My firstminute | Kevin Hartz, Xoom, Eventbrite, A* Capital

What do history and tech have in common? More than you would think. 

An example is that most people are either Greek or Roman. 

Greeks are great thinkers, philosophers and architects. 🏛

Romans are road builders, executors and operators. 🔨

Finding the combination of greek and roman in one individual is very rare but not impossible. An example is Elon Musk, said Kevin Hartz, Co-Founder & Chairman at Eventbrite.

During the session from May 2020, Kevin and Spencer Crawley, Co-founder and General Partner at firstminute capital, discussed the high and low points Kevin experienced with founding and growing Eventbrite and Xoom. They also covered his transition into the world of investing, the key criteria that he looks for as part of his investment process, and the advice he is currently employing with his own team and portfolio companies. Some of Kevin's early/seed investments include: Airbnb (Seed, Series A), Uber (Series B), Pinterest (Seed, Series A), and PayPal (Seed).

Transcript

00:00:00:20 - 00:00:31:17
Speaker 1
First minute capital is $100 million seed stage fund sector agnostic and proudly backed by a number of top technology founders, including 30 unicorn founders. The My First Minute series is about learning from prior generations of successful entrepreneurs and sharing that insights and lessons with the next generation of tech founders. The series has two focuses. One, How They Got Started in their careers that first minute, if you will.

00:00:33:08 - 00:00:39:03
Speaker 1
And two, how they see the world today and what they're most excited about.

00:00:41:10 - 00:00:48:18
Speaker 1
My name is Spencer Cooney. I'm a co-founder and general partner at First Minute Capital. And today I'm speaking with Kevin Hart's.

00:00:53:20 - 00:01:15:10
Speaker 1
Kevin, I was thinking as I was doing my practice account, can't be many founders who have had your first business got sold in five months. So we'll talk about that briefly. But founders who back twice by Sequoia and both times went to IPO. That's going to be a relatively small club. Is any anyone else that comes to mind who's had double Sequoia backing and IPOs?

00:01:16:04 - 00:01:52:11
Speaker 2
You know, I can't say offhand. I always joke with Rohloff, who's led both deals that I had Stockholm Syndrome. So love to our captor. No, I kid role artists in the Sequoia team have been amazing partners and I've been extremely fortunate to have worked with them twice. We are now. We signed our term sheet for Eventbrite way back in October, November of 2009.

00:01:52:11 - 00:02:22:01
Speaker 2
So Sequoia took a chance with us coming out of one of the worst downturns and she has been just as active. We've had quite a roller coaster in the past 90 days since this COVID crisis, and he has been as active ten years later in the Sequoia team, has been as active ten years later. So I don't pay much.

00:02:22:10 - 00:02:30:08
Speaker 2
Kudos to these venture folks. I get it. But but they've been a terrific partner twice over.

00:02:30:26 - 00:02:50:29
Speaker 1
I've heard you speak publicly before that the reason you started Eventbrite was to bring people together physically and through live experiences and almost kind of not an antique gaming or computer screen thing, but bringing connection, physical connection and and experiencing things together was part of the core thesis that you and Julia had. What? What's the speed? Right. The last.

00:02:51:04 - 00:03:00:08
Speaker 1
And now, of course. What's this been like for you the last two or three months? More on a personal level, almost than than than a professional level yet.

00:03:00:15 - 00:03:32:26
Speaker 2
I think Spencer hit it on our mission has always been to bring people together in real life IRL and that was the thesis and you know the love and the passion of the business. We got it started and it's been something that you would say is on Maslow's hierarchy of needs. Quite important is is that human and belonging, that gathering together and really in the world.

00:03:32:26 - 00:04:02:09
Speaker 2
And I will say in a world where we spend more and more time isolated digitally or, you know, able to connect digitally, but I know everyone here has a bit of zoom fatigue and, you know, life events will continue. So people will continue to come together and the business, while it's gone through this black swan event, will come back and will be stronger than ever.

00:04:02:09 - 00:04:33:11
Speaker 2
So I think that all of us have really the straw to to come back and reassemble. The United States has been a little bit more ornery in getting out and about. And we hope that doesn't lead to a safety concern. We, of course, want safety, too, to predominate. But in talking to Brian Chesky and Airbnb, it's a very similar story where we just miss that human contact, but not too close of contact.

00:04:33:21 - 00:04:38:07
Speaker 1
Kevin How do you see the next two or three months? How do you see this easing of lockdown?

00:04:39:06 - 00:05:08:09
Speaker 2
Well, I you know, I am a big fan of Ben Horowitz, and hopefully many of you have read the hard things about the hard things and his harrowing experience during his startup days after after Netscape. And his book is extremely engaging. It really tells the roller coaster ride of of the ups and downs of a startup and a remarkable recovery.

00:05:08:09 - 00:05:50:23
Speaker 2
But it really is compared to what Julia, the CEO of Eventbrite and her and the executive team there, it's really like Winnie the Pooh or some children's story. Sorry, Ben, compared to what Julia and the team has been through in the last 90 days. So coming into this, we started to get the initial concern and again, rule off I remember a late February board meeting where Roloff and then another one of our board members, Jane Roloff, was warning that, you know, this COVID thing would be more impactful and it was kind of sinking in.

