On this special segment of The Full Ratchet, the following Investors are featured:
- Ben Orthlieb of Blue Moon
- Jon Callaghan of True Ventures
- Eric Byunn of Centana Growth
Each investor highlights a situation where they decided not to invest, why they passed, and how it played out.
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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Transcribed with AI:
0:19
Welcome back to TFR on today’s special segment, we asked guests to discuss their anti portfolio, a startup investment that they passed on. Here’s the segment called Why I passed
0:35
on today’s special segment, we have Ben ORTLIEB from Blue Moon. Can you tell us a story about a startup that you passed on your anti portfolio.
0:43
The biggest one in the anti portfolio is perplexity. We met them the week that they were doing the raise. See 35 the 90 million raise, and it’s a question of price discipline. So we passed on price, and partially because we didn’t really have time to go deep into personality. Now, at the time, maybe it’s a rationalization. It was very early in the llms, and there was this whole talk about, are they commodity? But it still is far and away the biggest anti portfolio company, which, by the way, if we had invested alongside Merck, or our portfolio would be borderline legendary at this
1:30
point on today’s special segment, we have John Callahan of true. Tell us about your anti Portfolio A startup that you pass on.
1:38
There’s so many. If you look, if you’re doing this job right, I don’t worry. Well, of course, I worry. Of course, I wish I funded the ones that I will tell you about one in a second, so I’ll get there. But I worry about what we don’t see, and if we’re seeing something, and for some reason, we pass that on us. I wish we didn’t pass on the mega, mega winners, the one I’m going to tell you about stings. But we saw it, and there was a reason why we passed. And I can, I can have peace with that. Okay, so Uber, I know seed round, I use the product. I’d heard about it. I actually wrote a blog post about how amazing it was. This was when Garrett, so, so actually, I think there was a little before that when we heard about from Garrett, because we knew him, we loved him. And our conversation was like, Okay, great. This is cool. We want to do it. Do you want to be CEO? And he’s like, Oh no, no, there’s no CEO. By the way. My decision was wrong. We should have seed funded that company. Obviously, the data’s there. But one of our things is that we need to have, we need to have a leader, like, we need to have the person who’s really going to kind of be a part of this, you know, whole journey with us, right? And there was none at the time. This is before Travis showed up. And so when I look back at that, of course, it’s like, wow, that would have been life changing for everyone. I, by the way, ended up there through another way. We ended up having, having a piece of Uber early through another pathway, through the portfolio and things, and it worked out very well, but that was hard, and I think it’s, I think it’s still to this day, one of our things that we, you know, we need to have a protagonist. We need to have a visionary leader leading the charge. And at that point, it was a project, and it was a pretty cool one, but there was no leader. So anyway, that’s the truth, and there’s many others. And like I said, I worry about what we’re not seeing that that keeps me up at night.
3:41
On today’s special segment, we have Eric biun of santona growth. Eric, can you tell us about the anti portfolio, a startup that you passed on? First of
3:50
all, I will say, you know, this is an industry where there are so many great companies. There are so many great founders, and I learned in school, no investor gets it right 100% of the time. So we all have these huge anti portfolios, and I try, for my own mental sanity not to get too absorbed in that. But you know, you can look across them. You know, we’re dedicated and focused investors in FinTech. So, for instance, in the Challenger banking segment, you know, we looked at most of the players out there, and a few of them are successful, so they’re in our anti portfolio. What do you think you missed? We probably missed the ability of good execution to overcome, frankly, I think, has been proven out, you know, not the world’s most attractive segment of the market, as well as, you know, a lot of well funded competition, and despite all that strong execution and some good, thoughtful approaches, you know, managed to navigate through. A I would still argue narrow line to get through that and come out the other end in a really good way.
5:10
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.
