20VC: Nuzzel's Jonathan Abrams on Why The Top VCs Do Not Have A PlayBook For Startup Success, Why Most Boards Are Not Successful & Why He Is Bored Of Hearing "I Fell Into VC"

Jonathan Abrams is the Founder and CEO @ Nuzzel, the startup that offers personalised news discovery and curated newsletters for busy professionals. They have backing from some of the investing greats including Marc Andreesen, Naval Ravikant, Homebrew, SoftTech and Lowercase just to name a few. Prior to Nuzzel, Jonathan was the Founder of early social media machine, Friendster attaining funding from Benchmark, Kleiner and Reid Hoffman. Jonathan is also a prolific angel investor counting AngelList, Docker, Front, Instacart, and Slideshare amongst his portfolio. In Today’s Episode You Will Learn: 1.) How Jonathan made his way into the world of startups and came to found Nuzzel? 2.) Why does Jonathan dislike it when he hears that a VC "fell into the industry"? Why does that not resonate with entrepreneurs? How can it be better phrased to align with operationally minded people? 3.) Why is Jonathan tired of hearing the word conviction from investors? Why does it not make sense to say you invest with conviction? How would Jonathan like to see the use of data to prove conviction-driven (high ownership) is optimal for fund returns? 4.) Does Jonathan believe there are too many seed funds in market today? Why does he believe we have seen a reduction in the numder of $'s going into seed companies? Does Jonathan believe the future is thematic for seed funds? 5.) Why does Jonathan believe the majority of boards "are just not very successful"? What does Jonathan believe makes a great board member? Likewise, what can entrepreneurs do to most effectively manage their board? Why do we need more operational people on boards? Items Mentioned In Today’s Show: Jonathan’s Fave Book: Beggars in Spain by Nanacy Kress Jonathan’s Fave Blog: Strictly VC As always you can follow Harry, The Twenty Minute VC and Jonathan on Twitter here! Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC. Pendo delivers the only complete platform that helps companies create great products. The Pendo Product Experience Platform enables product teams to understand product usage, collect user feedback, measure NPS, assist users, and promote new features in-app – all without requiring any engineering resources. This unique combination of capabilities helps companies improve customer satisfaction, reduce churn, and increase revenue. Pendo is the proven choice of Salesforce, Cisco, Optimizely Citrix, BMC and many more leading companies. Start a free trial at http://go.pendo.io/harry Treehouse is an online school where you can learn how to build websites and apps. Their course library has thousands of hours of content, where you can learn all sorts of topics, including Javascript, iOS, Android and more. With high-quality video instruction from real industry experts teaching you all you need to know, and quizzes and code challenges keep you engaged and on track. Learn on your own schedule and go from beginner to pro. Go to teamtreehouse.com to start your free trial.

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

• 0:00Harry Stebbings?

  You are listening to the 20 Minute VC in a very special episode today as we welcome back a previous guest and long-term friend of the show. Therefore, I'm thrilled to be joined in the hot seat today by Jonathan Abrams, founder and CEO at Nuzzel, the startup that offers personalised news discovery and curated newsletters for busy professionals. I do have to put our hands up here and say it is one of our favourites. And they have backing from some of the investing greats of the day, including Marc Andreessen, Naval Ravikant, Homebrew, Softtech and Lowercase, just to name a few. Prior to Nuzzel, Jonathan was the founder of early social media machine Friendster, attaining funding from Benchmark, Kleiner and Reid Hoffman. Jonathan's also a prolific angel investor, counting Angel List, Docker, Front, Instacart and SlideShare amongst his incredible portfolio. I do also want to say a big thank you to Matt Mazzio for the intro to Jonathan today.

• 0:44Harry Stebbings?

  It was a long time ago but so appreciated and the start of a great friendship, so a huge thanks for that, Matt. But before we head into today's episode, Pendo helps companies create products that customers love. It was founded when alumni from Rally, Google, Cisco and Red Hat combined their heads and their hearts to build something they wanted but never had as product managers, a complete platform for product teams. With Pendo, you can understand product usage and rapidly make data-driven decisions, survey users in-app for NPS and feedback, deliver contextual help to improve UX and user onboarding, promote new features in product to drive adoption without requiring any engineering resources. Pendo is the proven choice of innovative product leaders at Salesforce, Optimizely, Citrix and many more leading companies.

