Maxine Minter:

Okay. Three, two, one. Hey, I'm Cheryl.

Sam Wong:

I'm Maxine. This is First

Cheryl Mack:

Check, part of Day One, the network dedicated to founders, operators, and investors.

Maxine Minter:

If you want to be a better early stage investor, this is the show for you. So TLDR,

Cheryl Mack:

if you don't want to suck at investing, listen up.

Cheryl Mack:

Today we have

Cheryl Mack:

Sam Wong, who is a partner at Blackbird Ventures, one of the longest standing, if not the longest standing, uh, venture fund in Australia. Maxine, what do you love about

Cheryl Mack:

Sam?

Maxine Minter:

Ah, so much. Actually, Sam was the first person I ever met in Venture. I didn't actually know it at the time. I don't know if you remember Sam when we had that conversation when I was doing that course up at Bond.

Maxine Minter:

You were the first person I ever met in that Venture space and from that moment, just so like precise. Thoughtful. Highly credible. I didn't even know in the topic that you were highly credible, right? I had like no context, but I just remember being so blown away by the way you approached it. And then since then, just like every single interaction, I feel like I'm talking to someone who thinks light years ahead of me.

Maxine Minter:

Yeah. Who is the lines of inquiry you explore, which is why I'm so excited to dive into that today. I just find so amazing. So I really, I'm so excited to get to open source this conversation with you today and selfishly get to spend 45 minutes just peppering you with questions.

Cheryl Mack:

Yeah. Cause the way that, the way that you ask questions, I think I'm like, that is what I wanted exactly what I wanted to know, but wouldn't have thought to ask it.

Cheryl Mack:

At all, or even in that way, if I did think to ask it. So I think for me, when, yeah, when you ask questions of founders, I get really excited because I learned something. But also what I really love is that you were just like, one of the first people to identify New Zealand as a space that was exciting and then decided to pick up and go move there.

Cheryl Mack:

Like, who does that?

Sam Wong:

Crazy people. Right? Um, so I'm also really excited to

Cheryl Mack:

learn, like, what have you learned investing in New Zealand over the last however many years? So yeah, um, let's get into it. So the first question we always ask our guest is, what is the first thing that you ever

Sam Wong:

invested in? Um, I think the first thing I ever invested in was actually sort of real estate.

Sam Wong:

So my first apartment, I think I was. Maybe 25 or something like that. And I'd really scrimped and save in my first job, um, to save together a 50, 000 deposit. And this is back when there was the first time owners bonus. So I think it almost like doubled that maybe more. Um, they waive stamp duty on your first home purchase.

Sam Wong:

And I found this tiny but lovely Art Nouveau apartment in, um, Potts Point, and I just loved that apartment with like all of my being. Um, and I borrowed like 90 percent and then the 50 plus the government money, et cetera, was. How I managed to buy it and, you know, 10 years later when it was time to buy sort of a family home, the only way I could afford to do that was to sell that apartment regretfully.

Sam Wong:

And in that time it had, um, basically my 50, 000 of dollars saved to turn into half a million dollars. And so much of that, I know, right? And I'm like, hold on, these are venture returns. And really so much of that is because of leverage, right? Um, the bank gives you 90 percent of the asset value and the government actually gave me some too, uh, if you think about it.

Sam Wong:

And obviously compounding had a role to play. And then because it was my primary place of residence, um, it was tax free. And so your net return. It's honestly like, you know, really, really good. And I, and I learned a lot of like, almost the kind of rudimentary stuff around asset classes and investment thinking, and honestly, the importance of tax policy, if you want to think about how to direct capital in society towards activities that are more or less productive or, or, or what have you, but yeah, I really wish I hadn't sold that apartment to be honest.

Maxine Minter:

Heartbreaking. Wow. That is a cracker of a first investment. I actually think that's maybe the best return we've heard of yet in a first investment. It's

Sam Wong:

definitely better than Dan's who lost 500K, I think.

Maxine Minter:

Yeah. I, um, one of my moments that I, one of my conversations I remember most. with you Sam was we were talking about the first angel checks we ever wrote and actually up until that point I was really ashamed of the fact that my first ever angel check was like itty bitty tiny like spare change for the founders kind of thing and I remember you mentioning if I my memory serves me you mentioned your first investment was also 2, 500 and I remember being like Oh, my God.

Maxine Minter:

She did that too. It works for her. I can talk publicly

Sam Wong:

about it. You've been proud of it ever since. I have. I

Maxine Minter:

have. Because, like, of that permission that you would be like, oh, I did that. I kind of wrote that first tiny check. And now I feel like it's even more talked about, like, that it's beneficial. It's helpful to kind of write that first check.

