# VC10X - Building a $1.5B VC Empire on Individual Investors: The Alumni Ventures Story

An episode of [VC10X - Investing, Venture Capital, Asset Management, Family Office, Wealth Management](https://invisiblenetwork.ai/podcast/1632806986), 5 Aug 2025, 55 min.

Audio: https://anchor.fm/s/a453ddd4/podcast/play/106472778/https%3A%2F%2Fd3ctxlq1ktw2nl.cloudfront.net%2Fstaging%2F2025-7-5%2F405156091-44100-2-6c0e06ea3e20b.mp3

Today we're joined by Mike Collins, founder and CEO of Alumni Ventures, a firm that's quietly built one of the most unique and successful venture capital models in the industry. Mike has scaled Alumni Ventures to over $1.5 billion in assets under management by doing something most VCs thought was impossible—building a venture firm primarily around individual investors. ⭐ Sponsored by Podcast10x - Podcasting agency for VCs - https://podcast10x.com Alumni Ventures website - https://www.av.vc/ Mike Collins on LinkedIn - https://www.linkedin.com/in/mike-collins-362100/ 🎙️ Hosted by Prashant Choubey Follow Prashant on X - https://x.com/ChoubeySahab Follow Prashant on LinkedIn - https://www.linkedin.com/in/choubeysahab In our conversation, Mike shares: - How he validated and scaled Alumni Ventures to over $1.5 Billion in AUM & over 20 funds - Network-driven approach to deal sourcing and value add - How their referral network generates 3.2x multiples on invested capital - How a team of 45 investment professionals manage over 20 funds - His bold predictions about the profound period of innovation and disruption we're entering & lots more.. Timestamps: (00:00) Introduction (03:27) Mike's background and early career in venture capital (10:32) Finding product-market fit for Alumni Ventures (14:47) Organizational structure with 10 investment teams (20:24) Investment decision-making process (21:30) Referral network and deal flow generation (25:14) Flat fee model and LP alignment (30:16) Investor base composition (33:38) Potential expansion to institutional investors (36:19) Operational challenges in scaling the firm (39:08) Current venture ecosystem and AI's impact (42:42) Liquidity and exit strategies (48:37) Investment sectors and regions (51:04) Investment stages and check sizes (52:19) How founders can connect with Alumni Ventures (54:02) Closing remarks and wrap-up For sponsorship or guest appearance requests, write to prashantchoubey3@gmail.com Subscribe to VC10X on Youtube, Spotify, Apple Podcasts.

## Transcript

[0:00] The very best deals find their way to the very best venture
[0:05] capitalists. We have over 11,000 individual
[0:09] investors. We have a community that is now
[0:12] hundreds of thousands of people, many of them are alumni of you
[0:17] know top schools or people in position of important business
[0:22] jobs. So we can really help our
[0:25] portfolio companies by making connections.
[0:28] We have kind of a Rolodex on steroid.
[0:31] We are at the beginnings of a very profound period of
[0:36] innovation and disruption and are kind of a reshuffling of the
[0:42] decks and potentially 10s of trillions of dollars of
[0:48] productivity value creation. Well, I've never seen technology
[0:53] that is this powerful and this broadly impactful and moving
[1:00] this fast. Hey everyone, this is Prashanth
[1:04] and I'll be your host for the VC10X podcast.
[1:07] And today we have Mike Collins with us.
[1:09] Mike Collins is the founder and CEO of Alumni Ventures, a firm
[1:13] that's quietly built one of the most unique and successful
[1:16] venture capital models in the industry.
[1:18] Mike has scaled Alumni Ventures to over $1.5 billion in assets
[1:23] and management by doing something most VCs thought was
[1:26] impossible. That is building a venture firm
[1:29] primarily around individual investors.
[1:32] In our conversation, Mike shares how he validated and scaled
[1:36] alumni ventures to over $1.5 billion in AUM and over 20
[1:41] active funds, network driven approach to deal sourcing and
[1:44] value add. How the referral network
[1:46] generates 3.2 X multiples on invested capital, how a team of
[1:51] 45 investment professionals manage over 20 funds, his bold
[1:55] predictions about the profound period of innovation and
[1:58] disruption we are entering and lots more.
[2:00] So without wasting anytime, let's drive straight in.
[2:02] This episode is sponsored by my own podcasting agency called
[2:06] Podcast NX, where I help venture capitalists, asset managers,
[2:10] allocators and family offices and starting their own podcast
[2:13] and building a strong brand. Podcast NX is designed in a way
[2:17] to work well with the busy schedule of investors where we
[2:20] handle every aspect of podcast production so you can focus on
[2:24] investing. If you're looking to build a
[2:26] strong investor brand, starting a podcast should be right up
[2:30] your priority list. It's the only form of marketing
[2:33] where you can showcase your strong network.
[2:35] In other words, access to limited partners and founders,
[2:39] and grow that network further. And contrary to what most people
[2:43] hear, it's still very early to start a podcast.
[2:46] There are at least 10X more newsletters and thousand X more
[2:49] blogs than there are podcasts in this world.
[2:52] You can learn more about our podcasting services at Podcast
[2:55] ten-x.com. I'll make sure to add the link
[2:58] in the description below. Enjoy this episode.
[3:01] Hey Mike, so good to have you on the VC10X podcast.
[3:04] How are you doing? I'm great, thanks for having me.
[3:07] Yeah, it's a pleasure having you on to start things off.
[3:09] Can we start right from the beginnings?
