146. Investing in Rocket Ships Before they Take Off (Zach Coelius)

The Full Ratchet- Zach Coelius Triggit Angel List Syndicates

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Zach Coelius of joins Nick to discuss his unique approach to working with startups and how he quickly built one of the largest investment syndicates.  In the interview, Zach and I discuss:

  • His path to investing
  • The Biggest difference between entrepreneur Zach vs. the entrepreneur Zach invests in?
  • Best lesson from his startup, Triggit?
  • Right place, right time… how do you apply to investing?
  • Top 3 characteristics you look for in founders?
  • Great entrepreneur… bad idea/bad market… how do you proceed?
  • How about with founders that aren’t quite ready yet for funding?
  • How did you get your start on AL?
  • Strengths of Syndication Process?
  • Tell us about your visit to Krypto Labs in Abu Dhabi:  What were the major takeaways, thoughts on crypto & ICOs?
  • Early exits… do you take them when you get the option? At what amount/multiple do you take money off the table?
  • Lessons from poker that you apply to investing?


Guest Links:



*Please excuse any errors in the below transcript

Nick: #Zach Coelius is a four time entrepreneur turned tech investor and advisor. He’s invested in #Cruise Automation, #Branch Metrics, #HelloSign, #Mparticle #SkySafe and over two dozen other startups. And #Zach runs a large and active syndicate on #AngelList. #Zach, I’m a big fan of yours, thanks for coming on!

Zack: Oh yeah, thanks for having me! I’m, I’m a huge fan of yours. You guys, you do good work.

Nick: Thanks man, appreciate it. Alright! Can we kick of with sort of your, your path to venture and, and your path to becoming an investor?

Zack: Yeah! Yeah. So I’d like to say I’ve never had a real job. Started my first company when I was 16. That took me to four Olympics, and the adventure we had, about two dozen people working for us at the last games I did, which was in Greece. Sounds super fun, a great way to make a lot of money as a kid and travel all over the world and, you know, learn, learn how to actually hustle your way into making money. Taught me a lot of great lessons as an entrepreneur.

Nick: Were you an athlete? How, how did you get on that path?

Zack: No. So, we, we got into or, I, I sort of it was me but then it eventually became we, got into this sort of tickets and collectibles business at the Atlanta Olympics. That was my first games. And then partnered with my sister and we ended up and running it at Atlanta, Salt Lake City and eventually Athens. And that was, you know, make thousands of dollars a day, go to the olympics and, you know, have a good time. Which is, a lot of good business lessons came out of it. One of the most important being that, you know, you go to, every olympics basically has a very different dynamic, whether it’s in the collectibles market or in the tickets market, it’s every, it’s a, it’s a different market. And you have to kind of like go and evaluate sort of the lay of the land, figure out where you’re going to make your money and where the margin is. And because everyone is different, you know, you, I made a lot of money in pins, in the pins or collectibles, in the, in the Athens game or the Atlanta games. And then literally went to Sydney and that market was dead, dead, dead. Like nothing. And shifted over to tickets and, you know, was able to figure out a niche in the ticket business at the Sydney games. And, you know, it was awesome. But you have to be very quick on your feet because the whole thing basically unfolds in a 4 week period. And you have to really, you have to spend your time evaluating the opportunity before you jump. A lot of guys who, who operate at the olympics businesses, they just sort of have one tool in their toolshed. They show up at the games and some business, some games they make a lot of money and some games they, you know, they go broke. Whereas I kind of was much more about the flexibility of saying okay, where’s the money we made at this game, how do I, how do I hustle my way into, to, to getting it figured out.

Nick: Love it.

Zack: That was a good lesson for me as an entrepreneur.

Nick: So was that,

Zack: So,

Nick: this must have been before #Triggit then?

Zack: Yeah, oh yeah, that was back when I was a kid. But that kind of parlayed into buying up some old houses and fixing them up and selling them off during the property bubble back when I was in college. And then in 2002 my sister and I started the first online voter registration and absentee ballot startup. So it was a non profit that few trusts and some other people funded. So we helped about a quarter million college students across the country engage with the voting process. So a tech startup but as a non profit. But we built, you know, built a tech stack and operated on a deadline, raised, you know, we raised about half a million dollars total, you know. All of it, all of the stuff of a startup but as a non profit. And so we eventually re-ran that in 2002 and then in 2004 during our, our college years. Then I moved on to grad school and then basically watered up my car and drove up to Silicon Valley to, to try my luck at this crazy, crazy game.

Nick: Yeah, so walk us through that. How did things sort of

Zack: Yeah

Nick: progress with the early days of having a

Zack: Yeah

Nick: startup that’s venture funded and through the, the various iterations of that?

Zack: Yeah. So it is a crazy story. I, like I said, I showed up out here, didn’t know anybody, slept on my buddy’s couch for a month. Went to Burning Man, just sort of like dove into the deep end. And started crashing tech conferences to figure out kind of what to do. I was really looking for a job more than anything else, trying to, you know, find a job where I could learn a lot. So went to Demo and CTIA, the very beginning Web 2.0, the parties in the back of #Mike Arrington’s Atherton house for #TechCrunch. I mean, all this sort of stuff that makes Silicon Valley magical. I just sort of showed up and was like hey, I’m here! And, you know, nobody really likes the guy who’s looking for a job. You don’t really want him to run around saying I’m looking for a job because it’s kind of hard to socialize with somebody in that scenario. So I started telling people that I had this idea in adtech, which I sort of did. You know, in retrospect it was a terrible idea. But I did have an idea. And the next thing you know, people were like hey I can, I can fund that. You, you should start a company. So I called up my sister, who was hanging out down in Brazil at that time, and said hey, sounds like we might get a company, come on back. So she flew up here. And we just hustled our way in to raising a little bit of money and then a little more money and then a little more money. Before you know it, a year later we were venture funded and off, on our way to, you know, building an adtech company. But it was, you know, I had no idea what I was doing. I mean, in retrospect I was, I was a complete babe in the woods. But it was pretty magical. I mean, it was, you know, the timing was amazing. We got here in 2005, right, right when YouTube sold, right when people started to get really excited about tech starting to take off again. Right when VC funds were suddenly opening up their purse strings. It was just a ton of activity. A lot of great companies getting started. A lot of young, you know, companies that eventually have become worth billions of dollars were taking off. I mean, it was, it was a pretty magical time to, to come into Silicon Valley. And sort of hustle our way into #Triggit. And then, you know, spend a few years pivoting around trying to, to figure out how to make something work. And then we were one of the very first companies to sort of stumble into real time bidding, right when that started to emerge, when there was about 20 million impressions a day in global RTB inventory. Right now real time bidding is, you know, a dominant standard for, you know, internet media, you know, hundreds of billions of impressions a day are transacted over it. But at that time it was very nascent. And #Leyman Brothers crashed the world with the hell, we were lucky enough that we had just raised a million bucks from #Reid Hoffman and a bunch of other great angel investors. And we saw this RTB thing happening and said hey, let’s go for it, let’s jump on this and hope. If it takes off, becomes an industry standard, great, you know, we’ll win, and if it fails well, you know, we were dead anyway. And got lucky. It, it, it took off like a rocket and we just sort of hung on for that ride, all the way up until we sold the company in 2015.

