20VC: The 3 Things LPs Want To See From VCs & Why The Table Stakes For VCs Is Higher Than Ever with Judith Elsea, Co-Founder @ Weathergage Capital

Judith Elsea is a Co-Founder @ Weathergage Capital, one of the world's leading fund of funds with over $950m AUM. Prior to Wealthergage, Judith was Chief Investment Officer of the Ewing Marion Kauffman Foundation from 1993 to 2001. As CIO, she directed a $2 billion globally diversified investment portfolio, committing over $600 million to US early stage venture funds and other private equity partnerships. She was also instrumental in the creation and implementation of the Kauffman Fellows Program, a global apprenticeship program designed to train the next generation of venture capitalists. In Today’s Episode You Will Learn: 1.) How Judith made her way into the world of LPs and what makes her think venture is such an attractive asset class? 2.) What gets Judith really excited when viewing prospective fund managers for potential investments? What differentiators does Judith look for? 3.) What are the most common reasons Judith finds for her rejecting fund managers for investment? What are they not doing and how can they optimise this? 4.) To what extent do LPs have a commitment to invest in further funds having invested in one fund? Are there any situations where this changes? 5.) What are the similarities and differences between fundraising for LPs vs fundraising for startups? How should the different elements be approached? Items Mentioned In Today’s Show: Judith’s Fave Book: Patrick O'Brian Judith’s Fave Blog: The Twenty Minute VC, a16z, Founder Collective Judith’s Most Recent Investment: Felicis Ventures As always you can follow Harry, The Twenty Minute VC and Judith on Twitter here! Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC. Eve make 1 perfect mattress – made with 3 layer technology and next generation memory foam. It comes packaged in a beautiful box and arrives the day after you order. You get 100 nights to try it with free return pick-up – it really is the perfect mattress for everyone. Just go online to evemattress.co.ukand enter the code 20VC for £50 off. Everybody deserves the perfect start with Eve. Cooley are the global law firm built around startups and venture capital. Since forming the first venture fund in Silicon Valley, Cooley has formed more venture capital funds than any other law firm in the world, with 50+ years working with VCs. They help VCs form and manage funds, make investments and handle the myriad issues that arise through a fund’s lifetime. So to learn more about the #1 most active law firm representing VC-backed companies going public. Head over to cooley.com and also atcooleygo.com.

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

• 0:00Harry Stebbings?

  Welcome back to another week in the world of the 20 minute VC with me, Harry Stebbings. You can add on Snapchat at H Stebbings to see snapstorms on funding advice, having interviewed over 500 VCs, personal branding tips and tricks, and of course, Mojito Masterclasses. But to the show today, and this one really was a special one for me, the guest is one I've long admired and respected for her incredible work in the LP community, and since our meeting, she's been so kind as to help and advise me in my personal journey, so for that, I'm incredibly grateful. So joining us on the show today is Judith Elsea. Now Judith is the co-founder of Weathergage Capital, one of the leading fund of funds with $950 million under management, and prior to Weathergage, Judith was Chief Investment Officer of the Ewing Marion Kauffman Foundation from 1993 to 2001.

• 0:45Harry Stebbings?

  As CIO, she directed a $2 billion globally diversified investment portfolio, committing over $600 million to US early-stage venture funds and other private equity partnerships. She was also instrumental in the creation and implementation of the Kauffman Fellows Programme, a global apprenticeship programme designed to train the next generation of venture capitalists. And as I said, a true legend of the industry, and I want to say a huge thank you to Beza Clarkson at Sapphire Ventures for the introduction today to Judith. And I must also add, if you like reading from the amazing world of LPs, you must check out openlp.com by Beza, it really is my must-read every morning. However, before we begin the show today with Judith, many things make up great venture funds, great LPs like Judith, great GPs, and also a great legal team behind the fund.

• 1:30Harry Stebbings?

  And that's where Cooley come in, they are the global law firm built around startups and venture capital. And since forming the first venture fund in Silicon Valley in the late 50s, Cooley's helped more firms than any other law firm in the world with over 50 years working with VCs. They help VCs form and manage funds, make investments, and handle the myriad of issues that can arise throughout a fund's life cycle. So to learn more about the number one most active law firm representing VC-backed companies going public, simply head over to Cooley.com and also check them out at CooleyGo.com. However, whether you're a VC, a lawyer, or an LP, or anyone really, sleep is imperative, and that's where Eve come in. Eve is the UK's number one Direct-to-consumer mattress company because they don't sell through high street stores.

