Del Johnson

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Del Johnson

Del Johnson

@DelJohnsonVC

"The Most contrarian thinker in VC" & Father of Modern Venture Capital. VC, Angel, LP. prev: @Google @Oracle @ucberkeley @Columbialaw

New York, NY 参加日 Eylül 2012
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Del Johnson
Del Johnson@DelJohnsonVC·
@mhlakhani @ZaidJilani @VCBrags U.S. Venture capital hasn't been able to outperform European VC for the past 20 years. The Thiel Andreessen generation of VC took one of the greatest engines of economic growth and American ingenuity, and turned it into an old world rent extraction scheme. wired.com/story/to-save-…
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Avi Asher-Schapiro
Avi Asher-Schapiro@AASchapiro·
DOGE handed out SWAG for a nuclear start-up that had become an admin favorite: Valar Atomics, backed by Anduril and Palantir execs. (Here’s the Valar CEO wearing the hat that was handed out 👇) The NRC was then ordered to re-write thousands of pages of safety rules.
Avi Asher-Schapiro tweet media
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Dan Gray
Dan Gray@credistick·
@DelJohnsonVC @Curiousjorge65 @bznotes @bryce Like if your fund manages major public capital (pensions, SWF, >$250M) it must disclose LP relationships, positions and aggregate performance quarterly so the public can see what’s happening with their money and which firms are in bed with which governments? What a good idea.
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Del Johnson
Del Johnson@DelJohnsonVC·
@Curiousjorge65 Yeah, but when you pencil that statement out, you realize that the sizes of exits needed to make mega VC such a massively outperforming asset class, would involve rearranging fundamental aspects of societal governance up to and including disrupting the LP orgs themselves.
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Del Johnson
Del Johnson@DelJohnsonVC·
@Curiousjorge65 @bznotes @bryce LP investors want friends and political allies more than they want to make money for their organizations. They want to do as little work as possible, which usually means hurling the largest amount of capital at the biggest funds with people they recognize from the internet.
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Miles Dieffenbach
Miles Dieffenbach@Curiousjorge65·
@bznotes @bryce It’s more nuanced. Long term VC LPs have had no liquidity for 4 years so they can’t really at scale commit to new funds. Net new LPs are SWF and pensions and will never commit to small and new managers.
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Dan Gray
Dan Gray@credistick·
@Curiousjorge65 @bznotes @bryce They might be more interested in a FoF product if it weren’t for the prevailing narrative? (And if there were more competent FoFs, which may be another bottleneck.)
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Pat McGovern
Pat McGovern@pw_mcgovern·
~90% of VCs at mega funds have their seat because they worked at or sold a hot SaaS co. But now they are all about the atoms, defense tech, manufacturing, etc. given the SaaSpocalpsye. Shouldn’t this require a 90% refresh of the investor class to meet the problem set at hand?
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Del Johnson
Del Johnson@DelJohnsonVC·
@mattyglesias A proposal that would help the situation substantially is to use policy tools to encourage VCs and their companies to disperse more evenly throughout the country. We could also do more to seed regionally diverse funds and startups with no pre-existing ties to extant SV networks.
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Del Johnson
Del Johnson@DelJohnsonVC·
@mattyglesias The issue is substantially philosophical. SV tech leaders, especially VCs, believe more in ideological sorting and "pattern matching" over regional affinity. Naturally, locals don't want to cede power to people who have supported displacing locals. newrepublic.com/article/180487…
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Matthew Yglesias
Matthew Yglesias@mattyglesias·
This is the problem, from a national economic perspective, with coastal housing scarcity — the population growth should be happening in the places that are richer but instead the reverse is happening.
James Medlock@jdcmedlock

It's actually worse than I thought. Catch up growth assumes red states are growing faster on a per capita basis, but they're not. Hanania's charts were not per capita, so basically just measuring population growth. Red states are poorer, but they are also not converging.

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Del Johnson
Del Johnson@DelJohnsonVC·
Talk about a lack of self-preservation instinct. Anyways, just a little more ratcheting up the economic pain on the founder and EM class and we'll move on to the next phase...soon.
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Del Johnson
Del Johnson@DelJohnsonVC·
Decline in the # of pre-seed deals is exactly what most founders wanted. They wanted all the money to go to insiders like Sam Altman and not themselves. I know this because when I said network based investment would lead to deal count decrease they said that's just how it works.
Arjun Dev Arora@ArjunDArora

In this chart from Carta you can see a clear decline quarter over quarter in the number of pre-seed instruments or deals, but the cash portion on the bottom is steady. What this means for founders is fewer startups are getting funded, but the winners are getting bigger checks.

