20VC: Why the IPO Market is not Closed | Why Revenue Multiples are BS and Founders Need to Change | Advice From Jack Ma, Jamie Dimon and Evan Spiegel | Lessons from Taking Snap & Alibaba Public with Imran Khan

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

🗓️ 26 August 2024

⏱️ 65 minutes

🔗️ Recording | iTunes | RSS

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Summary

Imran Khan is the OG of IPOs having taken some of the biggest companies public including Alibaba, Snap, Box, Weibo and more. Today, Imran is the founder and Chief Investment Officer of Proem Asset Management. Prior to co-founding Proem, Imran served as Snap Inc.’s Chief Strategy Officer. Under his leadership, Snap’s annual revenue run rate increased to $1.6 billion from zero in less than four years. Previously, Imran was a Managing Director and Head of Global Internet Investment Banking at Credit Suisse where he advised on more than $45 billion-worth of Internet M&A and financing transactions.

In Today's Episode with Imran Khan We Discuss:

1. The IPO Market: When Does it Open:

How does Imran assess the state of the IPO market today?
Can companies really go out with $100-$200M in revenue?
Will we see revenue multiples reflate? Can venture continue as an asset class if they do not?
When does Imran expect the IPO market to really open?

2. Is M&A F******:

How does Imran assess the state of the M&A market today?
How do founders need to change how they think about M&A? Why are they to blame for the lack of M&A activity we have today?
To what extent can we blame Lina Khan for the lack of M&A?
Why would a company go do an M&A process today when it is unlikely to be approved by the SEC?
Why does Imran believe in the case of Wiz, it was a mistake for the company not to do the M&A?

3. AI's $600BN Question: Capex Spend:

How does Imran analyse the insane capex spend we are seeing from Meta, Google and Amazon?
How does Zuck not having his cash cow as the cloud business change how he can act?
How does this compare to Google's capex spend 20 years ago? What can we learn from that?

4. Going Public: The Process, The Players and Jack Ma & Jamie Dimon:

What is the literal process to take a company public?
Who sets the price? What do large institutions want in companies going public?
What are some of Imran's biggest lessons from taking Snap and Alibaba public?
What are some of Imran's biggest lessons from Jack Ma, Jamie Dimon and Evan Spiegel?

Transcript

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0:00.0	I don't think IPO market is closed.
0:01.7	I think the issue is companies don't want to go public because their expectations are too high.
0:07.8	If you're building a company for a long period of time and you have a good business and you generate cash flow,
0:13.0	you will create value.
0:14.0	What is your IPO prices?
0:16.0	It doesn't matter.
0:17.0	I'm a big proponent that companies should go public earlier than later.
0:20.5	When you're going to a public market, you are building a new relationship with a new group of investors.
0:24.6	I think any time you're trying to build a new relationship, my philosophy is give them more, give them a little bit more upside.
0:30.6	So be it.
0:31.6	No, revenue multiple is a BS multiple, right?
0:33.6	Why would somebody give a shit about revenue multiple?
0:36.6	I think the problem in MNA
0:38.2	market is...
0:42.3	God, I love those intros. This is 20VC with me, Harry Stebbings. Now, the core problem in venture today
0:47.4	is liquidity, both from M&A and IPOs. The liquidity taps have turned off and LPs are screaming for liquidity. So today we sit down with the OG of IPOs, the liquidity taps have turned off, and LPs are screaming for liquidity. So today we sit down
0:56.5	with the OG of IPOs, a man who's taking some of the biggest companies public from Ali Barbar to
1:01.9	Snap, Imran Khan. He was previously chief strategy officer at Snap, where under his leadership, Snap's
1:07.7	annual revenue run rate increased to $1.6 billion from zero in less than
1:12.6	four years, and he led Alibaba's $200 million investment into Snapchat. But before we dive in,
1:18.6	when a promising startup files for an IPO or a venture capital firm loses its marquee partner,
1:24.1	being the first to know gives you an advantage and time to plan your strategic
	...

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