Tag: superclusters

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The 3 Big Family Office Transitions That No One Talks About | JD Montgomery Pt 2 | Superclusters | S7E4

jd montgomery

“To whom much is given, much is expected.” — JD Montgomery

JD Montgomery leads the Family Office division at Canterbury Consulting and is a seasoned advisor with nearly four decades of experience serving prominent families with a focus on strategy, organization and measurement. Based in Newport Beach, he serves a select group of multi-generational families and helps them navigate the complexities of wealth, purpose, and legacy. Mr. Montgomery partners with his clients to help them optimize the allocation of their resources across generations. Over the years, Mr. Montgomery has developed a deep network of relationships in the venture capital industry. He has helped his clients gain meaningful exposure to venture funds and direct investments and develop relationships with leading innovators and investors globally. He is a Managing Director, shareholder, and board member at Canterbury Consulting. He graduated from Stanford University and holds the Chartered Alternative Investment Analyst (CAIA) designation.

You can find JD on his socials here:
LinkedIn: https://www.linkedin.com/in/jd-montgomery-6161341b/

And in case, you’re curious about my reactions during and after recording that episode, you can find my thoughts here on Superclusters After Hours.

You can also find Part 1 of JD Montgomery here.

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

(00:00) Intro
(02:00) The definition of family offices
(03:01) Generation 1 vs 2
(06:25) Building a family office at Gen 1
(07:48) The 3 considerations for succession planning
(11:14) The “why” of succession planning
(12:59) Building self-esteem in children
(17:14) How do you help children choose their long-term passions?
(20:16) When should next gen of family offices know how rich they are?
(23:35) How do next gen family office members first get exposure to VC?
(32:25) When do you give next gens influence over the family’s capital?
(35:28) What % of the family capital should you give a next gen?
(37:42) The ask
(38:09) The hard and soft issues of wealth
(42:41) How often do next gens inherit their parents’ support system?
(46:35) How does a GP know how sophisticated an FO is?
(53:43) How does an advisor know an FO’s sophistication?
(59:10) Sophisticated simplicity
(59:50) When’s the last time JD’s OS changed?
(1:05:23) Post-credit scene: Time is a construct

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“[A family office] is a living, breathing organism that is built around people—a family—that’s there to serve them to accomplish their missions.” — JD Montgomery

“There are three considerations: When do I give the next generation visibility? When do I show them all of the zeros? Secondly, when do I give them influence? And lastly, when do I give them control?” — JD Montgomery

“To whom much is given, much is expected.” — JD Montgomery

“It’s impossible to wealth-transfer self esteem. There is some level of wealth that allows next gen to be able to do anything, and there is some level of wealth that allows the next generation to do nothing.” — JD Montgomery

“I don’t want to belong to any club that would accept me as a member.” — Groucho Marx

“I don’t view venture as an asset class. I view it as a methodology to allocate capital to every sector on the planet that’s changing. And oh, by the way, every sector on the planet is changing right now.” — JD Montgomery

“I call it the hard and soft issues of wealth. The hard issues are tax and legal and the economic side. The soft issues really relate to people. Is this individual mature in the development? Have they launched? Are they ready to be a good steward?” — JD Montgomery

“We do surgery with chainsaws, and just hire people to clean up blood.” — JD Montgomery

“Time is something man invented to be able to coordinate action. It doesn’t exist otherwise.” — JD Montgomery citing something a Navy Seal once taught him

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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Who Should NEVER Start a VC Fund? | Sam Huleatt | Superclusters | S7E3

sam huleatt

“Lower barriers to entry doesn’t mean higher probabilities of success.” — Sam Huleatt

Sam Huleatt is the co-founder of The Side Letter, a platform driving network-based research for capital allocators. Prior to The Side Letter, he created and ran the The LP Institute at VC Lab, as well as let On Deck Angels at On Deck. Moreover, he’s a serial founder, active angel investor in over 35 companies, and an active allocator in emerging fund managers, including the likes of Notation Capital, Orange Fund, Inuka Capital, Asylum Capital, and more.

You can find Sam on his socials here:
LinkedIn: https://www.linkedin.com/in/samhuleatt/
X / Twitter: https://x.com/samhuleatt

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[01:34] Sam’s childhood
[03:24] The most persistent myth about Sam he never bothered to correct
[05:47] Bottom-up vs top-down investor
[13:37] Can career VCs develop empathy for the founder?
[18:43] Traits of someone who should definitely start a fund
[26:45] Traits of someone who should NEVER start a fund
[28:09] Air of inevitability
[33:44] Why was Outlander VC inevitable?
[36:11] Where should 60% of your Fund I capital come from?
[41:47] Starting a VC fund is hard
[44:46] Do LPs like GP accelerators?
[51:35] Top 3 considerations for first-time LPs
[58:03] How many GPs should 1st-time LPs meet?
[1:01:06] Governing law of VC: Adverse selection
[1:04:40] Incentive alignment on fees
[1:06:36] Terms in LPAs vs side letters
[1:11:16] What is The Side Letter?

