VC 2: How Cassie Young Picks Winners Before They Even Leave Their Jobs

Episode Transcript
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Cassie Young (00:00):
This was kind of an accident for me.
I didn't have a long-term careerambition of being in venture
capital.
We joke that we have an allergyto the word platform around
primary.
We are really looking forsomeone who has an earned secret
or some type of market edge.
Buying software sucks.
Being sold to sucks.

(00:20):
Speed is a really freakingimportant competitive advantage.

Max Altschuler (00:35):
Welcome to our very special VC series on the
GTM Now podcast.
I'm here with my partner PaulIrving from the GTM Fund.
And we had a very special gueston podcast today, Cassie Young
for Primary Venture Partners.
Very fun podcast as she comeswith this unique go-to-market

(00:58):
lens.
She's been an operator in thepast and now she's an investor.
Not an operating partner, butinvestor.
Which, you know, the typicalpath, right?
CRO, operating partner,whatever.
She went a different way.
Very unique lens, interestingconversation.
You know, we'll talk a lot aboutit, but I think uh one of the
things that she said on theshow, which coincides with an

(01:19):
interesting time in, was um ifshe can invest in one GTM
company, it would be Clay.
And we're not investor at Clay,so we have no bias in any
direction here.
But uh the news came out todaythat they passed 100 million in
ARR.
Zero to one in like six years,and then one to a hundred in
like two years.

Paul Irving (01:40):
Interesting.
What'd you get from that?
Yeah, very interesting.
The important caveat we shouldmention uh for Cassie's
selections that it was GTM Techover a billion value.
So we gotta give Cassidy thatcaveat so uh but uh a couple of
things stood out.
I mean, Clay did a greatbreakdown about you know what's
really worked for them andmostly in the last two years

(02:00):
when they've had this incrediblegrowth path from one to 100.
Uh one thing that stood out, andyou and I have talked a lot
about uh is usage-based pricingand how common usage-based
pricing has become in today's AInative world.
But Clay made that decisionbefore it was popular.
It was against the grain at thetime.
Uh, and they talk about how, youknow, whether it was their

(02:20):
investors or advisors sayingyou're gonna leave so much money
on the table, every other GTMtype company is pricing per
seat.
And you're selling into thesebig companies, they top about
how great their you know,enterprise NRR and expansion and
retention has been, uh you'regonna leave so much value on the
table.
But they knew because of thenature of the product, you know,
such a product-focused company,uh, it was gonna be a you know a

(02:42):
handful, sometimes a few morecore users on each team, but
they're gonna use it in ton uhand it can power so much if
you're go-to-market motion.
But a lot of that usage is gonnabe concentrated into a few
people.
And so if they were gonna bepricing per seat in retrospect,
you know, they'd be leaving waymore value in a table than if
they did the traditional perseat.
Yeah.

And it was um, you know, one of the big reasons
for investment in paid pay.ai,which has allowed everybody to
essentially uh, you know, domargin management, metering,
billing for credit consumption,credit usage.
And there's so many differentways you can do credits.
You can do credits based ondata, you can do credits based
on outcomes, actions taken, allthese different things.

(03:21):
So I think we'll start to seethe world go in that direction.
I wouldn't be surprised if wesee other layers in these
spaces, instead of selling thesecommoditized things like data,
more go towards we're gonna sellcredits that get danged for uh
the workflow or an action takenor other things like that.
So excited to see where thatgoes.
I think another thing that theythey did very well on the

(03:43):
category creation side,obviously, they paid a lot of
attention to brand and oh claybrand is great, but um the devil
side, the devil has sort of oflike the agency model that they
created, which is these agenciesall essentially built as a
businesses on top of clay.
And you either have somebodyinternally that's a growth
engineer, or you have anexternal agency that's a growth

(04:04):
engineering agency that usesclay and and you know uh manages
that process for you.
It's a double-edged sword insome ways where it's like you
get these agencies marketing onyour behalf, selling on your
behalf, building theirbusinesses with your product.
Uh on the other side, it opensup opportunity for other

(04:25):
companies to come along in thenext iteration or you to have
this conversation internally oneday where it's like do we
cannibalize that and making theproduct simpler to somebody else
won't make it simpler, allowpeople to use a touteheading or
growth engineer or other agency.
So we'll see where that uh goesfrom here.
But they've done a phenomenaljob of getting buy-in from the
community, we're getting buyingfrom those agencies.

(04:46):
I think they did a very earlyout Slack community that was one
of the best customer communitiesI've seen executed.
So uh done a fantastic job fromfrom you know from the last two
years.
And then, all right.
So what is it, one to a hundredmillion?

One to a hundred million.
I I I think uh where they did agreat job of is pairing the
brand and thought leadershipside with the agency side of
things, because we've seen ittoo.
You could get caught sometimesif you're selling in initial
customers ID agencies, theydon't want their customers using
it because they want you knowpeople coming to them.
You get stuck selling toagencies and them kind of you

(05:19):
know keeping the secret aboutyou know the power of your
product for what it can do.
Uh they kind of you know,double-pronged approach where
they had these agencies comingin and using it, empowering a
bunch more customers andcompanies to be using clay, uh,
but also had you know, there'sLinkedIn, Twitter, Slack
community that you mentioned, uhalmost evangelizing the product,
crux.
And so you don't get kind ofstuck in the agencies only, you

(05:42):
get you know broad-based uhadoption across customers,
across community, across uh theuh the agencies that started
being you know the first changesof product.

Yeah.
Well, you know, they're they'realso going up against kind of
this new world that AISDR.
Um and I don't know how thatmanifests in terms of you know
if if Clay uh adds a lot offirepower to those companies or
if that ends up superseding.
Uh, but there's been a ton ofdebate on AISDR when AISDR came

(06:15):
first came out, I think, withcompanies uh we'll name them,
but like there was a lot ofspray and print.
They had a lot of like, hey,this is gonna burp your beep
list and this is gonna work, andyou know, the the message isn't
good enough.
So I think what you're seeingright now is like there's
probably, you know, for everysegment of your business, SMB

(06:35):
mean market enterprise, and thefair review ons disgusted, but
like there's probably eightsteps you can get from a um, you
know, in sales process, fromlike the the the moment this
company finds you to the theclosed deal, and let's call that
like an eight-step sales bus.
Well, an inbound use case mightbe able to get you, you know,
from step one to step six withlike SB customers, or even maybe

(06:59):
the entire way.
For min market, it might do tostep six.
For enterprise, it might do tostep three.
Like all of that is superimpactful.
Like it's it's what we're seeingis a lot of data points on like
the buyer is a lot further alongby the time they speak to a
salesperson than they ever havebeen in the history.
And I think like that's the keything, is like they're actually
like closer to making adecision, a purchasing decision.
And whether that's the AISDR ortheir ability to do deeper

(07:22):
research, but it's likeshortening these sales cycles,
and I think AI is having a lotto do with it.
And I had always thought thatlike AI sales will never exist
until the buyers were completelyAI.
And it's one of those thingswhere it's like um the
incentives are not alignedbecause like the person, the the

(07:44):
buyer never wants AI to be thebuyer because then they're out
of a job.
So like they almost like we'llnever implement that fully.
So it's one of those thingsthat's gonna stick.
But you're actually able to getlike so much further now.
So we're start I think we'restarting to see like AI, BDR
really start to take hold, startto work, move those PDRs into
higher value roles, uh, cash tothe value there.

(08:05):
I think obviously as you s asyou move up in segments, a
person matters more.
Yeah.
And there's still a lot of thetry-true playbooks that matter.
But uh, you know, we're seeingcompanies like Abarra in one
mind, Cast talks about whatwe're investors in Barra, uh,
but coming out with a lot ofthese these, you know,
role-playing or uh likevirtuals, essentially reps that

(08:30):
come in place SDRs, solutionsconsultants, customer success
managers, and they're full withall the knowledge bases that
respond on time every time,right?
So like two things that humansaren't necessarily consistent
at.
So I think we're actuallystarting to get from a cooling
of like the the base hysteriathat we were at, like the the

(08:52):
first inning hysteria to likethis point where it's oh, does
actually have a a valuable usecase here, and maybe it's not
the whole thing, replacingeverything, like spraying prey,
but there's something.
What do you think about that?

