Charles Hudson of Precursor Ventures - Venture Unlocked 002

Hi, this is Samir Kaji, your host of the Venture Unlocked podcast. And on this episode I'll be speaking with Charles Hudson, the founding partner at Precursor Ventures. Charles started precursor in 2015 after five years at Encore Capital when he saw a unique opportunity to invest in companies at their very earliest stages of development. Since starting the firm, he's invested in over 150 companies, making precursor one of the most active pre seed funds in the world. On the podcast, Charles shares with us his challenges in raising a first fund, the early mistakes he made in positioning the story, how he thinks about the various components of running a firm, and why diversity is such a critical part of entrepreneurship. Now let's get into the episode to hear all of this and more.

Charles, thanks for being on the show.

Thanks so much for having me.

I am so excited for so many different reasons and there's a lot of things that we're going to do a deep dive in. But before we get into that, would you mind just going through your background and really your journey as an investor to founder to investor again?

Oh, of course. Happy to do that. So I'm originally from Michigan and moved out here to California for school, thinking it would be a short detour, and went to Stanford and graduated into the tail end of Internet 1.0 in the late 90s.

And ended up working at a company that's no longer with us. And while I was there I met quite a few folks and one of them happened to be really closely connected to the team at In q Tel, the CIA's venture capital group. And as I was graduating and trying to figure out what I wanted to do next, I ended up deciding to work at In Q Tel. Had a really amazing experience working there. I was there for about three and a half years, went back to business school and came out feeling like I really wanted to try.

More traditional operating experience and working in companies before going back to investing. So worked for a company called Ironport Systems that was later acquired by Cisco, worked for Google for a couple of years in a variety of biz dev roles, ended up joining two different games companies, Gaia Interactive and Serious Business. Did that for a while and then towards the tail end of the my time at Serious Business when the company got acquired by Zynga, I decided I was going to start making a move back toward investing and chatted with a handful of folks and ended up working with Jeff Clavier at what was then Softech but now on Cork. And when I joined it was a little tiny then two person firm and he'd just finished really deploying his first institutional fund and was gearing up to raise the second institutional fund and was thinking about expanding the footprint in the franchise and so worked there for five years and then started precursor almost exactly five years ago to the day.

And when you left Uncork. So you had been there for five years, joining at a time when seed investing was pretty new. There was very few emerging managers. You had built a nice reputation within uncorked brand or at least SofTech back then. What was the mental framework of looking to hang your own shingle? We do see spin outs, but what was your mindset in terms of starting your own franchise?

I looked at the ecosystem and it felt to me like when I started as a seed investor in 2010, a lot of the checks we were writing and the rounds we were doing, those would be called pre seed rounds today they were below a million dollars. It was usually one, maybe two institutional funds participating, a handful of angels, pre launch, pre product market fit companies.

And it really felt to me like.

That was like what we did well. And I felt like while I was there, whether it was the series A crunch, you know, causing seed investors to worry more about financial Runway for seed companies or whether it was seed managers converting their success into larger fund sizes, the longer I was a seed investor, the more I felt like we were drifting away as a group. And this wasn't just an uncorked thing, just the managers who'd been successful were drifting away from this. Take a risk on people you don't know, pre product market fit style of investing to something that felt more like it was a reasonable ask to see a product and to have some early data and some usage. Which isn't to say that seed investors still don't take risk on unproven people. I just feel like more and more seed is not the first place you go to get capital for most entrepreneurs. And I just felt like I could build a firm that would do the work that I enjoyed most. And I feel like when you're in $100 million fund, if you're excited about running 250k checks, that's not a very rational check size for a fund of that size.

And you and I have talked about this and this may be surprising for a lot of people that are listening right now, but the first fund that you raised back in 2015 was a long process, a grind. Tell us a little bit about the journey of raising that first fund. Despite the fact that you weren't really a first time manager, it was really Difficult.

And I think in some ways, starting a fund is kind of like starting a company. You have to be naive enough to know that, to not know how hard it's going to be. Otherwise you probably wouldn't do it. And I can tell you in retrospect, I'll just tell you how I positioned Precursor Fund one and Sumir, you've been doing this for a long time. You've talked to literally thousands of managers. And I'm sure you'll understand in a way I didn't in the moment, how radical what I was proposing was. I basically went to LPs and said, Listen, all of these great seed managers that you've backed, your first rounds, your freestyles, your uncorks, let me tell you about something they're not doing. There's this tier of entrepreneur who's too early even for your seed managers. And I know it's taken you 10 years as an LP to get comfortable with the idea of seed. Now I'm going to blow your mind and tell you that there's a whole new thing called pre seed. That's the round before seed. It's going to be a single GP model, which is not super radical, but we're going to do 25 or 30 companies per year with one person. And we're not going to be focused on ownership, we're going to be more focused on entry price. And we think that we can yield a fund that will be competitive from a return standpoint with the other things that you do.

