Podcasts are becoming big business -- in part because of how well they can attract and keep audiences at a time when so many other media formats are finding it hard to pin down that elusive metric of engagement. Now a podcast host who has built out a popular series around the world of startup investing is leveraging that growth to build out an investment vehicle of his own. Harry Stebbings, the 24-year-old London-based creator and host of The Twenty Minute VC, is launching a micro VC fund of $8.3 million. Called 20VC, the plan is to invest in U.S. startups across various stages alongside "tier 1" co-investors.
Stebbings spends a lot of his time talking to investors and about investments, and this is his second foray into actually putting money where his mouth is. He's also a partner at Stride.vc, a firm he co-founded with Fred Destin in 2018 (joined later by a third partner, Pia d'Iribarne). He says that 20VC is scratching a different itch. The older fund focuses on investing in the U.K. and France, and has an inclination (but not exclusivity) toward e-commerce disruptors and earlier stages of investment.
Stebbings' newer effort, on the other hand, focuses on the U.S., and is positioned within what seems to be shaping up to be a typical micro fund profile. Micro funds, as the name implies, are usually not huge, but they aim to pack a punch by offering other skills in the mix with their smaller investments. The concept has been growing in popularity over the last several years. ("I don't know anyone who isn't involved in at least one $5 million micro fund," one former VC said to me.)
In the case of 20VC, it hopes to get its foot in the door on deals of other VCs by offering Stebbings' own set of skills in building and scaling companies as the selling point in exchange.
Typical deal sizes will range from $100,000 to $300,000 ($250,000 is the typical check size), and although Stebbings is announcing the fund today, some 12 investments have already been made out of it (Nex Health and Spiketrap are the only two that are public so far), investing alongside Sequoia, Index, Founders Fund and a16z.
20VC's tie to the name of the podcast is intentional. The podcast has developed a brand of its own in the world of tech, with some 200,000 subscribers and 80 million downloads to date of the twice-weekly program. And 20VC isn't just trading on Stebbings' own experience as an entrepreneur: it has tapped the network of people that have been on the show, or know him because of the show, to assemble LPs.
There are some 64 of them in all, including founders and current and former execs from Atlassian, Yammer (David Sacks), Plaid (William Hockney), Superhuman, Airtable, Calm, Cazoo, Zenly, Alan, Spotify (Shakil Khan) and Tray.io; GPs from Kleiner (Mamoon Hamid), Social Capital (Chamath) Thrive (Josh Kushner & Miles Grimshaw), Atomic, Founders Fund (Brian Singerman), Coatue, Index (Danny Rimer), True Ventures (Phil Black) and Beezer Clarkson, among many others. Having a popular podcast that highlights interesting investors and startups turns out to be a good way of networking to build a fund. Stebbings said that the call out was oversubscribed three times over within four weeks.
Stebbings' entry into the world of investing in startups is something of a typical startup story of its own.
He came up with the idea for his podcast at a time when he was already intrigued by the world of venture capital, but was actually on the road to something else, with a place as a law scholar at Kings College in London (in the U.K. you start law school as an undergraduate).
He says he started the podcast with the idea of working on something that interested him, but more specifically to make some money. His mother has multiple sclerosis and she was having issues paying for her healthcare. Stebbings decided to start the podcast to use the money it made off advertising to help cover his mother's medical bills.
He was a nobody in tech, but he had a very specific plan, and a lot of smiley and positive enthusiasm, for how to get from zero to hero.
It started with finding just the right first guest, someone who had a high profile and respect but also appeared to be nice enough that if you got the approach right, you might get an agreement to be interviewed, or as Stebbings described it, "low-hanging fruit."
For Stebbings, that person, it turned out, was Guy Kawasaki. In addition to getting the interview, Stebbings also asked Kawasaki for three recommendations of people he should have on the show next, and what he should ask them. Stebbings followed that up with asking those three for their recommendations, and so on. Pyramid scheme with purpose, I guess you could say.
"I view distribution quite scientifically," said Stebbings -- who I interviewed sitting in a bedroom, although I think he normally podcasts these days sitting in a studio as pictured, above. "I’m bringing as many people as possible to help in the content creation process."
