WH150: Dan Levitan (GP, Maveron) and Elana Levitan discuss consumer-centric, media and wellness markets

Hey fam, what's up? It's your homey Afoel back on the mic. This is a short message from your host. You can skip this and jump directly to the beginning of the regular episode at about the three, four minute mark. Just check the episode notes for the exact timestamp. You may have noticed that we've gone a little quiet on the whiskey hue feed lately. And no, we didn't disappear. We didn't get canceled like many thought. I was getting texts about it, trust me. And I promised nobody went off to join a spiritual retreat and Palm Springs. You know, like learning yoga from some dude named midnight sunshine in California. 'Cause that's about as authentic as Mexican food from North Dakota, baby. Here's the real story. As you know, we made the switch from audio-only recordings on squadcast.fm, solid audio, buttersmooth every time to their new parent platform, Descript. So we could bring you video podcast. That was the goal. More content, more engagement, more of our guest expressions, reactions, eyebrow raises, all of it. And you have a video looked amazing. I gotta give it to him. But the audio? Absolute trash. (laughs) I know it's harsh, but editing it became an Olympic sport. Think lip syncing issues, phantom background noise, and some like weird sound grime lens, we didn't even know existed while we were recording. It was like training a Ferrari for this incredible spaceship, beautiful technology, but no idea which buttons to push to get the right result. So now it wasn't just me fixing it. I have my phenomenal editor, who has been amazing, all for the last several years, and myself, and I know my way around at Editing Board. I was a musician for a while and worked in studios, all for like five, six years. We tried for two, three weeks to get it right. And we would figure something out, and then all of a sudden, three new challenges were unlocked. So then I brought in a valid backup. The team that put together my entire on-demand VC course, ideation through execution, they tried to edit this thing efficiently as well. Those guys created 60 videos for me. Even with all that firepower, we were wrestling with the many quirks of Descript, and every time we figured something out, three new problems would arise, and it was just never ending. So here's what got held up. We recorded three amazing episodes, or shall I bring it to you? One was with Celine Shore, journalist and only fans creator who brought fire inside. Like I really wanted to learn that business model. And another was Lizzie Locke, a spiritualist with a mind opening conversation, and then the legend Dan Levitan. Investment banker turned VC mogul who took Starbucks public, co-founded Maverin with Howard Schultz, and backed companies like eBay, Zoolily, and more. So he's crushed it, right? Phenomenal conversation, his daughter Ilana, one of my former brilliant students, joins the conversation as well. The conversations were absolute gold. So I was just yearning to bring those to you. But because of all these editing challenges, we couldn't deliver these to you in a regular timeframe. We pride ourselves on turning an episode around within five to seven days post-recording. This time we've been stuck in audio limbo for five to six weeks. It's been a nut show. Like we recorded these early June, it's now late July. In the meantime, I did launch a YouTube channel at a Thuel Proşar investing, ATUL, PR, SH, AR, investing. And that's where these were gonna go. But we are placing some of the other investment videos there. It's filled with Chris Videos on private VC markets, public market takes, and high leverage ideas. And a lot of things I talk about around celebrity brand deals and endorsements around startups. So all that's there. So check that out. But eventually these video podcasts will get there too once we get sorted all out. So if you haven't had already, just please get on to that too. Until we crack this Descript Code. So here's the ask. Thank you for rocking with us and being patient. I've received some wonderful texts, email, "Hey man, where's the pod? "I miss it. "It's part of my routine. "I appreciate that. "I'm building this show to be a place "where learning is fun. "The information is actionable "and the vibe is always top tier. "We'll get through this hiccup. "And once we do, we're dropping fire episodes back to back. "We're gonna continue doing the audio now. "I just gotta get back to it "because I miss people. "I have a backlog of like six, seven episodes "from before too. "And then about seven, eight guests "who've reached out that want to be on the pod. "I keep holding them off "because this whole challenge we're kind of loop we're in. "So we're hopping back to audio for the time being. "You'll notice the audio quality in this "in the next two episodes. "Maybe it varies here and there. "But keep listening through these short pockets "and you'll find great information "from our amazing guests. "I appreciate you. "Stay locked in. "Big things are coming." Monkey love to you. Bye-bye. We are back. The Whiskey-Hew bringing you the latest in tech business and startups mixed with Whiskey and a ton of sarcasm. Q, the music. (upbeat music) - You long and damn. Welcome to the dance here if you'd like. Go for it. This music coming. (laughs) Dang, got into it. - Thanks to you. - Thanks to you. - The young ones. (upbeat music) Can't get 'em to go. All right. (laughs) All right. Welcome back everybody. This is part of the ProfP series released through the Whiskey-Hew stream. We talk about tech, business culture, generally from sports to media and how you can invest in the space and win. We're gonna do all that and above today. We have some superstars with us and I'm gonna tell you why I appreciate both of them. Very quickly. Today's guest, let's start with Dan. Dan Levitan. Am I saying that properly? Levitan or Levitan? - Levitan. How many names rhyme? Dan, Levitan. All right, then since you correct me, do you mind saying my name is a fool instead of a tool? Just, just a way that's fine. - Okay, cool. - It's like ATHual. You don't have to get Latin pool boy on me, Dan. (laughs) It's just that the, oh, sorry. All right. (laughs) Today's guest is a true force in the world of venture capital. We're honored to welcome Dan Levitan. Co-founder and partner at Maverin. The legendary consumer focused VC firm. He launched alongside Howard Chelsea. Like the how I do this case, you can tell I'm kinda reading a little bit from the script. I want, you have such an extensive background. I want to make