WEBVTT
00:00.211 --> 00:03.878
[SPEAKER_01]: Hello everyone, welcome to next level humanity podcast.
00:04.118 --> 00:06.763
[SPEAKER_01]: I have deers, Marcos Fernandez here.
00:06.863 --> 00:07.985
[SPEAKER_01]: Hi, Marcos are you.
00:08.860 --> 00:10.921
[SPEAKER_00]: I'm good, and I thank so much for having me on today.
00:11.001 --> 00:12.582
[SPEAKER_01]: And well, thanks for being here.
00:13.102 --> 00:19.444
[SPEAKER_01]: And our theme today is, trust time and the architecture of capital in financial systems.
00:20.345 --> 00:23.786
[SPEAKER_01]: Marcos is the founder of Fiat Ventures.
00:24.286 --> 00:26.747
[SPEAKER_01]: He lives in San Francisco Bay, area.
00:27.948 --> 00:30.869
[SPEAKER_01]: And you have been in the venture world for how long?
00:32.305 --> 00:39.511
[SPEAKER_00]: So we've had this fun for about five years, but I did a lot of cork-dev investing in angel investing for a good part of the last 15.
00:39.571 --> 00:42.153
[SPEAKER_00]: So a few cycles in a few different roles.
00:42.794 --> 00:43.394
[SPEAKER_01]: Yeah, great.
00:43.674 --> 00:48.999
[SPEAKER_01]: And you spent your career around financial systems, FinTech, capital formation.
00:49.619 --> 00:56.405
[SPEAKER_01]: When did investing stop being about transactions and start being a way you interpret the world?
00:56.945 --> 01:00.028
[SPEAKER_01]: And when did you decide on helping founders
01:01.324 --> 01:04.426
[SPEAKER_01]: helping innovative ideas shape the world basically.
01:05.507 --> 01:10.810
[SPEAKER_00]: Yeah, I'd actually say it started on the founders and ideas in the advising long before the capital.
01:11.210 --> 01:15.033
[SPEAKER_00]: Was there partly that was because you know you're building your own capital when you're younger and
01:15.891 --> 01:39.233
[SPEAKER_00]: You know, I went to grad school at UT and in Austin, and that was one of my first introductions to the robust world of startups and ecosystems, and yeah, your personal cash flow as a grad student is different than after you graduate, but what I found is that one of my favorite things to do was to go get a coffee or lunch with a founder, and the best part of those meetings is when the founder says, hold on, and pulls out a note pad and starts taking down notes, because like,
01:39.893 --> 01:58.193
[SPEAKER_00]: up until that point you know you're entertaining ideas but when someone is willing to pull out something to really take a note that's when you know you're you're striking a chord and so they really started as a lot of that and then as you know I was able to you know make more money it was small angel checks and a lot of that was more of I'm working with founders outside of my day job
01:58.994 --> 02:06.499
[SPEAKER_00]: And I'd get really excited about what they're building and they, you know, are allowing me to be able to participate in these rounds, which is really, you know, really cool.
02:06.560 --> 02:13.925
[SPEAKER_00]: And that's no balled into a little bit larger angel checks and in larger corp dev, you know, and you mentioned FinTech.
02:13.965 --> 02:16.647
[SPEAKER_00]: I started my FinTech career at so far in the
02:17.207 --> 02:36.161
[SPEAKER_00]: student lending space, we can happen to dive in more and then I went over to Ripple in the digital asset and crosswater payment space, whereas able to take on a lot of business development partnerships and corporate development roles, so starting to write more checks, but to your point, like it's not about the exchange of capital, like that's way too transactional.
02:36.341 --> 02:41.825
[SPEAKER_00]: It's about backing these phenomenal founders who are dedicating their lives to solving really key issues.
02:42.505 --> 02:54.573
[SPEAKER_00]: And the way that we see it is it's not just about solving issues to make money, but it's filling gaps in the world around us and we can kind of dive in more, but if it's just capital then it's just to transactional.
02:54.633 --> 03:03.880
[SPEAKER_00]: It's really finding folks who you can put everything behind and for us it's more than just capital with what we can bring to the table as part of Fiat Ventures in Fiat Growth.
03:03.920 --> 03:05.421
[SPEAKER_00]: But again, I'll pause there.
03:05.441 --> 03:06.682
[SPEAKER_00]: There's a ton more that we can dive into.
03:06.702 --> 03:07.182
[SPEAKER_01]: Yes, sure.
03:07.402 --> 03:11.365
[SPEAKER_01]: No, I mean, I'm wondering what really experiences shaped your understanding of
03:12.921 --> 03:20.865
[SPEAKER_01]: You know, trust and all the financial systems and, you know, where does this appetite for helping founders coming from?
03:21.585 --> 03:22.045
[SPEAKER_01]: Come for me.
03:22.165 --> 03:22.546
[SPEAKER_00]: Yeah.
03:23.146 --> 03:26.928
[SPEAKER_00]: I mean, a lot of just helping people in general is rooted in my upbringing.
03:26.988 --> 03:36.332
[SPEAKER_00]: So, you know, both my parents are from Mexico, I grew up in El Paso, Texas, wonderful community and my parents have done, you know, very, very well for themselves, given their backgrounds.
03:37.117 --> 03:41.899
[SPEAKER_00]: But in a place like Al Paso and you know the 90s, there's just not a ton of capital around.
03:41.939 --> 03:45.980
[SPEAKER_00]: So people aren't judging each other based on where do you work or where do you drive or where do you live?
03:46.020 --> 03:48.961
[SPEAKER_00]: It's much more based on your character and how you hold yourself.
03:49.041 --> 03:56.064
[SPEAKER_00]: And you also, you know, we spent a lot of time close with the church that I grew up in in different groups of just giving back and finding that.
03:56.104 --> 04:01.625
[SPEAKER_00]: So I gave credit to my parents of this like strong DNA of like leave this world a better place than when you found it.
04:02.246 --> 04:05.947
[SPEAKER_00]: And no matter how tough of a situation or in there's always ways that you can help others.
04:06.447 --> 04:17.896
[SPEAKER_00]: And so that's kind of part, and I'm very fortunate to have co-founders and partners who feel the same that for us with financial technology, we're proponents that you can do good and do well and not have to sacrifice returns for doing that.
04:17.976 --> 04:22.299
[SPEAKER_00]: That's not something that you have to do and give up on the alpha of it.
04:22.319 --> 04:26.703
[SPEAKER_00]: You're actually filling gaps and solving these real core problems for large swaths of people.
04:27.623 --> 04:37.574
[SPEAKER_00]: And so that as now we invest like it, that's a core value and the example that I get people right is as venture investors were trying to invest in a world five to 10 years from today.
04:38.194 --> 04:40.277
[SPEAKER_00]: That world is naturally more homogeneous.
04:40.417 --> 04:45.622
[SPEAKER_00]: There's more access to different services within financial services both here and across the world.
04:46.483 --> 04:47.925
[SPEAKER_00]: you know, there's a huge gaps.
04:48.005 --> 04:52.349
[SPEAKER_00]: There's, you know, hundreds of millions of people globally who are either under baker unbanked.
04:52.849 --> 04:55.492
[SPEAKER_00]: And basic access to services is not available.
04:55.532 --> 04:59.876
[SPEAKER_00]: And so what we look for, our founders who understand those problems are building solutions for them.
05:00.257 --> 05:04.681
[SPEAKER_00]: The net results is better financial access for, again, hundreds of millions of people globally.
05:05.162 --> 05:09.466
[SPEAKER_00]: And then you can build sustainable, profitable businesses based on the, the backbones of that.
05:09.666 --> 05:09.866
[SPEAKER_00]: So,
05:10.627 --> 05:22.135
[SPEAKER_00]: Again, kind of a long answer for a simple question, but some of it is for my upbringing in, you know, having a deep connection with, you know, doing good and doing well and then also having seen it as operators, we know that that model works.
05:23.697 --> 05:33.824
[SPEAKER_01]: Yeah, and before you become an investor, what values did you have already, you know, guiding you, is it like helping people, helping ideas and what else?
05:35.316 --> 05:39.879
[SPEAKER_00]: Yeah, I think a lot of it, and again, like credit to my parents is around selflessness.
05:39.899 --> 05:42.962
[SPEAKER_00]: So like my dad used to teach me this and I have a three and a five year old now.
05:42.982 --> 05:50.167
[SPEAKER_00]: So I'm trying to instill as many values as you can, but do something every day to help someone else out that no one else knows about.
05:50.347 --> 06:01.495
[SPEAKER_00]: So oftentimes today, you hear about these these things and oftentimes it's for brand building, but making it a habit in your daily life to just do something for someone and it doesn't have to be monumental from holding open a door to like,
06:01.995 --> 06:20.603
[SPEAKER_00]: buying some of that sandwich like it's doing these things that you can constantly doing in that selflessness even for our founders like we we need to know the role that we play there's often this unique tension between founders and investors and I get it because we two have investors and that dynamic is at play but I try to let our founders know that we work for them
06:21.363 --> 06:27.808
[SPEAKER_00]: Our job is to enable them to be better, not just through our capital, but through our network, through our operational experience, through our consultancy.
06:28.328 --> 06:32.211
[SPEAKER_00]: And so a lot, again, a lot of it is like, it's not a zero-sum game.
06:32.371 --> 06:33.732
[SPEAKER_00]: There's room for all of us to win.
06:34.312 --> 06:40.237
[SPEAKER_00]: And again, I'm lucky to have, you know, my two partners, Drew and Alex, who feel the exact same and have seen that come to fruition.
06:40.317 --> 06:40.517
[SPEAKER_00]: So,
06:40.957 --> 06:44.739
[SPEAKER_00]: We're kind of more of like, especially in venture, you can get the sharp elbows type principles.
06:44.779 --> 06:57.565
[SPEAKER_00]: We're more of a rising tide and trying to build a big ecosystem and lift people up with us and we are huge proponents that will serve us better in the long run than, you know, trying to, you know, catch edges and take advantage of founders or situations.
06:58.505 --> 07:04.868
[SPEAKER_01]: Yeah, I think building communities work amazing in the long, long term, the long run.
07:05.568 --> 07:06.649
[SPEAKER_01]: I have some
07:07.180 --> 07:30.032
[SPEAKER_01]: other VC friends who are also building their own communities and as the community builds it's not only about getting the funding but it's building our community around you that can help the companies you choose to help with the founders you choose to help and when we come back to FinTech, FinTech sits at the intersection of regulation, technology and human
07:37.965 --> 07:54.172
[SPEAKER_00]: Yeah, you bring up a good point of it sits at the centers, particularly psychology, right, where you're highly regulated and there's there's important protections in place, but also finances is one of the more personal things that individuals can think about.
07:54.292 --> 07:54.352
[SPEAKER_00]: And
07:55.192 --> 08:09.762
[SPEAKER_00]: And often times not in a positive light, you know, it's something that is, unfortunately, impacts a lot of people again globally, but certainly in the US, not in the most positive cadences, you know, some of the statistics around the lack of having savings, accounts, or lack of access.
08:10.283 --> 08:14.306
[SPEAKER_00]: And so there is almost a psychological barrier to become more comfortable with that.
08:15.086 --> 08:19.649
[SPEAKER_00]: And what we've seen really over the last ways, right, is the last, you know, call it FinTech evolution.
08:19.849 --> 08:24.072
[SPEAKER_00]: This is the, the so-fires, the times, the Robin Hoods, the betterments and wealth fronts.
08:24.532 --> 08:30.376
[SPEAKER_00]: But it took where physical brick and mortar stores and allowed you to digitize that, you know, largely through smartphones.
08:30.416 --> 08:31.997
[SPEAKER_00]: So now you have a bank in your pocket.
08:32.577 --> 08:42.142
[SPEAKER_00]: What we're starting to see now is consumers aren't just more comfortable doing financial services through these digital platforms, but they're also comfortable doing that with non-financial institutions.
08:42.662 --> 08:47.284
[SPEAKER_00]: So what I mean by that is, you know, Apple Pay and Google, they're now becoming some of the largest fintechs.
08:47.344 --> 08:48.845
[SPEAKER_00]: You see this with Shopify, right?
08:48.925 --> 08:53.107
[SPEAKER_00]: They have Shopify capital, which is now a big substantial part of their business.
08:53.167 --> 08:58.930
[SPEAKER_00]: And same with like Starbucks, the rewards program is one of the most successful fintech rewards platforms that have been launched.
09:00.030 --> 09:17.353
[SPEAKER_00]: You're starting to see that proliferation with brands that people trust almost lowered the psychological barriers because it feels less like I'm walking into to use it in a positive example, their investors are like a bank of America building that you know has these big pillars and you're walking up to someone at a window.
09:17.753 --> 09:23.574
[SPEAKER_00]: Now you can get exposure its ways to save, to better spend, to better manage your capital through much more user-friendly platforms.
09:23.634 --> 09:25.934
[SPEAKER_00]: And so that's a healthy thing because you're
09:29.695 --> 09:36.517
[SPEAKER_00]: In addition to that, you've seen the emergence of a lot of what you call like banking as a service or fintech platforms that allow you to launch products more easily.
09:37.398 --> 09:48.942
[SPEAKER_00]: What that means is more competition, which is not necessarily good for us and for our founders, but it's good for consumers because that means now that you have access to a whole bunch of different types of financial services through all these different platforms.
