E16: Syndicates, Angel Investing, and Founder-First Investing with Alex Pattis

Welcome to Investing in Startups. I'm Joe Maker. Join me as we delve into the strategies and stories of some of the leading minds in early-stage startup investing. Whether you're a seasoned pro or just dipping your toes into startups, this podcast is your guide to navigating this dynamic ecosystem. Thanks for listening and enjoy the show. Joe Maker is the founder and managing partner of Seaplane Ventures. The content here is for informational purposes only and should not be construed as investment legal or tax advice. The opinions expressed by guests are their own and do not reflect the views of Seaplane Ventures. Our host, guests, and clients may hold investments discussed in this podcast.

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Our guest this week is Alex Pattis, general partner of Riverside Ventures. Riverside's an early-stage firm that operates both a traditional venture fund, but also a syndicate with more than 6,000 LPs. Alex and I talked about the rise of syndicates, how they work, why he thinks most VCs oversell the value they add to founders, and what he's excited to invest in today. Please enjoy. Alex, thanks for coming on the show.

Great to be here, Joe. Excited to, to chat with you.

So you have a lot of different things going on, but maybe let's start with talking about Riverside Ventures.

I actually joined Riverside Ventures in 2020. It was started by Brian Rosenblatt, who's now a partner at Craft Ventures, so he works for David Sacks's fund. And I had started syndicating deals while I was operating at my previous business, and I met Brian, who was a pretty active syndicate lead, and we ended up like partnering up on a handful of deals, maybe like, I don't know, 6 to 10 deals over a year-ish, year-plus timeframe. And at the time it was kind of like a transition for him because he had started the syndicate before he actually made his way into venture and joined Craft. But when I met him, he had just started at Craft and we had like good synergy of pretty much just leveraging both the deal flow from his side and my side, as well as the LP base he had built out, the LP base that I was kind of growing in real time or in parallel to him. So we collaborated on a bunch of deals, and then eventually he asked me to kind of run, operate, and take over Riverside, which I felt was like a— it was a good opportunity. It was a more established syndicate in 2020, which was very early. I still think we're early innings for syndicates. So that was super early. And then yeah, around that time, that's when I officially took over. I guess over the years we primarily operate as a syndicate, right? So we are always growing the LP base with all sorts of different individual credit investors, some smaller family offices. We are consistently sourcing deals really across all stages. Early on, I was a lot more focused on early-stage investing, whereas maybe pre-seed, seed, and a little bit of Series A, whereas now a little bit more generalist for new opportunities. Also a lot of follow-ons on companies that over the years have grown into these growth stages. But yeah, we operate a syndicate in a different fashion than your traditional venture fund in that We are consistently looking for exciting opportunities to back exciting founders, but also rounding up capital on a deal-by-deal basis from our kind of ever-growing LP base. And I, there's a lot of different avenues I can discuss, like how a syndicate works, but let me pause there on the kind of quick intro and happy to go whichever route is most helpful. Sure.

No, that's great. And just to get a sense of scale, how many LPs do you have in your network? Or syndicate?

Great question. So we've got almost 6,000 LPs in total. That sounds like a holy crap number, right? Like no venture fund's going to have that many LPs. What I will say is the details matter, right? Like not all 6,000 are active today or have all invested in a deal. We've got a little bit over 3,000 that have invested in at least one deal. And we have a lot of folks that are active or becoming active right now. But at the same time, of those 6,000, there's a number of folks that were maybe more active in 2018 to 2021 and less active now. So there's a lot of details I would say that go into that 6K figure of number of LPs.

How about you walk listeners through how a typical deal comes together through an SPV and a syndicate?

