Why Founders Get Rejected by VCs: Kamran Ansari on AI, Fund Strategy, and Venture Capital

And look, I think sometimes investors are just naturally curious, right? Even if they have boundaries and rules, they want to meet with the best founders and just see what's going on, right? Like, what are they up to? Is it something really cool that no one thought of, right? It's like, yeah, I don't get out of bed for less than a million or whatever. And then this great founder will be like, well, look, I only have $650,000 open. And you know, they'll hem and haw and they'll come over to $650,000. So like, it's, there's some posturing. Uh, and I try, you know, I, I, I learned the venture business really from Alan Patricoff at Greycroft. All right.

Welcome to the VCFM Podcast. Today we're joined by Cameron Ansari, founder and managing partner of Capital Ventures and a venture partner at Infinity Ventures. Cameron is a seasoned early-stage investor who's backed companies like Plaid, Klarna, Lithic, Koast, and many more with deep experience across fintech, payments, and commerce. We're excited to dig in how venture capital has changed in the AI-first world. Peter and I met him at the Money2020 Summit and had a great conversation, and so we're excited to have him on the podcast with us today. So welcome to the podcast, Cameron. And before we get into it, do you wanna talk a little bit about your background and what you think the audience should know?

Sure. Yeah, thanks for having me. It was, uh, it was great to chat at Money2020 and excited to be here. Uh, I've been in the venture and tech business about 20+ years, both in Silicon Valley and in New York. And had the fortune to work at a number of venture funds, including Tsai Capital and Greycroft for many years, and now have my own vehicle for doing seed and pre-seed stuff on my own. And then I'm a venture partner with Infinity as well. Infinity is an early-stage fund focused on commerce and fintech, and was founded by the former PayPal Corp Dev and Ventures team that spun out about 5, 6 years ago. To start Infinity. And they're guys I've worked with for a long time, going back to when I was an investor in Venmo and we sold Venmo and Braintree to PayPal. And then when they started PayPal Ventures, did a bunch of deals with them through that group, including Acorns and Plaid and others. And then when they spun out and started Infinity, been doing deals with them since then as well. So known them for a long time. It's good to kind of start working more closely together with them. And I've, you know, in my career also had a few operating roles. So I think it's important to actually have I've done stuff on the operating side as well. Most recently I was at Pinterest in San Francisco running strategy and corp dev and seeing all the good, bad, and ugly of being inside of a hypergrowth company while it's still private. And I can talk about that as well if you want, but thanks for having me. Awesome.

Welcome, welcome.

I'm curious what types of investments, what's your investment thesis? For your firm today?

Um, so the— I, I think about sort of investment the— as the kind of majors and minors, you know, like my major is definitely, uh, fintech and payments, and maybe the minor is more commerce and commerce tech. But, uh, one of the nice things about, um, having my own vehicle in addition to kind of doing stuff with Infinity and, and Greycroft and others over the years is the flexibility to do stuff that's Neither of those things, or maybe a little left of center. Because I think I've learned over the years that venture is the business of exceptions. So you're looking for exceptional businesses, exceptional founders, exceptional ideas. And if you're too rigid with your kind of like the investment has to fit in this box, it's like, it's gotta be like, you know, seed round raising $5 million or less at this valuation or less. And you know, and this Thomas on this and that. Um, you know, when something comes along, we used to have a spidey sense that this is something special. Uh, then you gotta jump on it. So I've done a few of those over the years and, and, you know, some have worked out, some haven't. But, um, the most recent one that's totally not part of Infinity or anything else is a, a karaoke business, uh, that I'm real excited about. Uh, which we can, we can talk about maybe a little later. I don't know if those guys have announced what they're doing yet, but, uh, that's gonna launch soon. And I also just backed an e-commerce business, a D2C e-commerce business in the kind of cowboy western skincare area. So that, that would be launching soon as well.

Very cool. Yeah, those are quite the departure from fintech.

Yes.

I'm curious, you've been at this game for a long time and worked at some really great firms. There's always a lot of talk in the industry about how it's important to be disciplined as an investor and kind of like stay stick to your guns. But then to your point, like it is an industry of exceptions and I think there's not a venture fund out there that doesn't like go outside of their bounds on occasion. How do you think about, especially like from somebody from the outside looking in, right? So like a lot of founders will look in and say, oh well, like that fund's not a fit for what I'm doing, so I won't pitch them. Or what'll happen more often I think is they get frustrated when they're like, hey, I pitched this found— this fund and the fund was like, no, you don't fit in my box. And then they went and funded a karaoke business.

Right.

You know what I mean?

