Neil Mehta
speaker
321 appearances
2 recordings
2 series
first heard Apr 2025
last heard 4 May
Neil Mehta’s voice in public audio — every appearance, attributed to the second.
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recordings per month · last 12 monthsRecordings per month over the last 12 months — 1 in all, peaking in May 2026 with 1.
Appearances
I'm so glad we did. I'm so glad we became a high growth firm again.
I think it starts well before a first meeting. I think it starts with figuring out why you wanna meet someone. Why are you differentially great for that person to meet? What do you understand about that business? What do you understand about that opportunity? For a vast majority of what happens in our market, we and I are not the right person to have that first meeting with.
But there's a select number I don't know how many meetings happen in our markets. It's tens of thousands at this point. There's probably 200 that happen a year where we think we'd be a differentially great partner to that person and we know it well in advance. And so we prepare an incredible amount before that first meeting. I don't mean like go on the website and use the product a little bit.
Our first meeting should feel more like a fifth or sixth meeting, the founder, rather than a first meeting. It allows us to go much deeper. And the things I'm looking for... If someone just asked me, I'm going to give you a tangential side. Usually I like to visit a company rather than them come to us, which is also counterintuitive because you can do less meetings if that's the case.
So I love to go visit. And I'll give you a battery of things I'm looking for. But if you put a gun to my head and you said, there's only one thing you could ask this company or people at this company. And I never actually ask it, but I always think about it right away.
is when I visit a company and I watch people and I meet people, I'm trying to evaluate just one thing, which is if you polled everybody at this company and you asked them, are your best days ahead of you or behind you? What would the proportion of people say? And especially the most important people. It's not year over year growth. It's not margins. It's not strong form competitive advantage.
It's not JDC. All of those things matter. But if I picked one thing very early on, even in the startup, you could tell if the energy is not there, I'm more excited about the future. I mean, I just was in Europe a couple of weeks ago. A vast majority of people for it seems like 40 years have believed the best years are behind them, not ahead of them.
If you were running a company, that's the one stat you should care about more than anything else in the world. When I spend time with a founder and I'm talking to them about their business, I'm trying to figure out, are they high-focused, high-ambition, determined?
Do they have divergent thinking that allows them to see something in the world and in their business that other people would overwhelmingly disagree with but is right? So it starts with the founder, personality of that founder. And I haven't been able to sit down and write on a piece of paper I think every great founder looks approximately the same. Every bad founder looks different.
You know, there's some quote about- Yeah, that's exactly. This is controversial. I do believe there's an archetype for a great founder. And I think that once you see it and learn it, it's a repeatable process. And I think some of the things I mentioned are part of that. I think that you're looking for usually someone that's built a jaw-dropping customer experience.
That's why we invest at the stage we invest in. Because it takes some time. It takes some time. It takes some time to get that experience right, especially in things like infrastructure SaaS, where at the beginning, the infrastructure process is not that good. It just takes time to get the product into a performance level where it can actually delight customers. Consumer is a little bit different.
You could feel it right away. We're looking for defensibility in that. What technical or operational trade-offs have you broken that allow you to have the early signs of a moat? We're looking for competitive advantage. We have network effects, shared scale economies, counter-positioning, quartered resources.
These are just adjectives we use to describe the characteristics of a business that allow it to produce unfair amounts of free cash flow over a sustained period of time. I tell this to our team all the time. I think with Buffett, you could sell 30 points of IQ and still be great. I think with us, you could sell like 40 to 50 points of IQ. It is not complicated.
It is the discipline of only looking for those types of businesses and those types of founders. There is no secret sauce. It's just consistency, consistency, of doing that over and over and over again across thousands of companies.
Yeah.
I think what's happened over the last 10 years in particular, but it's been happening for a while, is when I grew up in the industry and you drove down Sand Hill, there's like six firms. And the way the process worked is you'd walk into someone's office, and usually someone was famous. You'd be a no-name entrepreneur. You tell them your idea. They kick it around for a while.
They do three more meetings or maybe four more meetings. There's this great Elon Musk quote, which is, Every manufacturing process is wrong. Every production process is wrong. Every design. Yeah, I won't get exactly right. Every design process is wrong. It's just a question of how wrong.
Because the likelihood we could have envisioned all the available capabilities that we have today when we design that process is zero. Like, you know, so many things have changed. I think our industry is a little bit like that. You're going from this process where people would take a little bit of time. They wouldn't really know your company when you walk through the door.
Now, we've gone from a cottage industry into a large-scale asset class at this point. And I think there are a lot of firms, correctly so, that believe venture at scale, venture with lots of capital, lots of companies, lots of coverage, lots of AUM, lots of people, is the right way to prosecute it. And I think they're right because...
I'll get to why we're doing it differently, but I think they're right because why should people have earned 35 net IRRs for the course of many decades? That's too high for any asset class. It should be in the teens. And usually you could deploy a lot more capital and a lot more people and bring down to the teens and still have lots of people excited about the way you invest.
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