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“A career VC has a lot more experience having been on boards. And because of that, because they’ve been a career VC, they’ve seen more companies operating at scale and the issues that come into play in those cases, whereas operators-turned-GPs often have a narrow aperture because they’ve spent most of their career at one or two companies. On the one hand, the operator-GP obviously has a lot of empathy for founders because they’ve been that founder, but they probably haven’t experienced all of the difficult issues that come up as companies scale across lots of different environments. Career VCs have.” — Sam Huleatt

“The best investors have an air of inevitability. It’s not asking for permission or doing something because it’s perceived to be high status.” — Sam Huleatt

“Lower barriers to entry doesn’t mean higher probabilities of success.” — Sam Huleatt

“Most people, after starting a fund, should assume that 60% of that Fund I—you should raise that from first-degree connections—people you already know. It may not be easy, but if you don’t have a network that’s large enough or has those resources, you either need to reconsider your fund target size or maybe you need to spend more time building your network before you start to go out and do that raise.” — Sam Huleatt

“If you don’t have an edge going into [a GP] accelerator, you’re certainly not going to find an edge in the accelerator.” — Sam Huleatt

“Why do the best GPs in the world want you to be on the cap table? A lot of people forget that a key aspect of venture is not just picking, but being picked. That’s true for LPs and it’s true for GPs.” — Sam Huleatt

If you somehow made it to the bottom of these show notes, I’m also trying a new experiment where I write my reactions to the episode on my second blog, Superclusters After Hours. For Sam’s episode, you can find my reactions here.

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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“I Write-Off Every Sourcing Slide” | Alex Felman | Superclusters | S7E2

alex felman

“The game you play as you’re building a reputation becomes a different game than when you have a reputation. And I tend to find, from an LP’s perspective, when you’re building reputation, that’s actually when you deliver the most value.” — Alex Felman

Alex Felman is an entrepreneurial and family office professional. For over 10 years, as a second-generation member, he has run his own family office, Felman Family Office, and works with family offices around the world through his family’s multifamily group, MSF Capital Advisors. Using his expertise in Molecular Toxicology and Bio-entrepreneurship (B.A from University of California -Berkeley, MBA from Copenhagen Business School), he advises them in biotechnology, healthcare, and other futuristic tech industries with the goal of maintaining long-term wealth through innovation. He regularly speaks at family office and private wealth events on topics such as tech investment, manager selection, generation and succession issues, rising generation trends, and more.

He has used his experience within the family office industry and 20 year background as an educator to create Exponential U, a family office education program designed to help families become multigenerationally sustainable. His proprietary L3 framework (Learn, Leverage, Legacy) allows the holistic development of family members to ensure a smooth leadership transition.

You can find Alex on his socials here:
LinkedIn: https://www.linkedin.com/in/alexwfelman/

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[04:36] The ‘tastemaker’ for family offices
[05:54] Exploration vs discipline
[08:15] The hero’s journey in investing
[09:49] The life line
[13:39] Building and having reputation
[16:06] Risk appetites for asset owners & allocators
[18:44] Why won’t an institution invest in me?
[19:50] The quiet thing LPs don’t talk about
[25:15] When did Alex get involved with his family office?
[29:09] Writing off sourcing slides
[35:33] Different flavors of “sourcing from YC”
[38:41] Emerging GPs are “investments-as-a-service”
[40:08] Fund power law is greater than startups’
[43:44] Emotional value of investing in funds
[44:45] Most VC funds are scams!
[50:01] Optimistic cynic
[51:43] Reminders today about the good ol’ days
[54:17] Late stage capitalism
[59:10] Post-credit scene: Dave Chappelle and podcasts

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“Every great conversation dances on the line of your understanding. You dance between both sides of the line and try to find out where what you know and what they know intersect and end. Good conversation is like play.” — Alex Felman

“With my background from the family offices, I almost believe that most family offices moving forward will need their own personal tastemaker or sommelier. Someone who’s curating the world specifically for the needs of that family.” — Alex Felman

