VC Investing Our Way Out of Winter by Julia Zhou

[Music] our next panel the um hello everyone good afternoon this is our next panel VC investing out of the winter today we will talk about the new investment Trend and how we were going to face this Market a winter has definitely here with the current flow of the market definitely a lot has happened but we can also face the research strategy as the new stabilization of our Market going forward crypto Market can be stronger and have more stabilization historically speaking BC actually has better returns in the bear Market when the valuation slows down and more more approach more access to the greater team and also lower old packs for the team going forward and this is a time when BC is including our fund are still investing and still creating value so for Venture Capital we not only provide capital of supporting great teams is also part of our mission and our a lot of reasons why we joined the industry at the very first place but with winter coming how can we be optimistic in this market while being conversational when the bull market finally comes with this notion in mind today we have invited seasoned investors to join panel um to to give us to share their thoughts about how they have changed their Investments what is their forecast going forward so before we started maybe each of our honored panelists can give us a short intro about their fund when we start with Anthony can you um sorry can you introduce about your fund sure hi everyone uh Anthony here from Newman Capital I'll kind of keep it short because we were talking about how people spend like long time introducing the fun we're a seed stage to create um or even a early stage VCS mostly focus in the consumer space um and weapery consumer buy that so uh yeah hi everyone my name is Carl I'm a partner and head of research at six man Ventures we're an early stage web 3 fund investing across different uh you know across the crypto landscape and across different ecosystems I think what really um you know makes this unique is you know everyone on the team is all prior entrepreneurs or Builders and so we really tend to specialize in founder mentorship go to market product strategy and tokenomics research making and trading firm we've been around since 2017 and I head up the Venture and services arm of our business so our specialty as an investor is one that we know the space being operators for the past five years and two we're market makers so there's a lot of services and ways that we can help our portfolio companies uh hi my name is Mikko I'm with Gumi cryptos Capital uh we deployed our first fund into the crypto winter of 2018 21 million dollar fund and we recently raised 110. so we're deploying it now into very early stage projects so if you're just kind of forming your teams out there in the hallway right now definitely come talk to us uh and we'll be happy to uh you know hang out thank you thank you so my name is Andrea Chong I'm partner at NGC Ventures our Founders based in Singapore we have a fabulous things 2018 and our focus is male infrastructure also metaverse Again by infrastructure so going to the quest first question uh let's see from the bigger picture as the winter comes how does your investment change during bull market is it a rapid change or is it a gradual change or any obvious pain can you share with us what makes the difference yeah because of our experience in the previous crypto winter basically in the bull market we slow down and in the bear Market we speed up so we're we're more actively deploying now uh and we're very uh excited to uh see all these amazing High conviction Founders coming out of the woodwork so you know that's that's what's exciting to us I think the bull market you have lots of low conviction Founders who are just kind of like oh I'm launching my own metaverse and I don't understand that so you know for us like we're very excited to be here and you know I think that's the change is we're deploying more and faster in the bear than in a bowl yeah for us um we maintain the exact same you know investment evaluation process underwriting process due diligence that is exactly the same in all market conditions um but as Miko is alluding to in a bull market you know you have a day sometimes two days before something closes right and you don't really have time to DD the way that you should in a bear Market you have more time you have um you know I think higher quality founders with all the tech layoffs that have been happening recently I expect to see a lot more of those people deciding that entrepreneurship is better than a job at a big tech company so I expect to see more quality projects so we're very excited to be investing in the bear Market you really want to Echo some of those points especially around having time to get to know the founder uh that you know there it's been very real 48 hours to make a decision you're trying to run the process through four Partners it's it's really challenging versus now we actually get to know the builders um the other thing I'd add is in the bear Market um we actually get a chance to take bigger swings in the bull market everything gets so marked up to you know I think unsustainable levels and as part of that from a risk return perspective you really just can't justify some of the um you know likelihood of outcomes with the current valuation of these companies and what you might be able to get on the other side of it but now you know things have slowed down there's less urgency in this space and we can really get back to building and so we actually can invest um and partner with Founders who can build for longer periods of time before they deploy instead of feeling rushed to like bring things to Market to try to catch the next news cycle that oftentimes happens during the bull market yeah I would agree most of um the other panelists and from our perspective we actually started the fun in the bull market and it was very fortunate that we stay rational and I would almost say that during the bull market we didn't really make a lot of investment and it was starting sort of like a slow transition right like starting from