The Pomp Podcast - How To Invest In OpenAI and Anthropic Before They Go Public | Ankur Nagpal

Episode Date: July 7, 2026

Ankur Nagpal is the GP of USVC, a publicly accessible venture capital fund. In this conversation, we break down how retail investors can now access private markets like OpenAI, Anthropic, and SpaceX for as little as $500, and the controversy around USVC's Anduril investment, portfolio strategy, QSBS, tax alpha, and what it means to build wealth in America. ====================Looking for a better place to trade? BloFin gives traders access to deep liquidity, advanced futures products for crypto AND TradFi assets, fast execution, and a clean, intuitive interface—all in one platform. To celebrate their partnership with us, they're giving away $100,000 in Deposit & Trade Rewards. Deposit, trade, and earn rewards based on your activity during the campaign. Check them out at (https://partner.blofin.com/d/Pomp).====================BitcoinIRA: Save up to 37% in capital gains taxes on your retirement investments. Take 3 minutes to open your account & get connected to a team of IRA specialists that will guide you through every step of the process. Go to lp.bitcoinira.com/after-crypto to win up to $4,000 in rewards.====================Arch Public is an agentic trading platform that automates the buying and selling of your preferred crypto strategies. Sign up today at https://www.archpublic.com and start your automated trading strategy for free. No catch. No hidden fees. Just smarter trading.====================0:00 - Intro1:07 - The case for & against private market investing9:27 - Inside USVC's fund structure (open to anyone with $500)12:59 - What's in the USVC portfolio right now14:44 - The Anduril SPV controversy explained19:38 - Buying out LP stakes in venture funds23:42 - Private markets vs S&P25:34 - Lessons from AngelList's data on portfolio construction 30:44 - Why AI is no longer just a category & due diligence 34:16 - Biggest risks & tax alpha with USVC39:22 - Sticking to the plan amid market change40:43 - Working with Naval and what America means to Ankur

My hot take is one of the many reasons that the general public doesn't love AI is they're not benefiting from any of the economic boon it's given, right? Like, who are the people who love AI? The venture capitalists, people getting paid really high salaries. The average American is fully locked out of that wealth creation. And I think the companies are realizing that they're like, OK, fine, if I can give the average American some piece of that wealth creation, they'll start feeling more favorably towards it. What's going on, guys? Today, we have a great conversation with Ankur Nagpal. He is the GP of USVC. And we talk about the state of private markets, whether you should invest in private markets, what are the pros, the cons, how you

should allocate your capital in your portfolio. And then we talk about USVC, which is a brand new type of public access venture capital fund. It gives people exposure to private markets, but it does so in a somewhat liquid format. So we talk about what are the risks? What are the advantages? And how should you actually think about this type of asset in your portfolio? This conversation is wide ranging because we talk about different themes in private markets, what some of the risks are. We even go over a controversy that recently USVC caught themselves in. And I think that you're going to find this conversation very, very interesting. Here's my latest conversation with Ankur Nagpal. All right, let's talk through private market

investing. I can make a very strong argument that it is not worth investing in private markets anymore. I also think I can make an argument that it is worth doing. And I think that's part of the controversy as to what people are trying to figure out here. Let's start with maybe the argument as to why people are saying it's not worth investing. I know a lot of friends who do angel investing, they're like, somehow I've lost all the money. It's like the best way to go broke is just keep giving money to people who are trying to build something that's nearly impossible. It doesn't work. The second thing is a math argument. So I think the average venture fund is reported to be like 17, 18% return. If you look at the NASDAQ historically over the last decade or so, it's

somewhere in the like 12 to 13% range, depending on the exact dates. Okay. So if you get 400 basis points of outperformance or so, then I think a lot of people say it's worth locking up your capital, but as the NASDAQ has done much better and the venture funds, people are trying to figure out how much of those paper marks are real or not. Maybe the outperformance is really like 100 basis points. And maybe that's not worth me locking up my capital. So how are you thinking about the argument for people to invest in private markets right now? Yeah, so I think private market investing is one, I don't think everyone should invest in private markets. I think private market investing is something you do when you kind of have your

