Arthur Patterson, the founder of venture capital firm Accel, sits down for a fireside chat with super{set} founding partner Tom Chavez as part of our biweekly super{set} Community Call. Tom and Vivek sit back and review the tape - analyzing Arthur’s insight into the early days of venture capital, where venture stands today, how venture capitalists view long time horizons, and what he is most proud of from his long career.
Twice a month, the super{set} community comes together for a weekly call - often featuring fireside chats with outside speakers and friends of the super{set} Hive. On one such call, we were pleased to welcome Arthur Patterson - founder of the venture capital firm Accel and an investor in Tom and Vivek’s previous companies, Rapt and Krux.
At super{set}, we adamantly are not VCs. That said, we partner with VCs during our company build-outs, and there’s a lot to learn from the best venture capitalists. Arthur Patterson is perhaps one of the greatest VCs of all time, founding Accel as an upstart in 1983 and building out the firm to become the powerhouse it is today.
Tom and Vivek discuss specialization and the benefit of enduring focus, FORTRAN programming, Accel’s concept of “the prepared mind,” the benefit of tailwinds and being at the right place at the right time, and the joy of repetition and delayed gratification in entrepreneurship.
Learn more about how we at super{set} found and build data-driven companies at superset.com.
Transcript - Season 3, Episode 9
Tom Chavez: Welcome to the Closed Session, How to Get Paid in Silicon Valley with your host, Tom Chavez and Vivek Vaidya.
Vivek Vaidya: Hello and welcome to episode nine of season three of the Closed Session.
Tom: All right. Oh, before we were starting, you called it season nine, but it's actually... We're not that old where you are, but I mean=
Vivek: I was just.. Old or efficient, two sides of the same coin.
Tom: I like how you try to sell that. Nice.
Vivek: This is a special episode.
Tom: It is a biggie. What are we going to do this time? It's a little different from what we've done in the past, right?
Vivek: Yeah. Yeah. So think for our audience, we have these community calls every two weeks or so, fortnightly, as I like to say.
Tom: That's fancy.
Vivek: Yeah.
Tom: Community calls at Superset.
Vivek: At Superset, yeah. Every two weeks. And oftentimes we'll invite guests for fireside chats. And recently, I think the last episode or last community call of 2022, we had a very special guest and it was Arthur Patterson of Accel, formerly of Accel.
Tom: Arthur Patterson, who looms large for you and me, right? He's been an investor in both of our prior projects. We've been very lucky to have his involvement in many of the buildouts and things that we're doing today at Superset. He is one of the OGs of Silicon Valley venture capital.
Vivek: Indeed, indeed. So we had him... Tom interviewed him at this fireside chat at Superset offices, and we thought it'd be fun for us to play snippets from that fireside chat and then give our perspective and commentary on what we learned and what we took away from that chat.
Tom: Let's do it. And if you wanted to see the whole thing, I think we're going to take snippets or even extended versions of this and be blasting them out on different channels. But this is the super premium edited, perfect version of the goodies.
Vivek: The highlights reel.
Tom: Highlights. There you go.
Vivek: Plus, plus.
Tom: Let's do it. So let's jump in here, and the first topic that we're going to be showing you is a wonderful sort of vignette from Arthur on the early days of venture capital and what it was like to start Accel. Here we go.
(Start Interview Clip)
So let's dive in here, Arthur. I wanted to go back to the earlier days of Accel. You co-founded Accel with Jim Schwartz. What year was that? 19-
Arthur Patterson: End of '83.
Tom: '83. I'm curious if you could talk a little bit about the two or three traits that you looked for in hiring at Accel in those early days.
Arthur: You got to put it back in the context of that time. I got an venture business in '71 after working for the Treasury Department for a few years and said, Jim Schwartz and I had then had a firm as of '78 called Adler and Company and the venture business, it was, you had the nifty 50 in '69, you had a little high hot IPO market around semiconductors. And then nifty 50 and '72, '73-
Tom: By 70, I don't know what nifty 50 is.