• 1:27Harry Stebbings?

  Learn more today at go.pendo.io/harry. That's go.pendo.io/harry. But what if you're starting out in the industry and want to learn to code? Like I was four years ago, I went to Treehouse, the online school where you can learn how to build websites and apps. Their course library has thousands of hours of content where you can learn all sorts of topics, including JavaScript, iOS, Android and more, with high-quality video instructions from real industry experts teaching you all you need to know and quizzes and co-challenges keeping you engaged and on track. Learn on your own schedule and go from beginner to pro. So simply head over to teamtreehouse.com to start your free trial. But enough of my nerdy British accent, so I'm now thrilled to hand over to Jonathan Abrams, founder and CEO at Nuzzel.

• 2:16Speaker 01

  You have now arrived at your destination.

• 2:19Harry Stebbings?

  Jonathan, it's such a pleasure to have you on the show for the second time. What can I say, I enjoyed it so much the first time that I had to have you back. So, thank you so much for joining me today.

• 2:28Speaker 02

  Great to be back, happy to do it. And hopefully, the next time we talk, it'll be in person so we can get those mojitos that we've been talking about.

• 2:35Harry Stebbings?

  Oh, I would love that. And now I'm 21, I can finally drink in the US after four years of waiting. But moving on from mojitos, for those who have been living under a rock and missed your first show, talk to me, how did you make your way into the world of tech and come to be founder of my personal favorite and I think most used app being Nuzzel?

• 2:52Speaker 02

  Well, first of all, thank you for the kind words. And it's always fun to hear your guests on your show talking about how they use Nuzzel. As you know, I listen to, yes, I listen to most of your episodes, a big fan. And it's always fun to hear, in addition to the interesting conversations about VC, to also hear people talking about loving Nuzzel, that's always a bonus. In my case, you know, I think everything I've done and started, even Founder's Den, has been the result of years of thinking about something and usually a personal problem I'm trying to solve. So, in the case of Nuzzel, I was, just like a lot of people, having trouble keeping up. I was overwhelmed and overloaded with content and with social sharing. And I really didn't have time to keep up and click on every single link that my friends were sharing on Facebook and Twitter.

• 3:37Speaker 02

  So, I needed something to manage and tame that chaos for me and tell me this is the most important content you need to know about and pay attention to. So, that's really how Nuzzel got started.

• 3:45Harry Stebbings?

  So, that's your route into Nuzzel. And we've discussed the show there and you very kindly said you listen. And other guests on the show have said they fell into VC. And you said in a conversation before that you're surprised by the amount of VCs that say they fell into VC. So, why is this and why are you surprised?

• 4:00Speaker 02

  I am surprised about it and especially surprised that they're actually saying that. And I actually, a while ago, months ago, I think I actually tweeted and I said, you know, my advice as a founder is that's probably not the way you want to position it. And since then, people, you know, still say it. And it does surprise me because first of all, when you hear venture capital, you know, famous VCs sometimes in the media, talking about the lack of Diversity in their firms and being challenged about it and and saying that they can't relax their standards. And fair enough, but when then you hear people saying that they fell into it. It sort of makes you think there's a bit of a contradiction between people who just somehow miraculously fall into the venture world. And then the lack of diversity. And the other thing is that it's just a weird way, I think, of positioning it.

• 4:44Speaker 02

  Even if early in your career, you weren't planning to become a venture capital investor. I think there are ways that it could be portrayed, the path, that probably going to sound more appealing to entrepreneurs listening. Uh, and as an entrepreneur, it just doesn't resonate with me to say you fell into it because entrepreneurship, you rarely fell into it. I mean, usually it's a lot of risks, a lot of hard work, a lot of proactive effort in, you know, creating something out of nothing. So I just think it's a, it's a weird thing to say, even if you did get that lucky break, which it seems like some of these people have. And really it does sound like the benefit of privilege when a family member or a former college roommate or somebody gives you this lucky break. That is an entree into that world.

