20VC Why Facebook Will Be The Company To Succeed in Crypto, Why Founders Should Be Actively Angel Investing & Commonalities of Great Leadership From Mark Zuckerberg to Mark Pincus with Darian Shirazi, Founder & CEO @ Radius

In this episode of "20 Minutes VC," Harry Stebbings interviews Darian Shirazzi, founder and CEO of Radius, a company revolutionizing B2B marketing with data intelligence, having raised over $105 million from top investors. Shirazzi recounts his journey from being Facebook's first external engineering hire to investing in startups like MessageMe and Sprig. He emphasizes the importance of embracing challenges, taking calculated risks, and the relentless pursuit of one's mission. Shirazzi also shares insights on fundraising strategies, the value of investor networks, and offers his perspective on the crypto market, particularly his bullish stance on Bitcoin. Finally, he encourages graduates to take risks, avoid complacency, and strive to make a positive impact on the world.

• Harry Stebbings is the host of "20 minutes VC and Founders Friday."
• Darian Shirazzi is the founder and CEO at Radius.
• Radius is a startup that provides data and insights for B2B marketing.
• Darian Shirazzi has a background as the first external engineering hire at Facebook and worked at eBay.
• He has made angel investments in companies like MessageMe, Sprig, and Chai.com.
• Thanks to Leor Avadar at Lob and Matt Garrett at Salesforce for introducing Darian Shirazzi to the show.
• Sponsors mentioned include Ring and Cooley, a global law firm.

This is the 20 minutes VC and founders Friday with me, Harry Stebings.

Harry Stebbings is the host of the podcast, introducing the episode and the guest.

We had so much fun doing the show and so I'm very thrilled to welcome Darian Shirazzi, found and CEO at Radius.

Harry Stebbings expresses his excitement about having Darian Shirazzi on the show.

Darian has raised over $105,000,000 in vc funding with radius from some of the very best in the business.

This highlights Darian Shirazzi's success in raising a significant amount of venture capital for Radius.

Prior to Radius, Darian has enjoyed roles such as first external engineering, hire at Facebook, and working on the sell your item team at eBay.

This provides background on Darian Shirazzi's previous professional experiences.

• Ring first gained attention on Shark Tank and offers a video doorbell and Floodlight Cam.
• Cooley is a law firm that supports startups and venture capital firms.
• Cooley has a history of forming venture funds and represents a large number of high-growth startups.

Today, over a million people are using the Ring video doorbell to help protect their homes.

This is a testament to the success and widespread adoption of Ring's product.

Cooley also represents more than 6000 high growth startups across the globe.

Cooley's representation of a large number of startups highlights its significance in the startup legal space.

• Darian Shirazzi enjoyed large markets and network effects from a young age.
• He was an only child and kept himself busy by building things, like structures with Legos.
• Building a company is seen as the best way to bring big ideas to life.
• Darian has been involved in various big markets and companies, dedicating 150% of his time to Radius currently.

I always wanted to build things. I had an obsession with building my own ski resort at one point.

Darian Shirazzi shares his childhood interest in building and creating, which foreshadows his entrepreneurial spirit.

The best way to build something and really have an idea go from zero to something huge is to build a company.

This quote emphasizes Darian's belief in entrepreneurship as a means to realize big ideas.

• Darian Shirazzi became an engineer at Facebook at the age of 17.
• He learned that startups are hard, involve constant struggle and challenges.
• Embracing ambiguity and chaos is key to startup success.
• Taking smart risks is encouraged, as it can lead to progression and innovation.
• His experiences at Facebook and other startups have been instrumental in his approach to business and decision-making.

Startups are just a constant struggle. And there's always a new challenge.

Darian Shirazzi reflects on the challenging nature of startups and the importance of embracing these challenges.

Fortune favors the bold, which is really, really an important phrase.

This quote, which Mark Zuckerberg carved into his wall, influenced Darian Shirazzi's perspective on taking risks.

• Darian Shirazzi has observed a cohort of leaders like Mark Zuckerberg, Aaron Levie, and the Udemy team.
• He notes commonalities in their leadership styles and company-building characteristics that contribute to their success.

You've seen this cohort of incredible leaders. Are there commonalities amongst their leadership styles and their kind of company building characteristics that you think made them so great?

Harry Stebbings asks about the traits that make certain leaders successful, seeking insights from Darian Shirazzi's experiences with various influential figures.## Characteristics of Successful Entrepreneurs

• Successful entrepreneurs share certain characteristics, even among those who have experienced failure.
• They exhibit tenacity, competitiveness, and a deep emotional connection to their mission.
• These traits are considered part of the "code of the founder," a term used by Mike Moritz of Sequoia.
• Angel investors and VCs often bet on individuals with these personality types, as they tend to be right more often than not.
• The ability to persevere and remain relentless is seen as irreplaceable in founders.

