Eric Berry (00:00)
We, on our first board meeting after raising the $2 million, which was a seed round, the board that the idea that they invested in was pretty dumb.

And that here are six others that we're thinking about and they were basically like those first five are pretty good, but that sixth one is not good. And we were like, I respect your feedback. And then we went and did the sixth one.

they told us later, we were like a team bet, not a, not an idea bet. And they actually thought our idea was pretty dumb.

Kevin Holmes (00:25)
Yeah.

welcome to the Founders Network podcast with Eric Berry, founder of TripleLift. They had an exit in Averin where he's doing health investing and technology. Welcome, Eric. Thanks for being here.

Eric Berry (00:44)
Thanks for having me. It's a pleasure.

Kevin Holmes (00:46)
All right, so we were just talking about ⁓ restaurant concepts.

Eric Berry (00:49)
Yeah, yeah, I just finished my salad and I was sort of taking pity on myself for eating, eating a salad. But now I wish I had some other food, but it's it's yeah.

Kevin Holmes (01:00)
It's back there. You need some barbecue or something tonight. ⁓ But good to have you. We don't have unlimited time, so we wanted to talk about your journey as a founder at Triplelift, a unicorn that you raised, I think around $17 million and a $1.4 billion exit. So modest outcome for you there. And some trials and tribulations that all founders face that even you too live through.

Eric Berry (01:03)
the dream.

Kevin Holmes (01:25)
So I wanted to talk about that. And then, especially around fundraising. And then we were going to talk a little bit about your new thing in Averin and where we are in this moment around investing and AI and some of the trends that you're seeing and moats and distribution and all that fun stuff. So why don't we just start with like a little bit more of an extended intro and your background and your journey and you know, how you found yourself sitting in the chair where you are today.

Eric Berry (01:54)
All right. I appreciate the background. And it's always good to see you, Kevin. And thanks for having me on the podcast.

Kevin Holmes (02:02)
Likewise.

time, we can keep talking about restaurant ideas, because that was pretty fun.

Eric Berry (02:07)
And I will note that Kevin

wanted a prep call and I missed the prep call because I was buying fish for my daughter trying to pretend the fish that died didn't die. And so I'm sorry once again about doing that to you. Yeah, was a complete failure. ⁓ So, all right, I'll just give a little bit of a story here. I'm not sure how far back I should go, but... ⁓

Kevin Holmes (02:21)
which failed, but she didn't buy it. She's a smart kid. Yeah.

Eric Berry (02:34)
I guess I'll just go to college, is undergrad, grad school, computer science, graduated, no idea what I wanted to do. Everyone was like, Eric, you're super argumentative. You should go to law school. And if somebody says that to you, you can't really argue with them because then you just prove them right. And then you just, one way or another, you end up in law school. So I did law school. I was a practicing M.A. attorney for a few years.

did not care for that and ultimately found myself back in the tech world where I had always naturally gravitated. As a kid I was always hacking on computers and stuff. So I was the founder and CEO of a tech company and it was in the ad tech space. We were the sort of originating idea.

for the business was, at the time we founded the company, we were in this accelerator and we had applied to this accelerator with a totally different idea. And every other company in the accelerator was really far along, or at least modestly far along. They had a business with customers and stuff. We didn't even incorporate until the second day of the accelerator. And...

So we shared an office with a company that was doing a wedding website app. And at the time, which was like forever ago, 2012, Pinterest was just starting to blow up. was like Pinterest for a very brief moment in time was the fastest growing website in history. so we were, we were

doing our business, which had nothing to do with anything, and kept hearing about Pinterest. And the more we kept thinking about it, the more we kept thinking, like, you know, there's something interesting here. And we had a bunch of really dumb ideas. And so it's important to note in the history of my company, we pivoted probably seven times prior to doing what we ended up doing. And so even...

Kevin Holmes (04:19)
you

So,

can I ask you about that? Stop it for a second. So it sounds like you just wanted to do something, but you didn't quite know what it was.

Eric Berry (04:34)
Yeah.

That is a accurate way to describe it. Yeah. and we tried to, so I founded a with another guy, and we tried to move quick, react to market feedback and not, fall into a trap of like, you know, if we've put a lot of effort and try to salvage whatever effort it was, but just keep moving. And so we did a bunch of pretty dumb stuff.

⁓ we did the demo day for the font for the accelerator with an idea that I thought was like a seven out of 10 at best. and. You know, we ended up raising at the time, what was a decent sized round, which was $2 million. Now it's like a pittance. and, ⁓

We, on our first board meeting after raising the $2 million, which was a seed round, told the board that the idea that they invested in was pretty dumb.