• 5:25Speaker 02

  It's a weird way of saying that you fell into it because it just doesn't sound like something I think is going to excite entrepreneurs that might be listening.

• 5:32Harry Stebbings?

  Can I ask, what would resonate with you? If if I told you that I had strategically planned my path into VC from the age of 13. And the show was a strategic maneuver to get into VC and to become the central node of an ecosystem. Would that, would that resonate with you?

• 5:46Speaker 02

  Well, it is impressive. Of course, I know, Harry, that that is, that's the truth. I know that's your story. For for anybody else, I don't think they need to have been planning their career in venture capital since they were 10 like you. But but they still don't need to say they fell into it. They can say, look, early in my career, I was doing this. Then later I did, uh, learn about venture capital and I thought it would be a really cool way for me to get to work with entrepreneurs. And I got this opportunity and I was excited to take it and it's been really great and I love working with entrepreneurs. And you can say all that without making it sound.

• 6:18Harry Stebbings?

  So flippant.

• 6:19Speaker 02

  Yeah, yeah, exactly. I mean, even, you know, I'm not saying that you have to have planned your career from early childhood. But I think there's, there's ways of expressing your gratitude that you had a lucky break, that you got into that industry without making it sound like it was so accidental.

• 6:32Harry Stebbings?

  I do agree. And speaking of the backgrounds, there's often a lot of debates surrounding the background being operator or founder. So I'm intrigued, how do you view whether operators or founders make good investors?

• 6:43Speaker 02

  Well, you know, that's, that's a question that obviously I have opinions about. Of course, I'm an entrepreneur. For me, an investor that has an entrepreneurial background, that has been in my shoes, that's a big advantage to me because I think they're, they're going to be able to understand my side of things better. And contrary to somebody who's been recently in the news, I actually think that empathy is a good thing and an advantage. And I think you usually want the people you're working with to have empathy. And I think if you have done it before, if you've been a founder and CEO of a venture backed company, that's probably going to be an advantage. The funny thing is, I'm amazed that people are still debating this so much. You know, when did Josh Koppelman start First Round Capital?

• 7:22Harry Stebbings?

  Two thousand and eight?

• 7:22Speaker 02

  Two thousand and eight. So that's nine years ago. You know, when did Paul Graham start Y Combinator? When did Mark Andreessen and Ben Horowitz start Andreessen Horowitz? I mean, these, these are not recent things. So the funny thing is, I hear sometimes people on podcasts, still recently, sort of reacting to this, the idea that, that some people are saying only founders can be good VCs, or that anybody with operational experience is going to make a great investor. And I don't think anybody's saying that. I'm not saying that only founders would make good investors. Nobody, I don't think anybody's saying that. There's lots of fantastic venture capital investors who have not been founders. And I don't think anybody's saying that anybody who makes a transition from being an entrepreneur or an operator into investment is going to be successful.

• 8:05Speaker 02

  So I don't think anybody is saying those things. But people are sort of reacting to those things and, and, you know, pushing back. I think sometimes people who are not former founders and they're sort of maybe don't want to be, to hear the suggestion that maybe that's an advantage. If you look at fund performance, which I have, everybody talks about three X and five X and 10 X, and there's all this great stuff on podcasts and in the press. But the reality is, most funds have pretty mediocre performance between one and two TVPI. So most investors are not doing that great. So whether you're a former investment banker, a former lawyer, a former corp dev executive, or a former founder, most VCs are not necessarily killing it. And that's not a shock. But I would say that if you have been a founder and CEO of a venture-backed company, then you're going to have a certain perspective that others are not.

• 8:50Speaker 02

  And people who haven't been in my shoes as a founder probably don't even know what they don't know.

• 8:55Harry Stebbings?

  Speaking of killing it, I'm sure one person that will agree has killed it over the past few years is Peter Fenton at Benchmark, one that you made the intro to. So huge thank you to that because without that, the interview we had with him wouldn't have happened. But he said in our episode, never turn down a company based on valuation because it's a mental trap. So tell me, what are your views towards valuation sensitivity?

