This article originally ran in Term Sheet, Fortune’s newsletter about deals and dealmakers. Sign up here.
In February, Reddit co-founder Alexis Ohanian said he would step down from his daily role at the company to return to investing.
Ohanian is now full-time at Initialized Capital, the early-stage VC firm he co-founded with Garry Tan in 2012. The firm has more than $250 million in assets under management, and its investments include Coinbase, Instacart, Zenefits, Opendoor, Soylent, Cruise Automation, and Standard Cognition.
“I still use Reddit to discover burgeoning trends,” Ohanian told Term Sheet. “It’s a big part of why Initialized was the first check in Coinbase. You could see these trends popping on r/Bitcoin, for example. The early, organic communities served as really great focus groups.”
Ohanian, who recently had a daughter with wife and tennis champion Serena Williams, took 16 weeks of parental leave before making the decision to leave his operating role at Reddit.
In a conversation with Term Sheet, Ohanian discusses the elements he looks for in a founder before investing, his outlook on cryptocurrency, and the new data-driven investing platform he’s building in-house.
This Q&A has been edited for length and clarity.
TERM SHEET: You stepped away from your duties at Reddit to focus on Initialized Capital. Why now?
OHANIAN: We are at such an interesting time right now. The first time this Internet thing got built up, I was just a kid in my parents’ house building websites, but I couldn’t have a big impact. Right now, it feels like the innovations that will get started in the next 10 years will have a huge impact on the world.
I’m proud of all the work we did to turn around Reddit in the last three years, but I think about the impact I could have at one company versus the potential I could have investing in dozens of great, multibillion-dollar companies — and that’s the way I want to scale my next decade.
What are some of the key elements you look for in a company or founder before investing?
OHANIAN: There has to be a relentlessness to the founder. It’s easy to have an idea. It’s easy to print out some business cards. Where it starts getting hard is when you actually start testing some version of your idea, getting it in front of customers, and then finding out they’re not willing to buy your product. Even though we’re working with early-stage founders, there’s a clear indication very early on of what they’ve been able to build, not what they’re able to talk about. That makes a big difference.
I’m looking for the basic things — is the founder able to meet a deadline and execute? But I’m also looking for more complex things — are they able to operate in a world of uncertainty? There’s no syllabus for entrepreneurship.
You told me you were planning to double down on investment opportunities in emerging technologies such as blockchain. What are your views on what’s happening with cryptocurrency and the blockchain at the moment?
OHANIAN: Last year, it was all about AI and machine learning, This year, it’s all about blockchain. Most of it is just hype and BS, just like how it was with AI and ML. Most of the really vital, protocol-level, basic infrastructure around software and blockchain will need to get built in the next year or two for us to really see the Web 3.0 we’re really hoping for. So those are the types of companies we’re investing in now. These are the types of things I think will build the foundation for a very different, much better Internet.
I was a kid in the 90s without much leverage when the first Internet was being built, so I see this as a hell of an opportunity. We’re still figuring it out. We still don’t have a Netscape, but it’s coming.
What’s interesting is we’re seeing more teams with business and product backgrounds moving to start or join blockchain projects. So you have your earliest adopters who are very hard core on the engineering side, and now we’re starting to see people who have experience at later-stage startups who understand the UX and business portion of it. This stuff doesn’t actually change the world unless everyone is using it. And the way everyone is using it is if there are interfaces that make sense and that there’s product that’s beautiful and effective. That’s just starting to happen now. As an investor, I get to have a front row seat to this new Internet.
Coinbase recently approached the SEC about registering as a licensed brokerage. The cryptocurrency market is still in its “Wild West” phase, so what do you think regulation will look like?
OHANIAN: Right now, it seems like we’re in a pretty low regulation environment in the United States. I would be surprised if there was anything other than a light touch. It’s important because there have been a lot of charlatans who have gotten into these initial coin offerings as a get-rich-quick scheme. It’s frustrating because it undermines what is a really innovative technology. These people should be punished full-stop.
The hope is that you can do enough to punish existing bad actors and deter future ones, but you also have to make sure that you don’t throw the baby out with the bathwater.
How high do you think Bitcoin will go?
OHANIAN: To the moon. [laughs] I still hold a little bit of Bitcoin, and I think it has such mindshare that it will continue to be a store of value. I’m most bullish about Ethereum simply because people are actually building on it. It’s still early days, but you know, we’ve got a few CryptoKitties. [CryptoKitties is a blockchain-based game that allows users to purchase, collect, breed and sell virtual cats. The company behind it raised $12 million in venture funding from investors including Andreessen Horowitz and Union Square Ventures.]