um late last year we you know we kind of speed up our investment and I think right now it's full steam ahead you know it's we are in a winter um but what I like about kind of like the current environment is that Founders are more rational and when they are more rational they are willing to work with investors in understanding what they're trying to build understanding their vision and that oftentimes translate into long-term conviction for us as an investors because we really understand the founders and I think for my personal background also as a Founder before building in a bear Market is extremely difficult and you really have to have the convictions and as we're working in new technology space I think it's more like a marathon you know than like an actual uh race you know what when you get exhausted your peers also kind of get exhausted so it's when then at that point you kind of um sustain and pers you know like persist that's when you actually get the rewards and same thing for investors so I I adding one more point which is in the bear Market we kind of now see that the Bachelor of 2021. some of the founders are very you know are still very high quality but they're coming back and needing another round of uh investment so we as investors also take a look look at those deals who the founders are willing to keep on going even at this really um difficult stage I took that I just had one quick point to that I really agree and probably the most exciting category of Founders that we've seen in this bull market sorry this bear market so far is experienced web 3 Executives or managers at existing web three companies that see gaps in the way their current companies are approaching it and say you know what I want to build my own thing in a better way or I want to learn from the mistakes we made during the last bull market and um redo that in in a more decentralized censorship resistant way natively and so it's incredibly exciting because I think you know you touched on this where in the bull market you have all these people coming from all over wanting to build crypto projects they've never been to space they don't really understand the culture they haven't really proven their their dedication to the space um but now we see people who have operated for at web 3 companies for one to two years and want to start their own thing and so it's an and it's a category we're actually willing to pay more for because they're EXP experience and just have great set of leadership experiences um and Technical abilities they've just built up during the last bull market for our phone including personally is that there has been more emphasis on gravity I Feel The Narrative of Revenue wasn't that strong when a lot of teams they can cash out tokens pretty quickly but when it comes to emphasis on Revenue it also about like business model and how they manage um so so this narrative is definitely stronger and another thing is that I feel for our team we have spent more time on research on the narratives the new narratives next experience itself it can be say options it can be a new ecosystem and it can also even across Beyond web3 like uh the recently how Ai and maybe underground at others um and I think lastly is uh like echoing about the point touching on the test the founder the background founder um is that we see a lot of web 2 background Founders actually coming in usually they will pair with what three advisors or marketing or Community people so that's for our site so going on the next question um things we touch upon a bear market so and all the investors here have experience of multiple Cycles so can can you share with us like what was your previous lesson in the bear Market comfortable yeah I think I out of all of them are probably the least experienced I started investing in crypto probably 2017 and these guys are probably earlier uh in the Ico stage I think I've learned that hype is not something I should just follow because long and you know you only really uh become a successful investor is when you have conviction and conviction leads to holding Investments for an extended period of time so for me from you know the previous Cycles what I have learned and especially now as more of a consumer web 3 VCS although I do we do have some infra and uh sort of middleware play is that you really have to focus on the problem and the pain point of what these Founders are trying to solve and oftentimes you know uh everyone is very excited and you know jumping right to Solutions and talk about hey this is like the latest uh Tech stack that we have developed you know the fastest the most efficient but at the end of the day what problem are you trying to solve and how realistic is that problem right so I'm gonna use the you know I call it the metaverse kind of hype narrative I don't see any pain point in those uh just yet so taking the same approach looking at this bear Market or you know being in the winter what's going to be most important for me and taking from the lessons is really understanding the problem you know focusing on why are you solving this problem what is so important that this problem has to be you know even more important to be solved now and not like five years later or ten years later so yeah I think you know that's probably my uh my North Star right now as a consumer web3 VCS I think uh for us uh I think the big lesson is contrarianism right is being contrarian I think is super valuable like for example like we LED uh one of the C rounds into openc and at that time like 2019 time frame like there really wasn't any real nft Marketplace to speak of you know we also were seed investors into uh ygg or yield Guild right so the idea that Gabby was pitching is you know what if you had an IGN style kind of gold mining Guild that was owned as a workers Collective or as a labor union right nobody had ever heard of any of those things before so for us like we definitely have acquired a strong taste for contrarian bets right especially when in a bear Market you know contrarianism takes a lot of guts but it definitely has a super high risk reward ratio you know I think Carl was talking about sort of taking