Earnest Sweat 00:13
Today’s episode. We have a Purva meta. He’s the co-founder and managing partner at Summit peak investments, a firm backing top pre seed and see GPS with and also has a direct Series B plus CO investment strategy. He has an illustrious career as an allocator and investor with stints at Cook Children’s Hospital and also the Juilliard schools endowment. And today, he’s going to share with us his journey from managing institutional portfolios to building a fund of funds, what it means to be in a relationship first. LP, and as we were talking about in the prep of this conversation, some of his worries about the current trends that are happening in this market. So with that, we welcome

Earnest Sweat 01:14
want to kind of just dig a little deeper on, like, how you became an allocator and what led you to this, this point today.

Apurva Mehta 01:36
I guess I kind of fell into it. I mean, I’ve been interested in investing my entire life. So, I mean, you know, from the age of 14, I think if you were to ask my mom, she’d say, I just was infatuated with making money and so and so, she said, When I came in, came into this allocator world. She said, I finally found my home. Of like, you know, what I, what I was meant to do for a living, and but, you know, it started in high school with a stock market competition. And I just kind of love the competitive aspect of, you know, building a portfolio and trying to win. You know, who’s gonna, who’s gonna make the most money at the end of, you know, however many weeks to then working at Smith Varney, and, you know, sort of being an allocator, and, you know, doing sort of manager selection and search and and then after that, you know, a Sinta and Lehman Brothers for four years, you know, learned a ton. I mean, you know, I think, as we were sort of joking earlier about the digital age. You know, I learned a ton of things that’ll become useless tools today, like Excel and PowerPoint. But, you know, I learned about how being detail oriented is important. And then post Lehman, you know, fell into this role at Juilliard. I mean, it was really, it was 2008 there was a ton of fallout from the GFC fall of oh eight. And, you know, I happened to interview for this role at the Juilliard School, and they had Cambridge associates as a consultant, and they were building out their investment office and it was just, it was awesome. I mean, it was awesome to kind of leave Wall Street, quote, unquote, but then be in this allocator community and, and that’s kind of where I fell in love with the space. And so, you know, from then, you know, that’s where I met Patrick. He was at the University of Arizona. And, you know, I just built, I’ve always been a, you know, network first investor. And so built a great network in New York and really across the US of different allocators and, and that’s, you know, from Juilliard, it led me to Fort Worth Texas, you know, over 14 years ago. Wow, that’s,

Where did that policy budget come from?

you described this community and this sort of network first allocator. What? What does that universe look like, for our GPS listening and for our sort of junior allocators who are looking to kind of follow in your footsteps?

Apurva Mehta 05:19
So, I mean, it started at Juilliard, you know, when we’re less so, in this age of resource constrained investors. And I say that there are some endowments and foundations that are, you know, $5 billion and only three people on the staff, but, but generally, I mean, almost 20 years ago, there were one or two people managing these massive pools, and they were resource constrained. And so, you know, I built this community in New York, of, hey, let’s all share ideas. Um, it was, you know, called an institutional idea dinner, and we hosted them monthly, starting in, you know, 2008 and it started as 10 to 15 allocators getting together. And just like, This is what I’m working on in hedge fund land, and this is what I’m looking at. And it grew to, you know, probably into 2017 or 2018 to be 50 different allocators. So I would say the Endowment Foundation world is less resource constrained than it was, you know, almost 20 years ago, but it was just a great way to build community. About a decade ago, or more than that, we started investing in ventures, and we wanted to do the same thing. You know, we’re at Summit, peak, and starting in 2012 when we started investing in venture, you know, we’re backing solo GPS, which means you are inevitably resource constrained. You help, you know, managing a portfolio of 30 to 40 companies, and, you know, obviously you’re outsourcing everything else, but you’re still, you know, bandwidth constrained. And so we just, you know, we thought like, Let’s replicate what we were doing in the allocator world to the GP network, GP community. And so it started, you know, probably in 2014 you know, these GP community dinners, and it was just a way for everyone to get together. You know, back then it was probably quarterly. Now it’s roughly monthly. You know, in San we last last week we did one in LA next week, we’re doing one in San Francisco, and it’s just a way to bring the community together. And by that everyone comes from different networks or ecosystems. They have different strategies and portfolio constructions. But you know, it brings we would invest in these GPS for different reasons, and it brings this community together. We invite founders to it. We invite investors of ours. We invite prospective investors, anybody in the community we honestly that, that we think can benefit. It could be potential customers of a company. You know, if we’re, you know, if we have a relationship. So, you know, for us, it’s just a great way to just meet and connect with our existing GPS. You know, we also, besides, you know, we meet a GP, and I think we, we know from a first meeting whether somebody fits into our portfolio, but we want to get to know them over the next three to six months before we, you know, we sign that commitment, and it’s, you know, if we only invest in one fund, it’s a 10 to 15 year marriage and, and so, you know, we want to see how they interact with the community, like, do they come in and, you know, are they the bull in the china shop? Are they, you know, how do they interact with our, the rest of our GPS? And it’s just a way to get to know somebody outside of, you know, a zoom or office setting. And it’s really the best way.

