Is Capitalism Failing? With Seth Levine from Foundry Venture Capital

Anthony Codispoti (00:00)
Welcome to another edition of the Inspired Stories podcast, where leaders share their experiences so we can learn from their successes and be inspired by how they’ve overcome adversity. My name is Anthony Codus-Bode and today’s guest is Seth Levine. He is a partner at Foundry, a Boulder-based venture capital firm that invests in early stage technology and supports founders through a strong network-driven approach.

Foundry is known for its give first philosophy and helps entrepreneurs build lasting businesses in a supportive community. Over the years, he has advised venture funds worldwide and guided many entrepreneurs through growth and change. Seth also co-founded GoodBread, a platform that aims to expand financial access for small businesses. He co-founded Pledge 1%, a global network of companies that have pledged to give back to their local communities.

and Seth has co-authored two books, The New Builders, which discusses the empowerment of women and people of color in the world of business, and his latest book, Capital Evolution, which explores how businesses, governments, and individuals can work together to create an economy that works for everyone.

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One recent client was able to increase net profits by $900 per employee per year. Results vary for each company and some organizations may not be eligible. To find out if your company qualifies, contact us today at addbackbenefits.com. All right, back to our guest today, Seth Levine. Thanks for making the time to share your story today.

Seth Levine (02:05)
Anthony, it’s a pleasure to be here. Thank you for having me.

Anthony Codispoti (02:08)
So Seth, where did you first get your start in the entrepreneurial world? Did you have a lemonade stand? Were you selling comic books?

Seth Levine (02:12)
Yeah.

I had a SaaS business actually back in the day. ⁓ It was a shovel. The first S was shoveling, shoveling as a service. I grew up outside of Boston and to make a little money, Snow’s in Boston, to make a little money, I used to go around the neighborhood. I was probably, it was in Newton, so we moved there when I was in fourth grade. So probably call it fifth, sixth, seventh, eighth grade, somewhere in there was kind of when I was working on this.

offered to shovel people’s walks for, you five bucks or whatever, a driveway for 10 bucks kind of thing. This is back in the 80s. And I had a lot of sort of older clients, elderly clients, and it occurred to me that it was kind of a pain to walk around house to house and ask if they wanted it on any given snow day. And so I came up with this idea that at the beginning of the winter, I would walk around and I would offer for $20 a month.

to shovel their walks or driveways as many times as it snowed. ⁓ Unlimited, exactly. So ⁓ a subscription business, shoveling has a service. And I ended up, I got a decent number of clients, enough that I actually had a couple friends that I would pay, of course I was paying them on an hourly basis, right? Or a per walk basis, not on a monthly basis. ⁓

Anthony Codispoti (03:18)
Unlimited.

Seth Levine (03:39)
And most winter I did pretty well, right? mean, there was obviously it’s just my time. know, winters where it snowed or months where it snowed three or four times, you know, I was sort of begrudgingly walking out the fourth time and shoveling. but anyway, that’s kind of how I got my start in, in entrepreneurship.

Anthony Codispoti (03:54)
So was sales just like natural easy to you?

Seth Levine (03:57)
Yeah, I mean, I like people. I’m a natural extrovert. I really, and by the way, I also felt like it was something that was kind of offering them a bit of peace of mind. Right. I mean, one of the things, and I think maybe the idea came because I would, sometimes I would end up at someone’s house later in the day, just because, you know, I just, I’d start walking neighbor to neighbor. Right. And by the time I got to someone’s house, maybe a bunch of people said yes. And I was shoveling for hours. ⁓ and people would say to me, Hey, I wasn’t sure if you were going to come today. ⁓

because it would be later in the afternoon. And that’s where the idea came to me was like, well, actually, why don’t I give them an assurance that I will do it? And by doing that, I would do those houses first. That was part of my pitch was like, look, I’m gonna do the houses that sign up like this, I’m gonna do first thing in the morning, and then I’ll keep going around the rest of the day and try to make more money. And obviously you’re less likely to get clients later in the day, because people have already figured it out. And either someone else, some other kid has showed up there, or more likely they’ve just shoveled.

So anyway, that was kind of how it all came together, but it was very natural.

Anthony Codispoti (05:00)
What you’re describing, Seth, is

pretty clever, especially for somebody in elementary school, junior high. Did you get some coaching on this?

Seth Levine (05:06)
Yeah, not, not bad for like

fifth or sixth grader. You know, it’s funny. I was talking to someone about this the other day. I hadn’t totally put this together, but my, in particular, my dad’s father was incredibly entrepreneurial. He grew up in Denver, which is, you know, I live in Colorado. He, ⁓ he was one of 11 children. He dropped out of school. I think it might’ve even been middle school, during the great depression and he never went back. So he never.

never even graduated from high school. And he ended up having this like very kind of middle-class life. was a salesman ⁓ and he sold cars, he sold check cashing, check writing machines. ⁓ He for a while had a men’s clothing store that he started. was unfortunate, it wasn’t successful, but ⁓ you know, and he kind of scraped together this really sort of very good, very nice middle-class life. And we really, my family is sort of the epitome of the…

American dream, right? So, my grandfather didn’t graduate from high school, let alone college. My grandmother, by the way, actually back in the 30s, did graduate from college when it was much more unusual for women to go to college. She went to Colorado Women’s College. And my dad has a PhD from Harvard, right? So like in one generation, my dad goes to Cal and then Harvard. ⁓ And his dad hadn’t graduated from high school. And of course his mom was sort of an early pioneer.

Anthony Codispoti (06:31)
I love that that really is

the classic American dream. I you know, my dad came over to the country when he was just eight years old. His parents didn’t have anything better than a grade school education. He graduated from college graduated from dental schools gone on to start you know, many successful businesses, you know, kind of on the shoulders of giants like if if if the earlier generation say it again, Seth.

Seth Levine (06:33)
Yeah.

Yeah. Well, we both come at it naturally.

We both come at it naturally, right?

Anthony Codispoti (06:55)
Yeah. And, you know, without the earlier generation sort of having, you know, made the sacrifices and the strides for us, you know, the path was paved. ⁓ So, yeah, I’ve got a lot of gratitude as I hear your story and I think about, you know, ⁓ similar connection to mine. And I think that you have as well the way you’re talking.

Seth Levine (07:04)
Yeah.

Absolutely. I, my grandfather and I were very close. ⁓ and, sort of all growing up, we spent, spent all my summers in Colorado. It’s why I decided to move here. And, but after I moved here, my grandfather and I, was this wonderful Jewish deli down in Denver called Zadies. And, ⁓ he and I would have breakfast together at least two days, sometimes three days a week. we would just meet there. He lived nearby and, and this is, you know, I was younger. I didn’t have kids, stuff like that, but.

And that was like one of the great gifts of my life was the decision to move to Colorado and being able to spend that much time with my grandfather. Yeah.

Anthony Codispoti (07:51)
That’s really cool. Okay, so

let’s fast forward a whole bunch. How did you meet your partners at Foundry? Because this has turned into something pretty incredible.

Seth Levine (08:00)
Yeah. So it’s a two-step story, Anthony. The first is I met Brad. I was working for a data comms company sort of through the internet bubble and the bubble burst. I, eventually they decided to focus on a portion of their business and they had me run the rest of the business and sell it. was a couple of different business lines, which was an incredible experience. I was in my twenties. I was running a $55 million P and L had a couple hundred people working.

in my organization, I sold them off. I could see that the sales were happening. That company had asked me to stay, but I knew I didn’t want to stay. And so I had a summer where I had sold two thirds of the businesses that I was supposed to sell, and I had one sale pending. I didn’t have a lot to do, frankly. This is the summer of 2001, so bubbles already burst. And I was taking long lunches, and I had a lot of friends who were about to get let go from Cisco and a couple of other places. We’d meet and play basketball and stuff like that.

just waiting for this deal to get done. And I had to stay through the deal because I had some deal bonuses that were tied to that. But I kind of looked around and I was like, all right, I know I don’t want to stay. What do I want to do? And I thought, you I had a couple of offers to do corporate development or be like a GM of something. And I was like, I have a lot of friends that have tried. Early in my career, I was an investment banker and I had some friends from banking who had gone into either venture or private equity. I don’t know that I even totally understood the difference at the time. And I was like,

That sounds kind of fun. Again, I was young, youngish and I was single at the time and I didn’t have kids. So I was like, yeah, now might be the time to do that. So I just networked into a bunch of people. ⁓ Eventually someone introduced me to Brad. Brad was like crazy busy back then. It truly like we got this introduction and he said, I’d love to sit down with you. And I got an appointment on his calendar three months later. Right. So.