Yeah, I it's it's almost like surprise, surprise.
New lines matters in this.
Yeah.
It was uh in the early days, itwas it was binary.
AIS CR works or doesn't work.
It's either gonna burn her boolelist, and uh, you know, you're
gonna have your domain shot, andthere's gonna be all these
problems, and your customersaren't gonna like these parents
on the other side of it, or it'sright, look at the amount of
reads we're booking, efficiencywe're gaining on the

(09:26):
go-to-market side.
It's fantastic.
In reality, just as youmentioned, every company is
gonna be a little bit different.
Every go-to-market motion isgonna be a little bit different.
And there are some huge valuegains for certain segments of
the market or certain parts ofyour go-to-market potion.
So in the environment BDRexample is that he just bench
it.
Sometimes a customer wants totalk, sometimes they're with
checking out your website at 11p.m.

(09:47):
their time, and they don't wantto have to wait three days to
get booked with a BDR who'sfresh out of college and might
not even know all the productfeatures and security features,
you know, of your platform.
Instead, you can talk to an AIbooty r right there, get most of
your questions answered, andmove yourself through the buying
funnel.
I mean, Cassie talks about it,but the way buyers want to buy
is also changing.

(10:08):
And so you can meet them wherethey are.
You can say the same thing withAI and some customer success uh
use cases.
Sometimes you have a big problemthat you meet a human on the
other side, but sometimes youjust need something fixed.
And an AI CSN is going to beavailable 24-7, any time zone is
going to be able to triage agood percentage of your

(10:29):
potential tickets, potentialproblems with dust spars.
Uh, and so it's not this binary,it either works for us or it
doesn't.
I think uh products in themarket and companies that are
building are for this, butyou're seeing buyers be ready
for it as well, where hey,there's some real value to be
had in our org, but we just needto decide what the right fit is.

Yeah.
Where are we thinking that'sgonna go to?
I guess what are what is thenext evolution of that?
Like, are are people going tofrom here trend more in the
direction of completelyreplacing their sales teams?
Or do we think that this kind ofthere's a little bit of like

(11:06):
limited stasis for a while inwhere we are?
And like what are we optimizingfor?
I guess okay, yeah.
Because that you know, we don'tdo a ton of GTM investing, I
think for uh multitudinicreasons, but um, you know, we'll
always take a look at the bestcompanies that are out there,
and we're in quite a few ofthem.
But there's significant I thinkheadways in a lot of these

(11:30):
areas, and then there's alsoturn in tots.
It's like what's working nowApple won't be what's here in
five years.

Yeah, I almost look at it like incremental change
versus overnight wholesalechange, where you know, do we
look at inbound BER in a year'stime?
Is you know, a tech forwardadoption is 70% of that job done
by some of these AI FIFOMs.
I think you could see a worldwhere that's true.
Uh, you know, outbound STR isthat for high velocity SMB, you

(12:02):
know, long tail market segments,is that adoption and success
look something like 50% marketpenetration?
I think that's possible.
Will that work in an enterprise?
Probably not.
Uh it's not a good fit there.
I think you'd be seeing the samewith some of these AI customer
success platforms.
Is it triaging 60, 70% of yourtickets?
Absolutely.
Uh, but you would, I mean, Clarkdid this very publicly, but they

(12:24):
would say, you know, replacingour entire customer success or
customer sport or with AI seemedlike a little bit of a, you
know, a PR function to a certainextent.
But then, you know, come backand say 12 months later, all
right, we'll replacing 30% ofit.
That math seems about right.
Uh where it's not that it'sgonna be this zero or one

(12:45):
replacement one way or theother, but you're gonna start
seeing people adopt it.
And the penetration is justgonna creep to creep as long as
the platforms uh that areproviding AI native technology
can deliver on the promise andthat customers are still, you
know, having more successinteract with ECL than they
would if it was just He wouldbut fake job.

Another thing that we're seeing uh in the
marketplace right now is youknow, we had this very 2023
moment where it was declaredthat like GPT wrapper equals
bad.
And then a couple years later,now in 2025, a lot of the GTB
GPT wrapper companies ended upbeing like the fastest growing
wall-type companies.

(13:23):
Um and so there were a lot ofmisses there.
And you know, now we're kind ofseeing similar problems in some
of these companies that are ripit, but maybe going to have a
gross retention.
Is she?
Uh Cassie makes some validpoints in the podcasts.

(13:46):
And I've had some agreement,some disagreement with those.
Yeah.
What are your thoughts in thatin that area?

Yeah, so Cassie wrote a great article on Topline
uh called the Gross RetentionApocalypse.
So she de she definitely standsuh definitively on one side of
that argument.
Uh, but we talked about it lastmonth in sort of this ERR
experimental, you know, revenueversus ARR, too more traditional
annual.
Um and then there's the greatdata points in Cass's argument,
which is that there's a grossretention apocalypse uh, you

(14:16):
know, on the horizon for a lotof these creatively vast growing
AI companies, which is you know,60% of AI purchases are being
made from an innovation budget,which is a non-traditional
budget that came from Menlo.
Um people are typically by, andwe're hearing it, you know, just
from talking to potentialcustomers, by multiple tools
that have overlap so they cantest and iterate and then end up
sticking with the one they like.

(14:37):
And Cassie wrote about it, butshe, you know, wanted to, in a
purely informational researchcapacity, call the logos on a
lot of these basketballingcompanies' website just to see
how they're using a tool.
And then she would frequentlyhear, you know, we're actually
being a turret.
And so there's a demand foradoption like we've maybe not

(14:58):
seen before in a generation oftechnology where companies don't
want to be left behind on the AIrevolution, so they're buying
and testing tools faster thanever.
Uh, but it also, and this iswhat Cassidy calls for, a you
know refocusing on customersuccess or a reinvigoration of
customer success as a functionwithin go to market where you
know, time to value, how fastcan you get customers, you know,

(15:20):
getting ROI from your product?
How sticky can you make theproduct?
Uh forward deploy customersuccess reps.
I guess that's something thatwe're gonna see in some of your
larger customer segments in thefuture.
I know you have a slightlydifferent take on it, but there
is some interesting data pointto say, hey, we we should be
looking at this.

Yeah.
I mean, I think there's there'sthere's a lot of uh there's a
lot of companies right now thatare having problems with that
time to value, that onboarding.
Uh I think honestly, if you're aPLG company, it's much easier
for you to kind of show thatvalue quickly, get people all
good running in your product.
The companies that are moreenterprise, stickier, uh, you

(15:56):
know, we're getting calls from alot of those companies that are
like, I have a crazy pipelineright now, but like I can't get
people onboarded fast enough, sothey're trying to figure that
out.
So there's a balance ofdifferent ends of the market.
I think, you know, from a uh youknow, ring the fire alarms
emergency type situation whereit's like there's all this
experimental revenue and thischurn that's happening.

(16:18):
You know, it's one of thosethings where similar to the 2023
GPT wrapper thing to now, it'slike, well, is this a feature
not a buck?
Does this actually like getfigured out over time?
And like it's okay that it's alittle bit of a leaky bucket
because the products are justgetting so much better so fast

(16:40):
that as long as they're gettinga lot of the hype, a lot of the
buzz, there's people coming inand trying to like you're going
to build the mousetrap.
It's going it the the it's goingto work.
And then what it does, it'sgoing to capture that to make
you going.
But in the meantime, likeinstead of focusing on that
fallout, that let's just keepfocusing on like this piece.
And like once this is good, wefocus on this piece, and like

(17:02):
never almost focus on thispiece.
Like this piece doesn't even endup like you have to catch
anything falling if like thisactually just keeps working.
It'll be interesting to seewhere that nets out.
I think that's the what thedebate is.
So I I don't necessarily likedisagree with Cassie on this
kind of uh ER, I spent Americaexperimental revenue error that
we're in right now.

(17:22):
I certainly think that's athing.
I do think that uh in terms oflike the retention side of
things being from not gettingthe most value out of the
product, I think that actuallyends up getting fixed.
I think the piece that we willlose probably in 26 or 27 is
you're not gonna have teamstrying five different of the
same products, right?
Like you, you know, the themarketing team has to pick

(17:44):
between anything lovable or ultoat all, that they're not gonna
use all three.
Um, whereas right now you mighthave one team using this, one
team using that, one team usingthis, one team using all three
just to see which one's gonna bebest, right?
And they're paying for the all,and then it's like, okay, well,
there's gonna be a CFO record.