[3:12] What made you start alumni Ventures about more than a
[3:16] decade back, right? And how did you get the idea?
[3:19] And what was that early traction, that early journey of,
[3:23] you know, from a spark to lighting the fire?
[3:26] Tell us about that. Sure.
[3:29] Well, the story really goes back to 1986 when I actually got my
[3:34] first job in venture capital right out of Dartmouth College.
[3:39] I, I joined a venture capital firm in Boston called TA
[3:45] Associates, which is, you know, a established early venture
[3:54] capital player, really a tremendous firm, you know, run
[3:58] at the time by Kevin Landry, really one of the legends of the
[4:01] business. And really my entire career has
[4:07] been at this intersection of venture capital, innovation,
[4:11] technology and entrepreneurship. Like a lot of, or at least some
[4:17] VCs, I've kind of flipped between, you know, being an
[4:24] entrepreneur and an operator and being an investor.
[4:28] I think there's some real advantages to that.
[4:33] But the genesis of Alumni Ventures was really from my own
[4:38] experience, which was that as an individual, it was really hard
[4:45] to access the quality and quantity of deals that I had
[4:50] come to believe is necessary to invest well in venture capital.
[4:56] So I have, so it really came out of what product would I want to
[5:01] have. And underlying that was a few
[5:07] core beliefs. 1 is that the very best deals find their way to the
[5:15] very best venture capitalists. And so, you know, you can see
[5:20] charts of relative returns of, you know, the top investors, the
[5:26] top venture firms and everyone else.
[5:30] People assume, I guess, that, you know, that's because they
[5:33] think, you know, VCs that these firms are smarter or change the
[5:39] outcome. You know, they're obviously very
[5:44] smart, talented people. But I think this is more the
[5:46] case where a really strong entrepreneur with a really great
[5:51] company largely has their choice of venture partner.
[5:56] And so that correlation however is real.
[6:01] And so and those deals are are largely inaccessible to
[6:07] individual investors. You know, and my other point of
[6:11] view on venture capital is it's a power law business that, you
[6:18] know, you need all the data supports a portfolio of at least
[6:22] 50 or 100 companies. You know, if you're saying
[6:26] they're doing, you know, a random venture deal every, you
[6:31] know, 6 to 18 months, you know, you're doing that because it's
[6:36] fun and you know, it's, it's, you want to learn something or
[6:41] you want to have an impact or stay busy.
[6:45] But I don't believe that's really the optimal strategy.
[6:48] There's just, you know, too many variables, too many unknowns.
[6:54] It is too dynamic to to believe that you can, you know, have
[7:02] that fine of a lens. So, you know, again, I think I
[7:08] think the fundamentals of, you know, good teams, good market
[7:11] opportunities, traction valuation, but I also believe N
[7:16] needs to be a pretty large number.
[7:19] So when I set out to build alumni ventures, we really built
[7:25] it around those ideas and, you know, the early traction around
[7:36] communities that we were putting together.
[7:39] And we started, obviously, in the name around alumni of pretty
[7:48] famous schools, you know, Dartmouth, Harvard, Stanford,
[7:52] MIT. You know, we're now at 25 or 30
[7:56] alumni groups. You know, we got early traction
[8:02] from alumni who said, yeah, it just makes sense that we could
[8:06] do better in this asset class together, then we can do it
[8:11] individually, that this is really a team sport.
[8:15] And you know, I believe they bought into that same vision of
[8:20] big portfolios, invest with really top tier lead VCs and use
[8:29] the power of the community and network to help our portfolio
[8:32] companies. So that's really the key to, you
[8:35] know, the key question is how do you get into the very best deals
[8:38] at the end of the day in venture capital?
[8:43] And you know, obviously networking and domain expertise
[8:46] is essential. And our strategy as a Co
[8:50] investor is a pretty simple value proposition that we say to
[8:56] an entrepreneur, yeah, your lead investor is a special
[8:59] relationship. They're going to go on your
[9:00] board, they're going to be, it's like marriage, right, kind of
[9:04] thing. You're going to live with this
[9:05] person maybe 10 years or more, but you're always going to have
[9:11] other investors on your cap table.
[9:14] And so we believe we can be a really strong Co investor for
[9:20] ACEO because of the power of our network.
[9:23] We have, you know, over 11,000 individual investors.
[9:28] We have a community that is now hundreds of thousands of people.
[9:33] You know, these are many of them are alumni of, you know, top
[9:36] schools or people in position of, you know, important business
[9:43] jobs. So, you know, we can really help
[9:47] our portfolio companies by making connections.
[9:51] We, you know, we have kind of a Rolodex on steroids.
[9:54] So that was the Genesis story and really the initial
[9:59] opportunity we sell. Right.
[10:02] Yeah, that's quite interesting. And clearly 10 years down the
[10:06] road we see that it's clearly working that he started out
[10:10] with, right? And you know there is this thing
[10:13] called fund product market fit as well, right?
[10:16] So at what point in that journey did you feel that, OK, this is
[10:20] starting to work, right? I'm seeing numbers going, I'm
[10:22] seeing the energy around it flow.
[10:24] People are coming to me, people are willing to invest and so on.
[10:28] What was that point for you and how did you recognize that?
[10:31] OK. This is product market fit for
[10:32] me. Yeah.
[10:34] I mean this was, you know, I agree it's it's product market
[10:40] founder fit I think is really what we look for a lot of the
[10:44] times in the investments we make.
[10:46] You know, we were starting to see that really on the on both
[10:50] sides of the Ledger Ledger we would meet with alumni and
[10:56] again, is, you know, this was hand to hand combat for our
[10:59] first, you know, green D1 is our first Dartmouth fund.
