Dec 16, 2015 ยท 1 minute

“Sometimes a quarter is worth more than a quarter”

The hatchet man. The man with the golden touch. The yin to Tony Hsieh’s yang. These are all phrases used in the Valley to describe Sequoia Capital’s Alfred Lin. [Disclosure: Hsieh is a Pando investor]

Lin was one of our guests at our final PandoMonthly, and we got into his origin story as an entrepreneur… especially since it’s one usually told by the best-selling author, frequent speaker, and happiness deliverer Hsieh.

He had a few corrections on the mythic tale of how the two met. Watch the video for details.

But the overarching message was about trying to compound your company by 1% a day, rather than look for some pie-in-the-sky big idea that will make your company an order of magnitude better.

I asked him what was magical about Zappos. At the time Amazon bought it, it was the first $1 billion exit we’d seen in ecommerce for a long time…. and few of the ecommerce 2.0 wave followed.

He gave a few answers but the best one was this: “The other genius of Zappos is it was built with $10 million in primary capital. When Sequoia invested in Zappos it was buying secondary shares. I don’t think you could find many companies today that were that capital efficient… $10 million to $1 billion. There are very few of those examples.”

Particularly in today’s mega-round culture. Makes you wonder how many of those millions and how much of that dilution is really necessary.


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