Jessica Livingston: recommendation

Transcript context

…So I wrote down a few of the things that you mentioned you look for, and you looked for in the early days. So let me just share a few of them and let's spend a little more time here. So you looked for, did the founders get along? Are they committed to the idea? Are they ready to quit their job? Are there any red flags? So is there anything else that you remember you spent a lot of time thinking about or looking for then or even now? There's looking for in the application and then there's looking for in the interview, and now we have software that looks for all of the red flags in the application that I used to do by hand. In the application, I'd look for just weird things, like was there a huge gap in the equity allocation? Did one founder have 99% and one founder have 1%? That's weird. I'd want to dig in on that. That doesn't feel right. Are they going to quit their job? Are they going to move to Silicon Valley? What are their current shareholders? Is like 90% of their company already owned by someone else? There all these weird things that we like to just flag. And we wouldn't necessarily not fund someone because of them, but it's just more data. So that was in the application that I'd look through all of those. But in the interview I definitely was sort of, one thing I remember I would always look for was, when you'd have a conversation with us, a lot of times, Paul especially, but Robert and Trevor, would really be getting right into the idea and questioning you, and how do you know this? And what about this? And if a founder would get defensive, that was always a bad sign, always a bad sign. The best founders would say, "Gosh, I have thought about it and here's what I figured out." Or, they just have this almost a tennis match and a conversation rather than closing up and feeling like, oh, this person's interrogating me. You could just sort of, the open-mindedness, the flexible-mindedness of people was really important. I'd get really excited about domain expertise. Like my co-founders, we all loved that. If someone was fixing their own problem in a broken industry, we loved that. Definitely, I'd look for co-founder relationships. And again, I'm not saying I was always right, but you could tell if... One founder, I'll give a story, one founder, once we asked a question and one person started to respond and the other founder put his arm in front of him and said, "I'll answer that question." And it was just so weird that he wouldn't let his co-founder speak. We'd have situations where we'd call people like hackers in a cage, where it's kind of obvious there'd be a business founder, business person, who had clearly convinced a programmer to join the team. They were given, the programmer was given, very little equity and just we called them programmers in a cage, like hackers in a cage. And sometimes that works out, I'm not saying it doesn't. But I'd always try to observe, okay, does this hacker in a cage have any say in the company, the direction of the product? That sort of thing. Because the programmer needs to have opinions. It's so funny. I love this metaphor. And I totally get what you mean. I want to unpack a couple of these, because this is exactly where I was hoping we'd go. So this idea of looking for defensiveness and being open to change and being flexible, why do you think that was so important to successful founders? Why did you look for that? Why was that a predictor of success?…

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