sure I got some cool things in. Okay, Dan's career has been defined by bold bets and cultural impact. He helped take Starbucks public and invested in over 300 companies, so so on your site. And some very prominent ones that we all know, game changing companies like eBay, Zoolily, Shutterfly. And I'm gonna do an honorable mention on this pot belly 'cause I'm from Chicago, originally. That's a Chicago little corner star for us. And that's just warm my heart when I saw that on your portfolio as a port co. I'm the name Maverin. Maybe she'll let you tell this story. I mean, it's just a combo of two words or she want me to just keep running. Dan. - No, whatever you want, a stool. We are here on your podcast. If you want me to run away, I'm glad to. - Okay, run with it and then I'll give Alana. You know, I want to make sure I get to Alana though. So how about we'll let you run. Do tee up the Maverin in a moment. And then that was a very short interview. I had something much longer we'll get into the rest of it. Ilana Levitan, before we dive into all of this and it's very, I'm honored to have her, a special shout out to her. She is kind of the reason we're having this conversation in the first place. Stand out student of mine this last semester. And just happened to casually mention the first day or two of class and hey, my dad's in this space. And I kind of want to sound like I know what I'm talking about when I'm at the dinner table with them. I had no idea who your dad was at the time when we didn't go that far. But you said, okay, I said great. And I asked you what kind of company Z invest in. You said, you mentioned a few. You mentioned Zoolili, I think all birds. And I said, oh, that's cool. It's not sports and media per se. But you kind of shared a little bit of who he was without going into too much. And I said, oh, this would be a great speaker for the class if he's open to it. And you made that happen. We got it in kind of in the final weeks of it. But a lot of sharp, very thoughtful, driven. I appreciated having you in class. Representing hopefully the next generation of leaders and venture, do we tee you up enough to get into that space? We nudge you a little bit. Give me just give me a head. (laughs) All right. It's extra meaningful to have you on joining your father because whiskey who recently partnered with economy. I think I mentioned this in class a couple times. It's a global media platform empowering millions of women through education and opportunity and finance tech leadership. And they do a lot in women's health around the world. So I don't do much in the latter. A lot in finance tech leadership and just talking about topics in that space and kind of exploring it for them. And they recently liked us and they partnered with whiskey, he was because we kind of have a lot of female powerhouses on here. We have, I mean, even realize it's just, I'm just trying to get powerhouses on here. We've had those, they appreciated those conversation of celebrating women. So just love having you on as a perfect role model for a lot of the women listening to this around the world, joining your dad. Now, sir, please, Maverin. So I don't steal the thunder. Please share with us how you derived on the term and then we're gonna jump into the meat of everything. So Howard Schultz is very focused on, building startups from the ground up in a thoughtful way. And he frequently uses the analogy. If you're gonna build a hundred storage skyscraper, you've gotta get the foundation and the corners perfectly. And Howard would say the name of any company is part of that foundation and cornerstone. And so Maverin is the merger of Maverick and vision and Maverick shockingly comes from the English language. There was a guy in San Milla, Augustus Maverick. He was born in 1803 in South Carolina. He ended up going to Yale. He ended up being the mayor of some city in Texas in the 1840s. And he was playing poker. And for whatever reason, the hand they purse was 300 head of cattle. And he won that hand of poker. And no one knows why, but he refused to physically brand his cattle with his own branding iron. And back then cattle roamed a little freer. And the unbranded cattle became known as Mavericks. And given Maverin's consumer centrity, we felt a physical unbranding. And the whole story of Maverick was a great part of our foundational name. - I love it. I thought it was Tom Cruise this whole time. So, okay, it was him, okay, it's him, because I love that. I love the history on it. And I saw that you're a Duke graduate as well. So you got Cooper Flag, obviously Zion, Grant Hill, Jason Tatum, a lot of superstars. Jay-Jay Reddick, I think, is from there as well, right? Mr. Luke. - Liger's coach. - Is he okay? And a slew of others. But those are some that stick out to me right away. And I have a lot of friends who came through Duke. But, and are you, do you go back and do things with the university still? - Yeah, 100%. I'm very involved with the NIL collective that helped Duke basketball in today's world. And I've been privileged and honored me and two other guys to work with Coach Shire and standing up our collective. - Oh, I love it. And then, so we should chat on that because we're doing a scout is out there. There's another group called, "The My Buddy." He played for the Seahawks and he's there now. Athlete Mogul, is that the name? Do you know that name? - No scout. I don't know the other one. - Okay, scout one by my-- - NIL is a wild west right now. - It's fragmented as well. - Startups, yeah. - Yeah, and we'll see. They really need a couple just to kind of consolidate a lot of this. And then, there's opportunity for a lot of folks, but they should kind of have a centralized kind of platform per se, a few. You don't need just a couple. But that's exciting. So Alana, you did mention that you poured a drink for you and your father. So let's just share the story behind the drink. Please. (laughing) - The story is not that entertaining. It's just what we had in the fridge, which was orange juice. So orange juice and vodka, which is my liquor of choice. - Seriously? Vodka's your go-to? - Yeah, I feel like Tequila makes me a little cray cray. And whiskey, I don't like same with Jen. - You hung out with me for 14, 15 weeks. I like cray cray. You should, you get that, but-- (laughing) Okay, so I haven't, okay, Dan, you may not like this. I haven't been able to drink vodka since high school. I had it a little bit too much at one party, just one. And this is not for me, but it's not my thing. But good for you. But okay, Dan, any special tie to that drink or is it because your