Alexa Binns 09:45
And what was the impetus, or the sort of light bulb moment for creating Summit, peak? What’s the insight there?

Apurva Mehta 09:54
I think Patrick and I always wanted to be an entrepreneur. Unreal. You know, there isn’t a day that goes by. I mean, I want to. So we started working together in 2011 and in 2013 we started having these entrepreneurial light bulbs go off like, let’s do something entrepreneurial, which we were already, I mean, he was the first CIO to have a blank sheet of paper to go build this investment office, you know. Then brought me in, and we were already doing something entrepreneurial. Then we said, Let’s build out a venture portfolio at a time when people were running the other way. And so in 2013 you know, we were approached by a big institution that liked how we were investing in hedge funds. And they were like, Hey, why don’t you build out a hedge fund of funds portfolio for us? So we said, maybe this is an idea. Maybe we can, you know, turn this children’s hospital into an investment management company. And so we kind of, for five years, played with this idea of, like, do we build an outsource CIO? Do we, you know, spin this out into an investment management company? And inevitably, you know, the mission of the Children’s Hospital is to, you know, save children’s lives and treat children. And so it just, you know, it didn’t make sense to do it within the Children’s Hospital. And you know, of all the asset classes where we spend time, you know that entrepreneurial spirit that we have. It just gives you energy. I was in San Francisco last week. I’m there roughly every other week, and so I was in San Francisco last week, and I told the GP, like, it’s because I just watched Superman The weekend before with my daughter. But like, I told the GP that, like spending time with GPS and our founders is like, you know, the yellow sun to me, it gives me energy. And like, I just, like, I feel so alive hearing about the innovation and what people are building and so doing that a decade ago. You know, of all the asset classes that we could go to start a business, it’s the one place that’s really difficult to navigate. And you know, access really matters. And so, you know, of all the dirty words that we could go build a firm around, fund of funds was the worst.

Earnest Sweat 14:06
So throughout the story, one thing that really interests me was the intention of building those networks like that’s really fascinating. And in a world you talked about kind of like the resources constraint was a reason, I would also assume, especially as you were 10 years ago, looking to get into venture, especially kind of like micro VCs and whatnot, there was information constraint. You know, fast forward is not much of an information constraint, right? Right, and yet at your fingertips, you can get to with the network you guys have built, you can get to people, talk to me, a little bit of why you all still feel the need to have these gatherings. I understand being the central node, but like, what does it do for you all as well, and strengthening your point of view? As well as, like, how you execute on strategy.

