Innovative venture strategies, Zymergen's implosion, Square acquires Afterpay, future of fintech & more

The recording opens with jokes: one speaker describes a sunscreen-covered acquaintance at a beach club and says he made him leave his phone behind during a walk. The hosts then introduce the show with a quip about who is not in Italy, and place themselves in different settings: a boat, an apartment in Florence, a countryside hideaway and a room with abstract art. One speaker says he has left San Francisco after 20 years for an unnamed spot elsewhere in California, with a passing joke about people trying to break into his car.

A co-host is welcomed back after a week off. He says he had hoped his absence would let him quietly leave the cast, but he is back, and he admits he had never listened to the podcast before last week, only taping it. By his account he found it entertaining, more for the conversational feel than for individual points, and the others tease him for complaining about the topics without listening.

The returning host explains why he went public with his holding company, The Production Board (TPB). By his account he has run it for a little over four years as his main vehicle for incubating businesses and making investments from its balance sheet. He says the main reason for the press was recruiting: he wants strong people to know about the work. He also revealed five incubated businesses, several previously in stealth, including a molecular beverage printing company called Cana that is only now emerging after years of R&D.

Asked how the story was placed, he says a mutual contact introduced him to a CNBC reporter. He skipped a broad PR push; his own blog post was the primary content and the article was meant to point readers to it. Another speaker adds that the reporter has appeared on his show and recalls how journalists at CNBC would buttonhole guests for stories.

On the roughly $300 million round, he says that when he started he used his own money, then had dinners and conversations with Larry Page about doing something together with Alphabet. He did not want to run a fund or work at Alphabet, so he set up a permanent holding company with its own balance sheet. Alphabet put cash in four years ago, became a minority shareholder and took a board seat. Per his account, the latest round was co-led by BlackRock, with other institutional investors named, and Alphabet added more. These are his statements and the investor list is as heard in an ASR transcript, so some names may be garbled.

He argues the capital lets TPB support hard deep-tech businesses without rushing to raise venture money or being tempted to inflate marks, backing them until they are commercial or ready for outside capital where that makes sense.

One host asks about the studio model, noting that few studios, such as Idealab and Betaworks, have worked. A second host replies that the term means different things to different people. What he believes in is hyper-focus: in his view Idealab fit a prototypical web 1.0 business and Betaworks a web 2.0 social one, and both worked because their founders were experts in those areas.

He is bullish on the focus on synthetic biology. Investors committing hundreds of millions do not want exposure that looks like nine other things in their portfolio, he says, and a founder who stays in one lane is easier to place within a wider portfolio. This is his opinion rather than a tested claim.

The TPB founder responds that a studio is not about how many companies are cranked out, as he characterizes the Y Combinator model. For him it is about absolute value creation, which could mean one business or several. He says TPB reserves a sizable share of each business's equity for the team so they act like owners, while TPB starts as majority owner and is diluted as outside investors join.

He adds that TPB often keeps funding businesses itself and remains majority owner, but gives each an independent board and shared infrastructure: finance, HR, legal, facilities, recruiting, plus templates and playbooks. He calls this its platform value.

A host notes that one of the others is an investor in TPB and exited a round ago, joking it is another unicorn for him. The conversation then turns to another host who announced closing a third fund of about $1.1 billion, focused on marketplaces and SaaS. Asked how long the raise took, he gives earlier fund sizes as roughly $350 million and $510 million, and says this one is $1.12 billion.

The fund's host says the raise splits into roughly $612 million for venture (Series A and B) and $510 million for growth, though his figures sound inconsistent in the transcript, so treat them as his stated numbers. He runs the SaaS practice with a thesis unchanged since his earlier company: apply consumer growth tactics to enterprise software, let it spread virally inside companies, and sell bottom-up through ordinary employees instead of top-down through the CIO.

The other general partner, named in the transcript as Jeff Flor (an ASR spelling), leads marketplaces; the host describes him as founder and CEO of StubHub. In his view SaaS and marketplaces are the best kinds of internet business to build, and that focus is enough for the fund.