle sort of will be won over the next, let's call it 24 months.

• 28:08Harry Stebbings?

  When we think about the starting point for a lot of these social tools, all great social platforms start with a tool that enables creators to create. So for them, it was filters on pictures. For others, it's, you know, the ability to, you know, medium, it's the ability to write freely in beautiful editors, you name it. Do you agree with that idea that the best social platforms start with creator tools?

• 28:31Speaker 02

  I do agree, and I learned this. In the early days of Anchor, we just gave people a microphone and we sort of cut them off at two minutes. We didn't give them any tools. And we found that people did want to create. Admittedly, the content was not that good, and so it didn't drive an audience at all. It was, it was like, you couldn't listen to it, to be honest. And where we really saw gains and started to see the potential for something really big was when we gave people creative tools, when we gave them the superpowers to do things that they couldn't previously do. And the moment we did that, they sounded like professionals, and it motivated them to want to create more, and it motivated people to want to come and listen. And so if you can do that successfully, you can build a really, really big business. The key is, as we talked about a little while ago, can you build a defensible format that Meta can't just copy with the flip of a switch?

• 29:13Speaker 02

  Because if they can, then yeah, you're dead before you really have even gotten anywhere. But if you can create something defensible, that is the recipe for building a really sustaining and long living platform.

• 29:23Harry Stebbings?

  Speaking of those creative tools, I have to ask you again, despite being a creator myself, I'm not bullish on the creator economy, and I'm not bullish on the creator economy for the simple reason that I think it follows the most extreme version of Pareto's principle, where 99% of revenues accrue to 1% of creators. I'm very grateful to be in the 1%.

• 29:43Speaker 02

  You've done a great job.

• 29:45Harry Stebbings?

  But my point being like, you know, I turned Down Riverside, the platform we're on now, because it's like $30, $40 to, to use every month. For a creator that makes $100, $200 a month, it's just too much. And so are the majority of creative tools. And so you're tailoring yourself to the 1%, which is not a large enough market. And actually, there's very niche verticalized products for each, so there's little expansion opportunity. Why am I wrong and why should I be excited?

• 30:10Speaker 02

  I agree with you completely about some of the challenges you just mentioned with Creator Tools. I recently had a conversation with Ben Thompson and we were talking a bit about this. And if you think about recommendation media and the shift to algorithms away from follower counts, right? Follower counts was where a lot of the value was accrued over the past, let's say, decade. Now you have all these creators, or let's call them influencers on Instagram and platforms like these that effectively don't have control over their business model anymore, right? It used to be just let's increase the follower count. Now they're kind of stranded. What this necessitates are tools and services that enable these creators to build new types of business models. And so having a direct relationship with the fan or the customer ends up being much, much more valuable.

• 30:51Speaker 02

  And so I'm excited about platforms that enable influencers to take control over their entire business and not be reliant on algorithms and advertising that comes out of those algorithms to get paid. Because as we've seen now, Meta can just change their mind with the flip of a switch and your followers don't mean anything anymore. So I'm really bullish on tools like that. The other thing I'll say is, to your point, there's a lot of talk about how Web 3 will enable creators to increase their take rate because the platforms are taking too much. I will be honest, I think this is the complete wrong problem to be solving right now. To your point, we don't need to worry about the 1%. The 1%, like, God bless them, they're able to make money. There are actually millions or tens of millions and maybe hundreds of millions of people

• 31:35Speaker 02

  that haven't yet even earned a dime. And so if we want to create a creator economy, right? Economy implies a very large sustaining ecosystem of commerce and transaction and monetization. We need to worry about the millions or tens of millions, not the tiny 1% who are already making lots of money. So that's what I like to think about. I like to think about the tools to enable those creators.

• 31:57Harry Stebbings?

  I totally agree with you in terms of the long tail and allowing that monetization they don't have. I think one interesting one is-

• 32:02Speaker 02

  End distribution, sorry, end distribution.

• 32:05Harry Stebbings?

  Well, so I either say, so whenever I meet Creator Tools or anything in the Creator economy, I say, hey, unless it does one of two things, I'm not interested. It either needs to make creators money or it needs to bring creators distribution. If it's not one or two-

• 32:16Speaker 02

  Totally.

• 32:17Harry Stebbings?

  Peace out, goodbye.

• 32:18Speaker 02

  Yep.

