Delian Asparouhov, Principal at Founders Fund | Investor Intervie

All right, how's it going, everyone? Welcome to another episode of Forward Thinking Investors where we talk to investors about companies that they like, markets they like, and how they broke into Venture. Today I'm very excited to be talking to Delian Asparohov, who is the principal of Founders Fund. Welcome to the show. How's it going?

Thanks, Matt. Excited to be here. Excited to chat today.

Yeah, excited to have you on. I have definitely seen you from afar many times on Twitter. I love your presence, but I'm stoked to have you right here in this virtual conversation for forward Thinking investors. I think to start, I would love to hear Venture is this kind of opaque thing. It's not super understood. So the first thing is, how did you find yourself breaking into Venture, and how did you kind of get to the path where you're at now?

So I had been friends with this guy Keith Rabboy for a while.

We originally got to know each other because I was a Android engineering intern at Square when he was the COO there. And then as I was basically considering starting my company, I reached out to him as a potential sort of mentor through the Thiel Fellowship.

And so started off more as a.

Mentor for my company, ended up angel investing. But we got to know each other more as friends through actually his soccer team, interestingly enough. Basically complained at one of our regular lunch meetings that I wasn't getting to playing competitive enough soccer games on the weekends. He was like, well, I actually run the most competitive soccer team in San Francisco. Would you like to come play with us? And so that was actually how we sort of got to know each other. And then the way that I sort of got into Venture from that was about four years ago. We actually had dinner and we were discussing one of my friends who had dropped out of Harvard around the same time that I dropped out of mit. And we had actually been roommates for a while. He decided to actually go back to Harvard. And Keith had gotten to know him sort of like through me. He decided to go back to Harvard, had graduated, and was sort of considering what to do. And Keith at the same time was considering basically hiring his first chief of staff at Coastal Ventures. And so during the dinner, you know, mentioned that my friend was coming back, asked Keith if he had any recommendations for roles for my friend. Keith's like, actually, he would actually be a great fit potentially for my chief of staff. And I was like, okay, great. Let's talk through. How would I pitch this to him? What would the role of your chief of staff be? I'M sure he'd be interested. So we ended up talking about it for 30 or 40 minutes. And then I called my friend, basically finished the dinner with Keith, literally hopped in my car right outside Keith's house and just sat in the car and basically called my friend and pitched him on the role for 30 or 40 minutes. About 30 or 40 minutes in, I realized I was like, oh, shit, I want this role. I was in the midst of deciding what I wanted to do next as well. So I literally knocked on Keith's door 40 minutes later, and he's like, what the hell are you still doing here?

I thought you went home.

And I was like, remember that? Keith Chaprol. What do you think about me doing it rather than my Harvard friend doing it? He was like, great, I'm in. I'd love to have you. And so his request was just like, I don't think you wanted to or planned on doing Venture or anything in the early stages of your career. And so his request was like, please just do it for a year at least at minimum. Don't leave before that, since it'll take me some time to onboard you and sort of train you in how to help me out. And so, yeah, the original plan was I just wanted to basically learn from Keith and actually use that as sort of like a launchpad to co found my next company.