[11:04] Think we're on Green D 9 or 10 now.
[11:08] But Green D1 was, you know, a lot of individual meetings with
[11:12] fellow alums and, you know, the number of people who said this
[11:17] just makes all the sense in the world I'm in.
[11:21] You know, obviously people willing to buy your product is
[11:25] the ultimate, you know, market signal.
[11:30] But then on the other side of the Ledger, you know, our
[11:33] ability to access, you know, really good companies that, you
[11:39] know, some of our first investments, you know, we're
[11:44] companies like Sleeper, which is, you know, was I think Nan
[11:48] had six people when we first invested.
[11:51] Now they're one of the leading kind of fantasy sports companies
[11:54] around, you know, a company called Groups, which deals with
[12:01] kind of addiction clinics wasn't, you know, one of our
[12:04] very first investments. You know, we just, we were
[12:10] getting signals that, you know, because of connections and the
[12:14] value proposition, you know, we were able to access, you know,
[12:19] kind of top tier deals again. And, and that clearly said, hey,
[12:24] if that works at Dartmouth, that'll work at Harvard,
[12:26] Stanford. And now we've expanded even
[12:30] beyond alumni network. So, you know, a lot of our
[12:34] investors now didn't go to these schools, but they have an
[12:37] interest in deep technology or blockchain or AI or those kinds
[12:41] of things. So we, you know, we've now
[12:43] expanded to build communities just around areas of interest,
[12:48] not just where you went to school.
[12:51] OK. So is that only on the LP side
[12:53] that we are taking commitments from even non alumni or is it
[12:57] also on the deals that you're making, the people you're
[13:00] investing in, has that also expanded and you're also
[13:03] investing in people outside the alumni network?
[13:05] Absolutely. I mean, again, the way you get
[13:09] into deals at the very early stages of our business was
[13:14] usually there was like an alumni connection.
[13:17] But now because our network is well beyond just alumni of these
[13:23] schools that, yeah, well, we, we're just investing in great
[13:28] companies right now. And then, you know, again, the
[13:31] value proposition to an entrepreneur is that, you know,
[13:35] we have a just a tremendous network that you know, is alumni
[13:40] of these schools, but it's also, you know, other people as well,
[13:45] obviously. Got it.
[13:47] Yeah, That's quite interesting. So the alumni is now your mode
[13:50] as a firm in a way and everything we've all surrounded.
[13:53] And because of the network effects, you've now sort of
[13:56] expanded beyond the alumni themselves and taking
[13:59] commitments from and also investing in people in those
[14:02] networks who might not be alumni.
[14:05] Quite interesting. Yeah.
[14:07] And how you run it, run alumni ventures is also quite
[14:10] interesting. So once you've found product
[14:12] market trade, you saw that OK, I can just replicate the same
[14:15] model for other schools as well and you did that quite
[14:19] successfully. And what's interesting to note
[14:21] is that there's just a 40% investment committee that's
[14:25] overseeing 20 plus funds at alumni ventures, right?
[14:30] So can you tell me how does that work?
[14:32] Because every fund I would believe would have somewhat
[14:35] different way of operating. Correct me if I'm wrong.
[14:38] How does this same 40% committee aligned with all of that and
[14:42] function efficiently and make consistently make quality
[14:45] decisions, whether it's from one fund or the other?
[14:48] So let me clarify a little bit that we have, you know, 45 or so
[14:54] investing professionals, full time VCs at the company and we
[14:58] have roughly twice that number of people in support and back
[15:02] office, right, dealing with, you know, 11,000 individual
[15:07] investors. And we're, as you know, one of
[15:11] the more active VCs on the planet.
[15:14] So we do almost the deal a day. So there's a lot of back office
[15:18] and support people, but the 45 investing professionals are
[15:24] broken into 10 teams and that is very intentional.
[15:30] First of all, venture capital is a business that is about the
[15:35] deals you make and you want to avoid deals you miss, right?
[15:40] So I think 2 really good venture capitalists can look at the same
[15:47] deal and view it quite differently.
[15:51] This is not science. There is a combination of
[15:54] analytics and instinct and pattern recognition.
[15:58] So I think by having actually 10 independent teams, that is
[16:03] actually a huge strength of alumni ventures that allows us
[16:09] to look at things with expansive eyes.
[16:16] At the same time, we have a centralized office of investing.
[16:23] We have a process that we go through.
[16:26] So you could have and we and we, you know, we have the Crimson
[16:31] team and the Blue team, right, Crimson obviously being our
[16:36] Harvard alumni group. But you know, that team will use
[16:42] the same scorecard that to evaluate deals, the same due
[16:46] diligence memos and processes. All of our deals are reviewed by
[16:52] an investment committee, our chief investing officer, but we
[16:58] think it's very important to look at opportunities as much as
[17:05] what can go right as what can go wrong.
[17:08] And so, you know, this isn't one big amorphous group of 45
[17:14] people. This is 10 teams that have, you
[17:19] know, people with different levels of experience, different
[17:22] areas of vertical expertise. Our investment teams are
[17:27] actually quite T shaped. And what I mean by that is
[17:32] they're all generalists. They all look at a lot of deals
[17:37] about, they're all trained and kind of, you know, the
[17:41] fundamentals of being a good venture investor.