Yeah, I mean, we've seen it in in cycles before.
I don't understand why thiswould be any different.
Quality wins out.
So what what is likely happeningis is the gross retention
problem gonna happen for thebest companies?
Probably not.
Those are the ones that buildthe best products, have the best
brands, delivering the mostcustomer value on the other
side.
The cause the companies that aregonna have a gross retention

(18:21):
problem were the ones thataren't delivering enough value,
which are probable products thatshould have grown that fast in
the first place.
And so it's almost like siftingout the, you know, the silk for
gold on the other side of it,but the quality companies and
platforms wonder.
Uh and then the other thing,which we talk about, and we've
got a few companies in theportfolio that that I would say
meet this description, are goingthrough, despite the fact

(18:42):
they're selling new age AIproducts, true enterprise buying
cycles.
And they still have to gothrough procurement and legal
and security and have you knowyour economic buyer, multiple
champions across theorganization.
When they're in place, theydon't get crypto.
It's it looks like traditionalenterprise B2B software.
Yeah.
And so even though the fastestgrowing sort of self-serf signup

(19:04):
PLG tools are gettingheadlights, I think there's this
second wave of enterprise firstAI companies that uh aren't
getting the same buzz on Twitteror LinkedIn today, but you're
gonna hear for the next 12 to 20from Arts.

Yeah.
Last topic on on this is uh, youknow, you are seeing so many
companies get funded right now.
Great ideas, cool, right?
We know innovative concepts, butthat means a lot of competitors.
Uh we just listed one set ofanything lovable bull.
Uh uh, you know, we talked uh atlength about uh uh quite a few

(19:39):
of these other categories whereit's just like wow, this is
really cra cra crowded, uh,Harvey, Libora, you name it.
Um and my comment to you wasthat and it was an unpopular
opinion was that I actuallythink it's good to have really
strong dependers.
And then like two days later,the Calchi you're dying out

(19:59):
because.
But yeah, I like my own popularopinion on on all this is that I
think it's really good to havegreat competitors.
I think they push you to bebetter.
Uh they help build the market,build the category.
Uh and the third one iscertainly nuanced, but like I

(20:23):
actually think it's helpful whenyou have a competitor that's
good when you're fundraising orhave conceived.
You know, in some cases, yeah,sure, they'll be like, Oh, that
club that company raised a tonof money, they're running over
the space, like we don't want toinvest in over two.
But I actually think it's betterthan like, oh, you know, we saw
a company that did this before,it didn't work out, so we're not

(20:44):
gonna build with you.
And it's almost better when youhave a successful competitor
where it's like, okay, cool,like this works.
And it also means that likereally smart people are building
in your space, competent peoplebuilding in your space.
There's a great so I thinkthat's you know, one interesting
wrinkle, one interesting nuanceof this whole era that went
right now where everything'sgetting funded, is uh some

(21:06):
really smart people working onsome really awesome things, and
even if there's multiplecompanies in each space that's
gonna push all those to bebetter.

Yeah, I know I gotta bring my hot take next
time.
I like this one.
Uh and you lived it firsthand.
I mean, outreach salesoft was anincredibly competitive category,
it was a new category, and youknow, you were on the front
lines of the brand and marketingand execution side of that one
marketing.
Yeah.
We talk about it all the time ingeneral when we look at
companies in competitivecategories, but it can be the

(21:33):
thing that pushes you togreatness in at speed, at a
velocity, uh hiring the besttalent.
There is a gravity that comeswith competition because there's
a gravity that comes with acategory where there's a lot of
customer value.

You hire people who are competitive, which is
great.
Take part in their company, it'sit's community building.
I think there are a lot of brosthere.
All right, without further ado,let's kick it over to Cassie
Young, general partner withprimary venture partners.
All right, Cassie, how youdoing?
I'm doing great.
Thanks for having me, Max.
Yeah, in my mind, at least,you're the person, um, at least

(22:09):
the first person that comes tomind when I think of operator to
VC pipeline.
Um, you know, there's a lot thatgo from operator to operating
partner.
Obviously, there's quite a fewfolks that go from finance to
VC, um, you know, founder to VC,even engineer to VC.
But to be a GTM leader um kindof in your past life and now be

(22:31):
an investor VC, I think that'spretty unique.
Um, how did how did that evenwell?

First off, that's very kind of you to say, and I
would also say right back atyou, because when I think about
this category, I tend to say thesame things about you.
Um, so we'll have a funconversation today.
Um, but I'll actually tell you,this was kind of an accident for
me, which feels weird to say,but I always tell people I
didn't have a long-term careercareer ambition of being in

(22:56):
venture capital.
But I think the road is long andeverything happens for a reason.
So, you know, as you know, Ispent 15 years in venture-backed
startups, all in go-to-marketroles across marketing sales,
customer success.
And, you know, primary, the fundI'm at today, is a 10-year-old
fund, but I like to say that Ihave a 15-year history with this
firm.
So the way this math checks outis Brad Srluga, who's one of our

(23:20):
co-founders here, had anotherfund before primary and led the
series A investment in abusiness I was working on when I
was in business school full-timein 2010.
I wasn't a founder, but I was areally early employee.
And I got this amazing exposureto him through the board.
And we kept up personally andprofessionally over the years.
And when he started primary withBen's son in 2015, I met then

(23:40):
and I shared that wholelong-winded history because it's
ultimately the relationshipsthat really spurred me even
considering this as a potentialpath.
Right.
And, you know, a lot of times Iget asked this question of,
well, how do I find those jobs?
And what I tell people is,you're not going to find them,
right?
You have to be sort of soughtout for them.
And the number one way to dothat, I think, is to build

(24:02):
relationships with existinginvestors, right?
Because even if they don't haveopportunities, they have
networks of people, right?
And getting in through a warmreferral, just the same as any
other go-to-market channel,right, is the fastest way to
come in there.
But very candidly, you talkedabout, you know, not just making
this leap from operator but tooperating partner and then to
investor.

(24:23):
You know, I'll share that when Icame to primary in early 2020, I
was very vocal with Brad andBen, our co-founders, that I
didn't know if it was going tobe a two-year home for me or a
many decade home for me, right?
And it actually came back to me.
My last company sail through,you know, we had sold into a
private equity roll-up and Istayed around and worked on that
for a while.
And um, you know, after I waslike through the one year mark

(24:46):
there, I ended up chatting withuh Bill Gurley from Benchmark,
who had been on our board atSail Through about just some
career advice for my next move.
And he said something to me thatwas probably one of the best
pieces of career advice I evergot in my life, where he said,
Your phone is about to ring forall these jobs that look like
the one you just had.
Do not take any of those calls.
Meanwhile, I was like midwaythrough process.

(25:06):
I was like nearing the offerstage.
And in the background, Brad atprimary, he'd be like, You
should just come do this.
We want to build a differenttype of venture firm.
We really need operator DNA.
And I thought to myself, well,maybe I'll go try this.
And I said to myself, there's acouple of different paths that
could play out here.
Maybe I'll like venture capital,but my husband would tell you, I

(25:28):
actually thought that was likeprobably not gonna happen,
right?
Number two was maybe I'd want tobe a founder after being a right
hand to a CEO a few times over.
Number three was maybe I wouldgo become the CEO of a company
that really outgrew itsfounders.
Or fourth was maybe I would godo the CRO thing all over again,
but in a totally differentindustry.

(25:48):
And any which one of thosepaths, doing the venture thing
was gonna fortify the personalbalance sheet for doing that,
right?
More fundraising exposure, morebusiness model exposure.
And I accidentally fell in lovewith venture capital along the
way, but I actually didn'tinvest for my first two years at
primary.
And I did that by design.
I took a number of board seatsfrom Brad and Ben because they
were just totally overloaded.

(26:09):
So I got immediate boardexposure across a number of
different places.
Um, but I wanted to make sure Iwas going to be here for the
long time before I did that.
And in hindsight, I think thatwas a very, very smart move.
Um, I think I had a steeplearning curve as an investor,
regardless of waiting.
Um, but I think it could havebeen really ugly, uh, quite
frankly, you know, with thebenefit of hindsight if I had

(26:29):
jumped right into it.

Yeah, well, you got that experience.
Obviously, uh Brad and Ben were,you know, great mentors for you
in that situation.
Yeah.
So we got uh Craig Rosenbergfrom Scale, Bill Binch from
Battery, uh Dennis DeAndres atuh iconic, you got Hillary and
Jeremy at um Insight Partners.
You've got a lot of GTMoperators who went into BC, but

(26:53):
they became operating partners.
Um here, with obviously thementorship from Brad and Ben,
you know, you're an investor,but you also have a platform
team as well that you managethat supports these portfolio
companies.
Can you share a little bit moreabout that?

That's right.
I'll share more about it, butfirst I'm gonna do a little bit
of a wrist slap situationbecause we joke that we have an
allergy to the word platform uhon primary.
It's here the market exam.
Okay, the lowercase P platform.
We're cool if it's the capitalthat bothers us.
Yeah.
So we call um our portfoliosupport team the impact team.

