Replay — Getting Smart on a New Market, Parts 1 & 2 (Charles Hudson)

The Full Ratchet (TFR): Venture Capital and Startup Investing Demystified

On this special replay, Charles Hudson of Precursor Ventures joins Nick to discuss Getting Smart on a New Market. In this episode we cover:

• What Charles’ experience at SoftTech was like and how he made the transition to founding Precursor.
• What his continuing role as a Venture Partner at SoftTech entails.
• How Charles decides to study a new, emerging market and some of the markets that he’s analyzed over the years.
• The three components of his approach to getting smart on a new area.
• How important timing is and how he considers if the timing is right for a new area.
• If he assesses markets vertically and looks for the level within the supply chain stack to see where a company is playing and which level within the chain is going to exert the most control over the market.
• How he breaks down market structure and the critical components therein.
• The importance of the degree of homogeneity of the customer base within a target market.
• How he thinks about companies disrupting existing markets and those creating brand new markets.
• We discuss how there’s always a good reason to say no to startups and, more importantly, the key, recurring reasons that come up that cause him to say yes.
• How do you look at companies addressing industries where the incumbent product offerings are free. Businesses like Slack that were replacing free options
• Fresh Eyes… You’ve written about how you don’t look at decks before the first meeting w/ an entrepreneur. Can you touch on the key reasons why you take meetings without reviewing the deck?
• If you are evaluating a startup that is pre-traction – what do you look for and why?
• In the spirit of continuous improvement… What are your thoughts on how one can learn and improve once they have a job in VC?
• What startup investor has inspired and influenced you most and why?