Apurva Mehta 15:04
So I mean, being that central node and being top of mind, it really allows, you know, I mean, when GPS for us, that GP relationship isn’t just commit dollars, see you at the next fundraise, you know, we, we don’t necessarily want to read, you know, read the quarterly letter and get an update in that form, or go to the annual meeting. I went to an annual meeting last week, and I was like, this is all new. None of this is new news to me, because we like just having that regular interaction and flow with our GPS, and so it creates just a natural connection. It’s the same way that a GP is with founders. You know, they’ve got 30 portfolio companies. They have these casual coffees. They host events where they bring founders together. Everyone talks about the problems they are trying to solve. You know, as different founders, that’s kind of the same as what we’re doing. We’ve got a portfolio of 20 to 30 GPS across four funds now, and everyone’s talking about the problems that they’re trying to solve and and for us, that allows GPS to think of us of like, you know, when someone new is coming out with a, you know, a new fund, a new network or ecosystem. It’s important to be the first to call. I mean that information advantage, you know, we want to be there first. We want to help shape a new firm’s future. You know, it when it becomes over subscribed and there’s like this, you know, mad dash to, like, a final close or, you know, it just we have no edge at that point of, you know, or value that we can provide to that GP. And so we like being at the start of a firm’s journey. So you know our portfolio, you know, 50 to 60% of what we do we call core managers. And a core manager is now proven. You know, they’re on funds, 345, they don’t necessarily need our advice anymore. But, you know, there’s a repeatability to what they do and the results that they’re going to do, and the founders that they attract from you know how they deploy capital, and that’s a good thing. You know, there’s more persistence in results and returns and venture than other asset classes, so you need that. But 15% of what we do is finding new GPS we’re continually looking for, you know, the next generation of firms out there, and we like being there day zero and really helping them, you know, think about that story. Think about, you know, are they articulating Well, what their right to win is and what their portfolio can, you know strategy is, and where should, where they should think about taking capital from. Meaning should they take, you know, take capital from family offices or endowment, or how concentrated should somebody be? Should they give up a GP stake? We don’t take GP stakes. We you know, we think just put some elbow grease into it, you know, if this fund, you know, if you’re targeting 20, and it only turns out to be 14, it’s okay, you know, just, just kind of grind it out, and then the next one, you know, adjust accordingly. So we, we try to give the same way that our GPs are providing some value to founders, and that’s, that’s how they win deals, you know, in it, in a capital, you know, really capital abundant framework of whether it’s allocators to VCs, or, you know, GPS to founders. There’s capital available. You know, there’s no scarcity. There’s a scarcity of liquidity, but there’s no bad there is no scarcity of capital. And so founders want to take money from GPS that truly sees the value that they’re going to bring from getting them from pre-seed C to series A and I think it’s the same in the GP world.
Earnest Sweat 20:46
And that’s gonna that’s critical. That means you’re developing real relationships. And in a world where everyone’s email address is going to become their Yahoo email address, it’s important if you can be someone who people feel comfortable enough to call in. The other thing is, you know, in your speech that 15% is for new managers. That world has changed since you guys were first starting, and there’s just a ton more, right. Like, you have these conferences like raise and others, and there’ll be hundreds

Apurva Mehta 21:25
of raises next week bridge, you

Earnest Sweat 21:29
know. So there’s a lot to select from, like, how do you all think about not only filtering for what fits you, but also having that little piece that I know works in your brain. Like, are we iterating to what’s going to be successful for the next 15 years, not what was successful for us the last Yeah.