And that here are six others that we're thinking about and they were basically like those first five are pretty good, but that sixth one is not good. And we were like, I respect your feedback. And then we went and did the sixth one. And, um, the general idea of the, one and what became, uh, the company, which was called triple lift, um, is this idea that, you know, we saw, like I was getting at Pinterest and all the other,

businesses that were sort of taken off at that time, which remember is a long time ago and internet years, Tumblr, Instagram, Twitter, those were not, mean, know, Tumblr, I don't know if that still exists, but the rest are not today what they were. And so our view was, you know, they're gonna want advertising, but they're not gonna want

generalized banner ads. They're going to want something that's more integrated into the user experience, which they're spending a lot of time working on. so our view was also, know, advertisers don't want to create separate assets for each different platform.

there are banner ads and banner ads exist because a marketer wants to sort of create a single ad or three or four different sizes and have it run everywhere without needing to conform it to all the different standards. that just changes the, if you think about from a marketer's perspective, they have two real costs.

One is the cost of the creative of making the ad and one is the cost of the media, which is like placing the ad. you know, broadly, if they can have a creative with less cost, then they can spend more on media, more on distribution, get it front of more eyeballs. And so our view is if we could use technology to use a single set of assets and make it look great on all those different publishers like the Instagrams and whatever the world, that'd be great. But of course, the

those big publishers had absolutely no interest in working with us. So again, we pivoted towards, what if we just sort of take that to every other publisher, like the New York Times or whatever of the world, and make it so we can use the tech that we were originally coming up with, and make it so the ads were more integrated into their user experience. And the way that we ended up doing that was building tech that

looked at the assets marketers were using, used computer vision to understand where the faces, bodies, edges, focal regions, logos, et cetera. And then per publisher, we would create a custom placement. And then at bid time, so using a real time bidding context, we would dynamically reconstruct the assets that the marketers used to bid with to look great on each different publisher. And that would happen fully

in about 100 milliseconds, end to end. And we were doing that like 100 billion times a day by the time we started the business. And so was a big high throughput, low latency, globally distributed system. A lot of money was flowing through it. And yeah, mean, know, AdTech was a really interesting space because when we were running the business, well, we started by...

Kevin Holmes (08:20)
Wow

Eric Berry (08:40)
know, scaling it and it was, well, we started by building the tech and we didn't actually know if it was going to work. And so we built the V zero. We did this like first test and it just like, it didn't make it. Um, it like just blew it out of the water. Um, from a performance perspective, from a consumer engagement, efficacy, et cetera. And so our, our lead VC.

at the time was True Ventures. sort of like proactively came out with a Series A term sheet, helped us really scale the business. Big fan of those guys. they, I mean, so, and then we just kept scaling the business. And so every year we were growing at several hundred percent a year. But.

Prior to, like at around that time, 2015, 2014, 2016, there were a bunch of ad tech companies that kind of scaled quickly and then just didn't like go anywhere. They reached a ceiling and they fell off or whatever. so that ad tech space was really unfavored. And then of all of that.

was that we knew we had to build a capital light, a capital efficient business. And so not scale recklessly and keep our costs in order. Because basically, even though our scale metrics were off, you know, we were doing 200 % a year growth, which means 3X year over year growth.

Kevin Holmes (09:56)
Hmm.

Eric Berry (10:06)
people, it was really tough for us to raise money. So we spent a lot of time and that was back at the time when 3X year over year growth was interesting. you're not growing 17X, you're nothing. And so that was, you know, so we fundamentally changed our operating model to create a cash focused

Kevin Holmes (10:09)
Hmm, it's incredible to hear that. Yeah.

Eric Berry (10:26)
business, which is basically we spent a lot of time, months and months, every year at the end of the year, creating an operating plan for the following year, where we said, what's the fastest we can grow subject to cashflow break even on the year. And, you know, then we started getting into all these trade offs about, you know, future R &D work.

versus current and you know how can we get synergies out of the team what's the most efficient incremental use of the dollar and so forth and those are really good conversations to have and it made us really efficient business and so we kept growing and not needing to raise more money we did a series B and that was the last we ever raised in 2015 three or three and half years after we started and you know even then we were profitable from that point on and

Yeah, then we changed the target from breakeven to what's the fastest we can grow with a 10 % EBITDA margin on an entry year basis. And then we were able to scale the business pretty well and have a lot of profit. And ultimately, I've been talking for a while, so feel free to interrupt me.

Kevin Holmes (11:40)
Yeah.

Eric Berry (11:41)
we had never really thought about selling to business. And, you every time we did a prior round of financing, there had been like one or two companies that were in the mix. We talked to Yahoo in the heady Marissa Meyer days of like buying anything with a pulse to some of the social media companies who had been in our orbit. But we never had a concerted effort to

Kevin Holmes (11:59)
Thanks.

Eric Berry (12:04)
to actually sell the business. And so then one of our large, very large West Coast strategic, know, trillion dollar type companies was sort of sniffing around to see if we would sell the business. And at that point, you know, we were like a decade in kind of getting a little tired.