bigger swings so I think it's it's properly related probably the most important thing they've learned from investing in prayer markets is gonna be and so I'm dating myself but I started investing personally in 2007 which was a very interesting time to start investing and I remember you know all of the headlines were about like prices plummeting and people getting laid off and it it felt like the sky was falling down and now when I talk to people who are younger and for whom this is their first bear Market they feel that way right they feel like oh my God is this the end and you know from having been through a few Cycles it's not this is ups and downs are a very natural part of Market Cycles it's just like Seasons it comes it goes so I think I'm far more Zen uh now than I was you know when I was younger just started investing and I'll be honest this is my first time being a professional or like as part of a fund in the bear so I don't have I'm gonna keep this really short because I don't have a ton of you know Bears I've been through on the investing side I personally I have but not like in the investors chair um but yeah it's this is the best bear Market to be investing in because all the core metrics are still extremely high you look at you know the trend of developers it's continuing to increase your continuity events like this with fantastic Global developers coming together um that wasn't necessarily the case at such scale during prior bear markets you look at the macro Trends I think my macro perspective uh inflation is still very high it's still going to keep being high globally for a very long time and so a lot of the the narratives around like sound money and just generally not reliant on Central institutions and Central Bankers is more cogent today than it was during prior bear markets so from all the data that we see this is like it we're in a bear Market but it's only that the price is down not that necessarily the fundamentals have changed and so to me it's like almost a it's a really easy being a you know investing in this cycle because we we have such conviction that you know we're going to make it through this but you know I think my advice to teams are in the bear Market is just you know continue to solve developer pain points and get back to basics right like really figure out um your customer your Target customer segment and really focus on attacking that effectively rather than trying to boil the ocean which oftentimes can happen during the bull market and in the bull market you might be able to sustain yourself on hype and other things and the bear you really need to prove yourself via attraction Community growth Revenue some sort of uh key indicator that you are in fact creating value in the economy for me the previous two Cycles have experience the market teaches me to be persistent not only as investors but also when we work with teams together and I think another Point worth mentioning is about the importance of relationships actually Bear Market I feel is the best time that you make friends in the industry and make and know people that are actually still building because it means a lot it takes a lot of character and ability to survive in this market and because you and the industry friend you have been through this whole journey you have some shared a shirt pain or shared memory that when the market finally comes it's the time that you guys can not only earn Financial benefits but also like even lifelong industry Partners so that's my takeaway so zooming in um so what kind of projects are still shipping and who will weather the winter the best move on to the star first kind of uh touching my point that I I mentioned are teams um who initially had pain points to solve for because for for them you know their pain points are kind of the North Star is where they would drive their company is their mission and the vision um I think this assumption has to be set correctly amounts to the founders right when they set this company and saying that hey because all of you know these assumption balls you know fall into the true bucket such that we should solve a problem like that and during the bearer Market you know nothing has changed I mean macro wise and supposedly you know um in crypto in demand supposedly nothing's changed except the prices are going down so for those companies they're shipping you know they're working even harder and potentially even higher some of the um talent that they see from their competitors to join their team um and I think one more thing I wanted to add are founder who has a purpose on why they're doing that I'm going to use an example uh one of the companies that we invest in they're on payment and the founder has been in payment for a very long time so he's deeply interested in the scene of payment unlike you know a lot of people when they're diving into web 3 during the the bull market they're just you know going for hype and they might be building uh you know a consumer app but all of a sudden they're trying to you know do infrastructure and of course they would it would be much harder for them to sustain uh because again this is a marathon so I think you know the teams who have a very strong pain point and even better a personal connections on what they're building those are the team that are shipping um let's remember some of the companies that were built during the last couple of crypto Winters and bear markets right uni swap maker Dao um open C nanson right like these companies were all born during uh Winters and I think in a bear Market you have to have better ideas you have to be genuinely Innovative and genuinely working on something that you're excited to be working on and you're happy to put your head down and keep working on it as long as you have Runway right and do everything you can to extend that Runway Alpha lab Capital our company was started in 2017 about five mark five months before the bear Market set in and all through 2018 and 2019 we just kept our heads down we were a very small team we kept our head count low you know we were just working on our uh working on our algorithms working on our our infrastructure working on