Apurva Mehta 21:50
I mean, evolution is crazy. You’re right. I mean, it’s way easier, way cheaper to launch. It’s kind of like company evolution. 20 years ago, it was way more expensive to launch a business than it is today. 25 years ago, sorry, it was way, way more expensive to launch a company than it is today. And now I throw in AI and everything is just cheaper to start a company. The same goes for fund management. You know, everything from administration to audit, everything I don’t say, has gotten commoditized, but it’s gotten cheaper, which means that anyone can do it, anyone with deal flow, can theoretically do it as cheap as on Angel List as possible. So that’s a change over the last 12 to, you know, 12 to 15 years in investing in the space, which means it’s gotten more crowded. You know, when we started in this space, it was a little bit easier to identify networks and ecosystems, meaning there weren’t so many of them. There was Y Combinator, then there were the universities, and then there was Facebook and corporations and people that had deal flow or like the PayPal Mafia. There was less mafias out there than there are today, and that’s because there’s been so much company value creation, whether it’s the Uber mafia or the Airbnb mafia or like all of this value creation that’s happened in Tech has created more and more networks or nodes, if you will. Yeah, and so that means there’s more and more firms popping up. So it is. There’s a lot more noise in the market, you know, today than there was. And in terms of, you know, figuring out how to identify, you know, who really is good, what networks and ecosystems are truly relevant, I guess that’s, that’s the first piece before it was very easy to identify the relevant networks and ecosystems. And then, you know, you have to, we leveraged our network to figure out who was good or not. Now it’s first, is this a relevant network or ecosystem? You know, we, we still, what’s changed over the last 15 years is we just have a deeper network so we can, you know, quickly triangulate on, you know, the relevance, not only of the network ecosystem, but you know, every, every GP is going to say, you know, here’s my value add, here’s why I win deals. And you know, our ability today to triangulate on that is, you know, I would say, at a lightning speed. We can, you know, after one meeting, make five phone calls and figure that out. You know, is what they say really true? Are they really, you know? And so the network effect compounds over time. You know, we’re better today. And I, you know, I think, you know, don’t tell our fun one to three investors. But like our fund for will be our best portfolio, because we’re constantly iterating like for the market that we’re entering and the market over the next 15 years. Like this is what makes sense from a portfolio construction perspective, and we have to kind of be at the forefront of it, like our portfolios aren’t static in time. You know, there is attrition from. One Fund to an x to an x, because we’re, we’re making sure we’re iterating on what’s appropriate for the market and so, but it’s, you know, for us, network drive sourcing. That’s what’s evolved in a massive way. You know, over the last 15 years, I’ve been involved in Bridge, and been on the board of bridge, and I’ve been in, you know, I’m on the selection committee for raise. There are great managers that come through. It’s a lot. It’s a lot to digest. You know, on the selection committee, I mean, I reviewed like, 40 decks and, yeah, it’s, you know, it’s a lot. It’s, it’s a So, it’s, it’s one way to to start. You know, if I were giving advice to somebody that was starting out, I’d say, find somebody that can that understands how to NAV, not saying, use a fund of funds, but just find somebody within the networks of Silicon Valley or US venture that understands how to navigate and and leverage that. I mean that that is because it is done, it is a daunting task to go to, you know, to go to these things, but get pitched and everything sounds amazing. Everyone’s, everyone’s got logos of, you know, here’s my prior track record, here’s the value add, here’s why we win. You know, with so many resources, like bridges and rails, which are really helpful to GPS, the pitch gets better. It’s like Y Combinator. The pitch all sounds the same now because, you know, it’s you’re getting so much guidance, which is a good thing. But as an LP, it’s hard to then navigate and differentiate

Earnest Sweat 26:41
that. Yeah, very wise. Because I think with venture, especially if you’ve been successful in other asset classes, you assume, Oh, I should just be able to easily get into venture. And there’s not a one to one all these allocations I’ve spoken to, there’s not a one to $1 at a time that you’re going to spend on that you might spend a lot more time and then allocate a little bit of dollars.

Apurva Mehta 27:07
Yeah, that’s probably the biggest learning, I guess. I mean, you know, it’s the least quality quantitative asset class. I mean, you could look at private credit, you could look at real estate, you can look at hedge funds. It’s the least quantitative asset class, unless a fund is a firm that is 10 or 15 years old, even then, it’s still you’re still thinking about the next 15 years and their ability to win deals, and is this portfolio construction appropriate for the strategy that they’re going to execute on. So it is the hardest asset class because there is a piece of you that really has to it’s a gut intuition of, you know, do they have what it takes? You know, a portfolio of a manager of a hedge fund? You know, there’s a lot of quantitative analysis, and so it’s, and to your point, you spend all this time, and it’s at least dollars deployed in a portfolio.

Earnest Sweat 28:05
Now we’re going to take a quick break to speak with our

Alexa Binns 28:08
sponsor on the show today. We have our seller partner and industry expert Shane Gowdy. He’s the leader of Sidley’s venture funds practice, and if you get value from this podcast, we have Shane and the Sidley team to thank for it. They make these recordings possible. We are looking forward to hearing from you. Shane, you lead the venture funds practice at Sidley. Could you just describe for us the team and the work you do?