And so we hired an investment bank to run a process to basically maximize the outcome or to get us some secondary where we could keep going. Push comes to shove. We've got a great deal with private equity firm, sold majority of the company for, like you said, 1.4 billion. And, you know.

I can pause there if you want to ask anything or I can keep going.

Kevin Holmes (12:49)
Yeah, well, let's pause here for a minute. And I want to go back and sort of drill down on some of the key moment key moments. Your your number six idea that you felt was a seven out of 10 turned out after all to be a pretty decent. I mean, I wonder what a 10 out of 10 is, if that's a seven out of 10.

Eric Berry (13:04)
⁓ no, sorry.

That idea, the idea that we presented. Yeah.

Kevin Holmes (13:08)
The one you finished the accelerator with 7 and 10.

So this board is not, your board is not always right. It's kind of a takeaway, right? Like as a founder, you have to have discernment about, you're the only one in the driver's seat in your shoes in charge of the company. They're kind of outside. That's probably a trap a lot of founders fall into though, I would guess that, you know, listening maybe too much to the board. Can you speak to that a little bit about that?

Eric Berry (13:31)
Yeah.

Kevin Holmes (13:32)
I'm really interested in like the decision-making part of this and how do you make decisions as a founder?

Eric Berry (13:37)
Well, you you're like, you're definitely taking a risk if you go against what your board says like that and you're the founder. Because, you know, I've written a few social media posts on this point, which is, yes, a lot of founders look to their board.

Kevin Holmes (13:45)
Hmm.

Eric Berry (13:57)
for strategic advice. And I don't always think that board members provide the best strategic advice. so, you know, I'll foreshadow a little bit, which is to say I'm now a VC and I try to at least take some pains to avoid what I think were the traps that

you know, some founders would maybe myself in a prior role would have fallen prey to, which is, know, if the board.

is really strong on certain strategy, they're definitely not subject matter experts. Almost never, almost never, 99.9 % know more about the founder's specific industry than the founder, right? They do know in many cases more cross-sectionally and they know more broad strokes thematically, but way less about maybe what the specific...

industry is, though it depends on how far along that company is and that founder's specific experience in the company and so forth. and so I think it's really helpful for a board member and a founder to be like honest and open with each other about what they do and don't know and to phrase that conversation appropriately, to be sensitive. and so

You know, I think it's, there's, there's a certain ecosystem that's built up in the VC community about founders sort of like pretending like they know everything.

You know, VCs sort of tend to respond well to that. At the same time, think once you, and that works well in a pitch context, but once you're past that, I think there's a lot of value to being really honest and open and vulnerable and saying what you do and don't know as a founder. And a VC also should say what they do and don't know and should ask questions that they think are interesting questions, but not say answers unless

Kevin Holmes (15:43)
Yeah.

Eric Berry (15:55)
they actually know the answers.

Kevin Holmes (15:57)
Yeah, we have a sort of no guru rule at Founders Network. coming from higher ed, when I started the Entrepreneurship Center at Santa Clara, there was this distinction between anecdote and knowledge and data. What can you do a regression analysis on to really prove is true versus what was one person's experience? And anyways, that's kind of why I started Founders Network was to create that.

Eric Berry (16:10)
Yeah.

Kevin Holmes (16:20)
peer group where you can kind of get lots of cases and sort of discern with that and the decision making. But I think that is a great point. Like there's so much, there's so much kind of pedantic, like here's how you do it. You know, go from here to, and as a founder, it can be a little bit of a look confusing and maybe cause you to question yourself. And conversely, some of my favorite founders are the ones who are

able to hold the questions and not have an answer. Like you don't always have to have the answers, right?

Eric Berry (16:51)
Yeah, exactly. It's uncomfortable, right? Because nobody like.

society isn't set up to reward you for saying you don't know the answer. ⁓ At least at first blush. But I think, you know, the medium term result tends to be better if you admit you don't know and you're running some experiments and whatever, as long as they're thoughtful and you can talk about the construction of the experiments and, you know, whether they're set up to get the data that you want and all of that in a good and productive way.

Kevin Holmes (16:58)
Yeah.

don't know, but I'll work like hell to find out. And that's the second part that everybody should be investing in. Right? Yeah. Yeah. I love that. I want to talk a little bit more about this stage too of like, going through all these different ideas and the ideation and like you, you know, you wound up doing law school as sort of a default mode. and then, did the accelerator and like,

Eric Berry (17:21)
Yeah.

Yeah, here's how I'll find out what are your thoughts on that strategy.

