Paul Davenport:
Hello and welcome to What The Tech from Boast.AI, where we talk with some of the brilliant minds behind new and exciting tech initiatives to learn what it takes to tackle technological uncertainty and eventually change the world. Today, I am thrilled to welcome to the show Luba Lesiva, an all star in the world of startups and fundraising. She's the founder and CEO of L4C, where her focus is on helping early stage tech companies get out of the weeds of fundraising and investor management, offering a hand to help founders survive the circus of fundraising and cap table management.
Luba is also a founding partner at Palumni VC, a network of more than 900 operators, founders, and angels investing in startups founded and led by Palantir alums. They work with founders at the earliest stage of company creation, pairing them with the right support and advice for every step of the long founder's journey, with a portfolio that includes Adyton, AngelList, Kairos, Kolena, Kurtosis, Little Otter, Metaview, and Mural.
Needless to say, Luba has the skills, network, and experience it takes to navigate business challenges at all levels and is a huge asset to founders across the globe. Her Substack alone is a one-stop shop for digestible advice for founders, and I can't wait to hear her story and take on what it takes to build a business in 2023. Without further ado, welcome to the show, Luba.
Luba Lesiva:
Thank you very much. Thank you for having me on.
Paul Davenport:
I'm so pump to have you. I know that you are a member of the Boast community too. Actually, our co-founder Lloyed introduced you to me about a month or two back. I'd love to know, could you tell our audience, tell us about your background. How did you get into the startup space? How did you get into the many different financing vehicles and programs that you've been involved with so far and your genesis story?
Luba Lesiva:
Sure. Well, I ended up in tech kicking and screaming. I grew up in Sydney, Australia. I did my undergraduate degree in actuarial studies, and my father kept pushing me to go to Berkeley and do an engineering degree. And I said, "Definitely not. Definitely not." I graduated, went to work as every good statistician did in those days into investment banking. This is going to date myself, but I started my career at Merrill Lynch. For the young guns, that's part of Bank of America these days. I started covering infrastructure, utilities, and mining assets.
Very, very quickly within investment banking decided that I wanted skin in the game. I didn't want to be giving advice. I actually wanted to be putting capital behind my decisions. So I went to work in what today would probably be called growth equity. First, investing in infrastructure and mining, so the same sector that I was covering. Today, we would rebrand it as cleantech, and then I went to work for Goldman Sachs in their principal investment area.
Did that for a few years and then ended up on an extended break around the world, went traveling, stopped at every single food festival in Spain. Highly recommend. Ended up working in Ghana for a short stint in Accra, and then spent three years working for Sovereign Wealth Fund in the Middle East where I invested about 200 million venture capital funds and directly into tech startups.
I actually launched Adia's Innovation Alliance Program, which was an initiative to invest long-term patient capital against the most humanity affecting problems that needed long-term solutions, so things like cleantech, things like automated healthcare, dealing with issues around climate and around an aging workforce. After three years in the Middle East, it was sort of time to decide where to go. And I thought, well, I've now somehow ended up investing in technology, so the only place to go was to the global maxima.
I went to Silicon Valley and I ended up working at Palantir, where I headed up investor relations. I raised the Series J and the Series K rounds. And for the founders listening to this, yes, the alphabet goes that high. I raised about $1.2 billion for the company across those rounds. And as part of that, met a lot of Palantirians. I was always chatting to folks in the product team, finding what was coming down the roadmap. I was chatting to folks in our customer facing roles and seeing what customers wanted and where that theme was coming from.
I was chatting to folks in the real estate team because that's a use of investor capital, and all of these were data points that I collected, packaged up and used either as part of fundraising or giving investor updates. After I left Palantir, I had this great network of folks, for many of whom I was the only person that they knew in finance.So they'd reach out to me for advice all the time, whether that was looking at a competing job offer, sometimes looking to sell some of their equity. And by their nature, those conversations are very, very personal.
You're talking about people's career aspirations. If you're talking about selling equity, well, the next conversation is, what are you going to do with the money? Oh, you're going to buy a house? Oh, that house is not near the office. That's a sensitive topic. And so what ended up happening is a few years down the road, folks would be thinking of starting a company. And they would go to ask people for advice, but the person that they'd already asked for advice in some of the most intimate areas of their life is me.
So very quickly I would get calls of, "Hey, I'm thinking of starting a company. Let's go grab a coffee. Walk up and down University Road in Palo Alto and let's chat about whether this is a product or an actual company. Maybe it's just a feature, not even a product and it's not worth raising money for it." And so this was a nice little activity I did on the side. Maybe once or twice a week, I would walk up and down University Avenue, drink a coffee and answer people's questions from early stage founders.
