The 4 Pillars of Venture Capital: $1B Venture Capital Fund Tells All

Hey, welcome to another episode of Making Billions, I'm your host, Ryan Miller and today I have my dear friend Jason Schuman.

Jason is a General Partner at Primary.vc and at a billion AUM, it's the largest seed stage venture capital firm in New York. Here he leads new investments across built world FinTech and marketplaces. Forbes even featured him on the top 30 under 30 in venture capital and venture capital journal named him one of the venture capital's 40 rising stars.

So what does this mean? Means that Jason understands how to find, analyze, win and support the best deals in the market, and he's about to teach you and I how to do the same.

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[THE GUEST]:Jason is a General Partner at Primary.vc and at a billion AUM, it's the largest seed stage venture cap

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• 20:25 (Cont.) The 4 Pillars of Venture Capital: $1B Venture Capital Fund Tells All

Transcript

Ryan Miller 
My name is Ryan Miller, and for the past 15 years, I've helped hundreds of people to raise millions of dollars for their funds and for their startups. If you're serious about raising money, launching your business or taking your life to the next level, this show will give you the answers so that you too can enjoy your pursuit of Making Billions. Let's get into it.

Ryan Miller 
My fellow venture capitalists may not appreciate this, but my next guest manages a billion dollars in venture capital investments, and he and I are about to crack open the four pillars of building your own VC fund so that you too can enjoy your pursuit of Making Billions. Let's get into it.

Ryan Miller 
Hey, welcome to another episode of Making Billions, I'm your host, Ryan Miller and today I have my dear friend Jason Schuman. Jason is a General Partner at Primary.vc and at a billion AUM, it's the largest seed stage venture capital firm in New York. Here he leads new investments across built world FinTech and marketplaces. Forbes even featured him on the top 30 under 30 in venture capital and venture capital journal named him one of the venture capital's 40 rising stars. So what does this mean? Means that Jason understands how to find, analyze, win and support the best deals in the market, and he's about to teach you and I how to do the same. So Jason, welcome to the show man.

Jason Shuman 
Thanks for having me, Ryan, I enjoyed listening to a few episodes recently.

Ryan Miller 
Yeah, yeah, it's been good. We've been in the top 2% in the world, all because of amazing guests like you. We're in 100 countries, we got family offices, emerging investment bankers and fund managers. We got all kinds coming at us. And it's truly an honor to have you on the show, brother, everything you've done your I would call you a young man, at least from my perspective, and boy, what you've done with your years, this is something we got to see. So it's truly an honor to have you on the show, so let's hit them right between the eyes, man. So we got a lot of people starting out and tons of experienced people, but for those that are really looking to master the fundamentals, what would you say to someone who's entering in the VC space they want to be a VC investor? What would you say to them? To A, how to win and get early points on the board, and B, how not to lose? What would you say?

Jason Shuman 
So I think venture capital, at the end of the day, is really about finding the best deals, which means that you need to see them, then you need to go out and analyze the deals and figure out, are they good deals to be doing, and then you need to be going out and actually winning those deals. And eventually, after you're winning those deals, you need to actually support them and figure out how you can add value. How you win deals is all about going out and building rapport with the founder. It's about figuring out what motivates them, what drives them, basically leaning into that connection because these are long term relationships. You know, I think the average marriage these days doesn't last too long, and startups sometimes can last longer than the average marriage, so it's really important to build that rapport with the founder and to show them value very early on in that relationship. And so one thing that we do here at Primary, for instance, is whenever we meet a company, we try to go out and add value from day one, what does that look like? It could be going out and introducing them to three to five potential customers in the first 24 hours after we meet that way, a, they're getting potential customers. And B, we're able to validate their sales skills and the demand in the market. Another thing is, founders always need to be recruiting new people, so it's really easy to show them, if you have a big network, hey, here's some great salespeople candidates. Here's some good candidates for engineering. Here's a good Chief of Staff candidate. It's all about adding value and identifying what it is that they need early on.

Ryan Miller 
Brilliant. You know, when it comes to finding the best deals, you and I have spoken offline, and we talked a little bit about having good ground game and air game. Maybe I'd love to hear your perspective on what that is and define that as far as you see it.