Kevin Holmes (17:41)
I don't know. I come across a lot of founders and some of them are missionaries. they, you know, they've been 20 years in that space and then they see the opportunity and like they're just dying to solve that thing. Your story doesn't strike me that way. It's more like I wanted to be an entrepreneur or I don't know. Maybe, can you speak more to like, what was your, in those early, like what made you decide to do this and go down this path? And, and then also like,

your ideation and selection process? Like how did you, did you like, if it wasn't something that was like a burning thing, you know, the pain that you'd experienced, what was the sort of frame for you of coming up with these ideas and then picking?

Eric Berry (18:23)
Yeah, mean, well, so there was, there's a lot in that question. I guess the first bit was, know, I very few people that go into ad tech are missionaries in the sense of like, and I will, you know, we haven't gotten to the second half of my career. if half is used generously, but,

had my first half in, I guess, ad tech, if you ignore the law part. you know, honestly, that was a, there's a lot of intellectual challenges in ad tech. It's a good place to make money. It's a good place to learn how to run a business, to run a business, to, you know, it is an intellectually challenging place. But at the end of the day, it's ads, right? You're not,

Kevin Holmes (19:05)
Yeah.

Yeah. Changing the world. Yeah. Yeah. Yeah.

Eric Berry (19:08)
You're not helping in any way.

And so, you know, I did it. Like I had a good run there. Did the stuff there. I learned how to run a business. Made my money. Broadly, I feel like what we did was good and moral and ethical within the world. Now I do healthcare.

Kevin Holmes (19:26)
Yeah.

Yeah, yeah. Let's talk about that. Because now I feel like you do have more of that purpose driven second half of your career. But it's interesting anyways, just to note that like, because I don't necessarily think one is better than the other necessarily in terms of like outcomes as you, you know, as you're describing your time at Triplelift, like, there, that doesn't sound like it was, like you said, it wasn't a missionary thing, but it

it was kind of a top down almost like, oh, there's a rich space. Oh, that's really interesting. Like that would be a good opportunity. So you're kind of almost tops down versus the bottoms up of like what's inside of you. Like what, you know, pain are you feeling that you want to solve? Yeah.

Eric Berry (20:06)
Yeah. Well,

can tell you, so like the company we built at Triplelift was a very AI driven, computer vision focused business. And, you know, we acquired this Swiss company, OnePlus X, whose tech was in many ways like a bit of a precursor to parts of LLM tech and,

Obviously they didn't like, you we didn't, I'm not, I'm not implying anything other than there was a lot of complex AI technology, lot of complex machine learning. It's an machine learning focused AI focused field. And that's a difficult and stimulating mentally stimulating place to be. And so, yeah, that's cool. I enjoy it at the same time.

Kevin Holmes (20:45)
Yeah.

Eric Berry (20:51)
it was important to me to, from a YOLO perspective, not live and die and have only contributed to ads. And I just had a really hard time with that. so it is the case that in college and grad school, both at MIT, I was focused on

bioinformatics, that's what I was doing. So my brother and I were working in the same lab together, doing experiments together on the sugars and cell membranes used in signaling and growth. did my grad school work in the first ever sequencing and analysis of two mammal genomes, the human and the mouse. And so I had done some like healthcare stuff and then went.

the ads route. And then, you know, my brother is a very successful VC. He's done a whole slew of stuff, including launching about 30 companies, seven worth over a billion. of Moderna, he graduated the Harvard MIT MD PhD program and the fastest time in modern history. And

Kevin Holmes (21:48)
Including Moderna, right?

Eric Berry (21:58)
So he's no slouch and he was at this VC firm for just under 20 years and you he'd kind of been the like number two-ish and I think was kind of starting to think about, know, maybe I don't want to be the number two anymore. And so we started talking as I was talking about leaving, you know, you sell your firm to a private equity firm and

It's a cash transaction and you learn what you can and that's sort of the end of the road. So I gave him a year that I was gonna leave and started thinking about what was next. yet, so David and I were talking about what we thought, David's my brother, about what we thought were the big GDP impacting disruptions on the horizon. And then we started thinking, right to play, right to win and interest.

It was our view really that tech had gotten to the point where it could start to really fundamentally move the needle on every touch point in healthcare and that these massive changes, know, just like hundreds of issues in healthcare that have previously been intractable problems. you know, technology is not going to out of its gates, out of the gate, solve the principal agency.

or cash flow problems that are at the heart of...

many challenges in healthcare, but they will solve many of the other challenges in healthcare. And so it was our view that, you know, we are on the precipice of this technology driven disruption of the whole $5 trillion healthcare ecosystem. And that in the 30 to 50 year horizon, it's almost inevitable that there's going to be just massive transformation in across basically every touch point.

Kevin Holmes (23:32)
Thanks for listening.

Eric Berry (23:41)
healthcare. And, you know, I'm an operator and CS tech guy and he's a healthcare and investor guy. We're like, Hey, man, it's like, it's kind of makes sense. and so then we just decided to get going. and kind of like,

My old firm, Triplelift, we came up with a few different ideas, pivoted a few times, and then ultimately I think found a strategy that makes a lot of sense and went full aboard with it. And like my old company, we came up with a name, it didn't work, and then rebranded early. We also did that. We were Bedford Bridge early.

