Lucas Swisher

People have made a lot of money in vertical software over time.

Think about Insight, right?

They've had incredible exits in vertical software over time.

Multi-billion dollar exits.

In today's world, if you have a big fund, I don't think that's where you should be focused.

I think you should be focused on the absolute mega outcomes, the platform companies that are going to generate that disproportionate return, and you're actually going to get liquidity out of.

No.

A 3x is not enough to be exciting.

And the math is really simple, right?

Say I'm a fund and I'm CO2.

I want to make a 3x net return for my investors.

Sort of the baseline for what people would say is like a top quartile return, and people get really excited about 3x net return for a fund, 25% net IRR, something around those bands.

I'm going to have some things where I swing and I miss.

Say I have a 1X, I need a 5X on the other side of that.

Heaven forbid, I have a loss and I have a zero.

I need a six.

We obviously really try to avoid those, right?

If I have a two, I need a four.

So for me, I need to see a steady case where you can get that 3X.

But I really need to believe that if the company 3Xs, I want to put more money in because it can 3X again.