(27:28):
We actually used to call it theportfolio impact team, but
portfolio felt too primary andnot enough about the founders,
right?
So we now just call it theimpact program.
But yeah, I have a bit of aninteresting role around here
where, you know, I spend some ofmy time as an investor, some of
it running the impact team.
And then I actually run ourbroader firm operations as well.
So I laugh when friends ask me,when are you gonna go back to

(27:49):
operating?
And I'll tell them we weactually are an operating
company at primary in many ways.
But yeah, let's talk a littlebit more about the impact team.
So I'm really gonna give thecredit to Brad and Ben for
having the vision to do this.
And they really asked me to comeon board to help them bring that
vision to life, right?
And professionalize what theywanted to do.
So let me give you a little bitof history.

(28:09):
Uh, Ben was an entrepreneur in apast life, and he likes to say
that he was a customer of theventure capital asset class with
a really crappy net promoterscore, right?
And when he started primary, hewanted to build the type of cap
table that he wished he couldhave had as an entrepreneur.
His view on how to do that wasirrespective of who you are as a

(28:30):
founder or how well connectedyou are, in the early days, your
company doesn't have brand,right?
And you can't attract or affordthe level of talent you want,
right?
Maybe you can get some customersthrough the existing
relationships.
And so his view was what if wewere willing to invest in
bringing operating partners intoseed, which was very, very

(28:50):
unheard of at that time.
And honestly, still you don'tsee it in many places today,
where we said, hey, we bringpeople who've had these C-level
jobs and give the portfoliocompanies access to them.
And the belief is not that thesefounders aren't perfectly
capable on their own, but thattime is the scarcest and most
valuable resource that theyhave.
And if we can accelerate theirability to do the early work

(29:12):
streams, it future-proofs thepath to Series A and also really
accelerates the speed of gettingto Series A.
So that was kind of always thevision and mandate behind it.
Um, so when I got to primary2020, uh, we had, I'll call it
sort of three and a half peopleuh working in different
portfolio-facing jobs.
And um, a huge part of my remithas been figure out how we scale

(29:33):
that.
And so today uh we have almost30 people um working on that
team.
It's um more than double thesize of our investing team,
which is a fun statistic.
Um, but there's really threecore pillars of that program,
right?
And it comes back to whatmatters most to early stage
founders.
It's um getting the right peoplein the right role.
So for us, that's what we callour people and networks

(29:53):
function.
The second is securing yourearly customers and making them
rabid for the product, right,which is go to market.
And then the third is makingsure that you're gonna have a
really compelling narrative fordownstream fundraising.
So that's the strategic financebucket for us.
What's happened over the courseof the past five and a half
years that I've been here isthat we've transcended just the
operating partner model, right?

(30:14):
So we still have a senior personeating, leading, excuse me, each
one of those domains, but theyare supported by more ICs,
mid-level management resourcesthat are doing really hands-on
keyboard work for the portfoliocompany.
So if we think about go tomarket, right, um, that's led by
my partner, Jason Gelman, who'san operating partner here,

(30:35):
amazing revenue strategist,RevOps guy in a past life was
with Compass from Series B toIPO.
Jason has a couple of differentthings that sit in go to market
right uh right now.
He helps with go-to-marketadvisory and hiring and all that
fun stuff.
Um, but we also have a huge teamthat we call market development
that's actually going outtalking to economic buyers and
building pipeline on behalf ofour portfolio companies.

(30:58):
We most recently added afull-time resource to primary
who's tasked with go-to-marketinnovation and engineering,
right?
Who's doing that for theportfolio companies full-time.
So that gives you a taste ofwhat impact looks like.
But what I'd be remiss not tosay is that I actually think the
magic happens at theintersection of those functions
and the connective tissue.
So if we go back to go tomarket, you know, we also have

(31:18):
this strategic finance function.
A huge part of what we do whenwe help for series A readiness
is thinking through what I calllike the plan to hit plan, right
on the other side of it.
Um Kurt, who runs our financefunction, has a better line for
it, he calls it the path to themath, right?
And so Gelman and Kurt worktogether, right, to go and do
that.
And then they bring in talent tohelp figure out how we're gonna

(31:40):
go and actually hire the AEcapacity, right?
To go and do that.
So that you have each of thesesilos, but really I think where
the magic happens is as they umcome together to support the
portfolio companies.

That's great.
I mean, it sounds like you havethese kind of built-in playbooks
that you bring to your portfoliocompanies and help help them
increase the odds of success,you know, in various areas of
their business.
Yeah.
How did we build the GTM fundback office?
Easy.
We leveraged Angelus rollingfund product for fund one, which
was the perfect vehicle to scaleup GTM Fund in its first

(32:11):
iteration.
This structure allowed us tobuild our network, add revenue
leaders, and deploy capital allat the same time, which was
crucial for getting early pointson the board and building
relationships with founders.
Fund two, we transitioned to atraditional closed-end fund
structure through Angelus, thistime with institutional investor
support.
This model allowed us to be moreintentional about our portfolio
construction.
We worked closely with theAngelus team throughout this

(32:33):
process and they wereincredible.
Always there to support us andour LPs every step of the way.
If you're raising a fund orlooking to migrate your fund, we
highly recommend you check themout.
You can do so at Angelist.comslash GTM fund.
That's Angelist.com slash GTMfund.
I want to come back to thatlater in the episode.
What I want to get into now ishow do you decide what companies

(32:53):
you're going to invest in?
Yeah.
So I'd like to understand fromprimary standpoint, like what
percent of your deal flow isinbound?
Yeah.
What percent of it's outbound?
And you specifically, like, howdo you find these companies and
then also size them up forinvestment?

Absolutely.
So lots of things to unpackthere.
So in no particular order, Iwould tell you that a lot of the
deals that we do come inbound tous.
Now they may come inbound inlots of different ways, right?
Um, very often they come inboundthrough a founder in our
portfolio, right?
So uh the number of healthcarefounders in the primary
portfolio who came out of Oscaris high, right?

(33:31):
Because you back one of them andthen they send you other amazing
operators that were there.
We also get quite a bit of dealflow from later stage investors,
right?
So I think about one of myportfolio companies, Lyric,
which is now a Series Bbusiness, it actually got sent
to us by Goldman Sachs, right?
Because the founder had hadanother business in a past life.
He had worked with Goldman inmore of a scaled capacity.

(33:51):
Um, one of my colleagues, theprincipal who works with me,
Zach Fredericks, had a greatconnection with a supply chain
guy at Goldman, and it cameabout that way.
So there's a lot that happensthat way, but we're always
thinking about outbound as well.
And you get it, you do earlystage deals.
It's always this question oflike, where do you really find
alpha with that?
And I think for us, it's thisquestion of you, you there's no

(34:13):
such thing as finding someonetoo early, meaning the best
deals we can do are the peoplewho are still engaged in their
full-time jobs at anothercompany, right?
So we do all of the stuff thatevery other venture fund on the
planet does now, where it's wehave the LinkedIn stealth
scraper, but all of that stuff'sbecome commoditized, right?
So the fun thing for me actuallyat primary is how do you use a

(34:35):
go-to-market brain, right, tothink about where you might find
some of those people beforethey're ready to actually pull,
pull the switch and go and doit.
And I think this is the hardestpart of the job because there's
a CTO in my personal portfolio,Bay Area-based, amazing guy.
I had breakfast with him acouple of weeks ago and I said,
Humor me.
When you were still in your lastjob, right, leading this

(34:56):
engineering team, like how manypeople hit you up?
And it was insane, right?
So you really have to thinkabout what's the value exchange
you can offer if you're gonna goand do that.
And I wish I had the perfectanswer to that question.
I'm like figuring that out weekto week and just not afraid to
try new stuff to get theirattention.

Well, it's definitely good to go ask your
portfolio companies, like, whatwas your criteria?
What were you looking at?
Or, you know, how would um howwould I have an as an investor
been able to get your attentionearlier?
That's right.
Um what were the things orcatalysts that'll that made you
decide to start a company?
And so how do I start lookingfor those same catalysts and

(35:34):
trends?
That's exactly right.
Okay, well, within this company,there's a bunch of engineers who
are gonna go start their owncompanies because when that same
thing happened at this othercompany, a bunch of engineers
went to start their owncompanies, right?
So you're always looking forthat edge, you're always looking
for, you know, trying tounderstand uh, you know, what
what is gonna be the tippingpoint that's gonna make somebody
who's you know happily employedat a larger company, but it's

(35:57):
gotta be a good founder one day,that's for decide to take that
leap.