Kevin Holmes (24:14)
That's right.

Eric Berry (24:15)
And

then we found there was another firm called Bedford Ridge, also in the healthcare space. And we were like, that sucks. So then we changed our name.

Kevin Holmes (24:21)
Hahaha

I kept getting all that traffic. ⁓ Well, smart play. So I love the framework of right to play, right to win and impact. And then this idea of, again, like actually smart way to do it, like thinking about where's the big GDP, the top down macro view of like where the opportunity is going to be. I think in tech, like a lot of times it's just default, right? Like, it's AI today, you know? And then it was.

Eric Berry (24:25)
Yeah.

Kevin Holmes (24:47)
something else and, you know, SAS or Web 2.0, Web 1.0 or PC or whatever, you know, so, but to go into, um, in the right to play, I think you articulated that really clearly. I didn't realize that you did that in college, uh, had that health bioinformatics focus. That's really neat that you worked on the, DNA. Um, I mean, it's a big deal. Yeah.

Eric Berry (25:07)
Yeah, I

in a Nature article, Nature cover article for the mouse human comparative analysis, the first ever two mammal DNAs. And back at the time, I was using what counted as a supercomputer to do it, which is like probably less powerful than your MacBook. But, you know, at the time it was a big deal.

Kevin Holmes (25:26)
Yeah. Yeah,

that's super cool. I'm reading Selfish Gene right now. Richard Dawkins. It's interesting. It's just a whole view that all we are is survival machines for our DNA. And it's just been, we're like the progression from the primordial soup of defense, offense, to get more input and raw material for these things to keep replicating. ⁓

Eric Berry (25:31)
I don't know.

There's a theory

that viruses evolved as from, you know, whatever to living things and then kept, and they were like actually alive. And then they kept optimizing and kept cutting out the stuff that wasn't necessary to the point where they hit like sort of this not alive state again. that is like maximally optimized for.

the propagation of the DNA strand that is the virus. And so it evolved to be not alive.

Kevin Holmes (26:19)
Huh. And then we went the other way. Yeah. And it, right. But it must have branched, right? ⁓ Yeah. And there's a lot of math that was surprising to me. There's a lot of math in this as well.

Eric Berry (26:22)
Yeah, I suppose. No, I mean, it evolved from being alive to being not alive, from the same ancestral tree. Yeah, yeah.

Kevin Holmes (26:35)
Yeah. Okay. Well, let's talk about Averin. You mentioned this thesis that you've iterated on and kind of landed on and let's talk more about it. So obviously everybody's talking about AI ad nauseum. Is that a big part of Averin or?

Eric Berry (26:48)
AI? What's that? ⁓

Kevin Holmes (26:50)
Yeah,

it turns out it's a real trend. Yes.

Eric Berry (26:53)
You're talking about Allen Iverson?

⁓ AI is a huge deal. That said, I think we take great pains to invest where we think that there is a durable advantage for companies where AI is a tailwind and won't soon turn into a headwind. And so an example of

Kevin Holmes (26:56)
Talking about practice.

Eric Berry (27:17)
in a different space where AI was a tailwind and will, I believe, soon turn into a headwind is like a company like Harvey or Legora or whatever, which is an AI for legal tech where they are built on top of third party models and not necessarily providing too much.

themselves, you know, maybe people will talk about workflows, but you see now there is these open source alternatives that are just like copying the workflows using the same third party models. And Claude is making it easier and easier to do more and more in the legal space. So, you know, that's quickly becoming a headwind. And so we think a lot about where is that not the case? Where is there a durable advantage? Where is there something that, you know, can

Kevin Holmes (27:50)
Mmm.

Eric Berry (28:05)
but where AI is a tailwind. And so an example of that is a company we invested in, Mendera, where Mendera builds surgical robotics that are super lightweight and built to fit into the flow of how...

surgical theaters operate today while producing dramatic improvements in the efficacy and know reduction of complications and so forth in outcomes and Do it Leveraging the best of what AI and other things bring to bear and that's the sort of world where yeah You can take advantage of AI, but it's very unlikely that 100 gram robotics that

produce sub-millimeter accuracy for deep needle insertion are going to be a focus of OpenAI and a lot soon.

Kevin Holmes (28:47)
Yeah.

Right, right,

right. So it's a hardware mode, it's regulatory healthcare medical mode. It's also maybe a niche as well, where it's going, like you just said, it's going like a very specific thing that's.

Eric Berry (29:03)
Yeah.

Well,

that's a niche, but it turns out to be quite a large niche. that's a very common hospital procedure.

Kevin Holmes (29:11)
Yeah.

