Eric Vishria
speaker
163 appearances
1 recordings
1 series
first heard Sep 2024
last heard Sep 2024
Eric Vishria’s voice in public audio — every appearance, attributed to the second.
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Appearances
I'm probably, at this point, I'm probably 80 or 85% on working on the portfolio. I mean, it's a lot. And part of that's because, whatever, I'm on 12 or 13 boards. I can't remember. But a huge part of it is that is our model. Like, that is the benchmark model. And since the benchmark model is a concentrated portfolio of, like, very high conviction commitments.
Like, we're making commitments to entrepreneurs. It's, like, it's very high concentration and very high conviction commitments. That is the nature of our model. And I think that is... Are you on too many boards?
It is a lot. But I think they're all at different stages. So it isn't as nuts as it kind of seems on the surface because like four or five of them are really young companies, right? That are in their very early days. And like you said, I spend 80, 85% of my time on them.
So it's not like I'm, you know, if I spent 60% of my time looking for new companies, then of course you wouldn't be able to spend that much time on your portfolio.
Our vote system, which is somewhat irrelevant, but it's a way to kind of quantify people's feedback. So a company comes in, we all talk about it. At this point in time, most of the time, there's only five of us, right? So at this point in time, we would have chatted about the company and at least two or three partners would have met typically.
And so there's a decent amount of institutional knowledge about the company. And then at the end, you kind of quantify your feedback. And so it's a way for partners to quantify their feedback to others. And so our voting system is you vote one to 10, you can't vote five. Six and above is yes. Four and below is no. And it's kind of strength of conviction, right? If you get a bunch of 10s, amazing.
I've never seen that happen. If you get a four, like partner's telling you they didn't really like it, but it's not, whatever. If you get a two, your partner's telling you they're really discouraging you from doing it.
I don't know. If your next question is what happens if you don't have the vote and you still want to do it, I have no idea. I don't know what happens.
I don't know that you have to get three out of five. Like I said, I don't know what happens. Benchmarking is a very high trust, like high confidence in each other model and structure, right? Is it always five people saying yes? No, I'm just saying nobody knows what the votes are except the sponsoring partner. And if a partner wants to do something, I think they can do it.
You're getting feedback from your partners who you trust and have confidence in.
I think it is actually useful to quantify things. You get all of this feedback, right? And anybody who votes a six on an investment does it apologetically. They have to be truly conflicting. There's nothing strategic. That's managing politics. That's not managing making the best investment decisions.
Well, I think the sponsor, your sponsoring partner, the kind of advocate probably needs to be that. But your other partners who are looking at it and trying to help you make a decision, I don't know that they have to be that way. They have less information necessarily. And so having their strength of conviction doesn't need to match yours.
Even great companies can be overvalued. One of the things that Bill is really good at is thinking about fundamentals, right? He came from public market investing way, way back when. At the beginning of his career, he has that mindset, that analytical mindset. And so he thinks through that and says like, hey, on a fundamentals basis, you will trade sometime at under 30 times free cashflow.
And so that's a thing. You and I were talking about what's the ARR number and the revenue and all this stuff. But ultimately, you talked about the four areas, which is sourcing, picking, winning, helping build. There's a really important fifth stage that nobody talks about and not every venture capitalist gets to, which is exiting.
And ultimately, our job is to return money back to our investment partners. And so when you think through that, you do have to ultimately, hopefully, everyone gets to a place where they're thinking about this fifth step. Not everyone does. And in that place, you do have to think about these fundamentals.
And so occasionally, you have an amazing company that you really believe in, but it can be overvalued too. Okay. Fenton, what's the takeaway from Peter? The insights around people and motivations that Peter has are unparalleled.
And I've described this before, but like Peter and Bill, one of the things that's amazing about the two of them is they are very, they're very, very different style investors, like almost diametrically opposite in a bunch of ways. And obviously they have a lot of common ground, which is how their partnership was so effective for so long. Peter is very much like people first. Bill is very much
I would say like market first. It's a different mental model in looking at these things.
He told me a version of that on one of the first investments I looked at at Benchmark in 2014, summer of 2014. The discussion was like, well, could you do it at 40 or 60 or whatever? It's like some price. I was like, well, I'd do it at 40 and not 60. And he's like, no. No. That doesn't work. No, it can't do that.
I've said this now subsequently to new partners who've joined in my own way where like, yeah, that's not, you can't, not allowed to make that claim.
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