Jay Levy is the co-founder and partner at Zelkova Ventures, an early-stage venture capital firm with over 17 years of experience backing transformative SaaS companies like Help Scout, Klout, and Crimson Hexagon. From designing websites in high school to scaling startups during the dot-com boom, Jay has lived the full founder-to-investor journey. With a disciplined, people-first approach to investing, he offers sharp insights on scaling efficiently, founder self-awareness, and how AI is reshaping the venture landscape.
In this episode, he discusses how to identify the right founders, lessons from startup failures, valuation discipline, and why the VC industry may need to reinvent itself in the AI era.
In Today’s Episode We Discuss:
00:01 – Welcome & Jay Levy Introduction
00:44 – Early days: building websites in high school
02:02 – Recurring revenue lessons from hosting clients
02:30 – First big project: city youth website gains national attention
03:55 – Joining Uconnections during the dot-com boom
04:48 – Startup collapse and lessons from scaling too fast
06:14 – Transition to Morgan Stanley and corporate reality check
07:15 – Leaving Wall Street for entrepreneurship
08:14 – Early days of New York’s tech scene
09:08 – Founding Zelkova Ventures and initial clean tech focus
10:46 – Lessons from Uconnections and the importance of pacing growth
12:43 – Finding a sustainable revenue model early
14:23 – How Zelkova’s investment thesis evolved
16:45 – The importance of valuation discipline
18:43 – Easy “no” deals and founder self-awareness
20:24 – Assessing the “ego-to-ability” ratio
21:23 – The three types of investors founders meet
23:37 – Avoiding investor-founder misalignment
24:47 – Zelkova’s check size and barbell investment approach
26:29 – Reserve strategy and follow-on investments
27:24 – Board observer seats vs. board member roles
29:15 – Managing multiple board observer roles
30:54 – How AI is reshaping product development costs
33:12 – From MVP to “Pretty Good Viable Product” with AI
34:41 – Building companies more efficiently with AI tools
36:10 – Could AI reduce the need for early-stage VC?
38:36 – Platforms, scalability, and AI’s “last mile” problem
40:29 – The shift toward AI-powered business operations
41:42 – Early-stage investment focus areas today
46:26 – In-person vs. remote-first startups
48:13 – Patterns of the best founders Jay has backed
50:58 – Where promising founders fall short
52:38 – The early-stage metrics that actually matter
54:58 – Why CAC and early-stage NPS are overrated
56:11 – Underappreciated metrics: qualitative customer feedback
57:57 – A company Jay passed on but still thinks about
59:11 – When valuation discipline pays off (and when it doesn’t)
01:01:13 – Being both a GP and LP in the venture world
01:03:00 – Later-stage investments for faster liquidity
01:05:41 – Thoughts on SAFEs, convertible notes, and doing it right
01:09:00 – Closing thoughts and where to connect with Jay Levy
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