“People get into trouble when they’re using the wrong tool or trying to do something for a different purpose. For example, I’m going to try to do discovery when I’m in my routine. Ok, you’re probably running into problems. Or routinizing my discovery. Those two things are in conflict with each other.” — Alex Felman

“One of the things people always forget—… What they remember from the hero’s journey is adventure, and we fight the dragon, and we get the treasure. But at the end of the hero’s journey, you’re supposed to bring that back to your community. And you’re supposed to forward it to your community. And you’re supposed to make your community better from the dragons and the treasure that you fight or find. Most people often leave off that last part. And I actually think that last part is extremely important.” — Alex Felman

“The game you play as you’re building a reputation becomes a different game than when you have a reputation. And I tend to find, from an LP’s perspective, when you’re building reputation, that’s actually when you deliver the most value.” — Alex Felman

“If you have a family office where you’ve actually outsourced it, your employee is more of an allocator than an owner. And in that case, that allocator is often making decisions to save their own job. Or to ensure that they continue to have a job.” — Alex Felman

“What I find is slightly sad is that ultimately because of security and comfort reasons, things like people’s pensions which should be more secure, are actually, in my opinion, taking riskier bets. And bets that will lead to worse outcomes.” — Alex Felman

“I believe that the amount of due diligence you do doesn’t matter depending on the deal size. So let’s say they’re writing five $100 million checks compared to 100 $5 million checks, that is literally 20 times the amount of work. So even if they’ll get a better return on that 100 $5 [million checks], on a realistic level, it forces them to play certain types of games.” — Alex Felman

“With at least funds on a standard two and twenty, somewhere around $75-100 million fund size is where the incentives shift from being carry-oriented to management-fee oriented. Once you get larger than that, then it actually becomes more incentivized for the fund managers to build up their funds than the actual returns itself.” — Alex Felman

“I would argue that power laws apply even more to funds than to startups.” — Alex Felman

“The intersection of venture as a product or service meets venture as a job career. And there are a lot of fund managers who see venture as a job career and essentially want to use it as a way to get a paycheck. And because of that, they’re going to put out a fairly boilerplate fund.” — Alex Felman

“Many venture funds are basically scams. I believe it’s a scam if you knowingly sell something you know you can’t deliver on. And the dirty secret in venture is if you purely look at venture from a financial point of view, most fund managers know they cannot hit their targets and yet they still sell that promise anyway. And I think that starts to become kind of scammy.” — Alex Felman

If you somehow made it to the bottom of these show notes, I’m also trying a new experiment where I write my reactions to the episode on my second blog, Superclusters After Hours. For Alex’s episode, you can find my reactions here.

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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“Venture is a Who Business, Not a What Business” | JD Montgomery | Superclusters | S7E1

jd montgomery

“One thing that is unique to private equity and venture capital is persistence is a little easier because of the brand. ‘They did good deals, so therefore, the good deals come to find you.’ If you were in a long-only private equity shop or hedge fund, Amazon is not going to come find you because you invested in Shopify.” — JD Montgomery

JD Montgomery leads the Family Office division at Canterbury Consulting and is a seasoned advisor with nearly four decades of experience serving prominent families with a focus on strategy, organization and measurement. Based in Newport Beach, he serves a select group of multi-generational families and helps them navigate the complexities of wealth, purpose, and legacy. Mr. Montgomery partners with his clients to help them optimize the allocation of their resources across generations. Over the years, Mr. Montgomery has developed a deep network of relationships in the venture capital industry. He has helped his clients gain meaningful exposure to venture funds and direct investments and develop relationships with leading innovators and investors globally. He is a Managing Director, shareholder, and board member at Canterbury Consulting. He graduated from Stanford University and holds the Chartered Alternative Investment Analyst (CAIA) designation.

You can find JD on his socials here:

LinkedIn: ⁠https://www.linkedin.com/in/jd-montgomery-6161341b/⁠

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[02:18] The “some day” exercise
[11:12] Why does JD do “some day” every 6 months?
[12:33] JD’s life line
[16:44] When JD is 85 years old…
[18:05] JD’s relationship with fatherhood despite the trauma
[22:40] Annual dad report cards
[25:33] Intentionality with GPs
[28:41] How to avoid one-hit wonders
[33:43] How to transfer self-esteem
[36:05] How do you get GPs off of their talk track?
[37:36] Non-obvious things JD looks for in GPs
[41:43] Is selling 0.2X DPI in the first 4 years meaningful?
[44:27] Should you recycle capital or deploy out of the next fund?
[46:34] Why did JD choose to work with families?
[48:07] “Never eat alone”
[51:34] How does JD think about time allocation?
[55:06] How many new GPs does JD meet with?
[59:07] How did JD pass on then back Founders Fund?
[1:03:22] The difference between unexplored gold veins and rotting trash
[1:08:13] Mayan Mocha at Austin’s Picnik
[1:08:58] JD’s secret street taco recipe
[1:11:09] JD’s reminder that we’re still in the good ol’ days
[1:13:20] Post-credit scene: No garlic and onions