A big thing for syndicates in general, and, and definitely the way we operate, we do not lead rounds, we do not set terms. We're— we've really leaned into the co-investor model. And so therefore, it's important for us to have a lead in place and terms in place if we're going to syndicate a deal and bring it out to our audience. So there's times where we meet the founder ahead of terms being set, Uh, sometimes we're helpful in that process in securing a lead and, and getting those terms set. Other times they're doing it themselves. We're, we're just looking at this through the sourcing angle. And then a lot of times we meet them when there's a lead in place and they're kind of rounding out the round with some smaller checks where we fit well. So that's typically the timing of kind of when we're meeting the founders, getting to know them, doing diligence. We definitely like piggyback quite a bit off of kind of the diligence done by the lead, right? We're not underwriting these terms, so we'll certainly lean into kind of what's been done previously by ideally tier 1 funds or funds that we know and have co-invested with before. And then from there, so we're typically securing an allocation, which truthfully is kind of a guess of me kind of sizing up the business, the round, and getting an estimate on what we think we'd So hypothetically, let's say it's a seed round, they're raising $3 million, and we think that we're going to put together a $200K SPV. I would kind of request that allocation, but also be transparent to the founders that we may get a little bit more than that. We may get a little bit less than that. I'd love to have, you know, a 10-day to 2-week turnaround time to kind of put together our deal materials and share it with our LPs. So then we can narrow in on, great, you know, that $200K is actually $175K or $250K. We allow flexibility because I appreciate founders working with us where it's not as black and white as a traditional fund where the money's there ready to go. I try to explain that to them and just be very transparent on the process. What would take place from there? So it's typically like call it 1 to 2 day setup of putting together deal materials where it's kind of like a memo that just supports why we're excited about this team, this opportunity, details on market solution, problem traction, assuming there is some. And we just try and build like a comprehensive understanding of how we're looking at this opportunity that our LPs can read through alongside a deck that the company would have. And then once the SPV is set up and in place, we would then kind of invite our LPs to join. I'm never really inviting all 6,000 LPs. I think there's kind of depending on the deal, there's kind of various levels of sensitivity. So I'll kind of figure out which LPs I'd like to send the deal to.

As in founders wouldn't love having their traction metrics blasted out to 6,000 people.

Exactly right. Like they, they would want to have it be shared with maybe the more active folks or relevant folks. Um, it, it definitely depends on the business, the stage, the founder, but generally speaking, that's accurate. So yeah, from there we would send it out. I mean, every, every deal kind of has the same process where it's like, uh, okay, we've launched it. Like, here's the materials. A lot of our LPs know it's typically like a 1 to 2 week turnaround time if they want to participate. And then throughout those 1 to 2 weeks, we'll pretty much kind of highlight, hey, if the deal's moving quickly, we'll just inform folks that, hey, the deal's moving quickly. We might fill up our allocation quicker than expected. And for those who are interested, they should get moving. And then sometimes we'll also just issue like a final call. So we're trying to manage, like the goal is to, from my perspective, I want to raise that capital as soon as possible, just so We've got the allocation, it's there, and then we can go ahead and officially sign wire and close. But things can get interesting where we have a lot more demand than I suspected in that $200K allocation. Maybe I'm trying to get $300K, $400K. So I'll work with the founders to see what they could take, and if they can take more, that's great. I don't want to kind of leave capital on the sidelines from our LPs, but again, at the same time, We'll work with them based on kind of how the round is shaping up and the speed. And sometimes we do oversubscribe and we'll need to send some capital back to LPs. And then sometimes it's the opposite where I thought we were going to raise $200K, maybe we only raised $100K, and I'll explain that to the founder. Ideally, they'll be okay with it and we'll go ahead and wire that $100K. But we are constantly on the treadmill.

Every deal.

We kind of start from square one on putting the materials together and raising the capital versus, it's a backwards approach versus a traditional fund where you've got the capital, you know how much you're going to deploy out of your fund, and once you decide on a deal, you're signing and wiring the capital from your bank account to their bank account. Whereas, yeah, as I explained, a bit of a different process in running syndicates deal by deal.

