Mitchell Green - Lessons from Cold Calling 10,000 Companies - [Invest Like the Best, EP.464]

Summary

Podcast Summary: Invest Like the Best with Patrick O’Shaughnessy

Episode 464: Mitchell Green – Lessons from Cold Calling 10,000 Companies

Date: March 24, 2026
Host: Patrick O’Shaughnessy
Guest: Mitchell Green, Founder of Lead Edge Capital

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1. Episode Overview

This episode features a detailed conversation with Mitchell Green, founder of Lead Edge Capital, a growth equity firm known for its unique approach to private market investing and assembling one of the most distinctive LP networks in the industry. The discussion focuses on the business “machine” Green and his partners have built, lessons from cold calling thousands of companies, the mechanics of sourcing and evaluating deals, and how to maintain consistency in investment returns without swinging for the fences. Other themes include culture-building, selling discipline, leading with empathy, and the impact of AI on investing.

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2. Key Discussion Points & Insights

A. The Origin and Philosophy of Lead Edge Capital

• Lead Edge Capital operates more like a disciplined software company than a traditional investment firm. They systematize sourcing, diligence, and relationship management to a degree unusual in the investing world.
  • "We run this place like it’s a software company." (Mitchell Green, 06:09)
• Their main KPI is LP (Limited Partner) retention, aiming for >95% gross dollar retention, focusing heavily on client service and long-term returns.

B. Lessons from 10,000 Cold Calls

• Green and his team built their sourcing muscle through mass outreach, which developed their pattern recognition and instilled discipline:
  • "If you want to know what’s a good company, just call 10,000. You’ll figure out really quick." (Mitchell Green, 03:52)
• Key takeaways from cold calling:
  • Responsiveness of CEOs often correlates with company quality.
  • Following through on promises distinguishes investors in a crowded field.

C. The "Machine" Behind Lead Edge

• The firm uses young analysts to call 9,000+ companies annually, filtering down to 5–7 investments per year using a rigorous criteria framework ("Lead Edge 8").
• Unlike many VC or PE firms, Lead Edge is agnostic about liquidity path and works creatively to access deals (e.g., direct, secondary, structured).

D. Unique LP Network and Its Impact

• 95% of LPs are world-class executives and entrepreneurs, deliberately designed to enhance sourcing, diligence, and post-investment value creation.
  • "If you want 95% retention, that’s what you need to do because they’re your clients." (Mitchell Green, 08:15)
• This network is deeply involved across all stages: introductions, due diligence, reference checks, and customer/partner engagement for portfolio companies.
• Maintaining high retention with LPs is relational, not just performance-based.

E. Investment Criteria ("Lead Edge 8")

[18:09] – The Eight Criteria Highlights:

1. $10MM+ in revenue (for product-market fit)
2. 25%+ annual growth (no pre-revenue startups)
3. 70%+ gross margins
4. Recurring revenue
5. Capital efficiency (revenues exceed historical cash burn)
6. Profitability
7. Low customer concentration
8. Returns to growth
   • "If you can build a business that’s growing nicely while burning less than your revenues, you’ve got a pretty good business." (Mitchell Green, 19:16)

• Not every investment checks all 8 boxes; usually, 5+ is sufficient to make the shortlist for further diligence.
  • "The criteria aren’t predictive, but it gives us a framework for what to focus on and what not to focus on." (Mitchell Green, 29:17)

F. Deal Sourcing and Creativity

• The team is flexible on how capital is deployed: direct investments, structured secondaries, employee liquidity, etc.
  • "We’ll buy 10%, 80% LPs out of a 20-year-old fund, buy employee secondary, CV. We don’t care, we’ll do anything." (Mitchell Green, 08:05)
• Example: To get into Zoom before IPO, they creatively approached LPs in funds that owned stock, rather than buying directly from major VCs (25:11–27:12).

G. Selling Discipline and Portfolio Management

• Lead Edge emphasizes knowing when and how to exit, not just when to buy.
  • "The fastest way to get fired at Lead Edge is have a company and not tell us when there’s a liquidity opportunity." (Mitchell Green, 14:26)
• Holds typically average 3.5–4 years, opportunistically using secondaries as well as IPOs.
• "We’re like Cal Ripkin doubles and triples, we're not Sammy Sosa–like Mark McGuire. It's all about hitting doubles and triples." (Mitchell Green, 12:28)

H. Culture, Process, and Internal Practices

• Hands-on, top-down culture established by personal example: handwritten notes, follow-ups, and ongoing personal connections.
  • "If you just treat people the way you want to be treated, that just flows." (Mitchell Green, 35:04)
• Mitchell personally conducts annual one-on-ones with every employee, harvesting insights and building connection.
  • "Sit down with every employee, survey, what you love/hate, ideas—we actually learn a ton doing that." (36:59)
• Culture encourages entrepreneurial learning, LP relationship-building, and giving even young analysts responsibility.

I. Approach to Markets & AI

• Mitchell is optimistic but cautious about overhyped sectors, especially with respect to AI and tech bubbles.
  • "AI is going to change the world in ways nobody can think about...but I’m most fearful for what I don’t know." (Mitchell Green, 42:50)
• The firm now scores their portfolio companies on “AI readiness” and fosters connectivity between AI-forward and lagging founders.
• Concerned about AI capital expenditure bubble and potential commoditization of AI models; believes Big Tech incumbents have the edge (46:32).

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3. Notable Quotes & Memorable Moments

• On Sourcing Discipline:
  "If you tell an entrepreneur that you’re going to actually do something, then actually do it. I think that’s actually true of your life. There are so many people that say they’ll do things that just never do them." – Mitchell Green (04:54)
• On Culture:
  "Being a good person is not that hard. Frankly, in a world that’s insanely competitive, if being the nice guy gets you the callback and being the helpful person, then do it all day long." – Mitchell Green (37:04)
• On Selling:
  "We constantly are underwriting, like, what’s a forward net return? ... It’s about underwriting the forward IRR." – Mitchell Green (15:42–16:59)
• On Repeatability:
  "Our biggest mistakes have honestly been not swinging at the pitches when they were in our strike zone." – Mitchell Green (29:23)
• On Entrepreneurship:
  "Just go do it... I encourage people, if you want to do it your own way, there’s no better time than now. What are you waiting for?" – Mitchell Green (51:42)
• On AI Bubble:
  "I believe this AI capex bubble will end badly... that presents the opportunity. That’s when you’re going to buy these companies." – Mitchell Green (45:33)
• On Drive and Persistence:
  "I just put my heart and soul into everything I do, whether it’s racing cars... or how I run Lead Edge. I probably sleep five hours a night... because I love what I do." – Mitchell Green (48:42)

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4. Timestamps for Important Segments

• 03:06 – What Lead Edge looks for: the origin of their criteria and communication style
• 04:54 – Lessons from cold calling 10,000 companies
• 06:09 – Building Lead Edge as an investment “machine”
• 08:15 – Unique LP network: rationale and mechanics
• 12:28 – The focus on doubles and triples (not grand slams)
• 13:34 – How Lead Edge approaches selling and portfolio management
• 18:09 – The Eight Criteria for investment
• 25:11 – Creative deal structures: Case study of Zoom secondary
• 29:17 – Why criteria matter: creating a strike zone rather than predicting performance
• 35:04 – Culture-building practices and personal leadership style
• 36:59 – Annual one-on-ones: feedback and execution
• 42:50 – AI: excitement, fear, and long-term impact
• 46:32 – AI bubbles and tech market overhype
• 48:42 – Mitchell’s drive, competitiveness, and formative influences
• 51:42 – Advice on starting a fund and the importance of entrepreneurship

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5. Flow & Tone

The tone throughout the episode is candid, energetic, and process-driven. Mitchell Green’s style is direct, open, and rooted in both humility and high performance. The conversation balances practical details (e.g., cold calling, deal mechanics) with philosophical reflections on culture, entrepreneurship, and the evolving tech landscape.