During that time, I was also running L4C, which was an investor relations agency that I launched to help work with early stage and mid stage startups, to help them raise money, manage investors, optimize their board structure. Then COVID hit. No more walking up and down University Avenue and drinking coffee because the cafes were closed. No one wanted to meet in person. And so it was like, okay, well a little bit less coffee for the next couple of years. Sure, we'll make do, but the inverse happened.
So conversation that was previously occurring once or twice a week, because you had to meet someone in person and do something in person, was now happening twice a day because people who were too far away to go grab a coffee could still jump on Zoom. So I was talking to founders who were in Silicon Valley, but also founders who were elsewhere around the US or around the globe. So I went from a couple of conversations a week to a couple of conversations a day. And some of those conversations as Palantir was getting ready to go public were around liquidity.
"Hey, I'm about to come into a bit of cash. I'd never really planned on this. I'm thinking of investing some of it to diversify my family's net wealth." I was like, okay, great, so you're going to buy maybe some listed stocks, some bonds, maybe some real estate. Folks will be like, "Oh, no. The only thing I understand is early stage tech startups. I'm going to buy more tech startups." I was like, okay, that's one interpretation of diversify. What are you thinking of investing in?
And folks would invariably say, "Well, a buddy of mine, actually, we started at Palantir same day. They're starting a company. I'm thinking of investing. Wanted to get your opinion." And all of these conversations sped up and they became about both folks wanting to invest in their former co-workers and folks raising money. I was like, well, I'm in the middle of this marketplace. And as a meat robot, that's a very inefficient marketplace that I'm operating. Why don't I actually put it online and put some products behind it?
By that point in time, I'd been on AngelList maybe for three, four, five years, had done about 40 investments on the platform. And I thought, well, let's put this up on AngelList. No one else is running a Palantir alumni syndicate. We didn't have a name, we didn't have a logo, but I literally put it up as like we're a syndicate that's going to invest exclusively in Palantir alumni founders from pre-seed to pre-IPO. I had this view that it would be side gig, very much like a COVID side gig.
It was the theme of the time. And so I thought we'd maybe grow to 60 investors and maybe make two to three investments a year. It's probably 20, maybe 25 startups founded or led by Palantir alum. It's at probably good pace, two to three a year, we can always choose the very best. I was massively wrong. Turns out that there is over 200 startups founded or led by a Palantir alum, and the investor demand to invest in them is off the charts. We had our first investor, limited partner, in our syndicate within half an hour of putting up a landing page.
Remember, we had no name, no logo, just a one sentence description. We had three LPs by the end of the first day. We doubled LP count every single business day through the holidays. We'd launched at Thanksgiving 2020. By February 2021, we were top quarter syndicate on AngelList. We had 80 investors within the syndicate, and I was like, okay, it's time to make some investments.
Needless to say, this is no longer a side gig with 900 investors in the syndicate, 200 startups founded or led by a Palantir alum in our investment pipeline. We've now made 16 investments. And Palumni VC, now with the name and logo, has basically taken over my life.
Paul Davenport:
I mean, you certainly got your skin in the game. I know that was one of your early goals. It sounds like you're probably more than just one meat robot. You're probably three meat robots at once right now in terms of just how many different missions you are leading at this point. You've had your hands in so many different arenas.
I know you had mentioned too that yes, you got into the banking game in the traditional side. I'm roughly your age, so I definitely knew all the brands and all the names that you mentioned. I'd love to know, what are some of your passions based on the companies that you've worked with to date?
Luba Lesiva:
Recently, we've been spending a lot of time as a network in industries where people work with their hands. And so that can be someone who's maintaining oil and gas pipelines or cement silos, but that can also be an aged care nurse. And these are sectors that have historically been overlooked by the tech industry. These are folks that do very, very important work. They take care of some of the most sensitive members of our community. They also take care of some of the most critical infrastructure of our society, giant bridges, giant manufacturing plants.
And there is a real shortage of employees in that sector. It's not a place that people want to go work anymore, and so we have to find a way to do more with less. And part of that is being able to use technology to do the things that technology does best and leave humans to do the things that humans do best. So what do humans do? Humans can care better than any robot ever will.
Humans can show judgment better than any robot ever will. But a lot of work around data collection, around sensor, around data storage, that's better done by a machine. And that's something that we focused on a lot at Palantir, getting that human to technology symbiosis to get the best outcome with the lowest input of human labor. And so I've really been thinking about bringing that to other sectors.