And then about sort of six to nine months in, through a handful of sort of like, small signals and interactions, realized that, like, maybe the world of venture was better suited for me than going back and co founding a company. One aspect of it was realizing that my sort of personality and skill sets and the way that I work are just like a much better fit for the world of venture than the world of being a founder. I'm just. I'm super intellectually curious. I'm super add. I like jumping around between a ton of different things. Like, I'm energized by context switching. All of those things are like, you know, strong pros as a founder, as a vc, versus, like, they're huge cons as a founder. And so that combined with the fact that I basically was able to relatively quickly and, you know, honestly, somewhat anomalously and very lucky in some ways, able to actually source companies into coastal ventures. That's where Keith was at the time, and that's where I was chief of staff. And I was basically able to source a handful of companies in my first nine to 12 months there. And so I was like, whoa, maybe I should be good at this. Honestly, if you asked me at month 12, I was like, great, I'm going to be sourcing a company every three months we invest in. Lo and behold, I did a company at month six, I did a company at month nine, and the next one wasn't until month 26. So there's a 15 month dark period there. Really wasn't able to find anything that I was super excited about. But I was like, maybe I'm actually better at this than I expected. And then probably the third and most important point was the long term goal that I'd always had was to get involved in the commercial space industry. But the path that I thought that was possible was you had to do it the same way that everybody from Elon to Chamath to Jurvetson to everybody that's been big in Silicon Valley that has done space stuff. It's like you get successful in normal Silicon Valley stuff and then you use your capital to do space stuff. And so I was like, okay, I have to do normal Silicon Valley stuff for a decade or two, get successful, and then, then I can do space versus. One of the companies that I sourced early on was actually a commercial space company. And so I ended up finding this like, you know, magical short circuit where I was like, oh my God, this is amazing. And like my like early young, energetic, ambitious years, I'm getting to actually influence space today, not like, you know, two decades down the line. And so I was like, man, I should really lean into this. Like, you know, I get, I'm getting immediate gratification and maybe I can actually have even more impact on space because, like, you know, this is a particularly interesting time to be, you know, investing and working in the commercial space industry. And so, yeah, I mean, I kind of ended up that early bet in decision to year one, basically told Keith like, hey, I actually want to do this. And the way that I want to do it is not just be your chief of staff, but I'd like to actually eventually become an investment team member at Coastal Ventures. What do I need to do to do so? And sort of steadily made the transition and was very grateful to the folks at Coastal Ventures, including beyond just Keith, that were both willing to let me do so and mentor me through that. And then now, four years down the line has played out to the extreme upper end of my, let's say, expectations, both in terms of the things that I've gotten to do as a vc, but then in particular the thing that I care about the most, which is the ability to have impact on the commercial Space industry in that I've been able to lead several rounds of companies, but then most importantly had this idea that I had been thinking about for almost the past now decade, which is the industrialization and commercialization of low Earth orbit beyond just communication and imaging satellites. But the thing that I think is actually much larger, which is low Earth orbit manufacturing. And so over the past six months here at NOW Founders Fund, the new venture firm that I'm at, have been able to basically put together an incubation called Varda that I'll be sort of speaking more and more about over the coming years that is getting to tackle that problem because I sort of recognize that sort of nobody in the market was really going after this problem. And so, yeah, it was definitely somewhat fortuitous. I wasn't really planning on it. It was. I can entirely claim that it was just the reason I even had the opportunity was because I'd gotten to get friendly over soccer with Keith. But I'm very grateful for how the sort of past four years have gone. His mentorship and the mentorship of a variety of people in the venture capital community.

So I feel like when a lot of people want to break into tech or startups, they want to build a social networking app for college or they're interested in, you know, building like the next Spotify music social app or something like that. But your interest is space, which is, you know, different. And you're actually the first, you're the first person that I've ever seen on Twitter actively talk about, like, your love for space, which actually inspired me to watch some videos and now I kind of like, see what's going on there too. But my question for you is how, like why space and when space. When did you realize that space was an industry that you cared a lot about? And how did that kind of love for it change over time as you spent time as an investor and now as a founder and investor?