Jason Shuman 
Yeah. So this evolves over the course of your career and sourcing, especially when you're early on in your career. I like to call it the ground game than the air game. So ground game are the known ways that you can go out and source, no matter who you are. And so one example of that is by doing outbound. And what is outbound? Outbound is going and finding people who are clearly starting companies. The ways that you can do it are one. You can use LinkedIn. You can go out and find, if you go and search in the top tab where people who are working on something new, or stealth startup, or, you know, just like exploring new areas, it's amazing how many people put up what I like to call a VC thirst trap up there, because you can find it. They're making themselves known to you and so you can reach out to them and try to send them a thoughtful email based on if you can figure out what they're doing or not. You can try to express that you want to meet them. Another way that you can do that is by going out and looking in basically different places like PitchBook or CrunchBase, seeing what new companies been added to those databases and outbounding them there. So that's the first thing, which is like the ground game, and then you have like air game. And so air game is much more of like your proprietary network, and also things like blogging and tweeting. So if you're going out and building your personal brand and you're creating a point of view in a market. You can identify people by building networks within that market and trying to shake the trees to get people to come to you. So that's much more of like your inbound where basically the outbound side is the ground game.

Ryan Miller 
I love it. So inbound, outbound, ground game and air game. I absolutely love that. So ground game a little bit closer. These are friends, family, fools and followers. It's quadruple F. So working that list of friends, family, fools and followers. You didn't say that. It's just what I call it good. Ground game, right? Staying in touch, just really, just making sure you're having conversations with people that know you and you know them. Air game is just saying where it's kind of that lighthouse, and it's almost where people can see that beacon and say, Hey, that's a place I should go check out and here you are ready to do a deal. Absolutely love that.

Jason Shuman 
I would, I would. I would also just say one other thing, I think not enough people think about sourcing as a funnel. It is like any other marketing funnel. In any other marketing funnel, you have to go acquire customers from in multiple ways. You know, if you're selling software, you might have one motion, which is demand generation via email marketing, then you might have an outbound sales funnel where you have people banging the phones and trying to reach people. And then you might have content marketing. It's the exact same thing for sourcing in venture capital. You got to think about it like that. You got to track what are the best, you know, sources of leads, or in this case, what are the best sources of deals, and then try to optimize and fine tune those pieces out the funnel as well.

Ryan Miller 
Yeah, that's brilliant. And I actually teach folks how to raise capital myself, and that's one of the things, exactly, I agree, is we talk about you got to look at it as a funnel. Top of the funnel is awareness. What are you doing to get people to even want to do a deal with you? Do they you could be the best VC in the world that no one's ever heard of, right? Not helpful. What are you doing to create awareness? That's the air game, right? So are you going on podcasts? Are you speaking on stages? There's so many different things that you could do. Really think about that. So entering VC, make sure you got good ground game and great air game. But that's just finding the best deals. What else you mentioned? There was four other pillars of venture capital. What's the second one?

Jason Shuman 
So the second one would be analyzing deals. Turns out, you might be able to see a lot of great deals, but if you're not picking the right ones, because you're not doing the work to figure out if it is a great company or not, then you're probably not gonna have good returns. It's like, if I have Robinhood, I can buy any stock I want. That doesn't mean I'm gonna be a good investor. The same thing in the venture capital world, where you might see, for instance, we see, I think, over 6000 deals a year, we're probably going to miss on some, and we're only going to invest in maybe 15 companies a year. And so we need to make sure that we're being incredibly selective which companies that we're going to back. And that means getting really, really deep in a sector and in a space and within a company, and within getting to know a human being who's running that company to make a decision on whether or not we want to invest.

Ryan Miller 
Brilliant. And what are some of those things that you do implement when it's time to analyze? What do you look at just from a high level standpoint?

Jason Shuman 
Simplest way to think about it is you have team, you have market and you have product. So when it comes to team and founders, I think I like to break it down into a few, essentially personality traits that I look for in a great team. You want to find somebody who has a sense of urgency. You want to find somebody who is a learning machine. You know, you don't need to be the smartest person in the world, but you need to be able to learn from your movements and your iterations on a company. You need to be adaptable, and you need to be resourceful. And then I like to typically talk about three, three things that they need to sell, they need to sell people, they need to sell product, and then they need to sell stock. So people's recruiting, product is sales, and stock is fundraising. And if you can vet those three things, you're in really good shape.