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“I don’t have a mentor per se. My mentor is hundreds, probably thousands of people—I’m sure thousands—people that I’ve met where I try to learn just the amazing talent that person has and I smush it with the next person that I meet that might be most kind person that I meet or the most organized. So it’s this blend of a lot of people that really becomes the mentor.” — JD Montgomery

“DOD – dear old dad.” — JD Montgomery

“Kids grow up like trees and saplings. And a sapling needs a guiding post to hold them up when it’s windy.” — JD Montgomery

“One of the other questions I will ask is: ‘Tell me about the hardest thing you’ve ever done in your life.” — JD Montgomery

“To whom much is given, much is expected.” — JD Montgomery

“In estate planning, you can transfer money, but you can’t transfer self-esteem. Self-esteem is gained by going through the school of hard knocks and doing things and relying on yourself.” — JD Montgomery

“One thing that is unique to private equity and venture capital is persistence is a little easier because of the brand. ‘They did good deals, so therefore, the good deals come to find you.’ If you were in a long-only private equity shop or hedge fund, Amazon is not going to come find you because you invested in Shopify.” — JD Montgomery

“If they’re passionate about something—if they want to leave the world just a little different—their ding in the universe—and they want to give back, money doesn’t ruin them.” — JD Montgomery quoting a North Carolina professor

“I am not in a ‘what’ business; I’m in a ‘who’ business.” — JD Montgomery

“Gross IRR; gross performance. I don’t care. I care about net. It’s okay to show gross and then net. I prefer net. But if you show gross only, it’s just gross.” — JD Montgomery

If you somehow made it to the bottom of these show notes, I’m also trying a new experiment where I write my reactions to the episode on my second blog, Superclusters After Hours. For JD’s episode, you can find my reactions here.

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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Peter Walker as You’ve Never Seen Him Before | Peter Walker | Superclusters | S6PSE3

peter walker

“You’re making decisions in an incomplete vacuum. What I think many people should do more of, in terms of those mental models, is frame it in the reverse. Which of these decisions am I going to make that is the most regret-minimizing? That I have the least likelihood of regretting later on in life, assuming that in most cases, I will be wrong.” — Peter Walker

The holiday season has always been a great time to celebrate the movers and shakers in our world. This season we’re celebrating my personal favorites in the VC and startup world. This episode, it’s with my man, Peter Walker, who creates some of the industry’s most talked charts and graphics around the ebbs and flows of tech innovation.

Peter Walker runs the Insights team at Carta, where he works to make startups a little less opaque for founders, investors, and employees. Prior to Carta, he was a marketing executive for the media analytics startup PublicRelay and led a data visualization team at The Atlantic magazine. He lives in San Francisco, but you can find him on LinkedIn (see links below).

You can find Peter on his socials here:
LinkedIn: https://www.linkedin.com/in/peterjameswalker/
X / Twitter: https://x.com/PeterJ_Walker

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[02:52] Peter’s first brush with entrepreneurship
[11:49] 996 work culture
[17:11] Peter’s disclaimer on his data
[21:27] Regret-minimization when investing
[24:24] One example of regret-minimization
[26:07] How does Peter choose which conferences to go to?
[29:33] Conference panels are often bad
[36:22] The incongruencies of what GPs say publicly and privately
[41:43] Peter’s first data visualization
[44:18] Why is soccer underrated in the US?
[46:10] What great lengths has Peter gone for his friends?
[48:21] One worrisome trend we’re going to see in 2026
[52:18] One optimistic trend to look forward to in 2026

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“No one has to force you to work long hours if you really want to. The founders and early employees who push hardest aren’t usually doing it because someone set the office lights to stay on until midnight. They’re doing it because they care. It’s not obedience—it’s compulsion.” — Cristina Cordova

“There’s a growing recognition that that sense of compulsion, it very rarely lasts for 10 years. […] It’s very rare to find that one thing—that one set of problems—that can get you so excited for your entire life.” — Peter Walker

“Curiosity is the art of asking questions where you’re not married to the answer.” — Matt Huang

“You should probably, if you’re a founder, for instance, selectively ignore at least half of what I’m saying because it doesn’t apply to you. And your job as a founder, your job as an investor, your job as a thoughtful person is to figure out which half.” — Peter Walker