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Jaya Gupta
Jaya Gupta@JayaGup10·
why are there no competitors yet to TBPN
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arian ghashghai
arian ghashghai@arian_ghashghai·
@davidu well in that case your firm has done a lot of deals with someone that you’re patronizing for evidently not understanding “venture capital” :)
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arian ghashghai
arian ghashghai@arian_ghashghai·
70% of *VC* profits made from 3 companies that are not actually profitable businesses makes my head explode
Meghan Reynolds@MeghanKReynolds

Heard from LPs this week: The past 9 months have felt like groundhog’s day - a very small set of deals dominating all LP convos. The fever pitch to access rounds of OpenAI and Anthropic by LPs (and even GPs calling us) at times - has reached levels I’ve never seen in my career. And for good reason. Our rough math suggests that the VC investors’ gross profit on 3 LLMs currently equates to ~70% of ALL VC profits from the previous decade. “This time it’s different” mostly applies to the concentration - never has a tech super cycle declared such a small number of massive winners in such a short amount of time. The LP conversations are now shifting but we’re still on the same companies. LPs now preparing for IPOs and the LLM transition to public mkts - how to access at IPO, how the stocks will trade, liquidity dynamics, etc. 9 months from now will our convos still be focused on the same small group of companies??

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Dan Gray
Dan Gray@credistick·
It's hard to find a better example of what venture capital should look like than @1517fund. @DStrachman and @William_Blake have been the first believers in many of the greatest and gnarliest tech success stories. The source of their power is a philosophical rejection of lazy thinking. Essentially, if the greatest entrepreneurs are outliers, patterns and credentials must therefore be irrelevant. It sounds simple, but living that principle as an investor means sailing into headwinds. There's no simple narrative to sell LPs, the future is never clear, capital coordination is difficult, and your capacity cannot endlessly scale. It's the harder path, but it's the only true path to greatness as a venture capitalist. Success is extremely idiosyncratic; there are no shortcuts. You might reach this conclusion by studying the library of research on venture capital. Or, you could reach it much more quickly by just meeting a few of 1517's portfolio companies.
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Del Johnson
Del Johnson@DelJohnsonVC·
@deanwball Merit is bad in the eyes of Silicon Valley because the truly meritocratic may not be aligned with their secessionist vision of the future, and have the talent needed to subvert their vision. Therefore, SV is organized to stifle merit via patronage.
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Del Johnson
Del Johnson@DelJohnsonVC·
@deanwball Cronyism is the goal, so they can lock up more capital in their network in order to eventually create their own state with their own monopoly on force, in contravention of Constitutional principles. x.com/DelJohnsonVC/s…
Del Johnson@DelJohnsonVC

The massive concentration in VC funding shown here is what I warned what would happen if VC remained a game of "who you know," but most founders wanted to play the "relationship" game Relationship funding leads to money being invested based on cronyism and nepotism, not merit

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Dean W. Ball
Dean W. Ball@deanwball·
I think I finally put my finger on what shocks me so much about the so-called New Tech Right’s willingness to throw Anthropic under the bus and ultimately it is the abandonment of merit. Silicon Valley was once defined by “the best wins, absolutely,” but no longer for they who affiliate with the New Tech Right. For them, “the tribe wins, absolutely.” The merit value was like, their thing. Remember the summer of 2024 and the DEI posting? Where did that go? I never expected these guys to be political theorists or philosophers but I didn’t expect them to abandon that principle so readily, to throw it out the window in favor of chasing taxpayer-funded equity infusions and contracts that are piddling even by the standards of the MIC. DC may well be the toughest U.S. city of them all. It chews up and spits out all kinds of meat.
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Dan Gray
Dan Gray@credistick·
There's no such thing as a top tier seed round. Analysis at Series A shows very little correlation between round size and ultimate exit value. Seed would be even less correlated. Research also shows that VCs typically overprice and overpay for the wrong signals, like category heat and shallow founder credentials. This inflation turns venture capital into a relay race with an increasingly heavy baton.
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Harry Stebbings@HarryStebbings

LPs love the idea of the 30M-75M high ownership seed fund. These will be the worst performing funds of this vintage. Average top tier seed rounds are $5M. These funds don’t have enough to lead and have a diversified portfolio. But they are too large to be collaborative and work with the best leads. Adverse selection takes effect. Be small enough to collaborate (sub $20M) or be large enough to lead ($100M+).

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Mercedes Bent
Mercedes Bent@mercebent·
Wow. only ecosystem with worse concentration of capital is VC firms 🙃
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Del Johnson
Del Johnson@DelJohnsonVC·
@jluan Interesting even as a mere fictional thought experiment. Of course it would make sense to close any loopholes that would allow private enterprises to be able to do anything like this. I could see someone becoming very rich being the expert on prevention.
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David Luan
David Luan@jluan·
apparently this is what the chinese AI ecosystem thinks our grand american AI master plan is! (this is not a joke! forwarded to me by an attendee at a real chinese ai conference!)
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@credistick @Curiousjorge65 @bznotes @bryce @pw_mcgovern @mattyglesias @JayaGup10 @AlexanderSoros