20VC Do VC's Really Hustle Enough The Takeaways From Watching Twitter Scale From 30 to 2,500 & Why Chris Sacca Is Like Yoda with Ryan Sarver, Partner @ Redpoint

In this episode of "20 Minutes VC," host Harry Stebbings interviews Ryan Sarver, a partner at Redpoint Ventures. Sarver, with a background as a self-taught programmer and former director at Twitter, shares his journey into venture capital and his passion for early-stage consumer startups. He discusses the importance of company values, the challenges of organizational behavior, and the role of entrepreneurial grit in overcoming the inherent difficulties of startups. Additionally, Sarver touches on the potential of AI as a transformational platform and the strategy behind Redpoint's EIR program, which fosters the development of new ventures. The conversation also explores how Redpoint mitigates signaling risks in multi-stage investing and the firm's collaborative approach with industry experts like Andy Rubin to stay ahead in the AI space. Sarver's latest investment, Luxe, exemplifies his investment philosophy of supporting teams with big visions and the determination to revolutionize large markets.

• Harry Stebbings introduces the special feature week of Redpoint on the 20 minutes VC podcast.
• Ryan Sarver, a partner at Redpoint, is welcomed to the show.
• Ryan's background includes being an early investor in Memoir and leading seed and Series A rounds at Lux.
• Ryan's previous roles include Director at Twitter, overseeing the Twitter platform and developer ecosystem, and Director of Consumer Products at Skyhook Wireless.
• Cooley, a global law firm specializing in startups and venture capital, is mentioned for their operational support to venture funds.
• Eve, a direct-to-consumer mattress company in the UK, is introduced with an offer for podcast listeners.

This is the 20 minutes VC and I'm your host Harry Stebbings at h Stepbings on Snapchat. And for the show today, we are back to the land of Redpoint for this very special feature week of Redpoint.

This quote introduces the podcast and its focus on Redpoint during the special feature week.

• Ryan Sarver shares his non-traditional path into venture capital, starting from his childhood in Michigan.
• He became a self-taught programmer in middle school, engaging in AOL chat rooms and BBS's.
• Ryan did interface design for Winamp in Photoshop and took on contract jobs during college.
• He worked remotely on programming projects from his dorm room.
• Ryan shares an anecdote about meeting Travis Kalanick, a founder of Scour, and their connection.
• Sarver's journey led him to various startups in Boston, Skyhook Wireless, and eventually to Twitter.
• A direct message from a Twitter employee led to his move from Boston to San Francisco and a job at Twitter.
• After four years at Twitter, Sarver considered starting his own thing but was persuaded by Redpoint to try investing full-time.

Yeah, I think I've had probably a fairly non-traditional path and adventure and so hopefully it's kind of an interesting story.

This quote summarizes Ryan Sarver's unique journey to venture capital, highlighting his non-traditional background.

• Ryan Sarver's experience at Twitter, growing the company from 30 to about 3,000 employees, influenced his career decisions.
• He enjoyed the early stages of building a company more than managing larger scale operations.
• The desire to repeatedly experience the early foundational moments led him to venture capital.
• Ryan felt that venture capital offered the opportunity to work with smart teams across different categories.
• He believed that if being a venture capitalist didn't work out, he could always return to starting his own company.

And what was it then that enticed you really to venture? Was there a realization or a turning point that made you think that it was the viable career that you now have instead of the hands on operational role?

This quote encapsulates the motivation behind Ryan Sarver's shift from an operational role at Twitter to a career in venture capital, driven by his preference for early-stage company development.

• Values are crucial in guiding companies through difficult times.
• Companies should be principle-driven from the beginning.
• Values determine what matters to the company and provide a north star for decision-making.

"One of the things that really jumped out to me is how much kind of values matter."

This quote highlights the significance of company values in shaping the culture and guiding principles of a company, as observed by Ryan Sarver during his time at Twitter.

• Understanding organizational behavior is key to driving efficiency towards goals.
• Companies must constantly reorganize teams and principles as they grow.
• Structures that work for small teams often break down as the company scales.