⁓ And so eventually I track up, there’s sort of a fun side story about like, what do wear when you’re going to meet Brad Feld for something that feels like a job interview? I was like,

Anthony Codispoti (09:57)
Was Bradfeld a person of recognition at that point?

Seth Levine (10:00)
Yeah, everyone in Colorado, turns out they’re not, there are just aren’t that many VCs in Colorado. And I was, I naively thought, well, I’ll just meet them all and someone will offer me a job. ⁓ which was a crazy thing now that I understand how it actually works. But, ⁓ but yeah, no, he was very well, but well known, but also known for being a little eccentric, right? So I’m like, he will probably not even have socks or shoes on, but it’s kind of an interview. Like I just wasn’t wired to show up in jeans and a hoodie. ⁓

And so I remember that they had this like crazy throne in the, had this like incubator thing that was sort of between Denver and Boulder. They had this big throne with all these ornate decorations on it. So he sits me in the throne and he’s like, so why are you up here? And we had this kind of amusing conversation. But anyway, we eventually, it turns out they were trying to, they were hiring for an associate. And I ended up going through that process. Interesting story about Brad. We get to the end of the process. I’m one of two finalists.

Brad wants to hire the other guy. And the rest of the team said, no, we want, we think Seth’s the right guy. And Brad, because he’s Brad, said, okay, if you, you know, it like four five other people, you guys all think Seth is the right guy, we’ll hire Seth. And that’s how close I came to not having the life that I have, right? Cause everything changed for me when I met Brad and started working for Brad and then eventually with Brad. ⁓ And so that was, that was how I got my start at what was SoftBank Venture Capital and eventually became

Anthony Codispoti (11:15)
Okay.

Seth Levine (11:26)
Mobius venture capital.

Anthony Codispoti (11:28)
Got it. And so at what point did you go from working for Brad to working with Brad?

Seth Levine (11:33)
Yeah. So, um, I joined, joined SoftBank on September 7th, 2001. So it went straight into September 11th, right? Four days later, which just meant it meant we couldn’t travel. was, it was, it was a really, we already knew that the sort of venture bubble had burst, but it was worse than I sort of even thought it was going to be. Um, and I saw, I joined to be an associate for two years. Um, that turned into three years. Then they promoted me to this like super junior partner thing.

And that’s importantly where I met Ryan and Jason, Ryan McIntyre, Jason Mendelson, who became sort of the other half of the Foundry partnership. But in 2005, then was then called, they had then renamed it to Mobius. They tried to go raise another fund. And I actually sat down with Brad at some point, it probably later in that year.

⁓ And said, Hey Brad, I’m not quitting today, but I’m not going to stay at Mobius. would, at that point I was married. We’d had our first kid. I was still, and I was a super junior partner. Like to call me a partner was not even really a fair, a fair description of it. And I was going to get to do like one or two deals, maybe in that first fund. And I was like, this, this just isn’t working for me. ⁓ and Brad said, Hey, I don’t actually think we’re going to be able to raise this fund. Been thinking about maybe doing something, you know, on my own. I would love to do it with you.

And that we started talking about, I don’t know if he had already talked to Jason and Ryan about it. I’m not sure that the exact sequence, it’s sort of gotten blurred in the history. But ultimately he said, hey, we’re going to talk to Jason and Ryan about this. And they ended up moving out in kind of mid 2006. And we kind of figured out what eventually became Foundry, started raising the money in 2007, and then eventually closed the fund towards the end of that year. And it ended up being a great time to be an investor.

We had a pile of capital through the GFC and that was a really good time to start businesses.

Anthony Codispoti (13:31)
So for somebody who’s never heard of Foundry before, break it down for him. What is it?

Seth Levine (13:35)
Yeah. So Foundry is a pretty classic venture capital firm. ⁓ We were a national investor, but based out of Boulder, Colorado. ⁓ We’ve now over the years, we started in 2006 essentially, and we finished our first fundraise in 2007. So depending on how you count it, we’re in close to 20 years in. We’ve raised about $4 billion. Yeah, ⁓ it’s a big, big pile of money. In 2016, we decided to expand our work.

We had been investing personally in other venture funds, mostly funds from our friends, but a pretty interesting group of managers. And we thought that that would be interesting to institutionalize. had not, LPs are kind of a different animal than GPs. And we thought it would be interesting to try to be an LP that was a GP, right? So we had this experience running a fund ⁓ and we’d created this fund of funds. And that’s really when our assets under management really ballooned. mean, all of our

Anthony Codispoti (14:31)
Sorry, explain that

for me, Seth. An LP that is a GP.

Seth Levine (14:33)
Yeah, yeah.

So the people that are running the venture funds are very different than the people that allocate money to venture funds. So the limited partners, right, the fund to funds, the endowments, pensions, things like that, the people that operate those piles of capital and invest in venture, just have a different, I tell people, tell GPs this all the time, they have a very different job, they’re asset allocators. And that is quite different in sort of training and mentality.

from someone who’s actually in the venture business making direct investments into portfolio companies. And we recognized we needed a little bit of understanding of both of those worlds. Obviously, we were partners at a venture firm, so we knew how that world worked. But we ended up bringing in our largest limited partner, our largest investor in Foundry, guy who built the University of Texas Investment Management Companies, so basically the Texas College and University Systems Retirement Plan. ⁓

their private markets and specifically emerging managers market portfolio, a guy named Lindell Ekman. So we brought him into Foundry and in 2016 raised capital to basically be a fund that we didn’t call it a fund of funds, but essentially that’s what we were doing. to become a fund of funds. So now Foundry invest in other venture funds. We’ve got about 50 give or take venture funds that we’ve invested in as well as directly into companies.

And they kind of feed each other, right? We learn about new managers through our work as an investor. We can evaluate them better in our minds as an investor. And ⁓ we often co-invest with them. typically invest in funds that invest earlier than we do. So we get a chance to see a few thousand companies and we pick the ones that we think are most interesting to partner on.

Anthony Codispoti (16:24)
And what is it you’re looking for? Is it all tech related? What are the check boxes that either the fund or the company directly has to satisfy for you?

Seth Levine (16:33)
Yeah, it’s all tech related. These days, that’s a pretty broad category. I would say we invest in what we call themes. We write about it on the website. I won’t go through all of them here, but ⁓ areas that have been very successful for us in particular are ⁓ marketplace businesses. We’ve invested in a number of very well-known marketplaces, SeatGeek, Rover, the dog-sitting platform, bunch of others.

⁓ So that’s been a popular area for us. We like what we call glue, which is technologies that ⁓ other technologists would buy. So intermediary technologies. ⁓ And then we also ⁓ have had a lot of success in, I’ll call them hardware companies. We really think of them as ⁓ bits surrounded by atoms. So usually there’s a heavy software component. ⁓ Examples of that would be Fitbit that I think everyone has heard of at this point.

⁓ But also something like whoop, let’s say or even maker bot, which is a one of the early 3D printing companies. those are areas that’s not exclusively. I mean, I describe everything we do, but those are some areas that we tend to lean in on.