• 32:18Harry Stebbings?

  But no, I'm totally fucking wrong. I turned down Riverside. This company is fantastic, the product is amazing, what a mistake. I also turned down Descript, the editing tool which Andreessen did. Fire products. Now, are either of these multi-billion dollar companies? I don't know. I use them daily and they're amazing.

• 32:35Speaker 02

  Well, the thing that I'll say about both of those companies, and I like them both a lot as well. I really like the products. I've used Riverside a bunch. I really like Descript. Is they're different business models. So we're talking about tools to enable like the long tail of creators. What these products are trying to do, they're trying to be Adobe. And if you look at Adobe, Adobe is a really valuable business, right? If you can create really, really great tools and charge like a SaaS style of subscription, you could have a pretty valuable business. Now, I think you need to do more than just like remote video recording and that's it. And in the case of Descript, you probably need to do more than just like text-based audio editing. And I know they are doing a lot more. But best-in-class tools for creators, it can be a pretty valuable business.

• 33:17Harry Stebbings?

  I get you. My question is, I'm so loving this. This is like, but the unbundling of Adobe is a fascinating one. Cause you have absolutely right Riverside in one way, Description in another. You've got Canva now coming into a lot of that space. You have Figma.

• 33:31Speaker 02

  Capwing, Capwing, Figma.

• 33:34Harry Stebbings?

  Capwing, Figma, Canva, they're all eating it side by like in different verticals. How do you think about the unbundling of Adobe? And is their size and scale enough to keep the ship running?

• 33:46Speaker 02

  I think it has to get unbundled and then rebundled again. I think one of these companies will successfully take a strong position in say video or audio editing. And they will inevitably need to leverage that strength to ladder into a new vertical, right? And take a step over in a new direction and then hopefully establish a leadership position there and then ladder into the new. I mean, that's how all of the best companies grow. Amazon started as books, right? Then they take a step over into AWS, right? And then they take a step and then they take a step over into, you know, whatever, media. And before you know it, it looks nothing like it did in the early days of the product. And so I think the best companies in this vector will need to do the same thing.

• 34:22Harry Stebbings?

  We said about building new relationships and having different business models. Twitter tried to do this with super follows.

• 34:28Speaker 02

  Yeah.

• 34:28Harry Stebbings?

  You know, your manifestation of your Twitter followers. I saw Chris Messina, you know, kind of the famous Twitter.

• 34:33Speaker 02

  Yeah, of course.

• 34:33Harry Stebbings?

  Creator. He was supposed to earn about a hundred thousand dollars a year from his Twitter audience. And he ended up earning thirty six dollars, which I thought was mildly entertaining, not in a nasty way, but just like the inefficiency. How do you analyze that as a new channel and why it's broken down in many ways?

• 34:50Speaker 02

  I wonder if maybe there's not enough differentiation in terms of the format or the content that gets delivered for the super followers versus just the regular followers. We're talking about a two hundred and eighty character piece of text. I don't think there's a lot of precedent to suggest that that should be worth a subscription. I think there has been precedent to establish that maybe like a long form essay or a newsletter is valuable. But I don't know that Twitter has yet proven to consumers that tweets should be worth that.

• 35:20Harry Stebbings?

  Can I ask you a question? It's I think Spotify is one of the best products companies in the world. I think it's got the best leadership team in the world. I'm so bullish on Spotify.

• 35:28Speaker 02

  Love Spotify.

• 35:29Harry Stebbings?

  Did they miss a trick on social? And just, I mean, fascinated from the discussion we've just had. How would you apply that to Spotify and your lessons from being there for three or four years?

• 35:39Speaker 02

  Well, we just said that social is in some way commoditized. And so I think if Spotify were to have done this a couple of years ago, it maybe would have been the wrong bet. I think it would have been the wrong bet. However, if you think about where the future is headed, I think Spotify is in a great position to benefit from the shift to recommendation media. As we've been talking about, Spotify has been doing M L, machine learning based content distribution and discovery for a really long time. They did this very, very successfully with music. They arguably reinvented how all of us discover and listen to music through machine learning. And now they're doing something really interesting on the podcast side in that they're making it really easy for anyone to create. And we talked about earlier how the best recommendation media platforms need an ocean of content to be able to program.