"And the interesting thing amongst all these founders is that they really don't know how to give up. They don't know how to lose, and they're competitive, and they are emotionally attached to their mission."

This quote emphasizes the resilience and determination common among successful entrepreneurs, highlighting their competitiveness and emotional investment in their endeavors.

• Balancing idealism with realism is challenging, especially when market dynamics are rapidly changing.
• Founders must be adept at reading market signals to make informed decisions about their businesses.
• The ability to adjust to macro and micro economic changes is crucial for startups, particularly those with high valuations aiming for public offerings.
• Recent examples include companies that have faced difficulties due to changing expectations from investors and market conditions.

"I really do believe that founders have to be able to read the market and that's hard to do."

The quote addresses the difficulty founders face in interpreting and adapting to market dynamics, which is a critical skill for the success and survival of their companies.

• The recent shift in investor expectations towards capital efficiency in SaaS businesses has made a sustainable growth mindset more important.
• The strategy for growth depends on the nature of the business, with new category creators requiring more investment compared to businesses in established categories.
• Businesses with innovative technologies in established markets may afford more sustainable growth over time.
• The importance of operational efficiency has been recognized by investors and larger companies alike.

"So we definitely have had to take a hard look at that in the past few quarters. Is that how do we get more capital efficient?"

This quote reflects the introspection and strategic planning required for businesses to adapt to the new investor expectations for capital efficiency.

• The desire to build a new market category was a driving factor in the fundraising strategy.
• The founders believed in the potential of data and intelligence to revolutionize CRM.
• Selecting investors who were willing to take risks on innovative ideas and new market categories was essential.
• The company sought investors who were not focused on immediate sustainable growth but on the potential to lead and shape the market.
• The choice of investors was influenced by their ability to understand and support the company's vision to create a new market.

"And those are investors that are not ones that look for that sustainable growth really early on. They look for can they lead the market and can they start to get great customers?"

This quote explains the rationale behind choosing investors who prioritize market leadership and customer acquisition over immediate sustainable growth.

• Beyond providing capital, empathy and a strong network are highly valued by entrepreneurs.
• Having investors with a relevant and influential network can be critical, especially for businesses reliant on large enterprise customers.
• The introduction of key customers by investors can significantly impact a company's growth and success.

"Our business is driven by large enterprise customers. And for example, the ABC team introduced us to comcast, and that's now our largest customer."

The quote highlights the tangible benefits of an investor's network, demonstrating how a single introduction can lead to significant business opportunities.## Importance of Urgency in Fundraising

• Creating a sense of urgency is vital in fundraising to minimize distractions.
• Fundraising can be a distraction from focusing on the business.
• Getting quick responses from investors, especially nos, is beneficial.
• Creating urgency helps in identifying truly interested investors.
• It's important for founders to push for clear answers to move on quickly.

"Urgency is really important for the sake of your business. Raising money quickly is very important, and the longer it drags out, the more that it's distracting."

This quote emphasizes the need for speed in fundraising to avoid prolonged distraction from business operations.

"Investors don't like to say no because they don't like closing the door on potentially good opportunities."

This quote reveals the hesitance investors have in outright rejecting opportunities, making it hard for founders to gauge true interest.

"We found that we got a ton of people to say no in our early days, but there were a number of top tier investors as well that said yes. And it was because we created that urgency early on."

This quote illustrates the effectiveness of creating urgency in securing investment from top-tier investors.

• Direct communication can effectively drive outcomes in negotiations.
• Drawing a line in the sand can compel investors to make a decision.
• Founders should not fear receiving a 'no' as it allows them to move on.

"And he basically used a line with one of the investors he was trying to court or get into the company, and he like, if you want to do it, just do it. And it was over dinner. And that sort of drawing a line in the sand and saying it that way really worked because it really drove an outcome."

This quote describes a successful tactic used by Mark Pincus to drive urgency in an investor decision during Zynga's fundraising.

• Angel investing by founders can be seen as a lack of commitment.
• Darian Shirazzi disagrees, stating it doesn't take much time and can provide fresh perspectives.
• Trust in one's network can streamline the investment process.
• Angel investing can be beneficial without being a significant distraction.

"It doesn't take that much time to manage these investments or to evaluate investments?"

This quote challenges the belief that angel investing is time-consuming for founders.

"I think that there are a lot of top tier investors that encourage their founders to do this."