• 2:14Harry Stebbings?

  Eve cuts out seventy percent of traditional costs and pass those on to you and I, the consumer. Developed over four years with thousands of prototypes. Eve is so confident of their product, they give customers one hundred nights to try it at home before committing. For those of you that don't love it, they even offer a free return pickup with full refund. So there really is no risk. Simply go to eve mattress.co.uk, enter the promo code twenty VC for an incredible fifty pounds off and it'll be with you the next day. However, enough from me and it's now time to hand the mic over to the wonderful Judith Elsia, co-founder at Weather Gauge Capital.

• 2:53Speaker 01

  You have now arrived at your destination.

• 2:56Harry Stebbings?

  Judith, it's such a pleasure to have you on the Twenty Minute VC. Huge thank you to Beesa for making the introduction today, but thank you so much for joining me today, Judith.

• 3:04Speaker 02

  Oh, I'm very excited to be here, Harry. I love what you're doing and and thrilled that you would ask me to participate. Thank you.

• 3:11Harry Stebbings?

  Well, thank you so much and and we all love LPs, but it's not the traditional career path to choose growing up. So I'd love to get started today by hearing how you got interested in the venture ecosystem and why you think it's such an interesting asset class.

• 3:25Speaker 02

  Yes, you're right. It's certainly not a traditional career path, especially, you know, back when I started. But I've really always been interested in how things work and how things fit together and by economics and the various motivations of economic actors. And and, you know, somehow the investment business lends itself to, you know, that kind of curiosity. So I've been in the investment business for quite some time now, including stints as a portfolio manager of public equities, as a CIO of the Ewing Marion Kauffman Foundation and now as one of the four co-founders of a VC and growth equity fund of funds called Weather Gauge Capital. So parenthetically, we we started Weather Gauge in two thousand and six.

• 4:06Speaker 02

  We're on our fourth fund and we have some nine hundred and sixty million dollars of assets under management. But what really interested me in in venture was when I used to run, you know, a public equity portfolios.

• 4:20Speaker 02

  For a while, it was really hard to get excited about your job if you had to spend time wondering if Walmart was going to miss or beat earnings by a penny. You know, for me, my introduction to venture came through the Kauffman Foundation. But the startup world is so much more interesting and potentially rewarding than anything I was doing in public equities, or frankly, even a lot of the other asset classes that I've trafficked in. And I think that's because entrepreneurs are taking these big risks every day, trying to create new stuff, and some of it's trivial, but some of it's extraordinary. And I just think that's fascinating. And if you'll permit me an example of that, because I often use Uber, and Uber's an extreme example of pretty much every pathology you can think of.

• 5:04Speaker 02

  But really, no one knew that the limo and taxi business needed disrupting, certainly, much less that it could even be done with all the regulatory barriers. And certainly, no one knew at the time that ride sharing wouldn't allow so many people to profit from their unscheduled time and previously underutilized resources. And certainly, no one knew at the time that doing all this would warp the auto and insurance industries in really material ways, and now they're moving into self-driving cars and trucks. And all of that can end up reshaping cities and warping our notion of public transportation. So not every startup has this Uber-scale impact, but most large company incumbents

• 5:47Speaker 02

  are really just worried about how many shares are going to buy back every quarter. Truly, entrepreneurs are working hard on the stuff that really pushes society forward. Most of the time, they fail, but sometimes they succeed, and I just really honor that struggle. That's sort of the intellectual underpinnings of my interest in venture and the startup and the creation process. But there's money to be made if entrepreneurs and investors get it right, and so this is the economic underpinning of my interest in venture. There is this enormous renaissance in innovation, both IT and life sciences now, and it's extraordinary. We think it's quite durable, it will be quite long-lasting and meaningful. But really, how do you get it?

• 6:30Speaker 02

  Exposure to these opportunities. Well, there's almost only one way to do it. And that's through young private companies and many of them are venture backed. So there's an intellectual underpinning to my interests, but there's also an economic underpinning to my interests.

• 6:42Harry Stebbings?

  And out of pure interest, I'm I'm too intrigued. One of my friends in Europe is raising a fund of funds. How was the LP reaction to Fund of Funds itself? And how did you avoid the kind of traditional perspective of some LPs that it's a middleman game?