09:49.002 --> 09:56.124
[SPEAKER_00]: And so I think you're seeing it move in a very positive way where the abundance of options coupled with the familiarity, digital adoption,
09:56.704 --> 10:06.357
[SPEAKER_00]: and doing that with not necessarily large financial institutions is creating a really positive outcome ultimately for the end consumers who just need better access.
10:08.553 --> 10:17.997
[SPEAKER_01]: and after years of evaluating founders and markets where are you today like what do you trust today and how do you decide today?
10:18.037 --> 10:30.944
[SPEAKER_01]: Do you decide with data, with narratives, with maybe you have some pattern recognition, how do you decide and what kind of founders and projects are you or no compelled to back?
10:32.549 --> 10:35.050
[SPEAKER_00]: Yeah, definitely, it's an art and a science, right?
10:35.130 --> 10:41.251
[SPEAKER_00]: Like, there's not a clear, I wish there is a way that you could very clearly say this equals this equals that.
10:42.171 --> 10:47.452
[SPEAKER_00]: You know, for us, our model gives us a little bit of a unique advantage, so, you know, quick, quick overview.
10:48.012 --> 10:52.233
[SPEAKER_00]: Our venture arm certainly is a robust part of our business, but we also have a growth consultancy.
10:52.273 --> 10:56.754
[SPEAKER_00]: And this consultancy works with anywhere from 25 to 35 companies at any given time.
10:57.274 --> 11:01.538
[SPEAKER_00]: We've now worked with over 300 companies over the last seven years, and that's across stages.
11:01.558 --> 11:13.589
[SPEAKER_00]: That's pre-seed stage all the way to Fortune 100 companies, and what that does for us is it eloss us the ability to see what's going on across stages and across sectors to make better decisions around where we want to invest.
11:14.269 --> 11:37.668
[SPEAKER_00]: So for us, it almost creates a wake, this information, and this data cemetery to then allow us to make the best investments behind it, and to also attract great founders to the ecosystem because kind of back to we're not just providing capital and introductions, but we can be a hands-on participant in the growth of their organization, which is really rare and gives us a really good opportunity to help them build.
11:38.589 --> 11:40.891
[SPEAKER_00]: So with all that, yeah, there's a ton of data, right?
11:40.911 --> 11:42.793
[SPEAKER_00]: We're aggregating that across what we're seeing.
11:42.853 --> 11:44.834
[SPEAKER_00]: We're seeing a lot of trends.
11:44.854 --> 11:46.476
[SPEAKER_00]: We define our own trend reports.
11:46.496 --> 11:54.762
[SPEAKER_00]: We're actually getting ready to publish that at the beginning of March, annually, where we talk about what are the 10 to 12 things that are getting us the most excited, based on what we're seeing in market.
11:55.983 --> 12:03.669
[SPEAKER_00]: But then also, you know, the art of it, right, is especially because we're primarily investing at the seed stage, which is still very early.
12:04.610 --> 12:05.631
[SPEAKER_00]: You are backing founders.
12:05.651 --> 12:06.592
[SPEAKER_00]: You are backing people.
12:06.692 --> 12:11.015
[SPEAKER_00]: And at the end of the day, that is the number one reason why companies succeed or fail.
12:11.456 --> 12:13.978
[SPEAKER_00]: Ideas are important, but they can become commoditized.
12:14.078 --> 12:16.239
[SPEAKER_00]: Markets are very important, but they can shift.
12:16.880 --> 12:17.881
[SPEAKER_00]: Products change.
12:18.441 --> 12:19.762
[SPEAKER_00]: You know, there's so many examples.
12:19.822 --> 12:23.025
[SPEAKER_00]: And so what we really go towards then is founder, right?
12:23.125 --> 12:25.026
[SPEAKER_00]: And there's a couple ways we evaluate that.
12:25.947 --> 12:29.690
[SPEAKER_00]: One, it's not a term that only we use, but we use it as a founder market fit.
12:29.870 --> 12:37.877
[SPEAKER_00]: So what is your unique background that gives you perspective to this problem that you're solving, that then lets you kind of outwork everyone else.
12:38.057 --> 12:41.379
[SPEAKER_00]: We like to see velocity, so how quickly can you in the team ship product?
12:41.580 --> 12:44.342
[SPEAKER_00]: That means you'll have the ability to move quickly within those markets.
12:45.463 --> 13:01.457
[SPEAKER_00]: You know, we look at a lot of co-founder dynamics, you know, how did you meet, how long have you been working together, the number one reason why startups fail are from that, so we spend a little bit of psychological right of like what motivates you to build this and to dedicate your life towards this and, you know, at the end of the day we're ultimately, you know,
13:02.118 --> 13:28.753
[SPEAKER_00]: creating a partnership because we're again we're back in with capital but we're also providing a lot of time in services and vice versa those founders are now making us a part of that journey especially for leading around we're on the boards we've got governance and in in oversight and so it's important for them to to evaluate us just as much as we're evaluating them because at the end of the day it's a it's a two-way street or the best relationships so yeah another long answer for you so it's it's it's a lot of different things but founder
13:30.927 --> 13:46.783
[SPEAKER_01]: Yeah, and you also look for like self mastery of the founder, do you like it because my background is as you know, we have a lot of sciences and I'm always wondering like does the VCs see the self mastery potential like are they.
13:47.613 --> 14:02.945
[SPEAKER_01]: able to govern, you know, most areas in their lives, because when you, I think in Western Sea, that preceded that the characteristic traits of the founder are also important, like thus he or she,
14:04.214 --> 14:06.715
[SPEAKER_01]: That's, you know, do they do what they say?
14:06.735 --> 14:10.136
[SPEAKER_01]: Is she or he, someone who walks her talk?
14:10.716 --> 14:12.817
[SPEAKER_01]: So those are, like, also really important.
14:12.857 --> 14:15.558
[SPEAKER_01]: Maybe being open about things.
14:16.018 --> 14:20.900
[SPEAKER_01]: I mean, I can imagine, as we see, you want them to be open when things go get challenging as well.
14:21.040 --> 14:25.882
[SPEAKER_01]: You know, you don't want to hear only the things that go well, but also the things that go wrong.
14:26.282 --> 14:28.543
[SPEAKER_01]: But if they have, they have kind of like some,
14:28.943 --> 14:46.131
[SPEAKER_01]: I don't know, confidence issues or some, you know, other issues with themselves where they can have the potential to hide things, you know, things might go wrong or if they are having, you know, a hard time executing, they're having a hard time, you know, governing.
14:52.774 --> 15:04.677
[SPEAKER_01]: founders that are masters and that have the ability to govern and execute and the others that are not like what are the patterns you recognize?
15:05.897 --> 15:09.878
[SPEAKER_00]: Yeah, I'm glad you brought it up because it's not just an important thing.
15:09.898 --> 15:12.599
[SPEAKER_00]: It might be one of the if not the most important thing, right?
15:13.219 --> 15:15.359
[SPEAKER_00]: And it's one of the most hardest things to evaluate, right?
15:15.379 --> 15:21.801
[SPEAKER_00]: Because if you're a founder and you know, I get it too because I'm out there, you know, talking to people about our own venture capital fund
15:23.282 --> 15:40.737
[SPEAKER_00]: You're going out there and you're talking to hundreds of people, whether it's for capital raising or for hiring or for sales, and so it's easy to get into this routine, so as an evaluator of those characteristics, it's really difficult over Zoom or even in-person meetings to get a deep sense of, ultimately, I think of them as a trust.
15:41.358 --> 15:48.865
[SPEAKER_00]: Are you someone who trusts me, can I trust you, and not just to be stores of capital, but to be able to deliver on the promises that we're making each other?
15:49.665 --> 15:53.190
[SPEAKER_00]: and knowing that sometimes that's not always going to be great.
15:53.310 --> 15:56.534
[SPEAKER_00]: Like in any relationship, there will be speed bumps, there will be major hurdles.
15:56.995 --> 15:59.258
[SPEAKER_00]: I just want to know that you have my best interest in mining.
15:59.278 --> 16:01.120
[SPEAKER_00]: You know those best interests and vice versa.
16:01.500 --> 16:06.947
[SPEAKER_00]: I really try to understand what are the core things that you're trying to do so that I can take care of you along this journey as well.
16:07.868 --> 16:19.411
[SPEAKER_00]: It's a tough thing because again, the role that we play for leading around is we have to have the best interests of all the investors who pre-passed and current until we hand that torch in a future around and someone else takes on that responsibility.
16:19.931 --> 16:25.272
[SPEAKER_00]: So while we want to be very found or friendly, we also have to be very clear from a liability and governance perspective.
16:25.672 --> 16:30.253
[SPEAKER_00]: We have to ultimately ask questions on behalf of everyone who is on the cap table and
16:30.733 --> 16:37.096
[SPEAKER_00]: Again, as a founder, it's your responsibility to know that once you take on capital, that you are fiduciary of that, of that money, right?
16:37.216 --> 16:40.677
[SPEAKER_00]: It's not just, you know, fun and now you've got institutional backers.
16:40.697 --> 16:42.438
[SPEAKER_00]: There's there's a responsibility element.
16:42.478 --> 16:44.318
[SPEAKER_00]: So, yeah, it's your question.
16:44.999 --> 16:49.500
[SPEAKER_00]: It's, it's really difficult even when you think you know people sometimes certain characters succeed come out.
16:49.941 --> 16:51.761
[SPEAKER_00]: The other reality is nobody's perfect, right?
16:51.781 --> 16:52.542
[SPEAKER_00]: Like we're all human.
16:52.562 --> 16:55.303
[SPEAKER_00]: There's, there's not like the perfect someone that's figured it out.
16:55.903 --> 16:58.144
[SPEAKER_00]: So, so what we try to instill is, um,
16:59.068 --> 17:03.671
[SPEAKER_00]: You know, trust up front, I am always very direct and transparent throughout the process.
17:03.731 --> 17:04.491
[SPEAKER_00]: This is where you are.
17:04.511 --> 17:05.712
[SPEAKER_00]: Do you have any questions for me?
17:05.752 --> 17:08.654
[SPEAKER_00]: Like, just I don't want there to be any surprises at any point.
17:08.694 --> 17:12.316
[SPEAKER_00]: And I certainly don't want people to think that we're trying to hide anything because we're truly not.
17:12.336 --> 17:15.598
[SPEAKER_00]: We're trying to put together this, this, this partnerships together.
17:16.738 --> 17:24.344
[SPEAKER_00]: The other thing that for us that we're fortunate with is, in a lot of cases, some of the founders that we back are people who we've worked with for the patch, right?
17:24.384 --> 17:31.989
[SPEAKER_00]: So I mentioned this 300 plus companies in our, our ecosystem, some of the best investments that we've made are with founders that we've actually been working with for.
17:32.830 --> 17:34.350
[SPEAKER_00]: three, five, seven, eight years.
17:34.370 --> 17:42.913
[SPEAKER_00]: We've known them since we're in operating roles and and that is a huge advantage because you don't need to underwrite that as much because you've seen them in the trenches.
17:42.953 --> 17:47.034
[SPEAKER_00]: You know how they respond in tough situations and you can judge their character a lot more easily.
17:47.574 --> 17:50.695
[SPEAKER_00]: Vice versa for us, you know, they've seen how we operate.
17:50.735 --> 17:51.836
[SPEAKER_00]: They've seen us as operators.
17:51.856 --> 17:55.857
[SPEAKER_00]: They've seen what we're doing now and so that helps build trust on their side because they also understand that
17:56.617 --> 18:03.289
[SPEAKER_00]: We're not just trying to sell a game and then we like close a deal and then we're gone like there there are things that we intend on delivering on our side so
18:04.225 --> 18:05.526
[SPEAKER_00]: Yeah, it's it's a tough one.
18:05.546 --> 18:12.452
[SPEAKER_00]: There's no short answer for it, but it just takes time and in the best investments are those that we've been able to cultivate relationships with historically.
18:12.612 --> 18:13.593
[SPEAKER_01]: Yeah, storytelling.
18:13.613 --> 18:14.894
[SPEAKER_01]: Yeah, I can imagine.
18:15.514 --> 18:26.684
[SPEAKER_01]: And what do you think is the main mistake, other investors make when they underestimate the complexity of financial infrastructure?
18:27.565 --> 18:30.387
[SPEAKER_01]: What are the mistakes done in the investment war?
18:32.126 --> 18:46.807
[SPEAKER_00]: Yeah, specifically in our sector and I think any sector there's what you call like hype chasing right so there's like something big a sector people realize it's a big thing and what happens in that is people just know they want exposure to that sector.
18:47.428 --> 18:55.513
[SPEAKER_00]: The hardest part in venture is not just guessing what's going to work within an industry or market, but you also have to back the best team to do it.
18:55.734 --> 18:58.776
[SPEAKER_00]: And depending on where you're at, it's not always multiple winters.
18:58.796 --> 19:00.337
[SPEAKER_00]: There's like one within a category.
19:00.357 --> 19:03.639
[SPEAKER_00]: So that's, I think what you can see then is that certain trends arise.
19:04.079 --> 19:10.603
[SPEAKER_00]: Certainly, we're in a lot of an excitement around AI right now across a whole bunch of different sectors, which I'm happy to dive into.
