On this special segment of The Full Ratchet, the following Investors are featured:
- Ryan Delk
- Aaref Hilaly
- Somesh Dash
We asked guests to share the best question they’ve ever been asked by an allocator.
The host of The Full Ratchet is Nick Moran of New Stack Ventures, a venture capital firm committed to investing in founders outside of the Bay Area.
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You can learn more about New Stack Ventures by visiting our LinkedIn and Twitter.
Transcribed with AI:
0:18
Welcome back to TFR on today’s special segment, we ask guests to share the best question they’ve ever been asked by an allocator. Here’s the segment called Best LP question.
0:36
On today’s special segment, we have Ryan Delk of primer, what is the best question a VC has asked you, it’s a
0:41
good one. Someone recently asked me, let’s assume that primer, is there any path to where primer achieves all the goals that you’re talking about, from growth, you know, student enrollment, number of primers that are nationwide, but still fails in your mind, and if so, what would that? What would that look like? And I thought that was a that was a good question, one, because, I think helped them get inside my brain and how I think. But then two, it helped disambiguate a little bit between the, you know, all the, all the goals that are kind of useful to talk about when you think about scaling an organization, versus the the motivations that are behind that. And so for some people, those are, those are one in the same. For us, we’re, we’re probably, you know, this, this quite a bit more altruistic and motivated about this very specific type of future we want to create, certainly more than some random SaaS company. And so I thought that was quite a good question. Love it. And what was the answer? There’s plenty of organizations in education that have scaled very, very large through regulatory capture or the right lobbyist or knowing the right people to take to the Lakers game, to courtside seats to get the contract, or whatever. But the efficacy, they’re not really making an impact on students. And if, even if we were able to, I don’t think this is possible because of the way that the market we operate in works, but in a, in some, some world where, you know, we were able to scale to serve millions and millions of students, but when I looked at the, you know, the efficacy data and the outcome data, and we were, you know, barely better than 50th percentile. I would not consider that a success. And I would, I would, I would lose a lot of sleep over that. If that was the case,
2:09
it’s a good answer.
2:15
On today’s special segment, we have Arif hilali of Bain Capital ventures, what is the best question a founder or an investor has asked you? The
2:24
best question that this founder, who we just partnered with asked me that I thought was the right question is they asked me, What are your expectations and what’s your vision for the company? And what they didn’t ask, which is what founders usually ask is, well, what can you do for us? What I mean by that is that what founders often, particularly first time, founders often ask is, well, you know, how many customer introductions can you make, and how many recruits can you bring, and can you list tangibly, the specific, you know, connections you can make, or partnerships or things that you will do? For me, the reality is that at the end of working together, whatever that end is, whether it’s, you know, the company’s hugely successful and has gone public, or the company is hugely unsuccessful and it’s been gut wrenching, and now it’s winding up. Those things are never the things that founders care about at the end. The only thing they care about is, you know, did this person really help me, and Were they supportive? Did they understand my business? Did they push me in the right ways? Did they broaden my understanding of these complicated decisions that I had to make and help me make the right decision? Were they someone I wanted to call when I was really stumped on what I should do? That’s the only thing that matters at the end. But it’s very hard for founders when you’re setting out to understand that upfront. So I felt like these, these questions of, what are your expectations and what’s your vision for the company? I thought they were great questions, because to have that kind of close relationship that I’m talking about, that a founder walks away at the end going, Wow, that was great. And I’m grateful for that to have that you have to go in with a with a set, a common set of expectations around what you will get from each other. And I think as an investor, it’s really important to have a shared vision of what you’re building, because that’s kind of like your north star of what kind and that vision could change and evolve with the market and what have you. But if the investor doesn’t have a clear picture of what it is that you’re trying to achieve at the outset, it’s, you know, it’s just very hard for them to anchor to anything that they would say beyond generic remarks. So, so that’s why I feel like those were the best questions. Perfect.
4:33
On today’s special segment, we have Somesh dash of IVP. What is the best question a founder has asked
4:39
you? Well, I’ll give you the best and the most painful. So the best is probably it’s a very simple one. It’s a version of either what matters to you in this company. I always think about the Stanford Business School question of what matters to you and why. So what matters to you in this investment, if a founder asks me that, what they’re really trying to say is, why are you excited? Decided to invest, and what are the things that you care about the most, right? So that’s a good one. And I think the most painful one actually came from it’s a fun it’s a lot of story, but you know, Travis Kalanick, we had an opportunity to invest in an earlier route of Uber, and we didn’t, and we didn’t engage fully. We passed on valuation stupidly, and we were kind of going through a rationale. He sort of asked the question. He said, so you don’t believe fundamentally I’m going to hit these numbers that I am showing you. And I said, Well, you know, I was trying to rationalize it. And I said, Yeah, that’s that’s kind of it. And he said, Okay, like, that’s all you have to say. You don’t believe I’m going to do this. And then when we actually met him six months later, he said, Hey, I remember that conversation, and I’m going to show you what I said I was going to do, and then I’m going to do, and then I’m going to show you what I did, which is even better. So that was because there are certain founders I knew with him. You know, when I spent some time early on with Facebook, it is there are certain founders that are just built differently and the grit and determination to just push and do amazing things, whether they’re 25 or 75 they just have it. I was just hearing this morning the Dave Duffield, who has a new company, his sixth startup. I think he’s 85 to 90 something in that way. Whoa. I just think it’s so wonderful to be in an ecosystem where people like that, who clearly don’t need to do it for money or status or you go, are are just so selflessly giving to the field of entrepreneurship. I think it’s amazing.
6:27
That will conclude this installment of investor stories. If you’re enjoying the program and would like to see it continue, take a moment and leave a five star review in iTunes. Okay, that will wrap things up for today until next time over, prepare, Choose carefully and invest confidently. Thanks for joining me.
