Matt Grimm
speaker
244 appearances
1 recordings
1 series
first heard Nov 2024
last heard Nov 2024
Matt Grimm’s voice in public audio — every appearance, attributed to the second.
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Appearances
Yep, yep. And there's a fair amount of kind of noise in the secondaries about an SPV of an SPV of an SPV.
SpaceX had a similar thing. They still do have a similar thing, right?
Is it something you want to lock down? two sides of it. They're kind of conflicting. On the one side, I'm like, yeah, secondaries are a good thing. You want these folks to be able to have that freedom. And it's worth noting that every time we've done one of these structured tenders, we've had a relatively low participation rate in them.
Somewhere in the 30% range of the percent of shares that could have been sold, that were eligible to be sold, that folks actually did sell. So a fairly low blended average of folks who are selling their shares off, which I take as a great sign that employees are very excited and very long. The inverse of that is the chaos of the secondary market.
And I think my reputation for hating the chaos of the secondary market is pretty bad. pretty well deserved. I think there's a lot of what I would describe as pretty scummy behavior that happens in the secondary markets where... What is this scummy behavior? So these SPV brokers, they are operating with very low information.
Like Andoril has never once ever approached an SPV broker and said, hey, here are detailed financials. Here's our detailed strategy. Let me avail our management team for different interviews or different kind of kind of sessions. They are operating off of a very limited set, basically headlines, which are almost always wrong.
And then turning around to investors who are either desperate or just kind of carefree and saying like, I got an opportunity to invest in Anduril or SpaceX or OpenAI or whatever other kind of hot company that they've been able to wiggle some access into. Here are a couple of headline numbers. A lot of those investors don't understand the fee structures that they're getting into.
A lot of those investors don't understand even the structure of carried interest and what that looks like. And so what is fundamentally happening is you get a representation of bad numbers to
relatively unsophisticated investors on the other end who are paying pretty steep premiums to what we would describe as the fair market price with usually pretty ugly layered fees on that with, in some cases, pretty material misrepresentations. And we've seen some SPVs going around to folks who are fundamentally lying about what shares they have access to, what vehicles they're investing in.
financial crime you're like misrepresenting 100 it is yeah 100 it is and when we've when we've seen it we've we've called folks out and said hey that's just not true the most classic of which is where someone says oh we have direct access to andro primary shares of their last round there was something going around recently of somebody who was like we have access to the second close of Andral series F raise and it's like the hell are you talking about there is no second close the round has been closed for four months this is
done so if what you're saying is like you're buying shares from somebody who did invest okay then say that but that's not what they're saying what they're making it sound like is just a totally fundamentally different position to what extent is the onus not on you for that so if i take for example nicola at revolute yeah he has fucking controlled that cap table just watertight yep we've tried we've tried and to a
I can't totally control – you certainly can't control fraud. Fraud is going to exist. And I can guarantee that someone out there believes that they invested in their former roommate's boyfriend's SPV and own SpaceX shares or Android or OpenAI or whatever else. And actually what they're doing is they're funding that guy's coke habit in the Bahamas or something. Guarantee that stuff's happening.
And it's like – Can't control that. What we can control is who has direct access to the cap table, who has direct access to Andral strategy, who has direct access to Andral financials. And beyond that, we kind of can't control some of it, to be honest.
Yeah, you can't tell me ahead of time. That would ruin the surprise. My answer would be twofold. I think first we have unlocked what was a kind of a latent patriotism within the technology and defense sector. I say latent because if you look at the momentum through the kind of the early 2000s into the 20-teens,
The momentum in the tech sector amongst kind of the zeitgeist, amongst the employee kind of mindset was not one of patriotism. And to your question, you know, a half hour ago, whatever, like, are the best and brightest going to work at Lockheed, et cetera? Like, no, there was not an interest in working in the defense sector.
And I think like Andrel has unlocked that kind of latent talent to wake up and come work on problems that we view as the most important problems facing the world right now. We've unlocked that. The other half of that kind of card there is also by unlocking an incredible amount of funding and investment into this sector that had also been historically kind of lacking for this kind of segment.
And to your point about like, well, isn't this a bad customer? Like I'm used to winner take all. That's a lot of investors. And that's a lot of kind of traditional VC style investing where you're thinking about the next ad tech company or the next social media platform or something. And like, cool, I get it. Fine. Power to you. That's not this sector.
And thus through the 2000s and then into the 20 teens, investors weren't investing in this area. And I think that like we were able to both unlock that investor enthusiasm and then pivot that into unlocking this latent kind of patriotism in the tech talent base and be able to align the two of those on this mission set.
And ultimately, like at its absolute core, I know this is going to sound cheesy, but like at its absolute core, like a company is made up of their people. If we can get the most motivated, the brightest, the hardest working talent to work on these problems, then we will get good results.
Ultimately, I'm a little nervous about a lot of these companies kind of getting over their skis and then getting one or two fundraisers under them and then realizing it's a lot harder than it looks on paper and ultimately struggling and probably imploding.
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