[17:45] But we encourage our people to develop areas of special
[17:49] interest where they can really get to know the companies, get
[17:54] to know the KPIs, get to know the extremely strong lead
[17:58] investors. So, you know, we'll have an
[18:02] individual within a team who, you know, has taken on quantum
[18:07] computing or will take on cybersecurity or even something
[18:15] like, you know, having a strong interest in startups coming out
[18:20] of Israel. So we encourage all of our
[18:24] people to be, you know, if they're on a team, they work as
[18:28] a team, but they develop in essence their own practice,
[18:32] which allows them to really develop some, you know, domain
[18:36] expertise. So you know, if if there's a
[18:40] sports tech deal, you know, everybody within AB knows to go
[18:44] to Keaton because that's an area that he has done a lot of work
[18:47] in, made a lot of investments. But we think having ten teams is
[18:51] almost like having 10 venture funds within AV.
[18:56] So that's kind of how we do it. We operationalize it.
[18:59] We do it with discipline, but we use we use a team approach.
[19:06] Got it. Quite interesting.
[19:07] So these ten teams are not separated by fund, but rather
[19:12] separated by their expertise. That that's what you're trying
[19:15] to say, right? Yeah.
[19:17] I mean they're, they're they're organized around specific alumni
[19:22] groups on one hand, but each individual within those teams
[19:27] has one or two areas of domain expertise, we call them
[19:32] practices that that they that they're able to pursue.
[19:36] So it's a it's a blend of team based approach, generalist
[19:41] principles and specific domain areas that they have a
[19:47] particular interest in. Absolutely.
[19:50] Quite interesting. Now let's talk about the
[19:52] decision making aspect, right? The people who are calling the
[19:55] shots on whether to make an investment or not, right?
[19:59] Let's say the GPS, right? So how many GPS are there?
[20:03] And is that like a consensus based investment vision that,
[20:08] OK, let's say we have 5 GPS. If three say we're going to
[20:10] invest, two say we don't. We go ahead and invest or who is
[20:14] in charge of making the investments.
[20:16] If there's like a singular person who's in charge of one
[20:19] fund that OK, I'm going to take the shots on this fund.
[20:22] How does that decision making work?
[20:24] Yeah. So each of our teams has a
[20:26] managing partner. So the team will in essence
[20:29] sponsor the deal, do the due diligence and propose it to the
[20:36] Office of Investing and there'll be an investment committee put
[20:40] around that deal who will then vote on it.
[20:43] So that's really how our process works.
[20:46] It's pretty straightforward. Each of the ten team sponsors
[20:49] their own deals. There's double checked by an
[20:53] investment committee. Other MPs serve on the
[20:57] investment committee, as does our, you know, members of our
[21:01] Office of Investing. But it's a very efficient
[21:08] process with, I think, good checks and balances.
[21:11] Absolutely love the way you have designed it and how it's
[21:15] working. Right.
[21:16] So your referrals at alumni ventures generate a 3.2 X
[21:23] multiple on invested capital, right?
[21:25] What specifically about this network drive such high
[21:29] performing deal flow? Yeah.
[21:31] I mean I think it's as I've mentioned really good
[21:38] entrepreneurs find their way to really good lead investors.
[21:44] So our strategy of being a Co investor alongside really top
[21:49] leads I think is part of the story there.
[21:52] I also think venture capital is still a network based business.
[21:59] So it's really important to view very well connected.
[22:02] I think we have one of the stronger networks in the
[22:05] industry. I think that is very helpful.
[22:09] I think we do a really good job in monitoring our portfolio and
[22:14] adding value to our companies. So our ability to put more
[22:18] capital to work in companies that are really getting traction
[22:23] and escape velocity is really one of the ways you get really
[22:27] strong returns. You know, and, and again, some
[22:33] of it is just, you know, a numbers game that again, if you
[22:39] if you invest consistently with discipline over time and you're
[22:43] a patient long term investor, you know, things turn out well
[22:49] for you, But it is also a humbling business where you
[22:53] know, you're going to have companies that fail.
[22:56] So it's, you know, just a a couple of recent investments.
[23:03] You know, we were investors in a company called Righetti, which
[23:07] is a quantum computing company that SPACT and then was really
[23:15] in the doldrums for years. And then, you know, really had
[23:20] some breakthroughs and quantum computing really kind of got
[23:24] under the spotlight and their technology was really valued and
[23:29] you know, the stock really exploded from there.
[23:32] So, you know, that was a team and investment we made, I don't
[23:38] know, seven or eight years ago. So we had to be very patient.
[23:41] You know, one of our portfolio companies, Circle just IPO
[23:47] couple of weeks ago, right? And again, this is a company we
[23:51] were in in 2018, two 1019 maybe. But you know, you know, this
[24:00] isn't day trading, this is investing in teams that are, you
[24:04] know, trying to change the world and tackling really tough
[24:06] problems and, you know, have to show a lot of grit and
[24:11] persistence. And, you know, it's it's part of
[24:15] the job of being a venture capitalist is kind of the being
[24:20] focused on process, disciplined portfolio management.
[24:26] You do your best to put more money to work in the companies
[24:30] that are doing really well and you try and be helpful to your
[24:34] portfolio company. So it's, you know, there's no
[24:37] magic. There's no, you know, get rich
[24:41] quick ideas here. But it is a really important
[24:45] part of, you know, what we try to do, you know, and we think if
[24:51] you do the right thing, the outcomes take care of themselves
[24:55] for everybody. Yeah, absolutely.
[24:59] And you talk about this AUM treadmill, right problem and how
[25:05] you how your flat fee model is designed to create a better
[25:10] alignment with your LP's, right. So then you talk about it a
[25:13] little bit. Yeah.