Arthur: That was when... After the bubble in '69. Then there were selected 50 companies, of which Xerox and Kodak were the ones for all the institutions to own that were the growth companies. But underneath that, there was a sort of small venture business going on, was going Heiser that spun out of Allstate and raised a fund, which was the first fund. It was kind $80 million fund, and he started Amdal. Among other things, it's funny, he was an investment guy, but when he formed Heiser, he hired all operating people and then sure enough, two or three leaders, he had a portfolio of companies with his guys all running him as opposed to the investments that he'd been making for Allstate. And so '74, the business had virtually stopped. Tandem was only the only deal of note that even got done that year.
And I actually talked the bank into letting me buy the public companies because they were there and available in weren't any private deals, and they were very cheap. And so it gave me a lot of experience in public market investing too. So then from '74 in the City Corp portfolio at that point, which was sort of the index fund of the business, because we participated every... a lot of the good investments, federal express, everything, and that was six 50% underwater at that point in time. And by '78 though, that whole portfolio had compounded that 30% from '68 or '69 when they started the thing. And so that the venture business really got going in and about '78 you could begin to start a new fund and raise money. No one could really, before that. There were a few oddball little funds like Kleiner Perkins who were started in '72 or three, but they didn't have any money and hardly did anything. So we had Adler Company, we did about 50 deals in the next five years.
Tom: So you're at Adler company, what years? That was-
Arthur: Just '78 to '83-
Tom: Just before Accel.
Arthur: And then we could raise off of that record, we're able to raise Accel. Back to your point about what kind of person we're looking for, right? It's pretty early business. And it depends on what you're trying to do in your portfolio in those days, and there was no growth investing going on at all. And you hire very different people for early stage investing versus later stage investing. It's just completely different business. And so we would be looking for early stage guys at that stage. And the market was, in relative terms today, tiny. But most of the firms like KP and [inaudible 00:06:44] and Mayfield gotten started during that '78 period.
Tom: And so Accel is a relative upstart.
Arthur: Absolutely, but we had the good fortune of starting a new fund at a time when the market had gotten to a scale where you could begin to specialize. When we were running City Corp, we did a lot of all the technical deals. We also did sort of paper company buyouts and other things like that. Jim [inaudible 00:07:20] did a oil well services company, but the number of companies by '83 had gotten to the point where you could specialize, but it's very hard for existing firms to specialize because the partners had all done a variety of... They did a medical deal in the Semiconducting software deal and couple of other oddball deals and in the portfolios, and you can't change the relationships in early stage investing between partners.
You can't say one guy takes all the medical deals one guy takes, all the semi deals. So everybody else was just very spread. And so we said, well, Bain says that people with higher market shares do best. And so let's just choose a couple very... Jim Schwartz had done several notable communication deals like [inaudible 00:08:15] , and I'd done a few software deals as well as medical deals and semiconductor deals and everything else.
And I said, I saw software, and so I was going to do the software. He was going to do the... And then we hired a third partner who was going to do medical deals a little bit later. And by virtue of focusing and only doing those deals, it then allowed you to say, now what are going to be the best software deals or what are going to be the best telecom deals? And we could take a much more systematic approach to thinking about the business, which other people with their portfolios all bogged down and just a variety of things across the partners really weren't in a position to do. And so we took advantage of the fact that we're a startup and we had a clean start. Nothing like a clean start as we see every day. And so the prepared mind actually came from sort of derivatively.
We were able to think about what sectors we really wanted to be in and who we should get to know and everything in a way that people previously hadn't. And that we began to articulate it as a prepared mind. And we would say the test of the prepared mind is that when that entrepreneur walks in the door, 90% of his business, you just haven't found that the entrepreneur is critical and he's going to supply that critical 10% of the idea, but 90% of it, or you're not going to either bond with that entrepreneur or recognize the idea quickly and move ahead with it. And I think my best deal was, I was later, but it had been turned down by all the other venture guys who said, wow, we might be interested, but we've, you got to get a decent CEO in here. And because I'd been in the business and I'd been in the internet services business, and I knew how important the billing systems were, and so I had a prepared mind that recognized the opportunity that other people got stuck on the red herrings of it's not the right management. And
Tom: That was portal.