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6. For Further Exploration

• Lead Edge’s Approach: Their combination of cold-calling, rigorous process, LP leverage, and humble consistency presents an alternative to the often swing-for-the-fences mindset in tech growth investing.
• Culture & Management: Top-down cultural habits—personal touches, annual feedback sessions, and transparent responsibility—are recurring themes.
• AI & the Future: Despite optimism, caution permeates the AI discussion, with Mitchell urging preparedness for both upside and unintended consequences.
• Unique Take on Competition: Green’s respect for machine-like peers (Insight, TA, Excel-KKR) underscores the importance of repeatability and process excellence in private investing.

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Closing Question & Memorable Answer

[53:26]
Q: "What's the kindest thing that anyone's ever done for you?"
A: "Pete Wilmot...was the first person that ever believed in me. I was like 19...he became an investor...the company completely failed...but when I was trying to get my first job, he was my reference and basically told the person they were insane if they didn't hire me because I was the most persistent person he’d ever met. So that’s probably the kindest thing I’ve always ever done." – Mitchell Green

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This summary provides a comprehensive, time-coded breakdown of the episode’s themes and content, offering both practical takeaways and flavor for those who haven’t listened to the conversation.

Transcript

[Patrick O'Shaughnessy]

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[Mitchell Green]

the CEO of Positive Sum. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Positive Sum may maintain positions in the securities discussed in this podcast. To learn more, visit Psum VC

[Interviewer]

My guest today is Mitchell Green, the founder of Lead Edge Capital.

[Patrick O'Shaughnessy]

When I think about Lead Edge, I

[Interviewer]

sort of think about this giant money machine that Mitchell and his two partners

[Patrick O'Shaughnessy]

have designed over the last 15 plus years to make remarkably consistent investment returns for their clients.

[Interviewer]

They have all sorts of unique aspects to the machine that they built, whether that's their collection of LPs, their eight

[Patrick O'Shaughnessy]

point criteria for how they select companies,

[Interviewer]

the way they do cold calls, the

[Patrick O'Shaughnessy]

way they construct their portfolio. This is just a totally different way of approaching markets. They're trying to hit singles and doubles and deliver very consistent returns. Mitchell says it's really important in life to be memorable.

[Interviewer]

That's just a great simple thing that you can do. I think you'll find listening to Mitchell today and him talk about his entire

[Patrick O'Shaughnessy]

machine and the firm that he's built, that he himself is extremely memorable. And I hope you enjoy learning about his business.

[Interviewer]

So the first time that I heard about Lead Edge Capital was the very famous list of what companies report, starting with cash profits and then if they don't have cash profits. And you go down this very funny list hierarchy of bullshit and the bottom one is the place that's voted the best place to work in New York City or something.

[Mitchell Green]

Absolutely.

[Interviewer]

Where did that list come from? Why did you put that together?

[Mitchell Green]

We've always found that the best way to communicate with our audiences, which is entrepreneurs and also our LPs, our clients, effectively is to like write a quarter of the letter about a different topic. And I started my career cold calling companies and that's the way we source deals. But when you start your career talking to I think Brian and I probably spoke to like 10,000 companies and if you want to know it's a good company, just call 10,000. Call 10,000 of them. You'll figure out really quick. It's pretty good pattern recognition. Until our head of PR comms came in a few years ago, we had actually never posted any of these things online. We joked that we sent this letter to some people in the VC community, one of which is like our buddy at Andreessen Horowitz, and they posted it online for us. We just thought it's like a very simple Way in a world where people spout off total bullshit all the time and you see everything in Dex, this is just a good way to distill it.

[Interviewer]

Talk to me about the 10,000 calls. What did you learn calling that many companies?

[Mitchell Green]

You learn to be very disciplined actually. And you learn that most things are actually just noise. And to figure out what makes a Lead Edge company and then try to ignore everything else. You learn a lot about responsiveness of people and more responsive CEOs tend to be better CEOs I think another thing you learn that's really important for young people, if you tell an entrepreneur that you're going to actually do something, then actually do it. I think that's actually true of like your life. There are so many people that say they'll do things that just never do them. And so if you're known as a firm and a person that actually does what you say you're going to do, it goes a long way. So if you tell an entrepreneur, hey, I know somebody at Adobe, do you want an intro? Because it looks like we help for your business. And then he or she says, I'd love to. Well then guess what? Follow up with that. Do what you say you're going to do.

[Interviewer]

Can you describe what seems to me like I would call it a machine that is Lead Edge. Much more than most investment firms where a lot of great investors will tell you there's a lot of art, everything's different. Lead Edge feels to me like unbelievably well constructed as a machine to produce returns.

[Mitchell Green]

Yeah.

[Interviewer]

Before we go into all the component aspects of the machine, describe the machine itself at a high level. Before I get off on a tangent,

[Mitchell Green]

we run this place like it's a software company. My background was at Bessemer. I worked for somebody that was extremely disciplined that was building the cold client program. Partner Brian worked at Bessemer, we were the first two cocars. And my other partner Nimei worked at Insight. And I think Insight Jeff Arn was on recently is one of the best software investment or technology investment machines on the planet. So we've modeled ourselves on that to build a good investment firm that stands the test of time. If you want to go build the next TA Associates or General Atlantic or Bessemer or Sequoia, you just have to be extremely rigorous. And so our number one KPI that we run this place by is what is our gross dollar retention for LPs? We want 95% gross dollar retention because the only way you can get that is one have good Investment returns and great client services. So how do you, through long periods of time across people that will come and go, generate world class returns is you need to have a process. And the process for us starts with 18, 22 to 24 year olds that talk to about 9,000 companies a year. You get those 9,000 companies, how do you figure out which ones to work on? So then you need this framework to guide these 18 people to like, well it's going to be interesting company because in the investment business we have one asset, it's time and it's precious. And so how do you guide people to say no quick. And so we built this framework that we really took from coming out of Bessemer and so they helped build the Bessemer 5. We took the Bessemer 5, turned it into lead edge 8 and it's like drives. Everything we do now when we find the company, we're then super creative. We'll buy 10%, 80% LPs out of a 20 year old fund, buy employee secondary fund, somebody's CV. We don't care, we'll do anything.