And I have had someone get mad at me for funding that karaoke business because they're like, well, you never fund my thing, but you funded that. It's like, well, exactly. Have some, you know, provocative or prerogative, I guess, if you want us to do the deals that you think make sense. Discipline, look, discipline is important, right? You can't look at everything under the sun. What discipline does for you as a firm, as an investor, is kind of put some guardrails or filters on what you gotta look at. Because, you know, if I was gonna hang my hat out there and say I'm looking at every fintech company in every geography from seed to Series D, it's just like, it's too much stuff, right? You're just gonna be inundated with, deals and things being sent your way. So you have to kind of put some boundaries on it. And I think that helps you focus. But look, this is a super category. FinTech is not a small area. It has multiple subcategories that are enormous. Similarly, I think commerce tech and e-com are pretty big spaces. And I just don't think you know, it's not so limiting, but I think at least it kind of puts some boundaries on things and you kind of have to do that, I think, just to kind of keep your own sanity. But, you know, I had that experience where founders get frustrated or they're like, look, you know, why did we even meet? You know, you knew I was raising a seed round, but you know, you're a Series A fund or whatever, right? Like I've had founders of mine go meet with other firms that do this. And look, I think sometimes investors are just naturally curious, right? Even if they have, boundaries and rules, they want to meet with the best founders and just see what's going on, right? Like, what are they up to? Is it something really cool that everyone thought of, right? It's like, maybe, maybe, you know, this, this will be the one deal that breaks, you know, all of my rules and I'll, I'll, I'll do that. So I think, I think every major venture investor, despite what they say, will make exceptions. Um, but I think some of the, some of the larger, more kind of prestige firms, probably make fewer of those exceptions than others because they just don't have to, frankly. A lot of times they're just like, well, I don't have to make exceptions.

Right, right. Do you think that makes them better firms or is it more just to your point, like they can do it, like they don't have to make exceptions, so they don't?

I think it's more that, you know, it's like they can drive a harder bargain. But again, I've seen even those firms when it's a great deal, you know, they'll be like, oh, my minimum check is a million. I don't get out of bed for less than a million or whatever. Yeah.

Yeah.

And then this great founder will be like, well, look, I only have $650,000 open. And you know, I'll hem and haw and we'll come in for $650,000. So like, it's, there's some posturing. Uh, and I try, you know, I, I, I learned the venture business really from Alan Patricoff at Greycroft. Uh, who's, you know, just, I, I think the best sort of investor and, and, and manager I've worked under in the venture business. And he's built, you know, multiple firms and he's, seen everything. And one of his mantras was always to try to have some flexibility because flexibility enables you to get into deals and get your foot in the door and kind of not get in your own way. And so, you know, at Greycroft, at least initially when I was there, you know, we would lead and follow, we'd syndicate deals, we'd write a smaller check, we could take a board seat, we could not take a board seat. It wasn't this like, We're only doing deals that are like on Sand Hill Road or in New York City, and we gotta write a million dollar check and have a board seat and own 10%. And this, you know, once you get down this list, it's like, it's so limiting that again, you can kind of get in your own way. So I think it's good to have that flexibility.

Yeah. I also think a lot of funds use kind of their quote unquote rules as a way to say no for other reasons that when there's another real reason. Right? It's like, you're right. I don't want to tell the founder that like, I'm not going to back him or her because I don't trust them or I don't believe in them or whatever. And so it's a lot easier to just say, well, we don't do these types of deals.

Right?

Right.

You know, we, that, that, that's correct. Um, when I was last raising, Peter said he didn't trust me, so I don't know why I'm different. Just kidding. Well, and, and I was just thinking about those, it's, You know, so I think everyone likes to say, uh, I, I appreciate direct feedback. I really want you to tell me what you think. But like, the truth is a lot of people don't appreciate direct feedback and like, you know, they didn't want you to call their baby ugly. Uh, and so it's easier to say, look, you know, this is a little left of center, not exactly the kind of deal we're looking at. Um, but you know, I, I do try to, I tend to be more direct. I do try to tell people I was like, look, yeah, I know the company last week that came in and this guy had this big grandiose ambition to like reinvent the construction business and do all this stuff. And, uh, and he's like, yeah, that's what we're going out for a seed raise of $320,000. And I was like, look, it feels a little bit like unambitious given the scale of what you just described to me to be raising, you know, $320,000. Like, well, he's like, well, but I, you know, people told me that I should be capital conscious and conservative. So it's like, you know, I think founders have all kinds of people in their ears and they're, maybe they're watching too many of these podcasts or whatever, I don't know, uh, from, from guys that haven't done it as long as I have. But, uh, and so that they come with these beliefs that you're like, well, who told you that? I don't know. Like, I don't agree with that. Uh, and maybe that's true, but not if that's true, then you shouldn't be pitching like institutional venture investors.

Right.

Um, so, uh, I think it's important to kind of maintain that, uh, that perspective. But yeah, I do agree that some firms use those rules as a, uh, I don't want to say crutch, but kind of a, a fallback to kind of soften the blow. Yeah, yeah, yeah. I'm having some coffee. I don't know if he's like blurred the brand because, you know, they haven't— a large Seattle-based chain is not paid to—

they haven't sponsored this podcast.

Should I like put a sticker on the— want to like, you know, That they'll fall out of any sponsorship yet.

Um, well, so let's switch gears a little bit. We really wanted to talk with you because you've been in this industry a long time, seen a lot of like shifts, changes. Um, let's talk about AI and not AI from a perspective of what's, what's the cool new AI business to invest in, but how is AI impacting venture? From your perspective, both like how firms operate as well as like the broader, you know, venture ecosystem, for lack of a better way to describe it.