This quote suggests that some top investors actually support founders engaging in angel investing.

• Shirazzi's angel investing strategy is based on trust in his network and the potential for businesses to raise further capital.
• He evaluates whether the business is in a massive market and if the founder has certain qualities.
• His strategy has led to successful investments and a valuable founder network.
• Shirazzi avoids trend chasing in angel investing, focusing on unique opportunities.

"I don't have a specific portfolio strategy because I frankly think that that leads to trend chasing, which is very, very challenging."

This quote explains Shirazzi's approach to angel investing, highlighting the pitfalls of trend chasing.

• Network effects are a common theme across Shirazzi's investments.
• His experience with network effects at Facebook and with Bitcoin mining influenced his investment decisions.
• Network effects can lead to rapid growth and market dominance.

"My best friend from high school and I were mining bitcoin in 2011. So it's just like we've seen network effects and how those can shape the market and how those can grow really fast."

This quote provides personal background on Shirazzi's experience with network effects and their impact on market growth.

• Shirazzi identifies as a Bitcoin maximalist and believes in its long-term potential.
• He sees Bitcoin as a leader due to strong network effects and practical use cases.
• Ethereum is considered interesting despite founder risk.
• ICOs are noted as an innovative fundraising method needing regulation.

"I am what most people call a bitcoin maximalist."

This quote identifies Shirazzi's stance on cryptocurrency, showing a strong belief in Bitcoin's future.

"I also think that ICos are super interesting. They're going to get regulated, but it's a great way to raise capital."

This quote highlights Shirazzi's view on ICOs as a novel but regulatory-bound method of raising capital.## Crypto and Facebook's Potential Impact

• Discussion about the need for more work and disclaimers around white papers in the crypto space.
• Belief that Facebook could potentially succeed in crypto due to its large user base and infrastructure.
• Facebook could create the largest Initial Coin Offering (ICO) and cryptocurrency by allowing users to move money through a crypto proxy.
• Facebook is seen as the only competitor to Bitcoin.
• Personal stance on being long on Bitcoin and its educational value.

"But I think it's a fantastic way for these new ideas to raise money. Now, I will say also that on crypto, I think that there's a high probability that the company that will really succeed in crypto will be Facebook."

This quote expresses the belief that Facebook has a strong chance of success in the cryptocurrency market because of its existing user base and platform capabilities.

• 'Sapiens' is recommended as a must-read book.
• The book explores the evolution of Homo sapiens, their ability to rally around ideas, and its impact on the modern economy and society.
• 'Sapiens' provides insight into human evolution and cooperation.

"Sapiens. I think you should definitely be reading. It's a fantastic book."

The quote highlights the recommendation for the book 'Sapiens' and its significance in understanding human evolution and societal development.

• "Fortune favors the bold" is a favored quote.
• Acknowledgment of learning from mistakes and challenges.
• Emphasis on the importance of facing life's challenges head-on.

"Fortune favors the bold. That's the one I think I brought up earlier in the interview. It definitely is my favorite."

The quote underscores the speaker's preferred motto, which encapsulates the value of taking bold actions and the positive outcomes that can result from such an approach.

• A near-death experience served as an inflection point.
• The experience led to a greater appreciation for life and a focus on commitment, loyalty, and building meaningful things.
• The realization that life is short and uncontrollable events can happen.

"And that flexion point made me realize that there are random events that happen. There are things that you can't control."

This quote reflects on a pivotal moment in the speaker's life that brought into focus the unpredictability of life and the importance of being mindful of one's actions and priorities.

• Encouragement to take risks and fail early.
• Advice against settling for a desk job and the importance of making the world better.
• The need to think progressively to avoid being replaced by automation.
• The importance of contributing to society, whether through starting a company, community involvement, or research.

"Yeah, my advice would definitely be, take risks and fail early."

The advice given to graduates emphasizes the value of taking risks and learning from failures at an early stage in one's career.

• Uncertainty about personal plans, but a commitment to building Radius.
• Openness to exploring new markets and interests due to a curious nature.
• The focus is on the growth of Radius and considering future opportunities.

"But for me, there's going to be a lot of things that I dabble in because just have a wandering mind."

This quote conveys the speaker's openness to exploring various interests and opportunities while remaining committed to the growth of their current company, Radius.

• Promotion of the Ring video doorbell and Ring Floodlight Cam for home security.
• Mention of Cooley law firm's support for startups and venture capital firms.
• Cooley's track record with venture funds, startups, and IPOs.

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The quote is part of a promotion for a product sponsor, offering a discount to listeners and highlighting the product's benefits.