Nick: Awesome. So, so you had a sale and then did you transition right into angel investing? Or when did you start making investments?

Zack: Yeah! Yeah. So, so we had a, we sold it in 2015 and I was lucky enough to be sort of set free immediately. We had an interesting transaction where #LinkedIn bought a big part of the company and then a financial buyer bought the, the remainder, sort of the leftovers. And I didn’t really want to be part of either of those teams and so was able to move off on my own. And I had been an advisor to a bunch of Silicon Valley companies for a long time. And one of the companies that I had been working with from the beginning was #Branch Metrics. I had helped them raise their seed. And then when the A came around, I had said hey, you know, can I have an allocation to put on #AngelList because the #AngelList syndicates had just started. So they gave me a 200K allocation into the Series A that #NEA was leading. I put it up on #AngelList and, you know, it was instantly gone. I mean, literally that allocation was filled. And I was like oh,

Nick: You got a, you got a syndicate the next day. Unbelievable.

Zack: Yeah! I mean, it was, it was amazing! And I, you know, it just sort of opened my eyes to the possibilities of using the syndicates and #AngelList as a platform to, to put capital to work and become a professional investor. And, and it was just pretty cool. So, so that, in 2015 I, I did some consulting and I took a big vacation and went on, you know, a trek in the Himalayas. But that year I did the syndicates. #Branch was my first deal. #Cruise Automation I think was my second or third deal. A company called #Entrupy, which does counterfeit detection technologies. A company called #OneSignal, which is a push notification platform. And a company called #Zeotap, which is a data monetization platform for, for telecoms. Did those deals and kind of just sort of fell in love with the job. Fell in love with working with startups, fell in love with doing deals, fell in love with just sort of being on a new, a new path. You know, venture investor, being a venture investor is very different than being an entrepreneur. So it was, it was really just fun to be early on the learning curve again and to be just learning new things every day, and that, I just fell in love with it.

Nick: I hear you loud and clear. So it, it sounds like a fairly broad set of, of startups you’ve invested in. Is there, is there a focus area? Is it based on stage or are there certain sectors or, or types of tech that you

Zack: Yeah

Nick: like to invest in?

Zack: Yeah. So I’m, I’m a generalist. I’m generally focused on B2B software, not just enterprise SaaS, not just sort of data companies, not just sort of any particular vertical B2B. I’m pretty broad. You know, I’ve got anti-drone technologies and I have digital signatures and autonomous cars and adtech. I mean, I’m, I’m happy to look around pretty broadly in that, in that sector. Stage, I’m not in love with earlier stage. I mean, I, occasionally with people who I have known for a really, really long time, I will invest in the guy and an idea. But I’m, I really prefer to wait until they’ve really kind of settled in on product market fit, and settled in on a product and they really have that first hint of smoke of having found kind of where that business is going to go. I’m, I’m pretty happy that of all the businesses that I’ve invested in, I think I only have one or two that have actually pivoted. So it, for me that’s a real sign that I did it right, this is it. We found the business and we invested in the business and then the hard part was building and scaling and developing that business. But it was we don’t, we hadn’t really established and settled in on what that business would be, who the customers would be, sort of, where that thing was going to go. That, that for me is, as an entrepreneur I, you know, in the early years of #Triggit, you know, we spent a lot of time where I would call up a customer and I would be like hey, you should use our technology, it’s awesome. And they would be like yeah, don’t call me anymore. Or we’d, you know, we’d, we’d call them up and we’d, they’d be like yeah cal me back in six months. And then towards the end of #Triggit, we basically helped build #Facebook’s Exchange and then became one of the, we were the leading retargeting platform on #Facebook. And it was just, it was just night and day. I mean, we’d call up people like #booking.com and we’d schedule an hour for a call with them. It would be like hey, here’s what we’re doing. They’d be like yeah, yeah, we know, send us a contract, we need to do retargeting at #Facebook and you’re the leader, let’s get it done.

Nick: Wow

Zack: And so being the market leader in a segment where the customers know what they need and they already, they need that problem solved and you’re the best provider of that solution, it’s just a magical place to be. And so for me, the hunt in startups is, is to find that magical place and then just start to scale that business once you get there. And so I really focus on finding those companies right when they get to that point of starting to take off. And it’s, that’s my, that’s my sweet spot.

Nick: Awesome. Well, I do want to sort of unpack a bunch of these experiences with #Triggit and how that’s informed sort of your investment approach, but before we jump into that, is, are there sort of valuation bookends and maybe a sweet spot that you usually find yourself investing at?

Zack: No. No, I’m, I’m, I have invested as early as a couple million dollar valuation and as late as a 500 million dollar valuation.

Nick: Wow. Okay.

Zack: I’m not, yeah, it’s, the stage is not as important to me as basically just the, that product market fit. You know, once and, you know, the size of the market, the size of the opportunity, the quality of the entrepreneur, you know. All of the, all of the normal standard, you know, VC bullshit applies as well. But for me it’s really that hunt for product market fit is what I’m really, I’m looking for more than anything else.

Nick: Got it. Awesome! Well, I know you’ve got some great stories from your experience. Maybe we’ll just jump right in. So, what’s the biggest difference between #Zach the entrepreneur and the entrepreneur that #Zach invests in?