Paul Davenport:
It's actually really resonating with a conversation I had with a founder yesterday who's involved in telemedicine, and they came from a very, very similar, I think, starting point as you in terms of we need to make sure that these people who are working with such critical infrastructure and who are working in such overlooked industries, I think, in some regards are getting touched in the tech revolution. It's about serving those areas where tech really hasn't shined a light on, at least in the recent past. So that is so cool.
Now, we did dive into I think at the beginning there a lot about the genesis stories of how L4C came about and how Palumni came about. But again, just to drive a bigger point too, I know that your expectations for Palumni started at maybe 20 to 25. It ballooned to maybe 200 startups that could qualify for this kind of program and investment. Could you tell me a little bit about how those goals have changed just as the realities of scale came on your radar over the course of the pandemic?
Luba Lesiva:
Sure. So initially this was, as I said, supposed to be a pandemic side gig. I thought it was something I could do for a couple of hours once a week while my toddler napped. That has not happened, so please don't come to me for advice for work-life balance. Not a forte of mine. Now that we're at over 900 limited partners or investors in our syndicate, we've made 16 investments in 13 companies. And we've discovered that there's over 200 startups founded or led by a Palantir alum.
By the way, that's a number that's growing by 25 to 35 startups, new startups that are born every single year. Where the goals have shifted and grown is around, now this takes up my entire life, is building an institutional franchise. So there's a reason that even though I'm a solo GP of the firm, my name's not on the door. We're Palumni VC. And I think very long and hard about leveraging the power of this amazing network that we have. Our LPs are predominantly operators.
They're still doing their jobs. And so anytime my founders have a question, I can give them an actual tactical actionable answer by leveraging our network, and I can do it very, very quickly. And so I think a lot about building an institutional firm where we can be the first call for Palantir founders who are raising money and do it in a way where we can lead rounds, where we can put serious capital to bear across some of the most impactful problems within our society.
Paul Davenport:
That is fantastic. Honestly, I love that you take that community led approach too. That's something that at Boast we take very close to heart. And another theme that I'm picking up on a lot of the conversations we're having with VCs and with founders, the pandemic was really a force function for people to get moving on things that they weren't maybe acting on, which I think is really interesting considering a lot of us thought that things were going to slow down in different spheres.
But I think at least in the startup space and in these community led businesses, it was a great opportunity to level the playing field. Geography played much less of a role in terms of getting you access to the resources you need, in terms of human resources, beyond just the capital of it all and beyond just the funding. It really gave people an opportunity to be like, hey, I've got this time now. I'm going to focus on my startup, or I'm going to make my dream a reality. How are you liking it?
Why this market? Why are you working with startups? And also even in the VC space. I'm personally a little averse to numbers. I love the startup stories, but I'd love to know what about helping founders get off the ground or helping make these capital connections keeps you going, especially at the pace that you're moving?
Luba Lesiva:
I think being a venture capitalist is the best job in the world. Anytime I hear VCs complain online that it's so hard or this or that aspect of the job is so hard, I'm like, no, there are much harder jobs. You can have much bigger problems in your life. Being a venture capitalist is incredible. You meet these founders who are experts in their space, who are looking to solve very large, very meaningful problems, and they're so excited about what they're building. And you get to play a tiny part in that.
Every time I talk to a founder, I come away energized. I'm like, oh my God, I want to tell everyone this is so amazing. This thing that they're building is going to be incredible. And so I love that energy and I love learning about new sectors, new problems, new just parts of the economy that you're not exposed to otherwise in a very normal desk job. And so I love the learning of it. I love the excitement of it. That's super invigorating to me. The other aspect of it is I think I play venture capital on easy mode.
My thesis is very clear. We invest exclusively in Palantir alumni founders from pre-seed to pre-IPO. Makes it very easy to decline investments. It also makes it very easy to do due diligence. Anytime that we're looking at a startup, somewhere between 60 and 90 connections in common with that founder. And our internal metric is we want to get 12 references on the founder in writing and not from their reference sheet. I don't even ask who they've put down as references. Don't care.
I go out and get 12 references in writing on each of the founders who are Palantir alums in 36 hours. That's a depth of due diligence that other VCs are not able to get because they don't have this focused thesis and they don't have this incredible network that supports them. My LPs are putting capital behind every decision that they make, so of course, they're going to give me honest references. It's their own capital at play. They too have skin in the game.
And so we get very honest references. We're able to give very honest help, and we make very honest and capital backed decisions as a network. It's a great job.
