Fact
Network capitalism, not industrial capitalism
Maples explains why he invested in Lyft, Tesla, and Apple as software-defined, network-centric companies. Lyft replaced centralized taxi dispatch with an algorithmic 'invisible hand' matching riders and drivers; Tesla is 'a car company animated by networked capitalism.' He predicts these companies keep displacing incumbents that merely use computers to make industrial processes faster.
“And so why did we invest in Lyft? Lyft was a more modern way to think about getting a ride than taxis. Taxis are a centralized, command and control, tops-down, dispatch-driven technology. Lyft says, hey, riders and drivers can advertise their presence in real time on a network, and algorithms will form an ad hoc connection. So it's kind of like this return of the invisible hand.”
Number
90% of VC profits come from companies that started out as something else
Maples argues a startup isn't a company but the founders' insight and talent, citing that 90% of his fund's profits came from companies that started as something different: Lyft began as Zimride, Twitch as Justin.tv, Okta as Saasure, and Twitter nearly launched as Voicemail 2.0.
$90
Share of VC profits from companies that pivoted from their original idea · percent
“But like Lyft started as Zimride, and Twitter, they couldn't decide whether to call it Voicemail 2.0 or TWTTR. Uh, uh, Twitch started as Justin.tv. Okta started as Sasher. And so like, what do you do with the fact that 90% of your profits come from things that started out different?”
Framework
Jazz band, not a marching band
Maples' team mental model: startups should run like a New Orleans jazz band where the lead riffs and everyone improvises along, not a marching band with sheet music and assigned dance steps. He also lays out the breakthrough sequence: insight, then product breakthrough (product-market fit), then growth breakthrough (escape velocity).
“In a startup, it's more like when you go to the French Quarter and you watch a jazz band there. The guy, the lead, goes on a riff and everybody else just goes with it, and you'll never hear that tune the same way ever again. But everybody knows that that's what they're in it for. And nobody's saying, hey, that's not on my sheet music.”
Tactic
Buy distressed brands with debt and warrants, keep the equity
Tai explains he and his partner fund acquisitions with their own money plus an accredited-investor pool built since 2015, using debt and warrants rather than equity. The goal is to own almost all of every deal, unlike VC-funded founders left with tiny stakes.
“All these deals I've done, fuck 2 and 20 funds. Me and Alex own almost all of these deals. Why? Because we build an investor base that trusted us. That's not institutional. All these guys raising in Silicon Valley, look at the founders of Lyft. These dudes have sub-4% of their business left. So yeah, I mean, maybe Silicon Valley is full of brilliant people, but you also have to maintain equity in what you own.”
Steal thisFund acquisitions with debt and warrants so you keep most of the equity instead of diluting to investors.
Idea
Make a mortgage refi a 10-minute online flow
Shaan pitches an idea born from his own painful refinance: a product that shows your current rate vs. a cheaper market rate and lets you refinance in 10 minutes online. He says he'd invest in whoever builds it.
“But it should be as simple as, hey, here's your current rate, here's the rate you can get on the market that's cheaper. If you'd like to refi, 10 minutes and you're done. That's how it should be.”
Steal thisCompress a painful, paperwork-heavy financial process like a mortgage refi into a rate-comparison plus 10-minute online checkout.
Number
A $200M deal vaporized by one Facebook algorithm change
Sam tells of a friend whose media company was about to sell for $200M last January; Facebook changed its algorithm and the company was out of business by March. He uses it as the cautionary tale for any business built on one platform, like Firefly on Uber/Lyft.
$200M
Pending sale price of company killed by Facebook algorithm change · USD
“I know a guy who had a company that was about to sell for $200 million. Last January, Facebook changed their algorithm, and it went out of business in March.”
Fact
Nearly every early unicorn broke a 'Silicon Valley rule'
Jack regretted following VC norms (no family/husband-wife teams, no co-CEO/president split). After leaving, he found that of the ~20 unicorns then existing, almost all broke one: Eventbrite (husband-wife), Stripe (brothers), Lyft (CEO + president).
“When I looked at them, pretty much every single one broke one of those rules. Rules. Um, Eventbrite is a husband and wife team. Um, Stripe, they are brothers. Um, Lyft, one of the co-founders is CEO, the other one is president. So kind of there is no rules in Silicon Valley”
Fact
Nearly every early unicorn broke a Silicon Valley 'rule'
After leaving Vungle, Jack found that of the ~20 unicorns at the time, almost all violated conventional VC rules: Eventbrite is a husband-and-wife team, Stripe is brothers, and Lyft has one co-founder as CEO and one as president.
“When I looked at them, pretty much every single one broke one of those rules. Rules. Eventbrite is a husband and wife team. Stripe, they are brothers. Lyft, one of the co-founders is CEO, the other one is president. So kind of there is no rules in Silicon Valley, but at the time I kind of went along with different investors telling me.”