00:05:50:23 - 00:06:21:04
Speaker 2
As you know, a lot of you had started to have this awareness. We all had this shared experience, but roll off with his team and experience globally and in Asia, you know, saw this kind of dark cloud coming in and warned us, Jane is in the cosmetics business. And she saw and they do quite a bit of business in in Asia in China and saw her supply chain interrupted, saw the consumer demand slackened and then came May 5th.

00:06:21:24 - 00:06:51:08
Speaker 2
It was abrupt. And our ticket sales just people gathering. As we saw shelter in place, we saw a dramatic just disappearance of business. It really almost stopped overnight. And that's when the team went into immediate action. And and again, it was one of the most harrowing experiences. We did almost $5 billion in gross ticket sales last year. And many of much of that is our small businesses.

00:06:51:08 - 00:07:19:25
Speaker 2
We're not taking the Wembley's and Royal Albert Hall. We're helping entrepreneurs, really, that that can run their own business, that can host different events around food, around, you know, music and so on, come together. And all of that was thwarted right away. So it was really a three, three pronged approach of really triaging and helping our small businesses.

00:07:20:03 - 00:07:47:28
Speaker 2
Renaud As I mentioned before, this worked very hard in providing resources and seeing how we could help. We had endless customer calls on on our what we call our creator side. And then we went Julia went through a really harsh and biting restructuring where 45% of our our company was, you know, we like we people. We'd been around for for ten years and more.

00:07:48:05 - 00:08:19:19
Speaker 2
We had a seat to part to right size our business. And and and then finally that culminated with almost a quarter of $1,000,000,000 financing raise. And really there's those three elements were key to really saving this business. We, of course, are not out of the woods yet in terms of we're seeing some recovery. A lot of the you know, the hotel industry and the hospitality industry, Airbnb has seen some comeback.

00:08:20:28 - 00:08:23:04
Speaker 2
We still see a lot of suppression in the business.

00:08:23:20 - 00:08:47:14
Speaker 1
When you and Renaud and Julia and the rest of the board think about what Eventbrite might be, how it would be fundamentally different, let's say January 22 or 23 versus before this started this year. I mean, does it feel like there's an even greater sense of need and mission for that, for that core reason that you started the company?

00:08:47:14 - 00:09:03:15
Speaker 1
But also, do you see that being really fundamental shifts in how people go to go to events and and is that as that? I'm fascinated by your thoughts on the secondary consequences of what I've was with the pandemic.

00:09:04:02 - 00:09:36:02
Speaker 2
Spencer That's a great question. And in there are a number of impact points that that we've really considered here. One being, you know, simply being when when this is when the shelter in place and and when, you know, we tend to have we tend to host smaller community gatherings with a lower ticket price. We think those room or those are recovering first ahead of the large stadium and traditional ticketing and entertainment companies.

00:09:36:23 - 00:10:03:27
Speaker 2
However, there is that return to normalcy, and we don't know the timeline of that. I I'm not an epidemiologist, but what we did and I think this applies or this really does apply for all startups and is that we have a base case we have which we think is realistic but is still quite a long recovery period. We have a bull case.

00:10:03:27 - 00:10:36:07
Speaker 2
We have a case where we see a quicker recovery. And again, you know, that's that's very conservative in my eyes. And then we have, you know, kind of the bear case that really takes quite a while. It's a W recovery. And so, Julien, the team has really modeled this out. And, you know, the secured financing, the tax reduction really just ensures that even in this worst scenario that we come out the other end.

00:10:36:07 - 00:11:10:00
Speaker 2
So that's one drag against the business. The second is the social anxiety, and we've yet to determine how long that is. It will be, you know, some or it will be some percentage of the population. We we we can't say offhand. But on the other hand, we do look historically back is, you know, there are precedents to this, the 1918 Spanish flu and simply that there is this phenomenon of the roaring 20.

00:11:11:00 - 00:11:57:14
Speaker 2
And so there is this very, I would say, almost hedonistic return and certainly people wanting to gather together the arts. Jazz was born out of the twenties. And we're very optimistic that we're seeing signs that that will be the case in terms of behavior of or in terms of what we're seeing, in terms of anticipation, I'm sure all you are seeing of us ready to get back together when things are safe in the third is something that I'm personally quite concerned with, is that even though we've had these strong injections of liquidity and the federal actions in in the compliments over in the United Kingdom, in Europe, we're quite concerned about the spending habits of

00:11:57:14 - 00:12:28:06
Speaker 2
consumers and consumer discretionary spend makes up for such a strong point. So again, we've got to factor that in. If we enter into a long recession in the United States, we have, I think, close to 30 million people unemployed and a lot of that's temporary, but we don't know it's permanent. And so having gone through twice and admittedly twice and don't like to give away my age, we are also prepared for for that scenario.

00:12:28:06 - 00:12:54:22
Speaker 2
And again, the lesson for startups is I think we all hope for the best. I'm an eternal optimist and it will have a speedy recovery. But I think in the case of a startup, we always hope for hitting the very aggressive plan. But if we see things veering from that, there should always be a plan in plan B, in Plan C, and that's been a consistent message that I practiced in.