• 36:23Speaker 02

  And Spotify is effectively doing that. They bought Anchor, which obviously I'm biased. It's the company that I founded. But Anchor enables many, many millions of people to create. Podcasts that never would have been able to create podcasts before. And so there's this huge, long tail of podcasts emerging that didn't exist before. They're trying other things like, I don't know if you saw the test that they launched a few months ago, but they put a podcast create button in the actual Spotify app, removing yet another layer of friction to create a podcast. So you could imagine a world in which Spotify is enabling anyone to create. And they end up with a huge, huge, huge ocean of content through which they can program to their listeners based on trends and machine learning and their listening habits and things like that.

• 37:05Speaker 02

  And so I think Spotify is sort of ahead of the curve of this recommendation media thing. They've sort of been doing it for a really long time.

• 37:12Harry Stebbings?

  I think it's the most underrated feature in Spotify. It's the go to radio. When I'm on a song that I love. I saw it on Twitter once and I was like, I've never done that before and I love it. It's brilliant. I do want to touch on your angel investing because I could talk to you all day. How many checks did you write as an angel?

• 37:28Speaker 02

  I've done about 50 so far between all the companies I've invested in and advised. It's about 50 companies that I'm working with.

• 37:35Harry Stebbings?

  Okay, so 50 investments as an angel. What have been your biggest takeaways from those 50? And how did it impact your mindset moving towards being a venture investor?

• 37:44Speaker 02

  I wanted to build a portfolio. I learned from my days fundraising for Anchor about the power law dynamics of venture investing. It was really important to me from day one to actually build a portfolio and not just go like super deep, a select few in just one area. So if you look at my investments, you could see there are some common themes, but they're pretty well spread out. The other thing that I wanted to do was I wanted to be really consistent with how much I invested. So I wrote the same check size every single time. And the reason that I did this was I think you can get into a trap of altering the check size based on your conviction. But the reality is like at this stage, the angel stage, they're all super risky. Like regardless of your conviction, any of them could go to zero and any of them could potentially blow up.

• 38:28Speaker 02

  What I felt was it was better to sort of like equal out the check sizes to give you more bullets in the chamber, rather than try to predict which one has a higher success rate and doubling down. That's kind of what my approach has been. And of course, like I've learned things over time, like, you know, there are certain categories that I'm, that I've become less interested in and other ones that I've become more interested in. But I think like anything else, it's just something you have to do a lot of to learn about it.

• 38:51Harry Stebbings?

  So I'm so with you on the consistency of check size. It's one of the biggest mistakes that I see angels make. When you started, did you set aside a certain amount that you wanted to invest?

• 39:00Speaker 02

  I left it pretty open-ended, I will be honest, which my wife doesn't come from the world of technology and investing. So having that open-ended pool of capital to angel invest, I think made her a little nervous at first, which I totally understand. But no, I didn't set aside an amount. I just keep writing them.

• 39:14Harry Stebbings?

  So when you look back, everyone makes mistakes, it's the nature of a portfolio. What would you say your mistake was and what did you learn from it?

• 39:22Speaker 02

  So I'll give you two. One is having been a founder, I really like to back founders that are super mission-driven. They've experienced the problem personally. They want to be the change that they want to see in the world, that whole thing. And those are the types of founders I like to back. Somebody who I really trust, and I still trust to this day, I don't hold this against this person, came to me and said, hey, there's this company, they've modeled this out, these guys have done this before. It's basically what I like to think of as like a spreadsheet startup. Somebody like figured out the model for a startup and they gave the spreadsheet to a team that wasn't necessarily passionate about the problem and said, go build this. It was one of my early checks and it didn't work out. And like I said, I don't hold it against the person. But that was a mistake I made. It taught me that I need to stick to the mission-oriented founders. And then

• 40:04Speaker 02

  maybe another sort of like small tactical annoying thing, a mistake I made early on was that in the early days of writing checks, I wasted my time and money on reviewing the legal docs. Like I would hire lawyers and get them to review it. And then I pretty quickly learned that these are all pretty standard docs. And as a tiny check writer, I can't influence them anyway. You just have to trust, if you're working with a lead that's like a major fund or like a major law firm, you just trust them and you sign them. Don't waste tens of thousands of dollars on legal fees.

• 40:32Harry Stebbings?