[Interviewer]

If I think about the two sides being the LPs and the companies that you invest in, I'll come back to the eight criteria. The LP story that you have is also quite distinct and different. Can you describe that in a lot of detail?

[Mitchell Green]

Our LP base is all world class execs and entrepreneurs. Right now we do have some big institutions, but 95% of our capital is all these world class execs and entrepreneurs. And we use these LPs throughout the entire investment life cycle. It literally starts with sourcing. If a company won't call us back, we'll email our LPs 2 let's say it's like an automotive software company. We'll have Rick Wagner, the former CEO, gm, who's a long time investor. We will send them the CEO a note. If you're like an automotive software CEO and the former CEO at General Motors College, they're way more likely to take an email than my knucklehead emailing them or a 22 year old emailing them, then for diligence we'll say, hey, you're a healthcare software company, you're 25 million in revenue. Maybe you say like biotech or pharmaceutical software, it's like, oh, I see Pfizer's a customer. How big is it? 2 million bucks. Could be bigger. Oh, it could be 10 million. I'll meet the former CEO and then I'll call up Ian Reed and be like, hey, Ian, can you talk to this company? They'd love to talk to you. Can you tell us what you think? And then if it's super interesting, could you call Pfizer and back channel it? And then you might say to the entrepreneur, hey, I don't see Biogen as a customer. Would you want to meet the former CEO? So then you call up George, you're like, hey George, I found this company. It meets seven of our eight criteria. Then post investment, we literally send emails to our LPs, be like, hey, Toast is looking for intros to these restaurants. Do you know anybody? And it turns out all these people invest in funds and never get asked for help. That's how we do it and how we leverage them. But it's not actually why we did it. It would be a lot easier to go have 20 giant institutions, right? You have 50 to $300 million checks versus me spending a huge amount of my time running around the world, all the time spending time with these people. Because if you want 95% retention, that's what you need to do because they're your clients. The reason we did it is because I knew that the returns in this sector, in the tech investing sector flow to the top 10% of funds. They just do. It probably is the same in real estate, it probably the same in industrial buyouts. But like I knew in the venture world that had definitely flowed to that. And I had the pleasure of working for one of these firms, Best for Venture partners. So when I was starting Lead Edge, I was like, why in God's name is anybody going to take my money? I could teach them how to ski, but that isn't going to be very helpful. But I said, you know what? Had I been the global head of HR at Procter and Gamble and my partner had been the global head of HR at Microsoft and the other one been the head of HR at Nike. When I called the workday 80 times at Bessemer and Dave Duffield by the end was like, I'll hire you as a salesperson. I'm not taking your guys money. If I had been like a world class HR exec, he would have engaged with me because he would have known that I could have introduced you to those companies. Like I have tons of other HR execs. I know these people in a world that's super crowded and undifferentiated. And I think it's exponentially the case more today even than what it was 15 years ago. It just differentiates us. And we do what we say we're going to do.

[Interviewer]

How many LPs do you have?

[Mitchell Green]

Probably like 895% by number. Are these executives? Yeah.

[Interviewer]

If you think about the level of returns versus the consistency of returns, how much does one matter versus the other for this 95% gross retention?

[Mitchell Green]

I think consistency is more important on a per deal basis. We're trying to make a 2 to 5x in 3 to 7 years. That's like a 25 net IRR. If you just actually map it on a curve, put it into a fund. We want to generate 2 to 2 and a quarter X nets with 20 net IRRs. Some of those deals aren't going to be 5 X's. Some of them might be 0.7 Xs. Our downsides have been very low. I think we've only left all of our money in one deal ever. And that's because of the kind of criteria we look for in a company, what our average company looks like, and the fact that very few of our companies have any debt on them. Now I'm trying to make a 2 to 2 and a quarter x net, which is more like a 2.5x gross. However, if something is a really big investment in the fund, and we do not run funds with 100, 150 companies in them, we run funds with 20 investments in them. So if we've made something a 7, 10 12, 15% position and that goes 8, 10 12X, that's how you can 3X net a fund. Yeah.

[Interviewer]

And so because you really lose money, does that mean you also almost never hit some giant grand slam?

[Mitchell Green]

Correct. We're like Cal Ripkin doubles and triples. We're not Sammy Sosa like Mark McGuire. It's all about hitting doubles and triples. And if you do that with very little leverage in the portfolio, 90% of our companies or 85% of our companies are like recurring revenue. So if you invest today and know what revenues are in July, I think a pretty good way to invest 50, 60% of our companies are like profitable businesses. You may get it wrong, you may back the wrong team, you may overestimate the size of the market, But I think 70% of the time, we own the pref. Your downside's 1x. Now, sometimes you need to recut the deal with the entrepreneur or the management team so you're making slightly less than that. But if you can avoid zeros and turn those zeros into like 0.8Xs or 0.11Xs, it massively helps return it. We'll sell probably a third of our exits have been secondaries. We will buy secondaries. We will also sell. We constantly underwrite. We've been referred to as traders, hedge fund guys. And we're like, no, no, we' to actually make money because this company is about to be a living dead and you're going to be in this thing for the next decade.

[Interviewer]

Maybe spend a minute before we go through the buy criteria talking about selling more. What is the process that you run to be able to sell?

[Mitchell Green]

Well, we have a divestment company. There's three of us. Myself, Brian Eme, been here all since fund one. We have a disposition committee, same thing. We think a lot of firms do a really, really good job on the buy. Very, very few firms do a very good job on the sell, like knowing when to sell, pressuring to sell. And I would tell you that the private equity funds tend to do a much better job on the sell than most venture growth guys. Hedge funds. If you do invest public equities or only funds you constantly can buy and sell. The three of us meet once or twice a month and just walk through the portfolio and just talk about it like, hey, there's a round going down in this company. Should we sell? How can we try to position this company for a sale over the next 12 months? The fastest way to get fired at Lead Edge is have a company and not tell us when there's a liquidity opportunity or just something's about to happen before it happens.

[Interviewer]

What does the holding trade end up being on average then?

[Mitchell Green]

I bet our Average holds are three and a half to four years. Probably everybody gets all excited by these 2015-2016-2017-2018 returns. Our 15 and 18 returns look very good, but it's just multiple expansion. We sold, that's it. If you think you're going to make a 2x in four years and you make a 4x in two years, it's amazing what it does to net IRR. People forget the reverse happened in 20 and 21. Nobody's 20 and 21 funds. I think the venture growth ecosystem gets a bad rap, but it's going to be every alternative asset. Their 20 and 21 funds are going to be awful relative to earlier funds because people thought they were going to make a 4x in two years and are instead making a 1.6x in eight years. And so that's going to drive. That's going to have a huge impact on the industry.

[Interviewer]

What is the most interesting thing about the skill of selling and making the transaction happen? Like, presumably it's easiest to sell in private markets when a lot of other people are really excited about buying. You can't just hit sell, like in public markets.