• 6:58Speaker 02

  Well, it is. Our reaction to that is if you want exposure to the kinds of opportunities I just outlined. You know, they generally do come from young private companies and many of them are venture backed. There are a lot of venture funds out there, but of course there. And we think a broader number of them will are positioned to produce really good returns. However, you know, the opportunity set for top quality opportunities in venture in both the US and I'm sure in Europe. Is not a large one. And so for us, uh, we provide a vector into that world. And we like to think that we earn our keep by doing something for our LPs.

• 7:40Speaker 02

  That they can't do for themselves, or they can't do for themselves in the quantum in which they would like to have exposure. People find it, this is an important aspect of their portfolio. And it's difficult to prosecute prosecute the opportunity uh yourself. Many people can, but many people can't. And so we like to do things that that people find valuable, but they can't execute on their own.

• 8:04Harry Stebbings?

  And I'd love to cut the show in half today and discuss and discuss manager evaluation for the first half. And then discuss some questions for the LP community in the second. How does that sound?

• 8:16Speaker 02

  It sounds great.

• 8:17Harry Stebbings?

  So let's start with evaluation then. And and I'm often told by managers, uh, Harry, LPs look for one thing, cash on cash. So to what extent do you think this uh summarization is true?

• 8:31Harry Stebbings?

  Other than realized returns, how do you look to evaluate a manager?

• 8:34Speaker 02

  Well, at the end of the day, it is all about cash on cash. You know, fortunately or unfortunately, adventure at the end of the day can be very far away. So one needs interim measures to evaluate fund opportunities. And if you're, you know, strictly looking at the numbers, we use the same things that everybody else uses, net IRRs, TVPIs, DPIs, benchmark comparisons, et cetera. But of course, those interim measures won't provide the whole picture either. So, you know, we have to evaluate many other things and construct a mosaic of the opportunity. What is the quality of the portfolio at this stage? You know, one good signal is, do other GPs covet this portfolio? Is the portfolio on strategy? Which partners produce these returns?

• 9:19Speaker 02

  Do we think they can repeat? But, Harry, when we're evaluating these opportunities, the view of the entrepreneurs or founders is the most important part of our process, since it's the entrepreneurs and the founders who are the people who produce the VC industry returns.

• 9:37Harry Stebbings?

  Does social proof then play a big role in the decision-making process?

• 9:41Speaker 02

  It depends on who's social proof. So we find that founders and entrepreneurs are leading, opinions are the leading indicators of the relevancy and potency of a VCs brand. We find that many LPs opinion of a VCs brand is actually a lagging indicator. The most powerful form of social proof for us is the opinion of entrepreneurs, and much less so, the opinion of other LPs.

• 10:12Harry Stebbings?

  And say you get a set of brilliant opinions and referrals from founders and entrepreneurs, and you're looking to actually make the investment. What excites you about the funds that you work with today?

• 10:23Speaker 02

  You know, I'll tell you, there's a lot that excite us. What we're really trying to find here is the teams that are well-regarded by founders, and we like VC teams who are just scrappy as hell. The VC teams that we love are very proactive, they're winning high-quality deals.

• 10:44Speaker 02

  They're putting founders first and they work every bit as hard as the founding team to help the company succeed. You know, another, you know, new characteristic or newer characteristic that we're solving for is, you know, these VCs are using data in a very smart and a very systematic way. And they're using data both to find and evaluate new deals, but also to accelerate a company's growth. And, you know, that didn't really happen in the past. You know, certain VCs would, you know, have a somewhat systematic approach to their relationships with entrepreneurs. And they would help in, you know, in material ways, but in more informal, you know, sort of one-to-one, uh, GP to founder ways.

• 11:24Speaker 02

  The use of data now, I think, in the VC process is a really powerful change. And the, the people we like are using data in, in a very systematic and important way. And both to, you know, find deals and win deals, but also to help the companies succeed. So, and then, you know, of course, the, the teams that we like are doing the, the usual blocking and tackling. They're helping the company make connections, to hire great teams, find customers. Another, you know, sort of important thing that we're looking for is, you know, the VCs and teams that we like, in addition to solving for scrappiness, they're a whole lot less concerned about social proof, about what other VCs are doing.

• 12:04Speaker 02

  You know, one of our favorite groups call this, you know, aversion to investing on borrowed conviction. These teams that we like are really, have a point of view. They're connected with founders in important ways and they will go their own way. Uh, and more concerned about what these cutting-edge founder teams are doing and less about, you know, who else is in the deal.