Maxine Minter:

I'd just be interested to know. So what was the story there and what's your current thinking on writing those tiny checks into this ecosystem? Is it valuable? Is it

Sam Wong:

not? Well, it was zero or 2, 500. Right. Like I didn't have more than that to invest. And honestly, I think. What I love about those tiny checks is they're actually more about the relationship and like can a founder be bothered giving you a line on their cap table when the money, you know, like doesn't even cover a week of runway, really?

Sam Wong:

And I think that particular one was You know, the relationship I'd built up with the founder and they didn't, they knew I didn't have any money. I was just a poor founder like them, like the year before. And so I think honestly, they were like flattered and like chuffed that I wanted to invest and like maybe a bit nervous cause they didn't want to, you know, lose money.

Sam Wong:

But I think that they were kind of grateful for it. Not because it made such a big difference to their runway, but because it really showed how much I believed. And It's funny because I, even though obviously I can write much larger checks now from the fund, it's always, it just comes down to the relationship you have with the founder, whether that check will be accepted.

Sam Wong:

Right. So I think you actually learn something really valuable writing small checks early about. How to build a relationship, how to frame, you know, why they should take your money and all, all of that. And those are skills that are good to learn in this, in this business. There's a

Cheryl Mack:

reason we call them learning checks, right,

Sam Wong:

Maxine?

Sam Wong:

You get to learn so much

Cheryl Mack:

with those first ones. I think it's also about when you write those checks, you get involved with the founder and Learn along the way and say, well, you know, this didn't work out, but what would I have seen, or what could I have seen on that first couple of meetings that maybe I would have picked up on, or might pick up on the next time as well.

Cheryl Mack:

I think it's almost like a badge of honor now, if you can write a really small check. Like, I keep hearing the story of somebody who invested 500 in Canva, like, one of their earliest rounds. Stop that, really? Yeah, I've, I've seen their, like, I've seen their cap table screenshot of somebody who wrote a 500 check.

Cheryl Mack:

And of course that turned into who knows what, because I'm bad at math, but I almost feel like that's a badge of honor. Like who gets in on a cap table at 500? So do you think that that's still possible in this,

Sam Wong:

like, in this environment? Yeah, we actually had a portfolio company who was really keen on, in particular, bringing founder Money in and so they kind of went around and collected, you know, a half a dozen or a dozen similar size checks to 2, to 5, 000 from founders who were only, you know, a couple of years ahead of them.

Sam Wong:

So, um, absolutely. I mean, I think again, it just comes down to relationships and, and the value you think that founders think that you'll, you'll bring.

Maxine Minter:

Absolutely. I also think it's like on the investor side, I've noticed a lot of folks that are angel curious, that I think would be amazing angels, but there is still a kind of risk barrier or, in a lot of circumstances, imposter syndrome, or kind of perceived incapacity on their side that stops them from writing that first check and actually knowing that they can.

Maxine Minter:

You know, this is a small amount of money, but it's coming with all of my heart, like all of my focus. Yeah. I also think that normalizing being able to write a smaller check changes the demographic of who participates in angel investing. Totally. And then you start to kind of get your fee under you and learn, and then you can kind of build from that.

Maxine Minter:

And if you're any good at it, ideally those returns start to, you know, uh, pay for the next generation of checks and they are no longer 2, 500, you know, like we build in that way. Exactly. So I think that's a cool thing. I actually think that you're maybe the first person, at least that I know of, that started the kind of 2, 500 clubs.

Maxine Minter:

So I'm excited to be part of that club.

Sam Wong:

We should find more 2,

Cheryl Mack:

500 clubs and then we can find 20 grand clubs for me.

Maxine Minter:

Absolutely. Absolutely. So for me, this moment really pulls out your leverage in the ecosystem. Right. I think about my own experience with you when I like had that conversation with you and it gave me implicit permission to start to talk about my own, like the true version of my own angel investing journey.

Maxine Minter:

And you know, you are an OG of this ecosystem. You have built such an incredible ecosystem around you and continue to do that in New Zealand. I would be interested to know how you think about leveraging yourself and building. impact into the way that you build an ecosystem?

Sam Wong:

I'm actually not sure if I understand the question, Maxine.

Sam Wong:

I don't think of myself as a builder of the ecosystem or anything like that. I think I'm someone who was lucky to join Blackbird at the time I did, at the stage that the ecosystem was at. And Cheryl, you, I mean, you were there too, right?