index funds, you have, you know, the majority of your portfolio locked in. Personally, I'm very irresponsible. I have more than half my money in private markets. I do not think people should do that. So I totally with that. But I think as you think about you're building a legitimate portfolio within that, owning 100% index funds or whatever, a certain point starts to feel a bit irresponsible because you're fully kind of hedged with how the market is. And while the market goes well, you don't have that many opportunities to have asymmetric bets, right? Again, Bitcoin back in the day was an asymmetric bet. And I think if you can afford it, if you have 70, 80, 90% indexing the market, you can afford to take asymmetric bets with the leftover 10, 15, 20%.

And that's where I think private markets can come in because so much of the compounding of wealth in America lately happens in private markets. Companies are staying private longer. On average, the number of public companies in America has fallen by half. Companies are going public on average after 13 years, and all of that wealth is being built in private markets. One of the things that cracks me up right now is the large language model labs. They're all talking about giving 5% of their equity to the government and the promises that it's going to go to the American people. But that's kind of just like, go public. If you were just a public company, then anyone could go buy it and we wouldn't have this issue. So in a weird way,

this like nationalized control or nationalized interest for the American people is actually a exhaust of the fact that the companies aren't public to begin with. My hot take is one of the many reasons that the general public doesn't love AI is they're not benefiting from any of the economic boon it's given, right? Like, who are the people who love AI? The venture capitalists, people getting paid really high salaries. The average American is fully locked out of that wealth creation. And then I think the companies are realizing that. They're like, okay, fine. If I can give the average American some piece of that wealth creation, they'll start feeling more favorably towards it.

Why do you think they don't want to go public? Is it just like, it's not the cost, right? I think it's literally just like you have such insane product market fit that like, yes, you want to do it and you're just scrambling to get your shit together. Like all things considered, if Anthropic failed to go public, if they go public later this year, which is very likely, this would make them one of the fastest companies in recent history to go public. So I do think they're actually could be going public sooner than expected. But I don't know, like I was involved with a startup that we tried to go public. And I mean, you've done that.

The filings are regulatory. You have to get your house in order. That takes time. And I also do wonder how much when you're growing this quickly, how much of the controls do you have in place? And, you know, it sounds stupid, but you have to be able to count the money, right? And people forget like you're booking revenue. Then you've got churn.

Then you've got people who are looking for refunds. And all this stuff is like pretty simple now that you have a bunch of these tools like Stripe, whatever, but not when it comes to the auditors then want to come in and take a look at it. Like you can innovate as fast as you want with AI, but when you have to deal with regulated businesses, you're only as fast as a regulation. So I think the IPO market is similar, but I do suspect there's a very high probability we will see at least one of the frontier labs going out later this year.

And do you think that if one goes, they all have to go? Or do you think actually this is like maybe a diversification of strategy where some will say we're going to be the first to go? And so there's going to be an advantage to doing that. Somebody else will say. I think there's a benefit to going first. However, whoever goes second will very closely watch what happens to the first one. Yeah, that makes sense. All right.

So in the private market investing, one of the things I think is also true is if you go and you talk to like the doctor or lawyer, right, the quintessential person who gave $50,000 to somebody down the street. they meet some young kid in the middle of, I don't know, Missouri or Iowa, and this kid promises they're going to build some cool piece of technology and it doesn't work. All of a sudden, they're like, well, maybe Steve Jobs wasn't sitting in, you know, Iowa, right? And no disrespect to the people of Iowa, but just like you can go state by state across the United States. It's just very unlikely. The odds are they're in one of these major centers. And so talk about, you know, finding these opportunities, accessing these opportunities and like how much of it is an insider's game? Yeah. So I do think on average, like if you look at the average American person,

If they're investing in private markets, they effectively get adverse selection, unless they are, you know, living in San Francisco, working in tech and plugged into very specific communities by default to getting adverse selection because it's their friend's kid who's starting a company or, you know, something like that. So I do think the way America is run right now is you have these cities that are magnets for talent. It's not that kids born in San Francisco are necessarily any smarter. It's more that the kids that are the cream of the crop from the kids from Iowa, where will they move? They'll move to San Francisco. They'll move to New York.