Ryan Miller 
Brilliant. You actually talked about the next one was to win the best deals. What do you guys do to win the best deals in VC?

Jason Shuman 
You know, I don't want to give away all my secret sauce here, but as you said, you know you can't some of the best investors in the world. You know, you can't be, or you can't be one of the best investors in the world unless you see the best deals at the end of the day. You could also see the best deals, and then you could be the best picker in the world, but you're not the best investor unless you win the allocation and the right to invest in those companies. And so for us, what we've done is we've gone out and we've built an investment team of nearly 15 professionals. Now each one of those investors is a specialist. And so as part of being a specialist here at Primary, you are studying every company in the healthcare market, for instance. And my partner Sam, not only has he gone out and learned about the great companies that are later stage, far beyond where we typically invest, and what has made those companies successful. But he's also gone out and built up a customer network and an expert network. So if we're looking at a company that's selling into healthcare systems, he has CEOs of healthcare systems on speed dial. If we're looking at a company that's selling into Payers, he has CEOs of Payers on speed dial, and that way, when you've built deep relationships there, you can show a founder not only do you understand a market because you've looked at everything in that market, but you're also able to add value from day one, which means helping them generate revenue. Is what companies really need. Let's just simplify it. They need three things. They need customers, they need people, and then they need capital. And so if we can solve those three things and show that we can do that during the diligence process, we're typically in a very good place to win a deal.

Ryan Miller 
Brilliant. So you have an impact team filled with former executives and and their job is just to add value to any founders in any way they can. Is that right?

Jason Shuman 
We do? Yes, we have about 35 people here at Primary on our impact team. You know, platform at this firm is a very dirty word. You know, platform at other venture firms might be one person, you know, in their mid 20s, just playing dispatcher. I think the biggest difference that Primary has in comparison to a lot of other venture capital firms is we have those three former executives who run teams in go to market talent and recruiting essentially, and then Strategic Finance, and those teams can really go in and do work for you and be dispatchers, which increases the amount of output, really in the increases the probability of success for the companies that we're working with.

Ryan Miller 
Brilliant and the fourth pillar, supporting the best deals, maybe round that out for us.

Jason Shuman 
Yeah, I think we just talked a little bit about it, but basically the way I think about it is post investment. We usually do an onboarding with each one of the companies, and in that onboarding, we try to understand, what are the glass balls for that company? What do they need to really go out and achieve and validate from their hypotheses perspective, in order to go raise that next round of financing. And oftentimes it fits into those three buckets on the go to market side of things. You know, my partner Cassie and my partner Jason and their team on market development, they won't only coach the founders on things like reviewing their marketing materials, reviewing their sales pipeline. They'll help them set up sales capacity plans and compensation structures. And then our market dev team will actually do outbound for a lot of the companies, and they have about an 8x conversion rate compared to the salespeople at those companies previously, and that helps them accelerate growth. And then on the people side, our partner Rebecca, helps go and build these systems internally for these companies. We have embedded recruiters who have saved our companies millions of dollars a year in recruiting fees and placed people in half the time compared to in house recruiters and with higher success. So it's little things like that that are increasing the velocity of these startups, because the reality is, when you raise a seed, you maybe have 24 months of runway. So every month counts, and any lead that you can get in that first month, or any person you can get button seat in that first month is really value add.

Ryan Miller 
Brilliant. So we talked about the four pillars of VC and really coloring those out. Thank you for that. But that's not enough just to get some early points on the board. When you're investing in startups like we are, it's also you got to do a few things to not lose to not get wiped out. What have you found, and what cautionary tales could you share with some of the investors around the world as far as what not to do when you're entering the space of VC?

Jason Shuman 
Oh, man, I have more stories than I care to go through, especially in this down market. But the first thing I will say is we have a rule here, which is, you know, do no harm. And more often than not, investors can be not only no value, they can be net negative value. And so my thing is, and we have a lot of young partners here, a lot of people who are early on in their career, including myself. So the way that I think about it is, do not talk about something that you do not know for a fact. So if you're in a board meeting, or if a founder asks you a question and you don't know the answer, that's okay, but tell them you will go and find the person who has the answer to that question and then go do the work to get the expert on the phone or get the expert to meet with the founder, because those people are out there, and so don't let your ego get in the way and be like, I'm the smartest person in the room. I should talk to you and give you the advice, because chances are there's somebody out there who could actually give the right answer versus you.