19:10.703 --> 19:14.106
[SPEAKER_00]: There's a lot of validity behind that excitement, but also there's a lot of hype chasing.
19:14.786 --> 19:34.215
[SPEAKER_00]: and so that's what you need to be careful the most is not just getting exposure to a sector because you feel like you need it and here's a founder that can solve it but being patient enough to wait for the right opportunity even if that means you miss a certain sector and exposure and so yeah for for us the way that we approach that as we come up with these themes and thesises but ultimately we are backing founders.
19:35.015 --> 19:47.838
[SPEAKER_00]: So, you know, at the end of the day, if a founder comes and they're teaching us about something and it's opening our eyes up to something, that is a much higher likelihood of path to success than here's a company that falls within one of our main decent areas.
19:57.453 --> 19:59.635
[SPEAKER_01]: Yeah, great, great, great answer.
20:00.816 --> 20:02.657
[SPEAKER_01]: Yeah, I, I, it's hard.
20:03.238 --> 20:05.479
[SPEAKER_01]: Yeah, chasing the hype might not work always.
20:05.579 --> 20:12.905
[SPEAKER_01]: And where are we around the world in between AI and Fintech?
20:14.646 --> 20:16.248
[SPEAKER_00]: Yeah, it's interesting, right?
20:16.348 --> 20:19.530
[SPEAKER_00]: You know, on AI in general, and then I'll dive into finance.
20:19.771 --> 20:26.135
[SPEAKER_00]: I think we're at a moment, a positive one where we understand the implications of AI across software
20:27.360 --> 20:33.487
[SPEAKER_00]: And that's important, but we are also at a moment where you haven't necessarily seen the full commercialization of that and the way that we know it can happen.
20:34.008 --> 20:48.644
[SPEAKER_00]: And the example that I like to use is like, when the iPhones first came out, we knew that there is something powerful happening in the way that we communicate and can reach people, but we didn't know that, you know, that would open up a cadence where we're getting into strangers cars to go stay at a stranger's house, but, you know,
20:48.944 --> 20:51.367
[SPEAKER_00]: Now, it's weird if you don't use Uber and Airbnb, right?
20:51.407 --> 21:03.318
[SPEAKER_00]: Like so, so we're kind of at the stage where we understand that something big is happening and there's all these projections for what it can be, but we're not quite to the commercialization at mass that we need for it to be, but we will get there.
21:03.538 --> 21:07.902
[SPEAKER_00]: And so there's this almost like this in-between and historically, you know, we have been
21:08.903 --> 21:14.825
[SPEAKER_00]: We, I guess humans have been often underestimated the time it takes to get that broad adoption.
21:15.045 --> 21:15.385
[SPEAKER_00]: I'm sorry.
21:16.246 --> 21:21.027
[SPEAKER_00]: Yeah, underestimate it, but then also don't have a realization of how big those implications are over time.
21:21.788 --> 21:25.729
[SPEAKER_00]: And so, within financial services, particularly it's a little bit different.
21:25.749 --> 21:34.692
[SPEAKER_00]: You mentioned this earlier, but you have high degrees of regulation around personally identifiable information, PI, different structures are typically a little bit more
21:37.693 --> 21:47.358
[SPEAKER_00]: it's their place, and then certainly consumer protections are in place for the right reasons to make sure that anything this launch has positive impacts.
21:47.538 --> 21:55.663
[SPEAKER_00]: That's a whole different podcast on some of the trends that you see certainly around like gaming, gambling, but not that we want to make sure people are in a better position.
21:56.443 --> 22:03.247
[SPEAKER_00]: When it comes to AI, we're seeing a lot of really great applications, and it's not necessarily like the way that we interact with the iPhone.
22:03.327 --> 22:10.210
[SPEAKER_00]: But it's in these really archaic spaces within traditional financial services that just have never been digitized.
22:10.551 --> 22:11.711
[SPEAKER_00]: And now you can start to build.
22:11.951 --> 22:14.873
[SPEAKER_00]: I'll give a couple examples within health care and payments.
22:15.373 --> 22:16.674
[SPEAKER_00]: and processing and coding.
22:17.014 --> 22:29.183
[SPEAKER_00]: We've made a few investments in some really phenomenal founders where it's helping you whether it comes to social work or understanding as an individual, what you should not just enroll in, but how to get rebates back, what you do there.
22:29.863 --> 22:39.370
[SPEAKER_00]: Billing, solving those core issues that lead to this incredible reconciliation process that is really hard for individuals, especially in outpatient clinics and especially mental health services.
22:40.050 --> 22:53.117
[SPEAKER_00]: So you're seeing really good applications, another one that we're just closing on within the insurance space, really boring stuff, but like mid-market brokers and MGA's and PNC coverage, that are just used to having to spend eight hours to buy and to draft the policy.
22:53.137 --> 23:00.981
[SPEAKER_00]: You cannot do that in like eight seconds, just integrating to all these different systems on their APIs and creating an agent like environment to just make it easier.
23:01.001 --> 23:02.822
[SPEAKER_00]: And people love it because,
23:03.682 --> 23:07.765
[SPEAKER_00]: what we look for are not customers who are looking for AI exposure to say they're using it.
23:08.146 --> 23:11.048
[SPEAKER_00]: We're looking for customers who don't really care what's being used.
23:11.088 --> 23:13.970
[SPEAKER_00]: They just know it's a 20 x improvement on whatever they're doing today.
23:14.711 --> 23:24.919
[SPEAKER_00]: And so when you think about that in AI, I get really excited because out of all the industries, because of everything that I mentioned, the legacy infrastructure, the regulations, it's one of the oldest to change.
23:25.459 --> 23:31.504
[SPEAKER_00]: But it's also one that is just ripe with all these processes that are very replicable to help make it easier.
23:31.784 --> 23:32.105
[SPEAKER_00]: And so
23:32.665 --> 23:34.125
[SPEAKER_00]: Yeah, I get excited now.
23:34.145 --> 23:43.708
[SPEAKER_00]: There is a lot of hype as always, but I am grateful to have seen in our team to see the actual adoption of that technology by people who, again, are not technologists.
23:43.748 --> 23:49.410
[SPEAKER_00]: They just know that it makes their work environment and solves a lot of problems for you on the business side.
23:51.212 --> 23:53.894
[SPEAKER_01]: And financial innovation is very powerful.
23:53.974 --> 24:02.702
[SPEAKER_01]: It can empower and destabilize how conscious are you of the downstream consequences of the capital you deploy.
24:03.697 --> 24:09.342
[SPEAKER_00]: Yeah, very, very, we do not position ourselves as impacting busters.
24:09.362 --> 24:12.245
[SPEAKER_00]: And we made that conscious decision when we started the firm, right?
24:12.285 --> 24:18.410
[SPEAKER_00]: We were in the throws of George Floyd's murder and, you know, myself being Hispanic.
24:18.450 --> 24:23.235
[SPEAKER_00]: My co-founder is African-American from East Oakland and my other from the Central Valley who's Jewish.
24:24.005 --> 24:28.768
[SPEAKER_00]: There's a lot of people raising capital the right ways and allocating it, trying to get more representation.
24:28.808 --> 24:36.712
[SPEAKER_00]: But what we decided is we want people to see us as great investors based on our access from our consultant, see in what we've done as operators.
24:37.673 --> 24:46.818
[SPEAKER_00]: But we do want to hold our values true, which is you can do good and do well and that financial technologies one of the greatest drivers of financial mobility and access.
24:46.858 --> 24:47.178
[SPEAKER_00]: And so,
24:47.798 --> 24:50.379
[SPEAKER_00]: We do, and in our deal memo, we look at opportunities.
24:50.439 --> 24:58.963
[SPEAKER_00]: We not just think like what is the market that they're solving for today, but if this works at scale, is this going to be a net positive or negative impact on the consumers they serve.
24:59.644 --> 25:01.625
[SPEAKER_00]: It's less about what we do do and more what we do.
25:01.665 --> 25:07.107
[SPEAKER_00]: So I mentioned earlier, gaming and gambling, things that can create these viral trends that ultimately largely hurt.
25:07.688 --> 25:14.171
[SPEAKER_00]: Folks, we do do some things around infrastructure and cross-border payments with stablecoins, but we don't do tokens, anything that can drive media.
25:15.031 --> 25:17.792
[SPEAKER_00]: and can hurt and consumers at the end of the day.
25:17.812 --> 25:26.215
[SPEAKER_00]: So yeah, so we predatory lending their certain businesses that just they go after groups and not very forthcoming ways.
25:26.275 --> 25:30.157
[SPEAKER_00]: Now there's ways you can do that in a positive light, but we pass largely on on those.
25:31.077 --> 25:46.599
[SPEAKER_00]: So, yeah, so we incorporate it, you know, we don't publish this outward, but we do track those metrics, we report annually in an impact report, some of our investors and backers are, they care about that, they want to make sure that you're doing what you say you're going to do and so it's our way.
25:47.200 --> 26:01.483
[SPEAKER_00]: of showing them that we are tracking this that this does matter, but for us it's just not something that we use as a marketing tool because we want people to see, again, CS is being great investor driving great returns, but certainly, you know, our our our our mission in ethos is aligned with that too.
26:03.604 --> 26:04.284
[SPEAKER_01]: Yeah, lovely.
26:04.404 --> 26:08.486
[SPEAKER_01]: Lovely to hear that because you're in a very impactful situation.
26:08.607 --> 26:12.629
[SPEAKER_01]: Of course, how do you define real progress and fintech?
26:13.209 --> 26:15.790
[SPEAKER_01]: Beyond valuation speed, adoption metrics.
26:16.150 --> 26:18.952
[SPEAKER_01]: What is true progress for you?
26:20.513 --> 26:25.075
[SPEAKER_00]: Yeah, I think it's, well, from an investor perspective, it's always revenue right.
26:25.115 --> 26:29.497
[SPEAKER_00]: So revenue is kind of like the biggest indicator that people are using a product and willing to pay for it.
26:29.637 --> 26:30.438
[SPEAKER_00]: And again, that's not,
26:32.282 --> 26:36.623
[SPEAKER_00]: in a predatory way, but in a way that showcases that there is value here, there's transactions.
26:37.544 --> 26:39.764
[SPEAKER_00]: But progress can be in a lot of different things, right?
26:39.944 --> 26:41.685
[SPEAKER_00]: It's how many end consumers are you serving?
26:41.965 --> 26:55.308
[SPEAKER_00]: And what we do in this annual report is we look at the companies that we have, the products that they have, and then the consumers that they serve, and it just shows we track that year over year, because essentially what we're looking for is how many more people have been able to
26:56.088 --> 27:01.349
[SPEAKER_00]: save better to spend better to get access to certain solutions that previously haven't had that.
27:01.469 --> 27:04.690
[SPEAKER_00]: So that's ultimately how we're tracking impact at the end of the day.
27:05.150 --> 27:07.851
[SPEAKER_00]: For the companies themselves and this is what we're held accountable for.
27:07.891 --> 27:14.613
[SPEAKER_00]: It's largely, you know, are they raising additional capital rounds, you know, we're audited, which means, you know, we have large financial institutions as backers.
27:14.633 --> 27:20.094
[SPEAKER_00]: So we have to show that we're doing the right thing to show value of that underlying asset, which is our investment.
27:20.854 --> 27:26.002
[SPEAKER_00]: In those cases, it's often based off, have they raised additional capital from net new investors via price round?
27:26.022 --> 27:27.064
[SPEAKER_00]: That's a good indication.
27:27.825 --> 27:32.352
[SPEAKER_00]: And then also for our auditors, it's looking at, you know, runway and revenue.
27:33.058 --> 27:53.843
[SPEAKER_00]: That's probably the less fun parts of what we get to do, but it's important because we're, you know, licensed financial institution, and we do have Bakters who we are stewards of their capital, and so that certainly we we like to track the impact that the companies are having on the world around us, but we also are very tactical on how do we track just performance from a reporting standpoint too.
27:54.711 --> 27:55.431
[SPEAKER_01]: Yeah, lovely.
27:55.951 --> 28:07.915
[SPEAKER_01]: And if we can start with some personal questions, what believe a lot of money success or innovation have you completely outgrown since you started working as a VC?
28:10.475 --> 28:16.357
[SPEAKER_00]: Yeah, you know, I think there's this perception and in some ways, you know, I even had it somewhat my naively.
28:16.757 --> 28:20.158
[SPEAKER_00]: The VC is a lot like Shark Tank popular show here in the US where
28:20.953 --> 28:24.935
[SPEAKER_00]: Founder walks up, you sit there, you ask a bunch of tough questions, you write a check or not.
28:24.955 --> 28:26.676
[SPEAKER_00]: And it's not that, right?
28:26.757 --> 28:42.286
[SPEAKER_00]: And for us, I'm lucky to have partners and we built out a firm where you product ties out the investing side, but my job is really building the firm, raising our capital, building these deep partnerships with our investors who are close partners of ours.
28:42.346 --> 28:47.009
[SPEAKER_00]: And so it's that it's building brand, it's things like that, but I think,
28:47.729 --> 29:03.105
[SPEAKER_00]: probably one of the biggest things that I've learned is that just how with us it takes time to write a check into a founder, it's elongated four or five times with the people we're raising capital from, which are large financial institutions, endowments, pension funds, family offices,
29:04.507 --> 29:06.928
[SPEAKER_00]: These are not short-term relationships.