So as a result, a lot of the innovation happens there. However, now when it comes to designing a good portfolio for venture capital, it is a pretty unforgiving asset class if you start picking individual companies, right? Like, yes, it can work out super well, but you and I both invest. The way this asset class works is you have one or two winners that pay for the entire thing. So how you structure the portfolio becomes quite important. So recently, my business was acquired by AngelList. AngelList is an investing platform. They now have about 13, 14 years of data. And the data clearly shows that the investors on the platform that have a high sample size of deals, most of their IRR congregates anywhere

from 12, 15, 20%. So 12 to 15% of the deals they do drive almost all of the returns that you're saying? No, no, sorry. Their IRR, their average rate of return across the entire time averages, yeah, 12, 15, somewhere in that range, 20% for the better people. But if you look at the individuals, it's a crapshoot, right? Like there's a lot of people, if you invest in five deals, they can all go to zero. So it is a very different asset class in that if you invest in the S&P, it's not going to go to zero. But if you invest in three companies, there's a very good chance they could all go to zero. If you invest in 300 companies and they're selected relatively well, it's not going to go to zero and you're likely to have a very good IRR.

So really, it's the index type approach, but applying it to the private market versus the public market. That's what you guys are doing. Totally. An index approach while trying to be careful of avoiding sort of, let's call it the worst set of companies, right? Yeah. That's an interesting way to look at it. It's like, are you more focused on getting into the best companies or are you more interested in just avoiding the bad ones and then that takes care of itself? So it's a two-tier strategy. What we do for early stage companies is I can't pick early stage companies. There's too many of them in the world. So there I will pick who I believed to be the best early stage fund managers. They are my brains for anything early stage.

Later stage, I think you can start formulating a viewpoint on individual companies. So later stage, we'll buy individual companies, we'll be innovative in structure, we'll buy out LP stakes from fund investors. There's a lot of things we can do once we have a stance on a specific company, but that won't be till later on. Now, talk a little bit about the fund structure that you've created with USVC. Yeah, so it's a very innovative structure. I should give credit where credit's due. This predates my time at AngelList, but AngelList recruited me, bought my company to run USVC, which is a fully publicly accessible venture fund. This is very, very rare since normally venture funds require someone to be an accredited investor. However, this is open to anyone in America with as little as $500.

So it's a different structure because it is a tender offer fund. Unlike a traditional venture fund where your dollars are locked up indefinitely, here our goal is to give liquidity or offer liquidity every quarter it's not guaranteed it's our goal of up to five percent of the entire fund so investors can buy in at any time at whatever the nav is at the time um and if they want out whenever there's a tender offer ideally every quarter they can be like all right i want out and it is actually at the nav which is the net asset value of what's underneath now can these um maybe differently than like a true closed-end publicly traded fund, can this trade at a premium or discount? Or is that part of this

kind of liquidity on a quarterly basis really is trying to orbit back and keep it there at NAV? Yeah. So that's a really great question because that is the difference. People ask, there's other ETFs, the Broadbenton has one, Fundrise has one that are basically closed end. And the challenge with those is the price at which it trades gets completely distorted from the underlying asset values. Like there was an ETF by this company called Destiny. They, at one point,

they were trading at almost 100 times premium to what's underneath. And I think Morningstar actually had an interesting quote where like, they're like, this buying into this ETF now is the best way

of enriching others at your expense. Because like, it's literally trading at completely divorced prices. Even Robinhood right now is trading at two times NAV. Our structure, it's less liquid than an ETF. You can sell it whenever you want. However, the assets are held at NAV. So what you're buying is actually related to what's underneath. Got it. And now I think the other

piece is a lot of these closed-end structures, when they trade at the premium, these folks are going and they're issuing more shares and they're trying to monetize that premium to be able to get more money to go and invest. For you guys, is there the ability to issue more shares or it doesn't work that way? Yeah. So I mean, effectively what happens is, let's call it our NAV today is 20 bucks and change you buy in there's effectively new shares created every time you buy it and that gives us more dollars to go and invest got it that makes sense today's episode is brought to you by blowfin if you're actively trading crypto then you already know the platform matters execution speed matters liquidity matters and reliability during volatile markets that