Ryan Miller 
You know, it's a metaphor or that, I think of listening to that piece of advice is kind of staying in your own lane and don't talk about or don't talk about things. Pretend to be an expert when you're not. There's always, there's this old reality show, and I don't even know if it's around anymore, called Pawn Stars. And often these people come in with all these relics. It's a civil war belt buckle or a gold coin that belonged to some pirate. And the guy's like, yeah, I don't know anything about this. Like, he's smart, and he's like, look, I run a business, and I have to know this. People could sell me garbage or could be stuff that, because I don't know, big mistakes can happen. Just to illustrate your point, every time, he's like, I got a guy. Let me make a phone call and I'll get you the answer. That's exactly what you do. So if you ever seen this, the crude example is that that movie of Pawn Stars where he's like, yeah, like, I run a business, but I have a whole panel of experts, because I'm not an expert. I run a company, but if we're going to unlock profit, sometimes it's better to call a friend, so to speak, so.

Jason Shuman 
I'd say, by the way, most of the time, most of the time, that's what people will do.

Ryan Miller 
Even better. Yeah, as they should. So stay in your lane and lose the ego that makes you want to beat on your chest and say you're this alpha, whatever that you know everything about, everything you don't quit pretending that's the difference between being invincible and trying to be unstoppable. So those who are invincible find out real quick that they're not. But if you're unstoppable, usually get by with a little help with from your friends. So I absolutely love that and anything else with not to lose. What other advice can you give to these budding venture capitalists?

Jason Shuman 
I think talking about ego, we can talk about one other topic that's, I think, popped up a lot these days, and that is, don't lie to founders, be very transparent to founders. And the reason I bring this up is because I have seen in a number of occasions of late times where people have said to a founder and committed to a founder a certain amount of capital that they're going to invest behind the scenes, they need to go raise an SPV for that capital. And what ends up happening is there's a timeline between when they commit and when we need to close. And on more than one occasion over the last year, I've seen people who have gone out and tried to raise an SPV with high confidence and not only come up short, but come up like very, very short or come up with literally nothing at all. Now that is a problem, and the reason why it's a problem is because oftentimes these term sheets that founders sign, or other types of folks in different markets have to end up signing, have a minimum requirement of capital that they need to raise in order to close on a deal. And if they don't raise it, they might be out of money and so that is putting people at risk big time. So my advice would be one, be transparent. It's okay if you're gonna raise an SPV, but if it's not going well, you need to over communicate with the founder. And number two, think about what the founder has going for them. This is their life's work, they have employees. They might have employees that are on work visas in a country with children, that if they don't have a job, they're gonna need to move and if you're the person at the end of the day who ends up making it so they have to shut down their company, and all of these other issues arise as a result. I don't think that people are thinking about the downstream effects from their actions. And so that is really, really important to me, and a topic that I'm pretty passionate about.

Ryan Miller 
Yeah, and we always talk about reputation, relationships and results, that trifecta are the greatest assets in your possession, and so don't ever to echo your point. I 100% agree to echo that point. Be honest over communicate. Walk out. Good news. Run out bad news. Either way, you gotta let people know what's going on, because in the long run, it's gonna catch up to you. It's gonna ruin your reputation. Not worth it friends.

Jason Shuman 
100%.

Ryan Miller 
I love that. So how to win? How to get some early points on the board, on just doing deals from end to end, I love it, and then stay in your lane. Be honest and it should work out for you. But we're not done, so I'd love to talk and just get your opinion on the market. So what are you seeing out there?

Jason Shuman 
It's really a tale of two cities right now, Ryan on the AI side of things, it is wild out there. It's like a 2020, 2021, all over again. Think it's the first time in my career that I could say for a fact, that it feels like we are an unbelievable technological shift. And when technological shifts happen, massive returns come from it and as a result, we're like kids in a candy shop. It feels like it's going to disrupt every market under the sun and every use case you can think about and even not think about right now. And so a lot of people are going out, and they're hunting like crazy. And the venture market information has become far more democratized, so the ability to find companies is as well. And as a result, prices are going up. And so when we would have thought, when the market came down, and public markets included that the seed market that we play at would have come down into the maybe low teens from a valuation perspective, it's still hovering in like the mid 20s and low 30s. And part of that is driven by the efficiency in the market, but the other part of that, I would say, is driven by the multi stage funds coming down in the stack to invest in seed companies.