[Mitchell Green]

Correct.

[Interviewer]

Maybe in, like, a bad medium. Good. There's different kinds of outcomes that you'd be selling into. Are most of your sales into everyone else is excited and you're less excited.

[Mitchell Green]

It can be everything in between. Like, if a company goes public, it's just hit a 2 to 5x in 3 to 7 years and then sell. So you're like, the company goes public, you're at like a 3.3x in 18 months or 24 months. You're like, that annihilates a 12% or 20% net RR. It's a great company, but we constantly are underwriting, like, what's a forward net return? From here, we made like, a 3X in 18 months. That's like an IPO in a secondary sale. It's about underwriting the forward IRR and toast, which is one of our biggest investments, which we put 12% of our Fund 3 into. And we'd always get crap. Our Fund 3 was like a $290 million fund, and we put 36 billion bucks into it. And before the IPO, we had sold 180 million bucks. I think we'd make 350 to 400 in it total. People are like, why are you selling? You don't believe in us? We're like, no, no. All these other knuckleheads that invested alongside us, none of them put 12% of their fund in it. And by the way, somebody is paying us a price in the secondary markets that we think is just lunacy. We sold in the secondary markets 40 or 50 bucks in toast. The stock today is 30 bucks. I think it's cheap, but it's just, by the way, we sold, like, six years ago. And so it's constantly underwriting forward irr.

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[Interviewer]

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[Patrick O'Shaughnessy]

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[Interviewer]

Okay, now I get to talk about the eight buying criteria. I don't know if you want to tick them off or give us some highlights or.

[Mitchell Green]

Okay, some highlights. So there's eight criteria. $10 million plus in revenue. Why do you have product market fit? Are you growing? Because we don't invest in startups. Are you growing like 25% a year? Returns to growth. We don't use leverage. Do you have 70% plus gross margins? Why? Because at the end of the day, you trade on multiples for earnings. Revenue multiples are just shorthand math for what it will be. EBITDA multiples or earnings multiples when you don't grow that fast. There's a reason that Facebook gives away electronics in the vending machines and Dell charges for Cokes. It's like one has 80% gross margins and one has 15% gross margins. And we think that just drives. At the end of the day earnings. Are you recurring? It's like a heck of a lot easier to invest knowing what revenues will be in July than they are today. Are you capital efficient? This metric has probably kept us out of the most trouble. It's like our version of return on equity. I think it's Warren Buffett would think radio. But are your revenues today greater than your historical cash burn? So what do I mean by that? There's 20 of revenue? Have you burned to 80 like every other tech company?

[Interviewer]

Cumulative.

[Mitchell Green]

Cumulatively, yeah. Have you burned 80 since inception or have you burned 10 since inception? We're looking for this one to one ratio. In a world where capital is a commodity and capital is everywhere. If you can build a business that's growing nicely while burning less than your revenues, you've got a pretty good business. We don't have startups. If you invest in startups or $2 million revenue companies, then obviously it's harder. Are you profitable at the bottom line? Do you have any customer concentration? I just don't want to wake up and find out 40% of my revenue is like disappeared because some customer decided they don't want to work with you.

[Interviewer]

I want to talk about the price you're willing to Pay for companies and how you would plot yourself on the so much of this sounds like a private equity strategy, but you mentioned toast and it's not like the high growth

[Mitchell Green]

rate toast was 25 million of revenue growing 150% a year. And it was. We paid like 500 million bucks. It was like 20 times revenue. People are like that's crazy. Not when it went from 10 to 25. So we just try to build a forward model. And you're like, look, you can pay as high a price as you want. You just got to be right on your exit. You got to be right on your multiple. How people got in a bunch of trouble in 2020 and 2021. I think how they're going to get in trouble today and all this AI stuff is they just assume the exit multiple is 20 to 25 times. That's insanity. Because when you're actually multiple collapses now so you can pay 20 or 25 times revenues. And if you're right like some of our companies have been, then it's fantastic. But you can also be wrong like some of our companies have been and you look like an idiot. I think investing in OpenAI 800 billion is a little insane personally. But I don't know if it goes on to do a trillion dollars of earnings. Yeah, I was going to be very wrong. I should have invested. It's almost like shorthand where if you're like if this company grows and doesn't desell much for 18 months, am I in the money and can I make a decent return for what I'm paying? And if the answer is oh, am I even in the money in 18 months or 24 months, yeah, you're paying way too out of price.

[Interviewer]

So right now there's this seismic thing. You can look at the Constellation and the Constellation software stock price or something as the perfect visual indicator of what's been going on, which is looks like a ski slope. This intense skepticism of the market, that boring traditional high gross margin software businesses are worth like much at all. But I'm curious how you process this moment where I'm sure a lot of the companies you're looking at are software companies that have a lot of the components that make people fearful of those similar kinds of companies in public markets.

[Mitchell Green]

Our belief for right or wrong is that the competitive advantage of software company has never been about R and D. We're not building semiconductor chips, we're not building biotech in pharma companies. This isn't that it's to build like chamber of commerce software you too could build this. My mother couldn't, but my brother could. No problem. He's an engineer who could Microsoft. Any of our companies in our portfolio. If Microsoft took 500 people and gave them a month each one of our companies could be out of business. But they just don't care about the chamber of commerce market. They don't care about the price optimization market for manufacturing companies. They don't care about the tax software market for a very specific niche product. So the software companies are really about like distribution, sales and marketing, customer success, client services. We believe that it is the incumbent's game to lose in software today. I'll give you a couple examples. Workday has 98 or 99% gross dollar retention. It grows 10, 15% a year. Only goes 10% a year. I'm sorry, it's like 10 billion of revenue. It only took 20 years to get there and it does 3 billion of free cash flow. Exxon or the hospital system or War Ru Pincus or KKR or Procter and Gamble probably spent three to five years implementing the software. If you think they're going to start building their own HR software, you're on your mind now. The GUI in how you access it is going to be far different. But actually they already have the customer relationships. And the only reason they built it is because Dave Duffield And Neil realized 20 years ago that Oracle and SAP had really crappy products. They have thousands of engineers that are trying to build the product much better and are going to use Workday versus Mitchell Green's cousin Vibe coding his way to build Workday. The flip side, why did Koopa get built? And the reason that it was able to be built is SAP bought Ariba and they just left it for debt. So they built this big business, they took it public and now it's been sold to Thoma Bravo. So what I actually worry about Thoma Bravo or any of these big private equity funds if they're putting a bunch of debt on it, it's not growing that fast anymore. If they're putting a bunch of debt on it and then what they do is they're like oh yeah, we drive all our companies to rule of 50 businesses now do they end up cutting a bunch of people in R and D and sales and marketing and product that if you were being run by an entrepreneur with no leverage, you would have kept and is now I worry that a bunch of these private equity owned assets that are over levered are ripe for disruption versus independent software companies that are focused on growth, that are Trying to innovate. And I like to remind people that if you look at e Commerce in 99 and 2000, everybody thought every big box retailer was going out of business. But if you look at the top 50 largest E commerce companies in the United States, Amazon is number one. Two through ten are Walmart, Home Depot, Lowe's, Macy's, Target. I mean, Saks is a crappy company. Their online business is actually pretty good. Neiman Marcus, same thing. A lot of the incumbents will win now again. Montgomery Ward, Kmart, Sears, Wet boss for either overlevered, didn't innovate. So for us, that's what we're constantly thinking about.