Anthony Codispoti (17:41)
And when is it in the life cycle of the company that you’re traditionally coming in?

Seth Levine (17:45)
Typically, it’s series A for us. and the definition of that has changed over time. So it used to be maybe a little bit earlier. Now it’s sort of post-product market fit. Typically, a company has, let’s say, at least three to $5 million worth of revenue. So there’s some customers, there are numbers to crunch and to do some due diligence. Occasionally, we’ll write an earlier check and occasionally we’ll write a later check, right? With sometimes we’ve done a few deals where we’ve written, you know, 15, $20 million checks.

⁓ into companies that are a bit later stage. But for us still have venture risk. So when I say later stage, I don’t mean pre IPO round where there are, you know, 10 or $20 billion valuation. mean, maybe a few hundred million dollar valuation up to call it $500 million valuation. They’ve called series C, series D. Again, the numbers kind of are the letters shift around a bit, but giving try to give people a flavor.

Anthony Codispoti (18:31)
Yeah.

So where you guys come in in the lifecycle, then what are you traditionally seeing as like a success rate? Right? The earlier that you get involved, the more failures that you’re going to have. The later you get involved, you know, the more successes that you’re going to have. You guys are still getting in pretty early.

Seth Levine (18:43)
Yeah.

pretty early and I’d say the success rate is, the success rate has moved up because we’ve gone a little later. So if I look at the first fund, about two thirds of that capital went to effectively zero. And that was a six X fund, right? It was a very successful fund. It was just highly, highly concentrated. Now we did more seed and series A in that fund. And again, what meant, what series A meant was earlier back, this is 2007 to 2010 essentially. And then as you go forward in fund life, our success rate has become

It’s gotten higher because we’ve mixed in assets that we invested in a little bit later, but it’s still probably 50-50. And it depends a little bit on what you define as success, right? mean, if success, we’ve done a much better job of getting our capital back or making a couple of times our capital on things that weren’t really working. ⁓ And we try to continue to expose ourselves to these outlier companies that, you know, in the case of Fitbit was multi hundreds of X.

return on an investment. We’ve got a handful of those that still exist in the later funds as well.

Anthony Codispoti (19:55)
When we had Brad Feld on the show some months ago, we talked quite a bit about the give first philosophy that he believes strongly in, you guys at Foundry believe strongly in. Can you share a story, an example of when this give first approach, maybe really had an impact on a founder or a fund relationship in a way that you didn’t expect?

Seth Levine (20:18)
Let me make it really personal because it’s had an incredible and profound impact on me and my life. It’s interesting, Anthony. was, ⁓ of course, I read Brad’s book. read an early copy and gave him some feedback. ⁓ And he mentioned something and then the book came out and he’s been doing, you know, podcasts and things like that. As you mentioned, he was on your show and he mentioned a book that I hadn’t read. It’s a Give and Take by Adam Grant. And I was reading

So I was, I read it. I didn’t, I don’t know why I missed it. I’ve read most of Adam’s, Adam’s works. ⁓ and about halfway through, I sent Brad a message and I said, this, this book is about you and, it’s really made me realize just this incredible gift that you’ve given me this philosophy of give first. And I asked him the question, like I, I, or I posed the question. I think I was maybe predisposed to this idea, but I don’t know that if I had not.

met you and we didn’t have the relationship we had that I really would have internalized it the way that I did. But I also acknowledged, and this is in the actual answer to your question, that Brad was this way with me, right? I learned the venture business because of Brad’s willingness to give to me. And when we started Foundry, very specifically, Brad was in a position, he was

by far the most well-known of the four of us. had a real track record. He’d been a partner at a venture firm for more than a decade at that point. And he could have easily said, we’re calling it Feldventures and I’m taking half the economics. And he very clearly said to us and the world, that’s not the kind of firm that I want to be a part of. I want us to be equal. And we set up a fund that in which we were equal. We owned Foundry equally.

We had slightly different carry in that first fund, but nowhere close to what Brad could have commanded. And that was incredibly impactful on me. It was incredibly impactful from a financial perspective for sure, but it was also impactful for me from a philosophical and an approach perspective. ⁓ I think that, mean, knowing Brad has changed my life, right? I mean, I think that’s true of a lot of people. I mean, it’s amazing how many people I’ve bumped into.

who say, my God, Brad gave me three minutes 10 years ago and it totally changed what I was thinking about and completely altered the trajectory of my life. And I’ve consistently tried to, I’ll never actually live up to that because Brad is at a different plane than I am, but I constantly try to emulate that. How do I provide value to people? I mean, he’s been so selfless about doing that. ⁓ So.

It’s affected me very directly. It’s affected me because it modeled behavior that I want to emulate and continue to strive to emulate. I’m, you know, I’m just really, mean, Brad’s one of my closest friends. So it’s funny to talk about it this way, but, and we’ve had this 20 plus year partnership. mean, he and I started working together and as I said in 2001, so we’re 25 years into our working relationship. And ⁓ it’s had a profound impact on my life.

Anthony Codispoti (23:26)
So when people hear give first philosophy, think they can mostly connect the dots on what that means. But let me see if I can encapsulate it in a way that accurately reflects the intention of it. It is, as it sounds, give first in a relationship. How can I help you, Seth? How can I help you, Brad? And there isn’t the immediate expectation for some kind of quid pro quo. I’m not expecting Seth or Brad to turn around and, you know,

give me a share in their company or whatever it is, there is an expectation that at some point, somewhere in the universe, that that karma is going to come back to me. And my ability to give, give, give, I might not get something back directly from Seth today, but maybe Seth makes an introduction to somebody that then is able to help me in a different way. Am I thinking about this correctly?

Seth Levine (24:20)
Yes, and that last piece is so important, Anthony, I’m glad that you have sort of grabbed that and have acknowledged it here because I think that’s a piece to give first that I think some people tend to skip over or not understand. And because of that, I think that there can be a tendency for people to feel like, give first is this extractive thing, right? You give, give, give, give, give, and you’re taking.

right, from an individual in favor of a community. ⁓ And there are people who sort of get sucked into that and feel like I’m never gonna get anything back or there’s this expectation that I never get anything back. And that’s not what Give First Means means. And I think that that last piece, as you accurately described it, is really important. It’s not that I don’t expect stuff to come back, it’s just that I don’t expect it to be a one-to-one relationship. And I don’t know the form in which it’s gonna come back.

But think it’s particularly important to say that because I think there are in particular, very specific communities of people who historically give a lot and don’t get anything back and where it’s expected that they just simply give of themselves. Right. I think we’ve we’ve in our society in particular have treated women with this lens. And I’ve had a couple of women specifically say to me, hey, I, I feel like this could be exploitative of me and my time. And it’s really important to say, no, no, no, no.

Anthony Codispoti (25:33)
How interesting.

Seth Levine (25:44)
If you feel like that’s happening, then you’re sort of giving too much and you’re not sort of requesting something back from the community. So I think it’s a really important point. was not sensitive to this until a friend of mine, she called me out on it and said, hey, this is what it sounds like to me. And that’s when I started personally using different language. don’t know, I’ve noticed Brad using this language as well. I know he used it when he talked to you.

And so I assume someone has talked to him a little bit about that as well. And it’s kind of changed the way he’s, I think he’s always thought about it this way. And we’ve already always thought about give first this way. But I think this has changed how he’s talked about

Anthony Codispoti (26:23)
So how does someone guard against giving too much and not receiving anything in return? Is that even the right question to ask? Okay.

Seth Levine (26:30)
Yeah, I think, I think so. I think it’s fair

to say, I don’t, I don’t advise people to keep a leisure and say, okay, well I’ve given, you know, 10 ducats and I’ve gotten six ducats back. And, and by the way, different people, I have, I am totally fine having an imbalance, right? I don’t, I’m not expecting to get the same things back from community. And I don’t really know how and in what form things come back to me. Right. And I think for me, a lot of stuff sort of happens in the background.