29:06.968 --> 29:11.050
[SPEAKER_00]: They want to see that we are doing the things that we are saying that we're doing.
29:11.870 --> 29:15.832
[SPEAKER_00]: And it's important for us to cultivate that in a non-transsectional way over time, too.
29:16.092 --> 29:17.933
[SPEAKER_00]: And I get it.
29:18.033 --> 29:21.074
[SPEAKER_00]: It's actually my eyes have been open just to,
29:21.794 --> 29:32.381
[SPEAKER_00]: the people who are behind that allocator space and in what it takes to really, you know, do that job, which is a very difficult one, especially if you're investing across a whole variety of assets.
29:32.701 --> 29:36.564
[SPEAKER_00]: So I think that's probably the biggest one is just, it just takes time to build those relationships.
29:36.604 --> 29:39.426
[SPEAKER_00]: We're also a lot of empathy for the people who have to make those decisions.
29:40.046 --> 29:42.287
[SPEAKER_00]: It's not as easy as I like this I'm going to invest.
29:42.307 --> 29:44.249
[SPEAKER_00]: So it's just how it's not Shark Tank for us.
29:44.309 --> 29:47.811
[SPEAKER_00]: It's also not Shark Tank for, you know, the LPs who are evaluating these firms.
29:50.852 --> 29:57.897
[SPEAKER_01]: working so closely with capital shaped your understanding of power, particularly quiet and systematic power.
29:59.438 --> 30:04.963
[SPEAKER_00]: Yeah, I'll kind of speak personally, and then I'll kind of talk more systematically, or systematically.
30:06.163 --> 30:19.313
[SPEAKER_00]: For me, it's made me more conscious to that dynamic I mentioned earlier between investors and their founders, and even for us and our investors, is that whether it's spoken or unspoken, sometimes it can create a little bit of a power dynamic.
30:20.514 --> 30:29.242
[SPEAKER_00]: what I try to do and then I my partners are the same but we all kind of remind each other is again our job is not to tell the founders what to do or how to build their company.
30:29.842 --> 30:44.695
[SPEAKER_00]: Our role is to work for our founders and I've often seen this on board meetings where other VCs you know and in some cases those who don't have you know entrepreneurial or operating experience will come in with these really strong recommendations thinking that they're easy to implement.
30:45.175 --> 30:47.036
[SPEAKER_00]: The founder will think they need to go off and do them.
30:47.176 --> 30:48.696
[SPEAKER_00]: It distracts them from something else.
30:48.816 --> 30:52.417
[SPEAKER_00]: And it's just kind of a waste of everybody's time, and you get to the next board meeting or call.
30:52.757 --> 30:54.337
[SPEAKER_00]: And they'll say, hey, you had this idea.
30:54.357 --> 30:55.058
[SPEAKER_00]: I went out and did it.
30:55.098 --> 30:56.018
[SPEAKER_00]: It didn't work it for why.
30:56.278 --> 30:57.718
[SPEAKER_00]: It'll be like, oh, I forgot about that.
30:58.678 --> 31:02.319
[SPEAKER_00]: So there's a little bit of a dynamic then between the investor and the founder.
31:02.339 --> 31:07.901
[SPEAKER_00]: And so that power right for us is making sure that we don't that we acknowledge it with our founders.
31:07.961 --> 31:12.162
[SPEAKER_00]: We let them know this is our role in this relationship and that it's okay to tell us no.
31:12.902 --> 31:24.287
[SPEAKER_00]: And the best entrepreneurs are the ones who already know that because they've done it before, and so they're subtle and how they do it, but certainly for first-time founders or those that care about the relationship, it can be new.
31:24.427 --> 31:26.047
[SPEAKER_00]: So that's one just for us, right?
31:26.087 --> 31:28.788
[SPEAKER_00]: It's like, set a clean slate, make sure that we know the role that we play.
31:29.669 --> 31:35.031
[SPEAKER_00]: And broadly, outside of that, it does play a big role.
31:35.071 --> 31:39.493
[SPEAKER_00]: Certainly across asset allocation, asset ownership, consulting,
31:41.575 --> 31:50.067
[SPEAKER_00]: You know, a lot of the folks that we invest in are largely, you know, underrepresented founders are trying to enable betterment around the world for them.
31:50.147 --> 31:54.613
[SPEAKER_00]: And similar with other emerging managers who are in our peer set and who, you know, we work closely with them.
31:55.514 --> 31:56.395
[SPEAKER_00]: in power as well.
31:57.276 --> 32:06.844
[SPEAKER_00]: And at the end of the day, it's not sure numbers, it's dollars, you know, 75% of capital invested into venture capital is gone to 30 firms.
32:06.964 --> 32:11.968
[SPEAKER_00]: 20% of that went to a single firm in Dries and Horowitz, you know, with their $15 billion recent fund.
32:12.068 --> 32:19.954
[SPEAKER_00]: You're seeing this real aggregation of capital from these massive megafonds to these emerging managers like ourselves who are specialists in certain categories.
32:20.675 --> 32:30.922
[SPEAKER_00]: And that can create a little bit of an unhealthy dynamic with valuations and with who's actually getting access to the fruits of that capital and what does that mean for representation?
32:31.002 --> 32:39.868
[SPEAKER_00]: Again, that's a separate podcast maybe for a different topic, but that ultimately is what moves the needle and we're seeing that kind of bifurcated a little bit.
32:41.402 --> 32:49.308
[SPEAKER_01]: Yeah, and our philosophical question, what truth has stayed constant with you throughout this whole process?
32:49.969 --> 33:01.498
[SPEAKER_01]: You know, even when you were in an investor, like what's the truth that is holding you when things go wrong and what's the truth that you come back to?
33:02.856 --> 33:06.821
[SPEAKER_00]: Yeah, it's um, it's something again that I, but keep you on.
33:06.841 --> 33:07.221
[SPEAKER_00]: Yeah.
33:08.262 --> 33:09.043
[SPEAKER_00]: Yeah, definitely.
33:09.324 --> 33:12.367
[SPEAKER_00]: I, I am deeply moved outside of money, right?
33:12.547 --> 33:20.036
[SPEAKER_00]: I have an opportunity to do something that no one else in my family or my community where I'm from has ever had the chance to do and I don't take that lightly.
33:20.076 --> 33:20.457
[SPEAKER_00]: So like,
33:22.161 --> 33:31.348
[SPEAKER_00]: People will tell you for better or worse like I work and in my philosophy that has always worked for me is there's two things in this world that you can control your attitude and your level of effort.
33:31.848 --> 33:49.423
[SPEAKER_00]: You can't control the market, you can't control a lot of dynamics around you, but all you can control on those two and if I am successful, I hope it's because of that although luck is often engaged, but if I fail, I at least don't want to look back and wish that I worked harder, or that I sacrifice my integrity and character to do it.
33:49.943 --> 34:11.440
[SPEAKER_00]: And so I'd say those are the biggest ones is like when I go after these things when I have these really hard moments when you're backs up against the wall it's just I am not going to sacrifice who I am I'm going to keep this positive can do ultimately like optimistic in some cases maybe that's a fall and and just work hard it's you there's no shortcut to long term success it's compounding effort.
34:12.080 --> 34:37.362
[SPEAKER_00]: because that's ultimately what it takes and then from an attitude perspective it's bringing people up around you because at some point they're going to take care of you too and that's your reputation and again you mentioned it earlier trust is everything in this industry and so yeah that's kind of my mantra that's always really it's it's been good for me it doesn't mean I've always been successful I've certainly you know still make mistakes and and you know learn lessons all the time but that's that's what keeps me moving forward
34:38.835 --> 34:44.979
[SPEAKER_01]: Yeah, I would say three things in the investment world, hard work, trust, and sincerity.
34:45.099 --> 34:49.962
[SPEAKER_01]: You know, being open, I think there are the three, three, like, you know, beautiful traits.
34:50.703 --> 34:51.964
[SPEAKER_01]: Thank you very much, Marcos.
34:52.044 --> 34:54.365
[SPEAKER_01]: I enjoyed every moment of this conversation.
34:54.445 --> 34:54.986
[SPEAKER_01]: Just pass.
34:55.006 --> 34:59.649
[SPEAKER_01]: So, okay, can you believe it's 45 minutes, maybe?
34:59.709 --> 35:00.950
[SPEAKER_00]: Yeah, well, thank you so much.
35:01.590 --> 35:07.394
[SPEAKER_01]: Before you go, I ask this question to almost all of the guests I have.
35:07.734 --> 35:18.802
[SPEAKER_01]: If you could leave one message for the next generation of FinTech investors and founders about responsibility, restraint, trust, everything we talked about, what would that be?
35:21.363 --> 35:25.348
[SPEAKER_00]: I think it'd be that doing good and doing well aren't mutually exclusive.
35:25.969 --> 35:33.197
[SPEAKER_00]: The reason why China's successful is because it's reached tens of millions of consumers across the US to help them save for the first time and take away banking fees.
35:33.638 --> 35:36.000
[SPEAKER_00]: The reason why Robinhood's successful is largely the same.
35:36.821 --> 35:38.762
[SPEAKER_00]: And we're seeing that across that.
35:38.862 --> 35:44.285
[SPEAKER_00]: So again, I think people will chase hype in areas where they think that you can see the large success.
35:44.725 --> 35:48.007
[SPEAKER_00]: I think there's a lot to be said for a lot of the broken systems and structures.
35:48.627 --> 35:50.468
[SPEAKER_00]: And if you're doing good, you buy your customers.
35:50.508 --> 35:55.290
[SPEAKER_00]: If you're driving that meaningful change, then there is absolutely returns from that.
35:55.530 --> 35:59.352
[SPEAKER_00]: So for everyone kind of investor thinking, oh, now we're going into all these other sectors.
36:00.212 --> 36:05.295
[SPEAKER_00]: I would challenge them to think about what is the impact that you're leading on the world and end consumers around you.
36:06.055 --> 36:09.178
[SPEAKER_00]: And don't think that you're sacrificing returns in performance to do that.
36:09.298 --> 36:10.659
[SPEAKER_00]: It's actually the exact opposite.
36:12.260 --> 36:13.801
[SPEAKER_01]: Yeah, you know what they say.
36:13.821 --> 36:20.926
[SPEAKER_01]: If you want to create wealth, find a big problem and solve a big problem of a big group of people.
36:22.788 --> 36:23.268
[SPEAKER_00]: That's it.
36:23.348 --> 36:23.789
[SPEAKER_00]: That's it.
36:23.969 --> 36:26.911
[SPEAKER_01]: A group of people means just it's wealth.
36:27.941 --> 36:35.027
[SPEAKER_00]: And people are getting better access to, you know, mobile options, you're, you're seeing it, right?
36:35.127 --> 36:36.769
[SPEAKER_00]: The group of people is only growing.
36:36.949 --> 36:39.511
[SPEAKER_00]: And so yeah, that's, that's a great, great way to put it.
36:39.911 --> 36:44.836
[SPEAKER_00]: But put very simply to tell the R. That's, that's exactly what's that.
36:44.916 --> 36:46.517
[SPEAKER_01]: Yeah, thanks, Marcos.
36:46.597 --> 36:55.145
[SPEAKER_01]: And thanks to everyone who's listening and watching us on YouTube, I will remind you to become a subscriber on our channels.
36:55.809 --> 36:56.249
[SPEAKER_01]: Thank you.
36:56.490 --> 36:58.411
[SPEAKER_01]: A lot's Marcos, who was lovely.
36:59.592 --> 37:01.293
[SPEAKER_01]: Anything you would like to add at the end?
37:02.394 --> 37:03.495
[SPEAKER_00]: No, just thank you so much.
37:03.575 --> 37:05.536
[SPEAKER_00]: I'm such a big fan of the work that you do.
37:06.057 --> 37:08.498
[SPEAKER_00]: And also just back to the psychological aspect.
37:08.539 --> 37:18.906
[SPEAKER_00]: I think oftentimes people look at data and numbers and growths and markets, but at the end of the day, we are human beings working with human beings who are all trying to become better, but we are also certainly not perfect.
37:18.946 --> 37:20.387
[SPEAKER_00]: So thank you for all the work that you do
37:24.573 --> 37:25.474
[SPEAKER_00]: Still working on it.
37:26.195 --> 37:29.998
[SPEAKER_00]: We all have room to build, but yeah, it's been a fun ride so far.
37:30.099 --> 37:30.899
[SPEAKER_01]: On both sides.
37:31.880 --> 37:32.121
[SPEAKER_00]: Yes.
37:32.261 --> 37:32.561
[SPEAKER_00]: Yes.
37:32.801 --> 37:33.222
[SPEAKER_00]: Absolutely.
37:33.242 --> 37:33.582
[SPEAKER_01]: Sure.
37:34.143 --> 37:34.983
[SPEAKER_01]: Enjoy everyone.
37:35.043 --> 37:36.625
[SPEAKER_01]: And I'll see you in the next episode.
37:36.745 --> 37:37.246
[SPEAKER_01]: Thank you.
37:37.266 --> 37:38.186
[SPEAKER_01]: Bye for now.
37:39.328 --> 37:39.628
[SPEAKER_00]: Thank you.