[Interviewer]

Does that mean that right now feels like an especially opportune time for your style because entry multiples are lower?

[Mitchell Green]

I think the best risk suggested returns right now are in public software names. By the way, Warren Buffett says buy when everybody is fearful in the streets and sell when everybody's super excited. People hate software. When we bought a bunch of our ByteDance stock two years ago when everybody hated China. When Alibaba has doubled off its lows and doesn't grow and trades at 15 times earnings.

[Interviewer]

If you think about the CV, very specialist type buys that you'll do. Can you explain an example of one of those?

[Mitchell Green]

We like to use the house analogy. You walk down the street, go into an apartment building. My apartment needs to have these six things. You can go in the front door and you can lead the primary round and put money on the balance sheet. Or you can buy the whole business. You can go in the side door and buy an early investor or early employee out, but maybe that's not available. So we'll go through the basement window with a pickaxe and buy a derivative. Because if you run a business and this can of Pepsi owns 30% of your business, and I go to the glass, that is an investor in the can of Pepsi's fund and that is nearly half the LPs. And I literally buy that out. And you own 30% and I buy half the fund. I just bought 15% of your company. It's the same damn thing. It's just a derivative. Do you have as much control? No. Do you have as much insight? No. But you trade off price for access. We made a big investment in Zoom, so we couldn't go into the front door. The company didn't money. We sure as heck weren't buying the entire business. You couldn't buy secondary. There was secondary to buy. You couldn't buy it because Sequoia would roll for you. They're smart, they're not dumb. They're like, why would we let these knuckleheads in? We'll take the stock and make two to three times our money. And the company was one that took a long time to get funded and wasn't backed by Sequoia they wanted. It was backed by a bunch of random Chinese people and Chinese funds. It was actually second year buy, but you couldn't because they're over. So we're like, huh, why don't we go to this fund that has stock? Their LPs have been in this thing for 10 years. Maybe their LPs want to sell. And we can do it one of two ways. We'll just buy your position in the fund and we'll know exactly how much. We'll know exactly how much Zoom we have to do it. Or why don't you just create, like a new vehicle? Any LP that wants to sell will step into their shoes. Well, if you own 2% of Zoom and half the LPs want to sell, and I then step in those shoes, I now own 1% of Zoom. And if I say to you, listen, we get to vote them like we own them, but you still hold it, the company gets an M and A offer and you get to vote. You have to call us. Day 181 of the IPO after lockup. You got to give us the stock. We. We just bought the position. In a world where LPs and GPs are desperate for liquidity, that part of our business is absolutely booming. And that part of our business is headed by Tim Beamer, who's one of my partners, who was actually a Notre Dame alum as well.

[Interviewer]

If I think about the dollars deployed last year, over the next year, how much of it is direct capital on the balance sheet? Secondaries, Something creative, like what you just said?

[Mitchell Green]

70% creative on the balance sheet. 70% is special sets or like secondary. We will evaluate in an ic, a public position, a control buyout, a minority deal, or a special sip. You could hit four different things in one week. And literally we underwrite the same return. But today the opportunity is in. We are a market drawdown away from it exploding in value or like exploding in stuff to do.

[Interviewer]

The hard part, it seems like, is finding a company that has six of the eight criteria that you can also buy at a multiple that you're excited about for the forward return. What percent of companies of the 9,000 or whatever meet all eight criteria, by

[Mitchell Green]

the way, no correlation how it performs either. If we do like an eight criteria deal versus like a five criteria deal. There's like actually no correlation to like it was a better deal.

[Interviewer]

What about like four or three we've never looked at?

[Mitchell Green]

Because we, what we try to do is if you say it must meet eight criteria, 9,000 companies becomes 90 to do five to seven deals a year. It just doesn't work. And so for us, what we say is it just like must meet five. That's about a 10% yield. We're trying to get to a set of companies that we can then actually do work on. So you have 900 companies that meet five or more criteria. You do diligence on about 150 to 175 to do five to seven deals a year. And you're like, well, why not more? I'd love to, but like we're cold calling entrepreneurs. They're like, oh, I'm sorry, I want to sell my business tomorrow. You just happened to call me on this day? No, the sales cycles can be a decade. And it's about staying in touch as entrepreneur because we're not the only ones calling them. There's great firms like Summit or TA or Insight or, you know, Bessemer or Battery and the great firms. And so it's like, well, ask the entrepreneur how do they need help? Try to tease information out of them. Oh, you so into like the consumer space. You want to meet the former CEO Kolya Pamolov and you're doing that to try to build a relationship with somebody.

[Interviewer]

If five criteria companies don't outperform eight criteria companies, doesn't that imply the criteria aren't predictive? So then why have the criteria?

[Mitchell Green]

Because you need to set a framework for what to focus on and what not to focus on.

[Interviewer]

So they're not predictive necessarily.

[Mitchell Green]

It's not predictive, but it's getting us to a small enough pool. It's like knowing your strike zone. My partner is a big baseball fan, uses a baseball analogy. Like Ted Williams knew in the hitting zone exactly where to swing and what his probability is for it. Swinging the ball like, yes, you can hit a ball two inches above home plate and it could be a grand slam and have hit the ball the far as you've ever hit it. But if you do that over an entire career, your entire career won't be very long. And so it just enables us to know what pitches to swing at. Our biggest mistakes have honestly been not swinging at the pitches when they were in our strike zone. And I think that's what we've learned over the last 15 years to get more comfortable. And when it's in our strike zone, swing at it.

[Interviewer]

How do you train these young people to be able to get all this information, to know whether or not it's an eight point score or whatever out of an entrepreneur? What is the art of getting someone on the phone and then actually getting them to tell you the information that you need?