• 9:16Speaker 02

  Yeah, Peter's great. I actually met Peter when he was actually still at Excel before Benchmark had even poached him a while back. And big fan, he's also a nuzzle user. And I tend to agree with Peter. It's an interesting question. I've heard you talk about this with a lot of guests on your show. And the funny thing is, you know, I'm an entrepreneur and an engineer. So I a lot of times try to break things down and understand it analytically. And when it comes to this idea of whether you should be price sensitive or not, there's a lot of different opinions and none of them really seem to be backed up by data. So it'd be interesting if a venture capitalist came on the show and said, look, we analyzed our data and over the last three funds with this many different companies,

• 9:55Speaker 02

  we took the bottom half in terms of our entry price and the TVPI on average was this versus this for the more expensive deals. And therefore that proves that we should or should not be price sensitive. But I don't really hear people coming on the show and really using data. It usually just seems to be sort of personal religion almost about these things. In my case, the angel investments that I've made that were a little high in price have been ones that I was glad that I've made. And when I see ones that are sort of below market or really on the cheaper side, usually they're not the deals I want to do.

• 10:28Harry Stebbings?

  No, I definitely agree with you in terms of that signaling. Do you think though, I have to ask, that one can afford to be valuation sensitive in today's frothy market? We often see anywhere between 10 and 30 pre on YC companies. Do you think you can afford to be price sensitive today?

• 10:42Speaker 02

  Well, I guess it depends on if you're talking about can you afford in terms of missing out on the companies you really want to invest in? Or if you think that it's going to decrease your returns? And I think The idea that if you invested in a portfolio of companies and your average price is eight pre versus sixteen pre that you're going to have half the return, I don't think that's really mathematically correct because it's not going to be necessarily the same companies. So I really think at the seed or angel or even A, I mean, it is all about the outliers. It is all about trying to find companies where you're going to get ten or twenty or fifty or more in return, and it really matters about just getting into those companies. So I think that it's about picking the right companies, and if you're going to say, okay,

• 11:25Speaker 02

  this company is an exciting company, I believe in these entrepreneurs, I think they're shooting for something crazy, this could end up being a huge win in my portfolio, but I would invest if it was a ten million dollar valuation but not twenty, you know, I'm not sure if that really works. And like I said, I'd love to see the math. I'd love to see people proving whether this is right or wrong.

• 11:43Harry Stebbings?

  But I do want to ask then, because the frothy market is often due to the increased number of ancients, specifically at seed and micro VC. So I have to ask, are there too many seed or micro VCs in your opinion today?

• 11:54Speaker 02

  Well, first of all, I think seed funding is actually going down, not up. I think that's been the data that I've seen from a bunch of folks. In terms of valuations, I think those might have already hit their peak in two thousand and maybe fifteen. So the idea that the valuations have just, you know, as they went up throughout two thousand, maybe ten to two thousand and fifteen, I don't think they've continued to go up in sixteen and seventeen. So I don't think it's quite the crisis of seed overfunding and overvaluation. I think the biggest problem with valuation was the later-stage valuations of so-called unicorns. That was, I think, a bigger problem, and it's that's still, to some extent, sitting around in some companies, some overvalued companies having raised hundreds of millions of dollars. That's a whole other thing than, you know, the world I play in

• 12:37Speaker 02

  as an angel investor. In terms of the seed and micro VC world, there is a lot of noise about there's so many new entrants into micro VC, there's so many new funds and all this kind of stuff. I actually kind of think it's a good thing, because I think a lot of these new funds have been fantastic and a lot of great stuff is going on. I think it's sort of the next generation of the venture world. But the reality for most entrepreneurs is there's not three hundred micro VC funds that they're actually pitching. If you narrow the list down into geographies... And focus on specific industries and the ones that are really active and all this kind of stuff. There's not like really 300 that somebody's pitching. There are ones that I think are going to go away because I think there are some folks in the in the so. I don't even like the term micro VC because it's really just early stage venture capital back to the roots.

