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Jan. 26, 2021

Jeff Housenbold (Softbank) - Approach to Risk with $100B AUM, Identifying Markets That Are Ripe for Disruption, and Assessing Value Chains

Jeff Housenbold (Softbank) - Approach to Risk with $100B AUM, Identifying Markets That Are Ripe for Disruption, and Assessing Value Chains

My guest today is Jeff Housenbold, Managing Partner of Softbank's Vision Fund, the world's largest technology-focused venture capital fund, with over $100 billion in capital.

Some of Jeff's investments are DoorDash, Compass, OpenDoor, and Whoop. Previously, Jeff was the CEO of Shutterfly. We discuss how he approaches investment themes, how he identifies opportunities on the value chain, and markets that are ripe for disruption. Without further ado, here's Jeff.

Also, check out The Consumer VC Summit: February 23-25 about Ecommerce, Retail and Innovation.

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One book that inspired Jeff:

The Fountainhead by Ayr Rand

I highly recommend following him on Twitter @jtbold.

Here are the questions I ask Jeff -

  1. So in your career it seems like you've done it all as it relates to business. What led you to joining Softbank and be part of the vision fund?
  2. You're part of something that no one else has done - an $100 billion venture capital fund. Now, every fund has their ups and downs across the portfolio, but your fund has far greater AUM than any other fund in the ecosystem. How do you approach risk and portfolio construction?
  3. How do you think about returns? Since it's that large a fund, are you still expecting venture capital type returns or returns more similar to growth stage private equity?
  4. What's your process of deploying capital? What's your average check size?
  5. What criteria do you look for in companies?
  6. I imagine since you are writing large checks, you might have a more intensive due diligence process. If you could walk me through it.
  7. After you invest, how do you think about growth execution?
  8. I know you are a thematic investor and you extensive reports about large industries. How do you go about deciding what industry to focus on and your process creating the reports?
  9. An area that I know you focus on is real estate technology. What are current trends that you are focused on in the space and has COVID changed your perception of that industry?
  10. SPACs have become very popular in the past couple of years and I know Opendoor is going public via Chamath's SPAC. On this show, we've talked about the impact of SPACs when it comes to CPG and food and beverage brands and the impact of those types of businesses, but haven't spoken about SPACs impact on tech businesses. Would love to hear your thoughts on SPACs.
  11. You've been around the dot com boom and bust, the 2008 crash and now this pandemic. Seems for the past ten years or so when the economy was growing, companies optimized for growth, not profitability. Now the tune has changed and seems to have been changing in the past couple of years. How do you think about unit economics, sustainable, and optimizing for growth vs. profitability?
  12. What's one thing that you would change regarding venture capital?
  13. What's your most recent investment and what makes you excited about it?
  14. What's one company that's on your anti-portfolio and why did you pass?
  15. What's the best advice that you've ever received?
  16. What's one piece of advice that you have for founders?