100%.
And my thing is also like, evenif they're not gonna make the
leap to be a founder, because ofeverything we do on the
portfolio impact side, I justwant to know the best talent,
regardless, right?
So, you know, if they if wethink they're gonna be an
amazing founder and they'relike, I want no part of that,
well, maybe they would be agreat early product hire, right?
Or whatever um the right pathmight be.

(36:21):
But, you know, once we uh makecontact, right, and are really
thinking about how to invest, Imean, much to my chagrin as a
self-proclaimed data junkie, Imade my whole career on being
good with data via GM, you and Iboth know in the early days, we
don't have that luxury, right?
We have data on the market size,and that's about all.
And so at the end of the day forus, really we're making a bet on

(36:44):
the size of the marketopportunity that the person's
going after, and then the team.
And at the end of the day,particularly in the era of like
the AI explosion, everythingelse, it comes back to this
first principle of who is thefounder that you're ultimately
backing.
So let's talk about the founder,right?
Because at the end of the day,that's the core of everything
that we do.

(37:05):
So we have this founder outcomesframework that we use that we're
always thinking about in thebackground, both when we do new
deals and then when we reinvestin portfolio companies as they
grow and scale.
My partner Rebecca Price, wholeads our people in networks
practice, helped us put thistogether.
There are five elements to this,right?
So the first is this ability toset the vision.

(37:25):
This is not rocket science,right?
We all talk about it all daylong, right?
But what we don't mean by thatis just get people excited or an
ability to be a greatsalesperson.
We are really looking forsomeone who has an earned secret
or some type of market edge,right?
That, you know, people talk itabout the, you know, founder
market fit, et cetera.
I don't think there needs to befounder market fit, but there

(37:46):
needs to be some, you know,compelling uh component to that.
Number two is the founder has tobe able to sell stock, right?
Because at the end of the day,right, you have to be able to
raise capital for your business.
It's really important.
So of course you need to be ableto sell customers, you need to
be able to sell employees, butyou do need to be able to raise
capital for the company.
Number three, relatedly, is theability to hire talent, but

(38:10):
importantly, hire amazingtalent.
And I'm happy to spend more timeon this later, but I see it
particularly with youngfounders, where the make or
break can be well, am I gonnahire someone who's like a friend
of mine, or am I gonna go findsomeone who's totally gonna be a
complete bar raiser for thebusiness?
And I have a couple of funexamples of that we could share

(38:30):
later.
Um, fourth for us is actually anewer one that we've really
started talking about in the eraof AI, which is this concept of
what is the jaw-droppingcustomer experience?
We call the JD CE.
Um, I think Neil Meta fromGreenoaks was on Invest I the
Best talking like this recently.
This actually came out of BOM atcoupon, right?

(38:51):
So Neil and my partner Ben areon the board there.
Bomb in the early days of couponwas like, I'm gonna blow
customer expectations in termsof how quickly I can get them
goods.
In the AI world where there's somuch stuff being built.
We're like, really, what isgonna be the undeniable magic
for the customer?
And then the fifth thing isreally focused on are they a

(39:11):
learning machine?
Right.
And that is really hard to teaseout in a couple, maybe a
two-week diligence process ofwhat's there.
But the way we try totriangulate that is actually
looking at their past in termsof the really hard things that
they've, you know, had to figureout along the way.
So that those are kind of theelements that we'll consider on
the founder side.

(39:32):
Happy to dig in accordingly likewe, there's lots we didn't talk
about in terms of like what welook at on the market side or
would-be customers, et cetera.
But those are just, you know,some of the broad strokes things
that are top of mind.

I think that lifelong learning piece and uh
the passion that they have tohave for the topic is so
important.
You know, people talk about thenine nine six and all that.
And it's like, well, the hour,if you're counting the hours,
you've already lost.
I actually think you like it'syou know, we we've had this
conversation at uh at the fundquite a few times.
Times and you know, we try toback a lot of operators turn

(40:03):
founders, and we've got a hugenetwork of it.
Um, but there is somethingincredible about, you know,
three people in their 20s thatreally have nothing, no other
responsibilities or prioritiesin their life.
And yeah, they're hyped up oncoffee at 3 a.m.
on a Saturday morning workingthrough some kind of use case
for their product.

(40:23):
And that's right.
They're doing that because theylove it and that's all they
want.
For sure.

I don't know if you follow their at Beehive, but
he has this great, he builds inpublic.
They're not a portfolio company,but I've known Tyler for a long
time, a huge fan of his.
Um, I regrettably passed on thatone, which was a which was a bad
pass.
And sit portfolio's selfie.
I don't, but I know.
But I I've known Tyler a longtime, but he builds in public
and he talks about I I don'tknow if this is still the case,
but months ago he had this postabout how being single was his

(40:48):
competitive and being usedhitch, which I totally buy.
But here's what I'll say abouteven not the young founders.
Um, Jason Gelman on our team hasthis term that he uses that I've
started borrowing where he'slike, is that founder deeply
serious about their craft?
Yeah.
And it sounds like such an easyway to describe something.
But I think about someone like,you know, Amanda Kalo in our
portfolio who's running OneMine, previously started Six

(41:09):
Sense.
Amanda, you know, has beenaround the block in her career.
Amanda, I think I was jokingwith you when I came in here.
I'm like, you know, she's threehours behind me, and I've
usually already spoken with herby 7:45 in the morning.
Right.
And it's I'm talking to her on aSaturday and she's apologizing
about her kids in thebackground.
I'm like, why are youapologizing to me about your
kids?
But she's so obsessed with thebusiness problem that she can't

(41:32):
stop.
And I would say if you don'thave that, venture scale
businesses are probably not theright place to go be a founder,
right?
And there's many other ways tobe entrepreneurial in other
ways.
But as you and I both know, Ialways say like venture capital
is not for everybody.
Like, what happens if you putrocket fuel in a car?
It explodes, right?
So it's uh I I do think it'sit's just absolutely so

(41:55):
important.

Howard Lerman in our portfolios like that.
I mean totally like that.
For sure.
Problem.
Uh, the guy's always on.
Yep.
As kids, always on.
So it's yeah, it's but it is apassion thing.

It's an intrinsic motivation thing too.
And you see it even innon-founders, you see it in
certain operators.
Yeah.
I remember Kurt, um, who runsour finance function when we
were in the final roundinterviews with him, I had a
long format breakfast with him,and he made a comment to me that
he may have since forgottenabout, where he told me that,
you know, his wife made thiscomment to him once that he
can't even take a shower withoutthinking about work.
And I'm like, You're hired,right?

SPEAKER_02 (42:28):
That's like exactly the type of people that I need
around me.
It's a it's a disease, but it'sa fun one.

My my first year post-outreach uh sales hacker
outreach acquisition was likethe most one of the most fun
years of my life because it wasjust like, all right, cool.
Now you're in a massivebusiness, you have a ton of
responsibility, we trust you,go.
And it was like the amount ofstuff that I had to learn, yeah,
the things I got to do, gotaccess to, it just like
completely brought in myhorizons in this amazing way.

(42:54):
And I was just like, I woke upevery day, five in the morning,
like just like, I'm on, let'sgo.
For sure.
Let's start now.
For sure.
I probably pissed a lot ofpeople off.
I say HR, one of the firstthings they said to me was like,
Hey, you send emails at alltimes, and like might be good
for you to just preface thatlike just because you're on now
doesn't mean everybody else hasto be on right now.

(43:14):
Like, this isn't urgent.
And I had to send an email tolike my 20-person team, like,
hey, I'm going to send youemails at all hours.
Totally.
It does not mean that I I willlet you know if I need a
response in like the next, youknow, 90 minutes or whatever.
If not, you can get to it whenyou need to get to it.
When you get to it, yeah, forsure.

I think one disclaimer we have to put on
this is there's a differencebetween activity and
productivity.
Yeah.
Right.
So, you know, when you're deeplyserious, you also have to make
sure that you are focused on allof the right things, right?
And for me, particularly, youknow, having run customer orgs
in a past life, I just believelike if you want the ultimate
hack to building an incrediblecategory-defining business, you

(43:52):
have to be obsessed with yourcustomers.

SPEAKER_02 (43:54):
Yeah.