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Anthropic. We have OpenAI. We have Sierra, Legora. That was the first basket of companies we launched with. Since then, we've publicly announced investing in Mercury. We've publicly announced investing in Superbase. We've backed a couple of fund managers. So the portfolio is coming along pretty nicely. There's a bunch of stuff in the works that I can't share yet that we'll be sharing in the coming weeks. But it's a good time to be doing this. But something I'm very careful of is private markets are very hot right now. I can't predict if they're going to be very hot 6, 12, 18, 24 months from now. So it's important for me to allocate a reasonable amount of our portfolio in companies that will be big in five years, seven years, 10 years.

So we're taking almost 20% of the portfolio and putting it in brand new funds that will not pay off for quite a while. But I think the bet I have is the companies of the future will always be bigger than the companies of today. And as long as that thesis is true, I hope this portfolio will outperform. Yeah. And how much of that do you think is just like the companies get better, they become more capital efficient, the technology is better, all that versus it's actually like a macroeconomic argument of just the dollars. I think it's innovation. I mean, human intelligence is growing at an exponential rate and shit's getting outdated faster too. There's downsides of this as well. But the cycle is spinning faster and faster. Companies are getting bigger faster.

They also may die faster. We don't know what's going to happen there. But as a result, there's a lot of change and um that's sort of what we're betting on yeah um recently there's this controversy around the andro position talk a little bit just like what happened and kind of what your response maybe is to uh to the folks who are uh yeah absolutely and they um so for people who miss this we bought a stake in andro we did not buy this stake directly from the company um there are things called spvs that people are typically aware of where an spv is a vehicle created to invest in the company. Now, what we did is we bought out specific investors in the SPV. And when that happens, that typically, that does not change the company's cap table. The company

does not have legal jurisdiction on it. It's the same as if a fund invested in a company and the fund changed ownership. However, the part that I think I, in retrospect, should have handled differently and messed up is I publicly posted, hey, we invested in Enduro. And Matt Guram, who's one of the founders and also pretty vocal on Twitter, effectively said, what the fuck, you didn't invest in Enduril. Who are you? What did you buy? And that whole thing blew up and it turned into a little bit of a dispute on both sides, like what is allowed, what is not. I think we will see. So again, my takeaway is I probably should have been clearer in what I communicated publicly, because again, we did eventually buy a stake in Enduril, but it was

by buying out LPs in an SPV. But I think the other thing, yeah, go ahead. I was going to say, like, that I think has been going on for a long time. It's very normal, you know, in the market. I think Andoril as a company has been very protective of their cap table, especially when they don't have,

there's like an opaqueness to who are the investors in these SPVs. And then obviously there's the problem of like an SPV that owns an SPV that owns an SPV that maybe there's somebody who owns it or not. I will say while we were looking at this, we were pitched so many annual SPVs that I couldn't figure out what the hell was underneath. Because again, on AngelList, when there's an SPV, we can see what's underneath,

but the multi-layer SPVs just show another LLC underneath. And there's no way of actually coming to the bottom of that. So even though we bought out LPs in an SPV, it was like an SPV that is on the cap table. And I think that's a very important distinction because with USVC, we have a blanket policy that we're going to not buy SPVs that are invested in other SPVs. And you may think, wow, that's obvious who the hell would do that. But so much of this market is so dirty. I've seen crazy stuff. I've seen one time 10% management fee on SPVs. I've seen crazy double layered, somebody charging 2% and 20%. And then another person comes in and is like, I want a 3% fee. You're just like, who's paying this? And then you realize like,