And if the today me, we're Talking to the 2015 ME pitching precursor, I would have told the 2015 ME, this will never work. You will never get institutional LPs to believe in the portfolio construction or the basic hypothesis of the fund, which is that seed investors, which I think until very recently were the first round of investment for most companies have a blind spot or have a set of entrepreneurs who are too early for them. And so most people just said, aren't you going to end up with the very worst companies? Aren't you just going to get the adverse selection of the stuff that the really good seed funds don't want? Like, I don't have any model for the kind of company that you're talking about. Then they said, even if you're successful, won't the size of your portfolio and relatively low ownership, won't it just destroy your returns? You're not going to own enough of your best companies to be successful.

There were more elements of the model that were even more aggressive, which was very light Reserves. We would use SPVs for the companies that broke out. I'd say all of the things that I thought were innovative and groundbreaking and cool. Most of the people I pitched found them terrifying.

When you had those conversations. Conversations and what we often find LPs want differentiation, but not too much differentiation. And you did launch Precursor back in 15. You mentioned the different portfolio construction. Pre seed being a solo gp. What would you tell other people that are pitching non traditional models?

Sometimes people give you really simple advice and you don't realize how profound it is. I'll never forget this. I sat down with Mike Maples to walk him through my deck and I hope he won't mind me telling the story. And I walked him through and he said, this is all backwards. I said, what do you mean? He goes, you have all of the really innovative scary stuff at the front and all the really normal stuff about your fund at the back. He's like, you should totally flip this around. And he was right. My fundraising got a lot better when I inverted the story and said, these are all the things about what we're doing at Precursor that should make sense to you. We are looking in mostly geographies where you believe good companies can be found. We're going to be reasonably disciplined on price. We have some notion for our portfolio construction model that we think will work. Here are some historical precedents. This looks a lot like the early versions of the seed funds that are now $100 million is what they look like when they were smaller. By the way, this angelist and portfolio construction stuff that should be at the end. And I thought all the things that were innovative would be a selling point to LPs. They weren't. They were things that had to be explained and understood and they were scary. And I think if I had highlighted the things about the fund that were very traditional in terms of management fee and operating structure and general plan and belief about how we would get to returns and then said, oh, by the way, there's a couple of things that we're doing differently. I think my pitch would have been received much better. And instead I think probably the first hundred people I pitched probably thought, wow, that guy's crazy. He's really asking me to buy four or five really difficult to swallow hypotheses all at once in order to invest in a sub 25 million dollar fund.

Right, we do see that. And I think that's a really common experience that a lot of folks have. The other thing that I really wanted to dig in, you mentioned this great story about Mike simplifying the story. And you said that's when it, the fundraising started to accelerate. What was the tipping point for you in terms of when you started to see LP interest? How did you get to that first close? Were there certain catalyzing events during that fundraise that really got you over the hump?

If I think back on it, it never really felt like there was a tipping point until the very end. And I was fortunate. Our first commitment came from Mitch and Freda Kapoor. And I had known them for a long time and we had been talking for a while just about how to address some of the things that were frustrating both of us, I think, in the venture industry. And they committed early and did what for me at the time was a meaningful portion of our fund. And they did it in spite of the fact that the story and pitch wasn't perfect. And for me that was important to have the confidence to know that I could convince somebody that I know to write me a check that was meaningful in the grand scheme of our fund.

Mostly honestly, Samir, it felt most of the time like there was never going to be a breakthrough. There were long stretches of time, I think, especially when you're doing this for the first time. You know, I had some LPs, people like, oh, it must be great being a spin out manager, you know. You know LPs. Well, I knew LPs, but they mostly knew me as Jeff's partner. And Most of those LPs had come in and fund three, so they weren't really the LPs that you would think of as your anchors for a first fund. So on the one hand, I had all of these great people who could give me feedback and advice on the pitch and like tell me about going and finding family offices or more appropriate LPs, but none of them really planned to invest in my first fund. And I probably went 40 or 50 meetings in before I realized I'm talking to the wrong people. Not because they're bad, they're great LPs, they're just not likely to do my first fund and then I had that sort of classic GP moment of panic, which is like, well, if all the people I know aren't the right people, how do I go find the people to help me? Who are the right people and where are they? And for that I'm eternally grateful for the many, many GPs who extended themselves sent intros on my behalf, or at least pointed me in the direction of where I could find the right set of LPs for our first fund, we ended up having 56 LPs in the first fund, with the majority of them being other VCs, individuals. And we had one brave institution, one brave large family office and a lot of friends at Charles.