Eric Berry (29:15)
⁓ yeah. So there's like providing care itself. So can you use AI to improve how care itself is delivered while you're actually using it? You know, like that means delivering care. and so are there ways to deliver care with AI? Are there ways to, you know, use AI in conjunction with other technologies to improve?

Kevin Holmes (29:15)
Interesting.

Eric Berry (29:41)
outcomes. And so we have ⁓ a company that combines AI with quantum physics to improve models of how proteins are folded and more. And these are, again, really complex, somewhat narrow niches, but not just AI, deep domain expertise, and a little bit out the wheelhouse of what we think a frontier model can do.

Kevin Holmes (30:03)
And these are companies you've backed or these are companies you want to back?

Eric Berry (30:06)
These are everything I've referenced are both comfort feedback and companies we're looking to back.

Kevin Holmes (30:10)
Yeah.

That's cool. So this is the sort of thesis of Averin. And I guess you're getting a little bit more meaning out of it. That's one of the takeaways as well, because it feels more impactful. Yeah.

Eric Berry (30:25)
Yeah, I mean, it's like a great

place for me. Not to brag, but which is I feel great because there's like, oh, I think it's not 100 % impossible, but it's like really hard for a startup in the healthcare space to be good and successful and like.

net negative for society. I think there were some like cerebral or whatever may have been one, but by and some of these like compounding pharmacies and like, you know, whatever, but by and large, they're pretty good. And

Kevin Holmes (31:02)
Yeah.

Purdue is it one of some of these? Yeah.

Eric Berry (31:05)
Yeah.

By and large. And that said, it's also a great place to make money. And so it's a great place. Like I love the work. There's so much. It's really interesting. You learn about the like.

Kevin Holmes (31:08)
Hahaha

Yeah.

Eric Berry (31:19)
immune system and you spend time and like how does immunology work and it's just one of the most fascinating things and like there's an infinite amount you can learn about health care and the human body and you know how it all works so there's always something to learn so it's intellectually stimulating it there's you do good and you can make money

Kevin Holmes (31:23)
Yeah.

really cool. it's, yeah, it sounds like a through line is learning and interesting problems for you, for your career. And I wonder now that you're on the other side of the table, do you have a perspective? I know you do, because I've read some of your posts recently, but a perspective for founders now that you wish you would have had then that now that you're investing, it's kind of clear that, I don't know, you're doing it wrong. Like there's a better way to fundraise that's, you know, I wish more founders knew this, that kind of message.

Eric Berry (32:06)
Well, I don't know that I know the best way to fundraise. Like, I didn't raise a lot of money, so you could argue I was pretty bad at it. But, yeah, I mean.

Kevin Holmes (32:14)
But people

are coming to you for money now, right?

Eric Berry (32:17)
Yeah, but I mean, guess there's there's like

At the end of the day, there is the case that not everybody understands what VCs need to do. And that's something that founders do need to understand, which is like, by and large, a VC firm needs to get a VC style outcome. And you need to make it clear how you're going to get there.

Kevin Holmes (32:30)
Yeah.

Eric Berry (32:42)
and what that looks like and why you're well positioned to do it. also, a good VC is, a good founder and a good VC are content to work together. It becomes a partnership. And so both sides have to try to get along in those...

early meetings and both sides should try to not be dicks to the other. you know, I think I see a lot of founders and there's some like, let's say accelerators and whatever that have promoted this idea that

all capital is equal and you should sort of just treat VCs as commodities and just get whoever is the cheapest and most available capital. for some founders, that's probably right. At the end of the day though, like you have to work together for the next, you know, six to 12 years or something. And

Kevin Holmes (33:23)
Mm-hmm.

Eric Berry (33:35)
you want to get started on the right foot and figure out who's going to be the right person to start with and work with. And I don't think that's always part of the consideration set.

Kevin Holmes (33:45)
When you reflect

on your experience with Triple Lift, did you work like that with your investors? Did you partner with them and what were... No, yeah, yeah. I see a distribution with our portfolio at FN Fund. Like some people lean on me, some people are content to just kind of go execute on their own. What are your thoughts on that?

Eric Berry (34:04)
Yeah, I mean, I guess I'm being a little hypocritical.

Kevin Holmes (34:07)
I mean, I'm sure you work with founders you've invested in who are leaning on you, right? And you guys, you mentioned like some funds maybe are commodity, but you're in health. like, are definitely, you know, there's knowledge there and connections there in that sector that are hard to navigate that you guys bring to the table.

Eric Berry (34:26)
I'll also say that our approach very much depends on the performance of the company, which is the more, and people should kind of understand, founders need to understand this too, which is like, if you're doing really well, then a VC is going to give you a lot more leash to go off and do it. And I want to help, but I don't want to get in your way.

Kevin Holmes (34:48)
Get in the way,

huh?

