20VC: Sahil Lavingia on Rolling Funds and Their Impact on The Future of Venture, How To Evaluate Market, Team and Product, The Value of Party Rounds & The Pros and Cons of Multi-Stage Funds Investing at Seed
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
The Twenty Minute VC
4.4 • 637 Ratings
🗓️ 24 August 2020
⏱️ 45 minutes
🧾️ Download transcript
Summary
Sahil Lavingia is the Founder and CEO @ Gumroad, the company that helps creators do more of what they love. With Gumroad, Sahil has raised funding from an all-star list of investors including Accel, Kleiner Perkins, First Round and then Max Levchin, Chris Sacca, Ron Conway and Naval Ravikant on the individual side. However, most recently Sahil has made waves launching one of the first rolling funds on AngelList with his being $6M per year. In the past, Sahil has backed the likes of Lambda School, Figma, HelloSign and Haus to name a few.
In Today’s Episode You Will Learn:
1.) How did Sahil make his way into the world of startups and angel investing? What were his biggest takeaways from being employee #2 at Pinterest? How did that experience impact his mindset?
2.) Why did Sahil decide to make his new fund an AngelList rolling fund? How is it structured? Does Sahil think this will represent a seismic shift in early stage investing? Is this a game of the 1%? Why does Sahil think early-stage remains so undervalued? How will this impact Series A pricing?
3.) How does Sahil assess his own price sensitivity today? How does Sahil think about the right way to turn down a founder? Where do many go wrong? How does Sahil feel about the rise of pre-empted rounds? How does Sahil advise seed founders with offers from multi-stage firms?
4.) What does Sahil believe founders care most about today in their investors base? How does Sahil think about investor brand and distribution? How does Sahil analyse the pros and cons of party rounds? How does Sahil advise founders on constructing their early cap table?
5.) How does Sahil think about his relationship to risk and to money? How did Sahil deal with it when his investors wrote off his company? How did Sahil feel about the weight of expectation placed on his shoulders at such a young age? How did he deal with this?
Items Mentioned In Today’s Show:
Sahil’s Fave Book: How to Win Friends and Influence People
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Transcript
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| 0:00.0 | This is the 20-minute VC with me, Harry Stebbings, and what is the most talked about topic of the moment, |
| 0:04.4 | the rise of rolling funds by Angel List, and one of the first and most prominent was raised by |
| 0:08.9 | Sahil Lavinia, and so I'm delighted to welcome Sahil to the hot seat today to discuss the new |
| 0:13.3 | fund. For those that do not know Sahil, he's the founder and CEO at Gum Road, the startup |
| 0:17.7 | that helps creators do more of what they love. With Gumroad, Sahil has |
| 0:21.5 | raised from some incredible investors, including Excel, Kleiner Perkins, first round, and then on |
| 0:26.5 | the individual side, Max Levchin, Chris Saka, Ron Conway, and Naval Ravakant, to name a few. However, |
| 0:32.1 | most recently, as I mentioned, Sahil's made waves, raising one of the first rolling funds on Angel List, with his being |
| 0:37.9 | $6 million per year. And in the past, Sahill has backed the likes of Lambda School, Figma, |
| 0:43.0 | hello sign and house, to name a few. I'd also want to say a huge thank you to Cindy Byer and |
| 0:47.2 | Manisha Rora for some fantastic question suggestions today. I really do so appreciate that. |
| 0:52.3 | But before we move into the show today, I'm sure you've |
| 0:54.3 | heard about it, but my word, there is a product that I love, Carter. Carter simplifies how |
| 0:58.7 | startups and investors manage their equity, track camp tables and get valuations. Go to carter.com |
| 1:04.4 | forward slash 20 VC to get 10% off. More than 800,000 employees and shareholders, use Carter to |
| 1:10.4 | manage hundreds of billions of |
| 1:11.7 | dollars in equity, and Carter now offers fund administration so you can see real-time data |
| 1:16.4 | in the Carter platform and work with Carter's team of experienced fund accountants. Again, |
| 1:20.7 | that's go to carter.com forward slash 20 VC to get 10% off. And speaking of amazing products, |
| 1:26.3 | if you've been listening to 20 VC before, you've probably |
| 1:28.7 | heard of Brex, the first corporate card for startups with no personal guarantee or credit |
| 1:33.4 | check, up to 20 times higher credit limits than traditional cards, plus rewards like 3x on |
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