Jason Shuman 
And why that is is probably has to do with that other you know, tale of the cities that I was talking about, which is a lot of these older funds are underwater in some ways, and the older partners, who have a bunch of board seats, are in the process of working with those companies and trying to help them stay afloat, helping them recapitalize their business, helping them get through a down round, whatever it might end up being. And so a lot of the younger partners who don't have as many obligations and board seats, are really running around and going and doing deals. And it is harder, I would say, on average, for those younger investors to compete with, you know, older investors at the seed stage, and so oftentimes they'll overpay, that's one. The other thing is, though there are options, they're option bets for these funds. Because if I can go pay 25-$30 million and put a little bit of money in out of my massive fund, and then I'm getting the inside seat to figure out, is this AI bet going to take off or not, I can then lead the next round and buy up ownership even more. So you're really seeing that play out as well, where the market has a bunch of investors who are spending a lot of time portfolio companies, and then a lot of other investors, some of which there's overlap, are spending time in the AI world and trying to keep up with what's hot.

Ryan Miller 
Yeah, so a lot of recalibration, to put it nicely, that's happening, AI hype, it's a real thing. Maybe valuations are a little high, but then we got some of the older ones coming in a little bit closer to seed stage, because late stage tends to be taken I think if, if I'm reading the same data you are, there's some some spanking that's going on on those late stage VC funds. So yeah, as as I hear some other VC guys saying, stay alive till 25 that's their motto. So wish you all that's your motto in your company I wish you the best of luck, that's the love here, brother. Now, that's where what you're seeing right now. But I'm curious, where do you see the market? Where is it going? Where does the smart money going? Where are those opportunities from your perspective.

Jason Shuman 
So, I mean, I don't wanna go overly broad with the AI thing, but what I'll talk about is there's infrastructure, which is, like, below the app layer that a lot of money is going into, and then there's above the app layer. There is the app layer that people are going after. And the way that I think about it, at least in terms of vertical AI, which is where I'm spending a lot of my time, people have the ability to go out and do things that they weren't able to do before. And so the themes that I would highlight are one, do it for being software. What do I mean by that vertical, SaaS, companies that built systems of record, meaning like the service titans of the world, you know, those companies or CRMs, like a Salesforce. It has. We've lived in a world where you have to type things into the CRM every day and add all this data in, and then it's kind of like, it's gotten a little bit smarter from like a drip marketing perspective, but it hasn't been like, great. Now we're moving into a world which is do it for me. And so at some point, you used to do your own trading, and then these, like robo advisors, came out. It's the same thing for vertical software, where small business owners will no longer have to worry about paying a marketing agency to go do their marketing, or they have to go and run their own Facebook ads and then answer the phones and answer their emails. All of that stuff in the future will be automated by the use of AI. And so I think that's one of the core use cases and things that there are opportunities that's out there.

Jason Shuman 
The other opportunity I would highlight is what I would call counter positioning. And so counter positioning, which, if you haven't read The Seven Powers, highly, highly recommend reading it. Very valuable book, counter positioning is going out and doing something that if your competitors were to do it, it would be like committing suicide, like, not literally, but it's like their stock price would tank. And an example of that is if you go out and look at consulting firms or other types of services that are being provided on an hourly basis, these are things, maybe like an architecture firm or a design firm, and when you're doing the design you're making your money on an hourly basis. You're not going to be incentivized to use an AI tool, because your number of hours to do a job gets reduced dramatically, right? So what you can do is you can build a firm from the ground up, using AI tools in underprice by 50% and now you're not only a cheaper product, but you are probably a better product and a faster product. Which cheaper, better, faster, always wins. And then if you can figure out a workflow solution to tack onto the end of that product, that of that service, you're in very good shape to build what I think will be a monster outcome.