Cheryl Mack:

Yeah. Yeah. We've known each other for what, nine, nine

Sam Wong:

years? Yeah. And so, you know, you could probably say there were like 300 people equally ranked in terms of like, we were all there and we just didn't leave, you know?

Sam Wong:

And I think that's the beautiful thing about like, if you just don't leave, like human compounding happens, right. And, you know, you learn some stuff, you build some relationships, some of them, you know, get stronger, et cetera, et cetera. And like, and I think that's all an ecosystem is. It's just, it's just a bunch of people.

Sam Wong:

Um, in a network, um, that has had time to like, you know, form layers and enough interconnections and all the rest of it that it seems like a real thing. Do you know what I mean? Absolutely. I think

Cheryl Mack:

you were one of the first people in the ecosystem to be promoted to partner internally,

Sam Wong:

correct? Yeah, I think, well, Nick and I were promoted at the same time.

Sam Wong:

I'm going to say yes, just, but I, I really don't, I don't know. Somebody fact check that I, based on my knowledge of, of

Cheryl Mack:

the VC growth at that time, when around, when you were promoted, I I'm pretty sure that was like, it was catalyst because it was like, look, there, there are funds who are promoting internally partners.

Cheryl Mack:

And especially, I think you were definitely the first female to be promoted internally, to be partner in the ecosystem. I think that's true. Yeah. And I think that isn't just because you didn't leave. There are a lot of things that I feel like you did in the ecosystem to build connections between founders and people like myself who were the, like, more traditional ecosystem builders in the early days.

Cheryl Mack:

And I think also there is something special about what Blackbird does in the ecosystem as well. Um, so maybe you could talk a little bit about, like, what do you think are the things that you did in the early days to really cultivate that magic?

Sam Wong:

I mean, I think, I mean, part of the reason why I joined Blackbird and Never Left is because I love the sense of responsibility that Blackbird has taken to the idea that if you, you know, you can't just profit from the ecosystem, you have to take responsibility for building it too, and building it in a certain way.

Sam Wong:

You know, I got introduced to Blackbird, I think it was 2013, uh, when I was starting to kind of work on my own startup, I'd just returned from Europe. I didn't know anyone in Australian startups because before I left Australia for Europe, I was a lawyer. So I really didn't have a relevant network. Ah, another ex lawyer.

Sam Wong:

I've seen.

Cheryl Mack:

Ex lawyer club and 2500

Sam Wong:

club. Yeah. And And then I was working at Tankstream, co working Blast from the Past, and like, uh, Fred Kimmel from Handcrafted, which is still, still around, like, he was like, hey, there's this conference next week, Mike Cannon Brooks is going to be speaking, like, do you want to go?

Sam Wong:

Tickets are like, 35 or something like that, but it was something insanely cheap and it was sunrise and it was the very first sunrise. And so I went along to that with Fred and, and that was how I first got introduced to Blackbird. And it was like maybe 400 people or something like that at, uh, gosh, what's that place in Redfern where we host Everly, you know, carriage works and it was so like, so grungy and embarrassing compared to like how we do sunrise today because.

Sam Wong:

You know, no one who knew how to do events was organizing it. Like there was no food, there was no coffee. It was just, you know, it was like these founders who had built these great companies on the stage, warts and all kind of like telling it how it was. And there was just no access to that in. Australia in 2013 at that time.

Sam Wong:

And, you know, I met all these people through that. That's where I heard about start made and thought, Hey, I'll throw my hat in the ring for that. And then of course I went through start made. And so to kind of come back to your, to answer, you know, the original question, like I think with Nikki and Rick, it's always been very intuitive to him.

Sam Wong:

I mean, Nikki started. You know, start mate to get a bunch of 2, 500 is to be probably right together to like pull their funds to be slightly less embarrassing amount to invest in startups and help them. And I think that is just a very native behavior for both Nikki and and Rick to like be very community driven to help founders connect to other founders, um, and, and to believe in like the power of bringing.

Sam Wong:

People together and the serendipity that happens there. And so I think we've just been quite instinctive about. Everything we've done since then, or that has happened since then, has stemmed from those early decisions around, you know, uh, running things like the Sunrise, and which itself was really just a kind of consequence of the fact that our LP base at that time was 96 individuals who were all tech founders, and so that seemed like a very logical thing to do, and these things have kind of compounded over time, so when we're trying to do You know, very, very early stage up sourcing stuff like giants, for example, you know, it doesn't, it doesn't occur to us to do it any other way than, okay, let's find people who want to give half an hour of their time to really early stage startups and let's do it virtually.