We didn’t invest, but it didn’t surprise me one bit that they raised [funding] because they had the first real application. It’s easy to laugh at, but I think the first version of so many things looks like a toy and often has something to do with cats. It’s because the Internet loves cats. And I think I know why. You want to know why?
OHANIAN: The reason cats are so popular on the Internet is because cat owners never got to associate or hang out with other cat owners doing cat-owner things. Until the Internet came along.
Oh wow. You’re not kidding, you really have a theory…
OHANIAN: Yes. This is all real and on the record. Dog owners take their dogs to the dog park, the dogs play with each other, the owners discuss this really cute thing that Chip did yesterday, and they do their dog bonding. But I don’t have a cat park to take my cat to. So we have no way to meet and talk about our silly cat things until the Internet. I’ve seen a lot of this happen before my eyes, and it finally clicked a few years ago.
So if you were to give a ballpark number for what you think Bitcoin and Ethereum will be worth by the end of the year, what would it be?
OHANIAN: At the end of the year, Bitcoin will be at $20,000. And Ethereum will be at $15,000. [Note: After publication, Ohanian said he misspoke. He meant to say Ethereum will be at $1,500.] Great, now people can call me out if I’m wrong.
At Initialized, you’re working on rolling out a new data-driven investing platform. The goal was to increase deal flow diversity and help founders gain access to the firm’s network. How is that project going?
OHANIAN: We’ve spent the better part of this year understanding our networks internally. Between and Garry, we have a lot of networks, but often the relationships of those networks are unclear. So the key step was aggregating those networks and figuring out who are the people we vouch for. And for the second version, we’re working on a more searchable version of this to roll out to our most trusted founders in the network.
In other words, the goal is to narrow down the best people to be working with — whether it’s a company that needs to hire someone or whether it’s someone we want to invest in. The challenge is how to make sure we’re going beyond the people who are thinking of emailing us. Who are the founders we’re not looking at but should be? As VCs, we need to use software to help us catch our blind spots.