Zack: I mean, I think at the end of the day, the great thing about entrepreneurs is that they’re all special flowers. Like they’re all unique people. They all have major flaws. They all have major advantages. They’re just, they’re all really different. You know, if I look across the entrepreneurs I work with, no one is the same. So I mean, I think I’m not looking as much for the pattern recognition of seeing people who are like me. And I’m really looking for people who can basically show me a new market, a new way, something new. And generally those people are a little bit weird. They’re, they’re kind of, they’re fixated on something. And you really want that wild haired person who comes wandering out of the woods who’s raving about the gold mine they found six days travel into the middle of the jungle.

Nick: They’ve,

Zack: You want that person who’s a little

Nick: They’ve got the secret, right?

Zack: Yeah. You, that to me is what I’m looking for, is people who, who find that. And so, yeah, the entrepreneurs are, you know, they’re, they’re all all little crazy. But that’s, I think I love that about them is that they, they, they, that, that craziness comes from truth. And they’re crazy because they see something that nobody else sees. And it, and eventually everyone will come around to what they see. But they’re out in front of the pack. They’re in front of everybody else. And that, that does make them a little weird because, you know, they are not consensus. But that’s what I’m excited about is I’m excited about non consensus thinking ideas and people for sure.

Nick: So let me put you on the spot. Let’s, let’s assume everything you know now in your current situation, new

Zack: Sure

Nick: entrepreneur moves to San Fransisco, is going to all the conferences,

Zack: Sure

Nick: and he’s founding a new adtech company

Zack: Yeah

Nick: Would you invest in

Zack: No

Nick: that original concept?

Zack: No way, no way, no way

Nick: and why?

Zack: Like I said, I mean, because I, I think this, this taught me, my experience at #Triggit taught me how that early period of iteration and searching for the gold mine is not the part of the business that I want to fund. Now there are people who are really good at it. There are people who can, you can , who can smell the entrepreneurs who are going to make it, and they are just, they are, there are investors who are, who are really, really effective analysts of people. I’m not that person. I really am, I want to fund #Zach when he finds the gold mine because then I can sit down and understand okay, here’s the product market fit, yes. Here’s the market, yes. Here’s the, the sort of structure of the business, oh okay we got some issues here because it’s built on #Facebook. Let’s think, think about how we’re going to build a business that will basically enable us to move away from #Facebook and establish a moat and differentiation. I look at these businesses that are built on platforms as being built on quick sand. Like that, everything can change. And when you build it, you can build a little one story shack on top of quick sand. But you can’t build, you know, a #Salesforce tower on top of quick sand. And so it’s, it’s important if you’re, if the goal is to get venture scale enterprise returns and the kind of valuations that come with that, you’ve got to build it on top of solid ground. And I can’t really evaluate the quality of the ground until we find that spot that we’re going to build the business. And so for me, you know, the lessons I’ve learned as an investor and as an entrepreneur really all come back to let’s try to figure out what it is that you’re building and how we’re going to build it and where it’s going to go and what those moats are, versus the hunt for where to start building. I’m not, I’m not as good as that, I don’t think, as an investor.

Nick: Yeah. Tell me little bit more about sort of having this exposure to #Facebook. So you became the, the primary leader of the Exchange there.

Zack: Yeah

Nick: But you were probably also subject to, you know, whatever they were deciding. Is that

Zack: You know, I have a scar that runs from one side of my belly to the other, where they basically just, they killed our business and stole it. You know, they saw how effective retargeting and dynamic creative retargeting was on #Facebook. And, you know, the product managers over there in the ads team said oh, hold it a second, so #Triggit works with #booking.com and #booking.com gives all of their consumer intent data to #Triggit and then #Triggit can use that to drive, you know, five, six, seven hundred percent roi performance for #booking, that’s pretty cool, we should do that. And so they basically built out, you know, dynamic creative and a set of APIs to enable those advertisers to basically do that directly on the #Facebook platform. And then they went to all of our customers with a spreadsheet or they said here’s what you get if you work with #Triggit and here’s what you get if you work directly with #Facebook. You need to basically plan on starting to work directly with #Facebook.

Nick: Dang

Zack: They, they killed our business. So, you know, we had #Walmart, #Best Buy, #Home Depot, #Trip Advisor, #booking.com, #Travelocity, #Ebay, #Netshoes. I mean, we had basically the vast majority of the biggest direct response travel and e-commerce advertisers in the world used us. And, you know, the problem is, is once you have that sort of success, if you’re built on top of a platform, you know, I think #Facebook intelligently realized that that was very strategic to their business. They needed that data to inform their ad targeting agent. And those were relationships where they really didn’t want to have an intermediary between us, between them and their coins. And they, the product managers over there said okay, let’s build, let’s basically build out what needs to be be built to take this business from these intermediaries, us and, you know, people like us, and, and bring it directly into #Facebook. And that’s what they did. And, you know, that was a, as an entrepreneur, that’s, that was a pretty rough place to be.

Nick: Brutal. Yeah, we’ve, I’ve written about that in the past. I think the post was called Channel Choke. But having

Zack: Mmhmm

Nick: you know, your entire business basically exposed through one channel and all of your

Zack: Yeah

Nick: revenue can be shut off, particularly by a major tech player, it’s,

Zack: Yep

Nick: it’s tough exposure to deal with. So, so was that kind of one of the biggest lessons from #Triggit? Or did you have some other kind of

Zack: Oh no, I mean, I spent, spent 10 years in the trenches. I mean, we, we could talk for the next 5 hours about lessons from #Triggit. You know, you, you learn, you learn about people, you learn about investors, you learn about, I mean, being a CEO is the hardest job in the world because it’s, it’s a rocket ship ride, assuming you get your rocket to light. I like to say that a lot of, a lot of Silicon Valley is a bunch of people standing around a rocket pad, and everybody sort of has a rocket attached to their back. And you’re watching, you know, everyone just trying to light their rocket. Every now and then you see one of your friends take off and poof suddenly one of your buddies who was your peer is, you know, now the founder of #Dropbox. And you’re like whoa! And then you look over and somebody else basically takes off and gets about a 100 feet in the air and rocket explodes and scatters apart everywhere. And you’re like oh that sucks. And then you look at your buddy who’s been standing there for 10 years trying to light his rocket. And there’s grass growing up through his toes and you know, you feel kind of bad for that guy. Then you look over at your buddy who lights his rocket and he just goes sideways for 10 years, never really lifts off, never really crashes, but just kind of like, you know, the nature of this business is finding that rocket ship ride. But the problem is, is that even once you get your rocket to light, which is hard enough as it is, you got to find that product market fit, you got to, you know, really figure out a way to take off, it becomes a rocket ship ride into the walls of your own incompetence as a CEO. So you run into every single thing that you don’t know how to do, you hit that wall at incredibly high speeds. You smear across the wall, everything breaks, and, you know, it feels like you’re going to lose everything. And you’ve got to figure out how to put it all back together again and get around it to the next wall of your incompetence. And it’s, you know, because the nature of these businesses is that they, they have the potential to scale very, very rapidly, you hit those walls at very high speeds. And, you know, that’s, it’s pretty painful. But if you’re a good learner, you can learn from those experiences and you can come out of it, hopefully you don’t hit that wall again just as hard. But, I mean, you look at #Elon Musk, I mean, one of the best entrepreneurs of our generation. I mean, both #Tesla and #SpaceX almost went out of business multiple times. And it’s not that they might not go out of business still multiple times. And so, you know, his walls of incompetence are substantially higher than, you know, the rest of us. But he still runs into them just as hard as we do. And he has to basically, you know, dig his way out of them and move on to the next, you know, the next wall. And you learn faster as an entrepreneur in that experience faster than anything else you could, any, there’s no way you could learn faster than that because it’s all about blood and tears and sorrow. And so it’s, you know, for any entrepreneur that’s been in the trenches, I think you learn a lot really fast. No question.

