Ed Suh @edsuh Twitter profile

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Ed Suh

@edsuh

1 year

Heard a story of a cocky VC that disrespected an analyst at an endowment a long time ago. That analyst is now CIO of another large institution & blacklisted that GP, who is now struggling to raise another fund. Treat everyone with respect. You never know where they'll end up

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Ed Suh

@edsuh

6 months

There is a popular trope that venture investing is all about being contrarian. Every VC *wants* to be contrarian, but few truly are. There are longstanding structural & rational reasons why it's so hard to be. VC is an industry with immensely long feedback cycles (7+ years). But…

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Ed Suh

@edsuh

27 days

@ChrisJBakke It was literally TikTok. What could have been… they also were in the running to acquire Instagram but couldn’t outbid Facebook

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Ed Suh

@edsuh

2 months

When I first started recruiting for venture a decade ago, one firm gave me an interview question I still think deeply about: "Pick a startup you think is interesting and draft a cold email to the founder that would compel them to take a meeting with you". According to that firm…

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Ed Suh

@edsuh

4 months

VC is a mainstream industry now. No longer a cottage business of a handful of small collections of partners in Menlo Park, it is transforming in a parallel path that its cousins in private equity, hedge funds, investing banking, all went through. With that come growing pains:…

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Ed Suh

@edsuh

2 years

Founders: if you get a term sheet from a VC with an overly aggressive timeline (48 hrs or less), call their bluff. They prob won’t walk. If they do, it’s a blessing in disguise. Not a firm you would want on your cap table

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Ed Suh

@edsuh

3 months

Founders: if it’s unclear whether a VC wants to invest, they most likely don’t. It will be painfully obvious when a VC wants to invest: there’s a switch that will flip where they go from evaluate mode to sell mode

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Ed Suh

@edsuh

4 months

Venture is a crazy job in that one single great decision can make an entire career: if you meet the next Mark Zuckerberg, write him a check on the spot, and do nothing else ever again, you will still end up as one of the best VCs ever. Everything we do in between is about…

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Ed Suh

@edsuh

8 months

The great VCs I know are completely immune to deal heat. They literally don’t care who else is looking, giving term sheets, who has passed. The bad ones I know are obsessed with it

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Ed Suh

@edsuh

3 months

A monster startup most VCs probably don’t know of or overlooked: Flo. It’s a mobile app focused on women’s fertility & period tracking. Founded in Belarus. As of Dec: $192M ARR, 60 million active users, profitable. Largest health app by MAUs and downloads for the past 4 years…

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Ed Suh

@edsuh

1 year

Seed/pre-seed founders: be wary of taking tiny checks from large funds. It doesn't increase the chances of them to lead the next round (in fact it decreases it), you will get zero value add, & there's significant negative signaling risk

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Ed Suh

@edsuh

7 months

There’s a popular view that VCs are rich and lazy, earning huge guaranteed salaries & barely working. Yes, many do. But every emerging manager I know barely makes ends meet, has committed most of their net worth into their funds, & hustles like crazy. They can’t afford to fail

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Ed Suh

@edsuh

2 months

Nearly 11 years into my venture career. Don't consider myself a true veteran by any means, but have been around long enough to impart 11 nuggets of (hopeful) wisdom to those new to the industry: 1. Sourcing is the foundation of success in venture. If you aren't finding & meeting…

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Ed Suh

@edsuh

2 months

Many new venture firms follow a common path in their first several funds. In the beginning, they become friendly with more mainstream firms and beg for small allocations into their deals ($100-250k check into a $6M seed round that Megafund X leads). They build initial credibility…

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Ed Suh

@edsuh

5 months

@Austen But the real reasons are 1) naming rights (though $100M to Harvard pretty much only gets a room named, not a building) and 2) guaranteeing admission for your kids

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Ed Suh

@edsuh

28 days

As a VC, should you spend more or less time with your struggling companies? It's an age old debate. I heard an LP on a recent podcast state they wanted their GPs to only spend time with their "Tier 1 & Tier 2" companies. A founder I know well confided to me his lead VC told him…

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Ed Suh

@edsuh

15 days

@jonwu_ I don’t think people burn out from working too hard if they’re passionate about it. They burn out from doing things they don’t like with people they don’t like

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Ed Suh

@edsuh

6 years

Venture investors live for the "this is a special company" moments. I distinctly remember that moment with @monzo when we saw this chart. A company that looks like this is special.

