Podcast Summary

Podcast: Liftoff with Keith Newman
Episode: VC Secrets: 25-Year Partner Reveals Startup Truth
Guest: David Hornick (Partner, formerly August Capital, now Lobby Capital)
Host: Keith Newman
Date: August 22, 2025

Overview

In this candid and wide-ranging conversation, host Keith Newman interviews veteran venture capitalist David Hornick on his 25-year journey in Silicon Valley. Hornick shares insights into the venture world’s evolution, what makes great founders, how to stand out when seeking funding, the impact of AI on tech investing, and hard-earned advice for startup operators. Throughout, Hornick’s blend of humility, humor, and candor offers rare, actionable wisdom for entrepreneurs at all levels.

1. David Hornick’s VC Journey: August Capital to Lobby Capital

Timestamps: 01:46 – 07:34

• Background: Hornick began his career as a lawyer, finding his way to Silicon Valley just as the internet was exploding. He quickly became captivated by startups and ultimately joined August Capital after a serendipitous boardroom meeting.
  • “I was addicted. Like, the second I started working with startups, I was addicted. I thought, this is…extraordinary.” (02:17, Hornick)
• Move to VC: Recruited by August Capital’s founder, Dave Marquardt, Hornick learned the ropes and eventually co-managed the firm.
• Transition: When August considered raising their 8th fund, Hornick and his partner decided to start “the firm we’d want to build from scratch”—thus, Lobby Capital was born, an outgrowth of a community-focused founder/investor event called The Lobby.
  • “We said, let’s call it Lobby Capital. Let’s raise a small fund where we’re deeply involved…and just go help build great companies.” (07:17, Hornick)

2. Changing Landscape of Venture Capital

Timestamps: 08:00 – 10:09

• Then vs. Now: VC used to be a “small industry” centered on Sand Hill Road, with few funds and collaborative dealmaking. Now, there are thousands of early and late-stage funds; competition has intensified, and capital is abundant.
  • “The amount of capital is just disproportionately large…It’s quite competitive now. It used to be a little, little industry.” (09:04, Hornick)
• Implications for Founders: More options for funding, but harder to discern quality investors. Hornick emphasizes his “relationship investor” approach as a differentiator.

3. The Hornick Approach: People, Relationships & Reputation

Timestamps: 10:09 – 15:44

• Relationship Focus: Hornick sees his role as that of “confidant, coach, friend, and advisor”—favoring people over technology or markets alone.
  • “I’m a people person… I want to be someone you can lean on to get good advice… be a shoulder to cry on… Someone who will celebrate with you.” (10:27, Hornick)
• Reputation and Due Diligence: When competing for hot deals, Hornick urges founders to speak with any entrepreneur he’s backed, both successes and failures:
  • “Here’s a list of every entrepreneur I have ever backed. Call any one of them. I’m not cherry picking…do the work to talk to them.” (11:48, Hornick)
• What He Looks For: Intellectual curiosity, adaptability, and a belief in their mission are key, along with the ability to sell and inspire.
  • “I’m looking for people who truly believe that what they’re building is important, that they’re listening…and engaging in ‘how can I be the best version of myself?’” (13:34, Hornick)

4. The Startup-Funding Process: What Gets Hornick’s Attention

Timestamps: 14:27 – 17:10

• Deal Selection: Hornick sees thousands of pitches yearly and funds just one or two. Large market size and big problems attract him.
  • “It’s very hard to build a giant business on a tiny market. I’m looking for people solving big problems.” (14:51, Hornick)
• Case Study (Splunk): Pointer to the importance of obvious customer pain and founder ability:
  • “[Splunk founders asked,] Wouldn’t it be great if there was a search engine for log files? … Every single person said, if that existed today, I would buy it.” (15:45, Hornick)
• Speed of VC Deals: A warning against rushing into deals for both VCs and founders.
  • “You should take the time to get to know the people who are going to work with you… I’ve worked together with the founder of Bill.com for almost 25 years.” (16:33, Hornick)

5. Mega Trends: The AI Wave and Market Dynamics

Timestamps: 17:22 – 24:39

• AI vs Internet: Hornick sees AI as a “very different wave” than the internet, primarily because today’s giants (OpenAI, Microsoft, Google, etc.) may dominate many verticals, potentially stifling startup opportunities.
  • “There was no behemoth that owned the internet… we are at risk…of this AI wave being a handful of behemoths that really control all the value.” (18:01, Hornick)
• Big Tech as Frenemy: VCs now worry that even successful startups can be crushed if a mega-player (Amazon, Google, Microsoft) decides to enter their space.
  • “Every time [Amazon] has a Reinvent conference, they announce a set of features that kill hundreds of startups…That’s a huge problem.” (20:51, Hornick)
• Defensibility: Unique data sources are one of the few reliable AI moats.
  • “If you have a unique data source…your AI platform is better informed than the competition…you’ll be able to create something interesting.” (24:17, Hornick)