Ryan Miller 
Brilliant. One of the things we love to do is to just give our listeners a competitive edge from absolute pros like yourself. So if someone was going to come to you and say, to you and say, hey, you know what? I'm pretty good. I love this, this area, this sector, what secret sauce can you give them to give them an unfair advantage? What would you tell them?

Jason Shuman 
Oh, I have a bunch of pieces of advice that I've learned over the years. One of them they'll give you like my dad taught me when I was younger, that you really need to treat people the way that you want to be treated. And the VC world is very, very small, and you need to take every interaction like it's a first impression that you need to make in a really strong way. And so for me, I think that every meeting you go into bring your best self into that meeting, good energy, be a kind human. Know that the person that you're working with or talking to, you know, this is their life, this is like their dream, their baby that they're putting into this and figure out how you can add value to them. And it could just be, you know, giving them feedback, giving them a case study of another company they need to look for, giving them an introduction. There's so many different things that you can do, and so by doing that and adding value, I think what you'll see happen is it'll compound, and I've personally seen it, it'll compound over the years, and then people remember you and going back to that funnel that we talked about at the beginning, it will add value to the deals that you'll be seeing in the future. And one way you can measure it is the companies that you pass on, how many of them have sent you a deal in the future.

Ryan Miller 
That's a good Gage. Yeah, I love that.

Jason Shuman 
There are absolutely no shortcuts. VC is a grind. This is a world in which a lot of people that get into it were founders and CEOs of massive companies before. You know, Peter Thiel, PayPal, Reid Hoffman, LinkedIn, you know Alfred Lin at Sequoia was at Zappos, before Roelof Botha was plenty of companies, people are very well connected. You. If you're gonna get into venture you better be so freaking hungry and strap yourself in for what's going to be a at least a 20 year journey. I mean, I know I look young, but I've been doing this for almost 10 years now, and I feel like I'm like, just starting, because it takes 10 years. To get exits, and then it probably takes another 10 years after that in order to really find your groove, because you're going to start seeing better and better deals, the better and better that you're getting in this market. So that's a definitely a big one for me. Is just like staying persistent, staying hungry. It's a huge factor when it comes to success in this world.

Ryan Miller 
Brilliant. Do you have a third one?

Jason Shuman 
Yeah, I think you and I were chatting the other day, and I told you a saying that I have, that a lot of people talk about in our firm, which is that nos are free. Yeah. What do I mean by nos are free? I mean, just like, take your shot, you never know who might respond to something, and you should probably just not be afraid to ask for what it is that you want to go get. And so there's a story that happened recently that I think about, which is I used to send out, like, one or two emails a week that made me feel uncomfortable to try to meet with someone that I probably couldn't get in touch with. And back when I was younger, that was a easy thing for me to do, because I was like, just grinding, grinding, grinding, grinding. And then I got a little bit more successful and a little bit more senior in my career, and I found myself not doing it, and I was asking myself, why the other day, why am I not just cold, reaching out to more people? And I didn't really have a good answer for myself, so I really wanted to get in touch with the former CEO of Autodesk. And Autodesk, for those of you that don't know, it's a $50 billion publicly traded company. It is a pretty big deal in the design, manufacturing and architectural world. It's pretty much like the tool set. So I want to get in touch with this person. I went on LinkedIn because I figured, okay, I'll send him a LinkedIn message, or I'll find my mutual connection. So it turns out he's not on LinkedIn, so that's hard. And I went on PitchBook, and I tried finding his email on PitchBook, couldn't find his email where sky exists, like, what the heck. So I googled his name, and I came across his Instagram. Yes, his Instagram and turns out he was living in Berkeley, California, and is, you know, making some electric cars out of uh old, really, really cool, old car, antique cars, and a variety of other like things with wood making that I found to be absolutely credible. And so on Instagram, I literally slid right into his DMS and wrote a note about, you know, how I felt like we have very similar interests, because we do, and it's genuine. And same time, I'd love to talk to him about some things that I was interested in and getting his feedback on and literally, within an hour and a half, he messaged me back. He gave me his email address. I emailed him, and we set up a call, and we had earlier this week.