Anthony Codispoti (26:38)
You

Seth Levine (26:57)
I don’t know. I’m in the middle of a book launch. I’m seeing a lot of give back now, right? I had a, I’ve had a ton of people, the book, book actually launched yesterday, it was available yesterday. And I had a ton of people posting on social and, you know, telling people about it and buying books and showing up to the launch event and things like that. And for me, that was getting back from community and it felt very, I felt that very warmly. ⁓ but the way that I think you guard against it is that you, and each person, person needs to decide this individually, but you, need to be thoughtful about.

how and when and what time you’re given. ⁓ And I’ll tell a story later about sort of just a breakdown in my life around just too much to do. And part of that breakdown was I was not putting appropriate boundaries, in that case on my schedule. Anyone who wanted to get on my schedule was getting on. And I felt like that was part of give first. And I realized that there were other ways for me to provide back.

information in an email, pointing people, writing about certain topics and pointing people to my blog more, writing the books that I’ve been writing, for example, things like that, ⁓ that were a way for me to avoid these one-on-one meetings. And I needed to realize it was okay to say to people, hey, I don’t have time to meet with you face to face, right? But I’m happy to answer some questions over email or here’s what I think might be helpful to you.

And it took me a little bit to understand that. So that’s just one example from me personally, where I needed to put some limits on what I was giving because it just got to be too much.

Anthony Codispoti (28:28)
You made a comment before, Seth, about certain communities of people, I don’t know, being at greater risk for having, you know, give, give, give and not receive back. And you specifically pointed out women. I wonder if this ties into any of the motivation for co-authoring your first book, The New Builders. Can you talk about that?

Seth Levine (28:48)
Yeah, thanks for asking about that. really, you know, I love the venture books that are about people’s experiences and, and, know, company stories and things like that. And, it’s what I’m going to say is not to take away from those, but, ⁓ the, the two books that I’ve written are pretty different, right? There was a lot of research that went into them. It’s not really sort of stories of my life as a venture capitalist. Instead, they are, ⁓ stories about topics that I

care deeply about. Originally, I decided to write what became the New Builders because my co-author and I, she’s a business journalist. I’d known her for a few years before this. We love trading stories about ⁓ entrepreneurs doing interesting things, kind of out of the Main Street lens. It started with some international entrepreneurs because we met over entrepreneurs that were working in, actually in Palestine and in the West Bank specifically.

⁓ and so we were trading these stories and we thought, well, wouldn’t it be fun to write a book, kind of a lighthearted book actually about people that, you know, maybe are overlooked by mainstream media and we didn’t know the stories of them. And so that’s how it started. As we researched it, we realized actually two things. One is that, ⁓ the people starting businesses today, ⁓ we’re much more likely to be women and people of color and immigrants as they always have been. ⁓ and that, ⁓ they were, we were not doing a good job of connecting capital.

to these businesses, capital writ large, right? Not just venture, venture is like 1 % of companies. So it’s important, but it’s not, it’s a tiny number of businesses relative to what we’re talking about. And that became a much more urgent in our mind story to tell. And so we decided it was gonna be a more serious book than we had originally thought. And we started writing it up or researching it. And then as we started writing COVID hit and of course, businesses that were owned by

In particular, women and people of color were disproportionately affected by COVID in large part because they had lower cash reserves. So we really felt an urgency to get it out. And so the book is sort of a combination of research studies and statistics, but really punctuated by vignettes. We tell the stories of a bunch of entrepreneurs. Each chapter is about a trend and we tell the story of an entrepreneur that exemplifies that trend. And then we talk about the broader trend.

⁓ and it really became a sort of a passion project, right? Something that we just were, we felt so strongly about. I’m really proud of, I’m proud of both books. I’m very proud of the way that that, that book came out and frankly, the impact that it had, we, in particular, it got passed around on Capitol Hill quite a bit. And, and yeah, yeah. And it shaped, know specifically, cause we heard from some staffers that it actually shaped some of the pandemic, relief.

Anthony Codispoti (31:25)
is that right?

Seth Levine (31:34)
⁓ monies and, bills because it, they, forced them to think differently about the types of businesses that were actually impacted, by COVID.

Anthony Codispoti (31:43)
Can you say more specifically about how it influenced it?

Seth Levine (31:47)
I think specifically there were some of the initial COVID relief funds kind of skipped over small businesses, right? And they were really targeted towards kind of venture-backed companies. And again, was, mean, look, we at Foundry, our companies took advantage of those things. It saved a bunch of businesses. I have no problem with what the government did to try to bolster the innovation economy, but they were doing it by, at the expense of, or by ignoring.

⁓ businesses that were more Main Street businesses and sort of the second COVID relief act tried to fix that by channeling more money very directly to smaller businesses. Yeah, that’s great.

Anthony Codispoti (32:24)
That’s fascinating. Any idea

how it first got seated there in Capitol Hill?

Seth Levine (32:28)
I know that it was a staffer from Tim Cain’s office. I don’t know how they found it, Anthony. It’s really interesting. I mean, look, my hope for the new book is that something similar happens. The new book’s sort of, it’s about a broader topic, so I think it has sort of more broad applicability. But we’re doing an event in DC in a month or so, and I know that some staffers have already been kind of passing it around. So I hope that it has the same effect.

Anthony Codispoti (32:54)
That’s cool. Let’s talk about the new book, Perfect Segue, Capital Evolution. What was the inspiration to co-authoring this one?

Seth Levine (33:02)
I’m interested to describe this story because I think it will resonate with your listeners. The impetus for this book came from a dinner that I had with a portfolio company of mine in New York. It was a board meeting style dinner. There were a bunch of the management team, the CEO. I was the only out of town investor. So it got a little late and all the other investors left. It was just me, the CEO, and the rest of the management team. We started talking about

sort of the role of a company in society these days. And it was shortly after Dobbs, the abortion decision came down from the Supreme Court. And one of our other CEOs had written something on LinkedIn about it and had gotten feedback both from people who felt like he didn’t go far enough and people who felt like he went too far, both of whom worked for him, right? Not both people, both classes of people who worked for him. had a pretty big company. And the CEO was asking me,

Basically, like, would you accept a lower return for us living our values? ⁓ And we ended up having this whole discussion. Of course, I gave him a VC style answer, which was like, no, I don’t think you have to make that choice, which actually I believe in. But we ended up talking about it quite a bit. And he was saying, hey, we run a business. We have a lot of Fortune 100 customers. And they may have different sets of values than we do. And I’ve started to think a little bit more about, what am I supposed to talk about? My employees want me to

come out and address the issues of the day. It was just past pride month and they had changed their logo to the sort of multicolored flag version of their logo on their website without really thinking about it. And he was like, was that, is that appropriate? Like, is that what companies should be doing? It was a really interesting question. ⁓ And so as I am want to do, I called up Elizabeth, who’s my co-author on the first book and she and I have become very close friends. And when I have interesting questions like this, she’s the first person I think about.

So I called her and said, this is super interesting. And as we typically do, we sort of batted it around and decided, well, let’s ask some other people their opinion on this. So we started doing some research, not with the idea that we were going to write a book on it, but just because we wanted to understand how were people thinking about it. And that’s when we realized there’s an interesting story to be told here about the rise of business in society relative to government and media. And what are we asking businesses to do?

⁓ And so that became what ended up being the sort of the basis for the book. The book is about a broader set of topics, which is really the future of capitalism. Turns out it’s a bit of a defensive capitalism, which three years ago when we started researching it, maybe felt like it was less urgent to defend. But I think sitting here today probably is very urgent to defend and ⁓ at least urgent to have a conversation about. But we also talk about the ways in which neoliberal capitalism, which is the capitalism we’ve been living under for the last 50 years or so.

is maybe not working so well. And we outline an idea for how to change it.