6. Social Impact, Ethics & Responsible VC

Timestamps: 24:39 – 26:00

• Weighing Impact: Hornick stresses the need to consider ethics, employee welfare, and community impact. He notes his own children’s skepticism about AI’s environmental footprint.
  • “Every technology wave…both [creates]… life-changing opportunity, but also [can be] a net positive for the planet. I will continue to look for those.” (24:59, Hornick)

7. Raw Truths for Founders: What Founders Don’t Know (But Need To)

Timestamps: 26:25 – 30:14

• Unexpected Challenges: First-timers are unprepared for the endless, unpredictable problems. Even repeat founders face novel issues.
  • “Unless you’ve done it before, you kind of have no idea what’s coming…the number of problems you have to solve in any given day is infinite.” (26:54, Hornick)
• Resilience Through Crisis: Anecdotes from real-world crises (bank failures, personnel challenges) exemplify the need for resourcefulness and support.
  • “I will give you a personal loan before I let you do that thing because it’s bad for your company.” (28:59, Hornick, recounting a payroll crisis during the SVB collapse)

8. Customer Focus & the Value of Listening

Timestamps: 30:14 – 31:46

• Customer Engagement: Too many tech founders don’t talk to customers early or often enough. Hornick teaches “Startup Garage” at Stanford, where he drills this lesson.
  • “Half of what we do is just say, can you please call more customers?... The buyer is king. You must know who you’re selling this thing to and what will create value for them. And if you’re doing anything else, it’s not a good use of your time.” (30:49, Hornick)

9. People Skills and Team Dynamics: Human Nature Drives Success

Timestamps: 31:46 – 33:42

• Understanding People: Success in startups is impossible without grasping motivation, ego, and human nature.
  • “It is very hard to be successful if you don’t understand human nature… People want—what is it? What is it that’s motivating them?... People underestimate the importance of understanding human nature and…how that will play a role in sales and marketing and team building…” (31:46, Hornick)
• Team Pitfalls: Hornick shares a story about a CEO making avoidable talent mistakes due to ignoring human nature.

10. No-Tolerance for Dishonesty or Arrogance

Timestamps: 33:42 – 35:41

• Major Red Flag: Hornick avoids founders who can’t admit when they don’t know something or who play loose with the truth.
  • “Every time I’m engaged with a company, I’m gonna dig in…and eventually we’re gonna get to a question you cannot answer…When people give me an answer to those questions, they disqualify themselves…It’s perfectly fair to say, ‘I don’t know the answer.’” (34:18, Hornick)

Notable Quotes

• On the role of the VC:
  • “I am someone who is your…confidant, coach, friend... If when you talk to these folks [my past founders], it doesn’t sound like you’re a cup of tea, then I’m not your guy.” (12:34, Hornick)
• On founder selection:
  • “I look at a thousand deals in a year to do one, so maybe two.” (14:51, Hornick)
• On the internet vs. AI as tech waves:
  • “The Internet is the thing that’s enabling all of the true value that AI is creating. The enabler was the Internet. Now…we’re going to go from…not AI to AI-enabled, and it will change everything.” (18:01, Hornick)
• On humility in founders:
  • “When people give me an answer to those questions, they disqualify themselves…To answer unanswerable questions with definitive answers is…to be untruthful, and I am not in any way interested in working with anyone who’s even vaguely interested in not telling the truth.” (34:18, Hornick)

Memorable Moments

• Hornick’s playful account of ditching VC “costume” for his trademark black T-shirt and emphasizing authenticity:
  • “I stopped and…have been wearing a black T shirt to work every day since.” (04:36, Hornick)
• Revealing the pressures of modern VC and urging diligence for both sides:
  • “You should probably take the time to get to know the people who you’re going to be working with.” (16:33, Hornick)
• On the emotional rollercoaster of VC-founder relationships:
  • “Rene [Bill.com] and I are totally married at this point.” (17:20, Hornick)

Conclusion

David Hornick blends storytelling, candid advice, and pragmatic wisdom drawn from two decades at the heart of Silicon Valley. This episode is a must-listen for founders, aspiring VCs, and anyone interested in the real inner workings of tech and innovation. Hornick’s enduring message: put people first, cherish honesty, stay humble, engage customers, and never underestimate the surprises ahead.