Progress Rewards those with the Courage...

🧠 Insights You Won’t Forget

Today's insights are inspired by a recent episode of Invest Like the Best w/ Jay Hoag

1. Consumer Internet is a Contrarian Goldmine

   Despite AI and SaaS dominating VC focus, Jay Hoag believes consumer internet remains deeply underappreciated. With 5B+ smartphone users and high engagement, he argues there’s substantial white space for new consumer franchises while most VCs follow hype cycles.

2. Tech’s Commercialization Lags, Ignore the Hype Curve

   Hoag warns that transformative technologies (like AVs or AR/VR) consistently take much longer to commercialize than expected. Investors should prioritize monetization models and defensibility over technical breakthroughs alone.

3. Best Companies Survive “Deserts of Disillusionment”

   Every major tech success (e.g., Apple, Microsoft) faced prolonged skepticism before dominance. Hoag stresses the importance of holding through cycles, staying committed during downswings, and recognizing that greatness is non-linear.

4. Growth Sits Between Venture and Private Equity

   TCV’s growth investing model mitigates early-stage tech risk and avoids financial engineering typical of PE. It focuses on scaling proven products with healthy adoption metrics and long-term compounding potential (e.g., Spotify, Netflix).

5. AI-Powered Sourcing = 11M Company Funnel to 6 Deals

   TCV’s sourcing engine leverages AI and data intelligence to analyze millions of companies. This highly automated, tech-first approach filters the noise and allows focused human evaluation of a few standout investments.

6. 3-Person Unanimous Investment Committee = Quality Control

   TCV’s final decision-making requires unanimous approval from a 3-person committee. This ensures disciplined conviction, reduces bias, and filters out marginal calls, even at the cost of passing on close contenders.

7. The Public vs Private Pendulum May Swing Back

   Despite the trend of staying private longer, Hoag remains bullish on public markets for top-tier companies due to benefits like liquidity, employee compensation, and capital efficiency. He questions whether private valuations can deliver exits without IPOs.

8. Great Investing Requires “Order of Magnitude” Talent

   Citing Reed Hastings’ idea of “stunning colleagues,” Hoag asserts that elite investors and operators aren’t marginally better, they’re exponentially better. TCV bets on people who fundamentally raise the game.

9. Avoid Herd Mentality in Strategy and Firm Building

   Hoag cautions against copying trending sectors or rapid firm scaling. He emphasizes starting with a unique focus, hiring only exceptional people, and growing patiently, even when contrarian.

10. The Pyramid of Success is More Than a Metaphor

    Inspired by John Wooden, Hoag operates with a personal ethos centered on preparedness, ethics, and doing your best to become the best you’re capable of becoming, an underrated mindset in finance.

Recall from last week

1. Unconventional talent strategy: Bet on mutants

   They consistently recruit atypical genius: MIT dropouts, Discord pseudonyms, gaming obsessives. What matters is potential, not pedigree. The Paradigm Fellowship and early-stage scouting reflect this philosophy of finding future outliers early.

2. Open-source as a compounding advantage

   With tools like Foundry (used by 90% of the industry) and Reth (10x faster Ethereum node), Paradigm gives away its technical edge. In doing so, it attracts top engineers, accelerates innovation, and deepens its influence over the crypto stack.

💡 Eko Worth Remembering

⚡ Active Recall – Test Yourself 

🛤️ Off the Record

This week, as we mark Juneteenth, a solemn and powerful reminder of how long justice can be delayed, I’ve been thinking about the parallels between historical progress and the kind of long-term thinking required in great investing. Juneteenth commemorates the moment in 1865 when freedom finally reached enslaved people in Galveston, Texas, two and a half years after the Emancipation Proclamation. It’s a vivid symbol of how change doesn’t always arrive when it should, and how recognition often comes long after the work is done. That idea echoed throughout my listen of Jay Hoag’s journey with TCV: a reminder that conviction, patience, and belief in unseen potential are often the defining traits of transformative builders, whether you’re talking about movements or markets.

Jay’s contrarian view that consumer internet is undervalued, despite everyone chasing AI and SaaS, feels timely on a deeper level. It’s a call to look where others aren’t looking, to listen where others aren’t listening. Juneteenth isn’t just a historical milestone: it’s a mirror. It asks us what truths we’re ignoring today, what overlooked opportunities might lead to greater equity, understanding, or value tomorrow. Whether you’re investing in companies, people, or change itself, the principle remains: progress rewards those with the courage to see what’s not yet obvious, and the resilience to keep showing up until it is.

Eko’s Top Pods

Answer:

Jay Hoag sees growth investing as a sweet spot between high-risk early-stage venture and financially engineered private equity. It focuses on scaling proven products post-technology risk, enabling strong returns with lower loss rates and little reliance on leverage. This shapes TCV’s strategy around investing in companies with real traction and long-term compounding potential, like Netflix or Spotify.

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