The Full Ratchet (TFR): Venture Capital and Startup Investing Demystified

Scott Kupor of Andreessen Horowitz joins Nick to discuss Secrets of Sand Hill Road. In this episode, we cover:

  • When Marc and Ben first reached out to you about joining A16Z, you hesitated. Why?
  • "When Marc and Ben first started A16Z, they described a founder's leadership capability as "egomaniacal"... what do you think they mean by that and do you share this belief?
  • What are the key factors in determining if venture is appropriate for the new business and its founder?
  • How should one decide how much to raise?
  • Scenario I've heard all too often... founder goes out to raise their next round, they've more than doubled the business, hit major milestones but the offers are less than double that of the last round. Scott, can you talk us through the valuation mistakes you most often encounter?
  • Founder has started fundraising... the first step is to get their foot in the door. Talk us through the right and wrong way to get a meeting.
  • You mention the 5 pitch essentials in the book - can you talk us through each?
  • We've done an episode with Brad Feld where we went into detail on the Term Sheet... both Economics and Governance. I don't want to cover each term today but first, related to Economics, what's different now about the Economics terms or the negotiation than what you saw maybe five years ago?
  • Same question for Governance, what has changed and what are the key terms in focus?
  • Do you have any guidelines on how much of their business founders should sell in any given round?
  • So the next topic, we've all seen before, assuming you've been doing this long enough, but a founder is struggling to raise, has little capital left, and is scrambling to get creative. What are some of the more common mistakes and outcomes you see in this scenario?
  • Why should entrepreneurs care who the LPs are behind the VC fund that's investing?
  • We could spend hours discussing boards... any key items you'd like to highlight w/regards to boards?
  • Talk us through the acquisition process?
  • IPO process?
  • Great summary section where you talk about good VCs... can you recap your thoughts on what Good VCs do?

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Direct download: 192._Secrets_of_Sand_Hill_Road_Scott_Kupor.mp3
Category:general -- posted at: 12:00pm EDT