I saw a good, I was saying AI, someone recently was like, yeah, you mean Allen Iverson, right? The basketball player. It's like the only AI that mattered 20 years ago. Um, I mean, it's been a tectonic shift for sure. In some ways and in some ways it's reminiscent of, you know, if you've been doing this long enough, like I remember the kind of internet wave, the, you know, Web 1.0, Amazon, WebVans, you know, Pets.com, that era. And then you had kind of the mobile revolution and you had SaaS and you've had kind of big data and there was a while where everything was like big data. It was kind of the hot word. And then like before there was generative AI, it was machine learning. And at Pinterest when I was there, obviously we had a ton of AI that we leveraged in computer vision. So like to me, AI wasn't this like brand new thing. It's like, you know, it could just, we had it 10 years ago. Obviously come a long way. But so, you know, my response would be in some ways it's the latest kind of technology wave that's profound and in changing businesses and so forth. Meaning that it's, yeah, I don't wanna say just another thing, but like kind of just another thing, right? Like the next evolution from like the internet to mobile to SaaS to, you know, big data and cloud and all that. But there is this sort of sense of, uh, that it's different, right? There's a sense of like, this is different than anything that's come before it. Um, both in a good way and a bad way where, you know, there was this article yesterday or last few days about where the guy's like, you know, something awful is happening with AI, like this latest Claude model. Like, you know, we've become the singularity, like, you know, Cyberdyne Systems has become sentient and we'll, eventually, you know, we'll have the Terminator 2 scenario happening. Um, so there is some of that, but, um, but I think the point that you're making and you want to get to is like, has AI and will AI change the venture business itself? Right? Yeah. Um, the business of a certain genre of people like myself, uh, providing capital and guidance and counsel and help and assistance to founders building companies. And my answer to that is largely no. With the exception of AI is going to fundamentally transform the way that, and it already has, the way that deals are sourced, analyzed, underwritten, like all of the filtering, the analytics, there's a lot that can happen with AI now that just wasn't possible before. So to the extent that, you know, a lot of firms have now built their own systems to essentially try to distill down like all the, you know, thousands and millions of companies are started every year to like hear the most promising. And then within those, like, you know, looking at all the different metrics, like number of LinkedIn posts and like number of roles that are, they're hiring for the velocity of like internet searches for that name and all these different signals that now you can very quickly kind of process and put through AI to kind of help you filter. Yep. So I think that sourcing and analysis piece is probably the most immediately impacted by AI. But the part that's not, the part that I think is very difficult to emulate using AI is the piece where, you know, I still think that fundamentally early stage venture is a business of hand-to-hand combat and one of kind of a founder and a partner relationship. And it's about trust and counsel and advice and nuance. It's not just about writing a check because there was a comment somewhere here, you know, capital is commoditized. Well, it's like, if that's true, then why do the best firms keep seeing the best deals, right? Like if founders think capital's commoditized, then just like go to the bank, right? Why do you want to raise from Sequoia? Um, so capital's not commoditized, not an early stage venture. Late stage, maybe, right? You're raising your, you know, Databricks is raising their Series Z or whatever, and they're going to raise $100 billion or $50 billion. Yeah. So you can have like the Abu Dhabi government and the Singapore and these people and like Kotu or whoever, like that's fine. Um, but the early stage is not right. It's really about trust and I was thinking about this this morning because there were two deals that, um, we, we just closed this week and they're both founders I've known for a long time. Mm-hmm. And, and then each of them last week there was, um, you know, there's always issues that come up, right? You have to negotiate around economics, board seats, governance, um, check size, valuation, uh, you name it, right? Class of equity, like you have preferred, senior preferred, parabola. And I mean, could I have had AI have all those conversations with like the founder and my lawyers and everybody else and then like go back and forth and negotiate in a way that was satisfactory? I doubt it, right? Like, um, you could maybe exercise some amount of intelligence on like going through all the documents and saying, hey, like based on, you know, Gemini says based on like all the documents, this should be pari passu at this valuation. Okay, fine. I can use that as like a backdrop, but I still gotta call the founder and be like, here's why we think this is the right price and I should get this equity in it. And so there is an art, um, and, uh, a, a real kind of nuance to how you negotiate and how you build trust and get deals done. Um, and that's just the beginning. And then you gotta like manage the company, be on a board, navigate hiring and firing, running outta money, maybe going outta business. I mean, a zillion lawsuits. There are a hundred things that come up, right? Um, and that, that's what you're doing as an early stage investor is being there as a, as a counselor, as a fiduciary, as an advisor, uh, someone who's sort of, they can lean on. Yeah.

Do you think like funds structures change over time? And, and part of this, like, it's kind of like an intersection of two, two major trends that I feel like we're seeing. One is, um, a friend of mine made a comment. He's like, the strategy today, it seems like that our work— there's two strategies in venture that work.

You're either big or you're first.

And so you're seeing like more and more of these funds get bigger and bigger and bigger. And what they sell is not necessarily performance. They sell the ability to cut a $100 million LP check into their fund. They're really asset managers or They're pre-seed, seed, kind of a lot of the investing you're doing and they're, they're first, right? They're finding those diamonds in the rough. They're building the relationships, especially where like capital is not commoditized and those relationships really matter because it is more of a partnership. But then you also marry that with AI coming in and saying, hey, I don't necessarily need analysts, associates, even principals, right? Like anything that's like deal sourcing and analytics. Potentially could be outsourced to AI.

I don't know.

What do you think? Do, do we, and what does that mean for venture?