• 12:25Harry Stebbings?

  That very much reminds me of Iden at Felices, actually.

• 12:27Speaker 02

  Oh, yes, very much so. And there are others, there are others. Certainly, you know, Binary Capital is another one I can think of that has their own point of view and, and really, you know, much more attuned to founders than they are necessarily what other co-investors are as a, as a leading indicator of, you know, should they be interested in the deal or not. And, and I will say the other, the other thing we're looking for on the qualitative side is, you know, how are they building their firm? How, what kind of firm do they want to build? You know, what sort of platform do they want to build? And how do they engage with LPs in useful ways? So these are all, you know, bits of the mosaic that we try to put together. And when we see these things come together, uh, we get pretty excited.

• 13:10Harry Stebbings?

  I'm really intrigued. You said about engaging with LPs in useful ways there. What does engagement usefully look like with the LP to GP relationship? Other than the traditional kind of emails and outbound, inbound, sorry, that I'm sure that you get. What does a useful engagement look like?

• 13:27Speaker 02

  Our process is to calibrate as many managers who are in our wheelhouse. There are a number of reasons for that. One is you have to calibrate a lot of managers to know what great looks like. And it's really important for us to, you know, assemble a portfolio of what we think. Groups that have the right characteristics. Of course, we're not always right. But, you know, we do have a point of view and we want to assemble a really good team on the field. And to do that, we have to have the aperture wide open to new opportunities. Harry, as you know, this is a business is once you, you know, think you have a pat hand in terms of your manager list. You know, you're probably, you know, set up to, you know, to take a fall.

• 14:10Speaker 02

  So we have a, the aperture for viewing new groups is wide open. We also have a very concentrated portfolio. And so it's hard to earn a place in our portfolio, but not impossible. So if people want to pitch us, they are more than welcome to do so. We want to talk to them. We want to hear what they're doing. And we want to calibrate them to see if it's a possible fit in our portfolio. So of course, you know, a warm introduction is always good, but we don't require it. We do look at data, though. We do want to have information about a portfolio company information. I'm not talking about operating information. I'm just talking about the basic blocking and tackling of, you know, cost and valuation and how much capital's been invested in.

• 14:55Speaker 02

  And from that information, we look at loss ratios and multiples and which partner has produced returns? And what are the sources of returns from the funds, et cetera? That's how people come to us. Because we have to say no a lot, we like to give something back in return if we can. And so the data that I just mentioned that we collect in our proprietary tool called Weathervane. We will share that data back with the people who. A calling on us so we can give them a perspective of what other people have been doing in exactly the same timeframe that, you know, this particular fund has been investing. We like to give feedback because think about, you know, when a fund, you know,

• 15:36Speaker 02

  goes to the trouble of creating a team and creating an opportunity and a strategy and coming to you with, you know, the sort of, at that point, the culmination of their lives were putting themselves out there for your consideration and probably for your rejection. That's not easy, you know, it's not like being a fighter pilot or something like that. But it's also not, it's not easy and we respect that struggle too. And so we want to give good feedback and we want to be very honest about it. So here are the bits that we like, here are the bits we don't like, here are the bits that we are unsure of. If it's not a fit, we want to tell people pretty early.

• 16:13Harry Stebbings?

  What are the most common, what are the most common reasons you find yourself repeating for, for why you're not investing?

• 16:19Speaker 02

  Most of the time it's undifferentiation. We, we see managers who, you know, have spent some time in the field and they have a credible record, but it's not an exemplary record after, you know, having done it for a while. Uh, for new managers, you know, maybe the track record is short and we will underwrite that. But, you know, we find ourselves with, you know, at least notional coverage of the same opportunity set. These managers may be good and may be interesting, but it's not demonstrably different or better than the managers with whom we're already investing. And sometimes, you know, and sometimes the returns are just awful. Or, or the opportunity is poorly articulated or, you know, it's just not well thought out. We don't want to be rude about it. This is, you know, people's life work.

• 17:03Speaker 02

  And, and frankly, you know, people who are in this business generally, I think, are intellectually a cut above a lot of other asset classes. So nobody's terrible. You know, there's certainly people who are, seem to be better at it than others, yeah.

• 17:15Harry Stebbings?

  So let's take no to another level then, and say you've committed to a fund for Fund One. To what extent are you then committed to investing in follow-on funds for Fund Two and Fund Three in the ecosystem? To what extent does that commitment persist?