technology and when 2020 came around and the market picked back up again we were there and we were ready to go um so I think that's the sort of thing that that sort of attitude that you have to take as a Founder during a bear Market I think uh one of the things that we've started specializing in is really training entrepreneurs on how to raise Capital we think that the ability to raise capital is actually a very strategic Advantage uh we we actually have over 300 co-investors institutional Venture co-investors so you know we've been since we've been around for a little while you know over over almost 80 portfolio companies you know we we really do know a lot of folks in the industry you know and we just feel like that becomes a really useful value at you know something because I feel like this is you know there are people who are amazing at pitching right but maybe they're not great at building their company right whereas like that's something that we can't teach entrepreneurs how to build their company right but we can teach them how to pitch so like you know that's something where I feel like I can add value so you know I'm definitely very opinionated about how to pitch I have a methodology that I call the magic words so you know if you if you can learn it from you know from someone who's actually doing it every day uh you know I think you can get an advantage and you know I think that's a in a bear Market I think learning how to raise is is worth it's worth learning and it's pretty simple by the way yeah sometimes people act you know consumer applications tend to do better in Bull markets than bear markets just because naturally people are more predisposition to get in early and experiment with new opportunities but you know some people ask me should I start a consumer application uh you know during the bear market and the answer is like absolutely like any category of web3 project can be successful during the bear Market um I think the founders need to have more conviction and more passions it's going to be more difficult um than it is during the bear Market it's going to be less sexy less fun but um I think absolutely any type and category can be successful and you know the in addition to raising Capital making sure you maintain the capital you do have you know first-time Founders in particular want to hire a big team uh they want to be able to sponsor events and like sort of live that experience of now instead of being an individual contributor I'm now a leader but you know second time Founders are all about keeping the team as small as possible um to preserve Runway and be able to like actually invest more strategically at specific times or opportunities than just like maintaining a a broad team so cash management number one number one reason companies um fold or die is because they run out of cash so just make sure as a Founder you don't get too overzealous and you keep disciplined on how you use your Runway but that doesn't mean that you shouldn't spend it if you see a good opportunity like double down there but spend wisely yeah I wanted to add on to that point as a previous Founders it's actually important to know when you need to put on uh uh the speed so it it is important to survive but at the same time you you know you're in a race you have to be faster than your uh competitors so yeah pitch sustain and know when to go okay um so how can entrepreneurs continue uh decide to continue to race at a Down Round or to close shop and return Capital to investors I'll start with this one because we had a actually we invested in a company and then two weeks later they got an acquisition offer uh and and so you know they asked us like well should we keep building or should we uh you know sell the company and we asked the founder well do you want to keep building and so I think the answer is if you are still extremely driven about your product like absolutely keep um trying to build trying to Pivot trying to find product Market fit in some way um but if you are not you know if you're like hey I actually am okay with uh you know a small exit or a minor exit and you're sort of that sort of is indicative that you might not be as passionate about this opportunity um and then go ahead and like take that right it's a great outcome good opportunity for you and the core team that you built but you know I kind of put it back on the founder and say well what do you want to do and kind of whatever your heart is just follow follow that but like there's Capital there I think well we'd all agree there's tons of capital out there for really good teams and for really um you know for Founders that have the ability to um you know different differentiate and like think critically about the space and the pain points that they're solving so know there is capital there uh the question is you know do you have the right narrative and ability to raise that capital and do you have enough conviction to continue on the journey because in the bear Market it is a really um hard and sometimes the only Journey I mean I think that the thing the thing not to break is actually like trust right so to me like you know we certainly had multiple cases of basically you know returning available Capital One of the first ones we had there was base coin so base coin returned 94 of investor Capital because they didn't see a forward path right so they were like okay the thesis is broken the thing you invested in it doesn't make sense for us to do so have the money back right so they went on to raise more money you know and like that's a beautiful story right because they didn't break trust right so you know if you're if your thesis is broken you should definitely think about what to do because you know there's definitely second third Innings and you know there's plenty of stories where people go on to do really wonderful things right as long as they don't rug pull their investors yeah and it's really important to communicate with your investors I think there's a question around this so I don't want to say too much but the worst you know I'm hoping or assuming that company was working with you and you had a good view and could help