[25:15] It's, you know, obviously alignment is something that
[25:18] again, over 30-40 years in the business is really very
[25:22] important. And so we work really hard on
[25:27] that in the, in the creating of alumni ventures.
[25:30] First of all, we're ourselves as a company privately held, you
[25:35] know, we're owned by the team mates who work here and by our
[25:41] customers actually. So there's you know, really
[25:44] strong alignment between kind of LPGP where we allow our
[25:50] customers to invest in the company.
[25:52] So we think that that's a really strong alignment and kind of a
[25:55] long term perspective that we really encourage, you know, in
[26:00] the in the structuring of our funds, You know, we really
[26:05] encourage our investors to view this as kind of an annual
[26:11] allocation. The ability, you know, we think
[26:14] it's just good investing hygiene always to not be a market timer,
[26:23] you know, whether it's public equities or real estate or
[26:26] anything. You know, I think it's one of
[26:28] the human biases to think to overestimate their ability to
[26:32] kind of time things that perfectly, right.
[26:39] So we encourage our investors to invest to kind of have a budget
[26:43] and an appropriate allocation to the asset class and then invest
[26:47] in it consistently over time. And you know, I again, I think
[26:52] if you're buying the Essence P500, you're better off just
[26:57] doing that on a monthly recurring basis.
[26:59] Is it over time kind of thing, right.
[27:02] So we try to encourage people to take the same approach to
[27:06] venture capital. So, you know, most of our funds
[27:09] are kind of annual vintages and we encourage people to kind of
[27:14] budget a certain amount and put it in every vintage.
[27:20] That's one way to get your number of portfolio companies to
[27:25] be a bigger number, which we think is a really good idea.
[27:29] And we try to make it really simple for people where it's
[27:33] like, you know, one check, one capital call, right?
[27:37] So if you're going to go into, you know, our AI fund or our
[27:43] deep tech fund or our Harvard fund, it's just one check in.
[27:47] And our, we, you know, we, we keep our minimums low.
[27:51] And you know, our funds are typically 20 to 30 companies.
[27:55] So they're well diversified. So, you know, the simplest way
[28:00] to do this if you're not really wanting to dig in and evaluate
[28:07] individual deals is just, you know, find a fund that you
[28:10] believe in or a family of funds that you believe in.
[28:13] And just, you know, every year put a check in and after three
[28:17] or four years, you have a really nice portfolio.
[28:20] And then ideally what's happening is, you know, you're
[28:24] starting to get liquidity and you can start to recycle things
[28:29] and get the advantage of compounding then over time.
[28:32] So, you know, I think these are, you know, these are well
[28:38] understood principles of investing and we've just tried
[28:43] to apply them to this asset class that was really designed
[28:47] for, you know, institutional LP's.
[28:51] And it can seem risky or confusing to individual
[28:59] investors. But you know, one of the things
[29:02] that we that I've seen also develop, which is so many
[29:06] companies are staying private longer, right?
[29:10] That, you know, there's so much value now that is just being
[29:15] created in the private markets that if you're just going to
[29:18] wait for a company to go public at a $25 billion evaluation, I
[29:24] mean, that's, you know, that's a heck of a starting point.
[29:28] And again, you know, in I think well meaning, but I think it may
[29:34] be occasionally unfortunate unintended consequences of, you
[29:41] know, kind of a regulatory frameworks.
[29:43] You know, it's it's just become an industry that, you know, has
[29:47] been the purview of endowments in family offices and sovereign
[29:54] wealth funds. And, you know, we're just trying
[29:57] to democratize it a bit more by letting more people have access
[30:02] to venture capital in what we think is kind of a smart, simple
[30:06] way. Absolutely.
[30:07] Yeah, that's quite interesting. On that note, are all your LP's
[30:12] individual investors, or do you also have institutional
[30:15] investors as well? No, the vast, vast majority of
[30:19] our LP's are individuals, you know, and you know, they range
[30:25] from people where this is their very first kind of investment
[30:30] into venture capital and they want to learn and take it slow
[30:35] to people that are actually, you know, very wealthy and very
[30:38] sophisticated and they just appreciate our deal flow.
[30:42] And you know, a lot of times they'll be on the on that end of
[30:47] the spectrum. They'll already have access to
[30:50] some funds, but they want to supplement it with some sectors
[30:55] that they don't think their funds cover very well.
[30:59] Or, you know, they see some of the deals we're doing and
[31:03] they're just saying, geez, I would like to make an investment
[31:06] there. So we try to really meet people
[31:12] where they are and you know, if you're interested in venture
[31:19] capital, we're probably have something of interest for you,
[31:23] whether it's, you know, just a beginner or somebody who wants
[31:27] to just kind of fire and forget this for this asset class or
[31:31] people who really believe and want to learn.
[31:36] I mean, one thing I do believe in strongly is that venture
[31:40] investing is really sharpens the blade for just being a good
[31:45] investor period, because you know, you are really forced to
[31:50] the fundamentals and kind of the tip of the spear here.
[31:53] And so, you know, when, when we open up our deals to our
[31:59] investors, you know, we share our due diligence, we share our
[32:03] data room. A lot of times, you know, were
[32:08] well thought of by the management team.
[32:11] And so our funds will, you know, write a check for $2,000,000,
[32:15] but we'll be able to share another $1,000,000 with our
[32:20] investors individually. We can't always do that, but
[32:23] when we can, we like to do it. And our investors love that.