You said 56 LPs in the first fund, which seems like a reasonable amount for a first fund. In fact, sometimes we see much more than that. How many LPs did you end up talking to in the raise for Fund one? We had Elizabeth Yan from Hustle Fund on the last episode and she and her partner Eric talked to, I think 700 LPs. Do you remember how many LPs you talked to? And how did you just maintain some sanity managing all those different conversations?

I did about 300, I want to say. And the only reason I stopped was I just ran out of people to talk to. If there had been more LPs to pitch, I would have pitched them in my. I think our fund one process, soup to nuts, was about 20 months.

And if I'd had another hundred LPs I would have continued to pitch. We just, we didn't, we didn't have more names at that point. And the vast majority of people said no and said no fairly quickly. What I can say is Fund two was less time, more money, slightly fewer LP pitches. Not appreciably, it's more like 18 months. But it was twice as big of a fund and we culled the list a lot up front and just said, hey, these are people who just seem to not get it at all about what we're doing. It just did not land. I don't think more time in the seat is going to bring those folks around. And here are some other folks where it felt like they liked me or they liked some element of the story, but they wanted to see more data. We should absolutely go back to those folks and see if they're open to it.

We touched on the startup precursor and being a solo GP, which some LPs at least at the time, were fairly reticent. And the whole thought is you want diversity and investment decisions. As a solo gp, how do you manage your day to day? So you have all the top of the funnel investment opportunities, especially the way you construct your portfolio, plus all the other things you do. How do you manage that and when did you determine it was the right time to start bringing people on?

I didn't think the solo GP thing would be as much of an issue with LPs and it's an interesting topic. I guess what I've come to believe is we have enough successful solo GPS out there, whether it's Steve Anderson or Manu Kumar or Tim Connors or Michael Dearing, that if you're open to the idea that solo GP can work, there are proof points you could point to. If you just don't like it, you think it's too risky, Key man risk or single decision maker risk or whatever. There's a million one reasons why to say no. What I decided for Precursor and again, I got some good feedback from one of my friends was like, look, if you're going to be a solo gp, just don't apologize for it. If you spend five minutes explaining to me why solo GP is totally fine, you spend all this time in your pitch convincing me. It sounds defensive, not confident. So if you really think that being a solo GP is the right move for Precursor, then like just do it, but don't feel the need to apologize for it or explain it to people. So there's a lot of people I met who are just like, hey, we would never put our clients in a solo GP fund. I'm like, okay, well then there's probably not a lot for us to talk about. The way I think about it is we're investing in pre product market fit companies. There's no data to evaluate with your partner, there's nothing to like analyze. It's basically the person and the idea.

And I'm not convinced that more idea, like more eyes on these companies at this stage actually improves your decision making. And so the experiment I always run with my LPs is I'm like, okay, we're running a 250k check.

Speed is an important part of our process and it helps us win and get into competitive situations. Having a single person being able to make the decision. If I had another full partner and we decided that we were going to look at everything together, it might take me 3 weeks to decide to write a 250k check. There are many other people who can write a 250k check in less than 3 weeks. And so I think you always have to think about your process relative to your competition. And if your competition is angels, you need to have a process that looks and feels more like an angel process if you want to be able to match the competition and timeline. If you're a big seed fund that likes to write a million and a half dollar check, you just need a process that's good relative to the people who write the same size check. And so I really think if you're going to do these very low Data, high conviction style of investing. I think a single decision maker works fine, especially if you're not taking a ton of board seats and you're not promising your portfolio companies that you're going to be sort of a virtual co founder in the office with them a day, a week, committing code and GitHub and marking up wireframes. There are lots of great firms who do that work. We don't. And I think for us, at least for me, to date, solo GP has been effective in squeezing into some really competitive deals. It also simplifies things for me internally because I've chosen 99% of the companies at Precursor. I don't have the like, oh, that's my partner's company problem, where it's like I don't know anything about what's happening in that company because I'm not responsible for it. But we did hit a point in Fund one where I felt like we needed more people and I needed help. So we brought Sydney on about four years ago.