00:00.211 --> 00:03.878
[SPEAKER_01]: Hello everyone, welcome to next level humanity podcast.
00:04.118 --> 00:06.763
[SPEAKER_01]: I have deers, Marcos Fernandez here.
00:06.863 --> 00:07.985
[SPEAKER_01]: Hi, Marcos are you.
00:08.860 --> 00:10.921
[SPEAKER_00]: I'm good, and I thank so much for having me on today.
00:11.001 --> 00:12.582
[SPEAKER_01]: And well, thanks for being here.
00:13.102 --> 00:19.444
[SPEAKER_01]: And our theme today is, trust time and the architecture of capital in financial systems.
00:20.345 --> 00:23.786
[SPEAKER_01]: Marcos is the founder of Fiat Ventures.
00:24.286 --> 00:26.747
[SPEAKER_01]: He lives in San Francisco Bay, area.
00:27.948 --> 00:30.869
[SPEAKER_01]: And you have been in the venture world for how long?
00:32.305 --> 00:39.511
[SPEAKER_00]: So we've had this fun for about five years, but I did a lot of cork-dev investing in angel investing for a good part of the last 15.
00:39.571 --> 00:42.153
[SPEAKER_00]: So a few cycles in a few different roles.
00:42.794 --> 00:43.394
[SPEAKER_01]: Yeah, great.
00:43.674 --> 00:48.999
[SPEAKER_01]: And you spent your career around financial systems, FinTech, capital formation.
00:49.619 --> 00:56.405
[SPEAKER_01]: When did investing stop being about transactions and start being a way you interpret the world?
00:56.945 --> 01:00.028
[SPEAKER_01]: And when did you decide on helping founders
01:01.324 --> 01:04.426
[SPEAKER_01]: helping innovative ideas shape the world basically.
01:05.507 --> 01:10.810
[SPEAKER_00]: Yeah, I'd actually say it started on the founders and ideas in the advising long before the capital.
01:11.210 --> 01:15.033
[SPEAKER_00]: Was there partly that was because you know you're building your own capital when you're younger and
01:15.891 --> 01:39.233
[SPEAKER_00]: You know, I went to grad school at UT and in Austin, and that was one of my first introductions to the robust world of startups and ecosystems, and yeah, your personal cash flow as a grad student is different than after you graduate, but what I found is that one of my favorite things to do was to go get a coffee or lunch with a founder, and the best part of those meetings is when the founder says, hold on, and pulls out a note pad and starts taking down notes, because like,
01:39.893 --> 01:58.193
[SPEAKER_00]: up until that point you know you're entertaining ideas but when someone is willing to pull out something to really take a note that's when you know you're you're striking a chord and so they really started as a lot of that and then as you know I was able to you know make more money it was small angel checks and a lot of that was more of I'm working with founders outside of my day job
01:58.994 --> 02:06.499
[SPEAKER_00]: And I'd get really excited about what they're building and they, you know, are allowing me to be able to participate in these rounds, which is really, you know, really cool.
02:06.560 --> 02:13.925
[SPEAKER_00]: And that's no balled into a little bit larger angel checks and in larger corp dev, you know, and you mentioned FinTech.
02:13.965 --> 02:16.647
[SPEAKER_00]: I started my FinTech career at so far in the
02:17.207 --> 02:36.161
[SPEAKER_00]: student lending space, we can happen to dive in more and then I went over to Ripple in the digital asset and crosswater payment space, whereas able to take on a lot of business development partnerships and corporate development roles, so starting to write more checks, but to your point, like it's not about the exchange of capital, like that's way too transactional.
02:36.341 --> 02:41.825
[SPEAKER_00]: It's about backing these phenomenal founders who are dedicating their lives to solving really key issues.
02:42.505 --> 02:54.573
[SPEAKER_00]: And the way that we see it is it's not just about solving issues to make money, but it's filling gaps in the world around us and we can kind of dive in more, but if it's just capital then it's just to transactional.
02:54.633 --> 03:03.880
[SPEAKER_00]: It's really finding folks who you can put everything behind and for us it's more than just capital with what we can bring to the table as part of Fiat Ventures in Fiat Growth.
03:03.920 --> 03:05.421
[SPEAKER_00]: But again, I'll pause there.
03:05.441 --> 03:06.682
[SPEAKER_00]: There's a ton more that we can dive into.
03:06.702 --> 03:07.182
[SPEAKER_01]: Yes, sure.
03:07.402 --> 03:11.365
[SPEAKER_01]: No, I mean, I'm wondering what really experiences shaped your understanding of
03:12.921 --> 03:20.865
[SPEAKER_01]: You know, trust and all the financial systems and, you know, where does this appetite for helping founders coming from?
03:21.585 --> 03:22.045
[SPEAKER_01]: Come for me.
03:22.165 --> 03:22.546
[SPEAKER_00]: Yeah.
03:23.146 --> 03:26.928
[SPEAKER_00]: I mean, a lot of just helping people in general is rooted in my upbringing.
03:26.988 --> 03:36.332
[SPEAKER_00]: So, you know, both my parents are from Mexico, I grew up in El Paso, Texas, wonderful community and my parents have done, you know, very, very well for themselves, given their backgrounds.
03:37.117 --> 03:41.899
[SPEAKER_00]: But in a place like Al Paso and you know the 90s, there's just not a ton of capital around.
03:41.939 --> 03:45.980
[SPEAKER_00]: So people aren't judging each other based on where do you work or where do you drive or where do you live?
03:46.020 --> 03:48.961
[SPEAKER_00]: It's much more based on your character and how you hold yourself.
03:49.041 --> 03:56.064
[SPEAKER_00]: And you also, you know, we spent a lot of time close with the church that I grew up in in different groups of just giving back and finding that.
03:56.104 --> 04:01.625
[SPEAKER_00]: So I gave credit to my parents of this like strong DNA of like leave this world a better place than when you found it.
04:02.246 --> 04:05.947
[SPEAKER_00]: And no matter how tough of a situation or in there's always ways that you can help others.
04:06.447 --> 04:17.896
[SPEAKER_00]: And so that's kind of part, and I'm very fortunate to have co-founders and partners who feel the same that for us with financial technology, we're proponents that you can do good and do well and not have to sacrifice returns for doing that.
04:17.976 --> 04:22.299
[SPEAKER_00]: That's not something that you have to do and give up on the alpha of it.
04:22.319 --> 04:26.703
[SPEAKER_00]: You're actually filling gaps and solving these real core problems for large swaths of people.
04:27.623 --> 04:37.574
[SPEAKER_00]: And so that as now we invest like it, that's a core value and the example that I get people right is as venture investors were trying to invest in a world five to 10 years from today.
04:38.194 --> 04:40.277
[SPEAKER_00]: That world is naturally more homogeneous.
04:40.417 --> 04:45.622
[SPEAKER_00]: There's more access to different services within financial services both here and across the world.
04:46.483 --> 04:47.925
[SPEAKER_00]: you know, there's a huge gaps.
04:48.005 --> 04:52.349
[SPEAKER_00]: There's, you know, hundreds of millions of people globally who are either under baker unbanked.
04:52.849 --> 04:55.492
[SPEAKER_00]: And basic access to services is not available.
04:55.532 --> 04:59.876
[SPEAKER_00]: And so what we look for, our founders who understand those problems are building solutions for them.
05:00.257 --> 05:04.681
[SPEAKER_00]: The net results is better financial access for, again, hundreds of millions of people globally.
05:05.162 --> 05:09.466
[SPEAKER_00]: And then you can build sustainable, profitable businesses based on the, the backbones of that.
05:09.666 --> 05:09.866
[SPEAKER_00]: So,
05:10.627 --> 05:22.135
[SPEAKER_00]: Again, kind of a long answer for a simple question, but some of it is for my upbringing in, you know, having a deep connection with, you know, doing good and doing well and then also having seen it as operators, we know that that model works.
05:23.697 --> 05:33.824
[SPEAKER_01]: Yeah, and before you become an investor, what values did you have already, you know, guiding you, is it like helping people, helping ideas and what else?
05:35.316 --> 05:39.879
[SPEAKER_00]: Yeah, I think a lot of it, and again, like credit to my parents is around selflessness.
05:39.899 --> 05:42.962
[SPEAKER_00]: So like my dad used to teach me this and I have a three and a five year old now.
05:42.982 --> 05:50.167
[SPEAKER_00]: So I'm trying to instill as many values as you can, but do something every day to help someone else out that no one else knows about.
05:50.347 --> 06:01.495
[SPEAKER_00]: So oftentimes today, you hear about these these things and oftentimes it's for brand building, but making it a habit in your daily life to just do something for someone and it doesn't have to be monumental from holding open a door to like,
06:01.995 --> 06:20.603
[SPEAKER_00]: buying some of that sandwich like it's doing these things that you can constantly doing in that selflessness even for our founders like we we need to know the role that we play there's often this unique tension between founders and investors and I get it because we two have investors and that dynamic is at play but I try to let our founders know that we work for them
06:21.363 --> 06:27.808
[SPEAKER_00]: Our job is to enable them to be better, not just through our capital, but through our network, through our operational experience, through our consultancy.
06:28.328 --> 06:32.211
[SPEAKER_00]: And so a lot, again, a lot of it is like, it's not a zero-sum game.
06:32.371 --> 06:33.732
[SPEAKER_00]: There's room for all of us to win.
06:34.312 --> 06:40.237
[SPEAKER_00]: And again, I'm lucky to have, you know, my two partners, Drew and Alex, who feel the exact same and have seen that come to fruition.
06:40.317 --> 06:40.517
[SPEAKER_00]: So,
06:40.957 --> 06:44.739
[SPEAKER_00]: We're kind of more of like, especially in venture, you can get the sharp elbows type principles.
06:44.779 --> 06:57.565
[SPEAKER_00]: We're more of a rising tide and trying to build a big ecosystem and lift people up with us and we are huge proponents that will serve us better in the long run than, you know, trying to, you know, catch edges and take advantage of founders or situations.
06:58.505 --> 07:04.868
[SPEAKER_01]: Yeah, I think building communities work amazing in the long, long term, the long run.
07:05.568 --> 07:06.649
[SPEAKER_01]: I have some
07:07.180 --> 07:30.032
[SPEAKER_01]: other VC friends who are also building their own communities and as the community builds it's not only about getting the funding but it's building our community around you that can help the companies you choose to help with the founders you choose to help and when we come back to FinTech, FinTech sits at the intersection of regulation, technology and human
07:37.965 --> 07:54.172
[SPEAKER_00]: Yeah, you bring up a good point of it sits at the centers, particularly psychology, right, where you're highly regulated and there's there's important protections in place, but also finances is one of the more personal things that individuals can think about.
07:54.292 --> 07:54.352
[SPEAKER_00]: And
07:55.192 --> 08:09.762
[SPEAKER_00]: And often times not in a positive light, you know, it's something that is, unfortunately, impacts a lot of people again globally, but certainly in the US, not in the most positive cadences, you know, some of the statistics around the lack of having savings, accounts, or lack of access.
08:10.283 --> 08:14.306
[SPEAKER_00]: And so there is almost a psychological barrier to become more comfortable with that.
08:15.086 --> 08:19.649
[SPEAKER_00]: And what we've seen really over the last ways, right, is the last, you know, call it FinTech evolution.
08:19.849 --> 08:24.072
[SPEAKER_00]: This is the, the so-fires, the times, the Robin Hoods, the betterments and wealth fronts.
08:24.532 --> 08:30.376
[SPEAKER_00]: But it took where physical brick and mortar stores and allowed you to digitize that, you know, largely through smartphones.
08:30.416 --> 08:31.997
[SPEAKER_00]: So now you have a bank in your pocket.
08:32.577 --> 08:42.142
[SPEAKER_00]: What we're starting to see now is consumers aren't just more comfortable doing financial services through these digital platforms, but they're also comfortable doing that with non-financial institutions.
08:42.662 --> 08:47.284
[SPEAKER_00]: So what I mean by that is, you know, Apple Pay and Google, they're now becoming some of the largest fintechs.
08:47.344 --> 08:48.845
[SPEAKER_00]: You see this with Shopify, right?
08:48.925 --> 08:53.107
[SPEAKER_00]: They have Shopify capital, which is now a big substantial part of their business.
08:53.167 --> 08:58.930
[SPEAKER_00]: And same with like Starbucks, the rewards program is one of the most successful fintech rewards platforms that have been launched.
09:00.030 --> 09:17.353
[SPEAKER_00]: You're starting to see that proliferation with brands that people trust almost lowered the psychological barriers because it feels less like I'm walking into to use it in a positive example, their investors are like a bank of America building that you know has these big pillars and you're walking up to someone at a window.
09:17.753 --> 09:23.574
[SPEAKER_00]: Now you can get exposure its ways to save, to better spend, to better manage your capital through much more user-friendly platforms.
09:23.634 --> 09:25.934
[SPEAKER_00]: And so that's a healthy thing because you're
09:29.695 --> 09:36.517
[SPEAKER_00]: In addition to that, you've seen the emergence of a lot of what you call like banking as a service or fintech platforms that allow you to launch products more easily.
09:37.398 --> 09:48.942
[SPEAKER_00]: What that means is more competition, which is not necessarily good for us and for our founders, but it's good for consumers because that means now that you have access to a whole bunch of different types of financial services through all these different platforms.