Nick: So, so tell me, you know, what you’re looking for in founders. Founders have the, they’ve got the matches, they got the rocket, they’re, they’re about to take off, you know. You’ve had experience as friends, colleagues, of entrepreneurs before they, they’ve taken off, and you’ve known them, you know,

Zack: Sure

Nick: after they’ve done very well. What are, what are some of those early things that, that you’re looking for?

Zack: You know, I mean, there’s, they’ve got to basically see where they’re headed. They’ve got to basically be like look I went into the wilderness and I found the gold mine. They’ve got to, like when the rocket starts to take off, usually entrepreneurs know. Like I knew the moment #Triggit started to take off, I knew it. Like I was like oh my god, we got it. And of the companies that I’ve worked with, you know, over the last going on 10 years now as an advisor and then, you know, over 3 years as an investor, when we get it we know. Like as an insider, like, you know, when, when #Kyle, when #Kyle, when I talked to #Kyle for the Series A of #Cruise, the thing that made me want to invest instantaneously was like that look on his face when he was like I think we got this. And I was like done, I’m in. Like because you can, I’ve seen that before. And I, there’s like a, there’s a difference between an entrepreneur who’s selling you on it and an entrepreneur who’s internally convinced that they’ve found it. And for me that search is really about basically that moment when the rockets starts to light. Because you know, if you watch a, a, rocket take off, the velocity increases over time, but for the first few seconds that rockets just sort of hovers on the pad, you can tell that it’s getting ready to take off. But it’s, it’s not gone yet. And you can still run over and grab on and be part of that ride. And the entrepreneurs in that moment, they see it. They’re like oh yeah, aha. They can feel the power of that engine. And they, they’re just like, there’s a shift from basically selling a vision to feeling the future, which is just super duper powerful. That for me, that’s everything. I’m, there, like the joy of finding that at #Triggit and the joy of finding that at the companies that I’ve worked with subsequently, it leads me to that search of that moment. Because it’s that’s the magic. And then, like I said, the entrepreneurs are all different. They’re al unique creatures and they all, they all have different insights and different, you know, strengths and weaknesses. And they’re all different. But they all, they all have found that rocket ship that moment. That’s, that’s what it’s all about.

Nick: Awesome. So, so what happens when you come across a great entrepreneur, brilliant, young mind but you feel like it’s a bad idea or, or maybe it’s a bad market. Maybe they’ve got some product market fit but you, you’ve got some concerns about, you know, the sector or the market, you know. How do you handle those?

Zack: Yeah. I mean, you know, I think one of the things that, the way I approach investing is that for me it’s not about basically sitting down and analysis. It’s, and when I, when I talk with the entrepreneurs it’s not about like them telling me everything and then me like you know scrunching up my brow or sharpening my pencil and doing the math. It’s, for me it’s about like sitting down with them and talking with them about where they’re going, trying to work with them and have ideas and be useful and add value and make connections. And for every entrepreneur I meet with, my goal is to, I want to come out of that meeting feeling like I have, they don’t think that that was just a waste of time and that they thought that it was a useful meeting. And, and then it may just be, maybe it’s just I have some feedback for an idea, maybe it’s I’m making an introduction, or maybe it’s because I invest. But like I always want to, I want them to feel like I added value. Because they’re giving me their time. Like when they come to me, that’s time that they, they don’t get to spend building their product. That’s time that they don’t get to spend, you know, talking to customers or hiring employees. They’ve lost that time. And I would like them to feel like they got something back from it. But I don’t want it to be just a complete, you know, time suck. Because I think if I could successfully do that as an investor and get a reputation of doing that as an investor, then entrepreneurs will want to come talk to me. And they’re going to want to spend their time with me. And the more time I can spend with entrepreneurs, the more I can find those few that have found it. That moment of magic. And so I’m just, I’m constantly trying to, to, to do that as much as possible. And, you know, a lot of times they’re not there yet. Like they haven’t found it yet, and they know it and I know it. but that doesn’t mean that they won’t get there. And a lot of these, you know, these folks have great ideas, and they’re, they’re, they’re going in the right direction and they’re working on big markets. And I really want to be helpful. I want to like hey, how can I be useful here? Maybe I’m not ready to invest but I can be useful and give you some of my time or give you some of my connections or just sort of be useful in this process. And then also like in, in response to the question, you know, sometimes they’re not going in the direction that I think is a good idea. And one of the things that, I wish had happened to me many times over the history #Triggit was I wish that fellow entrepreneurs would tell me the truth. They would have told me hey #Zach, this is a bad idea. Now a lot of times they did. Like, you know, a lot of people basically told me how dumb it was to basically build on top of #Facebook, you know. And I was dumb enough to think that I would just be able to jump off when the time came. But like I wish more people had been more aggressive about me telling how they actually felt about what it is that I’m doing. So one of the things I always try to do is be really candid with the entrepreneurs about what I think about their business and their market and the way they’re going. And often they don’t really like it when I do that. But, you know, it’s surprising how many of them come, of them come back six months or twelve months or a year later, and be like hey that was actually a really useful conversation, thank you for that. And that relationship is now much stronger because we have built, we have built that level of credibility with each other and we can, you know, we can speak the truth to each other more effectively. And it’s, I think it’s worth it. So, so yeah, when people have bad ideas, I think I try to tell them. And I tell them I’m the guy who when #Travis first started #Uber, he and I had this argument for a solid hour about whether or not he’d get to the taxi. And I told him dude this is great idea, I’d love it to happen, but the taxi was going to crush you. And it means so I don’t think I could be more wrong, ever, in, at, compared to that. So I’m the guy who said that. So doesn’t mean I’m right all the time. Like you have to put it, you know, a, a giant margin of error on my head, but you know, feedback is feedback and, and I try to be as useful as possible in, in delivering it. And hope to be, hope to be useful when I’m meeting with entrepreneurs.