“If you torture the data long enough, it will confess to anything.”  — Ronald Coase

“You’re making decisions in an incomplete vacuum. What I think many people should do more of, in terms of those mental models, is frame it in the reverse. Which of these decisions am I going to make that is the most regret-minimizing? That I have the least likelihood of regretting later on in life, assuming that in most cases, I will be wrong.” — Peter Walker

“The worrisome part is that sometimes [selling founder secondaries] is at pretty early-stage companies—seed, A. Sometimes, it’s for $10,000 and I don’t know what happened there. Sometimes, it’s for a really sizable amount of money—seven figures. To me, that is a bubble sign. That is as close as you can get to capital is chasing consensus too much, and therefore, smart founders are just taking advantage and taking stuff off the table.” — Peter Walker

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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The Most Disappointing Podcast You’ll Ever Listen To (ft. Allie Garfinkle) | Superclusters | S6PSE2

allie garfinkle, david zhou, superclusters

Warning: This is a brief-ish, but hopefully entertaining intermission from the usual Superclusters programming. When we passed the 50th episode mark more than a few episodes ago, Tyler (my editor) and I thought it’d be interesting to record an episode where I change seats. Instead of me asking the questions, someone else would ask me questions. And I couldn’t imagine any better person to do so than my good friend, Allie, who in my humble opinion, is one of the best interviewers alive today.

Allie Garfinkle is a senior finance reporter for Fortune, covering venture capital and startups. She authors Fortune’s weekday dealmaking newsletter Term Sheet, hosts the Term Sheet Podcast, and co-chairs Fortune Brainstorm, a community and event series featuring an annual retreat in Deer Valley, Utah. A regular contributor to BBC’s Business Matters podcast, Allie is also a frequent moderator at major conferences such as SXSW. Before joining Fortune, she covered Amazon and Meta at Yahoo Finance and helped produce Emmy-nominated PBS Frontline business documentaries, including Elon Musk’s Twitter Takeover and The Power of the Fed. A graduate of The University of Chicago and New York University, Allie currently resides in Los Angeles.

You can find Allie on her socials here:
LinkedIn: https://www.linkedin.com/in/alexandra-garfinkle1/
X / Twitter: https://x.com/agarfinks

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[02:01] Art
[09:39] Competition
[17:49] Paleontology
[18:14] Allie’s Tiki mugs
[22:49] How has VC evolved?
[29:41] Evaluating risk
[43:04] Why is it important for VCs to stay in touch?
[47:10] Are there reliably good investors?
[53:09] Young GPs in market
[54:58] How useful is education that come via public talks?
[57:50] Does your niche fund size make sense for the market?
[1:01:16] Is there too much venture capital?
[01:05:24] How much of VC is art vs science?
[1:07:18] What’s going on in Allie’s world?
[1:09:45] Post-credit scene: Receipts

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

I’m intentionally keeping this section void of the things that I said since I hate the idea of quoting myself.

“Part of the point of this [investing job] is that you want to be anonymously, asymmetrically correct. And you can’t necessarily be that by saying or doing the same thing as everyone else. That being said, the worst nightmare for a VC is that no one wants to back a company they’ve backed.” — Allie Garfinkle

“If it eventually doesn’t become consensus, you were wrong.” — Allie Garfinkle

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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Timeless VS Just-In-Time Lessons | Earnest Sweat & Alexa Binns | Superclusters | S6PSE1

earnest sweat, alexa binns

The holiday season has always been a great time to celebrate the movers and shakers in our world. This season we’re celebrating my personal favorites in the LP world. To start this mini-holiday series off, Earnest Sweat and Alexa Binns runs one of the most popular podcasts on venture capital limited partners, Swimming with Allocators. I was also fortunate enough to be on their podcast as well as a bonus crossover episode.

You can find Earnest on his socials here:
LinkedIn: https://www.linkedin.com/in/earnestsweat/
X / Twitter: https://x.com/EarnestSweat

You can find Alexa on her socials here:
LinkedIn: https://www.linkedin.com/in/alexabinns/
X / Twitter: https://x.com/alexabinns

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[02:09] Alexa’s earliest relationship with money
[03:28] Earnest’s earliest relationship with money
[04:45] Earnest’s first major purchase
[06:41] Alexa’s first major purchase
[08:25] The difference between public speaking and interviewing
[12:19] Memorable guests on the SwA podcast
[14:46] To do or not to do in-person interviews
[18:05] Evolution of YouTube titles
[20:04] Why err towards evergreen content?
[22:30] Was SwA designed for LPs or GPs?
[24:12] How did Earnest and Alexa meet?
[24:56] How did Swimming with Allocators start?
[27:21] The Pandora’s Box of intros
[28:02] Alexa’s 3 buckets for LP investing
[30:12] What is ‘coming soon’ for Earnest and Alexa?
[36:58] Post-credit scene: Spider-Man & Investors as Avengers