09:49.002 --> 09:56.124
[SPEAKER_00]: And so I think you're seeing it move in a very positive way where the abundance of options coupled with the familiarity, digital adoption,
09:56.704 --> 10:06.357
[SPEAKER_00]: and doing that with not necessarily large financial institutions is creating a really positive outcome ultimately for the end consumers who just need better access.
10:08.553 --> 10:17.997
[SPEAKER_01]: and after years of evaluating founders and markets where are you today like what do you trust today and how do you decide today?
10:18.037 --> 10:30.944
[SPEAKER_01]: Do you decide with data, with narratives, with maybe you have some pattern recognition, how do you decide and what kind of founders and projects are you or no compelled to back?
10:32.549 --> 10:35.050
[SPEAKER_00]: Yeah, definitely, it's an art and a science, right?
10:35.130 --> 10:41.251
[SPEAKER_00]: Like, there's not a clear, I wish there is a way that you could very clearly say this equals this equals that.
10:42.171 --> 10:47.452
[SPEAKER_00]: You know, for us, our model gives us a little bit of a unique advantage, so, you know, quick, quick overview.
10:48.012 --> 10:52.233
[SPEAKER_00]: Our venture arm certainly is a robust part of our business, but we also have a growth consultancy.
10:52.273 --> 10:56.754
[SPEAKER_00]: And this consultancy works with anywhere from 25 to 35 companies at any given time.
10:57.274 --> 11:01.538
[SPEAKER_00]: We've now worked with over 300 companies over the last seven years, and that's across stages.
11:01.558 --> 11:13.589
[SPEAKER_00]: That's pre-seed stage all the way to Fortune 100 companies, and what that does for us is it eloss us the ability to see what's going on across stages and across sectors to make better decisions around where we want to invest.
11:14.269 --> 11:37.668
[SPEAKER_00]: So for us, it almost creates a wake, this information, and this data cemetery to then allow us to make the best investments behind it, and to also attract great founders to the ecosystem because kind of back to we're not just providing capital and introductions, but we can be a hands-on participant in the growth of their organization, which is really rare and gives us a really good opportunity to help them build.
11:38.589 --> 11:40.891
[SPEAKER_00]: So with all that, yeah, there's a ton of data, right?
11:40.911 --> 11:42.793
[SPEAKER_00]: We're aggregating that across what we're seeing.
11:42.853 --> 11:44.834
[SPEAKER_00]: We're seeing a lot of trends.
11:44.854 --> 11:46.476
[SPEAKER_00]: We define our own trend reports.
11:46.496 --> 11:54.762
[SPEAKER_00]: We're actually getting ready to publish that at the beginning of March, annually, where we talk about what are the 10 to 12 things that are getting us the most excited, based on what we're seeing in market.
11:55.983 --> 12:03.669
[SPEAKER_00]: But then also, you know, the art of it, right, is especially because we're primarily investing at the seed stage, which is still very early.
12:04.610 --> 12:05.631
[SPEAKER_00]: You are backing founders.
12:05.651 --> 12:06.592
[SPEAKER_00]: You are backing people.
12:06.692 --> 12:11.015
[SPEAKER_00]: And at the end of the day, that is the number one reason why companies succeed or fail.
12:11.456 --> 12:13.978
[SPEAKER_00]: Ideas are important, but they can become commoditized.
12:14.078 --> 12:16.239
[SPEAKER_00]: Markets are very important, but they can shift.
12:16.880 --> 12:17.881
[SPEAKER_00]: Products change.
12:18.441 --> 12:19.762
[SPEAKER_00]: You know, there's so many examples.
12:19.822 --> 12:23.025
[SPEAKER_00]: And so what we really go towards then is founder, right?
12:23.125 --> 12:25.026
[SPEAKER_00]: And there's a couple ways we evaluate that.
12:25.947 --> 12:29.690
[SPEAKER_00]: One, it's not a term that only we use, but we use it as a founder market fit.
12:29.870 --> 12:37.877
[SPEAKER_00]: So what is your unique background that gives you perspective to this problem that you're solving, that then lets you kind of outwork everyone else.
12:38.057 --> 12:41.379
[SPEAKER_00]: We like to see velocity, so how quickly can you in the team ship product?
12:41.580 --> 12:44.342
[SPEAKER_00]: That means you'll have the ability to move quickly within those markets.
12:45.463 --> 13:01.457
[SPEAKER_00]: You know, we look at a lot of co-founder dynamics, you know, how did you meet, how long have you been working together, the number one reason why startups fail are from that, so we spend a little bit of psychological right of like what motivates you to build this and to dedicate your life towards this and, you know, at the end of the day we're ultimately, you know,
13:02.118 --> 13:28.753
[SPEAKER_00]: creating a partnership because we're again we're back in with capital but we're also providing a lot of time in services and vice versa those founders are now making us a part of that journey especially for leading around we're on the boards we've got governance and in in oversight and so it's important for them to to evaluate us just as much as we're evaluating them because at the end of the day it's a it's a two-way street or the best relationships so yeah another long answer for you so it's it's it's a lot of different things but founder
13:30.927 --> 13:46.783
[SPEAKER_01]: Yeah, and you also look for like self mastery of the founder, do you like it because my background is as you know, we have a lot of sciences and I'm always wondering like does the VCs see the self mastery potential like are they.
13:47.613 --> 14:02.945
[SPEAKER_01]: able to govern, you know, most areas in their lives, because when you, I think in Western Sea, that preceded that the characteristic traits of the founder are also important, like thus he or she,
14:04.214 --> 14:06.715
[SPEAKER_01]: That's, you know, do they do what they say?
14:06.735 --> 14:10.136
[SPEAKER_01]: Is she or he, someone who walks her talk?
14:10.716 --> 14:12.817
[SPEAKER_01]: So those are, like, also really important.
14:12.857 --> 14:15.558
[SPEAKER_01]: Maybe being open about things.
14:16.018 --> 14:20.900
[SPEAKER_01]: I mean, I can imagine, as we see, you want them to be open when things go get challenging as well.
14:21.040 --> 14:25.882
[SPEAKER_01]: You know, you don't want to hear only the things that go well, but also the things that go wrong.
14:26.282 --> 14:28.543
[SPEAKER_01]: But if they have, they have kind of like some,
14:28.943 --> 14:46.131
[SPEAKER_01]: I don't know, confidence issues or some, you know, other issues with themselves where they can have the potential to hide things, you know, things might go wrong or if they are having, you know, a hard time executing, they're having a hard time, you know, governing.
14:52.774 --> 15:04.677
[SPEAKER_01]: founders that are masters and that have the ability to govern and execute and the others that are not like what are the patterns you recognize?
15:05.897 --> 15:09.878
[SPEAKER_00]: Yeah, I'm glad you brought it up because it's not just an important thing.
15:09.898 --> 15:12.599
[SPEAKER_00]: It might be one of the if not the most important thing, right?
15:13.219 --> 15:15.359
[SPEAKER_00]: And it's one of the most hardest things to evaluate, right?
15:15.379 --> 15:21.801
[SPEAKER_00]: Because if you're a founder and you know, I get it too because I'm out there, you know, talking to people about our own venture capital fund
15:23.282 --> 15:40.737
[SPEAKER_00]: You're going out there and you're talking to hundreds of people, whether it's for capital raising or for hiring or for sales, and so it's easy to get into this routine, so as an evaluator of those characteristics, it's really difficult over Zoom or even in-person meetings to get a deep sense of, ultimately, I think of them as a trust.
15:41.358 --> 15:48.865
[SPEAKER_00]: Are you someone who trusts me, can I trust you, and not just to be stores of capital, but to be able to deliver on the promises that we're making each other?
15:49.665 --> 15:53.190
[SPEAKER_00]: and knowing that sometimes that's not always going to be great.
15:53.310 --> 15:56.534
[SPEAKER_00]: Like in any relationship, there will be speed bumps, there will be major hurdles.
15:56.995 --> 15:59.258
[SPEAKER_00]: I just want to know that you have my best interest in mining.
15:59.278 --> 16:01.120
[SPEAKER_00]: You know those best interests and vice versa.
16:01.500 --> 16:06.947
[SPEAKER_00]: I really try to understand what are the core things that you're trying to do so that I can take care of you along this journey as well.
16:07.868 --> 16:19.411
[SPEAKER_00]: It's a tough thing because again, the role that we play for leading around is we have to have the best interests of all the investors who pre-passed and current until we hand that torch in a future around and someone else takes on that responsibility.
16:19.931 --> 16:25.272
[SPEAKER_00]: So while we want to be very found or friendly, we also have to be very clear from a liability and governance perspective.
16:25.672 --> 16:30.253
[SPEAKER_00]: We have to ultimately ask questions on behalf of everyone who is on the cap table and
16:30.733 --> 16:37.096
[SPEAKER_00]: Again, as a founder, it's your responsibility to know that once you take on capital, that you are fiduciary of that, of that money, right?
16:37.216 --> 16:40.677
[SPEAKER_00]: It's not just, you know, fun and now you've got institutional backers.
16:40.697 --> 16:42.438
[SPEAKER_00]: There's there's a responsibility element.
16:42.478 --> 16:44.318
[SPEAKER_00]: So, yeah, it's your question.
16:44.999 --> 16:49.500
[SPEAKER_00]: It's, it's really difficult even when you think you know people sometimes certain characters succeed come out.
16:49.941 --> 16:51.761
[SPEAKER_00]: The other reality is nobody's perfect, right?
16:51.781 --> 16:52.542
[SPEAKER_00]: Like we're all human.
16:52.562 --> 16:55.303
[SPEAKER_00]: There's, there's not like the perfect someone that's figured it out.
16:55.903 --> 16:58.144
[SPEAKER_00]: So, so what we try to instill is, um,
16:59.068 --> 17:03.671
[SPEAKER_00]: You know, trust up front, I am always very direct and transparent throughout the process.
17:03.731 --> 17:04.491
[SPEAKER_00]: This is where you are.
17:04.511 --> 17:05.712
[SPEAKER_00]: Do you have any questions for me?
17:05.752 --> 17:08.654
[SPEAKER_00]: Like, just I don't want there to be any surprises at any point.
17:08.694 --> 17:12.316
[SPEAKER_00]: And I certainly don't want people to think that we're trying to hide anything because we're truly not.
17:12.336 --> 17:15.598
[SPEAKER_00]: We're trying to put together this, this, this partnerships together.
17:16.738 --> 17:24.344
[SPEAKER_00]: The other thing that for us that we're fortunate with is, in a lot of cases, some of the founders that we back are people who we've worked with for the patch, right?
17:24.384 --> 17:31.989
[SPEAKER_00]: So I mentioned this 300 plus companies in our, our ecosystem, some of the best investments that we've made are with founders that we've actually been working with for.
17:32.830 --> 17:34.350
[SPEAKER_00]: three, five, seven, eight years.
17:34.370 --> 17:42.913
[SPEAKER_00]: We've known them since we're in operating roles and and that is a huge advantage because you don't need to underwrite that as much because you've seen them in the trenches.
17:42.953 --> 17:47.034
[SPEAKER_00]: You know how they respond in tough situations and you can judge their character a lot more easily.
17:47.574 --> 17:50.695
[SPEAKER_00]: Vice versa for us, you know, they've seen how we operate.
17:50.735 --> 17:51.836
[SPEAKER_00]: They've seen us as operators.
17:51.856 --> 17:55.857
[SPEAKER_00]: They've seen what we're doing now and so that helps build trust on their side because they also understand that
17:56.617 --> 18:03.289
[SPEAKER_00]: We're not just trying to sell a game and then we like close a deal and then we're gone like there there are things that we intend on delivering on our side so
18:04.225 --> 18:05.526
[SPEAKER_00]: Yeah, it's it's a tough one.
18:05.546 --> 18:12.452
[SPEAKER_00]: There's no short answer for it, but it just takes time and in the best investments are those that we've been able to cultivate relationships with historically.
18:12.612 --> 18:13.593
[SPEAKER_01]: Yeah, storytelling.
18:13.613 --> 18:14.894
[SPEAKER_01]: Yeah, I can imagine.
18:15.514 --> 18:26.684
[SPEAKER_01]: And what do you think is the main mistake, other investors make when they underestimate the complexity of financial infrastructure?
18:27.565 --> 18:30.387
[SPEAKER_01]: What are the mistakes done in the investment war?
18:32.126 --> 18:46.807
[SPEAKER_00]: Yeah, specifically in our sector and I think any sector there's what you call like hype chasing right so there's like something big a sector people realize it's a big thing and what happens in that is people just know they want exposure to that sector.
18:47.428 --> 18:55.513
[SPEAKER_00]: The hardest part in venture is not just guessing what's going to work within an industry or market, but you also have to back the best team to do it.
18:55.734 --> 18:58.776
[SPEAKER_00]: And depending on where you're at, it's not always multiple winters.
18:58.796 --> 19:00.337
[SPEAKER_00]: There's like one within a category.
19:00.357 --> 19:03.639
[SPEAKER_00]: So that's, I think what you can see then is that certain trends arise.
19:04.079 --> 19:10.603
[SPEAKER_00]: Certainly, we're in a lot of an excitement around AI right now across a whole bunch of different sectors, which I'm happy to dive into.