• 13:18Speaker 02

  There's some that are going to be real permanent institutions and there's some where it's a couple of people who already, you know, made a bunch of easy money and I don't know how serious they're going to be about it. Or there's not, you know, a real cohesive team or they're also trying to do five other things while they're also doing a fund. So some of these are going to sort of fade away, which is totally okay. But I also think that the amount of of capital going into the seed or micro VC is still pretty small compared to some of the the money that's been flowing into really huge venture capital firms where it's still much harder to get a good return.

• 13:50Harry Stebbings?

  You spoke there about the huge valuations. Kent Goldman stated on the show before that you should use valuation as a litmus test to determine your level of conviction. Focusing on the word conviction there because you've said to me before that you're tired of hearing about conviction. So why are you tired of hearing about conviction when it seems to be the foundation of all decision making?

• 14:08Speaker 02

  Well, I'm tired of hearing the word conviction and I don't know when exactly this became this sort of word de jour. But I don't know, five years ago, eight years ago, I don't remember everybody constantly talking about conviction. And now it seems like when I'm listening to VCs pitch their funds to LP events or going on podcasts. Everybody's talking about they like to invest with conviction and conviction keeps coming up in terms of their follow on strategy and their portfolio construction and all these kinds of things. And if you're not investing in conviction, what are you doing?

• 14:38Harry Stebbings?

  Spray and pray.

• 14:39Speaker 02

  Well, spray and pray is also like a pejorative. I mean, the reality is there are people who've actually done the math. I've actually seen, you know, a bunch of people who've done the math and proven that a portfolio that has certain size statistically can be correlated with with decent returns. So I think spray and pay can be a bit sometimes a pejorative by folks who want to say, okay, we lead our deals because they're looking to get a certain minimum ownership or whatever they're looking for. But I think most investors hopefully are investing with conviction. Otherwise, I don't know what you're doing because many VCs look at 200 to 1,000 opportunities a year and invest, you know, in one to 10 a year. So of course you're hoping that people are investing in conviction. I just find it strange that people are using the word so much because it's one of those things when people are using the word.

• 15:23Speaker 02

  It almost makes me think that why do they feel the need to say that?

• 15:27Harry Stebbings?

  So you would not say, I'm genuinely intrigued from a personal perspective, would you not say it or would you just use an alternative means of saying it?

• 15:34Speaker 02

  Well, I think it's just one of those terms right now that's been getting kind of trite and cliche. I've been hearing people use it too much and it's just become a really trendy word. And I just kind of think it's interesting because when I hear everybody talking about how they're investing in conviction, it makes me wonder why do they feel the need to say that is that they're really the opposite going on is that the people internally really are having some insecurity about the lack of conviction and therefore they feel necessary to talk about conviction or is everybody feel that somehow conviction is a differentiator? I guess I'm just wondering why is everybody using this word so much lately and it is getting to the point where where I hear it, I just start sort of chuckling inside.

• 16:08Harry Stebbings?

  But we discussed Peter Fanton earlier there, undoubtedly one of the most successful of our generation. So I have to ask, and this is a really intriguing one for me, do you agree that top VCs have this almost repeatable playbook or process for success that they can apply to new startups within their portfolio?

• 16:23Speaker 02

  That's a great question and actually I don't. I kind of think it's the opposite and I've actually heard people also say that they don't think you can learn much from the failures and I don't think that's true either. I think there's more in common with the way that startups can fail. The cases where a company goes through a whole series of CEOs in a row, which we've seen over and over again, these kind of sort of self-imposed mismanagement and governance challenges, these things do happen again and again and again. But when startups become outliers and have huge success, it's often in a very unique way. And I think that it's very difficult to take that and apply that to a later company and try to copycat that success. I just don't think that's really the way it works.

• 17:06Speaker 02

  And in fact, I think trying to take what worked for one successful company and then apply it to a later startup is in fact, one of those patterns of failure that can be imposed. And I've just seen that happen. It's happened to me. So I actually think that's sort of a myth that there's some sort of playbook for startup success that the top VCs have that they can do again and again. And you know, that was kind of the thinking that I had in 2003, which didn't work out so great for me thinking that. So that's one of the things that I think is not really the case.

• 17:34Harry Stebbings?

