My guest today is Arianna Simpson, who has spent her career in an around the world of technology working at startups, Facebook, and now in venture capital as an investor focused on the world of cryptocurrencies.
I met Arianna when I hosted a panel at a big investing conference in New York City and she was one of the panelists. On the panel, I found her style to be very straightforward and compelling. It is clear that she loves to learn and that the best manifestation of her style of learning is investing in technology.
In our conversation we discuss broad trends in crypto that we haven’t spent much time on before: decentralized versus centralized exchanges, privacy coins, and evaluating a found or early team. We build a framework for learning about this new asset class, discuss the importance of travel, and the value of pushing oneself outside of comfort zones.
Hash Power is presented by Fidelity Investments
Please enjoy our conversation
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
2:12 – (First question) – How to teach someone else to build an investing philosophy around crypto
4:00 – The major risk factors to investing in crypto
6:28 – best practices for mitigating risk
7:39 – What factors to think about when it comes to whether a token will lose all value or not
8:39 - Taking a pulse of the investment community on crypto
11:36 – How she heard about and became interested in crypto currencies
12:34 – Are people really using crypto currency as a hedge against rampant inflation
13:52 – Investing thesis in the space
14:07 – Arianna’s systems for learning about cryptocurrencies and staying up to date on them
15:19 – Arianna’s take on the issue of increasing transactional through put
16:49 – Layer 1 solutions and making it all scalable on a blockchain
17:56 – her take on the fat protocol thesis
20:32 – Defining utility vs security tokens
21:54 – evaluating different coins
21:02 – Why cross currency swaps are important and how they work
26:17 – What are the chances of a scenario where there’s just one token and everything is built off of that one
28:02 - Comparing centralized and decentralized exchanges
29:47 – How the traditional investing world is going to regulate transaction involving cryptocurrencies and view security around those transactions
31:54– Impact this will have on capital formation
33:44 – Evaluating teams behind crypto companies
35:48 – The importance of gut when evaluating people
38:47 – How Arianna’s global upbringing impacts her thinking on the technology
39:51 – What countries or regions have had the largest impact on Arianna’s investing philosophy
42:41 – Doing things you’re not qualified for
43:59 – Gender imbalance in crypto and what can be done to shift that
45:28 – Most recent thing that has gotten Arianna excited in the crypto space
46:15 – Explaining Zero X
47:33 – How her views on reading have evolved
48:54 - Kindest thing anyone has done for Arianna
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub
Follow Patrick on twitter at @patrick_oshag
We’ve always found that even in public equities, you learn more once you have a live portfolio. One of the best ways to learn is to put some capital at risk.
To learn about the venture capital world, for example, I made an investment in a startup called Ladder, a platform business which connects coaches (fitness trainers to begin with) with consumers who need or want a coach to help them improve their fitness and their health. The idea is by making the entire coaching system more efficient, Ladder can provide consumers with a real person as a coach, but at a fraction of the cost, and provide coaches with both new customers and a much better way of managing their existing businesses. If you are interested in the businesses backstory, you can listen to episode #60 of the podcast to hear founder Brett Maloley’s story and his vision for Ladder.
We are now six months into the launch of the business, with thousands of users and coaches on the platform and run rate revenue past a million dollars. What I was most curious about at this stage, aside from building something useful, was the relationship between a startup and institutional venture capitalists, who are allocating capital from their funds into startups at various stages.
For this episode, I asked two VCs to sit down with me and Brett and treat the conversation as they would a normal pitch meeting, so that we, the audience, can get a peek into their world and the types of questions they ask.
The venture capitalists in question are Thatcher Bell, of CoVenture, and Taylor Greene, of Collaborative Fund. Both have experience evaluating new companies, but also have specifically spent time on companies like ladder, which follow the platform or marketplace model.
While we do cover a little bit of background on the company, I’ve edited most of that part out so we can talk about the business model itself. While I don’t spend much time talking in this episode, you will hear me asking Thatcher and Taylor some questions to better understand why they care or don’t care about certain aspects of a business.
Lastly, I love the data aspect of all this. The interaction between coaches and customers produces a wealth of data of different types, all of which is analyzed and used to improve each aspect of the process. To help gather more data—about onboarding, working with a coach, and tracking results—Brett and the Ladder team set up a little promo code for listeners, which can be accessed by going to joinladder.com and using the promo code ILTB2 as in Invest Like the Best 2.