daughter poured it? - Totally because my daughter poured it. I think it's interesting, though, as a consumer investor, to watch the trends in alcohol and in wine. And it's talking to me how much growth there is in non-alcoholical turnips, you've seen a number of brands like the athletic, but in different categories. So I think it's just astonishing how the spirits businesses down and the wine businesses slow down as well. Being older, it's hard to drink and then sleep well. - Are you, are you getting involved in the space at all? I know you do a lot of consumer really, but are you doing CPG? - You know, we did one energy drink earlier this year called Lucky Energy. - Okay, right. - But other than that, we haven't played big in beverage. We backed a second time founder in a company called Goodbelly. He had created silk. But as we found out in that, although silk was a multi-billion dollar business, Goodbelly had a harder time. It was a probiotic juice company. Now it's owned by General Mills. - Yeah, and I, so that's a lot of these, they get celebs attached to them. They can get the valuation a bit higher and you get a quick exit. A lot of these within sometimes two, three years and a phenomenal exit, right? So less than five, sub five years, right? Mariah Reynolds did it with the aviation, Jin, George Clooney, all these folks are doing it. It's fascinating, but that I tried, I remember looking at a whiskey, the New York one, called Hudson Whiskey. I tried it, my wife took me there at a special birthday of mine and up to the distillery we tried it and they were looking to raise. I thought about it, didn't do it. I see it everywhere now. It's in bars and it's, I don't know if it's middle tier, I don't know where it kinda sits on the spectrum. I don't, it's not a go-to for me, but I looked at the market and saw that hey, you need this to be, it has to be celeb driven. This is the marketing play on whatever you're putting there. Maybe not celeb, but marketing plays, especially. Then I was looking into these things recently, like you mentioned probiotic, there's like, who's the models, the two sisters, a Hadeed? She's doing, you know, not, she's doing, what do you call them? Something that makes it's like, Appdenix, there's something you don't talk about. - I don't think it's Appdenix. - I'll get the name for you, I have it right here somewhere. But it's fascinating and it kinda, it makes you just sharper with, it's a non-alcoholic confusion, but infused with all these things that kinda make you think sharper. Nick contains a thing that's hitting, but that's still addictive, so you kinda wanna be careful with that, in my opinion. But yeah, all these things are hitting the market and a lot of them, like what, what's his name has done with Prime, the two YouTubers like Jake Paul and the other KSI, I think, my kids know who they are. So it's fascinating, but I just don't, it's a quick in and out draw for a lot of these things. You have to be careful, right? So your world may be kinda wise to kinda just be careful when you enter that space. But talk about some of these, 'cause when you came in, again, it was fascinating to have you in class. I think probably are, most, I don't wanna put the other, I think you're very popular. You're one of our top, I don't wanna put the other folks in a different bucket, but one of our top speakers of the semester, and we've had some phenomenal speakers. We really have, right, throughout the years, and you were fantastic, then, and then we posted about you, and everyone just went nuts. Everyone knows you, you're a superstar. So jump in, you had these 10 lies, I don't know if you wanna talk about it, the 10 lies Adventure Folks always tell people, or that 10 lies will eventually capital, that's how you teed up your conversation that day. If you wanna jump into that or any space, take this where you want, because you have done everything, and a lot, I would love to hear your aspect on a lot of these things, your take. - Well, I just think that Adventure Capital is cool and hot now, and I think that's wonderful, but I think it's important to understand it, and it's changed radically in the 27 years I've been involved, and the size of the assets focused on venture, the money raised every year, the number of companies invested in has gone up, and it's just, there's a lot, lot, lot, lot, more participants. But I think it's much easier to raise money, than replicably make money. And so in my 10 lies, one of the lies is believing that it's not about grand slam home runs. Private equity is about making sure that you get between 10 and 35%, IRR on every deal. Venture is less about batting average, and more about how many grand slam home runs do you get? - Right. - And in Maveron's case, we've been defined by our 50 to 150 times money investments. The second, I mean, there's 10 lies, so I won't go through all of them, but the second lie is really, I think that it's all about being opportunistic. I refute that. I think focus beats optimism. We're living in a world now where, deals flow pretty efficiently. And I hear from entrepreneurs all over the world starting a consumer business, or would you be interested? They're not sending me the best cloud businesses because they know that that's not what Maveron does. So I think either as an investor or as a firm, you should define your swim lane, focus on creating a prepared mind, and study things before these opportunities come to you, because I think it's easy to get lulled into believing that you see things that most others don't. And if it's a space that you're not familiar with, I think that's highly unlikely. Getting back to lucky, getting back to lucky energy, as an example, I didn't know the energy drink business very well, although shockingly, what do you think the market cap is the largest energy drink company, monster? And what is it as a percentage of Starbucks market cap? - You did ask this question, and I should remember it. Alana, help me out. Help your old profile. It's massive, and monster and red bull, and all those folks are massive. I do not know the number of hand. I could Google it, but you know. Monster is market cap. I haven't looked at it in the last few weeks. About 60 billion. - Oh my God, geez. - It's a little more than half of Starbucks market cap. - On one, pretty much a couple of skews, right? They've only, well, they have a couple of brands, but yeah, they've been spying brands, but my point is energy drinks, Starbucks and monster are kind of in the same business in terms of providing the dissemination of caffeine into people's bodies. But it speaks to