  Oh, for sure. Totally. That was a terrible idea. Can I, you said mission-oriented there. Everyone sells a great game. I've got this. I've felt the pain in my old job. I felt the pain in my, this is my mission. It's not most of the time. How do you truly determine mission-oriented founders?

• 40:50Speaker 02

  I think you really have to like know them. And maybe this is obvious. You have to do your reference checks. You have to do off-book reference checks. You need to really get to like the heart and soul of the person. Yeah, you're right. It's really easy to just sell something, right? If you're a great storyteller, you can just roll into a room and just, this is my mission. I like to really get to know the person. I like to spend a lot of time with them. I don't like to just quickly make decisions. And yeah, the truth is sometimes you can get it wrong. You could find out that the person is full of shit. But I think if you spend enough time with a person and you really try to know them on a personal level, you can tease out whether or not it's genuine.

• 41:22Harry Stebbings?

  Final one. What was your biggest miss as an angel? And did it change how you think about it?

• 41:27Speaker 02

  I really wanted to invest in OpenSea early on, right up my wheelhouse. Naturally, in founding Anchor, I'm a big believer in platforms that lower the friction to enable people to create and distribute and monetize and things like that. And it was pretty clear, I think, at the beginning of this NFT craze that like OpenSea could be that sort of winner takes all. That would do that for a new type of creator, a visual creator that could now monetize their work through NFTs. And so that was one I didn't get to invest in. I was bummed about that. I really liked the team as well, but you live and you learn, right?

• 41:56Harry Stebbings?

  We said about kind of moving away from the social graph and the changing nature of the social landscape. We look at NFTs today, largely the dominant use cases around social capital of having a crypto punk, you name whatever, chain runner, whatever we want to have. How does that social capital associated to NFTs tie into a changing world of social and moving away from social graphs?

• 42:16Speaker 02

  The reason I like OpenSea and NFTs is not because of what you just said. I am not long-term bullish on the social capital aspect of the NFTs. I'm more bullish on the creator-based use case of it. The reason I liked NFTs was because you look at art. I'm just using art as one use case, but you could apply NFTs to a number of different use cases. You look at art and you see that there are naturally tons of people in the world who are making art. But it's really hard to monetize, right? If you're not a great artist or you don't, you know, you're not great at rubbing elbows with people in your local art community and getting in with galleries and things like that. It's really, really hard to monetize your art. You couldn't monetize your art on the internet before NFTs came along. You couldn't just take one of your paintings or your drawings or your digital art and put it up on the internet and monetize it.

• 43:01Speaker 02

  NFTs, maybe as a byproduct, because maybe it is more about what you're saying, enabled artists who had never been able to monetize their work to all of a sudden have a very willing potential customer base that might be willing to pay them lots of money for their work. You know, I have this friend, John, John Januzzi. He's been an artist his whole life. I actually didn't even know this about him. He went to school for fine art. He got a job in fashion and he actually worked at Twitter for a while. But on the side, he's always been a passionate artist and just never did anything with it. When NFTs comes along, he creates this collection of art and he puts it up and like overnight, he's generating hundreds of thousands of dollars, he's giving half a foot away to charity and all of a sudden he's motivated to create. That's the aspect of NFTs I really like. I like the ability to empower creators.

• 43:45Speaker 02

  I'm personally less bullish on the social capital, look at my board ape, I'm so special component. Because I think that's not truly scalable.

• 43:52Harry Stebbings?

  Why do people buy his art?

• 43:54Speaker 02

  Well, I think some of them bought it because they like him. Some of them bought it, yeah, because of the social capital. Some of them wanted to get in early and speculate, which is also something I guess that does go hand in hand with art in some way. It's not the thing that excites me about NFTs, I guess is what I'm saying. I think the thing that excites me is the democratization for the creator side.

• 44:13Harry Stebbings?

  I'm not so bullish. Web three, I think, no, no, no. Web two is fine. I like web two.

• 44:18Speaker 02

  I like web two as well. I, you know, I built a platform, you know, I worked at Spotify for many years. I think web three can make sense for certain use cases, but I don't view it as a panacea for everything. I believe in infrastructure and that's another thing that Lightspeed is doing that I'm excited about. They've been investing in crypto and web three for a while. I do think it will be an important component of the internet, but I don't know that anyone can predict the specific use cases today. The better bets are on things like infrastructure.

• 44:43Harry Stebbings?