Anthony Codispoti (35:57)
What is that idea? Let’s take a step back, define the liberal capitalism that you say we’ve been living under for the last 50 years and why you think it’s not working. Then we’ll kind of move into what maybe the fix is.

Seth Levine (36:06)
Yeah, yeah,

thank you. I think it’s actually important to do that, Anthony. So Milton Friedman, who many people listening have likely heard of, he was an economist most closely associated with the University of Chicago. He came out with a bunch of ideas about how the economy should be organized. He wrote a big book about it in the late 60s. And then he wrote an article in the New York Times in 1970. It was a bit more digestible, so it became more popular. And in it, he described that the only

responsibility of a business is to shareholders. That was, I’m paraphrasing slightly, but only slightly. That was the title of the article. And a bunch of people, it didn’t get adopted right away, but over the sort of course of the seventies and in particular in the eighties, specifically with Ronald Reagan and with Margaret Thatcher. So in the U S and the UK, but, then globally ⁓ these ideas really became embraced. And the idea was that the only thing that corporate managers and boards needed to worry about was making money for shareholders.

And it did a couple things. One is it sort of demonized government. Reagan famously said, government’s not the solution, it’s the problem. And it forced sort of this very short-term thinking upon companies, Where managers were incented. Shortly after this, there was another paper by a couple of Harvard economists that really sort of became the basis upon which the stock-based compensation movement ended up, especially for executives, ended up sort of taking off.

Some may argue to sort of like a crazy extent. And really that’s what we’ve been operating under for the last 50 years, right? 1970 through today, which is this idea that corporate managers only need to care about their shareholders. And we think that that’s short-sighted and a bit naive. And the result of that has been our economy has grown slower than it had been, right? So if you look at the economy from post-World War II through

1970. And there’s a bunch of reasons why it grew potentially faster, right? We had a bunch of people returning from the war. We had very generous education programs, the GI Bill specifically. Women were entering the workforce. That was a huge unlock for the GDP growth in the United States. But the economy was growing faster and it was growing much more equally. And then after the 1970s, the economy and our economic growth slowed and became much more unequal.

And so during that time period, just as one statistic to make it real, ⁓ the compensation for senior executives grew by about 900%. The compensation for workers grew 12 % total, right? So it’s just, everyone knows the stats, right? mean, the concentration of wealth has gotten pretty alarming. And you see it in our divided politics and in the rise of populism, right? Both on the left and the right, it’s the reason why double digit percentage of Mondami voters voted for Trump. ⁓

They care about the same things, right? In terms of inequalities, they say they care about the same things. Their prescriptions are very, very different, but everyone, think when Manvami went to the White House, everyone expected fireworks, and it turns out they just agreed on a lot of stuff because the typical Trump sort of MAGA base, if you will, had the same underlying challenges, opportunity, lack of opportunity specifically, that the Mamdani voters have.

Anthony Codispoti (39:28)
Which is what?

Seth Levine (39:29)
Which is the dynamism in the United States economy is largely gone away. We think about the American dream, the idea of being able to lift yourself up through your own sort of ingenuity and hard work ⁓ and the ability to ⁓ essentially out earn your parents. And both of those things have largely gone away. I mean, just by as one example, just to make it really clear, 50 years ago, if you were born in the bottom 25th percentile of wealth,

You had a 25 % chance of dying in the top 25th percentile of wealth today. And that is the American dream, right? It’s the ability to make, make yourself make and improve your station in life. Today, you have a 5 % chance of rising from the bottom 25th percentile to the top 25th percentile. So this opportunity economy has largely gone away. And a lot of what we argue for in the book is for ways that we can return to that. And I, you know, I felt like, or we felt like this book was necessary because

Anthony Codispoti (40:10)
Mm-hmm.

Seth Levine (40:27)
A book like this actually hadn’t really been written. There are plenty of people that have written something about evolving capitalism or changing capitalism. And they’ve tended to fall into two camps. One is academics who write these of largely unrealistic policy treatises that are relatively dense and not super readable. ⁓ And sort of they lack a lot of business experience. And so it’s written from that perspective. Or

let’s say the CEO who writes about their own personal journey and they’ve had this incredibly successful business and they did it this way and shouldn’t more people do it this way. those, mean, the, both of those books are interesting and we read a lot of them, but we wanted to write a book for the masses that was written from the perspective of people that have actually been in business for decades and, draws from conversations that we had with really, I mean, almost a hundred people who were some of whom were academics, many of whom were CEOs, some of whom are CEOs that you’ve heard of, right? Jamie diamond from

JP Morgan Shea sat down with us. Dan Schulman, who’s now the CEO of Verizon, was the CEO of PayPal, a bunch of people like that. But also companies that maybe you’ve never heard of and workers sort of across the spectrum of seniority to just try to get a lot of perspectives and then distill it into what I hope is a very readable and accessible work.

Anthony Codispoti (41:40)
So help me wrap my head around exactly what the problem of the last 50 years have been. Liberal capitalism, did it work for the period of time that it was working or was it always flawed back then? And now we’re just finally starting to see the cracks.

Seth Levine (41:55)
I think it was, so I think my answer is nuanced and we try to treat it in a nuanced sense. We actually have a chapter called the beauty and fallacy of Milton Friedman. really, I really tried. I wrote the first draft of that chapter personally, and I really tried to get behind the time in which Milton Friedman grew up, right? Came of age post-World War II, was one of the guys who actually, you know, met at Mount Britain and tried to come up with the new economy, right? For the entire world that…

that it was amongst this sort of group of very now famous economists, Schumpter and Hayek and others who were there. ⁓ And so I tried to understand that in context. I think it worked better earlier on because it was we’ve now had this like Frankenstein version of Friedmanism and neoliberal capitalism. and and it started out maybe a little less harsh. Even Friedman talked about investing in employees and things like that. But what happened over time is that we treated everything below the revenue line as something that needed to be

extracted from and essentially minimized, right? It needed to be optimized. And the result was very short-term thinking and very extractive thinking, both around, in particular, labor, but also around the environment. And our view is those things aren’t sustainable. And you only need to look at, well, you can look at the environment and sort of what’s happened there to see that extracting from the environment is not going to be able to be continued. And I think we’ve kind of gotten our heads around that mostly. But also sort of look at our

our current politics to see that we’ve extracted too much from labor. And by the way, at the same or middle class, let’s say, and at the same time, I mean, our economy really grows on the backs of the middle class, right? I mean, the truth is that the consumer economy is roughly two thirds of the US economy. And the way that we’ve done that is we sort of traded off not increasing wages for the promise of cheap stuff, right? You can buy $200 television and that should make everyone happy. And we combined it with

zero or close to zero interest debt for so many years. And really, we’re sort of at the limit of the middle class’s ability to take on more debt and therefore continue to consume. And so part of the argument we make, Anthony, and this is really important, is that we believe that we can grow the overall pie faster by making some changes in the economy. We’ll talk about it in a minute. ⁓ But it’s not an art. It’s not a redistributive argument, right? It’s not a and it’s not a sort of a

there should be no billionaires kind of argument. I just think that falls short. really prefer to think of the world as like strong floor, no ceiling. I’m borrowing from my friend, Oliver Libby, who wrote a book with that title. But I do believe that there should be no cap on opportunity, but we should provide the ability for more people to participate in that opportunity economy.

Anthony Codispoti (44:45)
Gotcha. So in the past, the problem has been just trying to squeeze everything that we can from lower and middle class people ⁓ in terms of income ⁓ and not allowing them to sort of participate at the full level, not giving them as many opportunities to rise up from the lower quartile to the upper quartile. And so the plan in the book, some of the ideas that you outline there are, how can we make this better? How can we?

make this more inclusive again.

