Lessons from Arjun Sethi

On Venture Capital and Investing

On the core of venture capital: "We have a motto internally, which is, 'how do we focus on what versus who you know?'" [1]
On the evolution of venture capital: "Why are we still using Excel why are we still using paper and pencil to make investment decisions it doesn't make any sense to us." [1]
On data-driven investing: "Any company that builds software is measurable and you just have to understand what are the demand signals that you care about with your investment framework and philosophy to invest in that company." [2]
On identifying potential: "We generally on the venture side are looking at 3 to 5x year over year growth in something it could be users could be revenue could be customer engagement." [2]
On the nature of successful companies: "Any successful company is not successful because they have copied someone else's framework." [2]
On Tribe Capital's unique approach: "I always tell people that Tribe is a interpretation and an artifact of our world point of view it's not that tribe is everything for us but it's a an extension of how we kind of think about the world." [3]
On the challenge of being different: An LP told him, "Look Arjun the hardest thing about what you guys do and how you think is that I we can just never put you in a box." [3]
On the balance of art and science: "If you don't have a scientific approach or a methodical approach to get there so that you can have trial and error I think you just get into these notions where you can be making mistakes in a cyclical notion and you actually don't even know what's working or not." [3]
On long-term vision: "My whole aspiration day one was I want to build a technology company and so a technology company that deploys capital." [4]
On the importance of mentors: Sethi credits mentors like Ariel Poler, Brian Pokorny, Ron Conway, and Hiten Shah for his initial foray into investing. [5]
On learning from losses: "As time went on and I began investing larger amounts of capital, I started losing money and it led me to recognize the stark contrast between the general approach of gut-driven investing to our well-oiled approach of data-informed product development." [5]
On the definition of "N-of-1" companies: These are unique companies that create and dominate a new market niche, in contrast to "1-of-N" companies that compete in existing markets. [5]

On Startups and Entrepreneurship

On the entrepreneurial mindset: "It may not matter if you're an entrepreneur or a venture capitalist or someone who works it's more about what your mentality is towards what your north star is and and and what that means for you." [6]
On finding your path: When starting out, it's important to have a "widespread mentality before I go a little bit deeper." [6]
On the power of hard work: "You just cannot beat someone who works harder they don't have to be smarter but they just work harder and smarter they're just that much better." [6]
On the reality of success: "Success is never a straight line and involves failure and unsuccessful attempts." [1]
On the importance of community: "Achieving success requires exposure to the people and community where you're involved." [1]
On learning from failure: Lessons learned from previous unsuccessful start-ups can help create an even stronger team, where each member brings distilled ideas. [1]
On the founder's journey: "I was rapidly learning and iterating what I needed to do and if I thought about myself as a product what did I need to do in order to become a better leader." [7]
On avoiding hubris: "When you finally succeed all of a sudden it gets to your head and you just have this massive hubris that everything I learn now is just going to continue on the same pathway And I think that was the biggest mistake." [7]
On the value of being open-minded: "How can you be open and stubborn in some cases but willing to change your mind when you know you're wrong in a way in these early days." [7]
On the early signs of product-market fit: Even with just six months of data, and no revenue, patterns in user interaction can indicate product-market fit. [3]

On Data and Product

On the centrality of data: "The most important narrative of how I've spent most of my time has been around the aspect of data and how you can use that and interpret it to make better operating or investment." [6]
On the origins of his data focus: His experience in social and mobile gaming, where they had to "build infrastructure to be able to analyze all of this in real time," was foundational. [3]
On the goal of product analytics: "How do you get informed and interpret that data to make a decision." [3]
On the importance of product-led growth: "Everything started with the product and team... This is how I think about being product-led and team-led as opposed to being business or sales-led." [5]

On Cryptocurrency and the Future of Finance

On the future of crypto: "I just think you're going to see a compounded growth rate. We will see drops just like any other market But that's just typical market technicality." [9]
On the transparency of crypto: "If you go down into the details around the types of things that happen in crypto, they're transparent. So when something happens, you can fix it as soon as possible." [9]
On crypto's resilience: "We saw our banks here in the United States fail... I'd say we created our own self inflicted wounds [in] crypto during that time but we came back faster." [9]
On the potential of tokenized equities: "Tokenized equities are going to be larger than stablecoins like Tether, with futures and options on top." [10]
On the global accessibility of tokenized assets: Sethi is positive about tokenized equities due to their transparency, speed, 24/7 trading, and easier worldwide access. [10]
On Kraken's broader vision: "You can't think of this as just an exchange layer, it's like a technology layer with an exchange that's got a trade engine that's got liquidity and you can build a multitude of applications on top of it." [10]
On the goal of financial inclusion: "One of my goals at Kraken over the next 10 years is how do we just get more free products out there for the underbanked." [11]
On the efficiency of crypto: "Why we can bring down the cost of remittances spread from seven to 1 to 25 basis points should be a part of the conversation and that's what crypto enables." [11]

On Leadership and Management

On his management style: He describes his approach as quantitative, transparent, and even "micromanaged," a style the co-founder of Kraken sought him out for. [9][11]
On adapting to a new culture: "A lot of people [say] you need to do a cultural shift, you need to do some sort of shock and awe. I don't think that actually works very well, because you are throwing away the most innate talent at the company without understanding where they could be force multiplied." [9]
On empowering teams: "How do I go to every team and enrich them with the KPIs and operating metrics that matter for their business, and let them come up with their own interpretations of what they should be doing?" [9]
On managing a large number of direct reports: Sethi uses bots he programmed to digest the vast amount of information he receives from his "50 to 70" direct reports. [9]
On preparing for rapid growth: "You're never going to be ready for hypergrowth. That's the whole definition of it." [9]
On building a foundation for growth: "Building out your foundation for compounding growth sets you up for high growth whenever it shows up in those markets." [9]
On the importance of transparency in private companies: "Whenever I've gone to any private company... [to ask] how do you become more transparent? How do you build more trustworthiness?" [9]
On the nature of remote work: "If you segment what people do at any given stage zero to one you're brainstorming you're with people once you get a product out to scale you're starting to add more functionalities that becomes much more remote." [11]
On continuous learning: "I don't think there's a day where there isn't something new that you're going to be able to learn." [9]
On his personal drive: Growing up with a father who emphasized survival, Sethi developed a perspective of trying as hard as possible to succeed. [1]

Learn more:

Lessons from Arjun Sethi

On Venture Capital and Investing

On Startups and Entrepreneurship

On Data and Product

On Cryptocurrency and the Future of Finance

On Leadership and Management

Written by Antoine Buteau

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