Shane Goudey 28:32
Yeah. So my focus, my day to day focus, is working with venture capitalists of all sizes, shapes, creeds and colors. You know, the multi billion dollar per fund asset managers in the business running all the way down to brand new, emerging managers forming a five to $10 million fund. It really, truly is an entire ecosystem practice, purposely agnostic, because the fun is in who you get to represent on a day to day basis. So we really do it all, and you know, the part of So I’ve started at Sidley about a year and a half ago. I was at another firm for a quarter century, so I’ve been swimming in the venture fund waters for a very long time, and they are wonderful waters to swim in. I find myself just energized and refreshed and loving what I do here at Sidley, I am the head of the venture funds practice. Our funds practice is, you know, quite sizable. It’s about 140 lawyers representing all different sectors of the investment management space. I was brought over to Sidley, to really bolster and build the venture fund side of the practice. We have a nice, robust emerging companies practice. But in order for us to be able to represent the full ecosystem, I was brought on to kind of be the last piece of the puzzle to help us really maximize our opportunities. So the team is now. About 25 lawyers. It was, you know, one me about a year and a half ago. And so we’ve aggressively built, and certainly used a lot of internal associates to build our team. And now we have a really great practice of people who through lateral, partner and associate hiring from you know, key other firms with deep experience and really the right frame of mind for how to represent VCs in doing this work. Because I think there are a lot of people who can do the work of representing funds, but actually it’s not just doing the kind of fund formation. You have to understand the market and the mentality and what it really means to be a VC and how that reflects itself in a fund formation project. So, you know, we’re really building a practice that is built to be the concierge service for venture firms of, you know, any size, any shape. And we’re kind of built for speed and, you know, built for quality, and we’re really excited about what we’re doing. And, you know, the firm’s been incredibly supportive. And, you know, we just started, you know, we’re enthusiastic to be a really great part of the venture ecosystem. So it

Alexa Binns 31:07
seems like as you’ve been building the team, we’ve also been seeing momentum build on the fund formation side. Can you share just anecdotally, what you’re feeling here in the end of 2025 Yeah,

Shane Goudey 31:24
no, no. It’s absolutely nice to have to build practice when things are getting busy. From a fund formation standpoint, you know, it is as busy as it has been in the last three years. This is naturally a time of year when a lot of funds are doing their fundraising plans over the final quarter of the year, to be able to kind of have a closing, first closing around January, late January, early February, to take advantage of the fresh buckets of allocation for very large venture investors, but also people who you know, whether it’s family offices or high net worth, you know, fresh buckets of capital in their own kind of personal stakes to be able to invest. So just the natural time of year is great, but, but the market is really good now, right? We’ve got a lot of MQ and IPO activity. You know, I’ve heard of a couple SPACs back again. So, you know, the upside of the market is very busy providing liquidity for a lot of venture firms, and that, obviously, is the fuel in the tank for any of these firms to be able to fundraise. You got to produce returns. And from a time over the last two to three years where there hasn’t been much of that, or you’ve had to be very, very creative about how to create secondary opportunities, this tends to be kind of relying on some of the more natural channels of MQ, IPO activity to have hope, at least, that things are starting to turn around. And if I look at the number of funds that are out there now raising, you know, these are, these are more Certainly not 2021, days. But, you know, big markets, which have sort of been the hallmark of the last three decades. These are kind of the little bit of the evidence of what’s gone on in some of those markets. So we’re pretty excited in our sector of the world.

Alexa Binns 33:09
And now back to our LP interview.

Earnest Sweat 33:14
Is there? You look at a lot of different fund manager decks, and you know, meet a lot of fund managers, is there a certain strategy or profile that you’re surprised you’re not seeing, or that you’re looking for?

Apurva Mehta 33:27
I think, going back to what I’ve said, like the market has evolved where, I guess what I’m surprised to see today is there are managers coming out of places. And we, we like seeing managers, crawl, walk, run, you know, meaning have a set strategy around $25 million fund, one, you know, X ownership, you know, grow to $50 million dollar fund to or $75 million fund to or 80, whatever it is. And see a progression of ownership, board seats, things like that. I would say we’re seeing more and more managers come out and like they’re going straight for the run, you know, you know, for the run. And I mean, some can, some can do it because of, you know, the background that they have, or where they came out of, you know, that brand, you know, sort of that brand backing that they have. So I guess I’m seeing more of that. There is a lot of attrition coming from, you know, brand name firms, whether it’s Sequoia or Andreessen. You know, it doesn’t speak. I don’t know the reasons why, but there’s just a lot of that. And so we, we tend to, tend to favor the founder operator turned VC. You know, that has a track record of investing, but they’re a founder operator. We. And that’s the kind of firm that we tend to favor. And, you know, all of last year, I saw so many spin outs from, you know, brand name firms. I think the market is favoring brand recognition. And, you know, we’ve tended to favor non brands in, you know, in the past, you know, we because we favor that founder, operator first mentality. So it’s not to say that we won’t invest in people that have come and worked at a brand, but, but, you know, so I guess in terms of what we’re not seeing is because the market might be a little bit frosty and, you know, and and because people are coming out of brands, you’re seeing more of that, you know, going straight to the run first. And so I guess I wish I’d see more of that crawl, walk, run, sort of thoughtfully and patiently, you know, measuring how you build your firm.