Eric Berry (34:49)
⁓ Whereas if things are not going well, then maybe we start to talk more. ⁓ That is at some level...

Kevin Holmes (34:55)
Yeah.

Eric Berry (34:58)
the inverse of how things really should be. And we try pretty hard as a firm to not be like that, which is to say the best companies, the companies that are performing the best for a VC firm are generally going to be the ones that return the most for a VC firm. And so you really actually want to spend the most time that you can helping them however you can. And the companies that are going sideways, Hey, maybe, maybe you turn around a little bit, but that's not going to be the

fund returner. That's going to be something that has a decent marginal return, but not super impactful in the grand scheme of things.

Kevin Holmes (35:27)
the answer.

Yeah.

I've seen, and I'm sure you have as well, but like in your, in your fund, in your portfolio, some outliers on the positive side, the negative side, and then the fat middle. And it's very clear very quickly who's on the positive end of the bell curve. I'm surprised by the companies that have

shut down quickly. It kind of goes back to like, what I'm really fascinated about your story and your approach to entrepreneurship is this missionary versus mercenary or mercenary is kind of a derog a derogatory term for it. But it's like, there's like a serial entrepreneur mindset of like, you don't want to be too married to the idea. You want to be looking for opportunity and exponential growth and trying to find that in

And that's really your job as an entrepreneur for a VC backed startup, right? I think like I firmly believe in supporting all entrepreneurship, all founders, that's what Founders Network is about. But for a VC backed, the founder has to be looking for that, you know, proverbial hockey stick and opportunities that can scale like that. And that's what the fund returners are for the VC.

Eric Berry (36:41)
Yeah. It's funny.

When we were interviewing for the accelerator where my triple lift got started, which was originally called Sintra fides. And one of the reasons we changed the name of the firm, my old company so quickly from Sintra fides is that our lawyer kept misspelling it. We were like, man, if our lawyer job is to like have attention to detail, can't spell it right. Or just his name is DOA.

⁓

Kevin Holmes (37:08)
Couldn't figure out how you had such a good deal with your lawyer,

Eric Berry (37:11)
Yeah, our lawyer was free. It was free for a while and we even still changed law firms. yeah, so in the interview process, it was me and this other guy and we...

Kevin Holmes (37:11)
Go!

Eric Berry (37:29)
we're talking about the founding idea of the business, which admittedly was pretty dumb. And they were like, if the market gives you negative feedback on this idea, what are you going to do? And I honestly didn't know if they were driving towards a missionary or mercenary persona. And from that question and not knowing what...

Kevin Holmes (37:44)
Mmm. Mmm.

Eric Berry (37:49)
kind of founder they liked to back, I was in a tough spot. And so I can make this long and rambling answer that basically was both, you know? And obviously they didn't like that, but whatever, we still got in. So they liked it enough, but it turned out like, they told us later, we were like a team bet, not a, not an idea bet. And they actually thought our idea was pretty dumb.

Kevin Holmes (37:53)
Mm.

Yeah.

Yeah.

Eric Berry (38:15)
And so we were very much the like, I don't know, I don't know if in your system you call that a mercenary, but yeah, that was really.

Kevin Holmes (38:27)
There's got

to be, we need to come up with a better term for it. And I think it needs, like more definition for the ecosystem and for founders to kind of self identify as one or the other, because it's not necessarily a negative thing. And, and like, yeah, it does. Yeah.

Eric Berry (38:40)
Yeah, mercenary is a negative connotation, but ⁓

that's, we were whatever you're getting at. Yeah.

Kevin Holmes (38:50)
Yeah, that thing, yeah. You

were smart, you were pedigreed, you went to MIT. Like, pre-seed investing is about the founder and the founder is going to figure out if the idea is stupid or not, right? And it sounds like you were very scientific about that. And you weren't like too attached to, you know, to a single idea, which, you know, that's another way to think about it, scientific.

Eric Berry (39:10)
Yeah, well, I mean, it's also the case that an early stage VC is investing in a different set of things than a late stage VC and they have to weight it accordingly. So if you're an early stage VC, got to weight the team a lot and the idea much less. And you got to, you know, you're also going to be asking yourself the question of like, well,

Kevin Holmes (39:17)
Mm. Mm. ⁓

Eric Berry (39:30)
what industry are these guys going to be working in? Are these people, and are they like cut out to do it? And also are they like, you know, going to figure something, something in that space versus if you're doing the series B, you're asking a different set of questions.

Kevin Holmes (39:43)
So backing team, did your, what do you think they saw in you and maybe your co-founders? did you, when you reflect back on it, ⁓ it was your hair, yeah, yeah.

Eric Berry (39:50)
There's my hair, they really like my hair. I

don't know, it's funny. And.

Kevin Holmes (39:58)
This guy has to be successful.