  How much role do you think that just the backing? From the brand of a Sequoia or a Benchmark or a Lightspeed gives in terms of social validity. I mean, for enterprise companies, having Sequoia behind you can mean a huge amount of recognition from enterprise customers, does it not?

• 17:48Speaker 02

  Well, it's a great question and I like to talk about the fantastic investors backing Nuzzel. I mean, we have Andreessen Horowitz and CRV and Lowercase and Softtech and Homebrew and they're fantastic, fantastic investors and of course, we brag about it. But the reality is, almost everybody can brag about their investors because there's a lot of top VCs. And so in terms of the entrepreneur thinking, oh, I'm a Sequoia company, therefore this is going to give me some huge advantage. Well, you may have five other competitors and that one's backed by Greylock and that one's a YC company and that one is backed by, you know, Softtech and First Round Capital. And then there's new, you know, new entrants, there's Founders Fund and social capital. And so the idea that, that being a Sequoia company is going to be this huge advantage

• 18:29Speaker 02

  in terms of the branding, there's a lot of great investors these days that have great reputations. So chances are, if you have a bunch of competitors, they probably have great names too. And all, in all, in all, I think all of that just matters less than we, we like to pretend it does. My experience has been that ultimately, if a company is, you know, well managed and executing well and the technology works and the product works and they're doing the right things and all that kind of stuff, I mean, that's what really matters.

• 18:53Harry Stebbings?

  We, we mentioned about the playbook to success there. One thing that I think I've really seen, just pattern matching in, in the most successful VCs I've interviewed, is how they think about board seats and also how they've personally developed as a board member over their career. Having, having, you know, managed many boards before from the operations perspective, how do you analyze the best board members? I'm intrigued.

• 19:13Speaker 02

  Oh, that's a tough one because, you know, this is an unpopular opinion, but I think most boards are just not very successful. And you look at some of the things that you read in the press about very famous companies sometimes and some of these companies have some of the most famous venture capitalists behind them. And then you see lawsuits, you see them going through multiple CEOs and quick succession. It's, it's really tough. I think a lot of boards are just not very successful. I think a lot of people are on too many boards. So even if you are a fantastic board member, I don't know how you can be a fantastic board member at, at 10 companies or 15 companies at once. Think that requires sort of a superhuman attribute. And I think a lot of boards have the wrong composition.

• 19:53Speaker 02

  Sometimes I think they have too many investors and some boards are sort of staffed with the sort of like famous celebrity types people like former politicians and stuff like that. And I think more boards should probably have more nerdy choices, like more CFOs, more CIOs, CTOs, CMOs. I think there should be just more boring operational people on on some of these boards than this, you know, quite as many celebrities and investors. But ultimately, it's pretty tough. I think managing a board is something that that most entrepreneurs probably don't quite understand how to do, probably not even in their second company. Because they're not on as, you know, they don't have the same experience. An investor, if you're on 10 boards after even just a couple of years, you're seeing a lot of what's working, what's not working.

• 20:38Speaker 02

  And even if you're a serial entrepreneur and you've, you know, you're on your second company, you you just have not seen quite as much about that. So I think it's a tough one. I think most boards are just actually not as successful as they should be.

• 20:49Harry Stebbings?

  I might decline to comment there just for sake of me continuing the show and getting future VCs on. But I do want to finish today by discussing the future. And Elak Gil has said before on the show that many VCs are searching for the next big thing and are investing in frontier tech that they maybe don't understand instead of software. So I'm intrigued to hear your thoughts on this. And do you think that's a fair summary? And do you think that it it could cause almost a mirroring of the green and nanotech days of 2001?

• 21:16Speaker 02

  Yeah, I think a lot, first of all, is a very smart guy and a very great blogger. He's not, he, you know, runs a company, so he doesn't have time to pump out a lot of stuff. But what he does write is very high quality. And I think that the parallels he's making between nanotech and green tech are accurate. I think that there may be a lot of pain that happens from people investing in areas they're not familiar with. A lot also points out that some of these other areas just don't have the same economics of software. Another interesting blog is from NextView, which I think is in Boston. And I actually don't even know those guys, they're not an investor in Nuzzel. But I found that they've written some really interesting stuff. And they just wrote about their new fund and said that contrary to some people, they don't think the internet and software and all this kind of stuff.