Earnest Sweat 35:57
you mentioned a little bit about some things you’re worried about that you’re seeing, right just like you’re keeping note of since us coming out of the last kind of, like, run up, could you just speak to the audience on that and how that’s, you know, shaping your perspective right now?

Apurva Mehta 36:19
Yeah, it’s, you know, as we’re putting together our fund for portfolio right now, you know, and all sort of re underwriting of existing managers or looking at new managers. You know, in 2021 the market got crazy. I mean, you know, it was the speed at which people were raising capital, deploying capital, you know, it got crazy and fun. Sizes got crazy. It meant that there was a lot of style, strategy, drift, you know, we tend to favor pre-seed, seed, up to early stage. And people became multi stage, and really veered off the path, you know, and for the most part, that just really means, like, valuation discipline and and so that, I guess, is probably my biggest fear today. You know, whether it’s AI, you know, founders coming out of places. I mean, last, as I mentioned, last week, we’re in San Francisco, and met with the GP. You know, she raised her second fund two or 3x over subscribe, and she was just talking about what she’s seeing in the market. And, you know, she tends to, you know, she wants high ownership. And you know, she was just describing like, some of the valuations are insane. And, I mean, there’s, she’s not. She slowed down her investment pace because of that, you know, sort of cautiousness around valuations. But given that valuation piece, it means managers are upping their fund size to back into ownership. And so it’s like this, I don’t know. It’s this twisted circle. You know that one is driving the other. And, you know, I don’t know how, I guess I know how the story ends. I mean, it just means, you know, you’re going to have a bunch of lopsided funds at some point, or just like a poor returning vintage, you know, if there’s no valuation discipline. So I just, I feel good about, you know, managers that we talked to when, like, when I, you know, that meeting last week where they say, Hey, you know, we’re, we’re not doing $80 million seed, seed rounds, you know, I mean, and there are, there’s some seed rounds happening at 100 I mean, that the entire genesis of what we believed 13 years ago was that you can invest in these pre seed, seed firms, and not everything needs to be a billion dollar outcome and and we’re seeing it, you know, in this liquidity constrained environment that we’re in today. You know, we had a GP about three weeks ago who had invested 750,000 of an $85 million fund. They sold that position into a growth round, and they returned 50% of our commitment back to us. And so that’s an example of why, why the math works when fund sizes are small, you know. And so if you’re but if you know, fund sizes are growing to be enormous, valuations are ballooning, you know, yeah, everything does need to be, you know, a billion or multi billion dollar outcome to make the return the fun math work.

Earnest Sweat 39:45
So with all of that in the current market, how has that impacted your hybrid approach of the growth deals that you all participate in?

Apurva Mehta 39:58
I mean, from. The beginning we’ve, we’ve tried to stay true to Series B. I mean, so we look at Series B, you know, generally, that’s going to be a company. We’ll do a little bit of pre Series B investing and a little bit of post Series B. And as you know, like letters are, you know, there’s a fallacy around letters. So it’s really around revenue and growth metrics and things like that. But the Series V suite spot is, you know, company is, let’s just say, in the three to $5 million revenue range, growing at three times year over year, so approaching 10 and then gonna, you know, if it’s not in AI, I mean, if it’s an AI, it should be 10 Xing from there. But if it’s not an AI, you know, I think somebody said it, you know, the triple triple double double double is, you know, which is like growing revenue, triple triple double double. I think that playbook is out now, and now it’s like, you know, 1x 10x 100x