Yeah, so like, I don't know, maybe behind my question is like, I've seen some other teams fail, failure mode is the co-founder split and they're like not as committed, even though it's let's call it scientific and not like missionary purpose driven. And so you're not married to the idea. So maybe they're not committed to this, but did you and your co-founders have a durable?

know, relationship that came across at that stage to the investors.

Eric Berry (40:22)
At least that came across. Good. mean, you know, like we never really split up. So I think there's always like a little bit of tension with co-founders from time to time. And we were certainly no exception, but by and large, we took pains to find our swim lanes. know, I think each, well.

Kevin Holmes (40:24)
Yeah. How did it work out?

So that's, Yeah.

Eric Berry (40:46)
My two co-founders had generational talents in certain things. And the more mature we got as a company, I think the more mature I got in making sure that they were spending their time in specifically those things, which they were a general generational talent at and not anything but that. And

That was really, and that, you I spent a lot of time talking to them about like, what are your career aspirations? And other than like having my job, like, what do you want to be doing? And.

How can we set you up to do that? And I think if you're having those conversations with your co-founders about like what makes them happy and so forth, that goes a long way. Differences in strategy ideas and so forth are harder to reconcile out of the gate. But we also did things like hire third party strategy consultants to work with us on how to evaluate the merits of different,

approaches. So things were never really devolving to us just yelling at each other.

Kevin Holmes (41:51)
Hmm. So that might be a takeaway is like really investing in the, in the communication structure or something. know you, you guys at Triplelift had best places to work award and do you, do you, what?

Eric Berry (42:04)
Yeah, we want

that like all the time. ⁓

Kevin Holmes (42:06)
What were

you doing? How did you, mean, that's a great, I mean, now it's the solo five coding founder, billion dollar unicorn. So maybe it's not relevant anymore, but retention, like talent retention is important, right? So what were you doing there to get people to join and do their best work and that sort of thing?

Eric Berry (42:23)
I mean, a lot of those same ideas, which were like, I mean, at different points in a company's journey, different sorts of things work. But at the end of the day, I think what's important is people want clarity. People don't want bullshit. People want good communication and they want to know why they're doing what.

they're doing. They want to feel like they're part of it. They want to feel like there's upside for them personally. And they want to enjoy coming to work. so, you know, I think having a leadership team that has a certain disposition is helpful, which is just like, you know, you're either dicks or you're not dicks. And that kind of like starts at the top and flows down. And if people think the culture is like full of dicks, then it's probably the senior leadership. And if you don't tolerate that as

as amongst your executive team, that flows down, right? I think that's really important. You know, we do the baseline, we did the baseline snacks and all that stuff, and we a really serious focus on snacks. had goofiness, so I tell a lot of, I used to tell stupid jokes and are like, and I would like to make a whole point if I get, I know this is stupid.

Kevin Holmes (43:20)
Yeah.

What

like what like what do you got me in your back pocket?

Eric Berry (43:36)
yeah, what's orange and sounds like a parrot.

Kevin Holmes (43:40)
Orange and sounds like a parrot. Carrot?

Eric Berry (43:43)
That's That's pretty good. Don't pretend like you didn't know the answer to that. ⁓ That was great acting, though. Kevin gets the Oscar. ⁓

Kevin Holmes (43:47)
You

Thank you. Thank you.

But like that's, I've been in environments where the executives kind of had this power distance and you didn't feel like you're working your butt off for this company and it's not for the pay, right? And a lot of people choose to join startups for the camaraderie, right? So it sounds like that was a focus, like creating that environment where people felt connected to you. They had access to you. They could influence you.

Eric Berry (44:18)
Yeah, I used to have for a long time. had, well, early I had one-on-ones with every new employee. Then, you know, we had too many new employees and I started having like lunches with like, you know, groups of new employees and I was always there. was like, just, you know, I think I might.

just by nature, kind of like accessible. So maybe I wish I could be more intimidating, but people are not discriminated. ⁓

Kevin Holmes (44:39)
Yeah.

Yeah. You're two.

I mean, you're one of the most successful guys I know. You're one of the smartest people I know. And you're the most one of the most humble, think, and self-deprecating. But like your hair comment, which, by the way, I should have said, you know, you had a full head of hair before you started doing a startup. That's the that's the that's the truth of it. Did stress and that we were kind of at a stopping point, a good stopping point here ⁓ talking about your hair.

Eric Berry (45:00)
Yeah.

Yeah.

Kevin Holmes (45:08)
⁓ So, Eric, this was fun. Thank you for sharing your experience and I hope people got something out of it. yeah, I always enjoy it.

Eric Berry (45:15)
It's always a pleasure to talk to you, Kevin.

All right, it was a pleasure. Thank you. All right, see you. Bye-bye.

Kevin Holmes (45:22)
Yeah, thanks man. Good to see you. Thank you. All right, bye.