19:10.703 --> 19:14.106
[SPEAKER_00]: There's a lot of validity behind that excitement, but also there's a lot of hype chasing.
19:14.786 --> 19:34.215
[SPEAKER_00]: and so that's what you need to be careful the most is not just getting exposure to a sector because you feel like you need it and here's a founder that can solve it but being patient enough to wait for the right opportunity even if that means you miss a certain sector and exposure and so yeah for for us the way that we approach that as we come up with these themes and thesises but ultimately we are backing founders.
19:35.015 --> 19:47.838
[SPEAKER_00]: So, you know, at the end of the day, if a founder comes and they're teaching us about something and it's opening our eyes up to something, that is a much higher likelihood of path to success than here's a company that falls within one of our main decent areas.
19:57.453 --> 19:59.635
[SPEAKER_01]: Yeah, great, great, great answer.
20:00.816 --> 20:02.657
[SPEAKER_01]: Yeah, I, I, it's hard.
20:03.238 --> 20:05.479
[SPEAKER_01]: Yeah, chasing the hype might not work always.
20:05.579 --> 20:12.905
[SPEAKER_01]: And where are we around the world in between AI and Fintech?
20:14.646 --> 20:16.248
[SPEAKER_00]: Yeah, it's interesting, right?
20:16.348 --> 20:19.530
[SPEAKER_00]: You know, on AI in general, and then I'll dive into finance.
20:19.771 --> 20:26.135
[SPEAKER_00]: I think we're at a moment, a positive one where we understand the implications of AI across software
20:27.360 --> 20:33.487
[SPEAKER_00]: And that's important, but we are also at a moment where you haven't necessarily seen the full commercialization of that and the way that we know it can happen.
20:34.008 --> 20:48.644
[SPEAKER_00]: And the example that I like to use is like, when the iPhones first came out, we knew that there is something powerful happening in the way that we communicate and can reach people, but we didn't know that, you know, that would open up a cadence where we're getting into strangers cars to go stay at a stranger's house, but, you know,
20:48.944 --> 20:51.367
[SPEAKER_00]: Now, it's weird if you don't use Uber and Airbnb, right?
20:51.407 --> 21:03.318
[SPEAKER_00]: Like so, so we're kind of at the stage where we understand that something big is happening and there's all these projections for what it can be, but we're not quite to the commercialization at mass that we need for it to be, but we will get there.
21:03.538 --> 21:07.902
[SPEAKER_00]: And so there's this almost like this in-between and historically, you know, we have been
21:08.903 --> 21:14.825
[SPEAKER_00]: We, I guess humans have been often underestimated the time it takes to get that broad adoption.
21:15.045 --> 21:15.385
[SPEAKER_00]: I'm sorry.
21:16.246 --> 21:21.027
[SPEAKER_00]: Yeah, underestimate it, but then also don't have a realization of how big those implications are over time.
21:21.788 --> 21:25.729
[SPEAKER_00]: And so, within financial services, particularly it's a little bit different.
21:25.749 --> 21:34.692
[SPEAKER_00]: You mentioned this earlier, but you have high degrees of regulation around personally identifiable information, PI, different structures are typically a little bit more
21:37.693 --> 21:47.358
[SPEAKER_00]: it's their place, and then certainly consumer protections are in place for the right reasons to make sure that anything this launch has positive impacts.
21:47.538 --> 21:55.663
[SPEAKER_00]: That's a whole different podcast on some of the trends that you see certainly around like gaming, gambling, but not that we want to make sure people are in a better position.
21:56.443 --> 22:03.247
[SPEAKER_00]: When it comes to AI, we're seeing a lot of really great applications, and it's not necessarily like the way that we interact with the iPhone.
22:03.327 --> 22:10.210
[SPEAKER_00]: But it's in these really archaic spaces within traditional financial services that just have never been digitized.
22:10.551 --> 22:11.711
[SPEAKER_00]: And now you can start to build.
22:11.951 --> 22:14.873
[SPEAKER_00]: I'll give a couple examples within health care and payments.
22:15.373 --> 22:16.674
[SPEAKER_00]: and processing and coding.
22:17.014 --> 22:29.183
[SPEAKER_00]: We've made a few investments in some really phenomenal founders where it's helping you whether it comes to social work or understanding as an individual, what you should not just enroll in, but how to get rebates back, what you do there.
22:29.863 --> 22:39.370
[SPEAKER_00]: Billing, solving those core issues that lead to this incredible reconciliation process that is really hard for individuals, especially in outpatient clinics and especially mental health services.
22:40.050 --> 22:53.117
[SPEAKER_00]: So you're seeing really good applications, another one that we're just closing on within the insurance space, really boring stuff, but like mid-market brokers and MGA's and PNC coverage, that are just used to having to spend eight hours to buy and to draft the policy.
22:53.137 --> 23:00.981
[SPEAKER_00]: You cannot do that in like eight seconds, just integrating to all these different systems on their APIs and creating an agent like environment to just make it easier.
23:01.001 --> 23:02.822
[SPEAKER_00]: And people love it because,
23:03.682 --> 23:07.765
[SPEAKER_00]: what we look for are not customers who are looking for AI exposure to say they're using it.
23:08.146 --> 23:11.048
[SPEAKER_00]: We're looking for customers who don't really care what's being used.
23:11.088 --> 23:13.970
[SPEAKER_00]: They just know it's a 20 x improvement on whatever they're doing today.
23:14.711 --> 23:24.919
[SPEAKER_00]: And so when you think about that in AI, I get really excited because out of all the industries, because of everything that I mentioned, the legacy infrastructure, the regulations, it's one of the oldest to change.
23:25.459 --> 23:31.504
[SPEAKER_00]: But it's also one that is just ripe with all these processes that are very replicable to help make it easier.
23:31.784 --> 23:32.105
[SPEAKER_00]: And so
23:32.665 --> 23:34.125
[SPEAKER_00]: Yeah, I get excited now.
23:34.145 --> 23:43.708
[SPEAKER_00]: There is a lot of hype as always, but I am grateful to have seen in our team to see the actual adoption of that technology by people who, again, are not technologists.
23:43.748 --> 23:49.410
[SPEAKER_00]: They just know that it makes their work environment and solves a lot of problems for you on the business side.
23:51.212 --> 23:53.894
[SPEAKER_01]: And financial innovation is very powerful.
23:53.974 --> 24:02.702
[SPEAKER_01]: It can empower and destabilize how conscious are you of the downstream consequences of the capital you deploy.
24:03.697 --> 24:09.342
[SPEAKER_00]: Yeah, very, very, we do not position ourselves as impacting busters.
24:09.362 --> 24:12.245
[SPEAKER_00]: And we made that conscious decision when we started the firm, right?
24:12.285 --> 24:18.410
[SPEAKER_00]: We were in the throws of George Floyd's murder and, you know, myself being Hispanic.
24:18.450 --> 24:23.235
[SPEAKER_00]: My co-founder is African-American from East Oakland and my other from the Central Valley who's Jewish.
24:24.005 --> 24:28.768
[SPEAKER_00]: There's a lot of people raising capital the right ways and allocating it, trying to get more representation.
24:28.808 --> 24:36.712
[SPEAKER_00]: But what we decided is we want people to see us as great investors based on our access from our consultant, see in what we've done as operators.
24:37.673 --> 24:46.818
[SPEAKER_00]: But we do want to hold our values true, which is you can do good and do well and that financial technologies one of the greatest drivers of financial mobility and access.
24:46.858 --> 24:47.178
[SPEAKER_00]: And so,
24:47.798 --> 24:50.379
[SPEAKER_00]: We do, and in our deal memo, we look at opportunities.
24:50.439 --> 24:58.963
[SPEAKER_00]: We not just think like what is the market that they're solving for today, but if this works at scale, is this going to be a net positive or negative impact on the consumers they serve.
24:59.644 --> 25:01.625
[SPEAKER_00]: It's less about what we do do and more what we do.
25:01.665 --> 25:07.107
[SPEAKER_00]: So I mentioned earlier, gaming and gambling, things that can create these viral trends that ultimately largely hurt.
25:07.688 --> 25:14.171
[SPEAKER_00]: Folks, we do do some things around infrastructure and cross-border payments with stablecoins, but we don't do tokens, anything that can drive media.
25:15.031 --> 25:17.792
[SPEAKER_00]: and can hurt and consumers at the end of the day.
25:17.812 --> 25:26.215
[SPEAKER_00]: So yeah, so we predatory lending their certain businesses that just they go after groups and not very forthcoming ways.
25:26.275 --> 25:30.157
[SPEAKER_00]: Now there's ways you can do that in a positive light, but we pass largely on on those.
25:31.077 --> 25:46.599
[SPEAKER_00]: So, yeah, so we incorporate it, you know, we don't publish this outward, but we do track those metrics, we report annually in an impact report, some of our investors and backers are, they care about that, they want to make sure that you're doing what you say you're going to do and so it's our way.
25:47.200 --> 26:01.483
[SPEAKER_00]: of showing them that we are tracking this that this does matter, but for us it's just not something that we use as a marketing tool because we want people to see, again, CS is being great investor driving great returns, but certainly, you know, our our our our mission in ethos is aligned with that too.
26:03.604 --> 26:04.284
[SPEAKER_01]: Yeah, lovely.
26:04.404 --> 26:08.486
[SPEAKER_01]: Lovely to hear that because you're in a very impactful situation.
26:08.607 --> 26:12.629
[SPEAKER_01]: Of course, how do you define real progress and fintech?
26:13.209 --> 26:15.790
[SPEAKER_01]: Beyond valuation speed, adoption metrics.
26:16.150 --> 26:18.952
[SPEAKER_01]: What is true progress for you?
26:20.513 --> 26:25.075
[SPEAKER_00]: Yeah, I think it's, well, from an investor perspective, it's always revenue right.
26:25.115 --> 26:29.497
[SPEAKER_00]: So revenue is kind of like the biggest indicator that people are using a product and willing to pay for it.
26:29.637 --> 26:30.438
[SPEAKER_00]: And again, that's not,
26:32.282 --> 26:36.623
[SPEAKER_00]: in a predatory way, but in a way that showcases that there is value here, there's transactions.
26:37.544 --> 26:39.764
[SPEAKER_00]: But progress can be in a lot of different things, right?
26:39.944 --> 26:41.685
[SPEAKER_00]: It's how many end consumers are you serving?
26:41.965 --> 26:55.308
[SPEAKER_00]: And what we do in this annual report is we look at the companies that we have, the products that they have, and then the consumers that they serve, and it just shows we track that year over year, because essentially what we're looking for is how many more people have been able to
26:56.088 --> 27:01.349
[SPEAKER_00]: save better to spend better to get access to certain solutions that previously haven't had that.
27:01.469 --> 27:04.690
[SPEAKER_00]: So that's ultimately how we're tracking impact at the end of the day.
27:05.150 --> 27:07.851
[SPEAKER_00]: For the companies themselves and this is what we're held accountable for.
27:07.891 --> 27:14.613
[SPEAKER_00]: It's largely, you know, are they raising additional capital rounds, you know, we're audited, which means, you know, we have large financial institutions as backers.
27:14.633 --> 27:20.094
[SPEAKER_00]: So we have to show that we're doing the right thing to show value of that underlying asset, which is our investment.
27:20.854 --> 27:26.002
[SPEAKER_00]: In those cases, it's often based off, have they raised additional capital from net new investors via price round?
27:26.022 --> 27:27.064
[SPEAKER_00]: That's a good indication.
27:27.825 --> 27:32.352
[SPEAKER_00]: And then also for our auditors, it's looking at, you know, runway and revenue.
27:33.058 --> 27:53.843
[SPEAKER_00]: That's probably the less fun parts of what we get to do, but it's important because we're, you know, licensed financial institution, and we do have Bakters who we are stewards of their capital, and so that certainly we we like to track the impact that the companies are having on the world around us, but we also are very tactical on how do we track just performance from a reporting standpoint too.
27:54.711 --> 27:55.431
[SPEAKER_01]: Yeah, lovely.
27:55.951 --> 28:07.915
[SPEAKER_01]: And if we can start with some personal questions, what believe a lot of money success or innovation have you completely outgrown since you started working as a VC?
28:10.475 --> 28:16.357
[SPEAKER_00]: Yeah, you know, I think there's this perception and in some ways, you know, I even had it somewhat my naively.
28:16.757 --> 28:20.158
[SPEAKER_00]: The VC is a lot like Shark Tank popular show here in the US where
28:20.953 --> 28:24.935
[SPEAKER_00]: Founder walks up, you sit there, you ask a bunch of tough questions, you write a check or not.
28:24.955 --> 28:26.676
[SPEAKER_00]: And it's not that, right?
28:26.757 --> 28:42.286
[SPEAKER_00]: And for us, I'm lucky to have partners and we built out a firm where you product ties out the investing side, but my job is really building the firm, raising our capital, building these deep partnerships with our investors who are close partners of ours.
28:42.346 --> 28:47.009
[SPEAKER_00]: And so it's that it's building brand, it's things like that, but I think,
28:47.729 --> 29:03.105
[SPEAKER_00]: probably one of the biggest things that I've learned is that just how with us it takes time to write a check into a founder, it's elongated four or five times with the people we're raising capital from, which are large financial institutions, endowments, pension funds, family offices,
29:04.507 --> 29:06.928
[SPEAKER_00]: These are not short-term relationships.
