Shark Tank with Thatcher Bell and Taylor Greene

**Patrick O'Shaughnessy** (0:04)
Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_3** (0:24)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (0:49)
We've always found that even in public equities, you learn more once you have a live portfolio. One of the best ways to learn is to put some capital at risk. To learn more about the venture capital world, for example, I made an investment in a startup called Ladder, a platform business which connects coaches, fitness trainers to begin with, with consumers who want or need a coach to help them improve their fitness and their health. The idea is by making the entire coaching system more efficient, Ladder can provide consumers with a real person as a coach but at a fraction of the cost and provide coaches with both new customers and a much better way of managing their existing business. If you're interested in the backstory of this business, you can listen to episode number 60, the podcast with founder Brett Maloli and his story of the vision for Ladder.
We are now six months into the launch of the business with thousands of users and coaches on the platform and run rate revenue passed a million dollars. What I was most curious about at this stage, aside from building something useful of course, was the relationship between a startup and institutional venture capitalists who are allocating capital from their funds into startups at various stages. For this episode, I asked two VCs to sit down with me and Brett and treat the conversation as they would a normal pitch meeting, so that we the audience can get a peek into their world and the types of questions that they ask. The venture capitalists in question are Thatcher Bell of CoVenture and Taylor Greene of the Collaborative Fund. Both have experience evaluating new companies, but also have specifically spent time on companies like Ladder, which follow the platform or marketplace model.
While we do cover a little bit of background on the company, I've edited most of that part out so we can talk mostly about the business model itself. While I don't spend much time talking in this episode, you'll hear me asking Thatcher and Taylor some questions to better understand why they care or don't care about certain aspects of a business.
Lastly, I love the data aspect of all this. The interactions between coaches and customers produces a wealth of data of different types, all of which is analyzed and used to improve each aspect of the process. To help gather more data about onboarding, working with a coach, and tracking results, Brett and the Ladder team set up a little promo code for our listeners, which can be accessed by going to joinladder.com and using the promo code ILTB, as in Invest Like the Best 2, ILTB2. So let's dive in. The first voice that you'll hear is Thatcher, and the next person asking questions is Taylor. I began by asking Thatcher to give us a bit of background on how he approaches young companies before diving in with questions of his own.

**Thatcher Bell** (3:12)
Most of the time when I'm making investment decisions, I'm working with a group of founders and assessing their ability to attack a new market and go tackle an existing problem or opportunity before they've launched a product in many cases, in almost every case, before they have any significant revenue. Marketplaces from my first startup gig have been a favorite of mine. They are sometimes challenging to get going. I think of them as flywheel businesses, so you probably heard that term before, but there's a lot of activation energy to get a flywheel going. In undergrad, I was a mechanical engineer, so mechanical analogies make sense to me. It's a lot of activation energy to get that going, but once it's going, good luck slowing it down. There's a lot of energy you can store in there. And so I have been fortunate to be around and invest in marketplace businesses of a variety of types, both facing businesses and facing consumers, and have also touched a couple of businesses in the fitness space, which is where I know your business is, and so we can talk about that a little bit too. I know Patrick, you talk a lot about looking for systematic advantages and approaches to investing.