Yeah, I mean, the love for space stuff was just, I can't even remember as like a kid. I mean, I grew up in like a heavily Eastern European, deeply technical, mathematical, scientific family. And so the love for space was a sort of like engineering love for space about the complexity, the problems you have to go after, the extreme environment, and then the belief that sort of the net benefit of focusing on space is extreme for humanity. Right. Everything from the world of solar panels to kind of even had a Twitter thread today where it's just like, if you want to slide climate change, you're actually better off focusing on space. And that focusing on space will actually help you solve climate change much faster than actually trying to focus on climate change. And so I'd always been sort of fascinated by it and then maybe in college started sort of, you know, monitoring it. Not just, you know, like when I was more of a kid, it was more just like reading sci fi books and like, you know, watching press releases. And then, you know, people sort of ask me like, what was the path? And it was honestly like, you know, in sort of, you know, late college and then sort of after dropping out, it was honestly just like, I just read R Space. R Space, X R Rocket Lab. Like every day I would just like watch all the launches. And again, there was like slightly more than just reading sci fi and like reading press releases, but like, it wasn't like that deep of a, you know, connection. It was honestly just like these like subreddits. And then it was basically in that first year in Venture, super accidentally stumbling across a super interesting commercial space company. It's a company called Akash Systems. And it was extremely fortuitous the way that I stumbled across them. I literally accidentally emailed the wrong vc. I was trying to get in touch with one and I accidentally emailed another one that had the exact same name. Basically there's two Sriram Krishnans in the world of venture. So I accidentally emailed the wrong one. And then as an apology, I was like, can I take you out to coffee for accidentally emailing you as opposed to the one that I meant to email. Then during that coffee, I explained, hey, I'm new to venture. One of the things that I would like to explore over my period that I'm doing this kind of experimental period venture is whether or not there's a world where I could invest in space companies and get to know that industry better. He was like, well, I actually have a friend starting a space company that you might be interested in. I talked to him and was like, whoa, I don't know a lot about the space industry yet, but this actually does seem intriguing. And brought that to Vinod and Sven at Coastal Ventures. And both of them were like, yes, deleon, this is actually very intriguing. We should invest in this. And so I got to basically champion that process and negotiate a term sheet. And the very terrifying thing to do is at the time I was whatever, 22 or 23. And negotiating a term sheet that was millions of dollars when you had 15k in your bank account is particularly terrifying process. But then basically after that I was like, oh shit, I can actually take this stuff Seriously. And I was like, ok, well, how would I become more of an expert on this? I was like, I barely know anything about it. And so let me just start talking to everybody. So I was like, okay, I'm going to look at every single company that has raised venture money in the commercial space. Basically started to get to know all these CEOs. I went and looked up all the big space conferences. I asked this particular CEO his recommendation for space conferences that I should be going to. Then basically, over the course of the last now three and a half, four years, can pretty confidently say that I have met every CEO that has raised north of, let's say, $5 million in VC money that works in the space industry. I know every single incubator accelerator and most of the seed stage companies now by default make their way to both because of the amount of groundwork and legwork that I put into getting to know all these CEOs and other VCs that focus on this. But then also I think now Varda has been somewhat a magnet for it where they see, hey, this VC is also putting his money where his mouth is at in the commercial space industry and really doubling down. And so that was also part of the thesis behind incubating a space company, was this would actually, although obviously it's a huge time sink, would actually accelerate the VC side of the career because more people would be interested in coming to me with their space companies and I'd be able to like win those deals more often.

Yeah, I appreciate you sharing that. It's honestly, I think for me, and probably for a lot of the listeners, it's kind of like, it feels like a whole different world. But that's what shows you how vast venture and startups are. It's a big world outside of social apps and things like that. So I want to dive a little bit into where you're at now, which is Founders Fund. For people that haven't heard of it, maybe outside of, maybe Twitter. Can you kind of just give an overview of like, what is Founders Fund? What kind of types of what markets do you cover? What size companies? Just an overview. If someone's never heard of it before, then we can dive a little deeper into it.