00:12:54:22 - 00:12:59:16
Speaker 2
I have spoken to our startup time involved in over the years.

00:13:00:08 - 00:13:25:01
Speaker 1
On the second point of those three drags, the social anxiety. And I really hope we do see that kind of hedonistic resurgence once this is all lifted, what's the equivalent? So for the airline industry on Thursday, David Bonderman was telling us that he's been chairman of Ryanair for 24 years and both in Continental, as you know. And he was saying, you know, the middle seats is that's just going to have to be a non it's going to be free for a certain period for seven airlines.

00:13:25:01 - 00:13:46:27
Speaker 1
That was at least his view. What's the equivalent of four events? How do events look? Different are many different types. And you spoke to many of your events around for smaller entrepreneurs, it's not just the big ones, but how how do you see some of those? How does our life how do our lives look differently in some of those public forums?

00:13:47:08 - 00:13:49:00
Speaker 2
Well, I think there's a lot of.

00:13:50:03 - 00:13:50:14
Speaker 1
Times.

00:13:50:27 - 00:14:20:07
Speaker 2
I think the sports teams, the vertically entertained, vertically integrated and her team and companies have a direct responsibility. We have a direct responsibility. But in those large stadiums, you know, we know that it was the Bergamo soccer match that really touched things off where you had side by side large crowds. There needs just to be very careful actions that are taken.

00:14:20:07 - 00:14:51:09
Speaker 2
And those you know, I have a lot of faith that kind of the humanity will will win over the capitalists intention, because even even then, I think that if we come back too soon, that's that's going to be damaging. In the case of Eventbrite, we really serve the local community, nonprofits, the small businesses, the classes, all these areas where social distancing is, they are going to be much easier to implement.

00:14:51:25 - 00:15:07:12
Speaker 2
We give guidelines, we give practices, we talk about this quite a bit, but at the end of the day, we have a high degree of trust in how our creators will ensure safety in these cases.

00:15:08:01 - 00:15:18:12
Speaker 1
When when do you think do you imagine full stadiums or full theaters or when is that going to be something next summer? Is it going to be? What's what's what's your base case?

00:15:19:13 - 00:15:53:06
Speaker 2
Well, again, the lesson for for founders is that we can't predict that. And and so you really prepare for the worst whenever, you know, we hear these letters of the alphabet, whether it's a V-shaped, a U-shaped, a W-shaped or hopefully not an L-shaped. But the responsibility of, you know, founders of the executive team is and and they've really come together tightly at Eventbrite to really drive forward how we see these opportunities.

00:15:53:28 - 00:16:06:06
Speaker 2
One of the bright spots has been are the the ingenuity of their creators. And then a lot of the brilliance of Renaud, the Sage, our third co-founder, who quite a packed.

00:16:06:27 - 00:16:11:14
Speaker 1
Knows line on day one. I think so. I think Renault is with us at the moment right now.

00:16:12:23 - 00:16:44:06
Speaker 2
So Renault had the foresight to see that one of our most popular geographies addresses was online. And it's been out me for four years and so Renault began our before the COVID practice with a really startup, scrappy team of engineers and built phenomenal online experience. And as COVID struck, we just saw a very, very pronounced spike in this.

00:16:44:06 - 00:17:19:07
Speaker 2
And this has been quite exciting to see our creators in their ingenuity in terms of say, we have a I believe it's a Brooklyn based company that gives cheese tasting. And all of a sudden they saw that they could have a much broader reach. And so they mail out cheeses in advance to customers who've signed up and and paid on Eventbrite and then are able to really go through the experience via Zoom integration and others.

00:17:19:27 - 00:17:53:14
Speaker 2
And then a second example is Day Breaker where at dawn it's it's a combination between dance and physical fitness and which was a actually constrained geographically. Now it's become a global or global phenomenon with former, you know, sign ups and registrants than before. So that ingenuity in that using that Eventbrite kind of CRM analytics all that very much applies online as it does offering perhaps.

00:17:53:15 - 00:18:07:09
Speaker 1
Very last question on on November is it do you look with this would be easier or harder if you are a private company does this being a public company bring its own challenges in this kind of period? Would Julian.

00:18:07:09 - 00:18:09:23
Speaker 2
The team in real and so.

00:18:10:08 - 00:18:10:24
Speaker 1
We.

00:18:11:02 - 00:18:43:15
Speaker 2
Really like to kind of fight in to build in the light and there's concern with you know there's a lot of positives to same private but as a public company you you you really one it's it's almost a kind of Wikipedia experience where you hear and you get to hear from great investors, other founders that are looking at your business and you get this tremendously terrific feedback and you have true accountability.

00:18:43:28 - 00:19:17:20
Speaker 2
There's always that concern and that must be addressed of not thinking short term and trying to bridge earnings each quarter. And so on. But the second piece is it's you're out in the light. And so we had just a lot of great contrarian thinkers come to us. I think while a lot of people ran towards the very conventional areas and you know, Eric and Zoom is is a phenomenally talented person and has seen a big burst and investors have rewarded that.