Apurva Mehta 41:00
Some but so we like that sweet spot. You know, there is less risk of a company going out of business. There’s always risk of a company going out of business at any stage, but there’s less, you know, call it risk of a company going out of business. You know, the valuation range for us at that stage, you know, will be, you know, 75-80 million, 100 million on the low end to 400 500 on the high end. And you know, if it’s on the high end, we’re underwriting, hey, you know, do we think that the market opportunity supports a 10x from here and and so for us, that hasn’t changed. I mean, market pricing dictates, like, are we overpaying for growth? So in, you know, 2020, or 2021, we might have been in a series B at the top end of that, you know, 400 $450 million range for a series B, relative to the revenue that they had, and they’ve now grown into it, but, but so depending on market, you know, it just that dictates a little bit of kind of the current revenue multiple we’ll pay and forward looking. But as we, you know, we try to be disciplined, like we’re really not trying to overpay, you know, we, we’ve seen series as and, you know, even seeds, which are 1,000x forward looking revenue, or just while, I’m sure, you know, if we had a seed fund, I’m sure it would make sense. But, you know, it’s just, there’s going to be a lot of zeros, as there should be. I mean, venture is meant to have mortality, but at the series B, you know, it’s supposed to be less that mortality is supposed to go down as stage, you know, as you, you know, move down the stages. And so for us, really, our CO investment strategy hasn’t stayed, hasn’t changed. We’d like to be, you know, going back to being in front of our GPS. We’d like to be a really good partner there. I mean, a lot of investors talk about wanting to co invest, whether it’s a family office, to an endowment or foundation. And you know, for us, we’re continually cultivating our portfolio for deal flow, because we’re talking to our GPS constantly. It, you know, it is, hey, this company is doing really well, and they’re going to be going out for their series B in Q1 and that gives us the ability to start doing work now or six months ago, and have a year lead time. And having that year’s lead time means that we can go to a GP and say, hey, we’ll take two to 3 million out of our fund. And then our investors also like investing alongside us. You know, we’re going to do 5 million out of an SPV. So it arms a GP with like, hey, we know summit peak is good for three to $8 million and you know, so we can go and ask for super pro rata. So that’s how we try to be a good partner to our GPS, you know, transparent and then fast in our process.

Earnest Sweat 44:08
That’s what it was going to be. My next question is, so many LPs say they want to do co-investing, but what they end up doing is something that is a lot more passive and that doesn’t have, like, some level of rigor to it as well, right? So, you know, they’re waiting for GPS, they’re not being proactive, like yourself and actually having those conversations, making those notes and then starting with the relationships with those founders, they’re just waiting for the things to happen, and they’re slow.

Earnest Sweat 47:29
One thing I don’t think I’ve ever asked anybody, that I’ll ask you, is obviously, you’re, you’re very networked, and you’re, you’re you guys are opposite of passive, of being intentional and meeting new GPS when you finally met a GP that you’ve done your diligence homework and you want to do the you know, be involved in allocation, and they’re over subscribed. What’s your approach to winning that allocation? Just for in the context, is like we have a lot of allocators who listen and so, like, you know, when they actually have done the work and feel that, they feel,

Apurva Mehta 48:08
yeah, there’s been a couple, you know, I would, I would say, in the last year or two, there’s been a couple of cases where that’s happened, Where, regardless of how we source it, meaning we source it through our network, which meant that we already got to them because of our network. But there was a case earlier this year where, you know, GP spawn out of a different firm. We were the first meeting, even before there was a deck. But it quickly became this, like a lot of people interested. So we leveraged our network. I mean, we said, you know, call up any of these GPS that you know, you know, these are people that we’ve backed, and you know them well, call them up and ask them what they think of us as a partner. It’s kind of no different than like a GP with a founder saying, you know, a founder seeing, like, do I want this person on my cap table? Are they going to be a value add partner? And so that’s how we’ve won, in the sense of, if they’re going to make room for us, or that’s how we’ve won, you know, the allocation we want, because these GPS will call up other GPS and like, how is summit peak? Are there as a partner? I mean, they tell a good story, but are they really like, you know, once the docks are signed, sealed and delivered, do they become like the opposite of what they’re selling? Because we’ve just met, and so it’s impossible to get to know us in that short of a time frame. And so that’s, I mean, in the last this past year, it’s happened twice in sort of over subscribed scenarios, and they were like, No, we’ve heard great things about you from our GP network. And, you know, we want to build a long term relationship with you. And so that’s kind of, you know, that I would say that’s how we win.