[Mitchell Green]

It is incredible what people will tell you on the phone. People are like, listen. You just call people and they talk. People love to talk. It's investigative journalism. With sales, we tend to hire people that are former athletes. But getting a C or a D on a test is not your biggest failure. Dropping the ball at the Rose bowl or not making the Olympic team, that's failure. And so you're looking for people that are insanely persistent, people that are really inquisitive. And then it's just, hey, Patrick, pretend you're toast. We're doing work on the restaurant point of sale system space. I read a bunch of articles that sounds like you're kicking butt. Oh, by the way, I just talked to like Square and Clover and we'd love to talk to you on the phone. And oh, by the way, I'm sure you're getting bombarded by other people, but we're different than a lot of firms. A lot of our capital comes from world class execs. Oh, by the way, one of our LPs, the former CEO Wendy's. We'd be happy to talk to them if you don't meet these people. Huh? Sure. Love to chat. By the way, we used to get to cold call people when Brian and I and E. May were doing this. Literally cold call people. And you'd be like, you feel like the person who calls you at 6pm 20 years ago that you like slam the phone down on. Today it's like you guys get to send emails to people. Give me a break. We actually try to now encourage some of the analysts to start calling people. The biggest issue is it's hard to get people's cell phone numbers versus work phones. And it's just once you get the person on the phone, you just have to show knowledge. That's where, by the way, AI is incredible. It's like you give every analyst an associate, you give them the power of knowledge and you can sound super smart and you won't get everything. It's like, hey, I saw on LinkedIn you have like 80 employees. So what do you like, 10 million revenue? 15 million revenue. Oh, I see, like your employee trust growing like 80% a year. What are you growing, like 150%? Not that fast or what? Like 100%? Yeah, around there. So it's trying to get numbers.

[Interviewer]

If you think about this machine. So we've got this very unique LP base. We do 9,000 calls, five to seven investments per year.

[Mitchell Green]

We just raised our seventh fund. It was three and a half billion.

[Interviewer]

Okay, so three and a half billion dollar fund, two to two and a half percent net moics to your investors. So that's the machine. Where do you feel the most tempted to go? Tinker on the machine for the next decade? How do you hope the machine improves

[Mitchell Green]

as the firm gets bigger? How do you build a culture of teaching people to still be creative scrappy hustlers? But it's the most important thing. How do we get creative and do CVs? We were doing CVs and nobody wanted to do CVs. We didn't know they were called CVs. We just thought it was paying somebody a profit share. It's continuing to innovate on that. What's really interesting is the secondary markets now for some of these names are so liquid. So actually you almost don't even have to underwrite to this thing going public. It's like, can it just get big enough with enough escape velocity where I can then sell out?

[Interviewer]

If you think about all the investments you've made in the last five years or something, how often are you personally excited about the company and its product?

[Mitchell Green]

Frankly, this is what drives me nuts about a lot of people in the venture capital ecosystem is they think they're actually changing the world, which they are, but they should tell everybody about it and they're like doing God's greatest gift to mankind. Like, we don't think that. We love helping entrepreneurs. Like that is actually what gets me excited and gets us up in the morning. Helping an entrepreneur try to bend the curve and make that customer intro and help find that great cfo, the audit chair or whatever. We love making customer intros. That's what gets us the most excited. And I think we are still actually just scratching the surface on how we can leverage our LPs.

[Interviewer]

How often do you control the business?

[Mitchell Green]

We are in a control position about a third of the time.

[Interviewer]

When that's the case, how different is that?

[Mitchell Green]

It hopefully should be no different at all. But there's less knuckleheads around the table, there's less people around the table. And what's really interesting is when you have a lot of different people around the table. You can have a lot of different competing interests. And so it's about building consensus. And you have people that are in one cost. That's why there's all these 20 and 20 21s. Companies haven't sold them. There's these late stage guys that are like, oh, just get me out. I own the profit. I'll make a 1x today or I'll make a 1x in a decade. But we don't go into companies and say we're replacing the entire management. This is not what we do. When we invest in a business and when we exit, it's something like 75% of the time. The person who was running the business when we invest is still involved in the company. It may not be running it, but it's like back people who just want to build awesome businesses and great companies. And it's like, listen, if I'm not the right CEO, well then make me the Chairman of the board or make me the chief customer officer or make me the chief Product officer or whatever. That's what's really important.

[Interviewer]

I want to go back to the culture thing, the lead edge culture. I mean, what have you learned about culture in the many years now that you've been doing this? Especially given this is the thing that you want to keep nurturing.

[Mitchell Green]

I didn't think I appreciated how much culture comes from the top. Follow ups send handwritten thank you notes. I've sent handwritten thank you notes. Everybody I meet, almost everybody, every entrepreneur, every company, guess who also does now? The 22 year old analyst. And by the way, we track it and report on it, if you just treat people the way you want to be treated, that just flows. We've built a culture of treat LPs like you yourself want to be treated. People appreciate that and it comes from the top. The intellectual honesty comes from my partner Nime. A lot of the creativity comes from my partner Brian. Now of course, as you get to be 85, 90 people at a firm, we've built like a real training program which is a result of a lot of work. Nime and Brian and our COO Susie's done. And that team and the recruiting team, we didn't have weekly IC meetings before three or four years ago. Why? Because the IC was the three of us. We talk every day and so it's just like building processes in place.

[Interviewer]

Can you talk about this crazy one on one thing you do with every employee?

[Mitchell Green]

I got the idea from Tom Barnes at Excel, kkr. He's built a true machine at Excel, kkr. I asked him, what do you think? Something you do that really helps the firm. He's like, interview everybody once a year. So we start with a survey and then you sit down with every employee you personally do. I personally do sit down with every other partner, every vp, every associate, the accounting person on the back end, every receptionist, and be like, what do you like about your job? First, give me everything you do. Green, red, yellow. Green you love, red you hate. Let's figure out what you hate and why. And if there's things you hate, well, then let's figure out other people that may be able to do them. Or how can we make your job easier? Okay, that's the first bucket. Second bucket. If you were me running Lead edge, what would you change? Three, what's something we can do to make your job easier? What you learn is incredible. You get a bunch of really good ideas every year. It actually drives my two partners nuts. Because sometimes I'm like, that's amazing. Do it. And then they're like, come on, we need to have build consensus. I'm like, no, we don't need to build consensus on some of these things.

[Interviewer]

Is there anything else that you do in the culture that you feel carries that much freight?

[Mitchell Green]

Being a good person is not that hard. Frankly, in a world that's insanely competitive, if being the nice guy gets you the callback and being the helpful person, then do it all day long. And then it's another really important thing about running this place is I can't be the bottle. I can't know every LP. And so if you're a 25 year old or 23 year old associate here and you have to go to Seattle next weekend for a wedding, I'll pay your trip if you stay on Monday and go meet a bunch of LPs. But you're 23 years old, 99% of friends on this planet wouldn't put 23 year olds in front of LPs. I'm like, if you're smart enough to work here, you're smart enough to meet this LP. I don't care. And people love that. The 23 year old associates love it, which helps us get great people. But then also the LP loves it too, because they'll be like, oh, my son is your age, would you mind talking to him? Or hey, you went to Notre Dame? Oh, my son plays lacrosse. It's like thinking of going there. Would you talk to him and be like, oh, well, actually no, talk to my partner, Tim, because he played Notre Dame lacrosse. You just build real relationships with people.

[Interviewer]

If you think about the average month for you, and the major slices of the pie are time with LPs, time with companies. I'm so curious. It's actually kind of hard to guess. Maybe there's different buckets than those three LPs, companies, investments, internal. What does yours look like?

[Mitchell Green]

And mine's by the way, very different than Brian and emis. This is by design. It ebbs and flows a little bit with fundraising, obviously. I probably spend 60% of my time with LPs.

