OM DENNE EPISODE
This week on Swimming with Allocators, Earnest and Alexa welcome Kelli Fontaine of Cendana Capital, as she traces her path from journalism to data-driven venture investing and explains how her obsession with finding the truth shapes her work as an LP. She breaks down how Cendana builds and uses its data systems, why early-stage power laws and portfolio construction matter more than headline TVPIs, and how she balances hard data with judgment about GPs. Kelli challenges the idea that pre-seed always outperforms seed, shares why fund I and II managers are uniquely compelling, and explores trends like concentrated portfolios, deep tech, defense tech, AI-native founders, and secondaries. Also, Sidley emerging companies lawyer Michael Podolny explains that rapid growth and complexity in AI-driven startups are driving demand for globally sophisticated legal advice from day one, with a particular focus on repeat founders, control, and tax optimization through QSBS planning.
Highlights from this week’s conversation include:
Kelli’s Journalism Roots and Early Fascination with Data (0:29)
Moving from Finance to Tech and Startups at RPX (2:42)
Building Data Infrastructure and Dashboards at Sandana (7:07)
What People Mean by the “Sandana Model” and Relationship Focus (10:31)
Why Funds Ones and Twos Are Special and How GPs Evolve Over Time (15:09)
Why Late-Stage AI and Mega Rounds Don’t Replace Early Stage Alpha (19:30)
Sponsor Segment: Sidley’s Work With AI and Sophisticated Startups (21:16)
Tax Optimization and QSBS Considerations for Founders and Investors (24:49)
KPIs That Matter: Revenue, Customer Quality, and Go-To-Market (28:40)
How Changing Graduation Rates Affect Fund One and Fund Two Diligence (30:24)
How to Think About Founder Secondaries vs GP Secondaries (34:54)
Portfolio Management, Write-Offs, and the Real Role of Acqui-Hires (37:13)
Treating Venture Like Public and Private Equity Segments (Small vs Mega) (40:05)
Frustrations With AI Hype, FOMO, and Public Perception of Tech (43:50)
Closing Remarks and Reflections on Macro Conversation (45:39)
Cendana Capital is a venture fund-of-funds focused on investing in seed-stage venture capital firms and partnering with managers at the earliest stages of company formation. The firm is one of the most active LPs dedicated to the seed ecosystem, with a focus on identifying and supporting differentiated early-stage venture managers. Learn more at www.cendanacapital.com.
Sidley Austin LLP is a premier global law firm with a dedicated Venture Funds practice, advising top venture capital firms, institutional investors, and private equity sponsors on fund formation, investment structuring, and regulatory compliance. With deep expertise across private markets, Sidley provides strategic legal counsel to help funds scale effectively. Learn more at sidley.com.
Swimming with Allocators is a podcast that dives into the intriguing world of Venture Capital from an LP (Limited Partner) perspective. Hosts Alexa Binns and Earnest Sweat are seasoned professionals who have donned various hats in the VC ecosystem. Each episode, we explore where the future opportunities lie in the VC landscape with insights from top LPs on their investment strategies and industry experts shedding light on emerging trends and technologies.
The information provided on this podcast does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this podcast are for general informational purposes only.
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