[32:27] They'll be able to look at a deal, evaluate it for
[32:30] themselves, and decide whether they want to add that individual
[32:35] name to their portfolio. Absolutely, Yeah, that's quite
[32:39] commendable. You know, scaling a firm to 1.5
[32:42] around billion dollars in AUM on the back of individual
[32:46] investors, that's quite commendable.
[32:48] And that also sends a note out to emerging managers who are
[32:52] trying to raise that there is an opportunity if you want to raise
[32:55] even from individual investors, you can raise a good sizeable
[33:00] fund to start with. And if you perform well, even a
[33:03] bigger fund like yours. A great example, right?
[33:06] So that's how they, and on the institution LP side, I believe
[33:10] all these institutions that you are covering, all these colleges
[33:15] that you are, you have funds around, let's say Harvard or
[33:18] others, they also have their own endowments as well.
[33:21] And I believe they're also deploying into VC funds.
[33:25] And I know for the fact that you are not affiliated with these
[33:28] colleges or institutions that directly, but why would they not
[33:32] deploy into a fund that's focused on their alumni?
[33:38] I think we've been, you know, I think we've been approached by
[33:41] some of these groups and endowments.
[33:46] I think it's a matter of, you know, we know our lane.
[33:49] We, we're always open minded. And I think, you know, over the
[33:52] next 10 years, we'll probably expand beyond individual
[33:57] investors to bring in institutions.
[34:02] I mean, obviously endowments make a lot of sense that, you
[34:05] know, I think just again, to take my alma mater's Dartmouth
[34:10] and Harvard, you know, we've probably invested in 300 of
[34:16] their alums who have founded companies.
[34:19] So, you know, I think it probably is in our future.
[34:23] So, you know, but we were just kind of maniacally focused on
[34:30] building our retail business for the first decade.
[34:35] But you know, one thing about that I've always believed when I
[34:38] started this business is we were really taking kind of a
[34:41] generational approach to building our firm.
[34:47] And so really the first decade was just to build out a retail
[34:51] business, build out our discipline on accessing the very
[34:55] best deals. And I think in the second
[34:57] decade, you know, the two big initiatives are really to grow
[35:03] our network internationally. So we're, you know, later this
[35:07] year opening an office in London and an office in Tokyo.
[35:15] And I think we'll also move into non individual sources of
[35:22] capital in our second decade. So I would not say no, I would
[35:26] just say it's not yet been the focus of the firm.
[35:30] So I I think that's more in our future.
[35:34] Absolutely. Yeah, that's a that's a massive
[35:37] take away for, you know, emerging managers that so much
[35:40] opportunity and so much funds are out there even in the retail
[35:43] market and individual investors that even if you just focus on
[35:47] that, you can build a pretty sizable firm just out of it.
[35:50] And the fact that you're still saying that this is still in our
[35:53] future, that we're going to think about institutional
[35:55] investors, that just says that there is still more opportunity
[35:59] in the retail space for you to tap into.
[36:02] So that's a great learning there.
[36:04] And now talking about scaling the firm from under 1,000,000 in
[36:10] bond to $100 million in commitments.
[36:13] What were the biggest operational or cultural
[36:16] challenges you faced in that process?
[36:20] I mean, it's just a, it's a very transaction heavy business.
[36:25] So by being a Co investor and by building having really a lot of
[36:32] volume on both the investor side and on the deal side, there's
[36:36] just a lot of transactions. So really building systems was a
[36:42] lot of the lift of the first decade of the business.
[36:46] I mean this this spring we sent out something like 40,000 K ones
[36:53] or something to individual investors.
[36:55] So you know, and with a 99.99% accuracy is takes a lot of
[37:03] systems and technology. You know, one of the one of the
[37:08] great benefits of AI is actually it really helps alumni ventures
[37:15] most than versus most venture firms which you know, have a
[37:20] they do a much smaller number of deals, much more concentrated, a
[37:26] much smaller investor LP base. So just, you know, a lot of the
[37:33] operational challenges were you have a scaling fintech company.
[37:38] So again, you know, I, I think of myself, you know, probably
[37:45] 50% fintech CEO, 50% venture capitalists and I would say most
[37:54] VCs would probably say they're 90% VC and 10% operator.
[37:59] So it's just a different ball game.
[38:03] And again, we're most, and this is, I think true of
[38:07] entrepreneurship where most people viewed that as a
[38:12] challenge. You know, why would I want to
[38:15] deal with an individual investor who writes a $50,000 check?
[38:19] That sounds like a pain in the ass, right?
[38:23] We view that as a feature. So, you know, I, I, we look for
[38:29] this in our portfolio companies, which is what do you do
[38:32] differently, think differently than the rest of the world?
[38:35] And you know, this is what I did when I founded this company is I
[38:40] viewed Co investing as a really important part of our strategy
[38:47] and building a network of individuals as an important part
[38:50] of our strategy. Got it.
[38:53] Quite interesting. How, how do you look at the
[38:56] current venture ecosystem, you know and how are you, how is
[39:01] that influenced how you do your investing?
[39:03] Has that changed anything about how you are doing things at
[39:07] Alumni Ventures? I mean, I think one has to start
[39:14] with what is the most important thing going on in venture
[39:18] capital right now? And the just what I would just
[39:21] say is with artificial intelligence, we're probably
[39:26] that technology is probably the biggest technology breakthrough
[39:30] of our lifetime. And so there's a lot of, you
[39:36] know, noise in the system. What I would say of, you know,
[39:40] tariffs and politics and these kinds of things, and I'm not
[39:47] diminishing them, but I'm saying in the context of AII think all
[39:53] of that stuff is noise. So I would just say we are
[39:57] going, we are at the beginnings of a very profound period of
[40:03] innovation. And disruption and are kind of a
[40:08] reshuffling of the decks and potentially 10s of trillions of
[40:13] dollars of productivity value creation.