[Interviewer]

Wow.

[Mitchell Green]

Now again, that could be getting somebody to help a company though too, or coordinating with the team of people with us, like, hey, let's figure out a way to get into Exxon. And then I would say 25, 30% of my time is investing related, which could be reading memos, helping people win deals. That's frankly how I want to help. I'm like, if we lose a deal because I didn't meet the company, I'm not saying I can help us win, but we got to at least put our best stretch foot forward. And then probably 15, 20% is operational. The operation stuff's come down because one of our partners, Susie, who lives in Greenwich, used to be an investment partner. A few years ago she became our COO. So that's like my time. Nime probably spends 90% of his time investing, 10% of his time on everything else, which is what he should do. I think Ronnie and the IC, our partner Brian, probably spends 60% of his time investing and probably 2020 on LPs and operations. It's very clear to people that spend time with Brian, Eme and I that we like, play to our strengths and weaknesses.

[Interviewer]

You mentioned Tom Barnes as someone that you've learned from. If you had to create a Rushmore of other investment machines that you most respect. Who is the Rushmore?

[Mitchell Green]

Insight, TA and probably Excel, kkr, I think Devin, Jeff Triplet, the guy Lieberman at Insight have just built like a factory. You know how you know what a good software company is? First talk to 30,000 companies a year. It's an absolute factory. It's a process. And so I think they're like amazing at it. TA is the one that pioneered cold calling. Insights obviously stayed to itself. I would guess Insights growth rate in their portfolio between 2001 and today is actually pretty similar. TA's has definitely come down. They're more private equity, like discipline in process. I get the sense that TA is very good at selling too. And then xlkr has built like an incredible Value creation team that I think actually adds a lot of value. I think there's a lot of people that talk about value creation. I don't do much, but I get the sense that these guys are just like very good at actually helping companies and trying to bend the needle.

[Interviewer]

What have we missed about what makes the machine tick that you think is really important?

[Mitchell Green]

I would have said that the three of us who run the machine are all very, very different. And we play to our strengths and I don't think that should be underestimated. And I think that's what makes the machine. We literally negotiate carry economics for the three of us in 10 minutes. There's firms you hear about that get into month long fights over carry. We all highly respect each other and know what we're each really good at. Just a focus on intellectual honesty that I think a lot of firms just don't have. If you go to our investment committee, our investment committee is the three of us. Everybody that's basically VP enough gets to come. But if you sit in the room and listen to Brian and IMEI talk about a deal, you would think the three of us hate each other. Or you might think we're Israeli because it was just like a joke in Silicon Valley. If you listen to like Israeli board meeting for the outside, you're like, these people hate each other. Like how? They're like, no, no. That's how they talk. So it's like, no, it's just like, let's debate the merits of this deal.

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[Interviewer]

We riff a little bit more on just all the ways that you're excited and fearful about AI, both in the investment process at Lead Edge, for running Lead Edge the business and for the companies that you invest in.

[Mitchell Green]

I'm the most fearful for what I don't know. AI is going to change the world and it's going to do it in ways that nobody can think about, just like the Internet did. And in 2099, 2000, we got sat here. We wouldn't have mentioned social media. Today it's $3 trillion of value. Now I'm the most fearful whether it comes to companies and processes for that. It's like, what don't we know? What are we missing? What am I the most excited about? For us, AI in the long term will create the biggest productivity game over the last 7,500 years. Don't know if it'll be like electricity, but it'll be pretty damn close. That's really exciting. But people get too excited about, oh, we're going to go build the next piece of workday or we're going to go build better call center software. You're going to see industries that we're not even thinking about. Even thinking about what's going to be possible is going to happen. That's really exciting. It's going to be the age of entrepreneurism. People are going to be able to build awesome businesses. What I worry about, whether it's internally at Lead Edge or at our portfolio companies, is do we have the right people in place so that we don't get disrupted? Because you constantly want to be, I joke, you want to hire a bunch of young people. The people worried about the young people aren't going to be able to find jobs. It's like really young people are the ones that have to figure out AI more than the 60 year old or 55 year old. And so we actually rank, we take all of our portfolio companies and we're saying, what's your AI readiness score? And then it's okay, this company's like really high. This company's pretty low, huh? We should connect those entrepreneurs together to figure out what they're doing.

[Interviewer]

What goes into that score?

[Mitchell Green]

What's your data look like? Is it structured in a way that you're going to be able to leverage AI? Are you iterating? How many AI products have you come out with? What's your AI revenues on new products? How much more product releases are you able to release? It's not, did your engineering comp stay flat or go down I for one strongly believe that if you think in 2020, if your budget in 2024 for 2026 was to have 150 software engineers, you should still have 150 software engineers because those software engineers can be exponentially more productive and they can then create more products that your sales team can then go sell.

[Interviewer]

Who do you compete with?

[Mitchell Green]

We would bid against Insight, ftv, jmi, Battery, Bessemers where they do like bootstrap ish type stuff. Sometimes we compete against Maritech and IVP and Rocketship companies in Silicon Valley are freaking awesome. Ivy's not gonna pay 100 times revenues for them. That's the problem right now. There's like too much money. Matt Kohler said it best. It's like they back these giant Internet companies when distribution was loose and capital was tight. It's like the reverse happened. So capital is everywhere. But like four companies control distribution. So good luck going to build a giant Internet company. And right now there's just too much money chasing, at least in Silicon Valley, two great things.

[Interviewer]

So decompose and expand on that a little bit. So I guess the question is your view on the state of markets and technology markets in general.

[Mitchell Green]

Overhyped, over frothed. And I believe this AI capex bubble will end badly. It's like the telecom bubble all over again. It will be very interesting if Apple may look like the really smart one at all. At the end of the day, we've seen them, but I think people are just going to overspend. I'm convinced that people invest in all these AI companies, all these VCs have to portray the view that software is going to be dead because they have to justify how much money they're going to spend. If you start to run these assumptions on how much money is going into these companies and what that means for how much earnings you have to drive and what that means for how much power you need to generate. It just doesn't work. Where are the nuclear power plants coming up? And it just doesn't work. That presents the opportunity. That's when you're going to buy it. That's when you're going to buy these companies.

[Interviewer]

The counterargument would be in telecom it was all dark fiber. In AI it's all burning GPUs. And yes, the capex is crazy, but everything still feels mega, undersupplied. I'm just curious how you think about when the opportunities will present itself for an investor.

[Mitchell Green]

My fundamental belief is that the models will commoditize and that companies Like Google and Facebook and Amazon and Apple have a competitive cost advantage. Companies like Amazon and Microsoft and Google have more data to train a model than these new model companies will ever have. And then, oh, by the way, if you wear all these Chinese models or European models, a bunch of these things cost a fraction of the cost to run. And you can run them locally, especially in companies outside of the US why would you pay that amount for OpenAI tokens or Fantomic tokens when you can just run Deepseek or one of these other 10 models? I think we worry the most about volatilization. I have no clue when this will stop. It will probably go longer than people think. In 99 and 2000 people also thought we were in a bubble. People think we're in a bubble now and it will just stop. Is it one of these monster IPOs happening and it just doesn't go like people think it does? I think the anthropic wrong was kind of like an ipo. We're trying to hit doubles and triples. A lot of these companies we struggle with, they're either going to be 200xs or 100xs or zeros. That's a struggle for us.