And that's been great. She's done a fantastic job. And about a year and a half ago it felt like we really could have used more help as she started to become more of an externally focused investor. So we brought in Ayanna as our first analyst and you know, we'll continue to grow the team. We'll probably get to four or five people when it's all said and done. I right now personally am in the final stages of bringing on a part time CFO to help me, which would take some of the load off of my back.

Before you brought on Sydney and Ayanna, how did you manage the top of the funnel though? So you mentioned speed and being expeditious in terms of investment decision making, which is great, but what was the day to day like and what would you tell somebody that's a solo GP starting up? How do you spend your time and what are some hacks maybe that you learn to be able to scale?

I think the sort of non intuitive thing about being a solo GP is everyone wants to talk about the investing side. I tell everyone, look, a venture fund is really three different businesses all bundled together. You have a capital raising business on your own, which is raising money from LPs. You're running a small professional services firm like a law firm, basically. You've got payroll people, you got to pay vendors and things like that. Then you've got the part that everyone thinks about, which is selecting and supporting companies. You actually have to do all three of those things and you have to do all three of them well. Which means there will be times when you feel the zero sum math of fundraising, running the business and meeting companies like you can't do all three. So the thing, the thing I always try to do is to figure out, okay, given what needs to happen for the firm, what's the most important thing to do? And sometimes when you're fundraising, I've learned this now having been a part of enough fund related fundraises. We generally slow our investment pace down when we're fundraising because the serendipity and the sort of the need to be responsive when you're fundraising for a, for your own fund, it means either you will be less reliable to the companies you meet, like you'll end up canceling because you got to jump on some due diligence call all the time or you'll not do the fundraising. It's justice. And you'll end up trying to squeeze fundraising in around company selection. So I think part of it is being realistic about what you can do. And we use a lot of software at Precursor and like software can help you. But a lot of what I try to do is just measure where I spend my time. So my admin and I once a week look at the totality of the meetings that I take, who I talk to, what was the split between our existing portfolio companies, new opportunities, things like that. And I have sort of a rhythm. I'm looking to hit about 50% of my time spent with our existing portfolio companies, about 25% of my time spent meeting new companies and 25% on everything else on steady state. That's pretty achievable. You know, sometimes things in the portfolio spike and that number goes way higher. Sometimes the portfolio is quiet and I have time for new deals too.

I think that's really helpful for anyone starting and you've now been a solo GP for five years. What are the things that people should be looking at? How did you think about constructing the team? How important is culture? And how did you set that early on defining the true north of Precursor?

It's something I spend a lot of time thinking about. So, you know, we went through this values exercise at Precursor and we do it periodically. And one of the values I realized is really important to me is this idea that Precursor is a good place to start your career as a venture capitalist. So I have a very much a philosophy for our firm that the people who invest our firm's capital are likely to be grown internally as opposed to brought in from the outside. And part of that's because, you know, our portfolio construction, our pace, it's very different than what you're likely to find at any other firm. Maybe, like, if you came from Hustle Fund, maybe you'd think Precursor slow, I don't know, or Kima or something like that. But I think for most people, the way we invest would be a real shock to the system if you're used to doing two or three investments per year and taking a board seat. And.

I think the time required by me as the manager to sort of convince somebody that there's another way to invest the way we do it, and then to convince that person that they should buy into the way that we view the world, I don't really know that that's going to work. I would much rather take really smart, talented, curious, optimistic people and spend some of my time as the GP helping teach them the business of venture capital. I enjoy it and I. And I believe that smart people can learn this business quickly. It is very possible to do so. And so we mostly hire the way that we invest, which is I'm looking for personality traits and attributes, not necessarily resume. And so I'm always looking for people who I think are going to make Precursor better by being additive to the culture and also seeing if they can bring something, a new perspective. So, you know, for the last few summers, we've been having historically black college and university summer interns. And a lot of those interns we've had have brought really different professional and personal networks to bear on the firm. And they've exposed us to entrepreneurs who are not part of our social network, who are working on different kinds of problems. And I think to me that's a plus. Like, we don't need another me at Precursor. We already have one. Like, that's plenty of. So I'm always looking for people who I think kind of embody our core values, really, which are around, I'd say, like optimism. Like, that's one of the big ones for me, that the future can be better and that we can have a role in bringing that future to bear. But I really do think optimism is a big one. And I try to make sure that we're hiring people based on traits. And I want our firm to be a good on ramp for people who might not have otherwise seen themselves as venture capitalists.