Yeah, I mean, to touch on your earlier point about how diverse VC can be, it's like, I think even as somebody who I thought before joining Keith at Coastal Ventures, I was like, I'm pretty sophisticated in this. I follow these people on Twitter. I'm friends with, I'm friends with Keith. He tells me about VC all the time. I've also been a founder that is like fundraised from VCs. I was like, I must understand this ecosystem very well. And you're like on the other side. And I was like, I had no fucking clue. You know what I mean? You just have no appreciation for. There's just such a. In some ways the way that I like to describe it is companies have a set of constraints. If you look at the culture of a Slack versus the culture of a SpaceX, sure they are working on fundamentally completely different products. SpaceX is much more technical, bigger swings. But at the end of the day, if you look at the day to day, actually not that dissimilar. The engineers are doing engineering problems, there's HR people, there's the CEO leading it, that's doing like press releases and fundraises. They're actually like most companies are not that that dissimilar. Like the bell curve is actually pretty tight versus if you look at venture firms, that bell curve is like super, super far and like spread out, right? Like you know, somebody that does seed stage more like, you know, spray and pray, tons and tons of deals per year, much smaller check sizes. A job like that versus like you know, somebody that focuses on series A consumer social deals at a firm that only three or four deals a year to Mike Spicer at Sutter Hill that does one company a year but incubates it himself and invests north of $100 million into that company by default versus somebody like myself that focuses on the commercial space industry. Those jobs have no overlap. There's just zero. The way that we spend our time, the types of investments that we do, the way that we run companies through our process, there's literally zero overlap. So to talk about Founders Fund, we're a venture firm that's been around for quite a while, founded in the mid-2000s. Our latest fund that we raised is a $3 billion venture fund. It's split half between venture and growth. And so what that means is we end up being comfortable leading rounds all the way from seed all the way through series F or pre IPO rounds. Obviously one person can't be sophisticated across all those stages and across all those sectors. And so people tend to have particular focuses across the team. I'd say in comparison to most venture firms, the things that make us particularly so multi stage, we're not necessarily as strict about sort of like ownership criteria at particular stages through a company. So for example, one of the classic ways that we're able to, let's say Win a deal vis a vis somebody who does have strict ownership criteria. Is that a Series A? If the company isn't that capital intensive or doesn't need that much capital, I can offer the company like a offer that's $6 million at 60 post versus a traditional venture investor that really wants their 20% ownership or something like that at 25, needs to offer 15 million at 60 post when that might not necessarily be in the best interest of the company. So we tend to be very ownership flexible, which I really like. We also tend to be much more comfortable with big technical moonshots. So we're one of the largest investors in SpaceX as an example amongst many other deeply technical companies. And then the other thing that I really like is we're very sort of like decentralized. So for example, most venture firms at our scale have a very traditional sort of like Monday partner meeting. Whereas a company you get invited to present to the partner meeting and then you basically get that decision that same day. We don't have any sort of either hierarchy at ff, which I really like, or any sort of regular weekly cadence or structure. And so what that means is your process is somewhat defined by the point person that you're sort of working with in terms of sort of how they'll guide you from initial meeting through to a term sheet. But because we don't have such a rigid process, we can also be much faster. Sometimes for example, in Coastal Ventures there were times where I'd meet a really great company on a Tuesday and there was just no next step that I could do until basically the following Monday versus here I can meet you on a Tuesday and sometimes by Thursday or Friday, basically get you a term sheet. Super large fund that is able to invest across a multitude of stages. Super ownership agnostic, stage agnostic, sector agnostic, but much more comfortable with deep tech swings like the SpaceXs, like the Vardas of the world where we're doing in space manufacturing, much more so than other venture firms. Then maybe the fourth thing that I'd add is a unique aspect of our investment process is the primary filter that we use when considering an investment is basically why won't other VCs like this, if anything, are hyper indexed against super hot sort of consensus companies? Especially in the earlier stages, like later stage for sure, right? Like in order to be successful companies do start to become consensus. But especially in the earlier stages of a company like primary filter that we think about is like basically why won't other people like this? And so that's maybe the Fourth major point that I make about what makes Founders Fund unique.