Arthur: It was portal, thousand to one.
Tom: Thousand to one. That's better than a stick in the eye.
Arthur: Right.
(End Clip)
Tom: All right. Well, that was fun. Funny for us to be listening to that Vivek as Arthur refers to this oddball company called Kleiner Perkins, because when we came up in the super late nineties, early odds, Kleiner Perkins was ruling the roost.
Vivek: Loomed large, as it still continues to do.
Tom Chavez: Though, without the same luster, let's say, as the dominance that they exerted in that time. But the other thing that really strikes me here, and that I think it's an idea that we're carry forward for sure in our own work, is this idea of specialization. So we, like Arthur mean, and it's just one of those generalists, I don't know how many generalists survive for the long haul. They seem to have their moments, but what feels more enduring is the ability to focus on a particular set of issues and challenges and to play to your strength as we try to do at Superset in the realm of data management, we queue to this data-driven thesis feels like a lesson we implicitly learned from Arthur now.
Vivek: No, exactly. Exactly. The other thing that struck out for me is in the early to mid 80s, the definition of software, what constituted software is, must have been so different or compared to now. Now software is so huge as compared to what it must have been in the early to mid 80s.
Tom: And that's so cool about thoughts wearing computer science and AI. Computer science as a field, software engineering as a discipline are pretty fascinating in the way that they continually reinvent themselves. When you went to college, you were learning FORTRAN , right? When I came up, I had summer jobs programming on base in Albuquerque at Sania and Kirtland Air Force Base in FORTRAN.
Vivek: Yeah, yeah.
Tom: Were you a FORTRAN program too?
Vivek: I actually ended up learning quite a lot of FORTRAN because of my focus in math and medical beginning.
Tom: But how much FORTRAN C programming is going on these days?
Vivek: Very little.
Tom: Flat. Almost close to zero, right?
Vivek: Yeah. Well, I'm actually... I think it's commercially, I don't know how much FORTRAN programming ever went on, but I'm sure in numerical computation labs or whatever, they were still doing FORTRAN programming. They may still be doing it, who knows? Or maybe python's taken over.
Tom: The point is was when Arthur's talking about software back in the 80s, and not to sound too snooty about it, but it just sounds kind of adorable relative to what we're doing today. But again, that's the magic of computer science as a field that continually embraces the new, continually embraces new frameworks, new possibilities. It doesn't get sort of high bound and stuck in old patterns.
Vivek: Your car is a big computer. And the other thing that struck me is, as you was talking about the early days of Accel, is they think of or thought of Accel as a startup, which it is.
Tom: Yeah. Well, it's kind of funny to talk about Accel as a startup today. Maybe if they're scrappy and doing it right, they're still thinking of themselves in that way. But most observers would look at Accel and say, no, no, no, that's a behemoth.
Vivek: Of course, now. Yeah, totally a behemoth. But it's instructive for me also, as we think of Superset, there's always this, we like to tell people that we're company builders with capital operators with capital, but there is the fund aspect of Superset as well, and it is a startup.
Tom: Oh yeah, yeah.
Vivek: Focusing on, like you said, data-driven thesis. And we're very intentional about what problems we want to go solve and companies we want to build, et cetera. So in that regard, a venture capital firm in the early days of its existence is very much like a startup.
Tom: Right. And these were the buccaneers of VC, right? Sequoia XL was the relative upstart. I guess KP was at it, but it was still, it's kind of just, again, adorable to think about the hundreds or thousands of funds and venture capital firms out there now. Yeah. Relative to the whatever, five to ten-
Vivek: Correct.
Tom: You had going back then. All right, let's tee up the next clip here. This is-
Vivek: Actually before we do that. Yeah, I think it's... Let's talk about this whole concept of the prepared mind. And we also benefit, we've learned about it from Arthur and I find it fascinating when he says that prepared mind means that 90% of the entrepreneur's business when they walk in your door and the extra ten percent is what the entrepreneur add in terms of special sauce or know-how whatever-
Tom: Which is not to say that the entrepreneur is fungible.