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Ed Suh

@edsuh

3 years

I've been insanely impressed with people who have gone through @beondeck 's programs. Feels akin to the early YC cohorts, but more specialized. Special founders and companies are being born through it right now

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Ed Suh

@edsuh

1 year

There are multi-stages funds writing so many spray & pray seed checks that they literally can't keep track of their portfolio. Heard of at least one instance where a founder was re-introduced to a partner for the A who forgot they had participated in the seed🤦🏻‍♂️

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Ed Suh

@edsuh

1 year

You are a veteran consumer VC if you remember the following: Delicious, Digg, Formspring, Friendster, StumbleUpon, Meebo, hi5, Secret, Whisper, Viddy

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Ed Suh

@edsuh

8 months

Solo GP firms have historically been perceived to be riskier. But, I haven’t seen a single solo GP hit by a bus, yet have seen *many* partnerships disintegrate due to interpersonal conflicts

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Ed Suh

@edsuh

3 months

A lesson in dilution & entry prices: Below are 2 sample startups. They're made up, but loosely based on real examples & completely feasible. 1) Company A raises a seed at a $10M valuation, raises an A for 20% dilution, then never raises again, eventually exiting for $1B. Seed…

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Ed Suh

@edsuh

3 months

Most VCs: we don't like consumer. It's too hits driven and there are few great exits. Is that not true across all of venture capital??

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Ed Suh

@edsuh

4 months

A truly accurate VC Midas List would be a list of the individuals and firms that generated $1B+ of carry in a single investment. Requires a combination of high ownership and enormous outcomes. Exceedingly rare and impressive

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Ed Suh

@edsuh

11 months

Part of what makes early stage VC so difficult is even if you're non-consensus and right, your companies have to survive long enough to be proven right

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Ed Suh

@edsuh

2 months

Term sheet etiquette for VCs and founders: VCs: 1) Don’t give crazy short exploding deadlines (e.g. <48 hours). 2) If there are special deals for founders (new option grants, secondary), offer them to employees as well. 3) Aside from standard legal DD, if you have more business…

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Ed Suh

@edsuh

2 years

@MacConwell A cool idea would be to put together a shared Google doc on all the language in a VC term sheet & collective commentary on what's standard/non-standard, rationale for each, etc.

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Ed Suh

@edsuh

1 month

Many VCs pass on companies by saying they will "root from the sidelines". The thing is, fans at games pay for tickets, so even they write checks to be there...

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Ed Suh

@edsuh

5 months

Founders are often warned about VCs who aren't engaged, the ones that don't care enough. The thing is, there is such a thing as a VC who cares *too much*. The former, while not ideal, is at least value neutral. They won't harm the business. The latter is far more dangerous, and…

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Ed Suh

@edsuh

11 months

If you're an early stage VC, you have to be willing to look crazy and stupid with your investments. Every successful startup in history looked insane or trivial early on. Disruptive contrarian ideas always do

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Ed Suh

@edsuh

1 year

Some of the best deals in VC right now are seed extensions. Some companies are truly working, not yet Series A ready, but have a clear line of sight to getting there in 6-9 months

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Ed Suh

@edsuh

8 months

A senior VC of nearly 40 years, once said something to me which really stuck: “the best board members make their impact outside of the boardroom. The real conversations happen before and after the board meeting, not during”

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Ed Suh

@edsuh

11 months

Have a ton of respect for small funds that have the guts to lead & price rounds with small checks + work to build a syndicate. Truly punching above their weight class

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Ed Suh

@edsuh

4 years

@tjnahigian Also on the consumer side: Uber, IG, Facebook, YT, Twitch, TikTok, Discord, etc. All labeled as “niche” early on. There’s a school of thought that traditional TAM sizing is meaningless since disruptive companies tend to create net new markets.

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Ed Suh

@edsuh

3 months

Even the best of the best VCs lose money on the majority of their portfolio, often the vast majority. Yet so many VCs assign so much signal when a specific VC’s involved with a deal

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Ed Suh

@edsuh

9 months

For a myriad of reasons, VCs are largely evaluated on frequency & magnitude of markups. That incentivizes consensus, momentum-driven investing (see gen AI today, web3 in '21). It's a bug, not a feature, that most VCs care more abt what's popular than what's fundamentally strong

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Ed Suh

@edsuh

5 months

@maiab All the Asians know 1500 is bare minimum to have any chance of a top school if you aren’t a URM, legacy, or athlete. Even 1600s are routinely rejected

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Ed Suh

@edsuh

4 months

Emerging manager VCs: there is rarely a scenario where it makes sense to grant a GP stake to an LP. There is *never* a scenario where it makes sense to grant a management co stake.