the repeat nature of these products, and the need that people have to find their brand and drink it. But my point is, and then I'll let my daughter chat. I didn't have a prepared monon energy drinks, but I had a friend for the last 25 years who ran Red Bull North America 15 years ago, and he did that for eight years. He knew the energy space very well, and when I called him and he started helping me diligence, that's when we thought began to realize that Lucky was special, because he had a totally prepared mind. He knew the distributors, he knew the retailers, he knew velocity numbers, and he was up to speed. Now, with things like chat GPT, you can get smarter faster clearly. And chat GPT and the other large language learning models can create pattern recognition for you, where you don't have it. But I think judgment, chat GPT isn't yet great on judgment. - A lot of us probably, you're younger, so you're out in the market here trying to pick up some of these things. So Starbucks, that's a physical location and you have to go to often, right? So there's that overhead. Monster was able to do this partnership and the distribution channels, right? And then, so there's less overhead for them to get to that market value, as long as the product is phenomenal and it's sought after, it was an easier, easy lift relative to Starbucks. Starbucks is changing a lot of their internal, kind of, where I used to live, it's now just, pick up only, right? I think it's what people are preferring now. There used to be seeds there. I think they wanted to maybe get rid of potentially, people hanging out, maybe getting one drink and staying for three, four hours with their laptops, potentially, or they're running into other kind of challenges. So this is quick, in and out type of thing, which is great. A lot of what do you, do you drink these kind of things, like the monsters and the Red Bulls of the world? No, I don't like the taste of Red Bull. That's enough. OK, Dan, I'm kidding. A lot of-- you don't like the taste of the energy drinks. I haven't really tried many to be fair, but Red Bull, I won't drink just because I think the taste is like a delicious person. The people mix that with vodka. Read it all. I know I can't drink it. I can't drink it. Lucky has a new flavor called watermelon candy. And it's coming today, and I'm going to have along the triad. But she's a pretty basic cold brew coffee person, correct? OK. OK. Keep yourself on mute. I'll add it to that part out. Unmute. Stay in. Stay in the conversation. So OK, so you're a coffee brew person. That's your thing. So you'll hit like a Starbucks often. And it's only Starbucks, correct? I'm kidding. We can't feel-- Well, like-- Well, like-- Well, like-- Where we are now, like I buy like a Starbucks cold brew, like containers from the super market. And then I'll do that at home. OK. It's easy. Or I'll go to Starbucks, like if I have it at the time. That's fantastic. Yeah, it's good. Some of these in-- like this Bella deed. That's what the name I was looking for. She offered that drink, which is a non-alcoholic kind of seltzer type play, where it infuses where you make your mind sharper. So a lot of those things are going to be coming into the market. A lot of people prefer those. And they appreciate those, right? I think your generation, they're drinking less than we did in my generation, and I'm assuming. And I heard they're going to other avenues to hit whatever they're trying to hit. But it was just straight drinking alcohol for us. And then I guess wine and beer, everything consumption is down significantly, right? From the last 15, 20 years. And so these other things are taking their place. So that's interesting. Are you enticed by this space? Are your dads really crushed it in? Yeah, I think to me, the more interesting ones are-- like I think Zoolily was pretty exciting. Or all birds, I'd say, wasn't old enough to remember the eBay days necessarily. But obviously that's a big name there. Necessary is one that I get excited about. It's like a beauty, body products, and like shampoos and conditioners. I think they have great stuff. Dolls kill is also a big one. If you go to concerts or music festivals, it's like a tire for that. A woman's a tire for that. So that's fun. I did love Pinkberry. But that might be controversial to my dad. What other ones I'm trying to think? Well, but you're more interested in-- you're more interested in the world of media and creation of entertainment product than most of the stuff I invested in, right? Yeah, yeah, 100%. So we should chat. How many movies have you seen in your life, do you think? Over 5,000? Growing up, my dad, a tool would always give me shit for watching so much content. And now that I actually want to do that with my life, I feel a lot better about my life. That was a big topic of contention in my house. Do you want to be a filmmaker? Is that something that's coming down the future? More like production development realm, I'd say. Did I not know this? I didn't know this about you at all. Ish. Yeah, I don't know if we got into a combat. Well, let me know you need. Go with your dad probably knows everybody. But let me know what you need. Because we have a smallish fund, which is a film fund, which we're kind of getting behind something pretty cool. I don't know if I should say this is going to sound inappropriate. I don't mean it to be. They're not like the time cruises of the world who are associated with their definitely high B plus people involved. Is that horrible as they? They're just not time cruises, right? And most people aren't. OK, I can say that. But the one that we just got back right now, we just put some capital into his features coming about it's kind of a modern retelling of McVeth. But they're all like B plus-esque, and they've done really well here. So we're excited about it. But let me know. We can chat offline if you're interested in that space. You're probably doing something already interesting. Getting back to the point you made earlier, you see there's a lot of people jump again to venture because it's sexy-ish. They're seeing-- they see the outcomes on some of these-- they're outliers, right? A lot of it could be equity markets. The public equity markets are turned a lot of capital. So there's a lot more capital. A lot more people have the opportunity to become LPs and kind of participate. So they're flooding capital into the markets. They say, hey, I want to be-- I don't want to run the fund, but I want to put capital in. And then it became all too easy to raise capital because it low interest rates for a long time. So everyone