Let's start with the first comment. You chat. Yeah, I agree. The first comment, right? The business is bifurcating. The venture asset class is bifurcating into mega funds that really, to call them venture funds feels in some ways disingenuous. Sure. Um, like I saw there was like some hot take that this woman put on LinkedIn, which she was like, Andreessen Horowitz is not a venture fund. It's like, okay, that's a little aggressive, but like, you know, she's kind of right. Yeah, it's a multi-stage asset manager, right? They have early, late, they do public, they do crypto. You know, they don't— I don't know if they do long-short or real estate, but like, it's only a matter of time, right? Right. And so there is that genre of fund and firm and they have a strategy. Like you said, it's about AUM, it's about kind of different asset classes. Diversification and the resources, right? You have hundreds of people. And at Pinterest, Andresa was one of our investors and they had like a corp dev team and a recruiting team and a marketing team and like all these people that I could like call up and get help on stuff. And so that's one model. And then there's sort of the artisanal bespoke early stage model, which is, you know, hasn't changed much really. It's still, you know, in my view, again, I think it's, venture is kind of, at the early stages, it's not a team business, it's kind of an individual sport, right?

Yeah.

It's no matter how big the firm is, no matter how many partners there are, the founder tends to have a relationship with one investor, you know, who sponsored the deal, brought it in, who championed it or believed in them early and was gonna pound the table and explain to everybody else why this thing is great. You know, they're not texting 10 people at the firm when something goes wrong. There's, again, there's that one relationship. So I think that that is definitely happening. And at the earliest stages, maybe it's kind of pushing people to become even more, as you were saying, maybe smaller or artisanal and like, you know, kind of not as, not choosing a swim lane, right? Being first, yeah, that matters for sure. Especially because at the, you know, these rounds you're talking about, if someone's, you know, someone's a, it's a great business, maybe a repeat founder raising $3 or $4 million, right? It's just not a lot to go around when you have multiple kind of institutional investors. I haven't thought, your other question though about like, so does that mean that it's early stage firms that you don't need as many analysts, associates, principals because The work of kind of doing the analytics and memo writing and sourcing, um, can be, can be, you know, uh, outsourced using AI. I don't know. Yes, to some extent.

There's also an element if everyone's moving, you know, if there is this bifurcation, do you really need a lot of people, right? So to underwrite like a pre-seed, seed deal.

No, you, you, like, with my own vehicle, for example, I, you know, I'm investment committee of one. I can, uh, you know, the hardest part sometimes are the capital calls because you gotta like, you know, move money around or, you know, call, you know, uh, call the broker or do whatever. But, um, but it's not, you know, you don't need a lot of people to kind of do, um, the decision-making. But there is, uh, there was a complicated once we're in a deal, there's absolutely a complicated process of, especially if you're an institutional investor, if you have institutional LPs and you have audits, you know, we're all this now at Infinity. I saw this many times at Greycroft. You have to track all the investments and the more funds you have, you know, by the time we were on like Greycroft 3 or 4, we had like 250 companies or something. And you gotta have all their quarterly, you know, financials and you have to do a thing with PricewaterhouseCoopers or whatever and file it and And so that administrative burden alone does really need analysts and people at the firm. And you can outsource some of it and have like, oh, our external CFO and the external audit firm and this external this and that can, but truthfully, you still need at least a person or two who's internal full-time at the fund and knows these companies to work on that. And that's not a great use of time for like, the partners that should be actually doing deals and working with the founders to be spending time. But like, it's, it's a very real part of the business. Sure.

Yeah.

And, uh, and a part that's actually tough for smaller firms. Yeah.

Well, it's, it's, it's part of the expectation of being institutional, right? You might, is that you do all of those things that you do. Otherwise you're just like an angel.

Right, right.

And you do club deals, right? Um, So there's a certain amount of rigor, but we'll see.

I mean, I haven't seen it yet. I mean, I do know some firms that, you know, are newer firms and the, the initial, there's one, this one group here in New York where like there are 2 or 3 partners and then they had a couple of like principals and senior associates and stuff. And then after a year or 2, they just decided just to like have it be just the partners. Yeah. Um, but I don't think that was, that was not about AI and it wasn't about like cost cutting. It was more just, I think they felt like if you're doing the kind of early stage artisanal thing, then you really want the founder to have a direct relationship with the partners who are gonna be leading the deal. And other people in the mix just kind of might add noise or that, you know, they're at events and stuff. And then there's always this thing where it's like, well, can you write checks or not? And it's like, yeah, you know, and there's some firms where there's this like theater where everyone's named a partner and you don't really know who's a partner or not. Um, so I think there has been some pushback on that where firms want to kind of avoid all that by being smaller and just having, uh, generally only, you know, partners or checkwriters.

It feels like, tell me, tell me if you, you think differently, but it feels like we're, we're seeing this bifurcation. Um, firms are moving earlier by nature of the fact that they're moving earlier. The things that matter is the relationship between the partner and the founder. Um, and so there's less need to have kind of junior staff. And then AI is not the driver, but it is kind of an enabler in, in the idea that like, well, now I really don't need the junior staff because the AI can do a lot of the deal sourcing and the underwriting, you know, with me alongside me, if that makes sense.