"I think the other one that I went in not having known much about ahead of time, but walking away with a real deep respect for is kind of organizational behavior and how you structure companies and teams to drive towards these goals in the most efficient way possible."

Ryan Sarver discusses how his experience at Twitter gave him a deep appreciation for the importance of organizational structure and behavior in achieving company goals.

• Investing in early stage companies requires hustle and networking.
• Investors look for teams with grit, determination, and a vision for big problems.
• Market potential and team dedication are key factors in investment decisions.

"God, I wish there was probably more of a complete strategy."

Ryan Sarver expresses that while there may not be a rigid strategy, identifying and supporting dedicated and visionary teams in potentially large markets is crucial for early stage investing.

• Startups require immense grit and hustle to overcome challenges.
• Venture capital also demands hustle but is less stressful than being a founder.
• Venture capitalists need to balance effort and opportunity to succeed.

"So you look for teams that have grit and determination because startups are incredibly hard."

This quote emphasizes the importance of finding teams that possess the necessary resilience and work ethic to navigate the challenges of starting and growing a business.

• Signaling risks can occur when venture capital firms invest in multiple stages.
• Redpoint mitigates this risk by treating early and late stage funds as separate entities.
• Having outside firms set valuations is generally preferred within the community.

"It's generally better within the community to have outside firms kind of price and set valuations for your own companies."

Ryan Sarver explains Redpoint's approach to managing signaling risks by keeping early and late stage investments distinct and relying on external valuations.

• EIR programs vary by firm and can be a path for entrepreneurs to assess.
• Redpoint has a history of successful EIRs, including the founder of Android.
• EIRs at Redpoint have the freedom to shape their own experience.

"But satish. One of our other partners was an EIr here, founded a company that Redpoint invested in, came back as an Eir, and then eventually became a partner here."

Ryan Sarver shares an example of a successful EIR at Redpoint, demonstrating how the program can lead to significant contributions and career progression within the firm.

• Entrepreneurs have different preferences for their work environment and structure.
• Some prefer the structure and repeated interaction with a consistent group of people.
• Others prefer working from home with a diverse set of individuals.
• The choice of environment can influence the development and pitching of business ideas.

"I personally like having structure to my day, a place to come to a repeatable set of people that I can bounce ideas off of and start kind of formulating a point of view on where I want to go with an idea."

This quote explains the speaker's personal preference for a structured work environment with a consistent group of colleagues to engage with when developing ideas.

• EIRs have access to a wide breadth of industries and developments.
• Being an EIR is beneficial for individuals who are seeking inspiration or a co-founder.
• EIRs can explore various fields such as hardware, robotics, AI, healthcare, consumer enterprise, etc.

"So what it does give you is it allows you to be able to see a really wide breadth of things going on in the world, from hardware, robotics, AI, healthcare, consumer enterprise."

This quote highlights the diverse exposure an EIR gains, which can be instrumental in finding inspiration and potential business opportunities across various sectors.

• Most major venture funds have some version of an EIR program.
• The programs vary in size and require management to ensure EIRs benefit maximally.
• EIR programs are considered a worthwhile investment to grow networks and create new opportunities.

"It takes a little bit of management to make sure that the IRs are getting the most out of it."

This quote emphasizes the need for active management within venture funds to maximize the value EIRs receive from their experience.

• EIRs can provide educational support to portfolio companies.
• They offer a perspective that helps refine investment frameworks.
• EIRs' experience in various fields can guide investment decisions.

"And so there's kind of an education and support of our existing portfolio and friends across the portfolio, which I think is meaningful for companies in our portfolio, but also for the IR to help them kind of think through all the things that they've learned and help even potentially refine the framework that they think about going forward."

The quote explains how EIRs contribute to the education and support of portfolio companies and assist in refining the investment firm's approach to assessing companies.

• AI is experiencing exponential growth due to major breakthroughs.
• Billions are being invested by major companies to develop AI capabilities.
• AI's potential is seen as vast, with the ability to perform tasks unimaginable today.

"I think, one, there's just been a few major breakthroughs in AI that are creating this kind of exponential growth in the opportunities and in the results that come out of AI."