okay maybe let's say the full fee load yeah on an exposure sometimes could be as much as 10 15 20 depending on how all the math works yep but people are like well i can't get anywhere else i'll pay 20 premium and if i just wait a year like you know i'll still be in the money yeah well the most terrifying part is not that the most terrifying part is sometimes there's nothing underneath yes so it's like just outright fraud then there's forward contracts which are someone promises to sell you their equity but good luck trying to enforce it when someone's just made you know 50 million bucks and you know has a bunch of lawyers i think that's the big question is like are they going to be enforceable these ford contracts we don't know right so which is why

our stance is we just don't play with that and by the way i like again i do i do understand a lot of endural and matt's bigger points like i think we're quite aligned there like i was talking to trey who's also an endural and he was saying he actually once attended a webinar where someone was pitching endural stock and just saying things that were straight up untrue right so there are All these things we're trying to avoid. Because in that situation, just maybe so people understand a little bit more of the inside baseball, there are people who will go out and they will say, hey, I'm going to get exposure to XYZ company.

And they may not be as transparent about, are they actually getting it from the company? Are they getting it from an SPV? Is it an SPV of an SPV? Whatever. But then in order to explain to potential investors, what are you investing in? People know, maybe they've heard of Anduril or SpaceX when it was private, whatever. but a smart investor is still like well what are the numbers yep like is this a good deal or not right i understand what the company is but like show me the numbers but these people who are

pitching they don't have the latest numbers totally so they'll just start it up or well they can make it up or they just like go online and they find some like reported number and they're using that and so if trey or somebody gets on on the webinar and they're like dude are you using like 2021 numbers it's 2025 you know blah blah whatever it's not hard to see a world where like you know this rumor essentially becomes fact in the minds of a bunch of people and it creates a problem for the company totally i tried to control for it as best as i could i sent the company drafts of what we were going to post with a very polite no response necessary i never got a response and assumed it would be fine but yeah we saw how that turned out now um as you guys continue to do

this uh do you think there's a whole business around going and buying out the lp stakes and the spvs and stuff like that totally but it's not just i think so i think if you look at venture investing as a whole there are a ton of people who on paper have done fantastically well but have made very little cash on cash so one part of our strategy is doing exactly that but less so with spvs but with entire venture funds um so one of the ways we're constructing our portfolio is we're going to venture funds that may be marked up quite a bit on paper some of their marks are real some of them are old you know 2021 marks and we will make a competitive offer to their lps saying hey you want to sell your LP stake, you can sell 25%, 50%, 75%. But that's a way we are constructing

our portfolio in somewhat hard to access names at pretty good prices. And what's been the LP response to this? I'm assuming that they are, one, they're interested in liquidity. Do you get pushback from folks who are like, hey, actually, I don't want to participate in this? So there's a lot of pushback. And the pushback very often is they think the marks are worth more than they are Because like you look at this and, but every single time there's, I've never done one of these where at least 10% of the fund has not been willing to transact. And that's all I typically need, right? If 10% of the fund is willing to transact, that's all we really need.

So there's always enough liquidity that comes out. However, yeah, there are some people being like, well, you know, my dashboard says this company I invested in 2021 is worth $6 billion and you've put a big fat zero against it. So that's hard to communicate. But look, we make offers and enough people take them to make our math work. How do you go and underwrite a company that on paper was a $6 billion round, but you think it's a zero? So we're very conservative.

If I'm trying to underwrite buying out a fund LP stake, there'll be one or two prize assets that I'm like, OK, this is really, really good. I'll underwrite that with full value. I'll strike a bunch of zeros. And that's my fund. That's my fund math. And literally, you just take the couple of prize assets. You put a zero on everything.