Vivek: Correct.
Tom: As many, unfortunately snooty venture capital funds fell into the trap of believing.
Vivek: Correct. Correct. So I thought that was fascinating and that's something that we internalized too in the solution memos that we write at super. That's our way of being prepared for what lies ahead when we embark on this company building journey for a new company.
Tom: That's right. The prepared mind, by the way for our listeners is a nod back to Luis Pasture who said that chance favors the prepared mind. In our notes here we have the original quote in French. Would you care to read it for us?
Vivek: No, Tom.
Tom: Okay.
Vivek: If my wife were here, she would've read it, but I would not insult the French language by try to read French.
Tom: Probably a good idea. In American the way we say it is, chance favors the prepared mind. All right. Okay. Shall we tee up the second clip?
Vivek: Let's do it.
Tom: This is on time horizons in venture capital. Here we go.
(Start Interview Clip)
Arthur Patterson: Working in early stage deals, it takes potentially, I mean I'm in one, I've been in for 23 years now. Eight is a more reasonable number and five if you're lucky.
Tom: By the way, if I can say it among venture capitalists, well, you're unique in lots of ways, but especially that way because I think one could argue that many venture capitalists have very short attention spans. 23 years.
Arthur: Yeah. Well, I didn't mean it to be [inaudible 00:17:11]-
Tom:[inaudible 00:17:13] too. But I think it's safe to say also many, many others in your cohort would be like, okay, somebody else, please bust these rocks. Please handle this.
Arthur: But it also fits with your perspective. Different firms have different approaches to this. So we being new in Accel and being focused by industry, we took an approach to if we thought we had the thing pretty well dialed in as a good idea. Now it's very, you have to get a tailwind in these markets. It's not just the entrepreneur, but the timing of that is really hard to predict and you know can see it coming, but geez, when's it going to really click into the enterprise market or whatever. And so we were very stick to it in our projects and would carry them a lot longer and we'd have much higher percentage wins, but sometimes they took quite a while. Somebody like say, Sequoia, who'd been in the business for a long time or KP, could take the approach that we've got a better supply than other people because we've got the relationships and the franchise and they don't perform, they got to go. And they were known to be ruthless, but the company the entrepreneur didn't perform. And so-
Tom: Why did you stick to it? Why stick to it like you did?
Arthur: Well, because you... If you feel have to judge whether you're making progress or not. And at that point in time, every year you had to go out and raise money from somebody and that was a third party. And some companies just stay on that initial product plan and Excel spreadsheet, but it's a very small percentage of them and ten, maybe 20% and let them wander. And they may be making progress, but the market's evolving a little bit differently than you thought and you're having to move software particularly can be malleable. That's why we pretty much gave up hardware projects because boy, if you don't get it right day one that there's no money for the next generation. And whereas software you could move around quite a bit. each year you had to prove that what you were doing was the leader of this new opportunity.
And quite the criteria changed a bit, but you had earnest, good, intelligent, capable people working on the idea trying to prove it out and prove on it. And so they weren't making progress quite the way you intended. But I mean I've had some that there was Veritas where, which was a tandem competitor and in nonstop computing and there got down to where we raised in those days what would've been a billion dollars today to build this company. And we ran the Korean social security system and some other big apps, but hardware was going out of fashion. And one ways we got to a meeting, we only had about a million in the bank left over and we figured we had to sell the company, not once but about ten times to raise the amount of money necessary to build it. He said, I said that you guys have rebuilt the Unix operating system to be able to operate in this distributed environment.
And we have any software in there. And I've been sort of a student of the public software companies that were selling components going into IBM . And they said, yeah, well the file system, we really did a lot of great work on the file system. And so we reinvented the company around the file system and Joe Schondorf went off and got AT&T that owned Unix to declare it to be the high performance file system for Unix. And that turned into a $40 billion capitalization from so, but you don't want to have to do that too often.
Tom: From zero to hero, from the gutter, most to the uttermost, a billion dollars left in the bank to 40.