• 17:29Speaker 02

  It's certainly true that most institutional investors consider the first commitment at least a two-fund commitment, if not a three-fund commitment. You know, that's because really when Fund Two goes, you know, rolls around, you don't really have enough information to make a change from Fund One. And if you've done really good due diligence and you've not made a mistake, then most people do think that these are at least a two-fund, you know, a set of two-fund commitments. But there's no guarantee. You know, something could change between Fund One and Two, or Fund Two and Three. For us, when we decide to stop backing a VC firm, it's usually based on the loss of relevancy with founders.

• 18:11Speaker 02

  And we ask ourselves every time, how does this particular team find and win deals versus their top competitors? Everybody has been upping their game in the last few years. You know, there are fewer people who are coasting on old track records. And again, you know, it's about the top founders calling the ball. These founders are much better informed than ever before, and the competition to win deals is very stiff. So the table stakes for a VC firm are so much higher than they've ever been. You know, if a VC firm that maybe we've backed before has not been investing a significant amount of their management fee and income and effort back into the firm and into resources to help their companies, then that firm's already behind.

• 18:53Speaker 02

  And then there's some other reasons that we stop backing, and sometimes it's the, you know, loss of a critical team member, or it's just poor execution, which, you know, probably means that we didn't choose wisely in the first place.

• 19:04Harry Stebbings?

  That's the game of venture.

• 19:05Speaker 02

  Yeah, it is.

• 19:06Harry Stebbings?

  But I do want to slightly switch sides of the table and discuss the managers and the startups themselves. So first, the LP community, it's always been pretty covered in mysticism. As you said before, much like Fred Wilson did in unveiling the VC community ten or so years ago. So why do you think VCs struggle to navigate the supposedly mystical LP community?

• 19:29Speaker 02

  Well, I think it's because most new fund managers have had little or no exposure to the process. You know, once you've done it a time or two, it becomes less experienced. There's No place to go to find out how this gets done. It's all pretty much word of mouth. You know, the second thing is, is that, you know, newish managers have a tendency to want to use the same process of raising a fund as they use when they make a company investment. And there are some similarities, but there's some really important differences. And, you know, the time to close cadence, the sort of interaction with the LPs, the documentations. These are three really big, important differences between, you know, raising capital for a company

• 20:12Speaker 02

  or deciding to to commit to capital to a company and getting an LP to decide to commit capital to your fund.

• 20:19Harry Stebbings?

  What is the time to close cadence for fund investing then?

• 20:22Speaker 02

  It's longer, it's much longer for most people and for newish managers. Uh, there are some exceptions to this rule, but, you know, if you were raising capital for, you know, a reasonably well-regarded company, um, it can be, you know, as short as a week or two, right? If there's some known quantities involved and, yeah, there are cases where that could drag out. But if you're raising a fund, especially a first-time fund, and you have no special extenuating circumstances like, you know, three LPs who are gonna, you know, take up the fund, you know, themselves because they've, you know, worked with you for the last five years on some other project. Uh, unless you have extenuating circumstances, there is, you know, the LP process

• 21:04Speaker 02

  requires a period of time to get acquainted with the new VC manager and the opportunity and to calibrate them, you know, inside our network. So, uh, it just takes, it can just take a lot longer for all of that to happen.

• 21:19Harry Stebbings?

  I'm, I'm really glad you said that because one friend and, and fund manager on the show the other day, Chad Byers, Sousa, uh, suggested that even for Fund One, managers should go and pitch institutional LPs, knowing that you're not gonna get it for Fund One, but to kickstart a relationship potentially for Fund Two and to start that kind of time to close really then. Do you agree with this assessment? And, and what advice would you give to those then looking to relationship build with LPs? You know, it's not, I don't know, you probably do hang out at the, the Rose, is it the Rosewood, uh, Sand Hill? But what advice would you give?

• 21:57Speaker 02

  I think, you know, I think his observation is perfect. That's how the good ones do it. That's how you do it right. You do establish long-term relationships. You know, I would just back up to say there, you know, there's one important, another important difference between deciding to invest in a company and deciding to invest in a fund. You know, in a company, you certainly hope that it's a long-term, you know, investment and the company succeeds, but very often they don't. And the economic relationship stops there. You know, these venture capital funds are 10 or 12 or 15-year entities. And so you're involved with these venture managers for a much longer period of time than perhaps, you know, venture managers involved with a portfolio company.