encourage them one way or no other but the worst thing is if a company doesn't write any investor updates doesn't really engage their investors and then they're like hey I'm in a really bad spot and it's really hard because you haven't understood The Narrative of the business what they've tried and so and then it's hard to go ahead and actually like help that founder figure out the best path forward so you know trust with your investors and and you know consistent communication you know we expect things to go wrong in a company that's why we're you know early stage investors there's a lot of risk but we can as investors help navigate that risk if we're in the loop effectively yeah we expect 90 of the company goes to zero so it's it's pretty normal that hits the fan and then you know like we are prepared to help you solve problems and you know I I think echoing on Miko's Point checking your uh initial assumptions on why the company should work and if that assumption has changed you know you can either choose to Pivot to a different idea or you know like base coin return the capital and retain the trust that you have from your investors and and uh a lot of times when you pivot to a different idea uh you could find success and you know almost all the companies wouldn't be successful in the first row but one personal experience is that you know as a ex-founder i pivot it and I found success turns out I didn't like it I didn't want to you know feel what I was building and eventually I sold a company because that's just not you know something I like to do so I wanted to let the founders know that it's okay that you pivot find something you don't like and you know exit or sell the company or shut it down because at the end of the day you don't like what you're building it's very hard to you know get them even for the investors is very for them they're not going to get the Venture return because you don't like it and you don't have the passion in it just to add a positive note right we are still seeing companies raising new rounds at higher valuations and there is you know as Carl was saying there is still Capital out there right so it's not all doom and gloom okay going on for the challenges and opportunities what VCS are looking for as signs of legitimacy meaning how to prove your project is in a slow rock who wants to start with Nicole yeah I mean I think this is really important I think one of the things that uh we do is we absolutely call references and we don't just call the ones that entrepreneurs provide because those are always the best ones like we go off-road and like we try to find out right that I think that's important and this is probably the biggest Alpha that you'll get from me on stage is you need to call references off-road on us right which is you know you you need to know who your who's on your cap table who's investing in you and like one of the things that I think is pretty important about this panel is that we've all founded scaled and exited companies ourselves right this is actually super important because if you just get someone who's only done like maybe b-school and then like investment banking if you tell them what's really going on in your company and how how insane it is they were they're just gonna flee and panic right whereas if any if they've actually built startups before themselves they will have nerves of Steel like they will be like oh yeah I've seen that okay that's fine you know okay we're screwed but maybe we can live you know so so you know figure out who's who you're who's investing in you and like call references on them and go off-road and and call call the people they've worked with who haven't been massive giant unicorn successes right because those are all happy stories like call the ones where it's maybe not so happy didn't turn out so great how did they do I like to use uh a win-win strategy so I do call the reference um but what I really like to do is for example we're doing a lot of like you know uh SAS type of model company now or you know a middleware company I would just send them like a customers uh maybe a portfolio companies of ours and then I would just say like and then I would check with my portfolio and say how how did how did you feel like do you like working with these guys you know because in front of investors they would just say yeah I'll do this that that and and whatnot but when you have a customers in front of your door asking for something and try to actually pay you to use a service that tells you a lot about the team and oftentimes you'll be surprised out of like maybe 10 companies only like really two to three of them deliver and or well two to three of them actually have a good attitude or actually want to work with other companies and maybe one to two of them actually deliver so then I would like say you know that's a pretty good that's a pretty good sign not like you know call it a day but that's a pretty good sign I think in addition to you know personal references which is incredibly important probably the number one thing that we're looking for as uh you know proof of investability is traction right like are you you know are you building products do you have some kind of MVP do you have Alpha customers lined up do you have a wait list signed up are there actual people who want to use this thing have you you know done user surveys do you understand the problem um I think the days of being able to raise on just the deck and an idea that's like bull market right that's not gonna happen here I think another source of really really valuable uh sort of reference calling is actually your past investors maybe not even on this project but on previous projects like those are all super valuable that's the reason why you probably shouldn't rug pull your investors because new investors should be calling the old investors and saying how was it working with this person we actually had an entrepreneur that pitched us and they were like oh you know what we're doing is we're doing a recap right so you're going to come in you're going to get the Lion's Share it's going to be awesome for you and all the investors that are currently on the