• 21:57Speaker 02

  is over. They don't think it's over at all. And I think they're right. I think cloud and social and mobile, that stuff is not over. There's going to be more great companies. There's going to be more innovation. So the idea that it's all over and you need to sort of jump into some biotech or some other frontier science thing, I don't think that's actually true. And I think if you're going to jump into those areas, you really need to know what you're doing. I'm an LP in Data Collective, which was started by Zach Bog, who co-founded Founders Day with me. They're investing in all sorts of crazy stuff and doing a fantastic job and they're they're doing great and they're probably going to continue to do great on that. But I think if every so enterprise software VC all of a sudden tries to start doing autonomous vehicles and drones and VR and biotech and genomics and whatever. You know, I'm not sure if that's really going to go well for everybody.

• 22:40Harry Stebbings?

  And I do have to give a special shout out here to Matt because he's one of my true favorites. But yeah, I love all they're doing at Data Collective.

• 22:46Speaker 02

  Yeah, you should have Matt back again, probably. He's got a lot to say.

• 22:49Harry Stebbings?

  He's got a lot to say and he's awake for many hours of the day. So I mean, I'm sure we can fit it into the schedule when he's awake for 20 hours of the day. Um, but I'd love to finish today with a quick fire round. Uh, so I say a short statement. As you know, immediate thoughts. How does that sound?

• 23:03Speaker 02

  Great.

• 23:03Harry Stebbings?

  So your favorite book and why? Has it changed?

• 23:06Speaker 02

  Well, I'm going to go with something I think hopefully that I I haven't said before on your show and then hopefully is not one of those books that that you've heard many times before. I'm going to try to be a little different. I'm going to say Beggars in Spain by Nancy Cress.

• 23:18Harry Stebbings?

  I've never had that before. And why is that your favorite?

• 23:20Speaker 02

  So this is one of my favorite books. This is an award winning science fiction book and it's a great book and it also, I think, is is very timely. It really, at the root of it, is really talking about sort of income disparity. And I think it's actually what that book talks about is still very relevant today.

• 23:37Harry Stebbings?

  And then what do you believe that most around you disbelieve?

• 23:39Speaker 02

  Well, we've already probably talked about a bunch of stuff about the repeatable playbook of success. You know, I think one of the things I I think is overhyped now is AI and or really or maybe talking about AI. Because I'm sure a lot of the, you know, I've invested as an angel in over 50 startups. I'm sure plenty of them are using AI. But when I hear everybody talking about it, you know, in their startup pitch and VC saying they're looking for it, that's when I start to get a little nervous when everybody's talking about the same stuff. So I, you know, I think it may be a bit overhyped.

• 24:06Harry Stebbings?

  But talk to me, favorite blog or newsletter? What are the must reads?

• 24:10Speaker 02

  I'm going to give a shout out to Strictly VC by Connie Lozoy. That's definitely one of my must reads each day and I really enjoy that one. I've known Connie for a long time. She's been sort of a veteran covering the venture industry.

• 24:22Harry Stebbings?

  Is thematic specialization the future of VC and why?

• 24:25Speaker 02

  Wow, that's an interesting one. I don't know if I can give a quick answer to that. I think I'd have to say yes and no. Everybody's trying to talk about their differentiation and sometimes maybe manufactured differentiation. And I think that you can go in two directions either way. I mean, there are softer VCs who are investing in mattress companies and coffee and things like that. And I've learned my lesson to try to stick to things I know about. On the other hand, there are VCs now who only want to invest in these very niche frontier tech areas. And I think that may be incorrect as well. I think you have to be a little bit more opportunistic and see what entrepreneurs are doing. So I think you have to sort of do the happy medium in between.

• 25:03Harry Stebbings?

  No, I completely agree. And I'm going to be contrarian here. And I think thematic specialization leads to a brilliant LP product, but not always the best returns personally.

