ACQ2 Episode Summary: Joe Montana Interview Live from Modern Treasury Transfer
Podcast Information:
- Title: ACQ2 by Acquired
- Host/Authors: Ben Gilbert and David Rosenthal
- Episode: Joe Montana Interview Live from Modern Treasury Transfer
- Release Date: August 20, 2024
Introduction
In a compelling episode of ACQ2 by Acquired, hosts Ben Gilbert and David Rosenthal engage in an in-depth conversation with legendary NFL quarterback Joe Montana. Recorded live at Modern Treasury's Transfer Conference, the interview delves into Montana's transition from a celebrated football career to a prominent venture capitalist, exploring the parallels between sports and investing, team building, leadership, and his investing philosophies.
Joe Montana’s Journey from the Gridiron to Venture Capital
From Football Stardom to Liquid2 Ventures
Joe Montana, renowned for his illustrious 16-year NFL career with the San Francisco 49ers, transitioned into the world of venture capital by founding Liquid2 Ventures in 2015. Under his leadership, Liquid2 has launched six funds, investing in over 800 companies with an aggregate portfolio value surpassing $100 billion. Notable investments include GitLab, Anduril, Rippling, Rappi, Mercury, Retool, and Modern Treasury.
Notable Quote:
Ben Gilbert [01:57]: "Joe needs literally no introduction..."
Joe Montana [01:57]: "So Joe has quite the post-football career that we're gonna spend most of our time talking about."
Transition Insights
Montana attributes his successful transition to the team-building lessons learned from his NFL days, particularly under coach Bill Walsh. He emphasizes the importance of assembling a diverse and skilled team to foster agnostic investments across various sectors.
Notable Quote:
Joe Montana [02:25]: "I learned a lot of things from Bill Walsh, but the one thing I took to heart is I watched him put together the 49ers... It just came to, I look to we have a large team for the small or the size of our funds."
Team Building and Management Philosophy
Emulating Sports Team Dynamics
Drawing parallels between NFL team dynamics and venture capital, Montana highlights the significance of diversity and specialization within his team. Liquid2 operates with five partners, allowing for a broader investment perspective and deeper sector expertise.
Notable Quote:
Joe Montana [03:46]: "Well, we don't try to run in and take and lead... we're more of a friendly foe than anything."
Equal Partnership Model
Montana employs an equal partnership model at Liquid2, ensuring all partners receive the same compensation and carry. This structure fosters collaboration and minimizes conflicts over individual contributions.
Notable Quote:
Joe Montana [31:14]: "We try to get at least two partners on every deal and usually try to get as many as we can get eyes on deals and there's no bickering over, well, I brought in more capital..."
Leadership and Investing Philosophy
High Standards and Performance
Adopting Bill Walsh’s philosophy, Montana maintains high standards for his team, believing that aiming for perfection allows achieving top-tier performance even if some goals are missed.
Notable Quote:
Joe Montana [41:22]: "Bill's philosophy always was, hey, if you aim to be perfect and you miss, you can still be pretty good."
Focus on People and Relationships
Montana emphasizes the importance of investing in people, leveraging his extensive network to support repeat founders and fostering long-term relationships within the venture ecosystem.
Notable Quote:
Joe Montana [40:11]: "A lot of people are betting on people. And because of our portfolio so large, we get repeat founders..."
Insights on Team Culture and Incentives
Building a Respectful and Collaborative Culture
Montana credits much of his team’s success to the respectful and inclusive culture inspired by Bill Walsh. He ensures that every team member, regardless of role, is treated with equal respect, fostering a unified and motivated team environment.
Notable Quote:
Joe Montana [32:10]: "He says, when somebody walks in that door in that locker room, they're part of the 49er team and organization. You treat them and you treat the people upstairs."
Incentive Structures and Control
By separating economic incentives from control, Montana ensures that decisions are made collectively without conflicts over individual contributions. This structure promotes fairness and collaboration within the team.
Notable Quote:
Joe Montana [32:55]: "I just owned the management company. That's all. I controlled where all the money goes."
Reflections on the NFL Draft and Team Selection
Challenges in NFL Draft Predictions
Montana discusses the complexities of NFL draft selections, questioning the efficacy of extensive resources and media influence in accurately predicting quarterback success. He highlights the intangible aspects of leadership and game intelligence that are often overlooked.
Notable Quote:
Joe Montana [06:34]: "They just lose sight of turning on the video and watch the video... it's hard to tell whether who's going to make that transition."
Comparisons to Investment Decision-Making
Drawing a parallel to venture investing, Montana compares the unpredictability of draft outcomes to the challenges of selecting successful startups. Both require keen judgment and the ability to identify potential beyond surface-level metrics.
Personal Anecdotes and Stories
Building Liquid2 Ventures
Montana shares personal stories about the early days of Liquid2 Ventures, including the dedication and sacrifices made by his initial partners who worked without pay for months. These anecdotes illustrate his commitment to building a strong foundation for the firm.
Notable Quote:
Joe Montana [25:19]: "Yeah. And so, but eventually, you know, these guys, they had never invested before... One company was in mobile feedback space, got bought by Google."
Influence of Ron Conway
Montana discusses his relationship with venture capitalist Ron Conway, highlighting how Conway’s mentorship and connections significantly influenced Liquid2’s growth and investment strategies.
Notable Quote:
Joe Montana [28:03]: "After a while it became... we had venture leverage, buyout hedge and real estate funds and all we did was raise money. So the fund of funds was no fun."
Advice to Founders and Entrepreneurs
Embracing Instinct and Seeking Help
Montana advises founders to trust their instincts and not hesitate to seek help when facing challenges. He emphasizes the value of supportive investors who are willing to assist promptly, ensuring that issues are addressed before they escalate.
Notable Quote:
Joe Montana [44:39]: "I think one of the lot of things you have to go with like your instinct and your gut and a lot of people are afraid to ask for help."
Collaborative Support System
By offering a collaborative support system, Liquid2 ensures that founders have access to necessary resources and expertise without the intrusive control typical of larger venture firms.
Notable Quote:
Joe Montana [44:39]: "We're in the boat together. You're driving. If you need help, just let us know. We'll help you steer and get to the right place that you need."
Conclusion and Closing Remarks
The interview concludes with Montana reflecting on his multifaceted career and the lessons learned from both football and venture capital. His insights into team building, leadership, and investment strategies provide valuable guidance for aspiring entrepreneurs and investors alike. Ben Gilbert and David Rosenthal thank Montana for his candid participation, highlighting the enriching nature of the conversation.
Notable Quote:
Ben Gilbert [46:42]: "Well, Joe, this has been a great conversation. Thank you so much."
Final Thoughts
Joe Montana's journey from NFL legend to successful venture capitalist underscores the importance of teamwork, strategic thinking, and adaptability across different fields. His experiences offer a unique perspective on building and managing successful enterprises, making this episode a must-listen for anyone interested in the intersection of sports, business, and investment.