Today’s Menu ☕️

• Austin Tech Breakfast Club SEPT 24TH

• SF Tech Breakfast Club SEPT 26TH

• NYC Tech Breakfast Club Oct 10th

• LA Tech Breakfast Club OCT 14TH

• El Segundo Tech Breakfast Club OCT 15TH

• Dreamforce Tech Breakfast Club SEPT 17TH

• Arash @ Venture Commercial

• Will McKelvey (Lerer Hippeau) Interview

👋 Hi, Breakfast Club Members!

Thank you to Arash at Venture Commercial for sponsoring this edition. Looking for office space in NYC? Talk to Arash

I’m Morgan Barrett, creator of Tech Breakfast Club. I host breakfast meetups in NYC, LA, SF, (and occasionally Austin, Miami, Boston) that bring together the best founders and investors.

If you’re a VC who wants to get involved, shoot me an email (reply to the newsletter). It’s been an awesome sourcing channel for many of the core Tech Breakfast Club members.

Tech Breakfast Club Events

Austin Tech Breakfast Club SEPT 24TH
Tech Breakfast Club returns to Austin against the advice of my doctor (I have high cholesterol and can’t say no to brisket).

Cohosting with Harry Campbell and Colin Gardiner, two of my favorite early stage investors and hosts of the Wannabe Angels Podcast.

SF Tech Breakfast Club SEPT 26TH
Cohosting with brilliant early stage investor, Anna Piñol (NFX).

SF Tech Breakfast Club (SF Tech Week) OCT 8th
Cohosting with the legendary Riley Finch from Next Gen Venture Partners

NYC Tech Breakfast Club OCT 10th
This very special Tech Breakfast Club has been almost two years in the making - cohosting with long time Tech Breakfast Club member (one of the earliest adopters) Emily Herrera from Slow Ventures 

LA Tech Breakfast Club (LA Tech Week) OCT 14TH
Cohosting with Espree Devora for LA Tech Week. Espree is the best - she introduced me to Beehiiv and has made me a lot of money (on paper)! We’re blowing it out for LA Tech Week.

El Segundo Tech Breakfast Club (LA Tech Week) OCT 15TH
So many surprise guests for this Tech Breakfast Club - you do not want to miss this. Fly to LA for this. It’s conveniently located next to LAX. Cohosting with Jacques Sisteron from Upfront.

Special Edition Tech Breakfast Club for Dreamforce
Tech Breakfast Club GTM Edition (by Clay) SEPT 17TH
So excited to partner with Clay, the go to solution for Go To Market teams looking to scale their outreach, for a very special Tech Breakfast Club during Dreamforce in SF. If you’re GTM focused, come join!

Arash (Venture Commercial) 🤝 Tech Breakfast Club

If you haven’t already met Arash from Venture Commercial – you should!

He’s the go to tenant rep for NYC startups. Whether it’s coworking space or an insane office buildout for your growth stage startup, he should be your first call.

Arash is going to make your life 10x easier so you can get back to building you company – and because he only reps tenants' (never landlords!) you can have confidence he’s getting you a great deal.

Give him a follow on LinkedIn or shoot him an email: [email protected]

Member Spotlight
Will McKelvey Infiltrates VC

If you come to Tech Breakfast Club in NYC, you probably know Will McKelvey (Lerer Hippeau). We recently cohosted TBC (along with Lauren Corcoran) and I have to say - he’s a world class hang and a deal sourcing machine.

And like all great VC’s, he grew up on a farm, went to a big state school, and worked in politics… wait what? Really nothing about Will’s background makes sense for why he’s been able to get into VC and excel. But the guy is determined and whatever he wants to do, he’ll find a way.

I know you’re from Ohio but give me the full origin story 
I grew up on a farm in Ohio, outside of Dayton, with llamas and chickens. I went to Ohio State for undergrad... startups and venture capital were pretty foreign. “Venture” and “capital” were just two words – next to each other, they didn't have meaning for me until probably 2017 or 2018.

What changed?
After college, I went to Washington, DC, and I worked in Congress for this guy named Ro Khanna

The bay area congressman!
Yeah, so I joined his team right after he got elected in 2016 and became his economic and healthcare policy advisor. I sort of got this window into this world – I saw that startups and venture capital were incredibly impactful from my economic policy lens. 

I remember reading a Brookings Institute paper on the impact of venture and venture backed companies. 

It made the point that it accounts for 0.2% of GDP. 

Yeah we lose sight that it’s a tiny asset class
But venture backed companies over the last 25 years created 11% of new jobs and 20% of GDP growth. And that’s stuck with me ever since. If I want to be impactful...and I actually care about impact, venture backed companies are the place to be 

Wow, that’s insane. Shoutout to the Brookings Institute. We love a think tank 
That was actually a pivotal moment in my career. I decided to step back from my budding career in politics, leave DC, and go to business school. I didn’t know anything about business. I wanted to go to Silicon Valley and learn about what it takes to build a company. So I enrolled at UC Berkeley and began trying to figure out a way to get into venture. 

Every MBA wants to get into Venture, but you actually did it – how? 
I partnered up with a few of my classmates and raised a small venture fund. We raised $1.7m to write checks into startups coming out of the Berkeley ecosystem.

It’s hard to break into venture...

Yeah, I think the classic advice is to get the job, you have to start doing the job. Nobody wants to do that. You found a way to start doing the job, leveraging your two years at business school. I’ll also say that 2023 – it went from the best time ever to break into venture to the worst time...
Yeah it was tough. But it helped having a small fund. My second year, I skipped a week of classes and crashed on a buddy’s couch here in New York. I set up a ton of meetings with VC’s (none of which were Lerer Hippeau, where I’d eventually get a job). I’m sure these VC’s all had a million mba’s flooding their LinkedIn dm’s, so I framed the meetings as chatting VC to VC – that I could give them access to the Berkeley ecosystem – even though I was still pretty far from being a real VC. I focused on leading with value and making the ask later on. 