We've had angel investors on the show. We've had a number of VCs with traditional fund structures on the show. And for folks listening, I think you can probably piece together that SPVs are somewhere in between, right? Where if you're doing angel investing, you're typically sourcing the deal, you're negotiating terms, or you're working your way into a round, you're doing the allocations directly. If you're in a venture fund, you've basically outsourced that to a manager, but an SPV is kind of in between where you've got an Alex out there sourcing deals for you. It's up to you to determine whether or not you want to participate, how much. Is that fair to say? Is there anything I'm getting wrong?

I would say that's very fair. I look at it similarly to you, right? Like we're kind of like a VC in that it's not just our own capital. We are raising capital from LPs the same way VCs deploy their LP capital. The process is different, right? Where VCs, their LPs are really betting on them to allocate on their behalf. I would say that's partially true with us, but a lot of it is really us sharing a specific deal opportunity and having RLPs getting the opportunity to look at that deal, evaluate for that deal if they want to participate. It's kind of like an angel in that like we're not institutional investors. I think the way we operate and think can be quite similar to an angel, but then we're layering on that kind of outside capital piece that starts to be more like a venture Traditional VC. And it's also interesting, like, I think, I don't even know an angel. And like, I would argue that today a lot of folks who are LPs in our syndicate and other syndicates would consider themselves angel investors, right? Like they're investing their own personal capital into startups. They're not necessarily negotiating terms or necessarily have that founder relationship. that we would've seen more traditionally 5, 10 years ago. So I think even just like who's an angel investor and how that term is kind of coined might be, have changed or be changing over time. But hopefully that explains the kind of where syndicates fit in versus your typical angel and typical VC.

No, that's a great point. There was an article in the Wall Street Journal, which I saw it through your LinkedIn, which is how I came across it, about the state of angel investing. And they mentioned in the article, the value of angel deals in the US fell 64% from 2015 to 2023. Pretty staggering fall. And that's in nominal terms, you know, it's not adjusting for inflation. How do you think the rise of SPVs has played into that versus maybe other factors that have seen angel investing take a backseat relative to some other ways for people to invest?

I think syndicates are very helpful for founders. Like, regardless of who are the LPs in the syndicate, who's the syndicate manager, right? Like, that, that's kind of what matters in winning allocations. But I think just the process of running SPVs and taking up one line item on the cap table makes a lot more sense for founders and keeps the cap table a lot cleaner, right? So whether it's Working with syndicates because they're going to write a more significant size check than an individual angel, and it's cleaner for the cap table, or doing like a roll-up vehicle where the founder's like, hey, I've got all these awesome people that friends, family, previous boss, whatever it may be that want to write, you know, small checks, sub $25K checks. You know, you have these vehicles that kind of allow them all to to roll up into one line item on the cap table. So I think it just makes sense from a cap table perspective. And then, yeah, I think things are getting a lot more competitive early stage, right? Whether it's pre-seed or seed, the best founders that are raising from the best investors and VCs, there's a lot of hype around that, right? And I think they're going to raise their rounds pretty quickly and there's not necessarily going to be this leftover allocation for them to spend time talking to whoever the individual angels are to get these smaller checks in. I think there's still a ton of value in angel investors, and I think founders see that and definitely want that. Yeah, we've seen a lot of these bigger funds getting in earlier and earlier. It's making it harder for individual angel investors to get into the best deal. So that's kind of what I'm seeing. I think, yeah, syndicates are kind of that in-between where I think in many founders' eyes they might look at syndicates maybe closer to an angel investor, or at least I would say that for myself, right? Like a lot of the, the founders I invest in and I get allocations in and put these SPVs together, you know, they look at me as like, Alex, like, yeah, I'm, I'm responsible for 100, 200, 300 K, uh, SPV, whatever it may be, they're interacting with me, and probably I operate a bit more agile like an angel investor. So it'll definitely be interesting to see how things increase, but I think that rise of syndicates have, have made like a more conducive path for founders to keep the cap table clean, work with folks, and, and potentially funnel these value-add individual angels through a given SPV, which is I guess a good point to make, right? There are times where we're investing and the founder, you know, I explain how the syndicate process works, how we're going to have a bunch of different individuals that come into our special purpose vehicle, and the founders will actually say, oh, that's actually cool. Like my cousin, my ex-colleague, my friend is interested in doing a $5K, $10K check. Can they come through your vehicle? And we love doing that. I'm like, it's an easy way for us to be helpful. It's no extra effort. So yeah, that's kind of how I'm seeing things evolve in real time here.