  A final one. OpenSea obviously facilitates buying and selling NFTs. I think they reported $5 million in transactions over a certain time period and it was $485 million in the peak of the boom. What happens to OpenSea in such volatile markets, both in terms of crypto and NFT, obviously because the price of Ethereum dictates a lot of the transactions? What happens to OpenSea when seemingly hype cycles is not immortal from?

• 45:07Speaker 02

  So like we talked about at the beginning of the conversation, they were throwing off crazy revenue a year ago or whatever it was. But like I learned with Anchor, like these moments can be fleeting and this is a marathon, not a sprint. The game's not over, as I'm sure they're doing because they're, you know, smart teams, smart founders. I'm sure they're back at work trying to think about the next five years of the product, not what happened last year. And I think the best team will recognize that it's a long-term game and maybe the worst teams will fizzle out and try to grasp onto the thing that worked a year ago, but maybe isn't working today.

• 45:37Harry Stebbings?

  It goes back to our question on market versus founder and actually OpenSea as a company cannot will a market into existence.

• 45:44Speaker 02

  Yeah, with Anchor, you acknowledged that we sort of pivoted. I think it was a really important lesson to learn. At a certain point, you have to stop trying to get the world to want what you want it to want and you need to give it what it needs and what you're uniquely positioned to give it. Now, fortunately with Anchor, we found ourselves In a position where we recognize that people just really wanted to make podcasts and they wanted it to be easier. And the stuff we had built could be retrofitted to do that like perfectly. So that's great, but you can't really force the world to sort of buy what you're selling.

• 46:17Harry Stebbings?

  I totally agree. It's like, Vanshi, you can't force a founder to take your money sadly. Listen, Mike, I love this. I want to move into a quick fire answer. I say a short.

• 46:24Speaker 02

  Sure, let's do it.

• 46:25Harry Stebbings?

  So what's your favorite book and why?

• 46:27Speaker 02

  I have lots. Right now I'm reading the first Harry Potter to my six year old daughter and we are loving it. And I had never read Harry Potter before and I'm having a blast right now with all like the character development and stuff. I'm like 20 years late on this.

• 46:39Harry Stebbings?

  How did becoming a father change you?

• 46:42Speaker 02

  So when you become a parent, especially as a founder, you think it's actually going to make your job way harder, but it's actually the opposite. It helps you to focus. It really snaps into focus what's important in life and helps you prioritize your time just way, way better. So I think it teaches you about the priorities that you should be valuing in your life.

• 47:00Harry Stebbings?

  What is the secret to a successful marriage?

• 47:03Speaker 02

  So I think this could apply to marriage, but also lots of other important relationships, like great friends or maybe a co-founder or a partner. And that is listening, not just always trying to fix, right? I think I'm a builder and so naturally like I always want to fix everything. But I think what I've learned as I've gotten older and I've been with my wife now for, you know, 15, 17 years or since we first started dating, whatever it is. And I've learned a lot over time. Relationships are built on listening and actually like empathizing, not on action. I mean, obviously action is important as well, but sometimes people just want to be heard and you really need to listen and stop trying to make everything about you and about what you can do to fix a situation and you really just need to listen and hear people. And so I, I think that's the key.

• 47:46Harry Stebbings?

  Harley, president of Shopify, said exactly the same. So.

• 47:49Speaker 02

  Oh, really?

• 47:50Harry Stebbings?

  Exactly the same. Who's the most underrated angel in the ecosystem and why?

• 47:54Speaker 02

  Maya Prohuvnik. She was the first employee at Anchor. She now runs talk at Spotify. She's amazing because she is probably the most empathetic product leader I know. She knows better than anyone else I've ever met in my life, what will resonate with users and what won't. I told you earlier on, I really like to be this like zero to one type investor. She's also really, really great at that. She just knows what will resonate with people. She has a great ability to put herself in their shoes.

• 48:20Harry Stebbings?

  I would love an intro to her. She sounds fantastic.

• 48:22Speaker 02

  You got it.

• 48:23Harry Stebbings?

  Tell me, what's your biggest strength and your biggest weakness?

• 48:26Speaker 02

  It's probably the same answer to both. I have a tendency to become extremely passionate about things. I really pour my whole self and my heart and soul into things. Now, that's obviously a strength because I can get like really good at that thing and I could become like the expert at the thing. But it's also a weakness because other aspects of my life can then suffer as a result, right? I just, I go all in on something and then everything else has a tendency to get blocked out.

