The past three years have been unprecedented on many levels. For investors and venture capital in particular, rising interest rates, hyper competitiveness and the speed of innovation have changed the game.

It’s the end of an era, says Howard Lindzon, Founding Managing Partner of Social Leverage, an early-stage seed investment fund, and co-founder of Stocktwits, a social network for investors and traders.

“The world is smaller today. You are not going to see an Uber that goes into China in its second year,” Howard says. “You are going to see valuation compression and a lot of money chasing fewer big ideas.”

Perhaps one of the biggest changes can be seen in founders and investors themselves.

“In a world that’s this competitive, you want to be in business with people that have put in their 10,000 hours,” Howard says. “What we’ve seen the last three years is no one had 10,000 hours in crypto, yet everybody was in it. I think we lost our way. No one was asking the right questions.”

In today’s episode, Howard tells Jamie and Ana why he started Stocktwits (“Twitter for stocks,” as he describes it), what he looks for in a potential investment, why he focuses on seed-stage companies, trends to watch in 2023 and why we need to mentor Gen Z and not criticize them.

Key Takeaways

  • What should you look for in a founder or startup? Domain experience, a desire to solve a specific problem and stick with it, and the ability to recruit well.
  • We’re seeing a transaction crash in crypto brokerages. We are going to see the same thing in housing, where prices may not go down but transactions will stop because people are locked in.
  • Venture fund managers are the new founders.

Quote

“Information overload is only going to get worse. You have to be persistently curating to say, ‘Do I need this in my life?'” – Howard Lindzon

Links

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