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

Lo Toney of Plexo Capital joins Nick to discuss Common Traits Shared by Top GPs, Why Underrepresented Fund Managers Will Produce Superior Returns, and SPACs vs. Direct Listings vs. IPOs. In this episode, we cover:

  • Walk us through your background and path to VC?
  • Why are Product Management skills similar to the skills required for VC?
  • What's the thesis at Plexo Capital?
  • Do you think a thesis on investing in underrepresented founders will produce superior returns?
  • What do you say to pundits that claim you've restricted your options and will have far fewer managers to choose from... which will adversely impact returns?
  • On a percentage basis... will there be more outsided outcomes from diverse founders (or managers) vs. those that are not diverse?
  • How are you innovating on the LP side?
  • We talked about some of the challenges of raising funds... are there ways that you work with and help emerging managers raising a first-time fund?
  • Not just about performance... especially early on.  What are the common success traits you see in GPs?
  • What's your position on investing in the management company or even the GP itself?
  • Where do you see the market for secondaries evolving?
  • I'd like to talk about the exit market a bit...
  • What are your thoughts on companies listing direct?
  • How about the explosion of SPACs -- net positive or negative for venture?
  • Any unintended consequences that founders (or investors) need to watch out for?
  • Zoom is now worth more than Uber, Airbnb, and Stripe combined... Are the three companies undervalued or is Zoom overvalued... or is the pricing about right?
  • Amazing to see companies like Paypal and Square have surpassed Goldman in market cap
  • "3 Data Points"...
  • You’re approached by a first-time fund manager.  The fund manager did not work for a large, brand-name venture firm before and she has never had an institutional investor.  She has been actively investing for 3+ years.  She plans to raise $20M to invest in 30 seed-stage companies w/ no reserves.  The catch is you can only ask 3 questions (for 3 additional data points) to make your decision.
  • What 3 questions do you ask? 
Direct download: TFR249.mp3
Category:general -- posted at: 6:00am EDT