Nick: Yeah. So, so on this point, if you, you’re talking with an entrepreneur that they’re not ready or you’re not ready to invest. I’ve had

Zack: Sure

Nick: a few of these lately, actually. It’s a, if you, a set of entrepreneurs that have

Zack: Yeah

Nick: a ton of the ingredients, you know, they’re, they’re poised for success and they’ve almost got it together but it’s not quite there, you know. How do you handle these

Zack: Yeah

Nick: Do you continue to advise? Do you stick around or

Zack: Yeah

Nick: what is, how does the relationship progress?

Zack: I like to be very honest about that and tell them look, here’s what I think, I think you’re poised for success, I think it’s going to take off but I don’t think you’ve solved this problem yet and this is what I’m looking for, this is what, this is to me what would make this an investable business. I actually just got off a phone call with one of the, the companies that I work with. And, you know, they, they, they are very much I think in that situation where I think they’re in going the right direction and, and they’re, they’ve, they’ve got a lot of traction but there’s, there’s a couple pieces to the business that are just not there yet for it be a giant business. And so like one of the things that I think differentiates entrepreneurs from the rest of the world is that if you, let’s say, let’s say we’re at dinner, right? You know, you and me and ten entrepreneurs. And we’re in a, a cafe . And there’s like a brick wall, big brick wall, you call it a two storeyed brick wall. The kind of entrepreneurs I like to invest in in general are the kind of entrepreneurs that I see successful are the ones that basically if, if, if we were to say hey guys, we got an exciting game we’re going to play tonight. Tonight we’re going to play the game of break through that brick wall. So you can use anything in this room, any tool, you can take apart anything, you can break anything you want, but you can only use basically the things that are in this room, and you got to figure out how to break through that brick wall. The entrepreneurs I like to invest in would get really excited about that. They’d be like oh shit, this is going to be fun! Like they would get, they would get, it would be totally cool for them to try to figure out how to break through a brick wall using the legs of a table. And, you know, one guy would figure out how to build a chisel. And one woman would be like hold on, these guys are idiots, and she’d go grab the fire extinguisher and turn it into a bomb and use that to blow up the wall. But they would all basically get excited about how to get through that wall. Those are the sort of entrepreneurs that I love. Those are the entrepreneurs that tend to succeed. But the thing about those people, and generally I’ve seen this over and over again, is that in order to break through walls, in order to basically like make your rocket light up, in order to have basically get to the places you want to get to, you have to be tremendously focused. Like you could, you have to basically make everything has to become subordinated to that one thing, that one goal, that one problem. You, you’ve got to be just a, you’ve got to be a spear to get through the wall.

Nick: Yeah

Zack: Because if you hit that basically as a, you know, a, a smushy blob, you’re just going to smear across it and forget about it. But the problem with being a spear is that you’re very focused. So you’re, it makes you get through the wall but you lose context. You lose situational awareness. And you, sometimes you lose, you lose the ability to recognize that if you just had just walked over 5 feet, you could just walk around the fucking wall. Like, you don’t have to break through that wall. And that, or you realize, you fail to realize that your spear is rotting on the back end because, you know, you hired the wrong employee and, and he’s stealing from you. Like, and so that lack of situational awareness, it comes with the best entrepreneurs and often leads to their downfalls. And we’ve seen this over and over again, some of the greatest entrepreneurs of our generation get fired from their jobs after they’ve built, you know, 60 billion dollar companies because they were so focused on continuing to grow the company and maybe they didn’t spend enough time basically working on, you know, making sure the company didn’t have some rot going on inside of it.

Nick: Sure

Zack: So part of my job is to provide that situational awareness, to provide that context, to sort of talk about sort of here’s what you’re not seeing, here’s how you need to think about this in a slightly different way. And, you know, I, I love to do that. I think that’s, that’s part of the fun part of my job is that that aha moment when I tell an entrepreneur something, when I can communicate something in a way they actually understand and they’re like oh. You know, one of my, one of my, I, one of my investors in the last, my last company, one of the smartest investors that I have ever worked with, and he has multiple billion dollar exits, like the guy is brilliant, genius. One of his weaknesses I think was he, he would tell me where the future was, he’d be like there’s a curve up there and you got to go right around the curve, but he could never really communicate why. And I always feel like, as an investor, my job is to not only tell you where the curve is going to be and how to basically prepare yourself for it but also explain it in a way that you the entrepreneur can understand. That aha moment is really what I’m looking for. So I, I really look at this business as, as part of the job is that, that communication process. And so every time I get to kind of practice that and work on that and sort of that’s my craft. How do I, how do I come up with stories that are basically that are, that people can understand, how do I use metaphors in ways that they can basically internalize those, how do I give them analogies that resonate? I enjoy that process. It’s fun.

Nick: Love it. Have you seen this, this documentary on HBO on #Warren Buffet by chance?

Zack: No, but I love #Warren Buffet, so I got to go watch that.

Nick: It’s good. Check it out! But at one point in the documentary, they, #Buffet’s talking and he says both he and #Bill Gates were given the opportunity to write one word on a sheet of paper that was most important to their success. And

Zack: Yeah

Nick: they both did it blind. And when they turned it over, it was the same, and said – focus.

Zack: Focus

Nick: It said ‘Focus’.

Zack: Yeah

Nick: Yeah. Cool!

Zack: Yeah

Nick: Okay. So, earlier, I want to touch on this, earlier you talked about sort of right place and right time. You know, how do you think about timing and, and situation and apply that to your investing?