Earnest Sweat 49:59
Where do you think the next 10 years will go, in particular, like, what trends do you think where allocators place their bets, where they’re currently facing their bets? Do you think that will change, as you mentioned, kind of like the brand, will you see more fragmentation? What do you think that the market will do? I think

Apurva Mehta 50:40
you’re seeing it in allocators today. I mean, it’s been over the last year. I think you’re going to continue to see it. I mean, you’re going to see more big firms turn into SEC registered firms. You know, I don’t welcome SEC registration upon anybody. It’s a lot, but they have enough people to do it. But I think you’re going to see bigger, you know, firms on the brand side turn into SEC registered firms. You’re going to be see more GP staking in that framework, you know, a la, general catalyst, or, you know, people owning parts of, you know, Goldman owned a part of industry ventures before, you know, before buying industry that, you know, yeah, so you’re going to see the big firms continue to get bigger and swallow up, you know, that segment of the market is, is going to just balloon and assets as They become registered, you can do lots of things, secondaries, you know, every any kind of strategy, the fund to fund space is going to continue to, you know, balloon in terms of, like, you know, the firms out there. I mean, it’s when we started this, seven years ago, the market was pretty thin. I would say, even a year or two ago, the market was pretty thin. And I just think you’re going to start seeing more fun to fund out there like, being able to give access. So I think that space continues to grow on the smaller end. I think, you know, the fragmentation is still going to be there. You know, people are going to sell their access to founders. They’re going to founders are going to take their capital because of the value that they provide, you know, and founders still inevitably need help getting from that seed to series A and so you know that smaller end of the market is going to, I think, continue to expand, continue to, you know, be fragmented In terms of, like, the haves and the have nots. But I feel like, you know, there’s going to be a lot of, some of those firms could get absorbed. I mean, you know, there’s going to be more GP staking in that space. There’s going to be, you know, everyone’s trying to get deal flow in some way, shape or form. And so, you know, I think in that early stage segment, you know, you’re going to see an observe, maybe I could be wrong, but you’re going to see firms like, swallow it up, like, Oh, why don’t you come in house to, you know, you know what we’re doing over here. And, you know, just become the seed team, as much as people like their independence, like, you know, you’re, I feel like you’re going to see maybe more absorption of, you know, teams like that, kind of like in AI, right? It’s you’re building something, and it’s, let’s absorb you in, because you can build it better here.

Earnest Sweat 53:36
So, yeah, and with that landscape just quickly. What does success look like for summit peak?

Apurva Mehta 53:47
Honestly, we want to stay in our lane and just rinse and repeat. I mean, we like our small fund size math, you know, if we want to, if we want to win investors trust and partnership is putting up returns. That’s, you know, tvpi and DPI in the way to do that is staying in our lane. I mean, I think we can confidently continue to put up results. You know, in our sweet spot of fund size, that’s right now, 125 150 you know, in that range, maybe 175, we like staying small and nimble. We’re, you know, we’re a small team. I mean, I was reading about industry ventures yesterday, and 45 people, although that is small for 7 billion people, but I mean, 7 billion in assets, yeah, but we’re a small team. It means that, you know, the thing that I love most about some of our investors is they’re transparent, they’re responsive. You know, even through the fundraising process, which is a grind, you know, the best investors are transparent, responsive. They don’t go with the shoes we’re that way with. With any GP, we’re transparent or responsive, whether it’s on a co-investment, you know, from the onset of a first conversation, I, you know, I take the hard part out of the GPS work on the other side, I’ll tell them, here’s our process. Here’s what our check size is, you know, timeline, you know, here’s how we work with our you know. And they’re like, Wow, you answered all my questions. So we try to be transparent and responsive. And so we can only do that as this small and nimble team, you know. And so, you know, if we grow in AUM, that means we have to add people, you know, people management is a whole nother aspect of the fund management business. It’s already, you know, it’s one thing going from an LP to a GP. Being a GP involves fundraising, portfolio management, running a business, you know, and then adding people management into it. And so, like, it’s just another factor of, you know, and so for us, you know, 10 years from now, 10 years from now, I don’t know we’d be on, we’re on fun for so maybe fun nine and on kind of rinse, repeat. And so, yeah, it’s honestly, we just, just want to continue doing what