Arthur: But so back on the people. So I think you have to, people that are sufficiently curious and interested in the business and keep their heads down and it's working on early stage deals is kind of lonely. So even if you're in a partnership, it's your deal and it's your problem and you've got to keep coming back to your partners and telling them, oh no, we should keep supporting it. And still, I know it's not happening quite the way I laugh. I know I told you it was that, but now this-
Tom: Time I'm serious.
Arthur: So you're responsible. We always have a quote backup guy at Accel, but he can get pretty far back when they're not working. And so-
Tom: Keep him in the basement.
Arthur: As I say, maybe they'll straight up and you can recruit a lot of fantastic people to it. We did it at portal, but frequently you're just working away on this thing with the entrepreneur trying to help them figure it out and help them raise money and help them find the strategy and recruiting people. And so it's this sort of long lonely process. It might go on for five, eight years or more and you have to have individuals that are curious enough and just sort of don't have too much hubris because it's the other guy that's always be responsible. And if you go in and grab the steering wheel, I mean you're dead.
(End Clip)
Tom: Wow. A lot of good stuff there. What's your immediate reaction?
Vivek: The first mean, lots of immediate reactions, actually, I'll try to prioritize. The first one is this whole idea of tailwinds or as some people like to say, right place, right time. And we definitely benefited from that at Crux because as we had said along the way, what we were doing at Crux, people had tried that before and it didn't work the way it did for us because of this confluence of so many things, which collectively could be referred to as tailwinds for our business.
Tom: There'd been at least six to eight other players before us. By the way, people forget there were six to eight other search engines before Google came along. By the way, Crux wasn't the same kind of outcome as Google, obviously, but the pattern bolts up. You got to believe you have to have some tailwinds and a little contrarianism to believe that okay, number nine could be the one.
Vivek: And then also related to that is even when you have the tailwinds, it's not like it's a slam dunk. It still takes time. Five, eight, ten, 23 is just unimaginable from where I'm sitting right now. I don't know how that would work, but-
Tom: 23 years, my goodness.
Vivek: Yeah. Yeah. That was actually... Yeah, long time ago. So the takeaway for me over there is another interesting one, which is you have to have the right people who are curious and find joy in solving these problems that keep coming up.
Tom: One of our memes for company building along the way has been finding joy in repetition. It's a quote of a Prince song from Graffiti Bridge. Joy in repetition. What Arthur's calling us to do, and we've certainly found this to be the case for ourselves, is if you need a quick hit, if you're looking for immediate gratification, none of this is for you. It is a long pride swallowing, soul sucking siege, every one of these build outs. And you got to have to find, to your point, enough joy and just intellectual nourishment in the uncovering of each one of these little puzzles on your way to solving the uber grand puzzle.
Vivek: And I think what I've learned, I should say make it personal, is that in what appears to you to be repetitive or even, oh, I'm just doing the same shit, different day kind of thing. If you take a step back and you look for interesting, challenging problems to solve, even in that kind of process of doing the same thing over and over again, there's plenty of problems to be found.
Tom: That's right.
Vivek: And I think that's what brings me joy. That's what brings you joy in this company building journey that we're always on.
Tom: If you're bored, well either there was a selection problem at the very beginning where you shouldn't have signed up for any of this or in a couple moments, I think we've seen it. Whereas people just lose their spark, they lose their mojo, and then, okay, sadly, it's also time to just piece out. If you lose that basic spark, it's time to just hang it up.
Vivek: And the final thing kind of wrapping this up is I like when he talks about this notion of what I take away as personal causal responsibility, it's your deal. He says, even though you're in a partnership and you may have a backup, but that backup is way far back. It's your deal. You have to show up in front of the partnership and give these updates and you have to help the entrepreneur.
Tom: We've seen this once or twice as well. And by the way, we say co-founders, anything that's going on with the company is your problem. You might be a product oriented co-founder, here's a sales issue, still your problem.
Vivek: Correct.
