20VC: Index's Danny Rimer on Investing Lessons from Hits like Figma, Discord and Etsy to Missing Snapchat, Airbnb, Facebook & Spotify | Why Valuation is a Trap and Market Sizing, Signalling and Sector/Geo-Specific Funds are all Noise

The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

The Twenty Minute VC

Finance, Venturecapital, Tech News, News, Siliconvalley, Technology, Investing, Startups, Business

4.4 • 637 Ratings

🗓️ 17 June 2024

⏱️ 74 minutes

🔗️ Recording | iTunes | RSS

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Summary

Danny Rimer is a Partner @ Index Ventures and one of the most prominent VCs of the last two decades. Danny has led Index to be one of the top global firms on both sides of the Atlantic. Among Danny's incredible portfolio, he has led or been involved with Figma, Discord, Dream Games, Etsy, Glossier and Patreon.

In Today's Discussion with Danny Rimer We Cover:

1. The Biggest Lessons from Missing Snap, Airbnb, Spotify and Facebook:

How did Danny miss investing in Brian Chesky and Airbnb when Brian says "Index is the best investor that Airbnb never had"?
What was Danny's biggest takeaway from turning down Daniel Ek and Spotify multiple times?
Why did Danny turn down the chance to invest in Facebook at $10BN? What did he learn from this?
Why did Index not lead Snapchat's Series B? How did that decision change Danny's mindset towards the concentration of positions in a fund?

2. The Biggest BS Rules in Venture: Market Sizing, Valuations and Signalling

Why does Danny believe that "valuation is a mental trap"?
Why does Danny believe that TAM is "noise" and should not be used to assess an investment?
Why does Danny believe that stage, sector and geo-specific funds are BS?
Why does Danny believe there are no IPO windows? Are IPO markets always open to the best?
Why does Danny believe that signalling is BS and does not exist today?

3. Lessons from the Biggest Wins and Losses:

What are Danny's biggest lessons from Index's $BN win in King (Candy Crush)?
How did the Discord deal come to be? What are Danny's biggest takeaways from it?
What are Danny's biggest reflections from losing 10s of millions on Nasty Gal?
What is Danny's biggest advice to a new investor today?

4. Lessons from Two Decades Building Index into a Premier Firm:

What specifically has Index done to enable them to do what no one else has done and win on both sides of the Atlantic?
How did the Benchmark partnership shape much of how Danny has constructed Index today?
Who does Danny view as Index's biggest competition? How has it changed with time?
Why is Danny more bullish than ever on the UK despite Brexit?

Transcript

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0:00.0	The main thing is to keep the main thing, the main thing.
0:02.7	If the person's extraordinary, throw all theses out the window and just back the founder.
0:07.3	One of our tenants is definitely that market-sized tam is noise.
0:11.1	I do believe that the best companies at that stage when they are ready to go public, can go public in any market.
0:18.1	I'm not a huge fan of sector funds.
0:20.1	With sectors, you're not looking for the best companies. You're looking for the best company in any market. I'm not a huge fan of sector funds. With sectors, you're not looking
0:21.3	for the best companies. You're looking for the best company in that sector. Most companies create
0:27.1	brands as a byproduct of a great product. So scarcity and brand really go hand in hand. Welcome to 20VC
0:33.5	with me, Harry Stebbings. And today's show is the type of show that makes me feel so lucky to do
0:37.8	what I do. I always say I'm a student of venture, I'm building a firm, and I should learn from the best in the world, who've done it, seen what I'm going through, and know how to execute. And so I could have no better guests than ours today, Danny Reimer, partner at Index, and one of the venture greats of the last 20 years.
0:55.2	At Index, he's led or been part of deals into Figma, Dream Games, Discord, Etsy, Glossier, and many more.
1:02.3	He's also a friend, and has been an incredible supporter's 20 VC over the last decade,
1:07.0	and so I want to say a huge thanks to him for his support and kindness over the last 10 years.
1:11.4	But before we dive into the show today, we're all trying to grow our businesses here.
1:15.4	So let's be real for a second.
1:17.1	We all know that your website shouldn't be this static asset.
1:20.4	It should be a dynamic part of your strategy that really drives conversions.
1:24.7	That's marketing 101.
1:26.2	But here's a number for you. Fifty-four percent of
1:29.0	leaders say web updates take too long. That's over half of you listening right now. And that's
1:34.6	where WebFlow comes in. Their visual first platform allows you to build, launch and manage
1:39.6	web experiences fast. That means you can set ambitious marketing goals and your site can rise to the
	...

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