00:19:18:13 - 00:19:49:27
Speaker 2
I see a lot of great investors with the foresight that this market will return. This is just a temporary stoppage, just as we saw in in 2001. In 2009. Pete Flint in really came out of 2009 in a housing. You know, home sales business much stronger and flipped because of its efficiency and greatness. And these are the type of patterns you want to look for in your own startups.

00:19:49:27 - 00:20:10:17
Speaker 2
So coming out stronger, we raised nearly a quarter million, a quarter billion dollars from Francisco Partners in in its it's mostly a debt instrument but they're great partners and they understand, you know, really this this great opportunity ahead of them.

00:20:10:24 - 00:20:28:15
Speaker 1
I loved that you were both a history major and that you did a year at Oxford. How did how did that happen? I my undergraduate was the same. So I was curious is curious how your year at Oxford. I think it was University College. How did that come about?

00:20:29:14 - 00:21:12:11
Speaker 2
Right. I was at Eunice and I think I had or it had always had a collector, eclectic interest in different areas, the sciences, history and following university. I felt like I was somewhat of a jack of all trades, master of none and in one to focus a bit in study George the third, which is a natural precursor for technology and and you know, and I could but you know, in that sense I would say what's really applicable is, you know, just a high degree of intellectual curiosity.

00:21:13:13 - 00:21:56:00
Speaker 2
And there's really no other place in an industry like that, like technology. Again, I think entrepreneurship is all about learning about being around brilliant people, and that's where it applies. Your history is very interesting because we repeat ourselves in technology on a much more compressed timeframe where the 2000 and we spend some time talking to a brilliant operator who was the CFO of Booking.com through the worst of the worst of the dot com crash and then being struck again with 2001 and going through that period of negative revenue from more refunds than an income.

00:21:56:09 - 00:22:22:07
Speaker 2
And he was very inspiration to Julie and the team in terms of talking through this. So looking back, historically, studying these models is absolutely phenomenal precursor. These the the tech industry is like a rapidly swinging pendulum from boom to bust. And so understanding, you know, the great periods and but also the hardships is is quite important.

00:22:22:08 - 00:22:40:13
Speaker 1
I've heard you also be critical of some elements of the venture capital industry in terms of, you know, I've heard you hark back to some of the finances. You came to me from the East Coast and invested in the semiconductor industry and that and some of the kind of you speaking the admiration of some of the early pioneers.

00:22:41:13 - 00:23:10:18
Speaker 1
But but but perhaps just before that, just two points that you touched on. I wanted to ask you a little more about one about Stanford and one about your humanities background with being a history major. Were you how did that shape your thinking to who was a complementary co-founder for you? So obviously Braverman was was your CTO and co-founder Zu and then Renaud, who we have is as CTO at Eventbrite.

00:23:10:18 - 00:23:20:06
Speaker 1
How did how how did they if I, if I can say this, a non-technical background, how did that make you think what the right pairing was for you when you were creating new businesses?

00:23:21:18 - 00:23:54:04
Speaker 2
Well, I always had a certain degree of maybe inferiority complex of being around all these brilliant engineers. My first job was it was as a product manager around a very engineering centric business. So I learned Unix says it as quickly as I could, but also had the experience of being around engineers, working on the product side and forging those relationships and partnerships and providing that complementary aspect.

00:23:54:04 - 00:24:26:04
Speaker 2
So I think the push and pull of a lot of the best, most brilliant companies is that complimentary aspect among founders, among the company. And I think there's no better reflection of that than, say, Eventbrite or, you know, the relationship and camaraderie I had with Allen and had met him at this technology company, Silicon Graphics, that extended into founding Zoom, the remittance business in 2001.

00:24:26:11 - 00:24:27:29
Speaker 1
That was Jim Clarke's business, right?

00:24:27:29 - 00:25:00:11
Speaker 2
That was Jim Clarke's business. It went through its own again, the historical manner in me saw it going through very tough times where it was actually disrupted by the PC platform. It was they were very high end graphics, workstations, and and it was just really hammered by the growth of what was referred to in the nineties as the wind chill in 2000 since the Wintel Windows and Intel dominance.

00:25:01:04 - 00:25:04:20
Speaker 1
And Jim then went to board on Andriessen as a co-founder. And.

00:25:04:24 - 00:25:41:28
Speaker 2
That's right. That's right. And again, you know, you kind of see these talent pools. They come together and then kind of explode out into the community, which is another pattern I've noticed quite a bit. Obviously, I had a I saw that with PayPal. I had reconnected with Peter Thiel. And I always point out at this point I knew Peter from university as the chair of Stanford Democrats and he obviously on the more conservative ties side.

00:25:41:28 - 00:26:10:23
Speaker 2
But we always enjoyed great discourse and found him to be a brilliant person, which is too bad in this period of polarization of of conservative ism and in liberal wisdom was balanced of of Reid Hoffman, of Peter Thiel, David Sacks, who will be on this show soon of really rule of both all with real life had an actuary background Elon Musk from the.

00:26:11:03 - 00:26:11:19
Speaker 1
Same group.

00:26:12:24 - 00:26:46:07
Speaker 2
All part of PayPal and really this cosmic what would you say big bang of talent after the quick acquisition by eBay in the mall kind of spreading out Jeremy Stoppelman with Yelp of course, all kind of exploding out and we saw Space X and Tesla, we saw LinkedIn, we saw Yelp, we saw on Eventbrite as my experience in the front row and sorry for my colleague Charlie who is barking in the background.