You mentioned clean cap tables there. It's kind of an inside baseball term. It matters. Why does that matter to founders?

Well, it's more admin and work for Karna or whoever's managing your cap table. It's easier as you get to future rounds and have more success and are figuring out pro rata or who has what rights going forward. And just generally speaking, the fewer folks on the cap table that you need to get sign-off for this, give pro rata for that, whatever it may be, the easier for you. So I can get into potential concerns for investors who can't necessarily make those decisions, right? So say somebody does do a roll-up vehicle, They all come in through one specific vehicle. They're not necessarily the decision maker on that vehicle. So when it comes to, are we going to take pro rata? Yes, no. Like, how do we get pro rata? Like, they just lack some of those decisions, which I think is, I don't know, in some ways, depending on your check size, something you just have to live with as an early stage angel investor or a smaller investor that is just excited to back your friend who's founding the company or whatever it may be. So yeah, there, there are some nuances there, but again, I think for these founders, like keeping the cap table clean sets you up for more success going forward and less, less potential headaches when you get into more complex funding rounds and figuring out pro rata and rights for whatever direction the company goes.

What's the state of syndicates today? Generally in venture, it's a tough market. Curious what you're seeing at the syndicate level.

I would say they are. So speaking from what I see in my hands-on experience, I would say rising in that the market is getting better. We're talking today's Thursday, October 24th. I think October has been a fantastic month, and I'm not going to say every month is fantastic, right? Like, I felt August was very slow, which to be expected in venture, end of summer. I thought the start of September was slow in just terms of deal volume and LP interest. And I was kind of upset about it, right? Like I always want to be in the driver's seat and things moving forward and month over month growing. But luckily October, I feel like there's a lot of deals that are trying to take place and get done probably before the Thanksgiving to end of year timeframe. But more broadly, syndicates kind of follow just the traditional venture market, right? So There were a ton of syndicate leads who entered the market in maybe 2020 and were riding high through 2021. Tons of LPs deploying capital, tons of syndicates running deals. Everyone was getting deals done. Obviously things were overvalued. And then there was a very sharp turn, probably end of Q1 2022. And I think that was a turning point where It was a lot harder to be a syndicate lead at that time. First off, there were just not as many deals being done in venture, so there's fewer looks for you. Even when you had a good opportunity, I mean, a lot of LPs just fell off the venture market, weren't deploying, so it felt very hard to get deals done. And I think that timeframe kind of just knocked a lot of syndicate leads to the sideline. Like folks probably got frustrated, They were used to it being a lot easier. Things weren't working. So I think a lot of folks kind of left the ecosystem there.

And probably aren't coming back.