So I think the other thing that these founders
have in common is that they'redeeply serious about their
customers, right?
It's where it's yes, they'refocused and there's not a day
that goes by that they're notthinking deeply about the the
customers and the prospects.
And they know I always say,like, if you do everything in
your power to make yourcustomers wildly successful with
your product, asterisk withinthe financial constraints of

(44:16):
your business, you would have tocatastrophically screw something
up to not succeed as a company.
And it sounds so stupidlyobvious, but I think you and I
have probably both seen thecompanies where it's like, no,
we're just gonna like build forbuilding's sake.
You know what I mean?
Or we have a belief, do you knowwhat I mean, that this is the
way the world is gonna go.
That has to be married with thereality of meeting the buyer and

(44:38):
more importantly, the endcustomer where they are.

Yeah, it's really an interesting topic too,
because I think a lot of umfirst-time entrepreneurs,
first-time founders, they'll goget what they call design
partners and then they'll startbuilding for that design
partner.
And you can be very focused andaligned on what the design
partner wants.
But if the design partner is notthe right person in that
business, you're gonna shootyourself in the foot.
So, in a lot of situations, youmight have a founder who's like,

(45:03):
yeah, I've got um a friend whoworks at Stripe.
They're in the perfect role forwhat we're servicing.
I'm gonna go work with them,they're gonna be a design
partner.
Well, if that person's not thebudget holder, then you need to
make sure that they tag in thebudget holder when you become
it, they become a designpartner.
That's right.
And you're mapped to successmetrics that will convert the
design partnership to a paidpilot.

(45:23):
Well, there are there aresuccess metrics beyond that that
convert it to an annualcontract.
And then when you get 10 ofthose, then it's like, okay,
we've got product market fit,let's scale this, et cetera.
But like if you are solelyfocused on this, uh, we're gonna
make this, we're gonna blow thisperson's mind, but they're not
the right person whose mindshould be blown, or you're just
building something cool, but notactually something they would

(45:45):
pay for, yeah, you're gonnaspend uh, you know, all these
cycles on that as a business.

It's so interesting that you bring this
up because I feel like veryoften I get asked this pattern
recognition question around goto market in the early days,
right?
Of like, what are the mostcommon pitfalls?
Right.
And my number one thing I alwayssay is happy ears syndrome,
right?
Where you come in, no one'sgonna tell you you have an ugly
baby, right?
And you don't frame thequestions the right way.
And you and I both know asformer commercial people,

(46:11):
there's a right and wrong way todo discovery and to map a
process, et cetera.
And I find, um, and this is nota fault of anyone's, it's just
kind of the function that yougrow up in, but particularly for
technical founders, when youopen their eyes to something
like medpic, they're like, oh myGod, this is so helpful, right?
In terms of these are the thingsI must be able to answer to be

(46:32):
able to look you back as theinvestor and say, I actually
have a legitimate opportunity.
And so, you know, I I often say,you know, when we see pitches,
they'll tell us, well, we hadthis many design partners or we
had this many pilots.
And one of my first orders ofbusiness, right, is to really
understand are those actuallyviable opportunities based on
all of the criteria that youjust spelled out.

Yeah.
Yeah.
So I really want to know what'sa signal that you see that makes
you want to either pause on aninvestment or dig deeper.

Yeah.
So let's start very top offunnel.
Like I'm just looking at anopportunity for a first time.
A huge indication of myexcitement of whether or not I'm
gonna dig in is how quicklywould-be buyers get back to me
about taking a diligence call.
Which I think is people, it's tome pretty obvious, but I I think
every time I share that topeople are like, that's really

(47:24):
interesting because there havebeen pitches where I have
reached out to would-be buyersand that night I have five
people who are willing to do ademo later that week.
If I have to nudge multiplepeople to be willing to throw me
a bone and they're in my closenetwork to look at an
opportunity, it kind of tells mewhat I need to know about market
pull.
Uh, so that's one of my favoritecues that's there.

(47:46):
In general, I really over-indexum that, although I don't know
there's such a thing asover-indexing on the customer
pull for it, but on thoseconversations and just sort of
the level of excitement that I'mhearing and understanding the
other solutions that are there.
Um, so that tends to be just ahuge decision factor for me.

Are there any deals you did recently that you
have an example of where this iskind of like a this was like the
biggest no-brainer type thinggoing forward, or um even maybe
one you paused on that you werelike, oh, that's a red flag?

Yeah, absolutely.
So um I would tell you there's alot of red flag ones.
I uh there's many deals where Iwill have just said, I'm not
gonna move forward because I'mjust not feeling the hair on
fire problem um that we've gonethrough.
In terms of thinking through anexample of one where it was so
obvious, you know, it's actuallynot that recent, but Lyric in
our supply chain portfolio,that's one where, you mean

(48:38):
they're selling into Fortune1000 buyers.
So these are really busy people.
And I actually leverage a numberof folks in our LP base to help
us get in front of those people.
And that was one where the speedat which people were willing to
get on the phone from theselarge, slow-moving companies was
really, really promising andhas, you know, remained the case
today.
So that's probably one of myfavorite examples that these

(49:00):
are, you know, big behemothcompanies where inertia is the
worst enemy.
And so not only are they takingthe call, but they're open to
evaluating something.

Yeah.
I mean, um, you know, I was onuh a phone call as a favor
earlier this morning to a fundwith a um, you know, up and
coming uh native to AI CRM.
Yeah.
Right.
We're seeing a lot of these.
Uh, and I think there's theremight be a couple in your
portfolio even.
I don't know if you're in day AIor Adio or Addio.

(49:28):
Okay.
Yeah.
So it's interesting.
As a GTM operator, um, GTM fund,we've kind of purposely stayed
out of a lot of the GTM tech.
Yeah.

I remember you telling me that.
Yeah.

Is are you seeing the same thing?
I know you did uh One Mind, um,which I think you'd consider GTM
tech.
I think there are probably acouple others in the portfolio.
What do you ever saw?
I saw in the GTM tech space andwe could.

I'm a grudge for punishment.

I was gross.

I love them.
I love them because I was abuyer of them.
But it's really hard becausethere's a ton of crap in that
market.
And so I would say we absolutelypursue deals in that category.
My thinking on it is I'mprobably gonna do one, maybe two
per year that are there.
Now, don't mishear me.
If there were like four amazingfounders building in four

(50:12):
totally different lanes, I wouldlook at them.
But we see a ton of go-to-marketdeals and we pass on almost all
of them.
Um, I think the way we'vethought about it is just to be
very, very thesis-driven aroundour approach.
And so, you know, right now, onethesis that I very much had, and
you maybe, you know, uh uh uhprompted the thought for me when
you talked about OneMind is thatwe're really living in the age

(50:36):
of the buyer, right?
Buying software sucks, right?
Being sold to sucks.
Like I think about all of theseAI SDRs, and I've been regularly
saying, where's my Gmailpromotional tab for all this
crap?
Do you know what I mean?
Because it all looks exactly thesame.
But it's similar.
Like you and I both came up tothe enterprise sales, you know,
school, and we know the, well,you have gating factors to move

(50:59):
from stage one to stage two, andyou can't talk to the sales
engineer until you've gonethrough that.
Um, that's not how buyers wantto buy, right?
And that's really what helped usget conviction when we did the
one-mind deal a year and a halfago, is we knew the world was
going to change away from that.
I think the second part of thethesis, and it plays into the
one-mind deal as well, is somany of these solutions are
still um really fixated onincrementality, right?

(51:22):
It's efficiency gains, 10%efficiency gains here or there.
Those are great businesses,don't mishear me.
But I think that they're really,really crowded categories.
And what I get really excitedabout are the businesses that
are saying you're fundamentallydoing things in a way that isn't
gonna exist in a couple ofyears.
And we actually want toradically transform the way that
you operate.

(51:43):
And one of my favorite salesbooks of all time and still
today, and I really ask everyfounder to read it, is
Challenger Sale, right?
And I'm like, I love what AIcould potentially do by way of
challenger selling, right?
And Amanda from One Mind wouldtell you when she pitches that
business of like, you know,you're humans, they all
hallucinate, right?
Like they're they need to bereplaced by AI.
She'll tell you 50% of thepeople like put fingers in their

(52:04):
ears and think she's crazy.
And that's how she knows she'sonto something.
And I think that's what has mereally excited.
So the incremental solutions andgo to market, it's like a pretty
obvious no for me.
Um, I do worry that I don't evenworry, I know I'm gonna miss
something great, right, withthat approach.
I also think there's somecategories that I had like real
allergies and hangovers to.
I mean, you know, Sail Throughwas a Martech business.