[40:22] So you know, it's almost every day now.
[40:25] I've never seen technology that is this powerful and this
[40:32] broadly impactful and moving this fast.
[40:37] So I think most people, including most venture
[40:42] capitalists, frankly, just underestimate it.
[40:45] And so I think we're, and it's not just in software, but I
[40:48] think we're going to see profound impacts in healthcare.
[40:52] Just, you know, just this morning, you know, really
[40:56] exciting news coming out of, you know, Google and some of its
[41:03] discoveries around the genome. It's just going to change
[41:10] healthcare, I think, pretty significantly over the next 5 or
[41:13] 10 years. I think we're seeing huge
[41:15] innovation going on in energy. I think education is going to
[41:18] get disrupted. So I just think that it's going
[41:22] to touch almost every part of life, you know, is that over the
[41:28] next two years, the next five years, the next 10 years, you
[41:33] know, again, with humility, I can't kind of call that.
[41:36] But I just know that one has to operate their business with AI
[41:44] in mind and one definitely needs to invest through the lens of AI
[41:49] and that, you know, every deal we look at now, a lot of the
[41:54] discussion, is this company going to benefit from these
[41:59] geometric improvements or are they potentially just going to
[42:04] get swamped by them? So you know, I would say AIAIAI
[42:11] and everything else is noise. Got it.
[42:14] Totally loud and clear. And how do you think about
[42:18] liquidity and generating DPI at the firm And with 10 funds
[42:23] running under the firm and with the venture environment being
[42:27] what what it is, it is hard to generate that liquidity and DPI,
[42:31] right. So how do you think about that?
[42:34] How do you think about exits and the IPO market is not very open
[42:37] or always open. How do you get those returns
[42:40] into the fund and return that capital 12 piece?
[42:43] Yeah. I mean, I think I'm actually
[42:46] quite optimistic coming out of kind of COVID in the last couple
[42:50] of years. You know, obviously you know,
[42:53] we're very excited about some of the recent IP OS including you
[42:57] know as I mentioned our portfolio company circle and M&A
[43:06] activity is way up. I think, I think that there has
[43:12] been no change in the number of great companies being started
[43:17] and the value accruing to those companies, but it has been a
[43:22] pretty sluggish exit market. So again, if you're taking a
[43:28] longer term view, obviously returns are what we're paid to
[43:36] provide, but as long as the underlying asset is continuing
[43:40] to compound in value, you know that is the most important
[43:46] thing, right. The second thing I would say is
[43:50] there's clearly been a move where a lot of really successful
[43:57] companies are staying private and and they're saying it allows
[44:05] me to think in the longer term, the ability to access large
[44:11] pools of capital has changed dramatically over the last 10
[44:15] years. So I don't need to go public for
[44:17] capital reasons. And frankly the public markets
[44:22] can be fairly short sighted. And you know, do I need to deal
[44:27] with that? And I think very rational,
[44:35] thoughtful entrepreneurs are saying not yet or they're
[44:39] postponing it or, and what I see happening is I see a more
[44:46] sophisticated secondary market evolving where the ability to
[44:57] take chips off the table for early investors and for
[45:01] employees is, you know, really evolving very quickly.
[45:04] Now. In fact, Alumni Ventures is
[45:09] spinning out a a new company that is going to, you know, to
[45:15] focus on that particular market specifically because a lot of
[45:18] our, you know, 11,000 investors would love access to some of
[45:22] these late stage private ventures and you know, they've
[45:30] asked can we provide that for them.
[45:32] So you know, we're, we're going to be announcing something later
[45:35] in the summer that addresses that.
[45:39] So I think that market will continue to evolve.
[45:43] I am also hoping that there is new innovation and new
[45:49] approaches and new thinking around what is required to be a
[45:57] public company. And, and again, I think for some
[46:01] companies that discipline is really excellent.
[46:06] It can be a really important branding event for a company to
[46:09] go public. But you know, it's, it also
[46:17] comes with costs. And again, I think I obviously
[46:25] founded a business to help democratize this asset class.
[46:29] I think it's one of the unfortunate side effects of the
[46:37] public market system at the time that is discouraging companies
[46:41] to be public because, you know, it just makes it, you know, it
[46:48] makes it hard to be a participant in these wonderful
[46:52] technologies. So again, 1520 years ago, you
[46:56] would have would have had a company like Open AI or SpaceX.
[47:00] Those would have been available to the retail investor and they
[47:06] could have participated in, you know, that technology.
[47:11] But we've created a system where the leadership and the boards of
[47:15] those companies say, you know, that is not the best thing for
[47:19] us to be public. So, you know, again, well
[47:22] meaning but unintended consequences is we've made it in
[47:27] a way less democratic and less public.
[47:32] So but the market finds a way. And again, if you focus like we
[47:39] do on trying to just invest in great teams, tackling big heart
[47:44] problems, you know, we think that that'll evolve either
[47:50] through a more sophisticated public market secondaries I
[47:58] think will continue to become more accessible.
[48:02] But you know, maybe there's also a third way where you know,
[48:07] companies that are in these later stages have access and in
[48:12] but but perhaps not to the, you know, daily NAV pricing and kind
[48:18] of short term thinking of public stocks.