Well, again, I, I agree with some of that, but not all of it, 'cause I, I, I don't know if. Time will tell if these firms actually contract and you have fewer junior staff. So the junior staff, again, are not, in my experience, the ones that are really good, like they add a ton of value and they're, they're integral to the team because they're doing the, your, your first line of defense. They're, um, doing a lot of the stuff I mentioned in terms of, um, like managing the portfolio and, you know, setting up demo days and setting up updates with the companies and putting together the board notes and things like that. And these, all these things matter. Um, and, uh, they, they serve an important role also in just kind of, um, being closest in some ways to some of the founders in technology. They tend to be younger, they tend to be out more, they tend to be like using the newest products more, more readily, more facile with new technology than maybe some of the older partners. And so, um, there's an important role they play. At these places. And then, you know, venture is very much like one of the last kind of cottage apprenticeship businesses, I think, where you learn by being at the firm and seeing what it takes to do deals and, you know, what to do, what not to do, questions to ask, and building that judgment and pattern recognition. It's just hard to do that unless you've been at a firm and kind of worked under people that have done that. Yeah.

Yeah. Well, I, I mean, I hope you're right because one of my concerns and fears as, you know, a, a fund manager who spends a lot of his time training students on how to do venture investing is that there will be fewer analysts and, you know, junior roles and that it will be more challenging for people to get that experience, right? To get that apprenticeship, that coaching, because I don't, it does feel like that is such a necessary part to becoming a great investor, right?

Oh, totally.

You talk about Alan, who's an absolute legend, right? Like, you know, think about how many people he's coached, mentored, and sent on their way to becoming a big—

his coaching tree, it's like Bill Belichick. Yeah. You know, the people that have kind of worked under Alan that, and even like I had the fortune at GreatCraft to have a number of people who were associates and senior associates that maybe I helped bring in or worked with and trained and hired who like I now see are partners at other firms or started their own firms. And so it's just, it's a cycle, right? And that's a natural way. And if there are less analysts coming up through these firms, then, you know, may end up with like the China birth rate problem at some point where it's like, oh, it's like, wait a minute. Like we, everyone, like I have all these like really old VCs and no one behind them has the experience. So, you know, I think it'll self-correct. I, you know, I'm not too worried about it.

Yeah, that's fair. So along that thread though, when you're thinking about junior talent, what are the things that you are telling them or coaching them on? What do you think are the things that are important, especially at kind of the early stages of a venture career?

Sure. I mean, the best folks that I've seen come through, combine, I think, like a base level of aptitude and horsepower with just the right attitude, right? A sense of kind of wanting to learn, committed to kind of doing more, showing up. And it's not just about like working hard. Like, you know, if there's someone who is forcing it, but it's not a natural fit, they can work as hard as they want. and it's, it's gonna be awkward. Uh, and I've seen some of those where it's just like, look, you know, you can show up as early as you want, stay as late as you want, but like if founders don't, you know, resonate with what you're saying or your style or it's just, it's not gonna work. Right. Um, so, uh, but I think you do have to combine the two and, and kind of have an attitude of, you know, I'm here to learn. I don't know everything from day one. I mean, some people come to these firms and all of a sudden it's like, I have a business card now that says I'm a senior associate of Firm X and I'm gonna go around and we've seen this and it's embarrassing, like go around to events and kind of like give founders advice and like talk to them about like how they should build their business. And it's like, well, you know, you're 24, 25 and never really built anything. And so you have to have a sense of humility and self-awareness about it. And I think the best people that come into the firms as associates, senior associates have that. And the worst ones don't. And they try to come in day one and kind of be like, you know, Big Johnny VC and doing that whole shtick. So it is a combination of the two. And then, but you know, the most important is that willingness to learn and to lean into, you know, like the, I've seen people who are like, oh, you're, you know, you're taking a meeting with so-and-so, would love to join or listen in. Because again, so much of it is just like being a part of as many conversations as you can, like seeing as many pitches as you can, meeting as many founders as you can, and then you develop that pattern recognition. And there's kind of no substitute for that.

Yeah.

So to me, I think that goes a long way.

Yeah. No, I agree. And, and that's something that I hammer with a lot of our students. I'm like, you just need reps. Just sign up for as many deals as you can handle because whether you like the deal or not, you're gonna learn something from it, right? That's gonna go into that pattern recognition. You need to see some bad deals, you need to see some good deals, you need some good founders, some crazy founders, founders, right?

Well, I mean, part of the problem, well, part of the problem with venture is, um, this is a long feedback cycle. You know, you'll make, you'll make investments now, you're not gonna know for 10 years if they were good or not, right? Yeah. Uh, now I will say, and I was talking to, uh, my partner Jeremy and Infinity about this, that, you know, I, it's rare that a company that like has been pretty mediocre all along, all of a sudden like just flips a switch and is amazing. Like you think about, I've been mentioning like either my athletes, right? It's rare that like, you know, LeBron was like kind of, and then all of a sudden he became amazing like 8 years into his career. It happens, right? I mean, obviously, you know, Sam Darnold or whatever, he's won the Super Bowl. Uh, after many years of kind of bouncing around. So that happens with some companies, but by and large, you know, which ones are the winners early on because they tend to attract the best talent, the more capital, there's growth. Like, so, um, but that said, even, even then, you know, things can go sideways. And so you don't know for a long time whether someone's a good venture investor or not. Uh, and so you're kind of like guessing at it a little bit along the way.

Um, and, uh, there's also like a certain amount of luck too, I just believe.

Sure.

Like, which is why you matter.

Yeah.

'Cause you could have somebody that's, that's exceptional at fighting their way into a super hot oversubscribed deal and like there's value there. But as you know, as well as I do, just because it's a hot oversubscribed deal doesn't mean it's going to be successful.

