On this special segment of The Full Ratchet, the following Investors are featured:
- Phin Upham
- Gregory Ho
- Oren Yunger
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.
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On today’s special segment, we have Finn Upham of Haymaker Finn what is the best question an LP has asked you. I
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think that I remember I was once on a call, and I, this is a bit of a name drop, but like I was at a call when I was looking at SpaceX in 2009 I made it a small investment in SpaceX. I was lucky enough to be led into SpaceX, and one of the people on the call asked Elon a very simple question. They said, Elon, how am I going to get my money back in SpaceX? Because it seems like this crazy rocket ship company, right? And Elon’s answer was the best answer I’ve ever heard. He said, I don’t care if you get your money back. It doesn’t matter to me at all if you make money. I’m not doing this to make money or for you to make money. I’m doing this to get humans to Mars to change the world and to advance humanity. And if the only way I can do that. Mission is to make you money and to make myself money. I will begrudgingly do that, but it is certainly not my goal to make you money. And so the answer is, I don’t even understand the question of, how am I going to get my money back? The right question is, how is this company going to be an important company that changes and improves the world and makes a big difference to humanity? And then you can’t but by make but make money, and you will inadvertently make money if you pursue that. And I think that idea of these mission oriented, value oriented startups is something that was so important in early Silicon Valley and has sort of gotten eroded over time now, and I think is returning in the future as being us entrepreneur becomes harder. Do you think
1:59
SpaceX is one of the three most valuable companies in the world? In
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five years, I think SpaceX is already the most important company in the world. Whether or not it’s most valuable, I think Elon would say, Who cares? I Elon would have I don’t care if it’s valuable. Does it? Does it? Is it important? Does it change humanity? Does it accelerate our ability to be, to be a species that you know, does more with less, and you know, and then is multi planetary, and has more durability and has more ability to to to realize our full potential. And so, I think that you just asked, like, the question on the call, the the the the question that SpaceX is not trying to answer. SpaceX is not trying to be more valuable. SpaceX is trying to be more impactful, and that’s
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but it is a byproduct of it. I think
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that’s right. I think in the best of cases, you have an alignment between mission and value, and the more that mission is impacted, the more value is and in the appropriate regulatory regime for governments, you align mission to value, you have people work hard at their job to feed their family and make money, but the money is a byproduct. Like, you don’t you work to make money. But even better, you work at a job you love and you’re really good at and then you make money, and you feed your family too. Like, there’s these better versions, right? Like, you don’t work at a job you hate to make money. That’s not a good outcome. You do something you love and you make money. And I mean, Max, sorry. R K Merton and a sociologist. It’s always confusing, because the father and the son were both economists, and they both went by two by like their first two initials. It’s very confusing, but So either I think it’s R K, I think it’s R K Merton, he had this essay on deviance. It was very interesting essay on deviance. And he said that, like criminality in a society is deviance. That is deviant when a society has failed to provide you a way to comply the society’s rules and succeed. That is what environment in which a lot of people become criminals because they don’t see a legitimate path to success, they will do an illegitimate path to success. So it’s less of a normative or moral version of criminality and more of an economic version of criminality that is a well functioning society provides people past success that is also satisfying, that is also mission oriented, that also benefits everybody. And a dysfunction in society only allows past success, which are criminality and hurting other people while helping yourself. That is zero sum versus the pie getting bigger. And so I kind of Yes, I kind of think that, like, the right answer here is we want a society where being happy and being rich and being busy and being productive are all the same thing, right? They’re all they’re all aligned. That’s the society we want to be
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in. Aunt. Today’s special segment, we have Gregory ho of Spring Mountain, capital, Greg what is the best question an LP has
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asked you? Well, there’s always a sweeper questions which you should ask and so, and I think one sweeper question is, look me in the face and. Tell me what keeps you up at night, right? What keeps you in now this one of questions we ask because we’d like to see how one responds and this and say nothing. So you’re telling me there’s no risk right now. That indicates you don’t understand risk. But what keeps you up at night is, is, I think, always a great question, and the ability to understand the answer is drilled down between behind what you hear, to your evaluation of the person, and the idea is very important. But that’s that that I think one should ask, What? What keeps you up at nice or or what haven’t I asked you, what keeps you up at night? Greg, oh, my answer to the question said, at this point, nothing keeps me up at night. But that’s not because there’s no risk. The My job is to see all the risks that I can identify, and I’m fairly confident with me and my team that we’ve done that. But what you have to understand, if you’re humble, is that you understand only this much of the world after that, and there’s that much rest of the world that can kill your deal, and all those other things that you didn’t see will kill your deal. Yep, right. So why do you sleep well? Because if that kept you up at night, the uncertainty, then you shouldn’t be an investor. There’s always uncertain. You should accept that what you have to do is be mentally and physically healthy to confront those problems when they occur. So I go to sleep feeling I did my job right, and is my responsibility to go to bed, because tomorrow, when I wake up, and particularly this time tomorrow, when you wake up, geopolitical issue might have happened. Somebody might get elected and the world begins to unravel. Inflation might pop up and so forth. And you got to be able to go and deal with it with a positive, healthy attitude. So I if I’m not tired, that means I even have, haven’t worked hard enough, or I haven’t exercised hard enough. So every night, I go to sleep, but it’s not because there’s no issues.
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On today’s special segment we have Oren younger, of notable capital. Oren, what’s the best question an LP has asked you?
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So a question that that really stuck with me. I was an LP when they asked me to rank from best to worst, where, where I shine, whether it’s finding, picking or winning companies, that was a tough one. I’m happy to if, if of interest. Happy to share how I I think about that,
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please.
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What’s the answer? I don’t know if it’s the right or wrong answer, and time will tell. But you know, my background in the infrastructure that I helped put together helped me with with the three but just to answer the question, I think I’m best at picking companies. I think I can see things that others sometimes can’t or take more time to and since I can move fast and the reputation is improving as an investor, you know, I’ve been doing this for for only six years, I can get better at winning. And you can say that I’m the worst at finding but that mechanism is is improving. And notable, we have we have a we have a system that we compare ourselves to over 20 cloud infrastructure investors that we respect, and we can see our coverage, and we can see if it’s improving in areas and GEOS that we care about.
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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.