Seth Levine (45:16)
Yes, exactly. And I, let me describe one more thing, but I want to say that it’s important for listeners to understand this is what we’re proposing is not some radical redefinition of capitalism, right? It’s, it’s a shift in capitalism, but it’s a little bit of a, I don’t want to call it a subtle shift because it’s a real shift. ⁓ but it recognizes in particular, and I’ll describe sort of the four key pillars of what we call dynamic capitalism, which is what we believe we’re sort of moving. We think we’ve actually moved away from neoliberalism that

In 2019, the Business Roundtable, is a group of about 200 of the biggest CEOs of the biggest companies in the United States, came out with their own statement of a purpose of a corporation. in it, they very clearly described that there are other stakeholders other than shareholders, specifically employees, the community environment, and suppliers. Jamie Dimon happened to be the CEO of the Business Roundtable at the time. And so we spent some time talking with him about this. And we got the story behind that. We tell it in the book.

But so we’ve kind of moved into this, what we describe as like a messy middle. So it’s not clear. Maybe we’ll pull back to neoliberalism. Maybe we’ll move on to something else. Trump is this sort of weird figure. It’s like a kind of a you know, a person or a personality of the neoliberal age, but he talks a lot more like a dynamic capitalist and he sort of governs sometimes as a dynamic capitalist, sometimes not as more as elite neoliberal. It’s sort of a interesting figure, which I think is more just evidence that we’re in this transition.

And we haven’t quite figured out what comes next, but you know, really there, there’s historically in the United States been this, this division that we have created between capital and labor. And the division was maybe slightly less important when the percentage of top line for most businesses that ended up going to labor was significantly higher. ⁓ but what’s happened over the last 50 years, we actually have a chart of it on this in the book is that that percentage of revenue that goes to labor has gotten.

smaller and smaller. We have minimized that because neoliberalism says you need to extract from that. Now, there’s no argument in the book that companies should somehow be less efficient. So that’s not at all what we’re saying. ⁓ But we are saying that we need more pathways to ownership and maybe to state it in a way that I hope people will sort of appreciate and maybe want to adopt is how do we create more capitalists, right? If you believe in a capitalist economy, then we should want more capitalists. And I think if you look at

what people said about why they voted for socialist in the financial capital of the world, New York. The reason that they said that was because they did that is because they felt like they didn’t have any purchase on the economic ladder of the United States. They were so swimming in debt of some kind. They felt like there was no opportunity to create wealth. They could not afford a house. The average age of a first time homebuyer has increased to 41 now.

up from like the late 20s, 15 years ago, right? So if people don’t feel like they’ve got a stake in the market economy, how do we give more? I mean, the solution is how do we give more people a stake in the market economy?

Anthony Codispoti (48:24)
So what’s the solution? What are the four pillars?

Seth Levine (48:26)
Yeah, so let me thank you. I can easily go off forever. should not forget to actually say what they are. So there’s four things. And again, these are not radical things. One is a shift from short-term to longer-term thinking. And we’ve already seen this in some companies. I mean, when Google went public, they wrote a long sort of dear shareholder letter that described that they were going to think about the long-term, not the short-term.

And by the way, companies under neoliberalism aren’t particularly good at perpetuating themselves. The average half-life of a Fortune 500 company is 20 years. ⁓ So it’s not like neoliberalism and this focus on the short-term was creating these sort of long-term benefits to even to companies and ⁓ their executives. So short-term thinking, no. Long-term thinking, yes. That’s thing one. Thing two, I’ve already addressed, which is an empowerment of the ownership economy. We have a bunch of ideas for how to do that very specifically in the book.

⁓ the third is a role for government, a limited role for government. have a law, we have a entire chapter that kind of goes through this and this theme sort of weaves its way in and out of the book. But I think there’s a propensity on the, on one side, certainly in the neoliberal side, but also I think in general on the right side of the political spectrum to say everything government does is terrible. Government should be involved in anything. And I think there’s also a propensity on the far left side to say government’s the solution to everything. Government should be.

way more involved in people’s lives. And we wanted to very clearly outline that we feel like neither of those two ideas is correct. The right idea is probably closer to less government intervention in our economy, lower regulations, things like that. So we thought we’d go through that in the book. ⁓ But it’s important to say, and then the last thing, is a little bit ⁓ kind of funny that we have to talk about it right now, but it’s true in this day and age, which is the respect of the rule of law.

or respect for the rule of law. ⁓ market economies can’t function, and the law, by the way, equally applied to everyone in our economy and our society. Markets can’t function without guardrails and rules. And ⁓ we are at a bit of a dangerous time in the United States where respect for the rule of law is maybe being challenged, right? And the law is not necessarily being applied. ⁓

equally across people. so that’s important to say. And so we, as we were talking about, you know, sort of early on writing the book, the first three ideas came out very clearly. And then, you know, at towards the end of our writing, we realized that fourth pillar is something that we really need to add.

Anthony Codispoti (51:05)
Who is your book going to make angry?

Seth Levine (51:09)
Wow. I hope a lot of people actually, right? I I think it’s going to make people angry, like sort of classic neoliberals, right? And there’s a lot of people who still have a stake in that style of economy. And I think the book will frustrate them because they ⁓ believe the system is working for them and they don’t believe, and this is important, that an economy that works for more people ultimately will also be better for them. And that’s the argument we’re trying to make. But I think there’s a lot of people…

And they’re not just on the right side of the political spectrum, but I think in this sort of category, they’re more likely to be. I think they won’t like this at all. They don’t like this idea. They think it’s too messy. Shareholders only as simple. What you’re talking about is too frou-frou, know, impact and the same people that are sort of going after DEI and impact investing and things like that. And we have a very nuanced discussion about what those things are and how, how, what’s the government role in those, those sorts of ideas. And maybe we’ve gone a little bit too far on many of them.

And then I think also it’ll anger plenty of people on the left side of the political spectrum who are like, look, capitalism is irredeemable. I don’t even want to hear about it. We actually address this early on in the book. We have a, have a chapter about whether capitalism can be saved. And I just think there’s a lot of people and I’ve talked to many of them ⁓ who are just say, no, there’s, there’s no role for capitalism. need something else. And I guess their read of history, even though there is not an example of a

socialist system, at scale, that has been successful. their read of history somehow is that, I don’t know, everyone else has done it wrong, and now we’re going to do it right now or whatever. I don’t mean to I mean, I’m dismissive in the sense that I don’t agree. I don’t mean to sound so dismissive that I’m not willing to listen to them. ⁓ But I think that it’ll it’ll it’ll anger those people as well. And we have a very nuanced view, for example, around the energy economy, right? The energy economy. We won the 20th century, the United States won the 20th century with the

largest economy, fastest growing, sort of by every metric. Most people, you know, not in poverty, things like that. We won that economy because we won the energy economy. And whoever wins the 21st century will also have won the energy economy, right? We need more electrons in the world. And so we have a pretty nuanced view of that. And those people that are like, hey, we need to have a moratorium on fossil fuels in whatever, 2030. Like that just doesn’t make any sense.

And by the way, we don’t believe we need to do that and be able to still have a planet we can live on. ⁓ And so I think there’s plenty of people who will read those sorts of things and either dismiss it or dismiss me. I’m a capitalist by job title, right? It’s pretty easy to, you know, sort of wave your hand and say, no, I think these ideas are dumb. And what I’ve been encouraging people, and I’ve gotten to a few of these ⁓ discussions on Twitter recently, is like, read the book, right? Like, don’t give me your feedback based on the…

you know, 200 character version of what we wrote, like actually read it and then tell me what you agree and disagree with.

Anthony Codispoti (54:04)
Short answer, Seth, what’s the single biggest lever that we could pull to achieve the goals that you have?

Seth Levine (54:10)
Create more owners.

100%. We’ve done that, by the way, we’ve done a pretty good job of that in, call it tech entrepreneurship. But, and I think a lot of people that are inside of tech entrepreneurship, because it’s very common to have most employees have some form of stock option or something, ⁓ don’t realize how little that idea has actually pervaded the rest of the economy. And so we talk about, in particular, we talk about a couple of guys who are working on this, one especially at KKR.