thought they could run a fund. It's incredibly difficult. You have a slew, probably like 20%, 30% of funds in the last four or five years. Now, who raised during that COVID time? I think a slew of 20% or returning the capital to their LPs now? It's an easier exit than trying to just say, I'm going to lose it outright. So you're seeing that. And then the true stalwarts like yourself stay in. I don't know if you remember when I introduced you to the class. I said, you're-- and I meant this-- most compliment because you could see by the canvas behind me. I said, I'm the LeBron to your Jordan, because I'm in the space as well. LeBron's a beast, but he ain't Jordan. Alana's heard me say that. I put in quizzes. I'm just kind of weird about it. So I'll put it as extra credit points and quizzes. But you are like the Jordan of this space of a lot of the people that we've had come through to it. And who's the goat, my mean? I'm just defining that versus others who are in the space. So share with us what you thought. I just threw a bunch of nuggets at you. Share with us what you will around that space. How it is very difficult to succeed in this space. And you've done it time and time again. You spent, I think, a decade and a half or two decades prior, and I banking, I think before this, right? And then you said, for the last 27 years, is it 20-- you've been in the-- OK, awesome. You've done incredibly well in this space. So share with us some nuggets of, hey, deter people from getting at who shouldn't be. I'm kidding. Excite them too. Well, a couple of angles I can go on here, first of all, as a Duke guy, it's hard to be compared to Michael Jordan who went to UNC. But that's a separate issue. Listen, I think the thing about Venture is it's a cycle driven business. And when the cycles are up and you're good at monetizing, there's a lot of opportunities. But you got to ride out the troughs. And so we were brilliant in '19. We started in '19, '98. And in '99, we were brilliant because we had a few good early bets. Then the world thought we were idiots in 2000, 2001, 2002, when many people abandoned the consumer world. And then it came back in '06, '07, and was going pretty good until the great consumer recession came. And then many smart institutional investors told me that there would be no more consumer investing opportunities ever. And within months of that, Uber and many other great companies were created. And we invested in Zoola. And then we had a super long bull market. And then everything looked like it was up into the right in '21 and '22. And then obviously, late '22 and '23 and '24 has been tougher. So I think one of the secrets in life and in venture capital is writing out the waves. And that's why you create funds because you got lots of different bets in a fund. But I think your question was equally to some of the listeners is venture right for them. And I think it's a worthy question. It's a wonderful, wonderful, wonderful business. Most people are not successful as investing in venture capital. It's just hard. And the people who are successful are both hard, working, and lucky. And I think the key in life is figuring out what you like and what you do well. And if you can find the intersection of those two things, you're blessed. But the idea that how cool it is-- I mean, I grew up in New York. And the reason why I went to Seattle in 1998 is because there was literally no venture capital industry in New York. OK. And really, there wasn't much until the 2010s. And in the last 15 to 20 years, it's emerged. And it is currently the area where we're investing the most capital of any area, more than San Francisco, which is just fascinating. But all that said, I think the challenge that every listener has is, are they graded investing? And if they're not, there's lots of other things in and around venture, networking, and other things that you can do. But at the end of the day, I've seen many people who were great networkers try to be great investors. I've seen many people who were great operators try to be great investors. And sometimes it works. And the majority of the time, it doesn't. I love how you're sharing these nuggets. It's fantastic. In your document that you had run from the day, founder fit is greater than market size. Share with us. Devils with that. And let's play with that one for a bit. We truly believe that to be a successful early stage founder and take something from obscurity to ubiquity, you are fit with the mission, with the company is important. Because it's so frickin hard, there's so many times when you're going to hit walls, and you need resiliency and perseverance. And so we found a company in 2006 called TruePanion. At the time, it was called That Inference. And it was a medical insurance for cats and dogs business. They were outside of an island. They were outside of Vancouver, BC. And they moved down to Seattle when we funded them. And they became TruePanion, the intersection of True and Companion. And at the time, we invested in them. They had 6,000 pets under insurance. And today they have around 2 million pets under insurance. But the founder fit was the founder owned a dog that him and his family put down, because they couldn't afford the medical treatment. All he wanted to do when I met him when he was 35 was build the world's best and most successful medical insurance company for the most dog owners possible. And here it was. Here it is 26 years later after he started his business, that the businesses worth over $2 billion. And it's a category leader. But I think it was his fit with the cause that enabled them to endure. He lived the challenge, experienced it himself, was probably obsessed with it. That's what you want to founder. And we talked about this in class a lot. The founder is the idea will pivot. But you mentioned some great points. It's the characteristics that founder, if they have a great-- and they have great ability to execute in this space, that far trumps sometimes the idea and will push it. You did speak about optionality. And I muted because you can hear the annoying dog barking. Keep the dog in. We've had it before. We had a buddy from-- Yeah, get him in. Just telling you, that's why I muted, because he's barking. You mentioned optionality as one of the kind of plays in what you said, like the focus, crazy edge. Don't chase the optionality. We just jumped on kind of the energy drinks, which is the challenge, right? Everyone's trying to jump into that space. So then you said optionality. You said, don't chase these kind of things. Kind of go with conviction in a focused area that you have some