Jason M. LemkinCEO, SaaStr · Co-Founder of SaaStr AI, SaaStr Fund, Adobe Sign

Unconventional Approach to Startup Investment: Where Your Time Truly Matters!

11 Nov 2023 · 0 min

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A short conversational excerpt from a Nov 11, 2023 YouTube video featuring Jason M. Lemkin discussing where investor time has the greatest impact. Lemkin argues that spending time on clear winners or clear losers usually doesn't change outcomes; the highest impact is with 'middle' companies that are neither doomed nor already-established winners. The exchange touches on loyalty, return of funds, and how varying levels of investor involvement (e.g., 0.5x vs 1x) can materially affect returns.

This. It ties to how involved to be like the 5x versus 1x. But I actually don't know if you can see it early enough to really have those impacts you described.
A lot of people worry about just loyalty. Quite right. How do you feel about that? Spend time with your winners. They're the ones that return the fund.
I mean, I don't know. I think it's a little bit weird where the winners don't really need you, so spending time with them doesn't really change the outcome. The losers don't really need you either, because they're going to lose. So it's actually kind of the people in the middle that probably need you the most, you know, and so really it's just spending time with those, like, if you spend time with, like, Airbnb or not. I don't know. Also, I've never seen those ones actually fail if they're 100% committed and they have any customers. Right. And I actually think the difference between 0.5x and 1x can be huge if it's. If the funds in carry mode, like, you can make mil, you could also make. Maybe you don't make $100 million, but let's not be gleeful.