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Ed Suh

@edsuh

22 days

Some immutable laws of consumer social: - There’s no such thing as a “people finding” or “friend finding” app. They quickly devolve into dating apps. - The trope that every generation wants a new social network is a myth. That was something unique about Facebook Blue. Every…

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Ed Suh

@edsuh

1 year

I can't name a single high performing early stage VC fund that has a fast follower strategy, trying to break into hot consensus deals. Every single top performing fund made their returns on contrarian investments, ones that others laughed at

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Ed Suh

@edsuh

9 months

The most valuable people on the cap table are very often not the ones in the boardroom. They’re the ones the founder calls before every board meeting to prep, and afterwards to debrief

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Ed Suh

@edsuh

1 year

If the Figma deal gets blocked, it could result in a multi year frozen tech M&A market. What’s the point of an acquiror even attempting a large deal of any kind?

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Ed Suh

@edsuh

2 years

Founders: I cannot emphasize this enough. When referencing VCs, talk to companies that failed, the ones that aren't prominent in their bios. Every VC treats their stars well. It's with the other ones where they show their true character

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Ed Suh

@edsuh

1 year

One of the most, if not most, important traits of successful VCs is hustle. I've become more convinced over time that hustle can't be taught. It's innate - some people just have that extra gear, the relentlessness to succeed, to always push

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Ed Suh

@edsuh

1 year

One reason why VCs have such herd mentality is the immense pressure they get from peers & LPs to back safe founders in safe sectors & co-invest with established players. It's a lonely island for VCs who are super contrarian, but of course, the contrarians end up doing the best

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Ed Suh

@edsuh

3 years

@gwilson258 @sarthakgh I don’t actually think that’s the strategy. It’s IRR-driven: invest in the top decile of software/Internet companies worldwide, which will consistently outperform a broader index. The strategy requires super high velocity (invest in literally the top 10% of all tech startups)

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Ed Suh

@edsuh

16 days

💯 One of the best AI cos I’ve seen is starting off so narrow it’s almost comical. But they are dominating that niche, which is a fast growing segment. 8 figure ARR in 3 quarters from launch and just getting started

Suhail

@Suhail

16 days

Do everything is a plan to do nothing well. There are many AI companies trying to be the everything app of AI.

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Ed Suh

@edsuh

1 year

Venture capital is perhaps the sole asset class where luck can continually mask inferior skill

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Ed Suh

@edsuh

10 months

Great consumer investors have to be incredibly thick skinned. World changing consumer cos look absolutely stupid to most VCs early on: college directory, photo filters, pinboards, disappearing photos, lip sync videos, etc. What matters is what users, not pundits, think

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Ed Suh

@edsuh

1 year

When I started in venture a decade ago, there was a sense that you learned slowly, apprenticing, taking great care to make your first investment. I saw a radical shift with new hires in the past few years, a gunslinger mentality of doing lots of deals right away

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Ed Suh

@edsuh

2 months

@nikitabier OGs remember Path having absurd usage in SE Asia

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Ed Suh

@edsuh

3 years

@sarthakgh Totally. And it’s not even an army; a very small team. They crank super hard & fast. The reality is most VCs are frankly lazy & slow. Tiger & others like it proactively research a space, form an outside-in POV, analyze quickly, and move *extremely* fast

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Ed Suh

@edsuh

1 year

There exist startups that could become decacorns but don’t have access to capital early on, so never get off the ground. The VCs who find these undiscovered gems are going to be the top funds in the next decade

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Ed Suh

@edsuh

1 year

A VC's reputation is largely built on how they treat their portfolio companies that fail, if anything because statistically, there are so many more of them

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Ed Suh

@edsuh

1 year

If you’re a founder whose investors were demanding that you develop a web3 strategy in 2021, and are now demanding you develop an AI strategy, I’m sorry to say you need better investors

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Ed Suh

@edsuh

1 year

@NWischoff All those Teslas, Maui homes, & trips to Aspen have to come from somewhere!

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Ed Suh

@edsuh

5 years

💯awesome thread, relevant for all aspiring & current VCs. Focusing on inputs vs. outputs in particular has been key for me. The world of venture is probabilistic. Spend time and focus on areas that maximize odds of success, and trust your process.