00:26:47:10 - 00:27:09:03
Speaker 1
I think he's just agreeing with you about the caliber of our friends. But the the what I've also what actually leads powerfully on coming to a question I was really looking forward to ask you, which is given how you sold your business to PayPal, you know, all of David and Max and Peter and Ilan and read past me.

00:27:09:03 - 00:27:15:10
Speaker 1
Well and he kids were boy and he mentioned because he was at Stanford with you as well. Right.

00:27:16:01 - 00:27:44:05
Speaker 2
Yeah. Keith was a big player. And I apologize if I left anyone out, but the talent of the PayPal mafia is is so phenomenal and broad reaching that I can't help it. Leaving some of these folks on Javad and Steve Chen coming out and creating YouTube is as well. It's just an amazing pedigree. And we could talk at length about how that has happened.

00:27:44:12 - 00:28:01:05
Speaker 2
I would call this the now growing straight mafia is another example of that, where John and Patrick Collison fostered great talent that we now see starting to come out while still building a brilliant company for the long term.

00:28:01:24 - 00:28:27:03
Speaker 1
Well, with Let's Jump Into the Valley World and I know that you tend to prefer spending more time with fewer founders and that you're not necessarily a big sector thesis investor. You believe in people creating new segments and new sectors and and have a kind of a slight hesitation around that saying I find or are or specific specific sector focused fund.

00:28:27:03 - 00:29:06:22
Speaker 1
But but just one question on how deal flow works in the top echelons of the valley. When is it when when someone when there is a superstar leaving wherever it might be, whether it's strike or whether it's opened or whether it's one of the. How does is it I'm just curious, given how interconnected it is, how does how does both spread that there's someone brilliant and they're starting a web and you've got to meet him or her is I'm sure there's no magic to it, but I'm just fascinated how how the how the sparks fly.

00:29:07:27 - 00:29:39:03
Speaker 2
Well, the the kind of spoken notes had been quite simple, you know, a decade ago. And it has now grown into quite a bit of complexity. There's quite a bit of terrific seed funds out there that in Angels out there as well that work with these, you know, the see these founders. I think in any case, you know, founders out there listening right now, there's always this concern of of how do I reach these people?

00:29:39:03 - 00:30:16:12
Speaker 2
But really, funding should should one be an adjective progress to the business. I think we put the chicken before the egg or the egg before the chicken. And it really focus on on financing. And I find that kind of the wrong path. I spoke to a company yesterday that had raised very little money. And that that company, you know, I was speaking to them about, you know, and they were considering it around and against my own best interest.

00:30:16:12 - 00:30:29:16
Speaker 2
I tried to talk them out of that and actually just continue to build a brilliant product. And so so it's really building a brilliant product, focusing on the business and and the money does all.

00:30:29:16 - 00:30:41:29
Speaker 1
And for the many founders listing on that particular space is that you're looking for products or solutions in that particular areas. You're super excited with your angel hat on.

00:30:42:29 - 00:31:17:10
Speaker 2
Well, there's a dichotomy, Spencer, there on on the one hand, I really focus on talent and you know, some of the mistakes I've been with is to overly focus on a segment or something that I want in the world. So the biggest surprises really, you know, when focusing on talent, great, great things happen. And a, you know, whether that's an Airbnb or Pinterest or so on is is focusing on a founder and seeing new categories exist that one could not even have imagined there are.

00:31:17:10 - 00:31:42:22
Speaker 2
And now the second part of it, there are emerging platforms. So we saw EOS burst on the scene in 2007 and you saw the hubris and Instagrams and so on form for that. So you can look in it's a great direction is to look how the world is changing and what new platforms or are emerging. And you know, that also attracts talent.

00:31:43:10 - 00:32:04:05
Speaker 2
And then you see new great businesses emerge from that. So computer vision, while I don't seek out companies in that space, it is an absolutely emerging platform with autonomous driving, with security, with so many different verticals coming into focus with.

00:32:04:05 - 00:32:18:22
Speaker 1
So maybe then on the, on the talent front, grit, intellect, vision, what, what is there a non obvious trait that you really look for in early stage founders?

00:32:20:20 - 00:32:52:14
Speaker 2
Well I, I really like to understand the founders background. It's, it's always been, you know, something that's that's intriguing to me is what makes a great founder. The founder I take Max Levchin as is an example of somebody that left the Ukraine, I believe it was during Chernobyl and really just left with the shirt on his back. His parents had had some foresight or had some insights that leaving that area was of great importance and getting out quickly.

00:32:52:14 - 00:33:24:12
Speaker 2
So he came to he moved to the Chicago area and became dumpster diving for computer parts, as they say, and building his own computers and then programing. And so it's a combination of that hustle and grit, overcoming obstacles and then also having absolutely brilliant parents. I believe his mom is scientist and father was a musician. And so those those sorts of backgrounds are intriguing to me.

00:33:24:18 - 00:33:42:06
Speaker 2
I find myself falling out of my convention as a middle class person from a fairly comfortable background. I would say I'm an exception. And again, have some type of check chip on my shoulder about that.

