Venture Secondaries: 3 Steps to Escape the 12-Year LP Liquidity Trap
episode
Making Billions: The Private Equity Podcast for Fund Managers, Alternative Asset Managers, and Venture Capital Investors
48 min
1 speaker
3 chapters
transcribed 1 month ago
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Transcript generated automatically by AI and may contain errors.
What is the quiet liquidity crisis facing LPs in venture funds?
If you're managing a fund right now, there is a quiet crisis building inside your investor base, and most managers will not see it until it's too late to fix it. A former PayPal and eBay CFO who has structured over a billion dollars in financing just revealed the exact system for buying into the world's best deals for VC funds at up to 70% below market value. And how to give your own investors a liquidity exit before they start demanding. The managers who understand venture secondaries right now will have an unfair structural advantage over every fund that does not. This is that conversation. All this and more coming right now. Here we go. Come on, welcome to the show, man.
Thanks for having me, Ryan. Great to uh great to be here.
Yeah, it's great to have you. Um, I have been so impressed with your background as CFO of eBay, and you worked as part of the PayPal mafia as it's so uh the affinity term. It's really good to get in here, and we're gonna talk about venture and and uh secondaries and and really everything that you've been able to do, man. So I'm excited to talk about this. So so let's dive in, brother. You went from writing the first draft of PayPal's S1 to CFO at eBay and Sonos and to CO. COO at 500 startups, overseeing 500 million AUM investment committee, to founding now practical VC. Every step of that career was a deliberate acquisition in skill. So for the fund managers who are listening and trying to build their own credibility and track record right now, what would be some of those specific sequence of moves that you would tell them to start accelerating their process starting today?
Well, you but you make it sound very uh very linear and and very logical. In reality it wasn't quite that. I'll tell a bit about the jury and how it went from one to the next and you know what lessons that might have. I don't really know if there's a single way to get to where you want to go to. It's the being a venture manager is a role that's not really path dependent. I think it's an accumulation of skills along the way and when you're when you're at the point where you can manage money you sh you should be able to do a few things like evaluate investments. It's gonna entail a bunch of fundraising skills. And there's a whole ad administrative side of the business too that is really important in managing money.
My my background was I began on Wall Street. I think if you'd asked me when you when I was sixteen years old, I grew up in Toronto, where do you want to be? I always said I want to be an investment banker. I want to work on Wall Street, I want to work in New York. Uh why do you want to do that? I'm on Well, I pr I love Michael Milken. I was enthralled with the American finance. Uh I was good at math. I was good at economics. Michael Milken was one of my heroes growing up. And so you kinda follow what you want and follow your passion and that's where my passion led me through Stanford undergrad, studied economics, ended up on Wall Street. And then from there the I the I think if you'd asked me when I was twenty four what do you want to do, I would have said that I probably want to stay an investment banker, but
The rules that most of the Wall Street firms at the time was like go and get a graduate degree. So I did from Harvard Law School. Came back thinking I wanted to be an investment banker and Peter Thiel talked me out of it. I've met Peter undergrad at Stanford. Happened to happen to meet him. He happened to start a company called PayPal while I was in law school and he talked me into leaving that track into operational finance. I learned a ton in operational finance. I learned a ton on Wall Street. I think if I'd advise any if I'd advised my daughter getting into she's now fifteen, but in seven years she'll be graduating from college and she says, Hey, what should I do? I'd be like Well, if you want to be an inventor, running a company has a lot of, you know, difficulty and complexity.
If you want to be learning from the best, I think starting at a company where you're gonna be around the best and learn from the best has a lot of value.
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Chapters
3 chaptersSpeakers
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