Sarah Tavel

@sarahtavel

5 years

Weekly, someone reaches out to me asking for career advice on the decision to go from being an operator to a VC. Thought I’d memorialize it here in case others are curious:

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Ed Suh

@edsuh

1 year

One dangerous form of confirmation bias for VCs is when a startup fails that we passed on. We think we made a great decision, but the thing is, most startups fail. If we pass on everything, we'll be right 90% of the time. We don't make returns from our passes

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Ed Suh

@edsuh

1 year

The best summary of Koreans I’ve seen (also applies to Korean Americans)

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Ed Suh

@edsuh

10 months

I might be in the minority, but I feel like phone calls are vastly superior to video calls. Easier on the eyes, fewer distractions, more relaxed, & enables better listening. Video is particularly awkward because you can't actually make good eye contact with webcams

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Ed Suh

@edsuh

1 year

I've noticed two extremes of emerging managers: ones who obsess about the Tier 1 funds & seek validation through co-investing, and ones who just don't care. Of course, there's a continuum. But it's interesting to see such a wide variance

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Ed Suh

@edsuh

2 years

Hedge fund types tend to do well in growth because they are stylistically similar, emphasizing diligence/depth of research on known businesses. But early stage VC is a different beast: sourcing unknown cos and finding undiscovered founders requires a very different skill set

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Ed Suh

@edsuh

1 year

The most illuminating VC references are with founders who struggled for a while before succeeding. It's telling which VCs they say were supportive & available during the dark days, vs. the ones who disappeared then magically showed up once everything got going

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Ed Suh

@edsuh

10 months

I wouldn’t bet against the emerging managers whose GP commit represents a significant chunk of their net worth (or all of it). They are truly putting their $$ where their mouth is

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Ed Suh

@edsuh

1 year

There are many people in venture who think it's entirely an access game. At growth stage, maybe it is. At early stage, it's much more of a discovery and judgement game

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Ed Suh

@edsuh

1 year

@saranormous The worst of the worst are the ones who are investing in a competitor and do it for the intel

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Ed Suh

@edsuh

3 months

A new KPI that startup founders & investors need to track: Total amount raised vs. ARR. This multiple tells you the likelihood of common shareholders (founders, employees) getting anything in an exit.

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Ed Suh

@edsuh

10 months

True unicorn startups are ones that can turbocharge their company with venture dollars, but can be profitable on a dime if need be

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Ed Suh

@edsuh

7 months

One of the biggest tensions in early stage VC is between price discipline and the power law. While entry prices matter, it’s always fine to overpay for an incredible outlier. And there’s no such thing as value investing, given the intrinsic value of most startups is 0

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Ed Suh

@edsuh

1 year

When fundraising, if you're scheduled to chat with multiple people, and only the most junior person shows up, most of the time that's a soft pass. Conversely, it's usually a good sign if a more senior person unexpectedly shows up

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Ed Suh

@edsuh

10 months

You can tell everything about a VC's character by how they react to bad news. Great VCs are unflappable - they exude calm. They boost morale. Bad VCs, on the other hand, tend to lower morale even there's good news

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Ed Suh

@edsuh

8 months

@HarryStebbings @alexisohanian @garrytan @harjtaggar Notable that those are all YC alums!

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Ed Suh

@edsuh

6 months

@tmrohan I go back & forth on this. My first job, a normal week was 8am-1am M-F, + 5-8 hours Sat/Sun each, physically in the office. It was horrible & I don't miss it one bit. The luck is more about doing something you're passionate about

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Ed Suh

@edsuh

8 months

The beauty of smaller VC funds is in their portfolio construction flexibility: there are ranges of exits, ownership targets, and diversification/concentration that can work. Mega funds only have one path: large concentrated positions in multiple decacorns

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Ed Suh

@edsuh

3 years

Just started with @Levels . Haven't been this excited about a new service in a long time. I can literally see in real time how diet & lifestyle affect my health. Simply amazing

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Ed Suh

@edsuh

6 years

👏👏 @t_blom and the @monzo team are amazing. Besides the growth, one of the best company cultures I’ve ever seen.

Monzo 🏦

@monzo

6 years

We're excited to announce that we've closed a new round of funding! 🎉

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Ed Suh

@edsuh

6 months

The cleverest reference check I've heard of: calling someone's former EA. They know more than anyone about the person's character, work ethic, how they treat people, etc.