29:06.968 --> 29:11.050
[SPEAKER_00]: They want to see that we are doing the things that we are saying that we're doing.
29:11.870 --> 29:15.832
[SPEAKER_00]: And it's important for us to cultivate that in a non-transsectional way over time, too.
29:16.092 --> 29:17.933
[SPEAKER_00]: And I get it.
29:18.033 --> 29:21.074
[SPEAKER_00]: It's actually my eyes have been open just to,
29:21.794 --> 29:32.381
[SPEAKER_00]: the people who are behind that allocator space and in what it takes to really, you know, do that job, which is a very difficult one, especially if you're investing across a whole variety of assets.
29:32.701 --> 29:36.564
[SPEAKER_00]: So I think that's probably the biggest one is just, it just takes time to build those relationships.
29:36.604 --> 29:39.426
[SPEAKER_00]: We're also a lot of empathy for the people who have to make those decisions.
29:40.046 --> 29:42.287
[SPEAKER_00]: It's not as easy as I like this I'm going to invest.
29:42.307 --> 29:44.249
[SPEAKER_00]: So it's just how it's not Shark Tank for us.
29:44.309 --> 29:47.811
[SPEAKER_00]: It's also not Shark Tank for, you know, the LPs who are evaluating these firms.
29:50.852 --> 29:57.897
[SPEAKER_01]: working so closely with capital shaped your understanding of power, particularly quiet and systematic power.
29:59.438 --> 30:04.963
[SPEAKER_00]: Yeah, I'll kind of speak personally, and then I'll kind of talk more systematically, or systematically.
30:06.163 --> 30:19.313
[SPEAKER_00]: For me, it's made me more conscious to that dynamic I mentioned earlier between investors and their founders, and even for us and our investors, is that whether it's spoken or unspoken, sometimes it can create a little bit of a power dynamic.
30:20.514 --> 30:29.242
[SPEAKER_00]: what I try to do and then I my partners are the same but we all kind of remind each other is again our job is not to tell the founders what to do or how to build their company.
30:29.842 --> 30:44.695
[SPEAKER_00]: Our role is to work for our founders and I've often seen this on board meetings where other VCs you know and in some cases those who don't have you know entrepreneurial or operating experience will come in with these really strong recommendations thinking that they're easy to implement.
30:45.175 --> 30:47.036
[SPEAKER_00]: The founder will think they need to go off and do them.
30:47.176 --> 30:48.696
[SPEAKER_00]: It distracts them from something else.
30:48.816 --> 30:52.417
[SPEAKER_00]: And it's just kind of a waste of everybody's time, and you get to the next board meeting or call.
30:52.757 --> 30:54.337
[SPEAKER_00]: And they'll say, hey, you had this idea.
30:54.357 --> 30:55.058
[SPEAKER_00]: I went out and did it.
30:55.098 --> 30:56.018
[SPEAKER_00]: It didn't work it for why.
30:56.278 --> 30:57.718
[SPEAKER_00]: It'll be like, oh, I forgot about that.
30:58.678 --> 31:02.319
[SPEAKER_00]: So there's a little bit of a dynamic then between the investor and the founder.
31:02.339 --> 31:07.901
[SPEAKER_00]: And so that power right for us is making sure that we don't that we acknowledge it with our founders.
31:07.961 --> 31:12.162
[SPEAKER_00]: We let them know this is our role in this relationship and that it's okay to tell us no.
31:12.902 --> 31:24.287
[SPEAKER_00]: And the best entrepreneurs are the ones who already know that because they've done it before, and so they're subtle and how they do it, but certainly for first-time founders or those that care about the relationship, it can be new.
31:24.427 --> 31:26.047
[SPEAKER_00]: So that's one just for us, right?
31:26.087 --> 31:28.788
[SPEAKER_00]: It's like, set a clean slate, make sure that we know the role that we play.
31:29.669 --> 31:35.031
[SPEAKER_00]: And broadly, outside of that, it does play a big role.
31:35.071 --> 31:39.493
[SPEAKER_00]: Certainly across asset allocation, asset ownership, consulting,
31:41.575 --> 31:50.067
[SPEAKER_00]: You know, a lot of the folks that we invest in are largely, you know, underrepresented founders are trying to enable betterment around the world for them.
31:50.147 --> 31:54.613
[SPEAKER_00]: And similar with other emerging managers who are in our peer set and who, you know, we work closely with them.
31:55.514 --> 31:56.395
[SPEAKER_00]: in power as well.
31:57.276 --> 32:06.844
[SPEAKER_00]: And at the end of the day, it's not sure numbers, it's dollars, you know, 75% of capital invested into venture capital is gone to 30 firms.
32:06.964 --> 32:11.968
[SPEAKER_00]: 20% of that went to a single firm in Dries and Horowitz, you know, with their $15 billion recent fund.
32:12.068 --> 32:19.954
[SPEAKER_00]: You're seeing this real aggregation of capital from these massive megafonds to these emerging managers like ourselves who are specialists in certain categories.
32:20.675 --> 32:30.922
[SPEAKER_00]: And that can create a little bit of an unhealthy dynamic with valuations and with who's actually getting access to the fruits of that capital and what does that mean for representation?
32:31.002 --> 32:39.868
[SPEAKER_00]: Again, that's a separate podcast maybe for a different topic, but that ultimately is what moves the needle and we're seeing that kind of bifurcated a little bit.
32:41.402 --> 32:49.308
[SPEAKER_01]: Yeah, and our philosophical question, what truth has stayed constant with you throughout this whole process?
32:49.969 --> 33:01.498
[SPEAKER_01]: You know, even when you were in an investor, like what's the truth that is holding you when things go wrong and what's the truth that you come back to?
33:02.856 --> 33:06.821
[SPEAKER_00]: Yeah, it's um, it's something again that I, but keep you on.
33:06.841 --> 33:07.221
[SPEAKER_00]: Yeah.
33:08.262 --> 33:09.043
[SPEAKER_00]: Yeah, definitely.
33:09.324 --> 33:12.367
[SPEAKER_00]: I, I am deeply moved outside of money, right?
33:12.547 --> 33:20.036
[SPEAKER_00]: I have an opportunity to do something that no one else in my family or my community where I'm from has ever had the chance to do and I don't take that lightly.
33:20.076 --> 33:20.457
[SPEAKER_00]: So like,
33:22.161 --> 33:31.348
[SPEAKER_00]: People will tell you for better or worse like I work and in my philosophy that has always worked for me is there's two things in this world that you can control your attitude and your level of effort.
33:31.848 --> 33:49.423
[SPEAKER_00]: You can't control the market, you can't control a lot of dynamics around you, but all you can control on those two and if I am successful, I hope it's because of that although luck is often engaged, but if I fail, I at least don't want to look back and wish that I worked harder, or that I sacrifice my integrity and character to do it.
33:49.943 --> 34:11.440
[SPEAKER_00]: And so I'd say those are the biggest ones is like when I go after these things when I have these really hard moments when you're backs up against the wall it's just I am not going to sacrifice who I am I'm going to keep this positive can do ultimately like optimistic in some cases maybe that's a fall and and just work hard it's you there's no shortcut to long term success it's compounding effort.
34:12.080 --> 34:37.362
[SPEAKER_00]: because that's ultimately what it takes and then from an attitude perspective it's bringing people up around you because at some point they're going to take care of you too and that's your reputation and again you mentioned it earlier trust is everything in this industry and so yeah that's kind of my mantra that's always really it's it's been good for me it doesn't mean I've always been successful I've certainly you know still make mistakes and and you know learn lessons all the time but that's that's what keeps me moving forward
34:38.835 --> 34:44.979
[SPEAKER_01]: Yeah, I would say three things in the investment world, hard work, trust, and sincerity.
34:45.099 --> 34:49.962
[SPEAKER_01]: You know, being open, I think there are the three, three, like, you know, beautiful traits.
34:50.703 --> 34:51.964
[SPEAKER_01]: Thank you very much, Marcos.
34:52.044 --> 34:54.365
[SPEAKER_01]: I enjoyed every moment of this conversation.
34:54.445 --> 34:54.986
[SPEAKER_01]: Just pass.
34:55.006 --> 34:59.649
[SPEAKER_01]: So, okay, can you believe it's 45 minutes, maybe?
34:59.709 --> 35:00.950
[SPEAKER_00]: Yeah, well, thank you so much.
35:01.590 --> 35:07.394
[SPEAKER_01]: Before you go, I ask this question to almost all of the guests I have.
35:07.734 --> 35:18.802
[SPEAKER_01]: If you could leave one message for the next generation of FinTech investors and founders about responsibility, restraint, trust, everything we talked about, what would that be?
35:21.363 --> 35:25.348
[SPEAKER_00]: I think it'd be that doing good and doing well aren't mutually exclusive.
35:25.969 --> 35:33.197
[SPEAKER_00]: The reason why China's successful is because it's reached tens of millions of consumers across the US to help them save for the first time and take away banking fees.
35:33.638 --> 35:36.000
[SPEAKER_00]: The reason why Robinhood's successful is largely the same.
35:36.821 --> 35:38.762
[SPEAKER_00]: And we're seeing that across that.
35:38.862 --> 35:44.285
[SPEAKER_00]: So again, I think people will chase hype in areas where they think that you can see the large success.
35:44.725 --> 35:48.007
[SPEAKER_00]: I think there's a lot to be said for a lot of the broken systems and structures.
35:48.627 --> 35:50.468
[SPEAKER_00]: And if you're doing good, you buy your customers.
35:50.508 --> 35:55.290
[SPEAKER_00]: If you're driving that meaningful change, then there is absolutely returns from that.
35:55.530 --> 35:59.352
[SPEAKER_00]: So for everyone kind of investor thinking, oh, now we're going into all these other sectors.
36:00.212 --> 36:05.295
[SPEAKER_00]: I would challenge them to think about what is the impact that you're leading on the world and end consumers around you.
36:06.055 --> 36:09.178
[SPEAKER_00]: And don't think that you're sacrificing returns in performance to do that.
36:09.298 --> 36:10.659
[SPEAKER_00]: It's actually the exact opposite.
36:12.260 --> 36:13.801
[SPEAKER_01]: Yeah, you know what they say.
36:13.821 --> 36:20.926
[SPEAKER_01]: If you want to create wealth, find a big problem and solve a big problem of a big group of people.
36:22.788 --> 36:23.268
[SPEAKER_00]: That's it.
36:23.348 --> 36:23.789
[SPEAKER_00]: That's it.
36:23.969 --> 36:26.911
[SPEAKER_01]: A group of people means just it's wealth.
36:27.941 --> 36:35.027
[SPEAKER_00]: And people are getting better access to, you know, mobile options, you're, you're seeing it, right?
36:35.127 --> 36:36.769
[SPEAKER_00]: The group of people is only growing.
36:36.949 --> 36:39.511
[SPEAKER_00]: And so yeah, that's, that's a great, great way to put it.
36:39.911 --> 36:44.836
[SPEAKER_00]: But put very simply to tell the R. That's, that's exactly what's that.
36:44.916 --> 36:46.517
[SPEAKER_01]: Yeah, thanks, Marcos.
36:46.597 --> 36:55.145
[SPEAKER_01]: And thanks to everyone who's listening and watching us on YouTube, I will remind you to become a subscriber on our channels.
36:55.809 --> 36:56.249
[SPEAKER_01]: Thank you.
36:56.490 --> 36:58.411
[SPEAKER_01]: A lot's Marcos, who was lovely.
36:59.592 --> 37:01.293
[SPEAKER_01]: Anything you would like to add at the end?
37:02.394 --> 37:03.495
[SPEAKER_00]: No, just thank you so much.
37:03.575 --> 37:05.536
[SPEAKER_00]: I'm such a big fan of the work that you do.
37:06.057 --> 37:08.498
[SPEAKER_00]: And also just back to the psychological aspect.
37:08.539 --> 37:18.906
[SPEAKER_00]: I think oftentimes people look at data and numbers and growths and markets, but at the end of the day, we are human beings working with human beings who are all trying to become better, but we are also certainly not perfect.
37:18.946 --> 37:20.387
[SPEAKER_00]: So thank you for all the work that you do
37:24.573 --> 37:25.474
[SPEAKER_00]: Still working on it.
37:26.195 --> 37:29.998
[SPEAKER_00]: We all have room to build, but yeah, it's been a fun ride so far.
37:30.099 --> 37:30.899
[SPEAKER_01]: On both sides.
37:31.880 --> 37:32.121
[SPEAKER_00]: Yes.
37:32.261 --> 37:32.561
[SPEAKER_00]: Yes.
37:32.801 --> 37:33.222
[SPEAKER_00]: Absolutely.
37:33.242 --> 37:33.582
[SPEAKER_01]: Sure.
37:34.143 --> 37:34.983
[SPEAKER_01]: Enjoy everyone.
37:35.043 --> 37:36.625
[SPEAKER_01]: And I'll see you in the next episode.
37:36.745 --> 37:37.246
[SPEAKER_01]: Thank you.
37:37.266 --> 37:38.186
[SPEAKER_01]: Bye for now.
37:39.328 --> 37:39.628
[SPEAKER_00]: Thank you.