Zack: You know, I don’t really think about it that way. I, I basically, I don’t know when the right time is going to be. I don’t believe in, you know, being able to time the market because that would mean I could predict the market. And if I could predict the market, I would be a very successful options trader. So I believe in just like the evidence. The evidence that this is the right time is that the business is working or starting to work. That, those first hints of smoke are starting to happen. And then we, there’s evidence that the thing, the, the planes are lighting and the rocket is lifting off. And it’s like oh yeah, this is it. I don’t think I can predict when that rocket’s going to take off. I think that’s part of the reason why I kind of wait for that moment to be taking off, is that I’ve just watched enough of these businesses where I’m like oh that one’s going to take off for sure. And it never went anywhere. And other businesses where I was like oh that business is fucked. And they just take off. And I’m like oh man, I saw that thing starting to take off, I should have go grabbed on. So it, for me, I think there’s a humility in, in knowing that I don’t know what the right time is. But I’m looking for evidence that, that the time is now.

Nick: That’s great. So, so #Zach, you talked a little bit about your, your start on #AngelList

Zack: Yeah

Nick: You syndicated #Branch Metrics and it was a round led by #NEA. Can you

Zack: Yeah

Nick: talk a little bit about how, you know, syndication has worked for you, how it’s played out, maybe strengths of the process?

Zack: Yeah! No, I mean, the, the syndicates have been amazing! I mean, when we, when I first started, you know, doing the 200K round, it was a, was a lot of work. I mean, you really had to find a deal where there was a strong venture, top chair venture fund leading the round. You know, social proof is, is incredibly important on #AngelList. Like, you know, one of the things that angel investors on #AngelList are, you know, really, the, the advantages they have is to have tremendous access to liquidity, they can, or not in liquidity but in terms of the diversity of startups to invest in. And that diversity is, is pretty powerful for them. The disadvantage is that they don’t have a tremendous amount of access to information. They don’t get to meet the founders often. They don’t get to really do, you know, deep, deep dive diligence like you would if you were a, a direct investor or a VC fund.

Nick: Right

Zack: And so one of the things that they, they intelligently gravitate towards is social proof. So they’re like oh, you know, #NEA is leading this round or #Andreessen’s leading this round or #Greylock’s leading this round, I can trust that those investors have done the diligence. I can trust that this a round that, you know, that this is not a, it’s not a fraud, this is a real deal. So early on in my venture career, you know, finding that social proof really was what I needed in order to get a round done on #AngelList, even for 200K, which is sort of my minimum on the platform. And in the last 3 years, I mean, you know, my syndicate has gone from 250,000 in total backing to 10 times that. We’re coming up on 3 million here. So the scale has gone up quite a bit. But I think one of the other things that’s gone up that, that I really have enjoyed is that I’ve built, I’ve built trust with like a number of my backers because we’ve worked on a lot of deals together. They’ve seen my thinking. They’ve seen, you know, of the deals that we did in 2015 and 16, all but one of them have now marked up. So I think that’s like 11 or 12 markups and the subsequent financings done by great venture investors. You know, on paper we’re up 2x. We had the #Cruise exit. You know, #Branch is on it’s way to be worth millions of dollars. Like there, we, they’ve built, they’ve, we built trust together. And, you know, we now, you know, there’a thousand people who invest with me. And there’s probably a couple hundred of them who I, you know, can talk to or I exchange emails with on a, on a relatively frequent basis. We’ve, we can now basically look at a deal where we don’t have that social proof, where, you know, it’s a smart team and there’s, there’s, there’s a real, there’s real traction in this thing. It’s about to take off. And, you know, my guys and, and a few women, it’s almost men, which is very strange like I would say 90% of my investors are men, will, will step up and, and we’ve done checks now over a million dollars into some of these early stage startups. That is a tremendously powerful thing. Like I, like to talk about a rocket taking off, like #AngelList itself is a rocket taking off.

Nick: Yep

Zack: And being able to be on top of that platform and watch that happening and to see that in real life is a, a pretty amazing thing. It’s been really, it’s been really informative. And then the great thing is this like not only, not only is it capital but they also are, these are some smart guys. I mean, there’s, one of my backers runs a, a, a conglomerate that has over 5 billion dollars in annual revenue. I mean, check that out. Like how cool, this guy has built businesses worth billions and billions and billions of dollars. And like he exchanges emails with me about the startups that I’m looking at and the ideas I have. Like talk about, I mean, that’s, that’s cool! I mean, I’ve got lawyers, great lawyers on there. I’ve got aviation experts and, and tons of people who are like literally big shot AI folks. The guy who runs the CIO for one of the biggest credit card companies in the world backs my syndicate. #Eric Reese who’s like the guru of startups is on there. I mean, like the head of product at #Instagram, #Kevin Weil, is on there. I mean, so I have this like brain trust that is there giving me feedback, helping me diligence my deals, telling me when I miss stuff. I mean, I’ve done a couple of deals that in retrospect maybe weren’t the best deals. And like the feedback I got was amazing. I mean, it was like people were uncovering all sorts of holes in these businesses that I didn’t see when I had my original work. And so, you know, there is a, the wisdom of, of a smart crowd, I’m not really a believer in sort of a wisdom of the crowds generally, but the wisdom of a smart crowd is a super powerful tool. And so I’ve, I’ve just, I’ve just felt tremendously lucky to have these folks, you know, working with me on building this, you know, this, this business. It’s, it’s a pretty awesome thing. I’m, I, every day I’m kind of surprised at how, how lucky I am to be able to do this.

Nick: I couldn’t agree more. And, you know, there’s a nice parallel in the social proof in that, you know, if you got some of these big lead investors that kind of helps attract more people but over time, you know, the backers see the quality of the deals you’re doing, they see all the markups and then you as the syndicate leader become sort of the social proof. And if you’re investing, I mean, we’ve got 15 to 20 investors that come along, and in almost every deal they sort of believe in our process. So, and we’ve been fortunate too that all of our deals except for a deal that’s only two months old have, have been marked up as well. So,

Zack: That’s awesome.

Nick: you know, we’ve been lucky I’m sure, but it’s nice to have this, this pool of people that, that have faith and have trust and have already made some money and it’s, it’s a good system.