This quote suggests that recent advancements in AI are leading to rapid growth in the field, offering significant opportunities for future applications.

• Large data sets are necessary for improving AI models.
• Big tech companies with data advantages could monopolize AI.
• Strategies to compete include building proprietary data sets through hardware and sensors.

"So I think there for sure is a concern that the big groups are going to run away with it."

This quote expresses the concern that large corporations with extensive data sets could dominate the AI landscape, creating a monopoly.

• Hardware and sensors are seen as a means to collect new, proprietary data.
• Companies are encouraged to think about creating new data assets.
• Hardware is viewed as a strategic entry point to compete against established tech giants.

"But if you're the cloud computing service behind that, you're capturing and receiving all of that proprietary data that hasn't existed before, and you're getting the only purview into it."

The quote discusses how hardware can be a source of unique data, which can be leveraged to improve AI models and potentially lead to market leadership.

• It's easier to build smart devices today than ever before.
• Despite improvements, hardware development remains challenging.
• Supply chain improvements and better tooling have been developed.
• Physical device production can face issues like environmental contamination.
• Hardware takes longer to iterate than software due to physical production and shipping.
• Playground's mission is to simplify hardware and software development.

"So it is easier than it ever has been, but hardware is still very hard."

This quote emphasizes the dual nature of hardware development: it's become more accessible, yet it retains inherent difficulties.

"And I think one of Playground's missions is, is to build that platform both on the software and hardware side and build those primitives to make it easier for people to kind of build on top of it."

This quote highlights Playground's goal to create foundational elements that simplify the process of developing hardware and software.

• Opening up Siri is seen as a smart move by Apple, though it was implemented later than ideal.
• Platforms gain value by increasing their surface area.
• The success of this move depends on the integration quality.

"I think it's a really smart move. A little late, but a smart move."

The quote conveys that Apple's strategy is wise but could have been more timely.

• Viv is considered promising despite an underwhelming demo.
• It's still in the early stages of development.

"I think it's promising. I like the direction of it. I thought the demo was a little underwhelming, but it's early."

This quote expresses cautious optimism about Viv's potential, acknowledging its current limitations.

• "Sapiens" is praised for its broad perspective on human history.
• The book covers the development of human societies, money, religion, and social communities.

"It's this crazy macro view from kind of the homo sapiens on, and the development of money and religion and social communities."

This quote summarizes the expansive scope of "Sapiens" in examining human history.

• Different life stages require different mentors.
• Parents, a high school hockey coach, and Chris Sacca are mentioned as influential mentors.
• Mentors have shaped personal principles, adulthood, and provided career advice.

"I think the different stages of your life probably require different mentors because I think I have probably a few different ones."

This quote acknowledges the evolving need for mentorship throughout one's life.

• The update allowing exclusions from the character limit is welcomed.
• The change was viewed as overdue.

"Fucking finally. Yeah, it's too long."

The quote expresses relief and frustration at the delay in implementing the character limit update.

• Luxe was chosen for investment due to its market potential and team.
• The service addresses parking issues with a better quality and price point.
• The investment followed a pattern of supporting businesses that create addictive behaviors and magical experiences.

"But I think what got us excited about that was I had been close with Travis and Ryan and Garrett and kind of the early Uber days and got to see the evolution of how they would create this behavior that people got so addicted to."

This quote explains the rationale behind the investment in Luxe, drawing parallels to the success of Uber.

• Ryan Sarver is optimistic about his move into investing.
• Harry Stebbings promotes following their social media and newsletter for updates.
• Cooley, a law firm specializing in startups and venture capital, is recommended.
• Eve Mattress is endorsed for its consumer-friendly trial and return policy.

"Harry, thanks so much for having me, man. Great to meet you."

This quote is a polite conclusion to the conversation, expressing gratitude for the discussion.

"And if you'd like to stay in the world of the 20 minutes VC and redpoint, then you can follow me on Snapchat at htebbings, or you can follow Ryan on Twitter at rsava."

This quote provides information on how to stay connected with the hosts and their content.