这篇文章最初发表在《财富》关于交易和交易撮合者的通讯单上。在这里注册。二月，ReDDIT联合创始人Alexis Ohanian表示，他将辞去公司日常工作，重返投资领域。OHANIAN现在是初创公司的全职，是他2012年初与Garry Tan共同创办的早期风险投资公司。该公司在管理下拥有超过2亿5000万美元的资产，其投资包括Cin Basic、SimaCART、ZeNeSIT、OpenWORE、SOLYNT、巡航自动化和标准认知。“我仍然使用ReDIT来发现迅速发展的趋势，”Ohanian告诉学期表。“这是为什么Initialized是Coinbase第一张支票。例如，你可以看到这些趋势在R/Bitcoin上流行。早期的有机社区是真正意义上的焦点团体。”Ohanian，她最近有一个妻子和网球冠军小威廉姆斯的女儿，花了16个星期的父母。在决定离开ReDIT的操作角色之前离开。在与学期表的对话中，奥哈尼亚讨论了他在投资前寻找的一个创始人的元素，他的隐秘观点，以及他在内部建立的新数据驱动的投资平台。这个Q＆A已经编辑的长度和清晰度。学期表：你离开了ReDIT的职责，专注于初始资本。为什么现在？奥哈尼亚：我们现在正处于一个有趣的时刻。这是第一次互联网上的事情，我只是一个孩子在我父母的房子建设网站，但我不能有很大的影响。现在，感觉在未来10年开始的创新将会对世界产生巨大的影响。在过去三年里，我为扭转ReDIT所做的一切而感到自豪，但我认为，一家公司对我的影响与我能在数十家规模巨大、价值数十亿美元的公司中投资的潜力有关，这也是我下一个十年的目标。在投资之前，你在公司或创始人中寻找哪些关键因素？奥哈尼亚：必须有一个无情的创始人。有一个想法很容易。打印一些名片很容易。当它开始变得困难的时候，当你开始测试你的想法的某个版本，在客户面前得到它，然后发现他们不愿意购买你的产品。尽管我们与早期的创业者合作，但很早就有明确的迹象表明他们能够建立什么，而不是他们能谈论什么。这有很大的不同。我在寻找基本的东西——创办人能在最后期限前完成吗？但我也在寻找更复杂的东西——他们能在一个充满不确定性的世界里工作吗？没有创业精神的教学大纲。你告诉我，你计划在新兴技术比如BigStand上翻倍投资机会。你对目前的密码和封锁链发生了什么看法？OHANIA:去年，它都是关于人工智能和机器学习的，今年，都是关于BuffStand的。大部分都是炒作和BS，就像AI和ML是怎样的一样。在软件和BuffLink周围，最重要的、协议级的、基本的基础设施需要在未来一两年内建立起来，让我们真正看到我们真正希望的Web 3。这就是我们现在投资的公司类型。这些类型的东西，我认为将建立一个非常不同的，更好的互联网的基础。我是一个90年代的孩子，没有太多的杠杆，当第一个互联网正在建设，所以我认为这是一个地狱般的机会。我们还在想办法。我们还没有Netscape，但它来了。有趣的是，我们看到了更多的商业和产品背景的团队正在开始或加入BooStand项目。所以你有最早的使用者，他们在工程方面是非常核心的，现在我们开始看到有经验的人在后来的初创公司了解UX和业务部分。除非每个人都在使用这个东西，否则它不会真正改变世界。每个人使用它的方式是，如果有界面是有意义的，并且产品是美丽和有效的。现在才刚刚开始。作为一个投资者，我有一个前排座位，以这个新的互联网。CONBASE最近向SEC登记注册经纪业务。加密市场仍处于“疯狂西部”阶段，你认为监管会是什么样子？奥哈尼亚：现在看来，我们在美国的监管环境很低。我会感到惊讶的是，除了轻触之外，什么都没有。这是很重要的，因为有很多江湖郎中已经进入这些最初的硬币产品作为一个快速致富的方案。这令人沮丧，因为它破坏了真正的创新技术。这些人应该受到惩罚。希望的是，你可以做足够的惩罚现有的坏演员和阻止未来的，但你也必须确保你不把婴儿与洗澡水。你认为比特币会有多高？奥哈尼亚：去月球。[笑声]我仍然持有一点点比特币，我认为它有这样的心态，它将继续成为一个价值商店。我对EythUM最看好，因为人们实际上是在构建它。现在还很早，但你知道，我们有一些密码学。[密码学]是一种基于块链的游戏，允许用户购买、收集、繁殖和销售虚拟猫。它背后的公司从包括Andreessen Horowitz和联合广场创投在内的投资者那里筹集了1200万美元的风险投资。我们没有投资，但他们筹集资金的一点也不让我吃惊，因为他们有了第一个真正的应用。笑起来很容易，但我认为很多东西的第一个版本看起来像玩具，而且经常与猫有关。这是因为互联网喜欢猫。我想我知道原因。你想知道为什么吗？为什么？OHANIA:猫之所以在互联网上如此受欢迎，是因为猫主人从来没有和其他猫主人一起做猫主人的事情。直到互联网出现。哇哦。你不是开玩笑，你真的有一个理论WAPP603015QToOHANIA:是的。这一切都是真实的，记录在案。狗主人把狗带到狗公园，狗互相玩耍，主人们讨论这个芯片昨天做的非常可爱的事情，他们做狗的结合。但是我没有一个猫公园带我的猫去。所以我们没有办法在网上聊天和谈论我们愚蠢的小事。我看到很多这样的事情发生在我的眼前，几年前它终于被点击了。所以，如果你给一个大概的数字，你认为Bitcoin和Ethereum在年底会有什么价值，那会是什么？奥哈尼亚：在今年年底，比特币将达到20000美元。Ethereum将达到15000美元。[注：出版后，Ohanian说他说错话了。他的意思是说Ethunm将是1500美元。太好了，现在如果IWPA60607QTEM错了，人们可以打电话给我。在Initialized，你正在努力推出一个新的数据驱动的投资平台。其目的是增加交易流量的多样性，帮助创始人获得公司网络的访问权。那个项目进展如何？奥哈尼亚：我们在今年的大部分时间内都在理解我们的网络。在Garry和我们之间，我们有很多网络，但是通常这些网络的关系还不清楚。所以关键的一步是整合这些网络，找出我们所承诺的人。对于第二个版本，我们正在开发一个更可搜索的版本，以向网络中最值得信赖的创建者推出。换句话说，我们的目标是缩小与之合作的最佳人选——无论是需要雇佣某人的公司，还是我们想投资的人。我们面临的挑战是如何确保我们超越那些想给我们发电子邮件的人。谁是我们不看但应该是的奠基人？作为VCs，我们需要使用软件来帮助我们抓住盲点。
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