cap table are going to get screwed do you think we want that like do you think we want you to abuse your past investors so that what you can abuse us next like that's just silly right so the idea that we are we are not zero-sum investors we are positive some investors that's what Venture investors should be and have to be right so the idea that we're going into a win-lose where we're hosing over these other investors like that's just bad like so so you know so I guess what I'm trying to say is you know don't post people you know and and you'll do better so I don't know we were about to do a deal and talk there's a three-time Founder it's like everything on paper looked really good we talked to their prior investors and just heard horrible things so we were about to do a Deal completely passed on the inside of Prior investors that's 100 we've done that too yeah 100 Echo that um on the traction piece um you know I think the other my background is in product and in particular what I really look for is do you have a strong hypothesis about what types of customer segments are using your product and why and in particular do you have user um you know narratives or stories or um you know pieces of feedback that really help guide you like I would much rather have smaller traction number wise you know not a large community but small attraction number wise amongst a dedicated group of users that have not churned and continue to engage with the product then I would like our Twitter is this our community is this we're targeting four different customer segments and they're all like disparate to me that really doesn't show clarity of thought um as as a leader and especially as a product thinker which a lot of times the CEO is early on in these companies um so really just you know something that's important um when we're looking at uh companies yeah I stay away from the vanity metrics because you telling me that you have a million users all of them turn d0 doesn't mean anything to me so focus on real tractions focus on actual engagement and how sticky a small I would say audiences I mean we're all seed early stage investors we don't expect uh you know a million 10 million users I re I very much rather if you have 10 million users probably not you know you could just sustain with a lot of different monetization models I rather very much see like dedicated users and real metrics and by showing that you presenting these metrics and understanding the importance of that really showcase that you are a product owner someone to understand how to scale this Beyond just the early stage and and if you're B2B then we'll absolutely want customer references like we'll absolutely want to talk to 100 so once you give and the ones you don't give very good a friendly reminder that I need to check every number and every customer on your deck because we will go after them so following on the previous question like what can investors actually do to hold Founders accountable I I'd like to throw out this idea I don't know if you guys have done it before but I kind of like stage financing uh sometimes when I don't really 100 especially if I'm leading a deal right like it's a it's a Founder that has not been proven himself but I still wanted to give him a chance because he's really sensible so I'll maybe just throw in like a stage financing super early on round where I'd say okay I'll give you x amount if you you know kind of like well first I'll give you like some initial Capital I'll give you x amount if you deliver the MVP I'll uh give you an another x amount you know if you actually get to Beta so to really get them accountable to and and also oftentimes it helps them to really focus on what they should be focusing on it's not marketing it's not you know this court building a community is really building the product first right and and I don't know I don't know if you guys think that's weird but I kind of mostly capitulate on holding Founders accountable uh I have a pretty different contrarian strategy with respect to that which is that I believe in the I think in the worst companies the investors are driving the car and the founders are in the back seat that's those are the worst companies right uh because you know so it's like if the investors are the adults that's actually bad right what you want is you want the entrepreneurs to be not only the adults and not on the investors mean the kids but you actually want the entrepreneurs to be the parents and the investors to be their kids right so in in a sense like the idea that the investor is holding the entrepreneur accountable it's really for us it's more selection it's more selection which is we want entrepreneurs who hold themselves accountable we want entrepreneurs who are uh you know accountable to the market to their customers right uh you know and so it's it's selection and sometimes it doesn't work sometimes sometimes you select wrongly and you know so the amount of energy it takes to make someone who's not accountable accountable is not it's not worth it it's just not worth it it's like okay that's fail um I'll talk about this from the perspective of a market maker right so something that we saw happening a lot in Bear markets uh sorry bull markets is uh investors you know really pushing their teams to generate tokens very early sometimes before they had a product and then just getting really early liquidity for the investors and the teams I think the narrative around that has shifted a lot over the past year we're seeing a lot of deals change the investment type right we're seeing a lot fewer staffs and a lot more safes perhaps safes with a token warrant but you know investors being willing to take Equity rather than saying I'm expecting you to have a token in you know six to 12 months and I'm expecting to be able to get my money out it's a very different shift in uh in the expectations that are set for what they want the founding teams to do I think uh if you read the book super Founders you'll know that the median time to unicorn is four years right and then it tapers after about 7 seven right and the reason why is for your vesting is standard in Silicon Valley