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“Having done my investment philosophy, I’ve got three buckets. There is the ‘Let it ride, you can’t beat the market’ bucket. That’s the majority of what I’m working with. That’s 90[%] plus. There is a bucket where I’ve worked as a VC, I’ve managed a bunch of LP investments, I am better suited to vet deals than the average person. I believe in my ability to pick winners in this very thin layer of finance. Just in angel investing and GP selection where I’ve got lived experience and then my network. And then there’s a bucket for other ways capital can make your life richer.” — Alexa Binns

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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When Do You Know If You’ve Grown Up as a VC? | El Pack w/ Ben Choi | Superclusters

ben choi

Ben Choi from Next Legacy joins David on El Pack to answer your questions on how to build a venture capital fund. We bring on 3 GPs at VC funds to ask 3 different questions.

Gilgamesh Ventures’ Miguel Armaza, also host of the incredible Fintech Leaders podcast, asks Ben what is the timing of when a GP should consider raising a Fund III.

Similarly, but not the same, Strange Ventures’ Tara Tan asks when an LP backs a Fund I, how do they know that this Fund I GP will last till Fund III.

Arkane Capital’s Arkady Kulik asks how one should think about building an LP community, especially as he brings in new and different LP archetypes into Arkane’s ecosystem.

Ben manages over $3.5B investments with premier venture capital firms as well as directly in early stage startups. He brings to Next Legacy a distinguished track record spanning three decades in the technology ecosystem.

Ben’s love for technology products formed the basis for his successful venture track record, including pre-PMF investments in Marketo (acquired for $4.75B) and CourseHero (last valued at $3.6B). He previously ran product for Adobe’s Creative Cloud offerings and founded CoffeeTable, where he raised venture capital financing, built a team, and ultimately sold the company.

Ben is an alum and Board Member of the Society of Kauffman Fellows (venture capital leadership) and has also served his community on the Board of Directors for the San Francisco Chinese Culture Center, Children’s Health Council, Church of the Pioneers Foundation, and IVCF.

Ben studied Computer Science at Harvard University before Mark Zuckerberg made it cool and received his MBA from Columbia Business School. Born in Peoria, raised in San Francisco, and educated in Cambridge, Ben now lives in Los Altos with his wife, Lydia, three very active sons, and a ball python.

You can find Ben on his socials here:
X / Twitter: https://x.com/benjichoi
LinkedIn: https://www.linkedin.com/in/bchoi/

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[05:05] Ben’s 2025 Halloween costume
[06:44] Jensen Huang’s leather jackets
[07:24] Jensen Huang’s answer to Ben’s one question
[10:05] Enter Miguel, Gilgamesh Ventures, Fintech Leaders
[14:43] What are good signals an LP looks for before a GP raises a Fund III?
[22:35] Why does Ben say ‘established’ starts at Fund IV?
[25:08] Who’s the audience for Miguel’s podcast?
[27:52] In case you want more like this…
[28:32] Enter Tara and Strange Ventures
[32:46] How does Ben know a Fund I will become a Fund III?
[36:53] How does Ben know if a GP will want to build an enduring career?
[40:58] How does Tara share a future GP she’d like to work with to Ben?
[42:43] Marriage and divorce rates in America
[43:34] What should a Fund I do to institutionalize?
[46:28] Should you share LP updates to current or prospective LPs?
[48:57] Enter Arkady and Arkane Capital
[51:09] How does one think through LP-community fit?
[1:01:31] What’s Arkady’s favorite board game?
[1:03:08] Ben’s last piece of advice to GPs
[1:09:50] My favorite Ben moment on Superclusters

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“The dance of fundraising is when you do have [your thesis], the LP has to figure out is this a rationalization of the past or is it actually what happened? Was this known at the time? Because if it was, we can have some confidence in the future going forward. But if it was just a rationalization of some randomness, then it’s hard to know if Fund IV or V or VI will benefit from the same pattern.” — Ben Choi

On solo GPs bringing in future partners by Fund III… “The future unidentified partner is the largest risk that we have to decide to accept. So there actually isn’t a moment where we decide this GP is going to be around for Fund III. It’s actually the dominating risk we look at and we get there, but it’s a preponderance of other things that we need to build our conviction so high that we’re willing to take that risk.” — Ben Choi

