Alfred Lin: evaluation

Transcript context

…When you get to the landscape stage, whether you’re looking at a space as part of a team at the firm, or maybe you’re looking at a specific investment and you’re doing due diligence on that investment, what are the key things you’re trying to understand? Don and some of the old... like to talk at GSP, oral history with him. He talks about needing to understand what the change is that’s occurring in the market, needing to have a very specific problem that the company is solving, needing the timing to be right. What are these key features that you guys are focused on? The simple questions are you’ve heard before, that is why now? What many of these ideas have people thought of in the past? It’s not the first time that someone has decided that we should deliver food there. In 1999, there was a company called Cosmo that opened up in New York. That didn’t work. Why is Instacart in a much better position today than they were when Webvan started and Webvan didn’t work? I think there are specific good reasons for ‘why now’ and there are times when there’s not a good ‘why now.’ In Instacart’s or Doordash’s case, the ‘why now’ has a lot to do with mobile and the on-demand economy. People have always wanted instant gratification, but the ability to get an on-demand workforce was not available in 1999 because not everybody was carrying a mobile phone. There are certain situations where you have good ‘why nows’ for a particular company to be able to take off. The other question we ask all the time is, in 10 years who cares about this company? Tony used to ask who cares. It applies to who cares today but it also because we’re investing early and we partner early. We partner at the idea stage, at the seed stage, and the venture stage, at the series A. The company has to be an important company 10 years from now, so who cares 10 years from now? What does this company become in 10 years and now? Imagination about that and what happens when everything goes right is really important. We do ask, if everything goes right what does this company become? In the early stages, it’s easy to spot why the company may fail, but it isn’t quite easy to write the premortem of a company. What will go wrong? What are the major risks? It’s sometimes very hard to really write about what this company can become. Do you find that founders know this at the seed stage? David and I know this from meeting with very early-stage founders, that so much is going to change in the dynamic market over the next 10 years. Do great founders know what the right picture looks like? Is the Brian Chesky of today able to fully articulate that they’ll overtake hotels?…

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