20VC: Why It Is Good Company Funding Has Been Down 6 Quarters In A Row, Why Unanimity Does Not Work In VC Decision-Making & Why It Is Dangerous To Be A Spreadsheet Investor with Scott Raney, Partner @ Redpoint Ventures

**Harry Stebbings** (0:00)
This is The Twenty Minute VC with your host, Harry Stebbings, and I'd love to see you on my favorite platform, Snapchat, and you can find me there on at hstebbings. All ads get a personal message from me. However, to the show's day, and I'm thrilled to welcome Scott Raney to the show. Now, Scott is a partner at Redpoint Ventures, one of the Valley's leading multi-stage funds with over 434 investments, close to $4 billion in assets under management, and 136 IPOs and M&A. At Redpoint, Scott's made investments in some incredible companies, including the likes of Twilio, Stripe, and Heroku, just to name a few. Prior to Redpoint, Scott was responsible for new products at NorthPoint Communications, and before that, Scott worked at Bain & Company, helping clients in the private equity and technology industries. I do also want to say a huge thank you to both Tom Tunguz and Ryan Sarver, both previous guests on the show, for the intro to Scott today, without which this episode would not have been possible. But before we dive into the show, say I really want to talk to you about a company that's really changed the way I sleep and operate. Eight is a sleep innovation company, with their latest product, the Eight Smart Mattress, being a bed that literally tells you how well you slept last night, paired with an intelligent sensor cover that measures the quality of your sleep and delivers a daily sleep report. In order to bring you the best product, Eight used anonymized sleep data and feedback from over 10,000 people to understand which materials and types of mattresses give customers the best sleep, resulting in their unique blend of four responsive and high-density foam layers, plus one layer of proprietary technology that helps people track and improve their sleep. This is perfect for people like me, people who want to be more productive during the day, who use or have used a fitness tracker and want to take care of their health and fitness and sleep. And if that is you, honestly, you have to check it out on eightsleep.com. And if you use the promo code 20VC, that's 20VC, you'll get a whopping 20% discount. And with Eight keeping me productive with a home product, FullContact is keeping 20VC team on top form. With FullContact, they provide the ability to organize your contacts, gain rich insights into them, and therefore build deep relationships. With features like automatically identifying and merging duplicate contacts, to the ability to snap a photo of a business card and FullContact will transcribe them for you, so no more lost and loose business cards at events like I always suffer from. It's with these features, just being the tip of the iceberg, that FullContact really is the best all-in-one solution for contact management. And it truly has changed the way I not only manage my contacts, but engage with my contacts. And you can check them out on fullcontact.com. But it's now time for me to shut up and I'm delighted to hand over to Scott Raney, partner at Redpoint Ventures.
You have now arrived at your destination.
Scott, it's such a pleasure to have you on the show today, having heard such great things from both Tom, Ryan and Mahesh.
So I really appreciate you taking the time out to join me today, Scott.

**Scott Raney** (2:48)
Well, thank you for having me, Harry, I really appreciate it.

**Harry Stebbings** (2:50)
But I'd love to get started, though, by discussing a little bit about you and how you made your initial entry into the wonderful world of VC.

**Scott Raney** (2:57)
You know, I got a headhunter call many years ago, and it was always something that I was intrigued by, but I wasn't sure whether or not at that point in my career was the right thing to do. But I went in for a series of interviews. I had a chance to meet the Redpoint team and really fell in love with them and kind of made the decision to make a commitment to it early in my career and kind of stuck with it through the ups and downs over the years. And I really found it to be an incredibly rewarding experience.

**Harry Stebbings** (3:20)
Can I ask, what have you gained in terms of perspective from seeing the many cycles? I'm often told as a young investor today that the true greats have really seen the market cycles and how it affects the startups. What have been your perspectives from seeing the cyclical nature of the industry?

**Scott Raney** (3:35)
There's a lot that you can learn. I would tell you though that I think that's overplayed a bit. I think that the times have changed and evolved. The nature of startups have evolved quite a bit. And so I think it's very, very, it's dangerous to try to apply too many lessons in the past to the market of today. And so one great example, I think it costs far less to start a company and get it up and running today than it ever did before. And so some of the challenges associated with fundraising environments during downturns before are probably not quite as applicable as they once were. That having been said, I think that you can see when there are hype cycles building, when there is a rational behavior that's working its way into both the entrepreneurial community and the investment community. And it's always good to have the perspective to understand that these things don't last.