But that's also why it's conservative underwriting, right? Like I'd rather be conservative and shake out less demand than overpay for a bunch of stuff. And that's really the challenge, right? It's the illiquidity and the lack of mark to market. Totally. Like you have to be conservative. The only way of doing this in a responsible way is giving a literal zero to everything

except the asset you want to buy. One of the aspects of the private market that I think is really just, I've invested in, I've had Andrew Kang from RoboStrategy on, and he's got more of a traditional closed and publicly traded fund all focus on physical AI and robotics. And what I think is interesting there is he's in a sector that as those companies continue to raise more capital and do it at higher valuations, the nav is always struck to the last round. And so physical AI and robotics is a relatively new thing. In 2022, there wasn't that many companies. In 2021, most of them got started in the last, call it four or five years. And so that works in their favor because usually when

you're investing you're investing at old marks and their direction of travel is up right yep if you're going and looking at you know i don't know 2018 2019 2020 maybe even 2021 vintage venture funds there's a lot of companies in there that actually the old marks are on the way down right it would be in my mind irresponsible and potentially fraudulent to like be using 2021 marks to mark the market and anything right correct and so i think that's where you know there just becomes these, again, like arbitrage opportunities or like opaqueness in the market. And what I've been pretty surprised by is we don't actually see that many large hedge funds or those people playing here yet. They did some private investing, but they really haven't gotten into

what is more of like almost a trader's mentality in the private market. Do you expect that to happen at some point? Yeah, that's interesting. I mean, there are people who've tried that with ETFs. For instance, I think one of the ETFs was when it was up 100x NAV, people tried shorting it, but the cost to borrow it was more than 100% of the value. So I think we'll start seeing a little bit more of it. I mean, the financialization of everything is sort of well underway. So I don't think it's that far away. We've seen the S&P double since 2022. That's pretty hard to beat. Insane. Yeah. Right? How do you think about private market performance compared to what people can get? Look, if you told me here, the S&P will keep doubling every four years,

we'd all be out of work, right? Very often, it's not about what happened in the past, but versus what it is going forward. So again, I think one of the best parts about the US is access to American markets. And I think you absolutely should put the majority of your dollars indexing the stock market. Private markets don't replace that. Private markets give a small sleeve on top of that that could potentially outperform. So I think one doesn't replace the other but it forms a part of a balanced portfolio one of the aspects that i always find uh fascinating is when you look at the private markets um you're now starting to get a lot of proxies in the public market so like maybe a good example is we have proxies of public

companies so you know you see uh the dram etf explode fast-growing etf of all time big part of the innovation was just like we're gonna give you access to something that's hard for an american investor to buy okay it makes sense adrs have become incredibly popular uh sk hynix is going to go and list this week um at the same time what you guys are really doing is you're providing access for a proxy for these private markets and so it does feel like the public market is becoming cool again and now people are just trying to figure out all these vehicles to give access to these different kind of themes to invest in yeah i mean look bigger picture my argument is not even like let me convince you to invest in private markets it's

more if you do believe you want a piece of private markets in your portfolio this could be a better product than your cousin's uncle's startup, right? It's really for the people that do, are already, believe private markets have placed in their portfolio. Can we build sort of a blue chip product that does relatively responsible things with their money? I'm an investor in AngelList. I invested probably around 2021. We both did. We both did. We'll see if that was good or not. They've been doing a great job, right? But my thesis was basically, hey, I'm getting an index, right, is these guys have not only directly invested, but also they have carry or whatever on a bunch of these investments. There's $25 billion in assets on the AngelList

platform and compounding at a really fast rate. So $25 billion in assets of which they have some economic stake in across the ecosystem of startups feels like a pretty good thing to own. You guys are now creating this public version of it. What are some of the other things that you guys have seen from the data at AngelList that is helping you with the portfolio construction of USVC? Yeah. So as I mentioned, shots on goal is one of the most important indicators of this entire thing, right? If you invest in four companies, your performance is all over the place. But as you index into more things, your IRR kind of converges to a good place. So that's one super interesting insight. The second thing is when we... Part of my job is to figure out who are the early

fund managers to back. And having access to a wide data set from AngelList is pretty cool since we can build internal measures to come up with prediction scores of who is likely to succeed. So there's some, I think AngelList research put out some paper where typically if you're evaluating an early seed manager, one of the dangers is if you look just at their overall IRR or something, it's so heavily skewed by that one outlier that it doesn't necessarily give you repeatable motion. So they introduced this idea of markups over baseline, which is you look at all the investments they have and figure out how many markups does that cohort get on average and how many markups does this investor get on average. And then you kind of cohort it out and

figure out where they compare. While you do that, you have to still control for people finding the biggest deals as well. So using these quantitative measures, I think we can get pretty sophisticated in underwriting any existing manager in how likely they are to outperform. However, it's a venture. You can have these metrics. It's not perfectly predictive, right? We're not running a hedge fund.

