Bessemer Venture Partners - Building a VC Firm that Lasts Centuries - [Invest Like the Best, EP.327]

My guests this week are Jeremy Levine, Kent Bennett, and Brian Feinstein. They are partners at one of the oldest and most storied venture firms in the world, Bessemer Venture Partners. Our conversation is split into two parts. First, we explore Bessemer itself. It’s over 100 years old and has a unique operating model with lessons for every investment firm in the market. We then discuss Jeremy, Kent, and Brian’s investing styles and outlook. What they look for in businesses, their thoughts on various sectors like vertical market software, and we close with a discussion about AI and defensibility. Please enjoy this great conversation. 

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For the full show notes, transcript, and links to mentioned content, check out the episode page here.

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Invest Like the Best is a property of Colossus, LLC. For more episodes of Invest Like the Best, visit joincolossus.com/episodes. 

Past guests include Tobi Lutke, Kevin Systrom, Mike Krieger, John Collison, Kat Cole, Marc Andreessen, Matthew Ball, Bill Gurley, Anu Hariharan, Ben Thompson, and many more.

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Show Notes

(00:03:14) - (First question) - The unique history of Bessemer and how the firm stays current

(00:08:55) - The role of heritage and cooperative partnership in Bessemer’s model

(00:14:36) - How giving each partner autonomy and commissions can lead to better personal and company outcomes

(00:17:18) - The extent of freedom a partner has in terms of the style of investments made

(00:20:38) - Retro-analyzing the effectiveness of their investment roadmaps and core insights

(00:25:10) - What conflict typically looks like in partners’ conversations and how they resolve it

(00:27:06) - How they enable their junior staff using apprenticeship and open dialogue

(00:31:31) - Their different taste in investment targets 

(00:35:11) - How they each evaluate companies based on their unique interests

(00:42:32) - Their thoughts on valuations and how they have dealt with with run-ups in the tech market

(00:45:46) - What they anticipate in the future of early-stage investing

(00:49:43) - The significance of Centaur companies that have hit $100-million in revenue

(00:52:38) - The success of Bessemer’s writing and online content

(00:55:13) - Where the vertical market software industry is in its life cycle

(00:59:12) - How the next wave of innovation may revolutionize software or even depart from it

(01:02:33) - Advice they give to companies looking to prepare for future shifts in tech and AI

(01:04:46) - What excites them and what scares them within the development of LLMs

(01:08:18) - Defensibility of an LLM-based company, given the high level of competition 

(01:10:39) - How their firm deals with terminating partners if and when they aren’t a good fit

(01:14:53) - The kindest thing anyone has ever done for each of them