(52:27):
We sold that company for 3x ARRon the nose out of, you know, I
had a number of years of blood,sweat, tears, 90 flights a year
going to do it.
I don't want to sound like anin-grade and like we had an exit
for the business, but I thinklike Martech just suffers from
that.
Yeah.
It's a, you know, particularlywhen I say Martech, I'm talking
about selling into the B2Cuniverse, like what that is.

(52:47):
But surely that's gonna bedisrupted.
So I'll look at things, but Ireally, you know, I mean, I I
think I've given you anindication of the types of
things I'm trying to triangulatein the background when we go and
do that.

Yeah, I certainly think we have a little
bit of that too.
Like we almost like know thespace too well.
Totally.
And so we're we just, you know,aren't taking that much risk
there.
I think uh, you know, point youmade is is fantastic, which is
um it's incremental gains, youknow.
So when you look at, oh, we'regonna displace HubSpot or we're
gonna display Salesforce.
I look at that and I say, okay,well, those are like minor

(53:20):
nuisances that people have withthose platforms, but yeah, they
kind of do the job and do thejob well, and they're leveraging
AI too.
And so yeah, like they'llthere'll be some people that
start their companies and getoff them, there'll be some
people that, you know, arewilling to move, but I think
that's a lot harder than putpotentially going, you know, as
an investor, I can make thatbet, or I can make another bet,

(53:41):
but I only have one bet to make.
So then when I look at a lot ofthis vertical SAS that we're
doing, it's not just somethingexists and it's a little slight
nuisance.
It's like nothing exists ornothing's been recreated since,
you know, the 90s or somethinglike that for these people.
And so now all of a suddenthere's just like massive
platform shift.
So if I'm gonna make a bet as aninvestor, I'm gonna make a bet
on this massive platform shiftversus this kind of you know

(54:04):
incremental increase in what'shappening over here.
So I completely missed too.

I completely agree.
And I'll tell you, you know, onearea I have a lot of energy
around that I've yet to findlike the thing here is software
implementations, right?
And I keep getting pitched thesethings that are like
auto-creating, they're like themodern PSA tool.
Do you know what I mean?
Where it's like, well, we'regonna auto-create all of your
artifacts.
And I think to myself, that'snot the opportunity here to go

(54:29):
and do that, right?
Why are we still living in thisworld of 15-week implementations
where you and I both know phasetwo never happens in them,
right?
Like let's really address thesystemic issue at hand.
So I couldn't agree more withwhat you said, but yes, I'm
keenly aware of the fact that umI will miss some things along
the way.
Um, but it's interesting, youknow, we run twice a year in

(54:50):
off-site for all of ourinvestors.
And and one of uh the highestvalue things I think we do there
is we bring in GPs and partnersfrom other firms as guest
speakers.
And there's always amazingnuggets that come out of that.
And Tom Lavaro from IVP joinedus last year and he had this
great line that really, reallydeeply resonated with me, where
he just reminded everybody that,you know, you're judged on the

(55:12):
deals that you do, not the dealsthat you don't do.
Um, and I think that I have tojust constantly remind myself of
that, knowing that I'm I'm sureI'm gonna miss something great
at some point along the way.
Yeah.

No, the anti-portfolio is a healthy
thing to have, but it'scertainly we are judged on the
deals that we do do.
Um, you know, I think one of thethings I I definitely want to
touch on in this um episode isum what are your thoughts on how
you coach, you know, you investin the pre-seed and seed, how
they build the product for ago-to-market.

(55:44):
Yeah.
Um, I'm actually uh, you know,very close with uh uh CEO of a
public company that's kind ofgoing through a second act right
now.
And we've had some conversationsabout some of the things we did
at Outreach that I wish we wouldhave done differently.
And you know, one of thosethings is um we never built a
self-serve motion.
And that has so much to do withyour sales process, your support

(56:07):
process, all the other thingsthat are downstream of that.
And what I mean by that is, youknow, it's tough to build a
profitable business long termwhen you don't have that.
At Outreach, um, we had aninbound sales development
representative, an outboundsales development
representative, a sales rep, asolutions consultant.
So that was like we sold theproduct to you.

(56:30):
Now, now but now you're acustomer.
Then you go to an onboardingspecialist, ISR, right?
Then you go to a um CSM, who'syour customer success.

SPEAKER_02 (56:41):
And you probably have an account manager is gonna
be.

You have an account manager, you have
customer support, right?
So like it is hard to build aprofitable business when you
have all you're it that it'stouching everything like that.
Meanwhile, you've got um theApollo's of the world.
Uh you know, I personally I wasalways somebody who's like, hey,
we need to get into the databusiness.
We should have that be ourself-serve model, get people in
and then get them onto the theum sales engagement platform.

(57:04):
And I was saying this back inthe you know teens, 2010.
But um, you know, that is itit's a a I guess a way smoother
way to get people into theproduct.
It's the self-serve uhonboarding motion, but then you
actually have less people thatit's touching even along the
way.
And um, and you may do thatdifferently, obviously, for SMB
to mid-market enterprise, but atOutreach, even at the

(57:26):
mid-market, we kind of had to dothat.

Yeah.

It's tough to build a business like that.
So starting at the precede Cstage companies, how are you
coaching them on all the otheraspects of go to market that are
product related?

Sure.
So I actually think it comesback to one of those core tenets
of the founder outcomesframework we talked about, which
was the jaw-dropping customerexperience, right?
Where it may not have to beself-serve, but it needs to be
this transformational moment forthe person on the other end of
the product.
And I think in the era of AI,time to value is like my new

(57:58):
favorite metric on the planet,right?
And not because of just like thefinancial implications of, you
know, the card ARR lag ofgetting stuff live, but because
everybody's trying 20 differentthings.
You know, I was down at thePavilion Go to Market Summit a
couple of weeks ago, and someonecalled GTM tooling uh the island
of misfit toys, uh, which deeplyresonated with me, right?

(58:20):
So it's how are you just gettingthem to those moments of magic
and ROI that much faster thanever before?
And so I think a huge part ofthe coaching that I give
founders is, again, thatmaniacal focus on the customer,
but really the value reiterationback to the customer.
Because at the end of the day,if you assert to a customer that
this is what you drove in termsof incremental revenue or

(58:42):
conversions, whatever, you and Iboth know they're gonna argue
that attribution all day long.
But showing them something isstill gonna get the gears
turning, right?
That you're going and doingthem.
And I think beating that overthe head as frequently as you
can and as far reaching in theorganization as you can is
absolutely massive.
But I would say to that point, Ithink it's really, really
important that people avoid the,you know, peanut butter trap,

(59:05):
right?
Of spreading yourself reallythin by building these super
wide products.
I think nailing the wedges ismassive, right?
Because it's not not only oneensuring that you're not going
to have experimental revenue andpeople churn off it, but it then
earns you the right, right, tokind of, you know, take wallet
share from elsewhere as youbuild additional use cases,
right?
Or, you know, ultimately findthe net retention levers for

(59:28):
your business.
But one point that came to mindwhen you asked me this question
is if you and I had thisconversation a year ago, and
incidentally, I think you and Idid a fireside chat about a year
ago in San Diego, I was up on mysoapbox around uh the zero CAC
founder, right?
That Zach Fredericks works atprimary, started this term zero
cac founder, people who you knowgrew up in the category and they

(59:48):
have the Role Dex and can getthe running start on the go to
market side.
Because we talk a lot about likeland grabs, land grabs versus
moats, which we can come backto.
But today, I'm like, that's justnot enough.
If you don't have the zero, likeyou don't have to be a zero tech
CEO.
We love it when you are, right?
But if you don't marry that withproduct vision and way more

(01:00:09):
importantly, product execution,you're going nowhere.
Right.
And, you know, Cloud of Judgmentis one of my favorite weekly
reads.
And I feel like he had a greatpiece a couple of weeks ago.
And I don't know if I agree withlike the 100% of thesis, but
something in there resonatedwhere it was just talking about
building moats in general rightnow.
And if you think about it, likeevery moat you think you have is
pretty short lasting.
And so really speed to gettingto the next moat is the

(01:00:34):
competitive advantage.
So the provocative question thatwas asked is really is speed the
moat?
And I'm like, I don't know if I100% subscribe to that, but I
have said for the last decade ofmy career that speed is a really
freaking important competitiveadvantage.
And so I think that plays intogo to market, but I actually
think that's even more importanton the product execution side.
It's just again to belavor mycustomer obsession, really

(01:00:56):
important that that's not donein a vacuum.

Max Altschuler (01:00:58):
So we got 300 LPs at GTM fund.
And I can't tell you how manytimes somebody's like, hey,
you're are you hiring?
Like, you know, might want toget into VC next.
What advice would you give toGTM operators or anybody that's
in operating role right now,even founders, um, to
potentially go into VC in thenext chapter of their career?