All the groundwork I laid paid off a couple months later when Lerer Hippeau posted a job. Nick Chirls, then at Notation capital who has since launched Asylum Ventures, was kind enough to introduce me. And I think LH felt high conviction, almost like when they invest in a founder, because they moved so fast. I interviewed with 7 people at the firm over 2 weeks and got the job offer just a week before I graduated. 

Hell Yeah 
And this is kind of a hot take – but I wanted to go back to your point about the market being way tougher in general now. I think that the hard times of 2022 and 2023 are and will continue to be good for the ecosystem. It was unhealthy for multiple years... and the easy money was going to destroy everyone’s returns and destroy the asset class. It led to a lot of startups getting screwed. I’m glad it’s harder now. It should be hard to raise a fund. This is an alternative asset class and should be a small part of the bigger financial world. 

For it to work, the opportunities need to be on the fringe with massive upside. There are lots of businesses that can be successful but only a small number of them should be taking on venture capital. 

When I asked about your investing thesis, you told me you love backing founders with a chip on their shoulder 
There is a lot of value in harnessing negative emotionality and negative feelings and turning that into positive outcomes for the world. 

You think about someone like Barack Obama. He had a poor relationship with his father and wrote about it in Dreams from My Father. He used it as fuel to dig deep and have an impactful political career, overcoming a lot of adversity. 

Give me some other chips on shoulders motivation you’ve seen with founders 
The one I see most often, from second time founders, is over-financing their first company. They raised a bunch of money. They built what could have been a great business but didn’t have a great outcome because they weren’t as disciplined as maybe they would have been in a tougher environment. 

They got close before – they might have been rich on paper. Now, the second time around, they’re out for vengeance. They come in 10x better founders. I love a bitter founder. 

Are you a bitter VC? I think of you as such a joyful guy
Hah, well, I think about myself, you know, coming from a farm, going to Ohio state, working in politics... and I look at everyone else in this field and they went to all the right schools and had all the right jobs. There are more VCs who went to a handful of fancy high schools than who went to Ohio State. I like being an underdog. Personally, I feel motivated to prove everyone wrong who discounted me at the outset.  

You’re already crushing it – you’ve been at Lerer Hippeau for a little more than a year and already been promoted. Tell me about some of the deals that you’ve sourced. 
My most recent investment, which isn’t public, but I’m really excited about – 

Yeah just discuss it at a high level if you can 
Former founder, raised a lot of money for his previous endeavor and it didn’t work out as he’d hoped. He has some scars from the experience. Super strong technical founder solving a hard technical problem in AI applied to hardware. 

If he’s right, this will be a $50 billion company. It’s the type of founder and the type of binary outcome I’m looking for. 

What else are you excited about?
I’ve been thinking a lot about non-technical moats recently. Software is becoming commoditized so things like brands, marketplaces, network effects, etc. are going to matter more in the future. When you lose technical differentiation you have to be more creative when it comes to building up defensibility.

A great example (for now) is Harvey, the AI legal software. In situations like the law where trust matters, being first, having a product that works, and having a reliable name/brand – you can dominate. In a lot of these B2B verticals, users don’t want to try a bunch of products. They just want to use what works and if they recognize your name and you’re in front of them, you’ve won. 

I mean, like Salesforce, for example – it’s expensive, overbuilt, borderline not usable at this point, but it’s the system of record for a ton of companies. It’s incredibly hard to replace. Or shopify – it’s not a technically world-changing product by itself but you have this huge ecosystem of third-party applications. If you’re going to build a brand, you can just trust that Shopify is going to give you all the tools to do that. 

Bringing it back to brand – what’s Lerer Hippeau’s brand?
Founder first. We’ve been around for 14 years as preseed and seed investors. We’re true generalists but the one unifying thread of all of our investments is deep deep deep conviction in the founding team. When you invest this early, we know the vision will evolve. So the market is secondary, but still important. Ultimately, it’s the founder that matters. 

All of the conference rooms at our office are named after portfolio companies that pivoted. I’m sitting in Romotive, which is named after a toy company we invested in a decade ago that eventually pivoted and became Zipline, now a $4 billion drone logistics company. But we had high conviction that Keller, the founder, was going to figure something out. 

Hah, the classic toy to drone logistics pivot. I’ve seen that a dozen times
[Polite Laughter]

Yeah, so we're on our eighth seed fund. We've got 1.2 billion in AUM, but we keep our funds purposefully modest. So our current fund is $145 million and we're writing 500k to $3 million checks at pre seed/seed usually leading or co-leading those rounds. Looking for about 10% ownership. We work well with other investors. I’m a senior associate. We have two analysts, two partners, and three managing partners. The team is very flat, though, we all have license to pound the table and drag deals across the finish line.

No consensus necessary?
Consensus is where deals go to die 

What else do you like to do? 
I’m very competitive. I’m always down to play beach volleyball, softball, and pickup basketball. I’m a big reader and like to write. But my favorite thing about New York is when you leave your apartment at like 10:30am on a Saturday to grab coffee with a friend and end up doing like six or seven spontaneous things throughout the day, returning home at 2am. I love saying yes to experiences. 

Yeah, checking your credit card trying to figure out how you spent $500
Exactly, hah, there's so much to enjoy about New York

About Morgan
Morgan, besides running Tech Breakfast Club, is a Startup Lawyer at Optimal, an elite lean boutique startup law firm repping clients funded by a16z, Sequoia, Kleiner, Accel, and countless other VCs. He works with clients from formation to exit, in collaboration with Optimal’s partners.