“It’s brutal. It’s a 30-year journey. For any GP who raises a single dollar from external LPs, it’s a 30-year journey.” — Tara Tan

“I don’t think anyone goes into this business to raise capital, but your ability to raise capital is ultimately what allows you to be in this business.” — Ben Choi

On community… “Your core question is how much diversity—in the technical term of diversity—can you tolerate before you lose the sense of community.” — Ben Choi

“Most letters from a parent contain a parent’s own lost dreams disguised as good advice.” — Kurt Vonnegut

“Fundraising is a journey of finding investors who want what you have to offer; it’s not convincing somebody to do something.” — Ben Choi

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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“Venture Should Play More Like Moneyball” | Carson Monson | Superclusters | S6E9

carson monson

“The limiting downside is actually something a lot of emerging managers don’t think about. If you can turn all of your portfolio companies that don’t hit that exit velocity, if you can find a soft landing for those companies versus that’s a writeoff and they’re dead and done, that’s extra effort, but that’s an extra turn on your fund’s performance.” — Carson Monson

Carson Monson is a seasoned allocator with nearly a decade of experience backing emerging and spinout GPs across large institutions, government entities, and family offices. After stints at Greenspring, SITFO, and building a fund of funds strategy for a large European single family office, he now runs the fund of funds at CrossRange, which focuses on supporting top-tier emerging and spinout GPs.

Carson has backed everything from micro funds to high-profile managers spinning out of tier-one firms. He is deeply committed to being a thought partner and strategic resource to the GPs he supports, helping them navigate the complexities of fund building and long-term success in the VC industry.

You can find Carson on his socials here:
LinkedIn: https://www.linkedin.com/in/carson-k-monson/
X / Twitter: https://x.com/Monsson_

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[02:08] Wildlife and wholesome trouble
[06:03] The journey to being an LP
[10:54] How did Carson join Greenspring?
[13:55] Lessons across Greenspring
[15:46] How many deals did Greenspring do per year?
[18:46] An example of a qualitative metric worth measuring
[20:16] How many off-thesis bets is a VC allowed to make?
[21:25] When do GPs move from thematic bets to opportunistic bets?
[25:45] How much AUM should any one GP have?
[29:46] Why does Carson liked concentrated portfolios?
[30:32] The case for concentrated portfolios
[36:40] Relationships with GPs should stay at the LP partner level
[39:49] Fund strategy at Fund (n) vs Fund (n + 1)
[45:19] What the hell is ‘critical node theory?’
[49:54] Examples of great references
[52:58] The halo effect of mega funds
[58:48] How does Carson get to inbox zero
[1:02:09] Why is CrossRange different?
[1:08:17] The last time Carson had a pinch-me moment
[1:10:17] Carson’s ricotta gnocchi
[1:12:28] Post-credit scene: Ramen, gluten, Tokyo, and Tonkatsu Suzuki Pt 2

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

On if 20% of the fund is focused on opportunistic bets… “Wealthy is a nice word. I would say [20% is] egregious. […] 10%, it’s not like it’s the right number, but it’s the number most LPs won’t contest.” — Carson Monson

“In the past, there have been GPs who are truly excellent at one thing or a couple of things, whether that’s a thesis, strategy, or an approach. And that approach makes a ton of sense at the fund size that they’re operating at or maybe a little bit larger. In the 20-teens especially, people were able to raise more and more, and strategy drift became a huge issue. That is something managers have to face the music on now. It’s almost like the idea of being a professional baseball player and grinding and working your way up and becoming excellent and an all-star baseball player. Then being, ‘Well, the motion is similar in cricket, so I’ll just go play cricket now.’ Ya some of the motions are similar, but it’s a fundamentally different sport. Strategy drift, fund size drift; it can be a really easy trap to fall into. The motions are similar, but you lose that competitive edge when you start to play a different sport.” — Carson Monson

“If you’re more concentrated, there is an ability to impact outcomes more meaningfully. I like GPs that play a critical role in the ecosystem in which they operate in. If you play a critical role—whether that’s in go-to-market motions, whether that’s in commercialization, whether that’s in branding and storytelling—there are so many ways you can play that role. Those types of GPs tend to have an ability to move the needle for their founders more—both on the upside and limiting the downside.” — Carson Monson

“The limiting downside is actually something a lot of emerging managers don’t think about. If you can turn all of your portfolio companies that don’t hit that exit velocity, if you can find a soft landing for those companies versus that’s a writeoff and they’re dead and done, that’s extra effort, but that’s an extra turn on your fund’s performance. There is a skillset in identifying that there’s still good in a company, even if it’s not going to have this massive outcome.” — Carson Monson