• 22:42Speaker 02

  So these are, you know, important long-term relationships. And I think Chad, you know, demonstrates to me that he is building the groundwork for a sustainable firm. And to have these conversations with LPs in preparation for subsequent funds is exactly the way it needs to go. And I think he demonstrated that, you know, that preparatory work was well rewarded when he raised Fund 2. You know, one of the, one of the things you have to, you know, that fund managers need to remember is that, you know, LPs respond to, you know, different kinds of stimuli at different times. You know, another thing I think makes it difficult on fund managers is many LPs are not comfortable giving feedback to GPs.

• 23:26Speaker 02

  And so fund managers may not have a clue how they're being perceived or why they're not a fit with, you know, institutional managers' portfolio. So I think all of these things sort of contribute to the opacity of the process and, you know, sort of leave, you know, VCs in the dark, the newer ones particularly.

• 23:44Harry Stebbings?

  But I want to dive into a quick fire round with you now. So I say a short statement, 60 seconds per answer. You ready?

• 23:50Speaker 02

  I'm ready, but holding me to sixty seconds, what?

• 23:53Harry Stebbings?

  I'm gonna hold you to see.

• 23:54Speaker 02

  No one's been able to do this in the past, alright.

• 23:56Harry Stebbings?

  Well, uh, okay, well, wish me luck.

• 23:59Speaker 02

  Yeah.

• 24:00Harry Stebbings?

  Well, let's do, let's start with, um, which fund are you not an investor in, uh, that you think is exciting now and why?

• 24:07Speaker 02

  So I have to say, I really like what social capital is doing. It's a very big fund already, so I'm not sure how it's going to play out, but, you know, their partners are super smart and they're very forward-thinking. You know, there are lots of unknowns here and their size may mitigate against them. I think they'll at minimum see and continue to see more than their fair share of iconoclastic entrepreneurs. And I think they'll, they'll capitalize on that very well.

• 24:31Harry Stebbings?

  Absolutely agree. My moon is unbelievable.

• 24:34Speaker 02

  Oh, yeah.

• 24:35Harry Stebbings?

  And then let's do your favorite book and why?

• 24:37Speaker 02

  Okay, um, so my favorite book is, uh, actually any one of the twenty books written by Patrick O'Brien in his Aubrey Maturin series. Do you know this?

• 24:48Harry Stebbings?

  Of, of course, yes, I've read it back to front. Um, no, I think, I, I, I, could I get away with that one? Probably not. Uh, no, no, I haven't actually, sorry.

• 24:58Speaker 02

  Oh, oh, okay. Well, you know, I only mention it because, you know, you're a Brit and these are historical novels about the British Navy. You know, what do I love about these books other than everything? Well, you know, the characters and the relationships and the peer yourself, these are, you know, all very richly drawn. But here's a parallel for this interview in this book. It turns out that, you know, a British warship is a lot in common with startups in the VC ecosystem. And there are a couple of reasons, like the senior team had to raise capital to revision the ship. They had to recruit and lead teams, they had a, you know, cohesive culture, they had to build that aboard the ship. You know, the Navy would provide these captains with their initial strategies and objectives. But of course, you know, all of these original plans didn't survive contact with the enemy or with reality.

• 25:42Speaker 02

  So there were all kinds of pivots and discarded plans and improvised new ones and things like that. And there was also a lot of scientific exploration and engineering that went on, you know, during these voyages. And there was statesmanship and spycraft and, and, and, oh, by the way, if these guys ever captured an enemy ship, each crew member got carried interest on the value of the ship when they got back.

• 26:03Harry Stebbings?

  Well, having stuck to the limit there very well, uh, what do you, what do you know now that you wish you'd known when you started?

• 26:10Speaker 02

  I wish I had known about the importance of the entrepreneur and the founder's opinion of VCs and overweighted that versus the importance of LPs perception of a VC brand. But back in the day, I probably overweighted LPs perception of brands and underweighted founder's perceptions. Now, it's completely flipped for us.

• 26:39Harry Stebbings?

  And then in terms of your reading material, blogs and newsletter wise, what are your favorites?

• 26:45Speaker 02

  Besides yours, I guess. You know, and really, Harry, I have to say, you've done such a great job with the 20 Minute VC. I just look at what you've done and I'm like, that's really kind of amazing. So, you know, super good on you for that.

• 26:57Harry Stebbings?

  It's very good. It's easy when you love it.