extra decent. Well, I think venture is all about optionality. But I think your far less likely to be successful in areas that you don't know people in and that you haven't been involved with or that your network isn't involved with. And so if we see an opportunity, we can assess it quite quickly if they linked in profiles to the founders. We have a good feeling and connections with them. It's just familiarity versus learning something new. And just to expand on that, just for our listeners, you just nailed it. So essentially, I'm in sports and media. I get pitched. Health care. I'm not the right guy for it. Because I did, I was an IT in health care, early in my career. But I have beyond a check. I can't unlock much value for that space. But beyond my wife's connections, because she's in that space. So but that's very limited. If it's in sports and media, if it's something that can help an NFL athlete perform better on the field, I have relationships there. So that's kind of smart money versus dumb money you hear about, which is kind of think where you're going. It's stick kind of your thesis of your fund, where your expertise lies. So that's your relationship slide that you can help scale something. Because the whole thing is about backing something phenomenal and scaling the heck out of it. And then so the right folks come in and take it where they need to take it from there. Essentially, right? Are you at all-- you know, like in Dresden Horowitz, I don't know if Dresden went to my undergrad, several years before I did, but Mark in Dresden, he wants to do this thing where he lets keep things private longer instead of unleashing them and you know, IPOing them and unleashing them. And since you've taken several companies public, I want to get you taken on that. A, it probably stems from there's a lot more liquidity in the market. So they had the ability to keep things private longer. They had the capital to do it. And they wanted to capture more of that upside. Where do you think we're teeter? He mentioned this around seven, eight years ago. Where do you think we are that kind of matrix? Where are we in terms of the length company state private or do most founders want to state private? Which question are you asking? Those are both great questions. Let's go with the first one first. And then I want to take what you're seeing with your founders that you work with since your portfolio is vast. You know, I've been honored to be involved with, I don't know, taking any company. No, 20 companies public. I would say 80% of those CEOs went public because they felt they had to, not because they want to. And 20% have actually felt like the public markets brings rigor, scrutiny, and public market investors. Many, the best are very smart. So some people like taking their company public, but the majority don't. And in Maveron's portfolio, I would say, you know, Zoolily might have been four years in. And that was super fast from our funding to going private. And we have companies 15 years in that are still private. And what's happened is the vast-- many of the America's best companies are still private. And a lot of the AI, Bohemus, are still private. So the value creation in that market is unprecedented in the last five years. Therefore, the amount of capital flowing to that market is unprecedented. And you have companies raising-- Playa just raised $650 million privately, mostly for some people who get liquidity and for others to pay taxes, not because the company needed the money. So it's a whole new world. And just this week, we looked at two platforms that are trying to give the everyday investor access to a basket of those kind of companies. Are you seeing-- and then let's go back in that. You used to nail that. Before you used to have a smaller funds, they'll say 20 years ago. And then the last 10 years, this whole thing where it was easy enough to raise $1 billion funds, where that wasn't very common before. And also then to return on these $1 billion funds, is increasingly difficult. So are a lot of these companies forced to stay private longer because of that as well to capture some of that so they can return to the fund? Well, I mean, there are definitely circumstances where investors that are concerned about their distributions are selling into the private markets. But if there are tens of thousands of private companies, there's only 25 to 30 companies, where there's an active liquid market in private companies. So SpaceX being the most extreme example, private company, but very active market in trading its stock. Most of the long tail, it's hard to get liquidity. And that is a problem for one of the reasons why institutional investors are frustrated with the venture asset class is many people have buried in their portfolio, 1, 2X, 0.5 to 3X companies that they can monetize and have been sitting in there forever. One reason I like being in front of people like Alana, this younger generation, because then you can see what's coming. So I have cousins that are around your age, Alana. And one of them is kind of a mid, she's somewhat of a social media influencer, I guess. I don't ever go on her Instagram anymore, because I don't need to see her dress like that, but I'm not sure I can answer her cousin. But she's pretty girl, so she's doing her thing. And she gets sent a lot of stuff, merchandising, all that. But she's doing her thing. And then her brother is pretty deeply tapped into the tech space. I'm always asking their opinion on things, just kind of give me some where the drive, where the innovation's going, where everything. What do you see coming forth? And do you give your dad input? Like, hey, this is something I see coming, take a look. He does tend to ask sometimes if it's like a younger influencer type of a company that comes to him. Or he has a call with someone, he's like, what are your thoughts? Or he always asks, do you know them? That just happened the other day with us. Someone started working. Where did they start working then? Well, what was the company? That fashion company? And he was like, do you know it? That happened a few days ago. What do I see popping up? I mean, I want to see more media-related content. At least that's definitely not Maveron's, though, guys. Just because it's more like consumer area. But I'm definitely interested. A fool's question. A fool's question is, what kind of influences are you following? Is it the big ones? Is it the small ones? What do you-- Like-- I don't even know if that was my question. Was it? [LAUGHS] OK. No, no. I'm putting words into your mouth. No, it's perfectly fine. What do you see