Sam Wong:

And let's try and like match as many people as possible. And you know, that kind of thing. Hopefully that kind of. Answer, I guess, how I think about ecosystem development.

Maxine Minter:

I don't know. I think it's really interesting that it's so, like, it's built into the DNA of the fern. And also, I think I have seen for all of the partners at Blackbird, it's so innate into the way that you think about it.

Maxine Minter:

I don't know if that is because of being part of the Blackbird culture, and we kind of foster that in each other, or if that's. Something that you're going to filter for on the way in. I do think my observation of watching you operate, and I know conversations we've had in the past about kind of this idea of leverage on your time, I think, especially by being a first, you know, very early in the ecosystem, first woman to being promoted within a font or, you know, asterix fact check.

Maxine Minter:

So thinking about like the. position of influence you have in the ecosystem, it seems to me that as a result of that, you get an enormous amount of outreach, right? Like an enormous amount of time. As you are continuing to build a fund, you know, scale the actual business around that fund, continue to make investments, portfolio support, et cetera.

Maxine Minter:

And you have a really interesting way of thinking about how to get leverage on your time to make sure you continue to have that impact, continue to foster the world around you and do the things that you want to do. need to deliver. So I'm wondering, you know, how do you think about leverage on your time?

Maxine Minter:

How do you think about what makes the priority bar for what you focus on today versus what doesn't and how do you

Sam Wong:

move it over time? I mean, this is like the toughest question ever, Maxine, because I don't know anyone who feels like they're really nailing it, right? But at least for me, especially after becoming a parent, I just had to ruthlessly prioritize and I kind of every year.

Sam Wong:

I have a kind of OKRs of myself kind of thing, which obviously very aligned with work related OKRs, and I break those down quarter by quarter and I have like the, these are the three things in, in these four buckets and there can't be more than four buckets because stuff doesn't get done if there are more than four buckets and there can't be more than three things per, per bucket because also more than that doesn't get done.

Sam Wong:

Um, and if it doesn't fall into that bucket, it just can't receive priority then. And I also, you know, have started to feel a lot more like, instead of just going with, Oh, I really want to do that, or I really feel obliged to do that. Trying to optimize for like one to many experiences or ever, like, so for example, this one is a good one, things that are evergreen, I can write it, write it down and put it somewhere on the internet.

Sam Wong:

As opposed to having the same conversation, uh, many times over, love to do that too. But it's probably imperfect to be honest. And then I also think long, long term, we're so early in developing the Australian ecosystem and definitely the New Zealand ecosystem. And I kind of, even here in New Zealand, I sort of strip it back to like, well.

Sam Wong:

You know, we're not going to have a fund three if we don't have a successful fund one and fund two, you just can't take that for granted, right? Like fund three is often, you know, a lot of people just never clear that. And so what is it, what does it mean to have a successful one and two? And what do, what should that look like at an activity level for me and the team?

Sam Wong:

Do we have all the resources we need or capabilities or whatever? To hopefully make success of those activities inevitable. Um, there's obviously so much that's not within your control, you know, once you've invested, but I think there are a lot of things that you can do to increase the probabilities of success.

Sam Wong:

And so they're the things that we should be giving priority to. And so that's kind of almost like, you know, first order of business, but then equally, if we managed to do that. We have to kind of grow the capability of the team to deliver on a fund stream and so on. And so I also think about how do we grow the team and invest in the team?

Sam Wong:

Cause that's really high leverage, right? If, if, if people can grow and learn, that's awesome leverage for me. I don't know if that's what you had in mind, Maxine, based on what I've maybe said before. Maybe I need a reminder.

Maxine Minter:

I know. I think there's a way that you think about it, I find really inspiring. Like obviously.

Maxine Minter:

I am currently in a moment of trying to work out my own leverage model, right? Building a fund. And I, I think it is a really, it's inspiring to hear the way that you think about like, okay, a one to many always, you know, you will opt for that. So that it has that ability to kind of influence or encourage a wider.

Maxine Minter:

Group of people, or, you know, even the insight to focus on your team building as opposed to necessarily individual optimization. So that that scales with you over time. I, I suspect for a lot of our folks listening is that they haven't necessarily thought about that before. And now an angel investing say, or if they're thinking about funding building.

Maxine Minter:

One thing I did want to double click on because I think it's relevant for this community is I haven't heard a lot of the Australian investing ecosystem. Kind of truly understand what it's like to build Fund 1, then Fund 2, and Fund 3, and the realities of being a fund manager in that regard. Really? I hear a lot of founders kind of assume, yeah.