The whole format of "20 minutes" also stemmed from a calculation Stebbings made. He told me he used to struggle with his weight and finally managed to lose some pounds using Tim Ferriss' 4-hour Body. It got him thinking about how timing is important, and on top of that he knew that the typical commute in London was around 30 minutes, and decided that 20 minutes was a reasonable amount of time to expect someone to listen regularly. (Spoiler: Most of the podcasts these days are not 20 minutes, but longer.)
Things started to shift from interesting side hustle to main hustle after he featured Arielle Zuckerberg, Mark's sister and a tech persona in her own right (she's currently a partner at investment firm Coatue). That podcast saw 100,000 downloads, and all signs pointed to The Twenty Minute VC taking off. So he quit university to focus on the podcast full time. It was four weeks into his first term.
"I decided I love VC and all of this," he said about his choice to drop out of school. "I decided that I’d rather have my shot at this than trying to live the life I didn’t want to live. It was a big decision. I was 18 and very unemployable at the time."
As for his mother's medical bills, they are still being paid for by the show, he said.
"There's advertising at the beginning and end of the show. It's fine, not lights out, but it pays for my mother's healthcare and that’s all I need it to do."
The show, and Stebbings himself, have benefited from a perfect storm of circumstances to grow.
Podcasts have been around for years, but it's only been in recent times that they have properly taken off in popularity. Leveraging mobile phones and apps for listening, they fit naturally into our multitasking, information-hungry routines; there is a huge variety out there, a podcast for every taste; and they've bettered the talk radio format by being there right when you need them. Having a very predictable program in that format -- Stebbings' show has been running twice a week, every week, for five years now -- is not to be underestimated.
There is also the subject matter to consider. There has been a huge explosion in the role that technology is playing in our modern society and economy, and that has meant an audience that consists not just of those already working in the world of tech, but those with ambitions to be a part of it (like Stebbings himself), and simply a lot of enthusiasts.
Within that, venture capital has seen a veritable explosion of money, and while some believe that it's the technical talent that fuels the startup engine, others would make a strong case for the funding that enables them to work holding that role. In any case, money has always held a lot of allure.
"VC is becoming more popular, and cool, and I think that had a lot to do with us getting to this size," he said.
Stebbings himself is also a part of the formula. He's not a journalist, and at a time when we seem to be seeing a lot of wariness and tension in the relationship between media and the tech industry, his position as an informal reporter and conduit of information and messaging, who remains friendly and non-combative with his guests, may see him getting a lot warmer of a reception from his target audience of guests and listeners.
Harry doesn't seem to remember this, but I first met him several years ago, at a tech event in London, where he was working the room very smoothly, smiling and chatting and knowing enough people already that he was able to continue the momentum introducing himself and presuming familiarity with those he was just meeting for the first time. I remember being struck at the time by how young he was, mingling amongst quite a lot of middle-aged types.
When I recalled this and asked Stebbings if he ever felt like he's found a place in this scene precisely for this reason -- being around younger and flattering people sometimes makes older people feel less old, and possibly more important -- he said he thought it was more that it's about himself feeling natural in that environment.
"For me, it's always about building relationships," he said. "I was always like the 50-year-old in the room when I was younger and I didn't have many friends. I've made by best friends through the shows."
Ironically, he says that these days he does get pinged by his older -- that is, young and past -- acquaintances who are hoping for connections to his powerful network to push whatever tech enterprise they are pursuing these days.
That's not the only bit of irony in 20VC and Stebbings' latest venture: the whole of his podcast was built from the ground up, funded by ads and not a penny of outside investment. It means that the lesson from Stebbings is not just how to grow and scale, but how to do so with no VC involvement at all.
That's not the norm, however, and so this will be about bringing more along that proverbial check.
"Everyone in the valley has money, but very few have been part of an enterprise that has scaled to include contact machines and brands. I'll have thousands of tips and lessons on scaling and customer acquisition costs. It's about the cadence and distribution, and how to build a brand."