• 25:10Speaker 02

  You know, I think sometimes these things are more for pitching it to LPs than they are for reality. And I've actually met, you know, as you know, I'm an LP in a few funds and I've recently met with some other really institutional LPs, just chatting about things going on in the venture world. And some of them have complained to me that a lot of managers, GPs are coming to them and pitching a certain strategy for their fund that is not at all what they've actually been doing, or not what they end up doing. And they're pitching that they're going to have a certain specific type of strategy and how they're going to do their portfolio construction, or their thematic focus, or whatever. And then the reality of what they do after that, or have done in the past, doesn't match it.

• 25:47Harry Stebbings?

  Dramatically different. But then let's finish now on the next five years for you and for Nuzzel. I read it every day. How's the product going to change? What's the roadmap ahead?

• 25:55Speaker 02

  Wow, so that's a great question. So as you know, Nuzzel, our vision has been all about connecting people with the content they really need to know about. And I think that's not what people are getting from publishers, news, other news apps. I don't think that's what people are getting from the big social networks. And everybody is trying to do stuff in this area now. But what people are getting on Facebook, you know, it's a lot of fake news. It's a lot of clickbait news. I think that nobody still has solved this problem. Think it's still a huge problem. So we are continuing to innovate in this area. We have created an email newsletter platform where people can easily create email newsletters. We've built a Facebook Messenger bot, so the billion plus people are active on Facebook Messenger now can get Nuzzel newsletters actually sent to them right in Facebook Messenger.

• 26:36Speaker 02

  So they don't necessarily need to install a separate news app. We're now looking at ways that we can take the data and technology behind Nuzzel and also apply it in other ways for in sort of intelligence briefings within needing to get, you know, information on topics. I mean, we're still hearing from people that people are overloaded. And for example, you were asking about what newsletters I get. When we're hearing from a lot of people, especially sort of business executive types, a lot of the, you know, and you know, Nuzzel is used by a lot of CEOs and VCs. We're hearing from a lot of people that they need to subscribe to seven newsletters every morning to cover their industry and it's too much. And they want to figure out some way to get it in one rather than seven. And so we're continuing to figure out how can Nuzzel help people save time

• 27:16Speaker 02

  and find the stuff that they really need to know about. So they don't miss it, but that they can actually cope with with the amount of of content that's coming at them and save time.

• 27:24Harry Stebbings?

  Well, Jonathan, I look very forward to you continuing to solve my content discovery problems. As I said, huge fan here, recommend it to everyone. And I can't thank you enough for coming on the show again. It's been such a pleasure.

• 27:35Speaker 02

  My pleasure, Harry.

• 27:38Harry Stebbings?

  And as I said at the start, such a great pleasure to have Jonathan back on the show, such a good friend to the show, and I can't thank him enough for all he's done. He really has been a tremendous support. And you can follow him on Twitter at Abrams, and I must insist, see you download Nuzzel. As we said, it really is a must for me every single day. And you can also follow us on Snapchat at H Stebbings with two Bs. It'd be fantastic to see you there, where you can see all things behind the scenes from the 20 minute VC. But before we leave you today, Pendo helps companies create products that customers love. It was founded when alumni from Rally, Google, Cisco and Red Hat combined their heads and their hearts to build something they wanted but never had as product managers, a complete platform for product teams. With Pendo, you can understand product usage and rapidly make data-driven decisions.

• 28:21Harry Stebbings?

  Survey users in-app for NPS and feedback, deliver contextual help to improve UX and user onboarding, promote new features in product to drive. ...adoption without requiring any engineering resources. Pendo is the proven choice of innovative product leaders at Salesforce, Optimizely, Citrix and many more leading companies. Learn more today at go.pendo.io/harry. That's go.pendo.io/harry. But what if you're starting out in the industry and want to learn to code like I was four years ago? I went to Treehouse, the online school where you can learn how to build websites and apps. Their course library has thousands of hours of content where you can learn all sorts of topics, including JavaScript, iOS, Android and more, with high-quality video instructions

• 29:03Harry Stebbings?

  from real industry experts teaching you all you need to know and quizzes and co-challenges keeping you engaged and on track. Learn on your own schedule and go from beginner to pro. So simply head over to teamtreehouse.com to start your free trial. As always, I so appreciate all your support and I cannot wait to bring you a very special surprise week on the show next week. Stay tuned.