Maxine Minter:

Totally. I hear a lot of founders kind of assume that, like, once you have a fund, that's it.

Sam Wong:

It's

Cheryl Mack:

easy. But

Sam Wong:

ATM, it just never runs out.

Maxine Minter:

Yeah, right. Yeah. You're like, oh, to the races, you just build a whole bunch of funds. But I think the

Sam Wong:

stats do say that, like,

Cheryl Mack:

90 percent of funds don't get passed. What fun to and aren't able to raise fun three like even in Australia, we've seen that play out.

Cheryl Mack:

So like, it would be interesting to hear what are the things that you think about in order to get to that fun

Sam Wong:

three stage. Yeah. So, and I think. It will probably depend manager by manager and your LPs and who you're hoping will be your LPs for, for each of those stages, but as kind of rough rules of thumb, like, you know, your fund one obviously has to be in positive, uh, TVPI territory and at least benchmarking well, like top quartile globally, or you need a really good story about why it's not.

Sam Wong:

And then your LPs obviously have to agree with that, um, hypothesis and, and be willing to kind of back it back you, uh, into another fund. But I would say as well, like, especially as you start going to fund three, you're probably, if you haven't already starting to take institutional money. And so institutional investors, depending on.

Sam Wong:

I mean, there's all sorts of colors and flavors of institutional investor, but they're often looking for things beyond just your historical performance. Is this, you know, is this team, uh, capable of, you know, deploying another X dollars into Y number of portfolio companies? Is the capacity there like, you know, can they, can they scale themselves as this partnership or, or whatever functional and, and so on.

Sam Wong:

And the market around the manager has probably changed, right? So there's an assessment of like, where did, where are they in the market relative to the other VC funds? And you've got to have a really good story around differentiation by fund two or three at least. And so, and then at least we personally believe that a lot of it is also just relationship management with LPs.

Sam Wong:

Like, don't just pick up the phone when you need money. Like, you know, it's almost like a. Daily habit of make sure your investment memos go out every single time you do an investment, make them good, like, um, and really kind of keeping in mind, like, what does your customer want from you? Some of them want co invest, some of them just want, um, insights on, on the market, you know?

Sam Wong:

So we've done a deep dive into AI. Don't keep that a secret. Um, you know, let your LPs know, Hey, we've done this big deep dive. Do you want us to come and present to your IC? Like think about all the ways that your LP, like. LPs are not just necessarily investing for returns. They're investing for a lot of different reasons and making sure you really understand why they've invested in you, what they need to see from you to continue investing and look, sometimes it's not going to be in your control.

Sam Wong:

Right. Denominator effect was a very big thing, you know, um, what's less now, but like. particularly last year, where a lot of allocators due to the fall in public market values were just simply way too overweight, venture capital and private equity. And there was nothing you could have done. You wouldn't have shown them maybe some of the best results ever, but there was.

Sam Wong:

They just didn't have budget to allocate to, to the asset class. And so you as a manager have to be really aware about all these different factors and building a strategy well ahead of time, years ahead of time, before you go to raise that next fund. To give yourself the best chance of having money to deploy and raising another fund.

Sam Wong:

And look often by funds free, it'll, it'll, you know, team is a big one, right? You can usually get away with fun one, maybe fun too, with kind of like the OG team. But by Funds Free, your portfolio is too big and you need to scale yourself. And that's a big risk point. And it's very easy, like, it's almost the easiest time for an LP to back out, right?

Sam Wong:

There's like a personnel change or personnel risk. And so kind of preparing for that well ahead of time, I think is really essential.

Maxine Minter:

Yeah, I think it's so interesting. I'm really interested to hear what people respond to this particular portion, because I don't think that that information is particularly public, especially a bunch that across the ecosystem of angel investors who aspire to be fund managers.

Maxine Minter:

I mean, one of the biggest adjustments is thinking in those very long terms and thinking of it like a business, right? You have customers, you have a go to market strategy, you have to be responsive to the market around you. It's very similar to building a business, not the same. Um, but very similar to building a business, which I think is not obvious to a lot of folks who are relatively new to the

Sam Wong:

ecosystem.

Sam Wong:

Yeah. And I would say sometimes like the jump from fund one to, I mean, depending on the size of fund as well, like fund one to fund two or fund three is kind of like. Being a freemium open source dev tool, and then jumping straight into like enterprise sales with the government, you know, it's like the sort of internal, uh, change that has to happen is really.