that's coming? I mean, I think your Maveron's focus is smart, because media and sports is incredibly difficult, because everyone wants to play here. So the ROI's are sometimes limited, because there's so much capital flooding here. It's best to go into maybe non-sexy businesses, right? So now energy's going to be a big thing. We know because of AI and all of these cool things coming. So that could be somewhat of a sexy face with incredible ROI. But what do you see coming? Just see a lot. I'm just thinking you could share this with any of the folks. OK, this is kind of a hot product, hot service, hot need for people in my generation. I mean, I think AI is exploding. I think anything AI-related is going to do well. I think in that area, like hardware, tech, enabled services, I think the wellness and beauty industry is exploding. Anything in that area, I think people-- it's like trendy to take care of yourself. So I think that space is also going to-- or it kind of already has exploded, but it's going to continue to be popular. This helped them on the space. Definitely, I'm seeing a lot of activity in it. I'm working in Pitch and we don't even-- we don't play there. There's a lot of CPG products coming for athletes in that space, right? And that's not something that we delve into. But I know a lot of athletes want to, because their bodies have been through a lot. They want to get them right again. So that's something we may tend to explore, because there's something there. Around the world, this economy relationship that we have, they're seeing a lot of women's health just in general. On who runs it, she's phenomenal. And she's trying to help the bottom billion. Her word's not mine. Meaning there's affluent people in the West and everywhere. But there's people that have less access to information. And thus, you know, like-- and don't-- so she wants to-- she's partner with Nokia to get a mobile phone into some poor woman's hands, a girl's hands, for like 10 to 12 bucks, perform a thing that can have access to the internet and provide all that for them. So she wants to get to a billion consumers. She's already signed deals to get her to 500, 600 million. And a couple of short years just globally. And it's phenomenal she's doing. So that's what I'm glad they're hearing these things from you as well, like Health and Wellness is a big thing she mentioned. And she wants us to jump into that a little bit more. She can explore that more with folks. But that's a big space. Media-- what are you thinking in media? I'm just curious. From what would you want? So the latest thing you can see is obviously-- and it's kind of-- it's growing, maturing, it's TikTok, it's obviously the social media platforms. How to monetize that's a different thing since Instagram's crushed it in that space. TikTok is, but still that scale. Instagram is doing wonderfully well. TikTok has the consumer, has the eyeballs, though. And they could do something if they could figure that out. What else would you want to see? I'm just curious. Well, I just think there's an oversaturated market of content. So some kind of system or platform that could create for you content. I know Netflix recently said they're going to create a space for that. But I'd urge all streaming platforms or production companies to kind of create a system of that sort. Because there's too much content. We just can't watch it a little. So kind of tailoring content to the viewer based on their previous viewing activity and their preferences there. I think that could be a really important service. I also heard-- I heard-- --general. What were you going to say? I was just going to say that kind of content curator using AI. There's a business called Particle. I heard all about it last week. Wait a minute, Doc. They curate your news feed using AI. And they don't just serve up articles, but they synthesize the articles. And they go get podcasts on the topics that you're interested in. And so this was a thing for news, but exactly what you're talking about a lot of. That's awesome. But that sounds like it could be dangerous almost. Because it could only give you news from your party point leaning. Absolutely. We talked about this, right? The algorithms can get dangerous because they can take you down that one and you don't get to see the other side. Yeah. And I feel like that's Instagram, honestly, and social media, at least from people, especially like young people, I'd say, people around my age, like they only get. I mean, most people now that are my age are like-- So if you're on TikTok, you can see LA is burning right now. But if you call any of your friends in LA, they're like, no, it's just two, three blocks of just weirdness. Yeah. And it was like a couple days, right? So yeah, we just-- and they're getting calls from all over the place, asking when things happen here in New York area. People ask, hey, everything OK? It was just a nice, laid-off thing, whatever it was. And it just gets blown up everywhere. So that's scary. And that's where the tech has gotten a little bit out of hand. Where else would you want to go? So if-- Dan, pull in a lot of this one. So like, OK, when you look at a pop belly, I know I'm getting a little self-assured Chicago. That's a heavy lift because it's a lot of overhead. This restaurant brand-- I got a lot of yawning, like I did in class, apparently. It's OK. All right. I'm just trying to keep you awake, kids. OK. But when you get involved with something, what do you see in something like that? Knowing that, man, this is going to be a heavy upfront expense overhead is going to be extensive right upfront. And then you have to-- it's a longer draw. What are you looking for in those kind of things? In those kind of investments? I'm not looking-- I'm not looking for pop belly today. OK. So at that-- OK. You invested in pop belly in 2000. Yeah, it was like-- fun too, I saw, right? I believe. eBay was your first fund. OK. So what made you think? That's what-- that kind of stuff is scary to me. Then you hear like Dave's chicken, who had just what they just did in like five and a half minutes, which is impressive. But what is someone looking for in that space, generally? Well, you have a bunch of companies that have today's version of that is Blank Street Coffee. I forget that burger place named in New York, but there's a very low-- Seven Street? Seven Street Burger. Thank you. These are taking consumer staples coffee burgers. They're having a very small low build out cost-- 2,3355,000. They're generating well over $1 million in sales annually. And so they're not the old model, like pop belly, it