The first voice that you’ll hear is Thatcher, and the next person asking questions is Taylor. I began by asking Thatcher to give us a bit of background on how he approaches young companies before diving in with questions of his own.
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
3:12 – (First Question) – getting a flywheel business going
4:49 – Brett’s background and how that led to the formation of Ladder
7:58 – Breakdown of the product
9:29 – The sign-up process
10:29 – Key problem for each party of the ladder transaction
12:34 – Diving deeper into the problem of being a health coach
14:29 – How does Ladder differentiate itself from other apps that help people locate a trainer
17:01 – A deeper dive into the consumer using this product
20:28 – The accountability factor being the moat for Ladder
24:12 - How successful is the product right now in terms of recruiting new customers and trainers
28:38 – Their pre-launch interview and research process
31:49 – Going from hypothesis to product development
35:25 – What should founders think about when doing customer discovery, even after they have a product in the market
39:22 – Optimizing in the early stage of a business
43:24 – The defensive moat of a startup
46:20 – Their take on their ability to corner the coaches in this market
49:57 – Is there a side of the producer/consumer side of the equation that is more important.
55:42 – Getting and giving value to your supply, in this case the coaches
58:22 – How to view different phases of a business
1:00:43 – Growing the supply and demand so that neither side gets aggravated
1:02:28 – Market opportunity for Ladder
1:10:55 – Top 2 or 3 goals that Ladder has over the next 12-18 months
1:13:00 – Looking at Ladder, what are the strengths and weaknesses as a potential investment
1:20:40 – Pros and cons of a startup seeking institutional VC money
1:25:11 – Reviewing the pitch
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub
Follow Patrick on twitter at @patrick_oshag
My guest this week helps me complete the first trilogy of guests on the podcast. His name is Nikhil Kalghatgi. Along with past guests Ali Hamed and Savneet Singh, Nikhil is a partner at the asset management firm CoVenture. If you liked those two conversations, you will love this one—it is somehow even more wide-ranging than the first two.
Nikhil is the CEO of CoVenture Crypto, but he ended up there because of an overarching investing style that he calls moonshot investing, which we explore right from the start and in great detail.
He is obsessed with productivity and happiness, and we spend a long time on those topics. One of the most interesting experiments I’ve heard about on the podcast is his Happiness project, for which he interviewed more than 100 of the wealthiest people in the world. The lessons he gleaned from those conversations are very helpful, and I won’t soon forget the lesson related to sacrifice.
We also discuss asteroid mining, networking, shared experience, and philosophy. Oh and crypto currencies. Nikhil’s take on crypto has always been refreshing to me. In fact the first time I met him he was throwing cold water on a room full of enthusiastic crypto investors. Within crypto we discuss business opportunities, mining, and how new retail and institutional capital will affect the asset class.
Hash Power is presented by Fidelity Investments.
Please enjoy this sparkling conversation with Nikhil Kalghatgi.
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag
Show Notes
2:42 – (First Question) – What moonshot investing is
4:41 – Creating sustainable differential investment advantage
9:30 – Assessing the market for moonshots
12:15 – Types of people suited for moonshots
13:42 – The Happiness Project
17:45 – Commonalities among successful people
25:15 – The importance of humor in life
17:16 – Recipe for a good joke
28:00 – The night Patrick and Nikhil met
29:17 – His perspective on the world of venture capital
33:26 – What did Nikhil learn from his time at SoftBank
34:52 – Craziest thing Nikhil has done
40:27 – What he took away from his time in military intelligence
46:10 – The idea of manufactured serendipity
47:13 – Nikhil’s approach to investing in cryptocurrency and what he finds interesting about it
53:23 – How Nikhil reconciles the excitement of crypto with the lack of tangible asset
58:10– The timeline of retail and institutional investors becoming more involved in crypto
1:02:43– Exploring their liquidity strategy
1:04:10 – What happens if regulators shut down the cryptomarkets
1:09:48– The role of miners in crypto and how that might change moving forward
1:10:43 – What is the frontier of crypto mining
1:12:31 – What’s the most compelling rabbit hole in crypto
1:16:23 – How would the original creators of crypto currency feel about the current state of the market
1:20:01 – What Nikhil sees as the value proposition for the whole ecosystem.
1:21:00 – Kindest thing anyone has done for Nikhil
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub
Follow Patrick on twitter at @patrick_oshag