Peace Davros, who is ⁓ bringing some of these employee ownership ideas to much more sort of mainline manufacturing businesses in his case, but more broadly. And by the way, stock options are only one form of how you think about an ownership economy. So we go through a couple of other ideas, but EOPs, which are employee ownership, there’s like a couple dozen EOPs in the entire United States, 33 million businesses in the United States. And there’s a couple of dozen EOPs, right? So as one example.

But there’s some other pathways to ownership that we describe. But if there’s one thing that I think we could do, it is to create more owners. I want to get rid of this distinction between the capital class and the labor class. And I want to create far more capitalists than we have today.

Anthony Codispoti (55:27)
that. Let’s shift gears, Seth. would love because people look at you from the outside and like, wow, you know, Seth, bright guy, very successful things just come easy, right? Get to invest in all these really cool companies. What’s a really hard thing that you’ve had to overcome in your life, whether it’s something personal or professional? And what did you learn going through that?

Seth Levine (55:48)
I mean, one of the stories that I like to tell, I think people, I think people do sort of look at me or Foundry and sort of say like, that was easy, right? You were always going to be successful. And for starters, and no, it wasn’t right. Foundry has been hard on many levels at many times, and it’s very imperfect. ⁓ When we first started Foundry, so it’s 2006, and we are, the four of us came together and started sort of working on the, you know, things you needed to do.

And, and capital raising back then was a little bit different. We had to create an offering memorandum. We hired lawyers, all the things to do that. And I’d made a little bit of money, but not a lot of money. And I put my entire savings into Foundry, right? It was, and again, it was six figures, but barely. ⁓ And ⁓ there was, so that was, we started fundraising in January of 2007. And by May, it was really clear it wasn’t going to come together.

Right. We we we had there were no emerging managers back then. The conventional wisdom was you needed to be in one of probably eight venture firms or it wasn’t worth being in that asset class. There were a couple of what we would now think about as emerging managers that had raised their funds, but they weren’t well known yet and they had not been successful. So Union Square existed and these are all firms we were close to. But Union Square existed. First round existed. ⁓ True existed and Spark existed.

but no one knew who they were and there was no thesis around it. And I actually very much remember coming home in May of that year, so this is 2007, and saying to my wife, this isn’t gonna work. And by the way, I lost our life savings, right? I mean, we weren’t gonna lose our house, let’s say, but I was gonna have to go find another job. We’d had a kid and my wife was, at the time staying, she’s done a lot of different jobs. She’s a real estate developer right now, owns a bookstore in our town.

all sorts of things. But at the time she was she was working part time and and ⁓ and home with our our kids and and I was like it’s not gonna work. We’re gonna have to go figure something out and I like totally lost our life savings. ⁓ Her response wasn’t you know holy holy crap what are we gonna do? Her response was I believe in you guys I think this is gonna come together give it a bit more time.

And ultimately that is what happened, right? And the big thing for us was, you know, my now partner, Linda Lekman at UTimco said yes. And as many entrepreneurs who are listening know, like once you get a couple of yeses, all of a sudden it steamrolls. And we went from thinking that the fund wasn’t going to come together in May to, by July, you know, sort of realizing it was going to come together and it was going to likely be oversubscribed. actually were trying to, at the time, raise $175 million.

we ended up deciding to put a cap on it at 225. All of our early stage funds ended up being $225 million. And that was kind of the history there. And obviously, you know, I mean, my wife and I have been together for 25 years now, but like that was a really important moment in our relationship, right? Because it was a, it wasn’t just a like, hey, honey, I believe in you. It was like, hey, no, we have a real stake in what’s going on right now. And I know that this is going to work out. And I think you just need to like give it a little bit more time. And so I think that’s an important story because it really was

Both, Foundry was an all-in thing for me, ⁓ and obviously it ultimately worked out really well, but there was that moment in time when I was certain it was not working.

Anthony Codispoti (59:12)
What was the inflection point? What allowed that to switch?

Seth Levine (59:18)
You know, I, well, I mean, the one thing was Lindell saying, I’m there, I’m going to do this. Right. And thank, thank goodness that he had a thesis around emerging managers. had invested in both true and usv. ⁓ and, and I think eventually spark as well. And so he was like, Hey, I actually think that there are, there will be this class of entrepreneurs. Interestingly, most of those funds were not in the Bay area. ⁓ true was, but usv, spark and foundry were not. ⁓

And he had a real thesis around that and that was the catalyst. But ultimately it was, and this is true for a lot of entrepreneurs, like you have to stick with it. ⁓ And we really, it was a good reminder that like a lot of things that seem easy in sort of hindsight were not easy. ⁓ And the truth is raising Foundry’s first fund was not easy and we needed to persevere. And maybe there’s some parallel universes where it didn’t come together.

And Lindell didn’t say yes, right? And we weren’t able to manage it. And I don’t know what I would be doing in that universe, but ⁓ it’d be very different than this one.

Anthony Codispoti (1:00:24)
Interesting. So without Lindell saying yes, that your future could have looked a lot different. There was somebody who believed in you that bought in, you know, and you raise a really interesting point Seth about entrepreneurs just need to keep going, right? Persevere. Because what we often hear, you know, the overnight success, and I’m using air quotes for those people who are just listening, excuse me, it’s no almost never is there an actual overnight success, right? It’s something that you didn’t hear anything about that.

Seth Levine (1:00:30)
I think so. Yeah.

Anthony Codispoti (1:00:52)
people were toiling away in the background for years to bring to fruition. And then, you know, when it finally pops up out of the ground as this beautiful flower, you know, that’s when you get to pay attention to it see it. But, you know, there’s so many people grinding, working on something really hard. How do you think about, because there are some times where things just don’t work, right? Even in the venture space, you’ve seen a lot of companies that they put their best effort in and there wasn’t a product market fit, whatever, you know, something happens, it just doesn’t work out.

So how do you think about that? you know, sort of like, when do you know when you need to keep putting nose to grindstone versus, hey, it’s just time to hang it up?

Seth Levine (1:01:31)
Yeah. And I’m sorry to give an answer that’s messy because oftentimes you don’t really know, right? Or you know, in hindsight, and I say that because so many times in my career, in the history of Foundry, we have put more money into something thinking it was just about to turn the corner and it didn’t. Right. And, you know, oftentimes that’s what it takes is like, we’re going to try one more time. And sometimes one more time after the one more time before we finally get it in our thick skulls.

this is not working, right? And, you know, look, one of things I think distinguishes the United States from other entrepreneurial economies is our acceptance of and even embrace of failure. And so I think that, and so I think that’s positive, right? So when you get to the end of the line and say, look, it just didn’t work, it didn’t work, ⁓ but it’s very hard. And I think this is one of the reasons that we have an effective partnership, for example, is that the person who is closest, which is the CEO, the founding team, and oftentimes the board,

the partner that is on the deal, they have the least perspective, right? And I think one of the things that an effective partnership does is they push each other, right? And an effective advisory board or an effective CEO group or EO group, something like that. ⁓ They push each other to say, hey, Anthony, I know that you really don’t want to give this up. Let me show you and share with you what I’m seeing. And I don’t think it’s there.

⁓ And I think that that role for a partnership is really, it can be challenging, but I think it’s really, really important. Right. And this is the sort of proverbial, you know, every new investment, should be viewed as a brand new investment. Forget the sunk cost really hard for humans to do. We don’t naturally do that. And, ⁓ you know, sort of the, the proverbial, you know, bad money after good. I also think there’s a tendency, there’s a book by Annie Potts, which I really enjoyed. I’d highly recommend it’s called thinking in bets.

Anthony Codispoti (1:02:59)
Yeah.