would cost $500 to $1 million to build the store. There is firms like left lane in New York have done a good job of finding these low catbacks businesses and getting super high returns on invested capital and paying off the cost of the unit in under two years. So it's a cash on cash business. It's very expensive to do pop belly. We invested a pop belly at stick stores, or maybe eight, and we exited at three or 400. But we only got like a 3 1/2 X. Interesting. Because we raised so much capital to build these stores. Right. Whereas-- And so our cash on cash payback was three to five years. So this Seven Street Burger, if they put up $250, they're trying to get $250 back in a year or a year and a half. That's a very different equation, requires less capital, less dilution. But the concept of dilution isn't typically thought through by many investors. And the AI revolution has been fascinating because many of these AI companies have been raising incredible amounts of capital. Yet at the same time, they position themselves as being freeing up capital and not requiring capital. I was looking at a business earlier today that was built bootstrap to men's clothing brand. They just went from 16 employees to 16 by turning their CX customer service almost all AI by turning their marketing image creation almost AI. So you've got these cross currents where the valuations are so high people are raising lots of capital, but they're not really spending it. A lot of we talked about this in class. Are you seeing this as well, Dan? Before we used to look at us, both coming in and to invest into these companies, OK, they're hiring more people. That means they're ready to scale and just blow this out of the water. Now we're looking at-- because of AI, we want to invest more in companies that have less employees. Before it was kind of flipped a little bit, the script has flipped a bit. You're seeing that as well? Yeah. I think that's incongruent with the big platforms who have to put large dollars to work. So it'll be interesting to see who wins the entrepreneurs or the bigger platforms. Yeah. That's the sexy thing now. A couple years back, it was crypto, a couple years before that was a SaaS. So it's the thing right now, but this is making us incredibly efficient. Let's end on a few nuggets that you'd like to share with the audience. I love for both of you to chime in. Like kind of the future of the space, where you'd like to make more impact in this space after everything you've done in it, Ilana, where you want to play, and how we can help you. I mean, go to the go-to. OK, so Ilana, then come to-- Do you want to start it up? He said to go to you, you're the go. OK. No, I said, Ilana, go to the go first, and then you can go to baby go over here if you need some backup. Yeah, he's-- That's what I'll say. So in first, yeah, yeah. I got it. I got it. Yeah. You know, listen, I think the venture capital world revolves around platformships. We were lucky to start.com. We were lucky to participate in mobile. And AI is definitely super exciting. I think watching the application layer and consumer companies integrate into our lives will be really exciting. And I'd say we're still in the top of the first inning. We're in the second inning, maybe, in the creation of these large language learning models. But we're in the top of the first inning in terms of real consumer applications. I also think longevity for a guy like me, you know, I heard I was talking to someone at Coastal of Interest today, and they told me that Beno Koso is turning 70. I think he's got 20 to 25 years left based on, you know, what the world is doing with AI and health care. So I think it is incredibly dynamic, probably the hardest time to run a business in my lifetime. Changes are radical. Consumer behavior changes are radical. But I also think change brings opportunity. And those are two areas that I think we're going to see multi-hundred billion dollar companies being created. Yeah. Yeah. The one company just-- what one founder exited to $80 million, I think, right? It was a-- it was a SaaS play, I believe. And they'd weeks acquire them for $80 million, just one gentleman. I think he had a couple of people working with him, but he had the sole ownership, which is fantastic. OK, Elana, what do you got? Or what's coming in the future? Yeah, what do you think-- Yeah, what are you excited about? What's coming? How can you help shape it? Like your dad shaped a lot of our futures. How are you going to shape it as well? I mean, I think the main thing my dad taught me was life is all about who you surround yourself with, and the relationships you make, and who's going to be on your bus in life cheering for you. So I'd say like I've done pretty well in that department so far. I think I have amazing friends that I feel very blessed to have, but continuing to build that and kind of creating more like mentorship opportunities with people, which I think comes over time with more professional experiences, which I'm only three years out of college. So I would say I haven't had as many of those just with age. And then I think the second thing that my dad instilled is you could do anything you put your mind to as long as you have intense work ethic and grit. I'd like to think I've proven that to be the case so far in certain things I've done in life, but I'd say continuing to do that and not shying away from things and just taking risks if that's where I think I need to go. Yeah, love that. And I think the last session right after you, Dan, was my, I just, I shared with them some things that I wish they, I want them to do get out there and do some things now that you won't be able to later when you have a spouse or kids or whatever. It'll be a little more difficult to find the time to do things. So just get out there and try things now. I'm completely agreement with that. I love this. This is awesome having you both on. I love for you both to come back sometime. I will love to keep going, but I know we got to get you to a dinner. So we'll do that. Thanks for the whole. Appreciate it. Thanks for giving my name. Thank you. Love the questions and love the way you're giving back to this community. Thanks for having us on. We're keeping it an honor. Appreciate it. Thank you. Thank you a lot for making this happen. Appreciate it. Yeah, thanks so much at all. We can't get a lot on to say my name right. We're going to get it. Dan got it. No, we can't. I'm going to say. It's all? No, I thought. Gotta go with the H. I thought I fell. I fell. But it's all. It's pool boy stuff. But Dan's got it. Sorry. But. [MUSIC PLAYING]