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What place does VC have in your portfolio w/ Seth Levine, Partner @ Foundry Group
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Welcome to The Legacy Wealth Podcast where we help accredited business owners become educated & get access to, private investments that the wealthiest investors in the world utilize to grow their net worth. We do this by providing insight & access to successful fund managers & investors across multiple asset classes.
We are your hosts, Pascal Wagner & Mike Klein, and today we are interviewing Seth Levine, Partner @ Foundry Group and we're diving into:
- How much of your portfolio should be made up of VC funds?
- Questions to ask a VC fund manager as part of your due diligence process
- Why venture investing is a long term commitment?
With that said, let’s get to it!
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Links from this episode:
- If you're looking for highly vetted opportunities to invest in, get access to our deal database of alternative investments & join our investor club at www.getfundbase.com.
- Watch video on YouTube here: https://youtu.be/f5K5K3nEjJM
Links from our Guest
- https://twitter.com/sether
- https://www.linkedin.com/in/sethjlevine/
- www.sethlevine.com
- www.thenewbuilders.com
Time Stamp:
00:00 - Intro
00:51 - The concept of venture capital
01:30 - The importance of including private assets in a portfolio
02:27 - The importance of diversification and risk-adjusted returns
03:45 - Seth Levine explains the purpose and role of venture capital in the economy
05:00 - The significance of venture capital in the growth of companies like Google and Amazon.
06:10 - The uniqueness of Venture Capital as an asset class
09:23 - Importance of understanding fund strategies and stages in Venture Capital
10:00 - Seth Levine emphasizes the need for a long-term investment perspective in Venture Capital
12:45 - Seth Levine discusses the impact of the pandemic on venture capital
14:09 - Difference between venture capital and private equity
16:00 - The need for a meaningful amount of money
17:30 - Angel investments and the need to be comfortable with potential losses.
18:00 - The learning curve and partnership benefits in venture capital.
19:30 - The difference between managing in upmarkets and downmarkets
22:06 - Seth Levine discusses the challenges of finding good deals, evaluating teams, and market analysis as a VC.
23:44 - The role of luck in venture capital and the need for skill in evaluating investments.
25:27 - The importance of continuous learning and adapting in the VC industry
27:17 - The importance of planning for the next funding round to avoid running out of money
29:25 - The difference between discussion topics and decision topics during board meetings
31:54 - The involvement of due diligence
36:29 - The importance of being declarative in difficult decisions
38:00 - Deal flow attraction and portfolio construction strategy
41:00 - Seth's approach to managing the risk profile of investments
42:45 - The average time it takes for a venture fund to return the investment
45:35 - The role of market timing and valuation
49:05 - The team sport aspect of venture investing
49:52 - The discussion shifts to the recent crisis involving SVB (Silicon Valley bank)
51:15 - The measured response of most VCs during the SVB crisis
52:45 - The need for flexibility and reconsideration of banking agreements
54:03 - GSIBs (Globally Systemically Important Banks)
55:19 - The importance of evaluating banking relationships and risk management becomes a diligence question for LPs
56:27 - Outro
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