Probably aren't coming back. Yeah, I would definitely agree. I mean, it would be hard to restart. I also think it just kind of, I don't want to say shows your true colors, but like, if you couldn't get it done, then maybe, yeah, you shouldn't come back, you know, not to be too harsh, but, uh, um, whereas Yeah, 2022 was generally rough. I think 2023 also like not the best time in the syndicate ecosystem. Pretty hard at like, like we probably deployed the most in '21, went backwards in '22, continued backwards in '23, deployed a lot more this year than we did last year and potentially '22 as well. I need to double check. So I, but like, I guess, yeah, if we look at it kind of macro level there, I think things are back on the up. I think the venture market at early stage is doing well. There's a ton of like zombie companies and what used to be considered high-flying companies that I think are in really tough positions that are maybe kind of sidelined for the venture market to do up rounds. But yeah, also if you're— I think it's also a great time if you're interested in running a syndicate. getting started now. Like we've seen this reset. I don't feel that valuations are as crazy as they were. I mean, there's the kind of AI, which is its own category that we're seeing a lot more inflated valuations, but some of those companies are probably justifying them. But yeah, I would say really exciting time to be getting started here. And I think the next 5, 10 years ahead for venture, while there will be longer paths to liquidity. If we're thinking about like the IPO market and the speed at which folks are raising follow-on rounds, I think that will move a bit more slowly. But I think starting companies and investing in early-stage companies right now is an exciting time, and I think the years ahead will be healthy. So for me, it even felt like a bit of a restart in getting into a lot of earlier-stage companies after this, this ZIRP era. at better valuations. So we shall see, but hopefully I'm right.

Time will tell, but I think it's a pretty strong thesis. And obviously if you're running syndicates, there are fewer deals, as you said, to work your way into. But generally when you're trying to get into something, it's less competitive, valuations tend to be friendlier, and it's easier to get allocations. So all that directionally aligns with better performance.

It's a good point. Like I am seeing rounds that move super quickly and We're too late to the punch and we can't get into it. And I think that's good. It shows folks are— VCs are aggressive, but at the same time, not at the way we saw that in 2021. So it's funny, like I'll have a lot of founders, you know, founders, they gotta do what they gotta do. They're trying to build FOMO, get the round going and get people to get to the table and commit quickly, which, you know, I do the same as a syndicate lead for my LPs, right? Because timing is of the essence. But at the same time, I also can call BS quite a bit on, on how quickly rounds are, are actually going to move and get fully subscribed. So I think that's, that's nice as an investor to have a bit more influence on, on getting into rounds here.

I can picture those conversations. So it's a Wednesday and they're like, yeah, we need a, you know, firm commitment by Friday. Things are coming together pretty quickly. Okay, well, it typically takes me like 10 days, 2 weeks to go through my process. Oh, well, we can work with that.

Exactly to the T. I'm like, I'm like, okay, I've, I've no hesitation to, to pretend to work within a 2-day timeline. So I'm like, let me just be transparent and see what they have to say. And yeah, for the most part it's like, okay, yeah, that could work. So keep doing that.

The nature of syndicates, it's, it's different from a fund model where, you know, with a fund, every investment in the fund, they're all naturally going in the fund. With the syndicate, you're putting your own capital in all the syndicates, but you're also Essentially, you're into the individual deals, but what you're offering to followers of the syndicate is they choose deal by deal where they want to participate. How do you think about that balance of giving LPs a range of options, but also keeping a quality bar high so that you're not trading too far on giving them a lot of options, but keeping that threshold that you're still excited to be in deals?