No. And so, in fact, some of us wonder if there's like a reverse correlation there. Right, right, right. Yeah, it's, by the way, I, I have, I, I do need to post this somewhere, but I have noticed there's a, there's not an inverse correlation, but no correlation whatsoever in my opinion, between founders who send update emails and those who don't. Interesting. Like, like I, I have founders that send update emails all the time and then like all of a sudden you get a, you get the last update and it'd be like, we're going outta business. Like we're done. And you're like, wait a minute. Like the last like 10 updates were all like, you know, the, the standard format, like what's going well, what's not going well, how you can help. Like, oh, okay, so he's like moving along. Then you get one that's like, we're outta cash, sorry, stuff. Yeah. Yeah. You're like, what? Like what happened there? And then you have others who like don't send any updates at all and they're crushing it, right? Yeah. And then everything in between. So unfortunately, like I, you know, all else being equal, it is nice to get updates. It helps, you know, maintain connectivity and you stay in touch and there are opportunities to help and things like that. But I have found that for better or worse, I, I can't find any like statistical correlation in my portfolio with like outcome and whether they send update emails. Yeah. Yeah.

That's funny.

Yeah.

I, now that you mentioned that, I, I couldn't, I couldn't tell you that I can see any sort of correlation either.

Well, so like, you know, it, it's nice that you do it. Right. Uh, and I think it's good practice, it's good hygiene. Um, but I don't know if it's gonna be, you know, deterministic of a good outcome. Yeah.

What do you think does, is like deterministic of a good outcome? This is a question I know that everybody always asks, but like, what do you look for? Right.

It sounds so trite, but honestly, like it all comes back to the founders. Like the, the companies that I've had that have had good, good outcomes, it, it wasn't linear the whole way. It wasn't like there were never any issues. There were never any, you know, there are always setbacks, right? There are always. you know, people forget like Facebook had a down round, right? Uh, early on when they were like, they were at $15 billion, that around, I think at $4 billion and Microsoft did or something. So, um, there are always setbacks and the best founders find a way through, right? They're figure outers. Um, and they don't get, you know, they, you know, they might get upset or whatever, but they, they don't get down and kind of like, they figure out, okay, well, what's the next path, right? Like, how do I resolve this? And, um, and that's what just makes such a difference to bet on the person, uh, especially at the early stage, because the ideas and concepts and business ends up changing anyway. Um, it rarely ends up looking just like it looked when you first invested, but, um, but the tenacity of the best founders is really what I think ultimately determines success. Yeah. Yeah.

Right.

Yeah. I mean, you know, the best founders for them, it's, it's not a career choice. It's not like they woke up one day and it was like, I can go to banking or go to business school or start a company. It's like they start a company because they can't sleep at night knowing this doesn't exist in the world. Uh, and they have to, you know, bring it to fruition and have it exist and have it be successful. Um, and it, you know, a lot of that's innate. It's just some people are born that way, right? They're wired that way.

Yeah.

And by the way, relentless, 'cause I did have a founder recently who was like pretty relentless, but their company still failed.

Sure, sure. In of itself, that's not enough.

Yeah. Right. But he was like, and he's also relentless kind of in the wrong way where he just like, he was just like, you know, he's like constantly texting you, calling you, emailing you.

Yeah.

And he was doing the same with like other investors and VCs he was meeting and talent he was trying to recruit. And so, you know, there is again like, a certain amount of nuance that goes into like being also like charming and, and having some EQ. Yeah. Yeah. And just like, just because you're like, um, hard charging and, you know, working 24/7 at, you know, doesn't necessarily mean you're gonna be successful. Right. People also have to like, like you and like working with you and et cetera. Things like that.

Right, right, right. Yeah. No, I mean, definitely like being a great founder also means that you have to be good at influence effectively, right?

For sure.

Whether that's sales or management or leadership or whatever it is, 'cause you're just, yeah, to your point, you, everybody's gotta like me. Customers, employees, investors, partners.

You gotta attract capital, you gotta attract talent. You gotta attract business, sales, partnerships, BD, eventually maybe acquirers. You know, these things are, are not easy. So I think you do have to have that skill deal.

Yeah, for sure. So in the last little bit of the show today, I wanted to, to talk a little bit about fintech. So fintech has been on kind of a rollercoaster journey over the last, let's call it 5 years, 6 years now. Um, where do you think we are today? Where do you think we go? Where, where are the opportunities? Where's the intersection of AI and, and fintech really play out? Um, you know, we, we did a lot of fintech investing over the last 6 years and like it's been a very mixed bag for us. Um, yeah, to be honest, like I think it has been for most fintech investors. So for everybody, I'm curious, curious how you're seeing it today and going forward.

Well, leaving AI and fintech alone for a second, 'cause that, that's, that's a big topic. But fintech, um, if you would've asked me a few months ago, you know, the big narrative that's been true for a while has been lack of M&A. But then all of a sudden you had like Capital One picking up Brex, which I didn't see coming. That was, yeah, kind of came out of nowhere. And then yesterday Grab is going to buy Stash, the, you know, the investment app, which again was not on my bingo card. The Grab, which I think is, you know, is like mostly an Asian, Southeast Asian rideshare and delivery kind of DoorDash, Uber comp is buying a US-based investment app.

