Episode Summary
Executive Summary: Roy Bahat announces Bloomberg Beta’s third $75M fund, unchanged in strategy: focus on the future of work, invest as early as possible, and treat the founder as the customer. The conversation explores trust, diligence, pricing, ownership, boards, secondaries, scout programs, and how VC should serve founders with transparency, speed, and empathy.
Main Topics: Bloomberg Beta’s third fund and unchanged strategy (Priority: 5/5): Roy announces Fund III, a $75M vehicle that continues the same thesis and operating model as prior funds: early investing in the future of work and founder-first service. Founder-as-customer philosophy and trust-building (Priority: 5/5): Roy argues that VCs should optimize diligence for founder benefit, build trust gradually, and avoid extractive behavior like premature customer calls or opaque processes. Fund size, pricing, and valuation as a dependent variable (Priority: 5/5): He explains that valuation is driven by fund size, check size, ownership targets, and strategy—not an objective ranking of company quality. Competition, speed, and deal selection in seed investing (Priority: 4/5): Roy discusses competing with large multi-stage funds, the importance of being early and decisive, and why Bloomberg Beta often aims to be the first yes. Portfolio support, boards, and governance at early stages (Priority: 4/5): He says early boards can be unnecessary or even distracting, while the fund focuses on serving founders through transparency, rapid support, and selective board involvement later. Founder wellbeing, secondaries, and the human side of VC (Priority: 4/5): Roy emphasizes that founders face intense pressure, may need liquidity or support, and that investor behavior should reflect compassion and awareness of personal circumstances. Open angels, scout transparency, and ecosystem ethics (Priority: 3/5): He defends transparent angel programs, criticizes opaque scout programs, and values founder angels and broader ecosystem participation as long as incentives are clear.
Key Arguments: Bloomberg Beta’s third fund is intentionally the same as the first two because the model has proven effective and still fits the firm’s thesis. Fund size determines strategy, which in turn determines valuation and ownership targets; valuation is mostly a result, not an independent judgment. VC diligence should be designed to help the founder, not merely maximize investor speed or curiosity; customer calls should happen late to protect founder trust. Great investors should lead with the hardest issue first, especially competition or price, so founders can decide quickly and fairly. Being the first yes can matter, but winning on price alone is not the goal; the firm wants to be the best dollar on the cap table for the founder. Successful founders often face increasing pressure rather than easier lives, so investors must stay attuned to moments of distress and respond generously. Early-stage boards are often more overhead than help; governance should match the stage of the company and the nature of decisions being made. Liquidity events like founder secondaries can be healthy when they reduce distraction and financial stress, especially if communicated with trust and context. Transparency matters in scout programs and capital sources; founders should know who is really behind the check. The industry’s role models should be more humble, diverse, and globally aware, because pure financial success is a poor proxy for good leadership.
Data Points: Bloomberg Beta Fund III size: $75 million - Roy says the new third fund is the same size as the previous one and follows the same strategy. Number of Bloomberg Beta funds: 3 - The announcement is for Bloomberg Beta’s third fund. Bloomberg Beta tenure: 7 years - Roy describes himself as a seven-year venture capitalist. ActiveCampaign customer count: 80,000+ companies - Sponsor mention in the intro and outro. Intercom Unity uplift: 45% more customers - Sponsor example of Intercom improving conversion over 12 months. Early cancer detection statistic: 50% - Sponsor mention that 50% of all cancers are detected late. Survival advantage of early detection: 4x more likely to survive - Sponsor mention on the benefit of early cancer detection. Ezra scan price: $1,950 - Sponsored mention of full-body MRI pricing. Ezra installment plan: as little as $180/month - Sponsored mention of financing options. Discount for listeners: 10% off - Ezra listener offer via code/landing page. Fundraising on Kickstarter for Oaya: $8.6 million - Roy’s prior company Oaya raised this amount on Kickstarter. Total capital raised by Oaya: over $33 million - Roy mentions the company raised from Kleiner, Alibaba, and Kickstarter. Investment in State's Title: $1 million (approx.) - Roy says they signed to invest in Max Simcoff’s company that same day, with the exact amount described colloquially.
Pivotal Quotes: "The founder is the customer, let's treat that as religion." — Roy Bahat: Explaining Bloomberg Beta’s operating philosophy and why diligence should serve founders. "Valuation is a dependent variable." — Roy Bahat: Describing how fund size, ownership targets, and check size drive price rather than the reverse. "We are today announcing our third fund and the exciting news is that it is precisely the same." — Roy Bahat: Announcing Bloomberg Beta Fund III and emphasizing strategic continuity.
Implications: For founders, the episode argues for choosing investors who are transparent, fast, and genuinely supportive—not just brand-name or highest-price investors. For VCs, it reinforces that fund strategy, trust, and empathy shape outcomes as much as capital does.