Sam Wong:

Really meaningful. Yeah, I'm not quite sure how to do that, to be honest. You're like, well, we figured it out. I think

Cheryl Mack:

it's also interesting from a point of view of like, there are a lot of angel investors out there who would aspire to be fund managers at some point. But that change of going from deploying your own money to then deploying someone else's money, like you can stop deploying your money anytime you want.

Cheryl Mack:

You run out of cash. A new mortgage. Yeah. Cool. You're done. Whereas when you start a fund, that's like a 10 year commitment to deploy someone else's money. And I think that's, that's probably not thought of as much. Like I hear a lot of people think, Oh yeah, I'd love to raise a fund one day. So I think this, this segment is very useful for anyone who is thinking about potentially raising a fund at some point, including

Maxine Minter:

myself.

Maxine Minter:

Yeah. I mean, it is a very, very long term commitment. Speaking of long term, I feel like, as Cheryl mentioned, you know, you spearheaded identifying the opportunity in New Zealand. And I have had a few kind of interactions in New Zealand. We obviously share a portfolio company who are amazing and I have just been blown away by the caliber of founders coming out of the ecosystem.

Maxine Minter:

I would love to learn from you kind of how did you develop that thesis that New Zealand was. It's an exciting space to explore. And what was your journey to kind of building there? And also when then moving

Sam Wong:

there, yeah, it was just, as you say, it was pure observation. So, uh, like most of the fund managers in Australia, we only raised these ESV CLP fund vehicles, which really restrict your ability to invest in foreign companies to like effectively around 10 percent of the committed capital of the fund.

Sam Wong:

And for that reason, our mandate was like very clearly just focused on Australian founders, because even with that mandate, many of them are building in the U S or building in the UK. And that puts them in the foreign bucket, so to speak for the ESVCLP regime. So we really didn't focus on New Zealand at all, but Nikki went rogue.

Sam Wong:

Not the first time I've heard that. And he developed this thesis around MPS and found a Kiwi company called Ask Nicely. And we did have this sort of like little foreign sleeve and we're like, okay, let's, let's do this one investment. So we have really strong conviction around it. And so we did that investment.

Sam Wong:

And basically off the back of that, we started getting such a snowball of. High quality deal flow, as you say, Maxine, really high quality founders that by early 2019 one in three founders that any of the four partners were meeting were Kiwi, which if you think about it really doesn't make sense because we didn't market to the region.

Sam Wong:

And, uh, New Zealand is like a fifth of the population of Australia and we didn't have any money to deploy there. I was just kind of like scratching my head going, what are we going to do here? Are we going to put a sign on the door saying no Kiwis allowed or are we going to look at this and work out what the hell is going on?

Sam Wong:

Because this is a very inefficient market if Kiwis that we think are pretty good are jumping on place to pitch us when we can't invest and kind of, it didn't really take very long before. I really grew in conviction that there was a sort of Australia 2013 esque opportunity where you had on the one hand, a real scarcity of quality options for capital or any capital in some cases that could do, say, a two to four mil round.

Sam Wong:

And on the other hand, actually really high quality talent. Some or a lot of which had been incubated at places like Xero or Rocket Lab Vend, uh, and, you know, you had these operators or people, you know, who'd have been around those, those stories kind of, uh, growing in ambition and wanting to do their own thing.

Sam Wong:

That asymmetry of. Capital supply to found a talent is what creates alpha opportunities, right? And you just don't get many of those in a venture lifetime. So I was just like, guys, what are we going to do? Like, you, you, you're just going to let this, this pass us by. Everyone was like, great, do it. You're like, wait, did I put my hand up?

Sam Wong:

Well, at the time I was five months pregnant, so it was definitely not in my life plan to move to a new country, uh, and raise a new fund to start a new strategy, but I just felt Um, real conviction that even a year from then would be too late. I think timing is everything in life and in investment lives in particular.

Sam Wong:

And it wasn't ideal, but I was like, I just think we've got to do this. And so, yeah. That's why I moved over when I, when I did, it was sort of five months after my, my daughter was born. And we started raising the funds sort of, uh, the back end of 2019 and yeah. And then I think we did the first close maybe March, April, 2020 and got to work.

Sam Wong:

And that was, yeah, that was that. That's incredible. That is so interesting and amazing. Like, yeah. And you're right

Cheryl Mack:

though, because there aren't really very many opportunities where we get it. Yeah. to find true alpha as investors. So being able to identify that early and, and just be like, Hey, we, we got to act on this, I think is the coolest part of

Sam Wong:

that.