It'd be like Uber buying Robinhood a little bit. I mean, it's like, where's the—

Uber buying like the Robinhood of like Singapore or something, you know?

Yeah, exactly.

I don't know, it was just the geos didn't make— but, and then, you know, MrBeast picked up Step over the weekend or whatever. Um, so there's some M&A happening. It's like curious M&A. It's not, you know, it's not exactly, um, what we underwrite to, what I would hope for in terms of the comps that it sets for my companies.

Yeah.

Uh, but, um, at least it shows a thawing of the, of the, uh, fintech M&A world, which was pretty quiet for many, many, uh, quarters and, you know, really last 4 or 5 years. And then you've had a handful of IPOs. You know, again, knock on wood, thankfully it's exits. So you have Klarna and Chime and eToro and Wealthfront and, you know, a handful of others got out, right? But then like the stocks haven't performed super well. So again, it's like, I think the story has been one of kind of mixed bag. Yes, there's exits, but like asterisk, they're almost all like below the last private valuations, um, which, you know, the private valuations obviously got a little out of hand in, in 2012, 2021.

And not just in fintech, right?

Across the board. Not just in fintech, yeah. So it's hard to live up to those, but still you would hope that, okay, the, the adjustment happened, you know, like Klarna, they took the haircut from, you know, whatever it was, $29 billion down to $7 billion. They came out and, you know, went public at $9 or $10 or $12 Hopefully you grow from there, you get to $14, $16, $18 billion, but it hasn't, right? It's sort of like back at like $9 or $10 now.

Yeah, it's just kind of been flat.

And that's kind of been the story for most of these. Yeah. Uh, Navan and, you know, a bunch of others. Um, so again, mixed bag, although I am hopeful that now that Capital One at least made a move, like put a piece on the chessboard. Mm-hmm. What I'm curious about is, does that finally force the other banks to start looking at fintech M&A in a more serious way? Because they really haven't. Like, B of A's bought nothing. JP Morgan has bought a couple things, but then like they had kind of the black eye with the student loan business, like a fraud or whatever. So they've kind of like put a halt on things. Citibank hasn't picked up much. Goldman has done some of the JVs with like— on the thing they did. Sorry. No, we're good. Um, but, uh, you know, this, maybe this opens it up, right? Uh, and some of the banks actually start looking at fintech deals that they may want to, they want to do.

I've been wondering, what do you think, um, I, so you look at the public markets and like, yes, over the last week or so, like everything software related.

Oh, demolished.

Yeah. I mean, just bad. But even before that, like a lot of these companies weren't performing super great in the public markets anyways. And I'm wondering how much of that is driven not just by like the perceived impact of AI, but just the capital flows to AI. So I was talking to this, he's the head of a boutique investment bank in California. Been working in industry for, I don't know, you know, 40+ years. And he was like, last year there was a hundred, it was like $140 billion raised in the public markets. He's like, there was over $200 billion raised in the private markets. And, and so like, I'm wondering if like some of this is just, if you are not AI, and frankly, if you're not one of like 10 companies, there's just not a lot of capital available for you to push up valuations. Um, I don't know. What do you think? Yeah.

I mean, I think that's valid. Uh, I, you know, there's a few things in there. One is a lot of people will tell you, oh, like the venture market in 2025 was so robust. That's like the biggest ever. But it's like, it's because it's driven by like 5 or 10 companies raising mega monster rounds. and then everybody else, you know, it's, it's as hard as ever. Yeah. Um, so that there's that kind of Tale of Two Cities thing going on there. And then, um, on the public markets, look, the public markets are, it's a, it's a voting machine. It's a, it's driven by sentiment. Like, I'd love to say that it's all based on like fundamentals and EBITDA and it's like, okay, yes, in the long run, ideally in theory, I believe that like the data shows it's driven by like revenue growth and EBITDA, things like that. But, um, any given quarter, any couple of quarters, it's like you're out of favor. You know, the analysts don't like you. Uh, they don't like your CapEx or the, your hiring plan or whatever. And so all of a sudden you just get, uh, and the moves are more volatile than ever. Like when you have Shopify losing 10% in a day, uh, off their market cap with no company-specific news, just because like, Cloud's AI is really good. Yeah, man, this is brutal, right? Yeah. Yeah. But I think it's a buy opportunity. I saw it today. Like there people were, you know, people had named a bunch of these stocks that they were like, oh yeah, I'm, it's a good time to buy.

Yeah. Time to buy. I do think there is an element of, you know, Claude comes out and all of a sudden people are saying, you know, we were paying 35 times EBITDA, right? Basically saying like, you can take 35 years to pay me back 'cause this thing's basically an annuity. And say, well, I actually don't know if like in 35 years Salesforce is still around.

Yeah.

I don't know. Probably. But like, are they, you know, like, I don't know anymore. It's not as certain. And so when there's that uncertainty, then valuations get cut. And it's not that the company itself is underperforming in any way. It's just like, well, 35 years is a long time.

Yeah. And I don't know if that's the right timeframe to look at technology investing anyway. Right?

Right.

Maybe for buying, I mean, I don't know, Coca-Cola or P&G or some of these kind of more longstanding companies. Yeah. You can think about a 20, 30-year cycle.

Yeah.

But like, you know, should you be holding Salesforce for the next 20 years? I don't know. It's not, Yeah, it's just these businesses change so fast and very few of them have maintained relevance for 20, 30+ years.