I think the way you phrased the question is exactly right. Like we are always striving for the right balance. It's probably an ever-changing thing. Like I've got my own thoughts that may differ from other folks, but look, if you're an individual investor, you're investing in venture capital, you really need to take a portfolio approach. You have to build a 20+ company portfolio to optimize your chances for those outliers, those fund returners, if we're Investing out of a fund. And a lot of folks get it, a lot of folks don't get it. And in order to do that, if you're going to be an angel or an LP in syndicates, you just have to figure out kind of on an annual basis how many deals do you want to do and how much capital do you want to deploy per deal. I'm not saying every deal has to be the same amount of capital. So I think that's important for us. Look, we're definitely doing a high number of deals per year. Like I'm probably investing in 50 to 70 deals a year, or sorry, running 50 to 70 syndicates a year. Sometimes we'll co-syndicate other folks' deals. And that context matters for these folks, right? Like they don't look at a syndicate lead as every deal Alex does, I should be investing in. I think that would be a little crazy. I think you should be looking at me as, okay, Alex is very good at sourcing deals, and I should read through the deals that he's sourcing and he's excited about to figure out what are the 3, 5, 10, 20 deals that are a fit for me this year. And you really have to read through the deal materials to figure out if you're excited about the opportunity, if you like the category, if the stage makes sense to you. I am of the belief that it makes sense to syndicate a lot of deals because this is not investing out of the fund. This is me providing opportunities for folks to see. They're probably going to be passing on most of the deals we do, but at the same time, not every deal's going to be a fit here, right? Like we still have, I mean, like the 3 main points of criteria. I wouldn't say this is the only criteria, but the 3 main points or lenses that we look at deals through are first and foremost, especially for early stages, just founders, right? Like, is this person or is this team well positioned to launch this business? Do they have what it takes? Is their previous experience relevant? Do they have some unfair advantage as well? And then we have a heavy focus on co-investors. We don't lead rounds, we don't set terms. We do want to kind of use some filter to focus on other investors that we think are super high quality, have tier 1 brands, and generally speaking, have returned a lot of money to LPs and have done great deals over the years. So that's always important to us. And I think that comes out through LPs as well. Like they understand that they also want those deals and it's like there's not many opportunities to invest alongside Sequoia, Andreessen Horowitz, Kraft Benchmark, whoever it may be. as an angel. So syndicates are a really good opportunity for that. And then there's obvious traction, right? Is this business growing at what pace? Is it justified on the valuation and kind of the given market? So those are, again, not the only things we look at, but those are like the main 3 things that we're always going to look at and see, hey, does this meet the bar to syndicate? And like, are we excited about the team and the opportunity? So hopefully that's a reasonable way to explain it, but Again, as you stated, it really is the right balance. Like we want to provide a lot of opportunities to engage folks, let them see enough deals so they can figure out which are the right ones for them. But then at the same time, yeah, we also want to keep a high bar and make sure the deals that we're doing are similar to deals we would do if we were deploying out of a fund, given that the structure is different, which I like, I kind of joke about. I'm like, As a syndicate, I'm not managing any money, but I also can do as many deals as I want slash the LP base support. So it's like, don't manage any money, so I have to go out and find it every single time. But we also have a large LP base and various interests that could allow us, like my partner Zach will do over 100 deals this year. Not many VCs will do that. So It is definitely a unique place to be in this syndicate ecosystem.

What's something you've changed your mind about in the last couple of years?

There's always people like pitching ideas and like, oh, my friend should do this, or this would be a great product, or this would be a great idea. I don't care about that. I care about people, the founders, the builders. That matters infinitely more than anything else, right? And I have got great examples of Really good founders I backed that the concept they pitched and I invested in wasn't a great concept, and they figured out how to pivot and find something that was better, and now they're off to the races. And then on the other side of the coin, there's founders maybe who weren't the right fit that I backed that I thought this concept or this idea or this product made so much sense and it needs to exist. I think I've learned this a lot more by being hands-on and investing actively over the past 5 years, but The founder, the person behind it all just matters so much more than anything else.

What's a conventional view in venture that you think is BS?

I think everybody like overstates and emphasizes being value-add, like being a value-add investor. I'm not saying you shouldn't be a value-add investor at all. You should. Founders want that. Founders need that. It's helpful. But I just think like understanding your position as an investor and where you can add value and like where it's meaningful is important. And I think a lot of folks overstate it, including myself. So early on, I feel like, you know, I didn't know much when I got started investing and I was, I don't know, I just overpromised on, I could be helpful with this, I can be helpful with that, making intros, finding customers, go-to-market strategy. Finding partners. Whereas a lot of times, like, I don't think you need to do— again, I'm speaking from a syndicate perspective, not like a lead, uh, an institutional investor.

Which is a good point to differentiate. I think sometimes in these conversations people don't delineate those things, but they're very different propositions to the founder.