Paul Davenport:
Oh, yeah. And also, it sounds like the things that you love about the job align very closely with what I love about being a journalist in the space. Sure, I'm here for Boast, but it's really digging into those stories and getting that exposure to new markets. We were nerding out a little bit before the show about the startup case that you were at in Southern Florida yesterday too. Just learning about the different possibilities for how a business can come together and in different industries, it's so cool.
Now, going to make it a little bit selfish, talking about Boast, you know our founder, you know Lloyed Lobo, you know the Boast team too. I'd love to know, how did you meet the team here at Boast? What's been your experience working with us to date and maybe just some highlights from that relationship so far?
Luba Lesiva:
So I met Boast when I was working with a client at L4C. I was helping them raise a Series A, and we were looking at the usual questions, how much are we going to raise? What's that burn? We came across Boast and we're like, wait, there is a government program that gives you money back? Obviously startups don't tend to pay income tax for a while. They are loss makers, that's why they need to raise capital, but you're still paying payroll taxes every single time you're on payroll. And that adds up to significant money, especially given at current wage rates.
And so I dug into it and I was like, oh, I don't want to fill in all this paperwork, and the founder was certainly not going to. It seemed kind of complex. I didn't want to get it wrong. And I came across Boast and I was like, wait, Boast takes care of the entire process for you. Let me give it a try. And honestly, I was blown away by how good the process was. Anytime you interact with a tax system, I have a degree in finance and actuarial studies, but still every time I interact with a tax system, I'm like, am I doing this right?
I want to go ask an expert. It ends up being very expensive advice that you get. With Boast, I was very confident in what we were doing. It was incredibly easy. And the work that we did in order to apply for the program with Boast was also work that we could leverage elsewhere. My client and I wrote a white paper on their technical solution that we used as part of customer conversation and as part of fundraising conversations.
I think what Lloyed's built is really great in the sense that it asks startups to do the things that they're good at, talk about their product, maybe have a couple of conversations at different levels, and then Boast does the rest that startups shouldn't focus on, the paperwork, the tax compliance, the filings, translating it into government speak. And so really enjoyed the interaction and I've actually basically been recommending Boast to my clients and the founders that we work with for the last, I guess, five years.
Paul Davenport:
Oh, wow. That is music to my ears, Luba. And you're actually echoing something that I've noticed. I had mentioned earlier that I've been almost on a road show going to events across Canada and the US over the past couple months. Never have I met customers before for a company that I'm approaching on their behalf where they are excited to see me. They see Boast on my label, they perk up. Because to your point, we help them in some ways even just get that narrative nailed.
Like sure, we're working and turning it into tax speech and things that the IRS is going to evaluate objectively, but it's also so many people on our team are founders. Those people who are going to partner with you to actually get the claims in order, in almost every case, they've started their own business. They may have even worked with Boast in the past, and they know what the good story is to get that product. Even if it's just getting your pitch nailed or if it's actually getting just the narrative around your go-to-market in place, we can help you do that.
You had mentioned that for the past five years, we've been on your radar, and you've been sharing our successes with the people that you work with and the founders in your community. Similarly too, I know we point people to your Substack. We definitely love being able to talk with people and have folks like you on the show too. So that is music to my ears just hearing that Boast was so helpful from the start and that you picked up on what I think is the true value. We are your real partners.
We are founders for founders, and that is fantastic. For my final question, I realize you've gone a little long, what's your take on the current state of startups? There's a lot of headlines around funding, a lot of headlines about there just not being a lot of activity for a lot of early stage right now. Could you give me your take, whether it counters what's been in the headlines or whether it's just some advice for founders who are trying to enter in 2023 and beyond the startup ecosystem?
Luba Lesiva:
I think VCs love to pontificate from up on high. Valuations have come down, oh, it's no longer easy to raise money like it was in 2020. It's never been easy to raise money. Whether you're a fund manager raising a fund or a founder raising a round, it's always difficult to fundraise. It was easier. That doesn't mean it was easy. Have we seen a little bit of reset of valuations and the time it takes to raise a round? Yes, but that doesn't mean it was ever oh so simple.
And so what I counsel founders is to really just keep your head down. What you do has always been tough, it's gotten a little bit tougher, but we're still making investments. We've made five investments this year, and we're seeing a lot of great startups at the pre-seed and the seed stage who are getting the interest of really top tier investors because they're solving meaningful problems and they're doing it in a way where their solution is going to be very, very valuable in the long run.
Paul Davenport:
Well, Luba, I cannot thank you enough for joining us here on What The Tech.
Luba Lesiva:
Thank you so much for having me. This has been fun.