Right, right.

Even if you look at like, you know, think about how big like IBM was, right? Or, you know, when I, like when I was first starting in venture, it was like IBM, Dell, Cisco, EMC, Compaq computers, Hewlett-Packard. Those were like the juggernauts, like the Mag 7 of the day. Yeah. And like they've largely been displaced. Yep.

Yep. Yeah.

Yeah.

It's interesting. We'll, we'll see. The other thing that a friend of mine brought up is he's like, there's just not a lot of growth in the public markets. So companies, by the time they go public, they're just not growing that fast.

Yeah. They're longer listed.

It's like 20, 30% year over year growth. Whereas it, you know, in the public or in the private side, you're, you're closer to that. you know, what, 40 to 100% depending on stage.

Yeah. No, they, companies are waiting longer to go public and so by the time they go public, a lot of the growth has been already kind of taken out of the equation and so they're not growing as fast.

Yeah. Um, yeah.

And a lot of the capital appreciation has also been, you know, already captured. Like it's gonna be interesting to see if and when OpenAI and Anthropic and, you know, SpaceX and some of these names come out. Will the stock pop? Like, are, are these guys gonna really have meaningful appreciation from their last private rounds, which are so extraordinarily high? Yeah. I don't know.

I don't know.

Yeah.

I, I think there's an argument to be said that, hey, there's a lot of people that want access to these things.

And so maybe, and it comes back to what I said at the beginning, it's just a voting sentiment machine. Like, it's like the People want, it's a mass voting machine.

So I do want to spend just a couple of minutes and talk about AI and fintech and how, yeah, what are your impressions? Like where, where is AI impacting fintech? Where is it creating opportunities? Where is it just noise?

Yeah, the, I mean, the, there were like a few subsectors within fintech where I think AI like we've seen a lot of cool companies come out leveraging AI. One is anything that has to do with kind of fraud compliance, looking at all the ways to kind of prevent, detect fraud and maintain compliance for companies. I think that's an area where AI really is useful.

Yep.

And it's had an impact. The other is in businesses that involve kind of underwriting. So whether it's insurance or lending and the way that AI is able to kind of refine and in some ways really accelerate how well those companies provide that underwriting is, you know, so seeing that. And then the one that was supposed to be a meaningful driver of value in fintech for AI is sort of like replacing a lot of the customer service and backend. And you have Klarna, like famously, I think it was 18 months ago or something, like they replaced hundreds of employees with AI. But then like 6, 9 months later, they kind of backtracked and said, actually, like it wasn't working, we're gonna bring them back. So that's just one example, but like theoretically, you know, that's supposed to be an area that you see impact. In practice, I think again, it's been kind of mixed. Yeah. So I think there are these areas that, you know, within fintech that I'm seeing kind of AI produce interesting companies. But it's still in some ways early days too.

Yeah.

Yeah.

Yeah.

Where I'm skeptical is the AI revolutionizing something, you know, things like accounting and bookkeeping and Uh, because there's just so many companies, right? You have like 20 companies all doing, uh, probably more where it's like, oh, AI-enabled accounting, right? AI-enabled bookkeeping, AI-enabled ledger, AI-enabled, and it's, it's just FP&A. Um, and the issue there is not, not that AI isn't useful, it's just that like, how do you differentiate among all these companies? These companies all seem kind of the same.

Yeah. Yeah.

Yeah.

It's hard. It's hard to, it's hard to know which one is gonna be the one that's successful ultimately. 'Cause yeah, to your point, it really isn't much of a moat.

Unless it's the moat becomes, we'll say, well, Harvey raised like $2 billion or something. It's like, that's their moat. Yeah.

Yeah.

Because like someone put up a chart that was like the legal AI tech space. Yeah. And I could tell it was a joke or not, but we had so many names on there. You couldn't like read all the names. It was like hundreds of little logos. So it's just easier than ever. You and I could start an AI company this afternoon, just build it on top of OpenAI or Anthropic. Get going, right?

Which is also like marginally terrifying. You have to be terrified as a founder of like, yeah, am I just one demo day away from, from being irrelevant?

It definitely, yeah, that, that fear definitely exists, which is why I think you do have people trying to raise rounds faster, bigger rounds, because then the capital itself can become a bit of a deterrent. Yeah. Super, super solid points.

Awesome. Well, uh, as we wrap up, any, any parting thoughts for our audience? Anything we covered today or didn't?

Yeah, this has been great. I, I think this has been a, a good kind of look back on the past, you know, 20-plus years of the venture and tech business and, and hopefully look forward to where we're going.

Yeah. Um, Are you overall optimistic?

I am optimistic, but you know, I'm, I'm an optimist. I think here are two guys that are venture investors. Most of them hopefully are glasses half full, which, which is me.

Yeah.

Uh, so I tend to kind of, uh, have that, have that viewpoint of the world.

Absolutely. Well, uh, Cameron, it's been super fun to have this conversation with you today. Thank you for joining us on the show. Uh, for our audience, where can they find you if they want to, you know, keep up to date on what you're working on? Sure.

I'm on LinkedIn. I'm on X as Cameron Ansari. And you can find me at those places or Infinity Ventures or Capital Ventures. Awesome. Cool.

And please like and subscribe and share this episode with your friends. Thanks, everybody.

Thanks, Peter and John.