Another angle here that's really unique about the way you've built your firm. I mean, there was a study that was back in 2018 where they looked at the backgrounds of venture fund partners and employees and they found only 3% of the employees were African American. Precursor is a decidedly a massive exception to this as the entire team is African American. As you think about the team now, what are the structural advantages that you've seen having diversity like you have on the team? And why should LPs be spending more time thinking about it?

Yeah, I would say it's not intentional, but it's also not an accident. And what I mean by that is I really felt like there were talented black people who should be in venture capital because they have the aptitude and skill set for it. And one of my beliefs was, well, hey, if we can get good as a firm at teaching people the business of venture capital, the way we practice it, a precursor, then we'll be able to hire from a gigantic pool of talent. So I think of this as like an operating skill for the firm. If we're good at getting people up to speed on how venture works. And I think we're pretty good at it now we've run the experiment, we're on our third experiment now, and each one seems to go a little faster than the one before. As I get better at learning how to educate people and expose them to things, then it means we don't have to restrict ourselves. And I say this with full knowledge that I'm a two time Stanford alum. We don't have to restrict ourselves just to Stanford and Harvard alums who worked at Google, Facebook, Twitter, Square, Pinterest. We don't have to restrict ourselves to this really narrow but talented pool of people. We could go anywhere to get our next analyst or associate if we have such a richer canvas of people that we could pull in. And to me that seems like a better way to recruit is to have a really big top of funnel and go into your hiring cycle knowing that the person doesn't have to know everything about tech and venture in order to hit the ground running at your firm. They just have to be smart, positive, curious and hungry. And I quite enjoy it because it means that I think over time I could see us hiring somebody from well outside of tech and venture for our next hire. Whenever we add some of the team with the confidence that we as a group would be able to fill in that person's knowledge gaps while they get up to speed. And what I've learned is hiring people who are a little bit outside of the sort of traditional venture bubble, they look at things differently. It doesn't even matter like race or gender, like just not being deeply immersed in the world of tech in Silicon Valley. Like, you can look at things and say, this is crazy. Like, the things you guys are doing don't make any sense, or, hey, there's this whole other market that we're not paying any attention to that's really relevant in my life or in my community. And I don't understand why VCs aren't paying attention to it.

And so I'm pretty committed to it, I think. And to me, it's been great to just see how our individuals on our team have flourished, both as people and professionals. And so I'm really concerned that there aren't more firms that are pushing themselves to be better at hiring and pushing themselves to bring new voices to the table. Because I always say, like, if you've got like nine people from the exact same background, they went to the same schools and worked at the same set of companies, like, what is the 10th person going to bring you that you don't already have? I don't. I struggle with that.

You make a good point around diversity of thought. And it isn't just around gender or age or socioeconomic background, geographic location. All of those things I think do add to building a well diversified team. But as VCs think about adding diversity, you have been very thoughtful in creating diversity on your side. In terms of the backgrounds of the people, what advice would you give them? Like other big funds, small firms, how do you go about building these diverse teams and expanding the funnel of talent?

Yeah. And to be clear, as much as I think the point of view diversity at our fund is important, I do think we need more black and brown people in venture capital. Period. And part of before I talk a little bit, what other firms do, part of what I always felt like is I never wanted to build a venture capital fund that I wasn't proud to lead. I said, if we're a fund that if we can't find our way to hire black and brown talent, then what right do we have to criticize anybody else? In theory, it should be easier for me. Right? Like, I'm black, It should be easier for me. So if we can't model the behavior that we want to see in the industry, like, shame on us, like, that's an admission that would be a tacit admission on our part that the community that I come from doesn't have people that are qualified to be venture capitalists. And I did not believe that was true. So I do think that, like, racial and gender diversity are important in addition to sort of different perspectives. But also I felt the same way about our portfolio I said I would never want to lead a portfolio, be in charge of a portfolio of companies where when I look at the makeup of the people that we funded, that I'd be embarrassed or feel like I had to explain why we had so few women or people of color leading the companies we've backed. And for a lot of the conversations I have with firms that are struggling with this, I just say, look, your firm doesn't match your values. You tell me that you're liberal, inclusive, open minded firm, everybody who you funded looks the same. Those two things don't match. So either your values as you state them are aspirational and not real, or you have a firm that's like not aligned, where the things that you're doing don't match the things that you say you want to do. And if you say you want to be a firm that values diversity and inclusion and you want to find the very best entrepreneurs, I don't understand how you do that if you're literally excluding huge chunks of the population from the consideration set. And I think that's where it starts. And the thing that I find most perplexing is these analyst and associate roles. The number of people who are capable of doing them far outstrips the supply. Right? It's like getting into a top tier college. There's so many people who have the intellectual horsepower and background to be super successful as an analyst or associate, yet we only hire from a really narrow pool. And I've been telling firms like what? Like what, what's the risk in you for some of your more junior positions being way more aggressive in terms of who you bring in, in terms of diversity? Like why, why is that? Like why not start there and you might find some really amazing people who turn out to be the future leadership of your firm. You don't have to worry about, oh, how do I bring this person in as a of part partner? Like it's really scary and like that's the part of the hiring and recruiting process. I don't understand why firms are so conservative because in many places those are terminal roles. It's a two to three year role and you're either going to get promoted or you're going to like go to business school, do something else. That is the perfect place to start bringing in new people. And like, I think one of the big challenges is we live in a world that's like actually relatively segregated. And I've certainly met people in positions of authority at venture capital firms who don't have.