Cassie Young (01:01:19):
Absolutely.
So a couple things.
Number one is you have to begreat at your job in the first
place.
You and I both know Word travelsreally fast and everybody talks.
So you compete on reputationjust the same as a company does.
So if you're not in the positionwhere you're crushing it, that's
like step one of figuring outhow to go and do that.
And I also think, you know, itreally drives me nuts when I

(01:01:42):
hear these stereotypes about VCof like people thinking it's
some cushy situation.
I this is the most intenseperiod of my career, right?
And so I always like offeredthat just preface for people who
are thinking about it.
I think there are probably somefunds out there where you can do
a little bit of that coasting,but I want to have like a little
bit of a come to Jesus on that,right?
Like I think that's quite a bitof a misnomer.

(01:02:03):
And I know the way you run yourshop, you you feel like
similarly.
But here's what I would say umpeople want to get to know you
and your work, right?
And so finding ways to do workwith venture-backed portfolio
companies or privateequity-backed portfolio
companies is a way to start tobuild a reputation beyond the
one that you already have inyour full-time role.

(01:02:25):
And let's just name it, thatdoesn't mean that you're gonna
get a bunch of paid consultingwork.
You're just gonna have to givesome advice for free, right?
And so I think finding avenuesto do that, most venture firms,
PE firms who want to get to knowgreat operators because they may
have an analogous business modelor whatever it may be.
So I think getting in there,offering time, offering to do a

(01:02:45):
workshop one evening overtakeout, right, with a portfolio
company that's at a decisionpoint, that's huge.
And those founders all talk.
So the best signal for primary,right, is when there's scuttle
butt in the portfolio that'ssome advisor that we've
introduced people to, everyoneloves, right?
And even if I think about likein the go-to-market category,
how Jason Gelman got here.

(01:03:07):
There's a woman who's an amazingadvisor to primary, Tori Moss.
She had been at greenhouse for anumber of years.
She's at Pigment now.
I call Tori about the job.
And Tori was like, I'm reallyhappy.
She's still at Greenhouse thetime being.
She said, But I know you reallywell from doing this advisory
work.
There's one guy in New York whoyou need, and it's Jason Gelman,
right?
And that recommendation went avery, very long way to me.

(01:03:29):
And it also, like Jason Gellmanprobably wouldn't have taken my
call if it hadn't have come fromTori because he was perfectly
content in his job and compass.
And it took me a really longtime to get him out of there.
Right.
But that's a long way of saying,like everything is just this
like people talk and reputation,but you gotta do the work.
You're not just gonna like comein for an interview.

Certainly.
And obviously getting in throughthe VCs that you're correct.
Yeah.

And even like companies you've left.
So hopefully you left in goodstanding.
If you were an executive, right,you had board exposure.
If you didn't, I would say it'sa problem, right?
And you want to rethink that inthe current role.
But you could go back to themand think about who was the
series A investor at the lastcompany on the board and say,
hey, we haven't worked togetherin a little bit.
But if you have portfoliocompanies, I can help, right?

(01:04:12):
Go back the back in timemachine, right?
Of people who can be highleverage to you.

Great advice.
Yeah.
What company in the GTM spacethat's worth over a billion
dollars would you put that into?
So you can say, I'll put in uh,you know, a HubSpot or a
Salesforce or something likethat, Zoom Info, public company,
or private company that's valuedover a billion.
So you've had the you had the uhthe the companies somewhat of of
uh the 2020s that were in thosevaluations, maybe Gong and

(01:04:39):
Outreach type stuff.
And then you have the mostrecent ones, um, well, like
Apollo, Clay, you name it.

So I think Clay is pretty special.
Um that's one we didn't seebecause they have a longer
journey.
Kareem actually worked atSalefru when I was there um
through another aqua hire of hispast company.
And I think he's a very, veryspecial product leader who's
just going about things in aunique way.
They're also like a New YorkCity darling, but that's
probably my favorite one thatwe're watching from afar.

Awesome.
Yeah, that's a good one.
All right.
Uh second lightning roundquestion.
What are you doing or where areyou going to level up in the
role right now?
Who are you learning from?

Absolutely.
So I will tell you that this isthe first time in my career that
I legitimately feel old becauseI watch what's going on with AI
and people are like, you'recrazy.
Like, and so for me, I'm like, Ijust want to get better at AI
workflows all of the time.
So I look at other people aroundprimary and then I talk to
amazing operators that I know,right, around what they're doing

(01:05:40):
and just draw lessons from them.
I think the number one way thatI'm challenging myself is that
anytime I embark on a work passover the course of the day, I
stop and say, am I actuallystill fundamentally doing this
in the most effective way?
And I would tell you that eightout of 10 things I do per day, I
end up doing in a slightlydifferent way now.
And I know it's probably stillnot the most efficient way.
Um, but just to put a finerpoint on that, you know, um, we

(01:06:01):
haven't talked about this, but Irun this community for senior
women and software in particularcalled the on the business um
community, again, working on thebusiness versus working in the
business.
And a huge part of what we dowith that are AI show and tell,
right?
So I had like the head ofproduct at Ramp at the last
event to talk about what theywere doing.
And these women are all thankingme for bringing it together
around like self-ish.

(01:06:21):
Like, I'm benefiting from this,right?
Because I'm talking to all theseamazing executives at different
companies to understand whatthey're doing.
So I think about it as like it'sthe network is compound
interest.
And it's just talk to people whoyou think are really smart.
And you might not do it exactlythe same way they do, but it
instructs you to think aboutthings in a slightly different
way.

Last question.
Uh, if you weren't doing this,yeah, what would you be doing?

I would be a college professor.
Wow.
Yes.
Business school.
I business school.
I love teaching.
So I uh will tell you as afriend, I am an MBA.
I feel like sometimes you getlike really dirty look when you
say that.
Um, I might say I think I'm oneof the good ones.

SPEAKER_02 (01:07:01):
Yeah.

Uh, but I've actually gotten really involved.
I went to business school atDartmouth.
I do guest lecturing there.
I'm on the board of theInnovation and Entrepreneurship
Program at Duke, where I did myundergrad.
Um, I've done some guestlecturing at Columbia Business
School and I absolutely loveteaching.
It's been a passion project ofmine for a long time.
Back in 2011, I started thisreally popular class in New York
on Skillshare, on cohortanalysis.

(01:07:23):
And I joke that I've taught overlike 700 of like the version one
New York tech community peopleon cohort analysis, but you are
still doing it in Excel, youknow, in pivot tables.
Um, and so I it's been a passionof mine for a really long time.
And I'm finding ways to do itnow.
The on the business program Imentioned before is a huge
outlet, but I think it's likethe running jokeslash
understanding of my family thatthey all say, like I will never

(01:07:45):
ever retire, but that if I everdid something else, that's
probably what the next chapterwould be.

Excellent.
Skillshare is a throwback.

Skillshare is a major throwback, but I joke
there, like again, the role islong with network connections,
where I think about um, youknow, Dan Kazakowski, who was at
first mark for years and he'snow at Google.
Dan and I met because I taughtthe cohort analysis class and he
taught the sequel class.
And so we would like tradestudents on both sides.
And I'm like, it's just you younever know, right?

(01:08:13):
So play play the long game andall that you do is maybe my my
final parting thought.

Love it, love it.
Yeah, their CEO is probably oneof the few people in Silicon
Valley.
So harder pronounced last namethan I have.
So percent.
100%.
Uh with young, you don't have todeal with the problems that us
uh hard pronounce last peopledo.
Yeah.
All right, thank you so much.

Thanks for having me.
I'm not surprised that you havea another project that you've
taken on with the new podcast,but I appreciate you bringing me
on.

Yeah, you know, just trying to to provide more
exposure to our audience on allthings VC.
I mean, that that's probably thenumber one demand we get is just
like, hey, we want to learnabout how to be a VC, what it
takes to be VC, and um, youknow, how go to market, you
know, folds into that.
So we get a lot of that from ourLP base, but I think we get a
lot of it from our audience nowtoo.

(01:09:00):
So it's nice.
We're just in this weird kind ofum GTM but also VC thing.
Yeah.
So uh little a little unique, alittle different.
Awesome.
Well, can't wait to listen tomore.
That was another fantasticepisode of the VC series on the
GTM Dow podcast.
Head over to Apple, Spotify, orYouTube.
Give us a like and subscribe.
Well, we'll see you on the next.

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