April 26th, 2013 was the day we closed Homebrew’s initial fund and we consider it our ‘birthday.’ The firm’s why and how were previous blog post topics and I won’t rehash them here, but first I want to share my 2013 Homebrew ‘premortem‘ with you.
When Satya and I started Homebrew together it was with full intention to be our ‘last career,’ what we’d be doing for the next 20 years or so. And if this *wasn’t* the case, my POV was it would be explained by one of these three reasons:
- I didn’t like venture
- Satya and I didn’t get along
- Satya and I weren’t good at our jobs
So where are we now, with approximately 2,500 days of evidence?
Well, turns out I don’t generically like venture *but* I do love Homebrew. That is, it’s difficult for me to imagine being part of someone else’s fund. Even with the firms I respect tremendously, I have little desire to be the third, seventh or 14th partner around their table. I like our size, our strategy and the shared, equal responsibility Satya and I have to deliver against our promises to founders, LPs and one another.
And my relationship with Satya? It’s great – the whole is greater than the sum of its parts. Partnerships are dynamic and neither of us take the harmony for granted, but I’d be very surprised if there was ever an issue between us that could cause Homebrew to dissolve prematurely.
Number Three, are we any good? There’s a tendency to pronounce victory prematurely in our industry. Here’s how I define GOOD in venture: multiple consecutive funds where you’ve beaten your benchmarks while employing a repeatable strategy. By that measure it’s too early for me to answer but we’ve gotten off to a nice start. I’m confident that founders and coinvestors trust us. The founder feedback surveys we run every other year via a 3rd party give us positive indications that we’re living up to expectations (and of course, always a few things we could do better). Entrepreneurs are our customers and they keep us in business.
We’re investing out of our third fund now (which should take us to 2022) and have a solid group of institutional LPs backing us. Our first fund has already returned over its original principal to investors and we’re fortunate to have quite a bit of value still on paper (which we never assume means anything until it’s liquid). So by my own criteria, I’m not yet ready to say we’re “good” — won’t know that until mid-decade – but I can say we’re “not bad.”
Some of you know I have the Homebrew logo tattooed on my right shoulder. I did this to capture the creation of something meaningful. Thank you to Satya, our team, the companies we’ve backed, the coinvestors who work with us and our partner LPs for being the meaning behind the ink.
(Part 2 of this post will be responding to my AMA tweet and I’ll try to get it out within next few days. thanks for patience)