00:33:42:18 - 00:34:10:13
Speaker 1
Clearly you have a ability to identify really talented entrepreneurs. How how do you try to go about understanding them? So their background, I hear you loud and clear and and something you know, whether it's kind of a cerebral family background, something unusual, a chip on your shoulder, an edge, I think that is fascinating. But how do you try to break through that?

00:34:10:13 - 00:34:28:01
Speaker 1
Just one in one sitting, having a coffee somewhere or hearing a pitch or how did you really dig deep to understand founders when you maybe don't have the benefit of knowing that? I don't know. Reid Hoffman said they were superstar at LinkedIn. Like what? What's that? What's the process looked like of you getting to know a founder.

00:34:29:06 - 00:34:56:20
Speaker 2
Well, I, I loved working with first time founders. I, I think that, you know, a lot of the more veteran founders can see right through me, right? The first time founder is of great interest. It's it's kind of like there's this strange fascination with following celebrity or great musicians or artists. My passion is seen, you know, what's that formula?

00:34:56:21 - 00:35:27:25
Speaker 2
That's that's going to make that breakout band or where that great artist comes from. And it's very much the same for me. And in tech it's it's trying to pattern match in in determining who that is and Marc Andreessen it said something very intelligence intelligently is kind of classifying you know there's a Greek and Spencer we talked about this the other day the Greek in the Roman the Greek is the great philosopher and thinker and architect.

00:35:28:15 - 00:36:02:06
Speaker 2
The Roman is the road builder, the execute or the operator. And finding that combination, you know, it's very rare. And in in one person, you know, you would say an Elon Musk, which certainly fall in that category is thinker, dreamer, but also doer as an example of that that usually you know people fall in both I fine in in then you look for complementary teams that cover that or you find those three or individuals that do it both.

00:36:02:27 - 00:36:06:24
Speaker 2
And so that's you know, that's just one factor in that equation.

00:36:07:09 - 00:36:35:23
Speaker 1
Once you identify that talent within that group. So. ROMANS And you think of businesses and that would be many founders on the line a later stage founders the whole concept of split scaling and that obviously we'd often spoken a lot about and kind of goes a little bit in and out of favor, I think both in the Valley, but more broadly, where are you on the growth at all costs versus capital efficiency argument in general?

00:36:35:23 - 00:36:37:21
Speaker 1
But really at the moment, particularly.

00:36:38:27 - 00:37:03:09
Speaker 2
Reed's a brilliant operator, is a brilliant thinker and is, you know, brilliant investor. I have a different philosophy. I like to see companies nurture over time. I like to see them take it's been my experience to be able to spend a lot of time with a very scarce resources. So I think ingenuity comes from scarce resources. Eventbrite is going through that now.

00:37:04:04 - 00:37:34:29
Speaker 2
There's quite a bit of scarcity and just brilliant innovation company coming from the team right now in at the founders stage, a lot of the businesses and most of the businesses that invested in at the early stage have had this sense of scale, their city, its capital, while a brilliant thing to grow a business, can also be a dangerous game where too much capital breeds maybe not the best amount of focus.

00:37:36:06 - 00:38:25:16
Speaker 2
It maybe doesn't drive as much of a missionary focused team member versus the mercenary that gets the big salaries and so on. But most important, importantly is just oftentimes phenomena in the world take a while to hit a very steep S-curve and building and building and getting that product market fit is is quite important. You see that today with with companies like a figma or super human or a notion these companies were overnight successes that were years and years in the making with scarcity and a focus on product and in building rather than endless fundraising.

00:38:26:05 - 00:38:31:05
Speaker 1
I'm going to sneak in a final one, but I won't ask you to elaborate on what was your biggest misstep as an angel?

00:38:31:14 - 00:39:08:01
Speaker 2
Oh, it's it's an extremely long, long list. I wouldn't know where to start but was one I YouTube. I spent a lot of time with the team early on and kind of felt sorry for them. It was back when it was Zimmer. I didn't want to, you know, I ended up being involved number in in the series B round but you know the kind of list of seen all these great companies early on but it's important not to kind of look back but really to look forward because otherwise you could torture yourself.

00:39:08:09 - 00:39:35:27
Speaker 2
I think the other side that's important for founders is really staying engaged, and I'm not seen as much that applies on the investing side, but also it applies on the founders side. I would say my biggest challenges have been maybe non non driving through and just having a faith. This is very much with the team that Eventbrite is going through now.

00:39:35:27 - 00:39:58:16
Speaker 2
It's not there. There's still ways to make this one of the greatest comebacks in business history, but it's on its way and it's from really hunkering down and building. And I see this in startups every day. You know, there's always some sense of concern or this is taking longer than I think and really sticking with it is great.

00:39:58:16 - 00:40:31:01
Speaker 2
It's I'm so happy that Xoom, the remittance business is a part of PayPal and it's really thrived and we've really transformed it really transformed landscape for these immigrants sending money back to their families. But to see a wonderful company like TransferWise it's really stayed independent and just do such great things is is inspirational but also shows a lot of these tech businesses were just getting started when we thought they've kind of hit a wall.