So diving into that fourth point a little bit, I think that at least for the tech Twitter crowd and maybe the San Francisco crowd, a lot of people maybe don't like Founders Fund. A lot of people might like Founders Fun, but everybody knows Founders Fund and everybody respects Founders Fun, at least in my view. I think they may not like you guys, but I think everyone respects what you, what you all have done. And I think, like, to position yourself like that, you know, from founding, it kind of takes a lot of like, independent thinking. And I think a lot of the people involved with Founders Fund, you know, Peter Thiel, Keith Rabboy, pretty much everyone is like independent thinkers. I'm kind of curious, what have you learned about, like, independent thinking, going against the grain or just like anything in that category while spending your time at this? It was pretty like contrarian firm.

Yeah. I mean, what I'd say is I think there are ways to have a very healthy culture that encourages, like, discourse and dissension without compromising on cultural cohesion. And I think Founders Fund does a phenomenal job of that. And I think sometimes the public image that you get on Twitter reflects that. Where you will probably on a somewhat regular basis see the group of us disagreeing in public. Whether it's like Trey harping on me for believing that VCs should be super involved in the companies that they invest in, versus Trey believes the exact opposite. He thinks that they should be super disengaged and that the best founders don't want their VCs getting super involved or obviously the most frequent ones. More recently is Keith and I disagreeing on whether to be long SF versus short sf. Right. I think have learned from them how you can still keep a culture. Even if you see us arguing on Twitter publicly, we're perfectly capable of then obviously working together quite closely on a very regular basis. And so it's incredible to see that culture and I think it enforces the Twitter world. Shows you also the way that we disagree about investments internally. Where I think at Founders Fund, if you were to look, a lot of our best investments were relatively controversial at the time within the firm. But it's important to be able to both openly discuss that type of controversy. We're the opposite of a consensus driven culture where you need to basically get. You do not need to get everybody on the line in order to have an investment be done. I think that's a great aspect of a culture. And I would only ever want to work at firms that have that type of what I call conviction driven culture as opposed to consensus driven culture, then probably the third thing that I've learned the most is being an independent thinker can have its faults and downsides. I think my favorite Paul Graham tweet is if you don't have an opinion that would get you canceled on Twitter, if you expressed it publicly on Twitter, then you're probably not a particularly interesting thinker. I'd say I very much include myself in that. But what I've really appreciated over the course of my time at Founders Fund is I feel like I have been taught in the way of tweeting independent thoughts in a way that makes them compelling, but also not so far over the line that you get canceled. And I think pre Founders Fund, I was not aware of how to delicately communicate that. I think Peter's on the extreme end of this. You can see through all of his public talks, he's able to sometimes articulate some ideas that are difficult to swallow at first glance, but he packages them in a way that makes you understand. Ah, okay. Because there are just many times where people will exhibit or explain an idea that is far too radical, that does have some underlying truth. But if you explain it as far too radical, the sort of the Twitter system or the public ecosphere just immediately causes organ rejection versus being able to package these types of independent ideas in a way that people can actually appreciate, understand them and not immediately reject them. And it's fine to disagree with them, but at least they can actually see them with clear eyes as opposed to immediate emotional anger. I think it's a very powerful skill. And so I think that's another thing that I've been taught. And I honestly can say the probably primary teacher of that has been actually Mike Solana. I think he's sort of like world class at that. And I really enjoy the fact that we have somebody like that on our team.

So one last question on that, and I have one more than we'll call it a day. Almost selfishly, this is something I actually struggle with myself. I have many opinions, I voice them, and I don't think sometimes they're palatable, actually. I think I put them out and in a way that I wish I wouldn't have put them out that way. Do you have any tips for just straight up me or just other people that maybe were like you of five years ago before Founders Fund? People that have strong opinions, they want to voice them, but they always get wrecked every time. What is a tip or two that you can share with These types of people?

Yeah, I mean, I think it's basically.

Just having a trusted group of confidants that you can workshop these ideas with.

Right. Knowing that these are people that, that trusts you enough that even if you.

Were to express, let's say in a 10 person text thread, an extremely radical idea that would get you very canceled.

That they recognize that you're sort of.

Experimenting with the idea or trying to.