• 27:00Speaker 02

  Yes, isn't that true for everything? And it's obvious that you do. So, that's, I think that's really wonderful. But besides yours, I would say that, you know, I read and listened to many of them. But on the VC side, I would say, you know, I love the content produced by A16Z. If you haven't read the content produced by Founder Collective, I highly recommend it. And of course, First Round does a great job. And I'd say on the professional media side, you know, it's the usual, but Recode, it's Panda, it's Dan Primack, it's Connie, it's TechCrunch. You know, all of these people, I think, have really good insights into the venture community. And I think they do a really good job of giving a rounder picture of what's going on in this part of the world.

• 27:43Harry Stebbings?

  And then the final question today, I'd love to hear about your most recent public investment and why you said yes.

• 27:48Speaker 02

  Let me just, you know, pick one that we did this year and that's been on my mind for a very specific reason recently. And that's Felisa's Ventures, and you mentioned them earlier. So, we've been with Felisa's, you know, since their beginning. I cannot tell you, Harry, how proud we are of how this firm has grown and developed. You know, returns, of course, are all you want and then some. You know, the culture of the firm is so healthy and so vibrant. You know, you've spoken to them, they're so proud of their immigrant roots. And I think that, you know, that's one reason why they resonate with such a wide variety of founders. I told you before, we saw for the super scrappy teams, you know, Felice's team is very, very scrappy and they work as very bit as hard as their founders.

• 28:29Speaker 02

  So, you know, we love all the managers we back, but I have Felice's on my mind in particular because, you know, they were investor in Dollar Shave Club. And with that recent sale, now each one of the Felice's partners has at least one billion dollar exit under his or her belt. That's quite an accomplishment for such a young firm. I'm, I'm, I'm calling them out just because of, you know, because of that, that reason. There are plenty of older firms out there who, you know, can't make that claim for their partners.

• 28:57Harry Stebbings?

  Well, Judith, the pleasure's been all mine to have you on the show. I'm so grateful to you for giving up your time today. And it's been amazing to hear the nautical origins of Weather Gauge. So thank you so much for sharing it with us today.

• 29:09Speaker 02

  Thank you, Harry. Thank you for your patience with that long discursive explanation. And I've enjoyed chatting with you today. So let's do it again sometime.

• 29:24Harry Stebbings?

  Absolutely, we will. And what a fantastic episode that was with Judith and genuinely such an honour to have her on the show and so grateful for all Judith has done for me. Likewise, Beza, this would not have happened without your fantastic introduction and I'm so grateful for all you've done for me too. And if you haven't already checked out Beza's Open LP, it really is awesome. So you can find that on openlp.com. And if you love the episode today and do not want to leave the world of 20 VC, you can add me on Snapchat at H Stebbings. Or you can head over to the site, the20minutvc.com where you can sign up for the newsletter. So you never have to miss an episode or an update from us. And do not forget what I said earlier, funds would be nothing without the operational support behind them. And in this case, there's no one better than Cooley, the global law firm built around startups and venture capital funds.

• 30:08Harry Stebbings?

  Since forming the first venture fund in Silicon Valley, Cooley formed more venture capital funds than any other law firm in the world. With over 50 years working with top VCs, they help VCs form and manage funds, make investments and handle the myriad of opportunities and issues that arise through a fund's life cycle. So to learn more about the number one most active law firm representing VC-backed companies going In public, simply head over to cooley.com or check them out on cooleygo.com. But one thing we did not mention in today's episode was the importance of sleep. Obviously, it is crucial, and that is where Eve come in. Eve is the UK's number one direct consumer mattress company. Because they don't sell through high street stores, they have the ability to cut out seventy percent

• 30:50Harry Stebbings?

  of traditional costs and pass those savings on to you and I, the consumer. And these mattresses are developed over four years with thousands upon thousands of prototypes. And Eve are so confident of their product that they give customers one hundred nights to try it at home before committing. And if that wasn't enough, for those who don't love it, they even offer a free return pickup with full refund, so there really is no risk. Simply go to eve mattress.co.uk, enter the promo code twenty vc, and they'll give you a fantastic fifty pounds off and it'll be with you the next day. And I'm so excited to say that next two episodes will be featuring romance in the world of venture capital and startups as we welcome Dave Moran of Slow Ventures and Britt Moran of Britain Co. to the show. As always, I so appreciate all your support and I look very forward to bringing you those two episodes.