00:40:31:01 - 00:41:14:22
Speaker 1
And now turning over to Q&A, just Robert, thank you for joining us and over over to you. Just wearing the two hats that I do. One historic royal palaces, which is the Tower of London, Kensington Hampton Court Palace, which, by the way, is George, the firm's favorite palace, which you must come and see. So the some of the biggest visitor attractions in the UK that went from revenue of about 100 million to 0 in a day with the cost base, of course, employee costs of about 50 zero income.

00:41:15:11 - 00:42:07:11
Speaker 1
Just imagine for a moment that you're running the Tower of London, which gets three and a half million visitors a year, 65% of foreign. They're not coming back anytime soon. Just let your imagination run right with the Tower of London and how you would repurpose it. That's point one. The second is my entrepreneurs. It's an astonishing it is astonishing what a small world it is, literally, as we were speaking of what's happening in and he was emailing Remo as we spoke, who's coming to speak at his conference next week on the virtual landscape for events because he founded the biggest event hire business in the UK and said My question there is I am looking

00:42:07:11 - 00:42:30:14
Speaker 1
at my app for Eventbrite at the moment. I have 20 tickets on it right now which I can tell you a week, but ten weeks ago I wouldn't have. But I'm doing a lot of events with Intelligence Square and various other organizations. I'm doing a dinner and a concert with the London Philharmonic on Monday. I wouldn't have done that.

00:42:31:05 - 00:43:04:20
Speaker 1
Hum, I can't believe that human behavior isn't going to change quite a lot even when we're back into full swing. What do you see as the changes that will have accelerated through this process? I know you've talked a bit about that, but I'd love you to love to hear what you really think is going to happen in this space and how human beings come together to either exchange ideas or meet each other.

00:43:05:11 - 00:43:16:09
Speaker 1
So you've got you've got the mission for the Tower of London, three and a half visitors, three and a half million visitors a year to zero. Right. And then the business. So nothing, nothing much.

00:43:17:19 - 00:43:46:06
Speaker 2
Well, those are great questions, first off and always excited to see the heavy users of the Eventbrite app. Thank you again Renaud for all your stewardship and in building a great product, the tower of London, I think just like the bear, I always think, sorry, I won't I will stop saying the valley because we've seen this democratized nation of entrepreneurship all around the world in technology.

00:43:46:13 - 00:44:33:24
Speaker 2
But just as there is kind of this CRISPR notion of kind of borrowing DNA and seeing, you know, different phenomenon out there, I think that I was just speaking with a board member of the museum and in Los Angeles, and they've gone through the same thing. And it's really the exchange of ideas among the peers that how do you drive more digital experiences or how do you kind of weather this storm or how will it change the the best manner I've seen, and perhaps you have as well, is really exchanging ideas and seeing where those bright spots are out in the world.

00:44:35:01 - 00:45:21:17
Speaker 2
With technology, you see this rapid adoption, you see some unique innovation on the technology side and in that is shared and and, you know, it's just like in in Kobe, this has been the perhaps and arguably the biggest experience of people coming together to saw in the world, in the world's history of solving a challenge. And similarly with great institutions and historical landmarks and in museums, I hope there's far more collaboration and an exchange of ideas of how to work over this in terms of the landscape of recovery, again, the near term of the economic suppression, the near term of shelter in place and so on.

00:45:21:17 - 00:45:53:02
Speaker 2
But it's there's long term effects that, again, I can't predict. I you know, I see much more local community, you know, in smaller gatherings this is a likely outcome. I still have a notion as we've gone through history that that we've seen these recoveries and that there is this, you know, common or inherent notion for people to gather in one, it's safe.

00:45:53:02 - 00:46:32:13
Speaker 2
I'm very confident that will happen. But you've seen the future accelerate, and that's exciting for a lot of our my colleagues in technology, whether it's the Purva at Instacart that saw, you know, the inevitable happening in the grocery store. And, for example, grocery delivery should happen. And now it's been vaulted rapidly into the future or in fact, the kind of communication here where perhaps we won't get on an airplane and take a costly trip around and have a business meeting for a day and a half in return.

00:46:32:13 - 00:46:57:28
Speaker 2
So I think a lot of things will change from this notion of technology being accelerated in the future and against, you know what I thought happen after this March 5th or after this, the COVID crisis began. There's been a kind of flight to technology for the first time as a means to rebuild society. That sounds self-serving, but I was quite wrong.

00:46:58:07 - 00:47:05:01
Speaker 2
I thought that I spend in a lot of these areas would be hit and instead we saw a rapid acceleration.

00:47:06:00 - 00:47:31:22
Speaker 1
Yeah. I mean, I think the most exciting thing is what a number of these institutions are going to do to the iPad. The reason that I got involved with historic policies was the digital opportunity to take these extraordinary things to the world. And I'm sure that's going to be accelerated. The it's a lot easier, though, to take it take it at the door of the Tower of London and to to monetize the the experience.

00:47:31:22 - 00:47:32:20
Speaker 1
But that's another issue.

00:47:33:17 - 00:48:08:18
Speaker 2
No, I think that you just made a phenomenal point that the Tower of London was out of reach for most of the world. And now there's a there's the opportunity to reach a much more global audience. I'm on the board of the California Academy of Sciences that had released some products in the past. For example, with the science and and Environmental Focus, I released an app called Seek Uses Computer Vision to determine the species of an insect or plant or so on.