Ryan Miller 
Man, brilliant. So speaking of VC thirst traps, you mentioned before, that's one of those on Instagram that it's actually good for you, it's, and I'm glad that that worked out, I've done that too. So folks like you get all the glitz and glamor with VC and yeah, sure, there's some of that. Maybe once you have an exit, or a founder has an exit, but in between that, it's just being resourceful and scrappy, like you were saying, and finding ways, alternate ways, to locate people. I've had the same thing contact in a firm, a funding firm, that's been around since the 1800s email after email on their contact us page, not a single response. I'm like, What the heck.

Jason Shuman 
I could tell you, the amount of stories I could tell you about times where I got out of a board meeting and I was like, wow, I wish we could find, like, one person who could tell us how to fix that thing or how to get in touch with that company. And what I will tell you, this is a true story, I'll give you two examples. One, I found the former CEO of a company that kind of came before another business in our portfolio and sold into one of the largest infant formula brands out there in the world, and we were just starting to engage in dialog with that company. And I wanted to reach out to and find the guy who used to run the company that sold to this large company. Found him on LinkedIn, cold messaged him, talked to him. A week later, he came on. He's now an advisor. He's helped us work with that company, and, you know, locked in a lot of enterprise value that moved the needle. The second one that I ended up doing was I reached out to the former CTO of a company that was in a market that one of our best performing portfolio companies is in, because we needed to improve gross margins and we needed to improve our supply chain. And reached out to the guy. He walked me through exactly what the differences were in their supply chain versus our supply chain, and he came on board as an advisor. And what happened? The gross margins of the business increased by 62 points over the course of 16 months, 62 point, not not bits, I'm talking about points. And that was in large part because we understood what great looked like after we had that conversation. And so that goes back to again, don't answer the question yourself. Go find the person who's gonna have the answers to the question.

Ryan Miller 
Yeah. And, you know, putting in a lot of work, and I'd love to get your thoughts on this, but putting in a ton of work, or, well, you know, to overly sanitize it, your inputs. So working on that, you got 1000 things going on, and staff and employees and port-cos and all of these things that are happening. What's your opinion? As far as productivity generating max output, you have to do it as a firm, but you also have to help your port-cos and your CEOs to do that. Do you have any type of secret formula or anything at all that you guys implement at Primary to really help people to optimize the productivity and ultimately take care of your investors.

Jason Shuman 
I would say that this is much more of a personal way that I look at this than maybe a Primary way. But if I take a first principles approach to output, there's really three variables that go into it. So the first is number of hours, how many hours are you working on the thing? And then the second thing is number of actions, like, how many inputs and literal things are you doing? How many calls are you making, how many emails are you sending, so on and so forth. And then the last one is just the quality of those inputs. And so, if I am working for 10 hours, and I am reaching out to a bunch of bad leads for a portfolio company, and it could be 1000 it's not going to add a lot of value, like, that's not good output. But if I'm working for two hours and I'm sending 20 emails to the highest quality customers in the world, that creates an immense amount of output. And so it's not just about and reason why I bring this up is it really is not just about working hard, but it's also about working smart.

Ryan Miller 
Brilliant. So hours, actions and quality of inputs. I love it. So as we wrap things up, is there final thoughts? Is there anything you'd like our fans around the world to know, or any closing remarks?

Jason Shuman 
I would just say, if you're starting a company and you are thinking about raising capital or even just want feedback on an idea, reach out to us, Primary, nothing's too early, and you can find me on Twitter, Jason R Schuman, or you can slide right into my LinkedIn, DMS, preferably on Instagram, I'd rather not get that bogged down.

Ryan Miller 
Perfect. So just to summarize everything we talked about, perfect, how to see, analyze, win and support the best deals. The next thing is, just remember to treat people well. What you put out, it does tend to come back, this is a small world. And number three, nos are free, so just take your shot, man. And finally, number four, focus on your inputs. Those are in your control, and that's simply just a number of hours, times a number of actions, times the quality of input you do these things, and you too will be well on your way in your pursuit of Making Billions.

Ryan Miller 
Wow, what a show, I hope you enjoyed this episode as much as I did. Now, if you haven't done so already, be sure to leave a comment and review on new ideas and guests you want me to bring on for future episodes. Plus, why don't you head over to YouTube and see extra takes while you get to know our guests even better. And make sure to come back for our next episode, where we dive even deeper into the people, the process and the perspectives of both investors and founders. Until then, my friends, stay hungry, focus on your goals and keep grinding towards your dream of Making Billions.