Sam Wong:

I think what was so lucky about kind of how I came into Blackbird. So, so when I joined Blackbird, it was in this role of head of ops, which was Almost chief of staff esque, right? It was kind of a bit of everything. There were only three of us, so everyone was doing a bit of everything. Yeah. But one of the things I had to do every quarter was prepare the, um, net asset statements of the, the valuation statements for the fund every quarter.

Sam Wong:

And when I joined. It was like nothing special. Fund one was like a one times, you know, TPPI or total value to pay in a net multiple fund. And like every quarter, it was just like markup, markup, markup, markup. And by the time 2019 rolled around, I think that fund was a 15 times fund, something like that, which is just extraordinary.

Sam Wong:

Right. And. Yes, Canva was a big part of it, but it wasn't the only part of it. There were a good four companies that were driving a performance that would have put us at the top of the top quartile, even without Canva. That I think is what market asymmetry gives you. You have an unfair or disproportionate access to quality deals that doesn't exist in efficient markets, frankly.

Sam Wong:

Right. And that opportunity doesn't persist for very long because humans are very good at identifying opportunities to make money. And someone at some point was going to go, Hey, New Zealand seems like a good idea. Or something was going to change there and has certainly. Has it? Yeah. It really has. It's a really different scene.

Sam Wong:

It's still, I would say undercapitalized relative to the Australian market, but I'm not complaining about that. No, I think it actually would if there was, there was more activity in New Zealand, but I think your opportunity, particularly as a fund manager. To build a brand, I think it has, it's, it's helped so much when you get this opportunity to be a cup of water in the desert or, or to kind of, you know what I mean, uh, be a challenger brand or be, you know, and, um, and if you do a good job of that, you have the opportunity to compound, uh, that brand reputation as well as capital hopefully over time.

Sam Wong:

And that was kind of a lesson. I don't think I could have learned any other way than kind of joining Blackbird when I did doing grunty jobs, like the nav statements, which I did. And like, just kind of like letting the cogs turn around. Like what is actually driving this? Cause sometimes it's, it's too simplistic to say, Oh, you know, Canva and Zoox were just great companies.

Sam Wong:

It's like, well, yeah, great companies. And I think the answer is because there's just more competition for those great companies.

Maxine Minter:

Absolutely. It's one of the things that blows me away getting to be in the U. S. market versus Australian market. And I can imagine it's similar New Zealand to Australia, which is like the U.

Maxine Minter:

S. market is so competed, right? It is like it, those great companies are. Almost impossible to find because there's huge pools of resources chasing them, you know, fostering those relationships for like decades before they happen. And so like, it's amazing to see to kind of step into the Australian market and just see where we're at just because of the depth of ecosystem and the maturity of the ecosystem.

Maxine Minter:

And I imagine that's kind of a very similar thing. I also, the other thing that this reminds me of is, it sounds to me like you got to watch firsthand super linear results. At Blackbird in like 2013 to 2019, meaning like the more successful you become, the more opportunity accrues to you in an expon way because of the, you are the biggest brand in the Australian market.

Maxine Minter:

You are, you know, you get to see that amazing deal flow, and that's just super cool that you're getting to see that

Sam Wong:

it's the halo effect that people talk about, right? A hundred

Maxine Minter:

percent. Yeah. Yeah. It's so impactful. So what have you noticed, um, the biggest differences between the Australian and New Zealand ecosystem from an investing perspective, or do they feel pretty

Sam Wong:

similar?

Sam Wong:

I think from an investing perspective, I mean, look, it's a much smaller overall market. There are fewer players. I think it's gotten smaller still in the last year or so. I would say New Zealand has, particularly when I arrived, it actually had probably a more active angel, you know, capital funding system, but.

Sam Wong:

It was a different kind of angel, like there may not have been a technology founder or whatever, but it was a very active angel investment, you know, scene, but non institutional so, so few people could do say a million dollar lead check. I think that's changed because it's still really only like three to four firms whose mandate overlaps with a company's ask at any given time, which is not really much of a choice, right?

Sam Wong:

Change. Yeah. If you're a founder. So I would say it's, you know, it's still early in the development phase. You might say similar to like, say 2016 in Australia or something like that. And on the sort of. Other maybe anecdotal things I can say about the companies and so on. I'd say the vertical SaaS is really strong in New Zealand.