00:48:08:27 - 00:48:15:09
Speaker 2
And that has extended the reach of the business all around the world. And these types of innovations are exciting to me.

00:48:15:28 - 00:48:37:20
Speaker 1
Eagle Coming to you has got a great question about Fortnite that I think you will enjoy. Thank you, Kevin. I have a question, I guess, about future consumption of live events. We obviously saw a recent success with Travis Scott in Fortnite collaboration, and it seems like this is the way Gen Z will be. You know, we'll be hoping to consume the life events in the future.

00:48:37:26 - 00:48:53:26
Speaker 1
Do you see this? This is the like the next generation will actually be consuming things rather than going to a physical location. Or do you think, you know, next generation will still be going to stadiums or constant calls to to see their favorite artists perform?

00:48:54:10 - 00:49:13:22
Speaker 2
Certainly, you know, back to the Fortnite example, there'll be a combo of both. But we've seen throughout history people coming together in real life together, there's nothing else like it that will will want to be with others. And there's something that can't be created digitally here.

00:49:14:00 - 00:49:33:27
Speaker 1
But tell me, sold this business to Microsoft two years ago and just as an investment, imagine last minute. My question is, with your investor hat on, do you think that the world of secondaries for start ups, both understated in late stage, is going to become less opaque, more liquid in the future? Do you see that happening through funds entering this space?

00:49:33:28 - 00:49:39:24
Speaker 1
Take no from brokers. Do you see it as a big platform play that people have tried? You're really interested to see what you think about the world of secondary.

00:49:40:02 - 00:50:13:29
Speaker 2
I, I find it it's very unrelated to Eventbrite. We serve the creators and we serve small businesses that tend not to be involved in the secondary market. I think there's a lot of innovation that needs to happen there. It really is in an area that hasn't undergone a lot of innovation. It was really an offline, you know, some consumer to consumer, but a lot of brokers involved and in a lot of abuses and opaqueness that we've seen in it.

00:50:13:29 - 00:50:46:11
Speaker 2
And and so there is a reform that's due in that area. We hope to see a lot of innovation would call to those out there because we don't want to see the market consolidated. We don't want to see it that there is this kind of consumer. You, you know, unfair consumer practices. The best Internet businesses, the best businesses out there provide a great offering for consumers and for the merchants and others themselves.

00:50:46:11 - 00:50:48:13
Speaker 2
So I think over time, you'll you'll see that.

00:50:49:02 - 00:51:14:16
Speaker 1
Pepper is a great friend, is a partner at Sweet Capital, which is the family office of the King. Guys who of Candy Crush and he sold to Activision. Hey Kevin, thanks so much for such a great talk. So I guess just just really quickly, one of the things you've touched on is the democratization of of tech and venture and I guess the kind of founder ecosystem outside of the valley is, as you're calling it.

00:51:14:16 - 00:51:46:01
Speaker 1
You know, which of those hubs are you you interested in, in particular, either through your investment so far or areas that you believe both perhaps in Europe or other parts the U.S., we are seeing a lot of a lot of talent. One area that we're focusing a lot of time on is Southern California and Los Angeles, where I think we're seeing a really interesting combination of this heritage of media and entertainment, but combined with some exciting engineering talent that's obviously been been moving down south from the valley over the last few years.

00:51:46:01 - 00:51:52:26
Speaker 1
So just curious, since you often see things ahead of others, which hubs you're most excited about at the moment?

00:51:52:26 - 00:52:23:03
Speaker 2
There are hubs and certainly, you know, London is is emerging as one. And there's a kind of self, selfish self interest of investors and founders to be in these these kind of growing areas because of the competitive nature of the valley, the expense of the valley, the growth of the of salaries, and to be able to find talent where cost of living is, is more effective.

00:52:23:06 - 00:52:57:27
Speaker 2
You you'll really see that in Asia, it tends to be around great universities, Imperial College, Cambridge, Oxford. I'll mention Cambridge this time, but so so you tend to see it around universities, but it's the gold. It's an especially as we move more digitally is is that it doesn't have to be tied in and you see so many great innovative companies come out of Europe, Sweden, with with Spotify, all the great companies that have come out of London.

00:52:58:04 - 00:53:28:22
Speaker 2
And in the trend that we see here is is a movement. Los Angeles has been a very great emergence space. We're starting to see this all around the country, in the United States, Detroit. We have a large office in Nashville, Tennessee, and some great universities there, Vanderbilt. So on that, it's really I think the university is a theater for this and the great universities, but also great talent.

00:53:29:11 - 00:53:43:02
Speaker 2
Why, you know, restrict yourself to a certain type geography when in fact, you know, there's 7 billion people worldwide and brilliance and intellect and innovation happens will happen more and more everywhere.

00:53:43:28 - 00:53:53:19
Speaker 1
Thank you so much. Really, really grateful to you for your time, but also your thoughts on the future as well as your reflections of some of your family's stories. So thank you very much.

00:53:54:13 - 00:54:02:00
Speaker 2
My pleasure. Thank you. It's been a great interaction and and I really enjoyed it.