I'd like to think we've better understood our role as syndicates And figured out like where we can be helpful. And like founders are out there busy being pulled in many different directions. I kind of want to let them run unless there's something that I think is really helpful. Like, you know, there's a partnership intro or obviously an intro to customer or helping with fundraising. Like those are the things to me that I'm like, okay, they're meaningful when we can be helpful. Let me jump right in and try and be helpful. I don't know, everybody's always talking about how valuable they are without like context of what they're actually doing. And I think a lot of founders hear this and expect investors to be more helpful, whereas I think I've become a lot more understanding of like, as a syndicate lead, the role we play. And I don't go into these meetings on overselling. I try to understand what they're looking for. And a lot of the times I literally will ask, I'll say what, like one of my last questions with a founder will be like, hey, what does a value-add investor look like in your eyes based on the context of the round? Right? Let's, again, let's say the same example. It's, they're raising a $5 million seed. The lead's doing $2.5 million. There's now down to the last million. We want to do a couple hundred grand. And I know that, you know, there's sub-a-million or hundreds of thousands left in the round, I'll just ask 'em like, hey, for this size investor, what does value add look like? And then we can have a pretty good discussion there. Like they'll explain it and I'll say, great, I can be helpful with A and B. Or I'll say, you know what, a lot of those things I can't really be helpful with, but the one I can be is this part. Or it's like transparently, We'll probably just be investors and not all that valuable. And I just think that's way better because it just sets the bar accordingly versus the old me 5 years ago saying I can be helpful with all these things and then I'm not as helpful with all of them going forward. So it's like I'm underselling myself upfront and ideally delivering or overdelivering versus the conversation at the pre-investment stage.

What's a pocket of venture today that you're excited about? And that could be industry, could be stage, but a pocket slice of the market where you're really happy to be looking and putting money to work.

I personally, I like very early stage. I like B2B SaaS. I like backing founders where I'm like, this business is unproven, but this founder or this team is the right fit to do this. Like, that's the most exciting to me. As a syndicate lead, we're seeing a lot of LPs, and this isn't crazy. We're seeing a lot of LPs that are interested to put more capital to work into a lot of these like later stage growth stage deals. And I can understand that, right? It's hard to invest at seed. Of course, the upside is out of this world large, but at the same time, I'm sure a lot of folks have done that. All the companies they invested in sounded exciting at seed. maybe haven't panned out the way they wanted to or expected to. And therefore they're like, hey, it would be really nice to invest the same smaller amounts of personal capital in some of these later growth stage deals that are post-product market fit, have real traction, have real revenue, and it's a shorter horizon to some liquidity event, you know, instead of the 10+ years from pre-seed seed. So I understand that a lot of LPs in our syndicates are thinking that way. I still might be more excited about the pre-seed whatever deal I'm doing, but because there's a lot more LPs interested in those deals, like it's motivated me to try harder to source more of these later stage opportunities where I guess I would say I share some of the LP enthusiasm on like, you know, I've been at this for 5 years, I've got a ton of great markups and I'm bullish on my portfolio, but There's still years ahead for me to make money to confirm that getting into venture and playing this game was meaningful financially for me. So I'm on that journey and I think, yeah, leaning into some of these later stage opportunities is exciting to see these higher likelihood of positive outcomes, even if it's not the 100x opportunities with shorter liquidity timeframes. And then the last thing I'll just say there is I also think it's unique for LPs to invest in those companies because it's like syndicates really, I believe, are the right avenue into these deals. Like your $10K, $25K, $100K, even like $250K individual check might not be able to get into that Series B, that Series C at a $100 million round or $500 million round.

Elon's not returning your call about a $10K check into SpaceX.

Exactly. Long story short, the syndicate model with the right allocation to those companies is a unique avenue for these individual LPs to get in.

Cool. Well, look, this is a really interesting conversation. It was fun. Alex, thanks for coming on the show.

Absolutely. Appreciate you having me.

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