• 48:49Harry Stebbings?

  Someone told me once, a wise elder, that when you're winning at work, you're losing at home. And when you're winning.

• 48:54Speaker 02

  Totally true.

• 48:55Harry Stebbings?

  Yeah, I do that one too. Tell me, what would you most like to change about the world of startups?

• 49:00Speaker 02

  We talked about a lot in this conversation, how I really like products that lower the friction for people to create things. I'm always excited about things that make it easier for people to start companies. I want the friction to drop even lower. For me, an absolutely life-changing experience to be able to start a company and build a product. And so I really love products and tools and services that help founders lower the barriers even more. And I've made a couple of investments in the space.

• 49:24Harry Stebbings?

  What's the most recent angel investment and why did you say yes and get so excited?

• 49:28Speaker 02

  I recently invested in a company called Stardust. It's a women's health product, first focused on period tracking, secure, end-to-end encrypted, privacy-centric. Amazing female founder, mission-driven, a couple of things. First of all, like I said earlier, I'm just really drawn to really strong, mission-driven leaders and people that really know what they want to build. And so for that reason, I was really drawn to this company. But you know, I think it matched a theme that I see happening, which is I think encryption is becoming a really important consumer-centric feature. Unfortunately, it's happening for somewhat cynical reasons, right? I mean, it's clear that mistrust of institutions is only going up. And I think this is going to force people and users to seek much, much more control over their data and their privacy.

• 50:12Speaker 02

  And I think the founder of Stardust had this insight as well. Shortly after I committed, sure enough, she was right. Again, this is not for a good reason. This is actually for a very, very bad reason. Roe v. Wade was overturned shortly after. Horrible thing and something that I think is a real travesty here in the United States. And almost immediately, she saw tons of people were sort of flocking to these new women's health apps that were really privacy centric and encrypted and end to end because they now were worried that their privacy and their data may be taken advantage of by these big platforms for reasons that the users weren't comfortable with. So that's an example of a recent investment.

• 50:48Harry Stebbings?

  Why has no one built a big business in this market? Everyone's been going off to period tracking for years. Clue in Germany been doing it for years. Pretend we're in a partnership. Why has no one gone big? It's a strategic acquisition for any big European healthcare buyer, insurance provider. It's not a $10 billion company here.

• 51:03Speaker 02

  So I think that we talked earlier about how there's sort of like this bundling and unbundling that happens. I think you asked about why hasn't there been a big period tracking app? I actually view it more as a health product and a health service. And I think period tracking is one potential vertical for a company to really establish a great product. But in order to build a $10 or $20 billion business, that business then needs to ladder into new categories and new verticals, establish strength in that vertical and then again ladder up into the new strength or the new vertical and establish strength there. I view it more at one offering in a suite of health products and services. And obviously there have been countless massive, massive health businesses.

• 51:41Harry Stebbings?

  Mike, I've loved this. It's been such a natural discussion. It's not followed our schedule at all. But it's been a joy to have you back on the show. I'm so excited for your time ahead with Lightspeed and thank you for joining me.

• 51:52Speaker 02

  Thank you for having me, Harry. It's been a blast as always.

• 51:57Harry Stebbings?

  I mean, I so love doing that show. I think you could tell from the discussion that it was so much fun for me to do and I hope that Mike enjoyed it. You can find more about Mike on Twitter at Mignano, founders. Mike is just fantastic. Could not recommend more highly. So absolutely check out at Mignano on Twitter. But before we leave you today, Harvard Management Company is constantly seeking out the next generation of great investors and entrepreneurs. HMC has managed Harvard University's endowment for nearly 50 years and was one of the first institutional investors in venture capital. Their experience and long-term investment horizon makes them ideal partners to get world-changing ideas on a path to viability. And success. They work as a true partner, providing insightful perspectives to help managers succeed.

• 52:40Harry Stebbings?

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• 53:23Harry Stebbings?

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• 54:08Harry Stebbings?

  And their track record includes the likes of Airbnb, SpaceX, Palantir, and many more incredible companies. So head over to marketxventures.com to unlock a world of incredible later-stage private market investments. That is marketxventures.com. As always, I so appreciate all your support and I cannot wait to bring you an incredible 20 Sales episode this coming Friday.