Seth Levine (1:03:29)
And I think there can be a tendency in venture to always look at the decision from a few years ago based on what you know today, right? Few years later and what the outcome was. And what Annie says in her book is you have to judge decisions by the information you had at the time. And the judge of a good decision was whether you should have made that decision based on what you knew at the time, right? And that’s so that doesn’t mean in, she’s a poker player, she’s.

describes things in terms of poker, but you you have a two seven, right? It doesn’t mean and it eventually runs, you know, turns in your direction. ⁓ That doesn’t mean that you should have played that hand, right? The outcome was the unexpected outcome, not the expected outcome. ⁓ And so she talks about that relative to startups. And, you know, we’ve at different times tried different ways of evaluating decisions and decision making frameworks ⁓ through the sort of pot’s lens, if you will. But I really

I think it’s important because a lot of people like to do post post mortems. we shouldn’t put more money in whatever, whatever you can’t judge that based on well, the company didn’t work. So therefore we shouldn’t put money in like that. That may not at all be the case, right? The case might be, hey, based on what we knew, we should have put money back in in this company back in the day and and and the opposite is true, right? Sometimes you put more money in and it works out, but you should be thoughtful about do we get lucky and it worked out or was this a really good decision and it worked out? And that distinction is really

I think challenging for firms to actually sort of understand.

Anthony Codispoti (1:05:02)
So we’re recording this on December 10th, 2025. You just had your book launch party yesterday at your wife’s bookstore. What’s the name of the bookstore?

Seth Levine (1:05:10)
It’s a composition shop in Longmont, Colorado. It’s absolutely gorgeous.

Anthony Codispoti (1:05:15)
Yeah. So fun times. The book is now out. It’s available. What’s the preferred method for people to buy it? Is it Amazon? Is it your website?

Seth Levine (1:05:23)
I would say whatever is easiest for people. So if you go onto our website, which is thecapitalevolution.com, ⁓ there’s an order button and it’ll take you to a page where there’s a bunch of different options for buying it, whether that’s through Amazon, through Composition Shop, of course, ⁓ through Barnes & Noble, Books A Million, et cetera. ⁓ But ⁓ also you should be able to find it at your local bookstore. It should be pretty widely available. And so I would say whatever is easiest for people.

And by the way, it’s available on Audible as well. came out, the Audible version came out, came out yesterday, the same day the book was available.

Anthony Codispoti (1:05:57)
All of the entrepreneurs with ADHD that are listening right now are like, thank goodness.

Seth Levine (1:06:01)
Thank goodness. Yeah,

you and me both. I listen to most of my books rather than read them.

Anthony Codispoti (1:06:07)
Yeah. So you’ve been working on this book for a while. Now it’s out and you’re doing some book promotions and that’s going to last for a period of time. And then what? What’s next?

Seth Levine (1:06:17)
Yeah. So this is actually a more nuanced question than maybe listeners recognize. Foundry made the decision. We raised our last fund in 2022 and in 2023, we announced to the world that we weren’t going to raise any more funds. Uh, we, we wanted to get ahead of that. didn’t frankly, just to be super blunt, we didn’t want to make it look like we couldn’t raise another fund and therefore we decided not to. Um, so we announced it relatively early in that fund cycle. And that was kind of always the plan for Foundry. was so

associated with the four original partners. One of my partners has already retired. And, you we just got to the point where we felt like it was enough. Brad just turned 60. ⁓ And, and sort of the rest of us were like, hey, we’ve done this for as long as we wanted to do it. ⁓ So I 2025 for me, if I can just sort of share personally, was a year where I thought a lot about, do I want to do something structured? Is there a next thing for me? ⁓

And, and the conclusion I came to was, yes, right. I’m in my early fifties. I feel like I’ve still have a lot to give back. Um, all the things I want to do. I still have a high degree. I have my own version of ADHD and I like to tell people my mind is a very cluttered place. Um, and, uh, and I find work is what actually allows me to kind of quiet it down a little bit. Um, so I definitely want to do something next. So that was 2025, 2026 is when I’m going to start.

really thinking about what that is and I hope to find what that is. So I’m, working on a few different ideas, some of which look more like foolish time work, some of which are a bit more kind of part-time in nature, but, but I’m really excited about that. ⁓ I suspect it will involve writing more cause I really do enjoy the process of writing again to the crowded mind idea. I find when I’m sitting down writing my mind quiets quite a bit. And I think that’s part of why I love the process of writing a book so much is that it.

It does sort of allow me to focus in a way that a lot of other things don’t. ⁓ and so, it’s sort of a long rambling answer to, to basically say, I don’t know, but it’ll be, I hope it’ll be something interesting.

Anthony Codispoti (1:08:22)
Hoping

to get some clarity ⁓ in 2026 as things maybe slow down for you, you get a little head space to think about that.

Seth Levine (1:08:28)
Yeah, and give myself the

grace of time, right? I felt a little pressure because people immediately after we announced in 23 that we’re going to do another fund, everyone called me and said, hey, what are you doing next? And I was feeling some pressure around that in 23 and 24 to define what it was. And I just I was busy enough with the book and other things. was like, look, I’m just not going to do that. And I really had this epiphany over the summer in particular this year, so 2025, that I definitely want to do more and something that has some structure to it.

So we’ll see what happens.

Anthony Codispoti (1:08:59)
Seth, I’ve just got one more question for you today, but before I ask it, I want to do three quick things. First of all, tell people the best way to find you, get in touch with you, connect with you if you want that.

Seth Levine (1:09:08)
Yeah, two ways to get in touch with me. I have a blog. I’ve been writing for the book, so not as much on the blog, but it’s Seth Levine, L E V I N E dot com. Um, you can also find me in my addresses. My email address is all over that. Uh, you can also find me at foundry.vc. That’s our, our corporate website. Again, my email address is all over that. So I would encourage people to reach out. I would, I would ask, uh, don’t reach out on LinkedIn. I, I do sometimes scan my LinkedIn in mail, but it, it, it’s not a reliable rate way to reach me.

So that’s really the best way is to go find my actual email address and send me a note.

Anthony Codispoti (1:09:42)
Great. We’ll include that in the show notes for folks. Also, as a reminder to people, if you want to get more employees access to benefits that aren’t going to hurt them financially and carries a financial upside for the company, reach out to us at adbackbenefits.com. And finally, if you’ll take just a quick moment, leave us a comment or a review on your favorite podcast app. It’ll hold a special place in my heart forever. Thank you. So last question for you, Seth, a year from now, you and I reconnect and you are celebrating something big. What’s that big thing?

one year from today.

Seth Levine (1:10:13)
Well, I have ⁓ two seniors in college right now. So I hope it’ll involve them ⁓ being in a really like they’re launching into the world and into life. I actually, I hope it’ll be ⁓ something really ⁓ positive for them. and, you know, I’ve been, I think a lot about my wife’s work right now. She’s, ⁓ she’s a real estate developer. She’s redeveloped a bunch of buildings in our downtown quarter, which again is the, the sort of the, not sort of the, the town next to Boulder. It’s called Longmont.

And she’s really kind of helped transform the downtown of ⁓ our city. And so I think also a lot about sort of her and her success. So it may not be the answer you were looking for, but I really, I’m thinking about them. I have a son as well who’s sort of at the end of high school here. So I mean, I hope everyone’s in a really interesting place. And I think that’s what I would most like to celebrate.

Anthony Codispoti (1:11:04)
I love that your ⁓ one year goals are for everybody in your family. Very selfless. ⁓ Seth Levine, I want to be the first to thank you for sharing both your time and your story with us today. I really appreciate it.

Seth Levine (1:11:09)
Fantastic.

Anthony, this is a really wonderful conversation. appreciate you.

Anthony Codispoti (1:11:22)
Folks, that’s a wrap on another episode of the Inspired Stories podcast. Thanks for learning with us today.