Zack: Yeah. Absolutely. And it’s great. I mean, they can, they can sit on top of your deals and my deals and, you know, all of the other great investors on the platform. And they can, I think one of the things that a lot of people don’t appreciate is that, you know, they can pick and they can use their own intelligence to choose the deals that fit in their thesis and their strategy and kind of what they’re looking for. And so it’s, you know, compared to being an LP in a venture fund where you kind of alone for the ride, you know, and you’re, you don’t really get to add value, you know, the syndicate model does create a pretty tremendous opportunity for these folks who are really smart, really smart, to, to be participants in the process. You know, and, to be honest, like how cool would it have been to, you know, be able to sit at Thanksgiving dinner and be like yeah, you know, I just invested in a company, we sold it for a billion dollars. I mean, that’s a pretty cool thing. I actually know I’ve bragged my fair share about having been able to do that. So for all my backers who also took the leap of faith to, you know, to, to make that initial investment in, in #Cruise, you know, they, that’s, that’s pretty cool. It’s, it’s not often that you get to do that. So there’s, there’s a lot of I think of this type of investing compared to, you know, just tossing it into an index fund or, you know, being an LP in a venture fund.

Nick: Yeah. Totally. So #Zach, I want your kind of personal take on something. So I’ve only been doing this for 4 years, but recently we had sort of our first opportunity to take an early exit, right. So a series A investor was coming in, and they wanted to buy us out of our ownership. Have you had experience already with early exit opportunities before, you know, a standard liquidity event like an IPO or a, or a strategic sale? And how do you kind of look at those and, and judge whether you want to let it all ride or, or liquidate a certain portion of the investment?

Zack: Yeah. I mean, so to go back to the rocket analogy, and I think this is true for startups, the real value gets built as the company develops velocity and speed. So if you look at a rocket when it first takes off, it’s not going all that fast. The real velocity happens very late in the life of that launch at sort of, at the apex of that launch. And I, I just don’t believe that I can time an apex. But when I see a rocket taking off, my goal is to just grab on and hold on and not let go. And just ride it as long and as far as it will take me. I’ve made the mistake of selling early multiple times. And I just don’t intend to do that anymore. So I don’t, I don’t sell. I, I just, if I, if I believe in the rocket, and I believe that it’s taking off, you know, I’m happy to, to be along for that ride and, you know, for all, I, so far I have not yet, I have not yet happened into a company where I’ve lost that faith and where I’ve, you know, I feel that, that it’s not, I, I can imagine doing it if I maybe I thought the entrepreneur was unethical or if I felt I had some real solid conviction that the business was about to die. You know, I can imagine maybe then there exiting. But generally, no, I’m, I’m along for the ride. Because the real money gets made at the later stages of the company in year 8, year 9, year 10, like way out at the end. That’s where the real money gets made. So I, I really intend to, to, to stick with my companies and, and keep investing. I mean, one of the, one of the, the things that I’ve been lucky about over the last year is I now have a, a big LP who will write multi million dollar checks into my later stage opportunities. And so we’ve actually taken, we’ve led, we’ve led the, the #HelloSign series B, which I had been an advisor there from the beginning.

Nick: Wow, nice!

Zach: And wrote a big check into that, led it with #Foundry. And then we, you know, we invested in a couple other companies that haven’t been announced yet that were major investments. So that’s cool. I get to keep doubling down and putting more capital to work. And I don’t intend to, I don’t intend to sell my positions. I’m, I’m, I’m here, I’m here until they become liquid and then I’m forced to sell them because of the nature of the syndicate model. But until then I’m, I’m not looking to get out.

Nick: Good for you, man. I mean, in an industry where a lot of people say you can’t pick, clearly there are people that, that pick better than others. There are firms that do better than others. And

Zack: Yeah

Nick: you know, I’m

Zack: I don’t believe that for a second. Anyone who says you can’t pick is an idiot. Like that’s just not true. Like you look at #Mike Morris, you look at, you know, well let’s say well I mean, #Sacca, I mean, unbelievable picking

Nick: Yeah

Zack: done over there

Nick: #Esther Dyson, #Ron Conway

Zack: You can look at, you can look at #Mamoon. I mean, I mean, jesus look, if you go, you go into #Mamoon’s LinkedIn and look at the companies that he’s invested in, you can’t tell him with a straight face that people can’t pick. And I will call you an idiot to your face.

Nick: Yeah, #Mamoon’s amazing.

Zack: Like there’s real pickers in this business, there’s alpha in this business. No question.

Nick: Yeah. And, I mean, you’ve got a limited track record but clearly, you know, you’ve, you’ve done pretty well picking. So I’ll

Zack: Yeah

Nick: pat you on the back

Zack: it’s early for me. I’m, I’m not

Nick: Early day

Zack: I’m not anywhere close to that category. But, no, dumb luck has been my friend and I’m enjoying the ride. So I’m going to go for as long as I can.

Nick: Alright! So speaking of, of dumb luck, I know that you play in, in a poker game

Zack: Yeah

Nick: out in the Bay area, with, with some notable people over, over time. Right? Some, some founders

Zack: Yeah

Nick: of, of a variety of different startups. Can you talk

Zack: Yeah

Nick: a little bit about your game. I’m, I’m a poker player. I play in a game every week, have been for many years. But tell, tell us a little bit about your game and maybe lessons that you’ve learned that, that you apply to investing?

Zack: Yeah. So I, I started playing poker shortly before I moved to Silicon Valley. And then when I moved out here, I, I sort of jumped into it as much time as I could spend on it. And at my, at my peak I was playing, playing 4, 3-4 nights a week. You know, and for me it, in the early years of #Triggit, it was a great place to sort of relieve, relieve stress because when you’re playing poker you can’t think about your business, you just, you have to focus or you get your ass kicked. And so that enabled me to really just sort of like, like have an escape from the brutality of being a startup entrepreneur. And yeah, over the years I’ve been lucky, you know, there’s a game that you see run by the, the late great #Dave Goldberg. The game still runs but #Dave Goldberg used to be sort of the, the hero of that game down in the, in the Valley. So the, you know, #Phil Hellmuth plays in that game, #Chamath and a bunch of other, you know, great folks.