“Venture should play more like Moneyball. If you can get your companies on base and limit strikeouts, that is actually so impactful at a fund level. More emerging managers should try to think like CIOs, and less like individual investors, like being a portfolio manager and managing outcomes. Obviously, venture is a game of minority positions. You do not have sole control. Playing that role for your founders, it impacts performance. It impacts reputation and, in fact, your ability to win in the future.” — Carson Monson

“You cannot say, ‘I’m going to be SV Angel today, so I can be USV tomorrow.’” — Carson Monson

“A multi-billion dollar mega fund has to have a portfolio of companies whose aggregate equity value outstrips the GDP of most small nations on this planet.” — Carson Monson

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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Can Your Check Size Win You Board-Level Transparency? | Apurva Mehta | Superclusters | S6E8

apurva mehta

“A manager doesn’t generally fit into their ultimate quartile until Year 6.”

Apurva Mehta is the co-founding Managing Partner of Summit Peak Investments, a fund-of-funds that boasts a portfolio of both venture fund investments and direct investments, including the likes of Affirm, Anduril, Airtable, Opendoor, and Wish, just to name a few.

Prior to starting Summit Peak in 2018 with his co-founder, Patrick O’Connor, he previously served as Vice President and Deputy Chief Investment Officer for the Children’s Hospital Endowment Portfolio in Fort Worth, Texa. From 2008 to 2011, he was the Director of Portfolio Investments at The Juilliard School in New York City. Apurva began his career in investment consulting and investment banking at Citigroup and Lehman Brothers. He was recognized for his expertise when he was named to aiCIO Magazine’s Top Forty Under Forty in 2012 and 2013 and honored as a Rising Star by Institutional Investor. He holds a BBA in Finance from The George Washington University.

You can find Apurva on his socials here:
LinkedIn: https://www.linkedin.com/in/apurvaamehta/

Listen to the episode on Apple Podcasts and Spotify. You can also watch the episode on YouTube here.

OUTLINE:

[00:00] Intro
[01:40] Tennis
[02:45] Lehman Brothers’ impact on Apurva
[05:28] What AI is missing in investment management
[14:26] Underestimated qualitative metrics that impact a GP’s story
[22:10] Building Cook Children’s Hospital foundation portfolio from scratch
[30:24] Moving quickly as an LP
[31:32] What does Apurva look for in the first meeting?
[37:20] Ugly sweater Christmas parties
[39:56] Apurva’s favorite ugly sweaters over the years
[41:40] Post-credit scene: What does GFW mean?

SELECT LINKS FROM THIS EPISODE:

SELECT QUOTES FROM THIS EPISODE:

“A manager doesn’t generally fit into their ultimate quartile until Year 6.” — Cambridge Associates

“If everybody’s running the other way—running from the fire, let’s run into it and there’s an opportunity here.” — Apurva Mehta

“When you think about the brand-name firms, they are iconic firms, iconic names. We love the fact that they’re co-invested alongside us. Even if we could build relationships with those firms, we didn’t feel like we’d get the transparency—maybe it was because of our check size, but maybe that’s just because of how they operate—that we needed to go to an investment committee.” — Apurva Mehta

“The transparency at the brand-name firm level is not as high as it is with the kinds of firms we back.” — Apurva Mehta

“Back then, everything was white space, building around network and ecosystems […] It was easier then because the landscape was less crowded. There were 150 backable or quasi-backable seed funds in 2012. 2000 to 3000 now backable and quasi-backable funds in the market. But it was easier then to figure out what we were looking for because it was just brand new.” — Apurva Mehta

Follow David Zhou for more Superclusters content:
For podcast show notes: https://cupofzhou.com/superclusters
Follow David Zhou’s blog: https://cupofzhou.com
Follow Superclusters on Twitter: https://twitter.com/SuperclustersLP
Follow Superclusters on TikTok: https://www.tiktok.com/@super.clusters
Follow Superclusters on Instagram: https://instagram.com/super.clusters

Stay up to date with the weekly cup of cognitive adventures inside venture capital and startups, as well as cataloging the history of tomorrow through the bookmarks of yesterday!

The views expressed on this blogpost are for informational purposes only. None of the views expressed herein constitute legal, investment, business, or tax advice. Any allusions or references to funds or companies are for illustrative purposes only, and should not be relied upon as investment recommendations. Consult a professional investment advisor prior to making any investment decisions.

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