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Lightspeed Partner, Alex Taussig — At the Intersection of Fintech and Online Marketplaces

Miguel Armaza sits down with Alex Taussig, Partner at Lightspeed Ventures, a global multi-stage VC with over $10B in AUM, focused on accelerating disruptive innovations and trends in the Enterprise and Consumer sectors. They’ve backed some amazing companies, including Snap, Affirm, and GrubHub.

Alex focuses on online marketplaces and co-leads Lightspeed’s investment efforts in Latin America. He is also the author of the popular weekly newsletter, DRINKING FROM THE FIREHOSE, in which he writes about recent trends in commerce, media, tech, climate, science, and popular culture.

In this episode, we discuss:

Alex’s story and why he decided to stop pursuing a Phd and left academia to join the tech investing world. For as long as he can remember, Alex always wanted to be a scientist. He continued pursuing his scientific curiosity in college and attended Harvard where he majored in physics and later started his PhD in materials engineering at MIT. But during his time at MIT, he realized a life in a laboratory was not for him.

“I remember when the guy who named the Higgs Boson got his Nobel Prize, he was 74, and it just occurred to me that this is going to be a very long path to impact… And at the same time, there were people who I went to college with, who had gone on to start Facebook or they were all having these very fast rocketship careers, and they seemed to be having a lot more impact than I was working in a laboratory.”

The intersection of marketplaces and fintech and why payment technology is the motor oil that makes transactions flow smoothly. Mr. Taussig is an expert marketplace investor and recognizes the importance of fintech in every single one of his companies. He explains that the key ingredient in a marketplace is liquidity, but if you can’t easily make a transaction, that liquidity is not as valuable — which is why having excellent payments and fintech capabilities is at the core of marketplaces.

“I wrote this piece titled Payment Tech is Motor Oil… And the point I was trying to make is essentially that the engine is the marketplace, but the thing that lubricates it is financial services and FinTech… because in a marketplace, if you can’t transact with other people then the marketplace just has too much friction and it slows down.”

Why in Venture Capital it’s very important to ask the best possible questions and pay close attention to the answers that reveal an underlying truth.

“Founders should know significantly more than you do as an investor. There is this persistent myth that gets promulgated by these ‘cult of personality’ individuals that VCs are like these truth-sayers that know stuff that other people don’t…. The reality is that if you talk to some of these great investors, they will tell you they actually know very little. And what makes them good is that they just know how to listen really well.”

Early investing mistakes and the importance of focus. Most VCs will admit their biggest mistakes are companies they passed on and that ended up doing really well. Alex is no different, but he’s convinced being extremely focused helps him avoid missing great opportunities. Not only is it important to understand an industry, but it’s also crucial to being able to spot amazing founders. In his experience, the best operators have five similar characteristics:

1. Incredible attention to detail

2. Clarity of vision from a very early stage

3. Amazing communication skills

4. Growth mindset

5. Grit and determination

Lessons from several years of writing a successful newsletter… and a lot more!

Alex Taussig

Alex joined Lightspeed in 2016 as a partner on the consumer investment team and has spent 12+ years in venture capital. He is passionate about partnering with founders who are reimagining major categories of commerce using technology.

At Lightspeed, Alex has led investments in startups disrupting massive industries like food (Daily Harvest, Frubana), retail (Faire), education (Outschool), and weddings (Zola). He also co-leads Lightspeed’s investment efforts in Latin America. Prior to joining Lightspeed, Alex was a partner at Highland Capital Partners, where he led investments in and supported over a dozen companies, including thredUP (IPO TDUP, 2021), Carbon Black (IPO CBLK, 2018), 2U (IPO 2014, TWOU), and RentJuice (acquired by Zillow, 2012).

Alex is a trained research scientist and breaks down business problems with deductive logic and analytical rigor. He originally studied physics at Harvard College, where he graduated summa cum laude, and then went on to receive a Master’s degree in materials engineering from MIT, where he was part of a research group building the first fully optical computer chip. Alex also received an MBA from Harvard Business School, where he was a Baker Scholar, an honor given to the top 5% of the graduating class.

Alex publishes a popular weekly(ish) newsletter called DRINKING FROM THE FIREHOSE, in which he writes about recent trends in commerce, media, tech, climate, science, and popular culture. He lives in San Francisco with his wife and two children and enjoys baking, anime, and heavy metal music.

Full interview → Spotify | Soundcloud | Apple

About Lightspeed Venture Partners

Lightspeed Venture Partners is a multi-stage venture capital firm focused on accelerating disruptive innovations and trends in the Enterprise and Consumer sectors. Over the past two decades, the Lightspeed team has backed hundreds of entrepreneurs and helped build more than 400 companies globally, including Snap, Nest, Nutanix, AppDynamics, MuleSoft, OYO, Guardant, Affirm, and GrubHub. Lightspeed and its affiliates currently manage $10.5B across the global Lightspeed platform, with investment professionals and advisors in Silicon Valley, Israel, India, China, Southeast Asia, and Europe.

Previous Episodes You May Enjoy:

Fabrice Grinda, Founding Partner at FJ Labs — Serial Entrepreneur & Investor in 700 Startups!

Sallie Krawcheck, Co-founder/CEO of Ellevest — Wall Street Stories, Building Resilience, & Overcoming Bias

SoftBank International CEO Marcelo Claure — Investing, Dreaming Big, and the Golden Era of Entrepreneurship!

Revolutionizing Working Capital Financing — Sandy Kemper, Founder & CEO of C2FO

Anish Acharya, General Partner at Andreessen Horowitz — Doubling Down on Fintech

Building Unicorns and Redefining Online Banking — Renaud Laplanche, Upgrade CEO/Co-Founder

Building Big Things and Moving Fast — Allison Barr Allen, Co-Founder/COO at Fast

Jackie Reses — Leadership Lessons, Fintech Innovation, & Helping Small Businesses

Entrepreneurship Lessons with Brian Requarth, Co-Founder of VivaReal & Latitud

Miguel Armaza is Co-Host of the Wharton Fintech Podcast and Co-Founder of Gilgamesh Ventures, a seed-stage investment fund focused on fintech in the Americas.

For more FinTech insights, follow us below:

Wharton Fintech

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Miguel Armaza

Twitter | LinkedIn | Substack

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Miguel Armaza

Miguel Armaza

🎙Co-President/Podcast Host @WhartonFintech. Fintech investor @ Gilgamesh. 📚MBA/MA Candidate @Wharton/@LauderInstitute. Author of Fintech Leaders Newsletter✍️

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