Tom: You bleed the company and we find the CEOs and the founders who start to externalize and say, well, that's something else going on. There's somebody out there or the gods are conspiring to keep me down, or any way or any moment when you start making those kinds of excuses, you're not exerting personal causal responsibility and you've lost the plot. Hey, let's go to the second clip. This is a good one where we ask Arthur, hey, what are you most proud of? This was your question.
Vivek: Yeah. This is my question.
Tom: This is a brilliant question. Yeah, it's a beautiful answer. Here we go.
(Start Interview Clip)
Arthur Patterson: I find the profession to be very satisfying in total because you literally get always thought, I feel you're doing good, you're doing well by doing good every day. You're helping, you know, could be a teacher in a school, or you could be working with your companies and trying to teach entrepreneurs and give them all the thing, tell them all the mistakes you've made so they don't waste, our money making the same mistakes. And so that's very satisfying. And you're creating all these jobs for so many people and creating interesting lives for them, and you're making out well yourself. But you feel that believe our whole standard of living is dependent on the market system, free market systems, and the entrepreneurs being a critical element of that. I mean, I think these big companies just become so unproductive that our standard of living in the country wouldn't be very good.
It'd be like living in Russia almost if the big companies had the only balls in town. And I mean, not quite. So I think that this... Look at the contribution of Silicon Valley, not just to the United States for the whole world, and who were the greatest beneficiaries of globalization, Russia and China, they haven't figured that out yet. And Silicon Valley, what are they just copying all the stuff in Silicon Valley. And so I think it's a very satisfying profession to be in. The individual company can go up and down. And I definitely feel about it better when they're going up than when they're going down. But fortunately I got some marbles on each side. So one's going, gone up that's gone down.
(End Clip)
Tom: Well, that is a lovely answer and it was important, I think for our hive to hear this from, again, somebody who is very appropriately lionized as mega successful capitalist. Yes. And we certainly agree competitive markets and capitalism are the foundation of free, fair, open societies. And we can't take that for granted. But yeah, it's about wealth for yourself and your shareholders. But we are also importantly, like Arthur, we think trying to create wealth for families and societies and it's probably the most nourishing part of the job.
Vivek: Absolutely. I think we've said many times along the way that one of the many reasons why we do what we're doing is to help people want to help people realize and do things that they even didn't think they were capable of. And in the process make their lives better, create immense wealth for them and their families. I find his response so grounded. If you look at it from one perspective, oh yeah, you're so full of yourself, but it's such an actualized response and such a practical response that if you look at the, and there's all this talk these days about Silicon Valley coming to an end and the big tech this and surveillance data of that and all of that, and all those things are true. But if you look at the long arc, that's what he's talking about, if you look at the long arc, there's a lot of wealth and value and innovation that's come out of Silicon Valley that's made the whole world a much better place.
Tom Chavez:
And I think sometimes, you know, and I are talking to young up and comers and we find that they're a little squeamish when you ask them, hey, what do you want? Why are you doing this? They're a little squeamish when it comes to talking about creating wealth. And you and I both given our backgrounds, are careful to remind them, hey, don't ever apologize for wanting to create wealth for yourself and your family. If you come from humbled circumstances, especially if you didn't grow up with a trust fund. Or even if you did, but especially if you didn't, wealth matters. And so it is really important part of everything we try to do and build over here at Superset. And we're following really in the path that Arthur and others have established. Shall we turn our attention to the last question here?
Vivek Vaidya:
Let's do it.
Tom Chavez:
Is it problematic that venture funds are getting so big? Let's take a listen.
Thank you, Superset.
Vivek Vaidya:
That special addition from Tom is when he comes out of the nap room at Superset, he naps a lot. For those you don't know.
Tom Chavez:
Naps are very important. And for anybody listening, you better take a nap when you're not making any sense in a meeting. I tell people, do you need a little nap? There's maybe 20 minutes you can come back and then you would make a little more sense than you're making right now. It's just an idea.
