20VC: IA Ventures' Jesse Beyroutey on Game Theory and How It Impacts Investor Mindset, How To Avoid "The Pressure To Deploy" Today In Venture & Why Ownership Is The Single Most Important Parameter When Investing
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
The Twenty Minute VC
4.4 • 637 Ratings
🗓️ 22 July 2019
⏱️ 36 minutes
🧾️ Download transcript
Summary
Jesse Beyroutey is a General Partner @ IA Ventures, one of the top-performing early-stage funds of the last decade. Their incredible portfolio includes the likes of TransferWise, DataDog, Digital Ocean, X.ai and The Trade Desk, just to name a few. As for Jesse, his investments at IA include Digital Ocean, IronClad, TransferWise, Sight Machine and more fantastic companies. Prior to joining the world of venture, Jesse studied Systems Engineering at the University of Pennsylvania.
In Today’s Episode You Will Learn:
1.) How Jesse made his way into the world of VC pretty much straight out of University and how that led to his being a GP with IA today?
2.) What is Game Theory? What does it mean to Jesse and how does it impact his investing mindset today? How does Jesse think about and assess startup positioning today? How important is positioning in the early days of the company? How does Jesse think about data as a sustainable moat or not? Does Jesse think in today's excess supply of capital environment that cash alone can be a moat?
3.) How does Jesse and IA think about portfolio construction today? Does Jesse ever feel the "pressure to deploy"? How have IA structured their own fundraises to ensure they never feel that pressure? How important a role does ownership play for Jesse when making an investment? Does Jesse believe ownership is built on first check?
4.) How does Jesse assess his own price sensitivity? How has it changed over the last 8 years? How does Jesse and IA approach both investment decision-making and reserve allocation decisions? How does the lead rely on the rest of the team when making decisions? Why does capital efficiency become a core question when determining reserve allocations?
5.) Why does Jesse feel that the reading to writing ratio that currently exists between founders and investors needs to change? What should the ratio be? How does the relationship between founder and investor change when the investor provides more content? How does Jesse look to avoid news cycles in the week? What works? What does not? What is Jesse's advice for anyone looking to do the same?
Items Mentioned In Today’s Show:
Jesse’s Fave Book: 7 Powers: The Foundations of Business Strategy
Jesse’s Most Recent Investment: Gauntlet
As always you can follow Harry, The Twenty Minute VC and Jesse on Twitter here!
Likewise, you can follow Harry on Instagram here for mojito madness and all things 20VC.
Transcript
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| 0:00.0 | Here we go, another 20 minute VC with me, Harry Stebbings, and I'd love to see you on Instagram |
| 0:03.9 | at H. Stebbings, 1996 with 2Bs, largely a combination of gym routines and mehitos, hopefully not |
| 0:09.5 | at the same time, but to our episodes day, and I'm thrilled to feature one in the industry's |
| 0:13.2 | hidden gems, both in terms of funds and partners. And so with that, I'm so excited to welcome Jesse Beiruti. Now Jesse is a partner at IA Ventures, one of the top performing early stage funds of the last decade. |
| 0:23.6 | Their incredible portfolio includes the lights of transfer wise, data dog, digital ocean, X. |
| 0:29.6 | Dot AI, and the trade desk just to name a few. |
| 0:31.6 | As for Jesse, his investments include Digital Ocean, Ironclad, TransferWise, Site Machine, and many more fantastic companies. |
| 0:38.9 | And prior to joining the World of Venture, Jesse studied systems engineering at the University |
| 0:42.6 | of Pennsylvania. And I do also have to say Jesse's partner, Roger Ehrenberg, who I have been |
| 0:46.8 | lucky enough to have on the show in the past, writes the most phenomenal blog, my favourite |
| 0:50.6 | in the world of venture. And you can find out more at infoarbitrage.com. |
| 0:54.6 | But before we get into the episode today, I'd like to give a big shout out to my friends |
| 0:57.9 | over at Multiple. |
| 0:58.8 | Widely regarded as the go-to firm for game-changing companies when it comes to building your |
| 1:02.9 | brand, crafting your culture, and gearing up your growth. |
| 1:05.8 | They've worked with breakthrough companies such as we transfer, pipe drive, mix cloud, |
| 1:09.9 | unbabables, signal and |
| 1:11.2 | and calo. And when we set up stride.VC, they were the first call we made to help us get |
| 1:15.5 | our story straight. And what makes multiple really special is their empathy for and experience |
| 1:20.1 | of the entrepreneurial journey. That's because they've actually been on the front line |
| 1:23.3 | themselves, backing, building and growing, and even selling businesses as founders, operators and |
| 1:28.5 | investors. So drop them a line at Grow at we are multiple.com with the subject line 20 minute VC |
... |
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