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Ed Suh

@edsuh

1 year

There are two kinds of VC firms: ones that are partnerships, and ones that are glorified family offices

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Ed Suh

@edsuh

3 months

Dear MBAs: having a CS student build an app for you as a side project does not count as "operating experience" or being a "founder"

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Ed Suh

@edsuh

1 year

Earlier in my career, I thought the mark of a good VC was getting founders to always listen to what they say. Now I realize great VCs are ones who pick founders who are so good that they can ignore everyone's advice and still be right

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Ed Suh

@edsuh

5 months

Every investment hinges on getting 1-3 key things right. Great investors immediately hone in on those. Mediocre ones focus on 100 other generic diligence items that won't move the needle, just to "check the box"

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Ed Suh

@edsuh

7 months

Things VCs think are value add, but founders find useless & annoying: - Forwarding articles on competitors - Making product UX suggestions - Random intros they didn't ask for - Invites to conferences where the VC is on a panel

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Ed Suh

@edsuh

10 months

@mhdempsey @trevorloy As a parallel, have met with 20-something “emerging managers” trying to raise sizable funds, who claim decades of operating + investing experience, aka entry level roles at FAANG and a couple VC internships

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Ed Suh

@edsuh

2 years

@davidu Have generally found TAM projections to be useless. Most are overly optimistic bc they're incentivized to be so, but once in a while severely understate a market. Either way, not useful for an investor

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Ed Suh

@edsuh

5 months

@kirbywinfield Insane! Should not be more than ~$35k or so, assuming straightforward docs & light legal DD

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Ed Suh

@edsuh

3 years

@HarryStebbings this was perhaps my favorite episode you've ever done (and I've listened to every single one 😄). @MacConwell is incredible, and the industry needs more like him

Harry Stebbings

@HarryStebbings

3 years

I have one thing to say from today. It has been immense to see the love and respect from the ecosystem for @MacConwell . Unlike any of the 2,800 episodes we have had before and testament to Mac. Check out the discussion here!

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Ed Suh

@edsuh

1 year

The perfect startup is: growing fast, has high margins, a strong team, in a huge market, with network effects, and a low valuation. It also doesn't exist. Every early stage startup has issues. It's a VC's job to find the few that will solve those over time

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Ed Suh

@edsuh

7 years

Ecstatic to be leading a round in @monzo . @t_blom , @jonas , & @paulrippon1 are exceptional entrepreneurs. So excited to be working w/ them

TechCrunch

@TechCrunch

7 years

Challenger bank Monzo raises another £71M from Goodwater Capital, Stripe, and Michael Moritz by @sohear

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Ed Suh

@edsuh

6 years

Rarely do you see a bank with this much ambition. Here’s a glimpse of what sets @t_blom and the @monzo team apart.

Guardian Tech

@guardiantech

6 years

Is Monzo the Facebook of banking?

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Ed Suh

@edsuh

2 years

Founders: leverage all your investors, not just your lead. Some of the most impactful investors I've worked with were non-leads who weren't on the board, or angels who wrote tiny checks

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Ed Suh

@edsuh

2 months

A startup’s valuation is never a reflection of the true worth of the business. It’s merely a function of how much FOMO a single investor feels at that moment in time

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Ed Suh

@edsuh

2 years

@jefielding An even worse version of this is a large fund that strings along a founder saying they'll lead, asks for a ton of data & follow-ups, then at the last minute only wants to put in a tiny check 🤦🏻‍♂️

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Ed Suh

@edsuh

5 months

@nikillinit None of these were ever considered career track. They’re all pyramid structured - only a small % make it to the top. Medicine is perhaps the only high income career that truly is “safe”

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Ed Suh

@edsuh

1 year

Two things most surprising to me about how Gen Z views VC: 1) Sourcing is looked down on vs. diligence 2) They genuinely think making content on TikTok & YouTube is what's going to advance their VC career

'I feel like I got catfished': Young VCs who left investment banking and consulting jobs are having...

For young investment bankers that pivoted to venture capital in the boom of 2020 and 2021, the market downturn has made VC feel a lot less glamorous.

www.businessinsider.com

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Ed Suh

@edsuh

1 month

Arguably the most challenging white collar job is being a VP in investment banking. They have to be perfect at multiple tough roles at once: 1) managing up to MDs, 2) managing down to associates/analysts, and 3) managing across to clients. Have to have incredible attention to…

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Ed Suh

@edsuh

2 years

Perhaps the best life hack: Surround yourself with people who lift you up. Cut out people who keep you down

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Ed Suh

@edsuh

10 months

Venture can feel highly competitive & zero sum at times, but there is a distinctly collaborative & supportive culture amongst emerging VCs. There is a genuine pay-it-forward & share-the-wealth mindset that I don't see as much with larger VCs

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Ed Suh

@edsuh

3 months

Valuation matters in venture, obviously. Entry prices & multiples can really impact returns. That being said, it's almost always better to pay an uncomfortably high price for a 10/10 company than getting in cheap on an 8/10 company. The trick is knowing when you see a 10/10

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Ed Suh

@edsuh

7 days

@rod_mallo I have a theory that rule breaking investments tend to outperform because they're the ones where conviction had to be so strong to overcome the rules

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