Yesterday Nick published a post about USV's thesis-driven approach to investing. We also updated our About page. There is a section called How We Operate that I love. I have had a lot of conversations lately about why I joined USV and why I think it's such a unique place. I wrote about my relationship with the firm over time, but that was only part of the story behind my decision. The rest is encapsulated by this tweet that Andy wrote:
1/ small funds for 15+ yrs (last core fund $275M)
2/ "vehemently" generalist - everyone invests in every area of thesis
3/ completely collaborative investment decisions, made as a collective
All of these attributes are very important and unique, especially for Founders that choose to work with us.
To me, the beauty of venture capital is about the alignment between the investor and the entrepreneur. Managers of small funds make money the same way founders do, and there is something very romantic about this and it deeply resonates with me. Small funds like USV can deliver venture scale returns through concentrated investments in early stage companies. By design they are required to focus on Series A and seed. This is exactly where I like to focus because as a Founder the investors I partnered with at this stage were the relationships I cherished and found most helpful on my journey. I don't think there is a perfect fund structure in venture capital. There are many ways to do this and firms have been successful pursuing different approaches, but small funds are my strong preference and I think create the best alignment between entrepreneurs, fund managers, and LPs. Fred has written some excellent posts about this here and here.
Thesis-driven investing is important because it reflects that you know who you are and what you stand for. I also think it's also an entrepreneurial style of investing because you are painting a picture of how you think the world will unfold over the next 5-10 years and what you want to happen, and then strategically using financial capital as a tool to realize that vision with like minded entrepreneurs. A strong thesis helps Founders understand how an investor thinks and what motivates them beyond financial returns. Being generalist means that we can maneuver across social applications, marketplaces, web3, fintech, health, education, climate and more. This enables serendipitous things to happen in portfolio construction and for people to transfer learnings across all these different areas. A lot of the most compelling and exciting opportunities happen at the intersection of different fields and being generalist equips you to play at these intersections, which are often at the edge.
It was very important for me to join somewhere where partners work together as a collective. USV has long prided itself on being an equal partnership. I think this is the ideal model that creates a set of aligned incentives across the firm, and I fervently believe that incentives drive behavior. When there are no politics or people vying for a bigger slice of a pie, magic happens. When things are done collaboratively and equally, everyone roots for each other and the only winner is the team. This means that everyone is all in on every investment because everyone has a meaningful and vested interest in the success of a company and entrepreneur. When people work with USV they get the whole firm and that is quite rare and special.
Andy's tweet was less than 280 characters but it is loaded with meaning. The implications of these defining characteristics determine how the firm works and how an entrepreneur experiences USV, and they're one of the major reasons why I'm here today.
For the last several weeks I’ve tried to use Perplexity as my default search engine on mobile. I’ve enjoyed the experience more than Google and ChatGPT and I’m going to stick with it for now. I don’t know if my usage will last for a long time, mainly because I think other search applications will quickly innovate on user experience and that for the first time in decades this will be a hot and competitive market.
One of the new behaviors I noticed for myself was that I now like to use voice as an input to search. I’ve always been a typer, especially on mobile. But new AI powered search results actually improve as my queries become much more specific and detailed, and voice is a more seamless and natural way to make this happen. Instead of a quick text blurb, a conversational approach to search now yields superior results.
Voice as a part of UX has been around for a long time (eg Siri), but I think we are about to see it explode in usage. A key part of that is the movement to natural language as the fuel by which we make software do things for us. I no longer think of voice as just an input, I think of conversation as the new UX. This leaves many open questions, like will people be speaking out loud to their personal devices all day long? Is that preferable to being hunched over our phones tapping away? Will we be comfortable expressing our private interactions with software out loud?
Yesterday I wrote my first post on the Union Square Ventures blog announcing I am joining the firm as a Venture Partner. I've been reading everything on USV since I started in the NYC startup ecosystem in 2009, so it was a special experience to see my own words on the page. I feel very fortunate to have this opportunity.
Even though I just joined the firm, I've been connected to it for my whole career. At tumblr I had the privilege to join board meetings as a 22 year old where I watched and learned from Brad where he was a board director. That's when I learned that "good board members listen first, then talk." I have worked with Andy since 2010 when he became GroupMe's first lead investor at betaworks. For the past decade I've continued to learn from him on the board of Splice which was founded by my dear friend and longtime business partner, Steve Martocci, who is a two-time USV founder. So much of what I wrote about in this