right so why is for your vesting stand if you look at seven year taper seven year taper is actually the second re-up of vesting right so it's two vesting Cycles you're not gonna make it like if you go to longer than that you won't make it so like to me like it's it is really kind of like this type of motivation and energy I think is really important yeah quick side note if any investors pushing you towards a token in six months for quick liquidity do not work with them 100 those fast fast pump and dump investors like you know put put the investors on investing yeah um so on the um I think so Echo everything that's been set up here the other thing is just have a conversation and in particular before you sign the term sheet um one of the things we've seen in our I talked about the importance of investor updates previously 100 we've analyzed our portfolio and the ones that send investor updates have outperformed those that don't and I think for very you know many reasons why that's the case um and I we were kind of talking out as our team you know six man we're like why is it that like investors don't send like I'm really upset this and you know founder isn't sending an update and they were like I was thinking about like well we never told them they should I mean like we told them afterwards but we never said while we were signing documents like look this is what we expect from you as a founder and like how we're going to work together because we it's really a partnership right like we really want to work with these part these uh boundaries and get into the trenches with them but likewise we're going to allowed our expectations you Builder founder 100 should lay out your expectations for what you expect from us right and so whether that's hey you know we really want you to be involved in you know tokenomics help or you know go to market in particular like intros these different types of companies you know be extremely explicit about what you want your Venture Capital investors to do because the worst thing you can do is find a firm not be explicit and then they're not actually solving the pain points that you as a Founder have um so you know just have that conversation both ways and then everyone on the other side of um the investment you know can has a very clear expectation on what they should do okay so going to the final question of today um so what is your outlook for web3 VC investing in the next year like another winter or spring is finally coming I think uh Market timing is extremely opaque so it's very hard one of the things that we've benefited from is actually the four-year Bitcoin halving cycle so you know we've definitely raised funds on the highs and like been deploying them on the on the lows so I think that that's really something to look at uh for me I think we are actually uh we're in a really intriguing phase where there may be Mass adoption coming I actually am pretty bullish about the web3 gaming segment uh you know last year 7.6 billion dollars went into web3 gaming so you know I think we are going to have like a lot of mass adoption coming from that uh investment so I'm pretty excited about that nobody knows I mean like the smartest you know macro investors in the in the world are wrong all the time so I have no idea if it's going to be winner for two more years or if it's going to be uh you know summer uh you know it's gonna be like 80 degrees outside when I walk outside today um what I do know is like we're you know long-term investors so we're not worried about the next six months to a year we're really looking at like where you know what are the underlying fundamentals and like the main again pain points or capabilities that you're providing and that's what we're you know investing in yeah I like to Echo both of what they said you know I think for us uh one of the main thesis or one of the core investment direction is new users um we think currently there is not enough users or new users in the web free space it could be gaming because there's so much money and financing supporting Studio bringing new games I think it's the natural you know progressions of new users and for gamers um they're a mind share of or and switching costs is less than let's say other you know type of application like social um you know they could very much just try it out a new game which happens to be on web3 so it's a natural progression for gaming to pick up a little bit more track but I wouldn't say there's something you know out of the Blues in getting traction so it's like who knows but um for us we're pretty sure that it's not going to be one of the you know 2017 2020 like it's not gonna be immediate adoption it's going to it might very well be like a slow ride you know it's a slow ride up it's a little bit more healthy because you know the fundamentals are getting better usabilities are getting better so I think 2023 on it's going to be actual usage so uh it might not be an overnight success like we have seen in defy summer or icos or you know um previous cycles that we have seen I think regardless of how long this uh crypto winner and the cycle lasts what we expect to see coming out of it is some genuine Innovation and some real solutions to some of the many problems that still exist in the space I think again if you look back at the last cycle and what came out of that right we had MMS coming out of that we had defy summer coming out of that we had you know the nfts and Dows and um all of these things that were kind of at a slow burn for a long time before it took off right uni swap I think was launched in 2018 right and existed for a year and a half before D5 summer took off so um just you know regardless of how long the cycle lasts if you're building something genuinely Innovative and that's solving actual problems you know it'll the timing will come for you okay uh for our fund we will look more into the entrance of Newmarket as well I can be gaming can be social fi uh but specifically for projects that can have a wealth generation effect um so new token economics uh new products per se so yeah our time has up thank you all for the honor panelists I hope you have a good day [Music]