[Interviewer]

What kind of company in the AI center of the heat map. I know you're probably not investing in any of them because the multiples or whatever. What kinds of companies are the most interesting to you? Just as an enthusiast, I think it's fascinating.

[Mitchell Green]

Some of the stuff that's being done in infrastructure, software and actually agents appear to consume more resources than actually people. Some of these consumption based models, the growth of companies by dumb luck. We were very early investors in Clickhouse, which is a database company. We were early investors in Grafana Labs, an infrastructure company that competes with Datadoc. I think Datadocs were in the high 20s, 30% a year at scale. It's those types of companies I think we find super interesting. I find them fascinating. I really struggle with the valuations, but the growth rates are like we've never seen with very good economics. You see how much money a company like Clickhouse has raised. What they've burned is very little compared to what you might otherwise think.

[Interviewer]

What do you think is the most surprising thing about you? You have a good sense of you, how you operate. Persistence, enthusiasm, energy, process. What do you think If I spent 10 hours with you, I would be most surprised about probably how driven I

[Mitchell Green]

am and how much I truly love what I do. And I just put my heart and soul into everything I do, whether it's racing cars, which I race cars competitively. I was a national ranked ski racer or how I run the edge. I probably sleep five hours a night, four hours a night. It's because I love what I do. I'm insanely competitive. If you spent 10 hours at B, you'd be like, oh my God, this guy is the most persistent, competitive person I've ever met.

[Interviewer]

Were you born that way?

[Mitchell Green]

Yeah, I think I was born that way.

[Interviewer]

Was it enhanced through formative early experience?

[Mitchell Green]

Ski racing, skiing, growing up as a kid? 100%.

[Interviewer]

Can you make that tangible for us? What was it like?

[Mitchell Green]

Process. Do these things and you'll get better. Do these things on video in a GS course and constantly analyze video and do these things the next run and change this and you fell, get up and go do it 10 more times. I grew up on a ski hill that's 500ft. I mean, Lindsey Vaughn, one of the best skiers in the world, she grew up skiing on 500ft Buck Hill in Minnesota, doing laps from 4pm to 10pm at night. Just repetitive. Mikaela Shifrin, who's one of the best female skiers in the world, views it as her time on snow is like limited. When you get off the chairlift, everything is a drill. Constantly be trying to improve. I think that's it. At LEED Edge, what you would find in me is constantly trying to improve. What surprised me the most, actually, if you had to say, like, huh, you started the firm 15, 20 years ago. I think I've been able to recruit and maintain, motivate and build a really good team. I mean, very good to pick really good partners that treat other people really well and that feeds on itself.

[Interviewer]

Is there anything else from skiing? I'm not a skier that you find visceral and helpful as an analogy for how to do things elsewhere other than reps and practice.

[Mitchell Green]

Scott Booth, who ran Eastern, I asked him why he hired me and this was early 08. He said to me, because when things get scary, you're going to want to buy. And I didn't know what he meant because he's like, you get on the hill at 80 miles an hour. This isn't scary. This is like nothing. You're like, you can make a decision of going down the hill at 80 miles an hour and what to do and what not to do and not to fall. Then the fall of 08 happened. Look, this isn't scary. Let's buy. It's eventually going to go up. Ski racing helped me really understand a very Fine line and risk adjusted and risk return behavior. I just think being an athlete, whether you play basketball, whether you play hockey, whether you play golf, I think athletes just have a work ethic. If you're trying to find it in young people and have a drive, there are athletes that have incredible athleticism, but also have incredible work ethic, like Michael Jordan. Those are the best of the best. Then you have people like Steve Kerr who are not very good athletically, but had a work ethic of Michael Jordan. They could be good, but then you have wasted talent, which is like Dennis Robbins of the world, where they were amazing athletes, but they didn't have a drive. And I think the same can apply to investing.

[Interviewer]

Why did you choose to start the firm? Because you were quite young when you did it. How could you translate that experience into advice for someone listening, that is thinking about starting a fund to decide whether or not they should do it?

[Mitchell Green]

Just go do it. Do you want to be an entrepreneur? My partner, Brian's like, the reason you started a firm is because nobody was going to hire your ass and because, you know, you couldn't work for anybody. I've always wanted to be an entrepreneur. I wanted to make a lot of money and be really, really successful. It's always true for me. I always wanted to be solely focused on it. And if you want to generate generational wealth or build something, you need to be an entrepreneur. Yes. If we build Blackstone, everybody who's here will make an insane amount of money because it was 90 people. One of my partners, Zach, is very young. I mean, he's 30 years old and he's a partner because he joined here and he took a bet when the farm was tiny. I just encourage people, if you want to do it your own way, there's no better time than now. What are you waiting for? I actually think it's easier to leave when you're 27, 25, than when you're 45 and have three kids. I had nothing to lose if it failed. I was going to just go work eventually, I guess work for somebody.

[Interviewer]

Once you made lots of money, do you still care?

[Mitchell Green]

100%. Why keep score every day?

[Interviewer]

Because it's score.

[Mitchell Green]

It's a score because I want to win. People like Ken Griffin and Steve Cohen are mentors to LPs of ours. It's incredible how hard those people work. Now, again, Maybe these are NF2 people. Or if you look at some of these tech entrepreneurs, like an Elon Musk or Alex Karp from Palantir or Matt Prince. From clubflare or George Kurtz from Crud Strike. These people are incredibly driven, hardworking people that live and breathe what they do. And so yeah, I mean, people keep score. It's not work for me. This is fun. I travel constantly to meet companies, to meet LPs, to meet entrepreneurs, to meet bankers. And it's not work. It's fun. Tell people my schedule and they cry. I'm like, oh, that's not work. It's fun.

[Interviewer]

It's pretty amazing what you built a very unique model. Incredibly fun. Willing you are to just walk us through it all. I had so much fun doing this. When I do these interviews, I ask everyone the same closing question. What's the kindest thing that anyone's ever done for you?

[Mitchell Green]

Pete Wilmot, he's passed away, was the former CEO of FedEx and he was a Williams alum. I started a company in college and he was the first person that ever believed in me. I was like 19 years old and he became an investor with us and the company completely failed when I was trying to get my first job. And when he got my job at Bessemer, he was my reference and he basically told the person they were insane if they didn't hire me because I was the most persistent person never met. So that's probably the kindest thing I've always ever done.

[Interviewer]

I learned so much today about building something unique.

[Patrick O'Shaughnessy]

Thanks so much for your time.

[Mitchell Green]

Thanks so much.

[Patrick O'Shaughnessy]

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