Ramtin Naimi

I think Sotheby's is about like a $3 billion market cap and it's well over a hundred year old company.

So I think good businesses, not phenomenal businesses.

Their margins are a lot more volatile than one would think looking into it externally.

But I'd say the blue chip galleries seem to have endless pockets.

What they spend money on is beautiful gallery space and making beautiful exhibitions, but they have a cost of goods, which is basically zero and then very, very large tickets and then 50% rev share.

It's a lot easier to identify what is going to be a great company than who is going to be an artist that stands the test of time.

There's a lot more tangible things you can look at.

There's much more fundamental and technical things that you can look at that'll tell you that something is special and something is good.

There is a market for pricing in the venture world that might not necessarily be the case in the art world.

Fair market value is very clearly determined in the venture world.

A company goes out to fundraise, an auction is run, and term sheets are offered and a price is set.

Those things are obviously very different.

Those are the primary differences, is really just venture is a much more tangible, even though it's tangible, there's a lot more to underwrite.

There's an E, not just a P. Exactly.

The simplest way to describe this is how I came up with a thesis for how abstract actually invests.

And this thesis has evolved over time.

But the thesis in which I started abstract was trying to identify which companies have the highest likelihood of becoming power law companies.

And I identified power law by any companies that had a private market cap or exited north of a $5 billion valuation.

What I'd realized over time was that if you eliminate Uber and Roblox from the equation, whose seed rounds were led by first round capital, it's close to impossible to identify power law companies in which the seed round was led by a seed stage venture capital firm.

This has changed in recent years, which is why our strategy has also evolved.