[48:22] Absolutely. Yeah, Quite, quite insightful
[48:24] there. With that, we'll move to the
[48:26] rapid firewall, wherein I'll ask you 6 quick questions about the
[48:30] investments you're making at Alumni Ventures via different
[48:32] funds. And so the first one is what are
[48:35] the sectors and regions you invest in?
[48:38] Yeah. So we're very broad based,
[48:42] obviously, you know, things like energy, defense, tech, AI.
[48:50] We have a couple of AI funds and robotics.
[48:53] We have a fund we focus on women entrepreneurs.
[48:57] We think that there's actually some gender arbitrage to be had
[49:01] in investing obviously energy huge things.
[49:07] One of the more interesting funds we have is a humans first
[49:11] fund. So with all this technology and
[49:14] AI and robotics, we we also believe that there's great
[49:18] opportunities for kind of human first investing.
[49:22] People want to physically get together in spaces.
[49:25] They want to do things in real life.
[49:28] So a lot of times when you see a trend, you'll see kind of a
[49:31] shadow trend. So again, because we're such a
[49:35] large investor, we're really investing across the horizon.
[49:41] Absolutely. A completely video on that, that
[49:43] the simultaneously the human aspect of investing should not
[49:47] be forgotten because I think that is something that will not
[49:50] go away regardless of what comes up and regions.
[49:53] Also, do you invest globally right now?
[49:55] Yeah. So again, about 90% of our
[49:59] investments are domestically founded in the United States
[50:05] currently. And again, you know very much
[50:09] following the venture industry. So you know a lot in California,
[50:13] New York, you know, Austin, Seattle, you know the big, the
[50:18] big technology hubs, Boston of course.
[50:23] But you know, we do invest internationally.
[50:26] One of our portfolio companies Aura people might be familiar
[50:30] with the Aura ring is very popular as an international
[50:33] investment. We have and we have and we have
[50:35] many. But again, over the next five
[50:38] years, you know we're looking to do a higher proportion of our
[50:42] deals globally. We've just think there's, you
[50:45] know, Silicon Valley is spread from California to the United
[50:50] States and it's really kind of taking over the world.
[50:53] So, you know, we go, we're great entrepreneurs are, and now great
[50:56] entrepreneurs are everywhere and we plan to be there as well.
[51:01] Absolutely. At what stage are you typically
[51:04] invest? Yeah.
[51:05] I mean, we're, we invest along the spectrum, but it would be
[51:10] kind of a if you were to look at a pie chart, we like to get in
[51:13] early. So we do a lot of precede seed
[51:17] deals. Obviously those are, you know,
[51:20] have a much higher mortality rate, but, you know, a all the
[51:25] way down the alphabet, you know, we'll look at kind of price risk
[51:32] return, but we'll invest along the spectrum.
[51:36] But, you know, with a bias toward, you know, getting in
[51:39] early and then putting more money to work behind the
[51:42] companies really, you know, getting traction.
[51:47] Right. And what's the typical check
[51:49] size you put in and do lead rounds?
[51:52] We never, we never lead rounds. So we're only a Co investor.
[51:56] You know at the precede seed stage we're writing 50 to
[52:00] $150,000 checks. You know, it kind of the Series
[52:05] A, it's more at the million or $2,000,000 range and then you
[52:10] know kind of in the three to $7,000,000 range if it's you
[52:14] know, down the alphabet a bit. Got it.
[52:16] Where can founders get in touch in case there is a direct way?
[52:20] Yeah. So, you know, our, our website's
[52:23] easy to remember whether you're a potential investor or you're
[52:29] an entrepreneur. It's AV dot VC and we make it
[52:33] pretty easy on our website to, you know, send us a note.
[52:36] I would say for founders, it's best to come in through a
[52:42] connection. So you know, an existing
[52:45] investor you have contacting one of our partners is probably
[52:50] going to get more visibility from us than just coming in over
[52:54] the transom. Again, It's, it's actually one
[52:58] of the tests for an entrepreneur is, you know, how can you, how
[53:04] can you make your way to the right person?
[53:06] And again, just keep in mind that we're a Co investor.
[53:10] So a lot of times you're you need to look for your lead 1st
[53:16] and then we're the kind of player that can really help you
[53:19] round out around that's typically the order of
[53:23] operations. Right, absolutely.
[53:26] Last one, where can our listeners follow you?
[53:30] Yeah, again, I'm on social media mostly with the AV dot VC
[53:36] handle. We also do a lot of webinars and
[53:42] blogs. You know, we do master classes
[53:46] that, you know, really we, we, we take our responsibility to
[53:49] educate very seriously. So I just encourage people to
[53:55] come to our website and sign up just to get our content.
[54:00] That's that's really the best place to start.
[54:03] Amazing. With that, we come to the Wrap
[54:06] and thanks so much for making time for this.
[54:08] Mike. I've always wanted to have you
[54:09] on the show and I'm glad you're here today and loved all your
[54:13] insights and especially loved how you build alumni ventures
[54:18] from first principles, thinking in your own way, not how the
[54:22] industry moves, which is quite commendable, which is rare to
[54:25] see most people follow the playbook.
[54:27] You did it your own way. Many kudos to that.
[54:31] Thank you for coming on and I wish you all the best and
[54:33] hopefully we'll have something to work on going ahead.
[54:36] Great. Good fun.
[54:37] Very nice to meet you. Thanks for your time today.
[54:40] Likewise. Thank you.
[54:41] Let's move. OK, Have a good one.
[54:43] Thank you.

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