Chew on it and it's not set in stone in terms of your thought and working with people. Because I think it sometimes can be really hard when it sort of gets stuck in your own head how to articulate exactly what you're feeling and how you're thinking about it.

Right.

And so I think not getting stuck in the sort of like echo chamber of your own head, but instead having people that ideally also have diverse viewpoints. Like, I think one of the things that I also like about Founders Fund is I think most people view us as like this, like, super far right, like Trumpian chop. But if you were to like, look at the actual, like, way, you know, and I haven't like, perfectly analyzed this, but I know how various team members lean politically, like, I'd say that, like, Founders Fund is by far the venture firm that just represents America by default, the most. Like, we have plenty of people here that are like, you know, extremely left and very liberal, and we have people that are on the far right and we have lots of people that are also in between. And I think it actually like, you know, relatively accurately reflects, you know, the status of America. Whereas I'd say most venture firms in Silicon Valley mostly represent the, let's say, politics of San Francisco or California as opposed to the politics of America. And so in those text threads where I workshop those things, I have people that have a variety of different political leanings. And it definitely, sometimes when I first initially put the idea into the thread, they're like, dylan, you're fucking crazy. I'm like, okay, but how do I phrase this in a way you appreciate that there's some truth to this? How do I pull out the truth from this in a way that is palatable without getting that initial sort of emotional reaction from you?

That's awesome. I think that's a great tip and I appreciate it. So let's say someone's listening to this, or many founders are listening to this and they're like, wow, this guy's awesome. Founders Fund sounds dope. How can I learn more about the firm or the fund? How do I tell them about my space company. How can people learn more about you or founders fund or just get in touch in general if there's a founder listening there that like, you know, is building something awesome.

Yeah, I do think Twitter presence that we've developed is a great way to get to know us, get to know our thoughts and interact with us on a regular basis. By far the highest likelihood way of getting across my plate is reply to my tweets with very interesting thoughts, opinions that I want to engage with. A lot of the founders that I end up meeting that I don't know from my preexisting, let's say social network. For sure, sometimes just pure cold emails work if they're very, very well articulated. But if you have an idea that maybe wouldn't quite clear my cold email bar, another great way to clear the bar is just have interesting thoughts on Twitter. And there are plenty of times where I'll meet somebody. Hell, even today in this thread that I was having on climate change and space stuff, I sort of, I'm not 100% sure what his background is, but it seems like he's sort of like an early stage founder where yeah, I don't know if he had emailed me about his. I think it's like 3D printing thing. I might not have by default maybe taken a meeting. But yeah, articulated super interesting thoughts that I felt super aligned with and I thought were well said. And so I was like great coffee on me whenever you're in San Francisco and then you'll have a great opportunity to pitch me and get to know me.

I actually saw that on Twitter today and we're actually connected and he's very, very, very smart. So good. I would say you're good. Note Spidey sense there. So last point I realized I forgot the question. It's the last one you can answer really quickly because I know we're close to time or over time. What's one thing about venture that you wish more founders knew about but don't that would benefit them if they knew and then we'll call it a day.

Yeah, I think it's just that every investor and every firm is incredibly unique. And so when you sort of read broad pieces of advice that people give around how to fundraise, how to interact with investors, what sort of an investor is looking for that it's Never true for 100% of investors and that in order to get your company funded and across the line, you only need one person to say yes. And so don't subscribe too much to particular dogmas whether it's like DocSend versus PDFs, whether it's meeting with founders between rounds or meeting with investors between rounds of financings versus not whether it's being willing to send the deck ahead of time versus not. Be careful to not subscribe too much to dogma and instead tailor your story and the way that you're interacting with investor to the investor that you're basically working with. And you'll have a lot more success if you actually sort of get to know them and how they think and what their preferences are, as opposed to just like, you know, sort of trying to very generically approach everyone in the same way.

Awesome. This was fantastic. I really appreciate you coming onto the podcast.

Sweet.

Yeah, thanks so much for having me. Matt.