Sam Wong:

Much stronger, I think, than what I see in Australia. I think Australian startups are so good at horizontal. And I think that comes maybe from the DNA of an Atlassian or a Canva where, you know, you have, you have these applications that have broad usage across teams and organization types. Whereas maybe through.

Sam Wong:

The DNA of zero, for example, you know, key was a very good at kind of identifying, okay. You know, this is a pain point for this particular industry, for this ICP, we go after that, and then we go vertically up and down and we build kind of like all the tooling for that industry kind of thing. So I see really high quality vertical SAS and.

Sam Wong:

I would say the deep tech is great here as well. Again, probably due to the Rocket Lab, Lanza Tech, Mafia type of, I mean, I think we've probably invested in three ish Rocket Lab alumni. And I think the kind of, if you go and work at Rocket Lab and then you want to go start your own startup, you're made of a certain kind of stuff.

Sam Wong:

I think, uh, that, uh, you, It makes you probably uniquely equipped to, to build an early stage startup. And I'd say the other really interesting thing that has made me think a lot about actually parenting stuff has been what a very large proportion of the founders of farm kids, like they grew up on farms, they didn't have TVs, you know, very free range kind of upbringings.

Sam Wong:

And then they kind of go study mechanical engineering. at Auckland University or something like that. And I think, again, maybe there's something in that, you know, if you grow up on a farm mucking around with a lot of freedom, you're building things, you're being creative, you're problem solving, you have a lot of autonomy.

Sam Wong:

You aren't afraid of hard work. You aren't afraid of, uh, grazing your knees a little bit in life. And these are kind of pretty key attributes, I suppose, in, in founders. So that's been a very kind of interesting contrast, I suppose, to the founders we usually meet right in Sydney or Melbourne.

Maxine Minter:

Yeah, that's so interesting.

Maxine Minter:

It reminds me of Dan Gavel. We had him on the podcast when he grew up on a farm as well, and he was saying his first introduction to risk was the decision to either direct with a brown snake or not, and he made the wrong choice. Um, but I think that's so true. I know we're almost at time. So we'd love to ask you the question we ask all of the folks that join us on the pod, which is.

Maxine Minter:

What is the biggest Big Kahuna's moment you've ever had? A moment that you felt really brave.

Sam Wong:

I, I think there's probably been a few moments that other people have thought, Oh, that's really brave. I hadn't thought that they were very brave. Like I thought leaving law was not that brave. Um, but I think other people thought I'd taken a big risk, but I would say, I think starting New Zealand has probably been the biggest, big honours thing because I felt it at the time too.

Sam Wong:

I, I had, um, I had several moments where I sort of looked to my partner Ben and I was like, what am I doing? Like I, I made partner last year. And I think we just raised the biggest fund in Australia and I just started kind of like working out what the hell I was doing and, you know, and I was like, why am I doing this?

Sam Wong:

Why am I, am I crazy to chuck this all away and start from scratch by myself in this place that I'm not from with no help with, you know, a baby. With a five month old. Yeah. And so I guess I, I would say that was the one where I, I, I felt, Oh, I've just

Cheryl Mack:

got to dig deep here and be brave. Yeah, I love it. 100%.

Cheryl Mack:

Definitely a big brave moment.

Maxine Minter:

Dang, doing that with a five month old as well. Like all of that plus a five month old,

Sam Wong:

hectic. To be fair, it was my first child. I didn't know. What I was in for, I mean, I'd already raised the fund by then, so it was too late. I couldn't back out. It was the decision to kind of, yeah, like pick up and move and pick up and move when I was pregnant and all the rest of it.

Sam Wong:

That was the one where I was like, okay, point of no return. And I'm so glad I did. Like, I think it's been absolutely the best thing for my career, even my family, like all of that. But it did feel very risky at the time.

Maxine Minter:

Amazing. From the outside, it looks extremely brave. Yeah. It's really wonderful to watch you just killing it over there in New

Sam Wong:

Zealand.

Sam Wong:

We'll see. Give me five to ten years. Well, thank

Cheryl Mack:

you so much for coming on, Sam. I, as always, we've learned so much. Loved everything that you've shared today and really appreciate

Sam Wong:

you coming on. This was the best. No, it was a super great chat. I'm, I'm a big admirer of both of yours. And I just, I love to see more people kind of heading out there, doing their own thing, building their platforms.

Sam Wong:

And I think if we all do our little bit, like we, like we all here are, we'll have an ecosystem we're really proud of, um, a few years from now. A hundred percent.

Maxine Minter:

One hundred percent. Cool. To a wonderful ecosystem. Thanks, Sam. Thanks, Sam. See ya.