Nick: Wow

Zack: That’s, that’s been fun to be part of that. You know, sit next to #Dave Sachs to see he’s kind of like talking through the craziness of #Yammer, and like sit next to #Bill Gurley as, as the #Uber stuff is going on, you’re, you know,

Nick: Wow

Zack: #Jason as he’s as he’s talking his giant game as #Jason always does. That was pretty cool. You know, being able to, to, you know, sit down. I mean, there was a game that basically the #YC kids used to, to have and, you know, #Drew from #Dropbox used to play in that game on a regular basis, and a bunch of other great, the #AirbnB guys were there right when it was still the earliest days in #Airbnb. And, you know, being able to see those businesses as they were starting to get started at the poker table was, was really cool. You learn a lot when you see people in those situations and see how they respond to the dynamics that are poker. But yeah the games taught me a ton about, you know, understanding people, understanding the, just the, the brutality of probabilities. You know, you can have everything right and you can still lose. You, you know, learning to deal with the swings of life and the swings of the game is, there’s no way to basically learn to get used to feeling pain and to get your ass kicked in poker over and over again. And you go back to your spreadsheet and you look at it and you see that it’s going up into the right even though you’ve just lost an insane amount of money in a  period of time. And you can, you have to learn to do that if you want to be successful in this business. Because the game is, this is a business of tech investing and tech startuping is such a crazy non-linear game. So yeah, poker has taught me a tremendous amount. It’s a, it’s a fun game. I love it.

Nick: Yeah. After a few years of playing against that type of competition, are you up, do you know?

Zack: Oh yeah. Yeah. No, I, I, I’ve paid the bills of #Triggit in the early years playing poker. Poker has been very good to me. It’s yeah, I mean, the, though I did get to the point where I was playing with, you know, one of my, one of my good friends who’s a PM at #Airbnb, Almer, I think got 50 at the world series, and, and there’s a, one of the guys who was at the final table a couple years ago, #Neil of the main event, played in our game. And we had a, a buddy who passed away who was, you know, probably better of those guys who played at our game. I did get to the point where I saw the, my, my skill was not anywhere close to their skill. I, I saw the top of the mountain and, and that was not me. But yeah, it’s been good to me. Poker’s been a good, good game.

Nick: Next time you’re in Chicago, give me a shout and we’d love to

Zack: Yeah!

Nick: have you at the game.

Zack: That would be fun! Yeah.

Nick: So, #Zach, I was

Zack: That would be great.

Nick: I was checking out you #Twitter feed and I saw that you were at the Abu Dhabi event that #Krypto Labs held.

Zack: Yep

Nick: I want to get your take on, you know, how was the event, any major takeaways and sort of overall thoughts on #Krypto and, and ICOs.

Zack: So, #Krypto Labs is not actually a #Krypto Lab. They just named it #Krypto Lab but it’s actually a startup incubator accelerator and co-working space in Abu Dhabi.

Nick: Yep

Zack: But it’s not, its not only #Krypto. But yeah, super cool! I mean, it’s, I’ve travelled all over the world meeting with entrepreneurs and you know like Silicon Valley is the hub, but the spokes go long and far and there’s real cool stuff happening all over the world. So I, I want to do more of that. I want to invest in more companies that are not in Silicon Valley. I want to be out, out there on the edges because I think that’s where real innovation happens. And part of those edges are not just edges of ideas but also edges of, of space and time. So yeah, it was great to be in Abu Dhabi. And there’s actually, they have this amazing education company that, that is part of that team, that is doing some really cool stuff that I’m excited about in Abu Dhabi. So yeah, that was, that was a great event and, you know, nothing like flying 15 hours for a weekend. But it was, it was really cool. In terms of #Krypto stuff, it’s a comparative question, I’m generally pretty bearish. You know, I believe that basically when the real, the next liquidity event happens, a liquidity event happens, the next crash that, you know, will happen when it happens in, in our macro markets. You know, I think basically people will liquidate their #Krypto because there is no real fundamental tie to value. I think that creates this magical bubble mentality if it goes up. So more people buy it. So it goes up more. So more people buy it. Like that’s why it’s, you know, because it doesn’t have an inherent sort of value that you can put on it, it’s, it’s created this, you know, wonderful bubble dynamic. But I think that when the real liquidity crunch happens and people have to, you know, pay their mortgages and they have to meet their margin calls and, you know, the, the same dynamic happens in a direction, more sellers link with more sellers link with more sellers link with more sellers. And will drive it all the way to the bottom. You know, what happens then I don’t know. That, that will be interesting to me is if like if I’m a buyer when #Krypto goes down 90%. But, but I’m, I’m on record as being bearish on, on #Krypto. In terms of ICOs, I’m even more skeptical. I think I’ve spent a lot of time with startups and no startup ever ends up where we think it will. And these ICOs basically people are buying coins, predicated on the idea that the startup is not only going to go in a straight line become big and meaningful but they’re going to do it in the way that we all were planning on it happening. So it’s like okay we’re going to buy this attention coin with the expectation that the company won’t pivot or change course for a wall between and there. And like I think that’s just crazy. Like these startups all change. And so like these coins that are predicated on no change and success, I think are, are, are highly, highly problematic. So I’m, I’m not along ICOs, I’m, I’m very, very skeptical.

Nick: Dangerous assumptions there.

Zack: Yeah. It’s just no startup ever goes in a straight line and like lives up to it’s plan. No startup. That just never happens. And these, these ICOs are predicated on not only the company succeeding, that’s one risk, but also in order for the coin to valuable, they need to actually do what they say they’re going do and that they’re planning on doing today with no changes to make the coin actually useful in the economic value of the business when it gets to that point somewhere in the, the distant future. But no startup ever basically follows a straight line. So like, you know, I think #Justin Kan over at #YC has a, a great, a great line. You should never do two hard things. So yes, you can invest in a business with the hope that it succeeds, that’s hard, but also basically expecting the business to do exactly what they’re going to say they do today tomorrow. That’s also hard. Those two hard things means it like I think it’s just a very foolhardy thing to do.

Nick: #Zach, if we could address any topic here on the program, what topic should be addressed and who would you like to hear speak about it?

Zack: I don’t know. I mean, this is a hard job, right. Like, you know, it’s  there’s so much to learn. So, you know, so many great investors out there. #Salil at #Bain, #Mamoon over at #KP, you know, obviously more, it’s and, you know, guys who I really look up to. Just them get on and, and let them teach me new things. Like things I haven’t thought about. That’s, that’s what I would be most excited about.

Nick: Awesome. And just to wrap up here, what’s the best way for listeners to connect with you?

Zack: #LinkedIn. I use #LinkedIn every day all day. Feel free to send me a direct message or mail on that. I read all those, I don’t connect with people unless I know them, but I will definitely message with you. So feel free to send me a, a note. And I’m excited to, to, to connect with your, your listeners.

Nick: Awesome. Well, #Zach, this has been a huge pleasure. I appreciate you carving out the time and look forward to the next one.

Zack: Awesome! Thank you! It was a real pleasure.