(Start Interview Clip)
Arthur Patterson: Well, I think the funds that have that raised enormous amounts of money will be at a disadvantage in doing good early stage investments. And I think what they have going for them is that they've got good franchises. And it's like I was talking before about how we had to take a distinct approach because we didn't have a built up franchise, so we didn't have as good a supply. And so the funds, like Sequoia example, have... It's so valuable to a new company to get Sequoia's name on them that they will continue to have a good supply at the front end there. And even if they let the team and the efforts kind of become diluted, I think somebody like KP neglected their early stage stuff to some extent, they got off on the clean tech and they didn't protect their franchise. But it's hard to protect your franchise because it's so much harder to do this early stage business than the later stage.
So the people in the firm naturally gravitate to the easier projects. So you have to keep renewing and getting new people in there. So it's been an enormous explosion of early stage funds though underneath that. And those guys, they may not have the franchise flow going for them, but they may be able to with effort. We did come up with approaches that sort of work to find more good projects. And it's a competitive world out there. Some guys got some advantages and disadvantages, and the question is, can you make the best of your advantages and diminish your disadvantages? And I don't think... No question that the Sequoia partner that's now got five houses and two yachts is not going to be rustling around Silicon Valley at seven o'clock in the morning looking for the new deal. So the newer and more energetic guy might be.
(End Clip)
Tom: Well, there you have it. Five yachts, two yachts, sorry, my bad. Five yachts... Five houses and two yachts. That's a lot.
Vivek: It's a lot.
Tom: How many yachts do you have?
Vivek: Me?
Tom: No, we don't have to talk about it on the podcast. That's a little too personal. I resend that question.
Vivek: I have zero yachts.
Tom: Really? Yeah. How many personal jets?
Vivek: Huh?
Tom: How many personal jets?
Vivek: There's such a thing called a personal jet.
Tom: Yeah, your personal jet. Hello? Oh, I like the whole playing dumb thing.
Vivek: I have no idea what you're talking about.
Tom: Clever. Okay. That's a [inaudible 00:35:55] people. So I mean, think there's a lot of useful insight there and it kind of, for me, dovetails back to the specialization point. When you get that big, you're allocating capital. Are you really in a lane? Are you really committed to the craft? Are you generating IP that continually feeds that sort of prepared bind approach? It's hard for me to see how you square both heads against the middle.
Vivek: The middle. Yeah. I think early stage investing is also, there's a lot, there's a correlation between early stage investing and non-consensus investing. And when you're, like you're saying allocating large amounts of money when you're doing... When you're big fund, then it's hard to do non-consensus investing. You end up doing
consensus and therefore you find it hard to do early stage.
Tom: That's right. Well listen, as we wrap up, this sort of best hits from the interview with Arthur, by the way, in the next episode, there's yet more goodies that get a little more personal and focused on company building. So more coming, but as we wrap up this episode, Vivek, what are the biggies? What are the key takeaways?
Vivek: I think the first one is just this, he keeps coming back to grit and humility and lack of ego, right? In that you just need to have the straits.
Tom: Which we spent a lot of time talking about in previous podcasts.
Vivek Vaidya: That's right. That's right. So yeah, that was the one that was the big thing for me.
Tom: And from the venture capital perspective, what we're hearing from Arthur is from that side of the table as well. You have to delay gratification. You have to stay curious and keep [inaudible 00:37:35] link away at the think as. It's not going to happen as instantaneously as young urgent bucks would like it to.
Vivek: It's a long game. You got to play it.
Tom: That's right. What about tailwinds? There was a note in there about tailwinds too.
Vivek: And that we talked about that we trust on that briefly earlier, the whole right place, right time dynamic. You may have the perfect idea, but it may not be the right time for it.
Tom: That's right.
Vivek: Because the business models are not set up correctly. The situation in the market is not set up correctly for whatever reason. So you need to have tailwinds behind you to make the idea or your company successful.
Tom: There you go. With that, let's call it a wrap. And again, in the next podcast, we're going to continue along these lines with snippets from the conversation with Arthur, but with more focus on company building and with a little more attention to topics that we think are especially relevant to entrepreneurs. Join us. Thank you everybody.
Vivek: Thank you.
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