Black and brown people in their social and professional circles. And I think it's hard to diversify your firm if your personal and professional network is also really homogenous. So this is, to me, it's a big problem. I think the solution is to start hiring differently and do it where your firm is. If your firm's not ready to bring on a principal or a partner, start with an associate or an analyst. But I think there's no reason to me that like every look Lightspeed is big Sand Hill Road firm, they have two black investment professionals up from zero, I think a year ago. So it can be done.

Well, Charles, it's such an important topic and one that if we do it right, the end result will be better capital for entrepreneurs as we bring more diversity into funding circles with the leadership of folks like yourself, I think we're well positioned to see some real growth. And I'm excited to see that. Final question, now that you've been doing this for five years and prior to that you're part of another seed fund for five years, what is the single biggest lesson you learned since launching Precursor and that you would impart to anybody that's starting in your firm?

This is like a very recent revelation to me and I hope it gives other managers, hopefully, because it certainly has given me hope you will realize that your fund is working way before anybody else will. And it's not about markups and it's not about follow on rate. I'd say like a year and a half ago inside of Precursor, I'm like, oh, this is starting to work. Like we're attracting the kind of entrepreneurs that I want to work with. They're choosing to take our money and work with us. They're getting things unlocked with capital. And I feel like we're building a good reputation in the sub asset class of pre seed. And I was like, this is clearly working to me. But there's nothing I can point to externally that would probably convince someone who's not in the building every day that the machinery is working. Because, you know, we live in a TVPI DPI world, man. And so I think sometimes as a new manager, it can be discouraging. You're like, why don't people get it? It's so clear to me. I would just say look for the internal indicators that your models work. And for me, those were the ones like, are the kinds of entrepreneurs that we want to back, Are they finding us and are choosing us and are we able to invest in them on terms that make sense for us and for them, are they generally happy with the experience. And do they tell a friend? I'm like, if all that happens and we choose well, precursor will be fine. Like we will be fine. And about a year and a half ago I was like, this is really starting to work. And I cannot point to anything external that would convince somebody who's not inside the building. And it gave me like a real boost of like energy and like positive vibes to keep going and keep investing and keep working. Because the first three years it was very ambiguous. I'm like, I'm not sure if this is working. I know we're working really hard. I know we're doing all the things we think we need to do to be successful, but I can't tell you for sure that this is working. And now I'm like, I really believe this is working. I believe when the returns come in, they will reflect that it was working back in 20, in 2019 we'll be able to go back and say, yep, in 2019 it was working. We just, we just didn't know it yet. And so for all of you thinking about starting, just be prepared that your fund or your firm, your strategy, it could be misunderstood for five years, six, seven years. Only now, Samir, do I talk to LPs like, well of course precede is a thing. I'm like, what do you mean of course? Two years ago you told me it was dumb. What do you mean of course? When did of course happen? And so I do think it takes a certain amount of fortitude as a manager.

To stick with your strategy and stick with your idea and really focus on those internal indicators of success. Because the external ones, it might be seven to 10 years before those show up.

That's fabulous advice and it certainly speaks to the notion that this certainly is a marathon and exercising patience, not getting discouraged early by things like the, the initial fundraise are such an important part of building a long term franchise. Charles, thanks so much for all of the, the insights, the.