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real time and then only after all of that do you put real money in to go put it to work when you're 100 comfortable that's it no pressure no hidden fees no gotchas none of that nonsense go to arch public.com right now and you can get started for free once you see how you can accumulate and manage crypto this way you'll never trade the same again archpublic.com go check them out today Who are some of the best early stage managers that you guys have come across? So I have to keep my cards close to the chest just because we're publicly, it's a public vehicle. There are things I can't say, but all I will say is keep an eye out. We'll be announcing a lot of them very soon.

Got it. Okay. So you guys haven't announced yet. We haven't announced yet. Exactly. And as I've been told by our compliance, there's now very, very different things than what I can. There's a lot of compliance. All right.

And now when you go and you look at themes, are there specific themes? Obviously, AI, I'm assuming, is a big theme. Totally. But AI is no longer a category. AI kind of inflects everything. All right. Explain that. So I don't believe we're at a point where there's AI and non-AI companies.

Every business has an AI component. It's like saying I invest in tech companies. Every company today in the S&P 500 has tech. And I think we're about there with AI as well. In terms of categories that are interesting, I mean, we're investing across the spectrum. However, there's been a general trend towards businesses doing hard things, right? Like today, if you're telling me you're going to build a CRM that does things better with

AI, your company may do well, but one, it's not a sexy narrative, right? It's not the narrative that's going to get people inspired to come work for you. It's not an inspiring fundraising narrative. So a lot of the companies right now that we're focusing on, but also doing well are those trying to tackle hard problems. You know, build physical things, solve the energy crisis, like actually build the tooling and piping behind the AI, new foundation labs. There's all of this very inspiring technology. And from that sense, it's never been a better time.

How do you do diligence on these, right? So, like, I've been pitched a gazillion different things over the last, I don't know, year. And I say, great, I can underwrite the founder. I can usually underwrite the market opportunity to some degree, right? Do some research, talk to some people, et cetera. But they're building something physical or it's science and biotech related, et cetera. I'm not a scientist, right? I know how to turn the light switch on, but I'm not an electrical engineer, right?

And so there's, again, some of it is an early stage startup, like it's all plans. And so the founder is the thing you're underwriting. But as the companies get a little bit bigger, now there's more things to underwrite. There's more things to do diligence on. How do you guys deal with some of the more technical components? The short answer is we cannot, and therefore we don't. The way I think about this fund is we're a capital machine. We're built to scalably deploy capital.

So what that means is on the early stage, we diligence the fund manager. We don't have time. You're right. The timing doesn't work. I can't diligence individual companies. On later stage, we diligence two things. One, we diligence the actual asset. This is, again, important from a compliance perspective.

Does the thing actually exist? The legal structure, all of that we diligence quite a bit. But beyond that, we have a blanket rule that we will only invest in a later stage asset as part of a priced round by an institutional lead where we're not going to set the price. We're not going to set the terms. So within that, we sort of control for it a little bit. We do our own diligence. Like we'll, you know, look at customer interviews and all of that stuff, but we don't have the resources to go deep on it. So we have these guardrails where we basically, I can't go in and lead a Series C or Series D or whatever.

Now, I think also part of this is, that is a very good investing strategy for a lot of people, right? It's draft off of some great investor who has a lot of these resources. And look, it doesn't mean it's going to be successful, but I don't think that that is crazy. And again, totally. It's more a case of like, we have to build a fund that can scalably deploy, you know, eventually, hopefully billions of dollars of capital. So I think having these guardrails is very, very helpful. And we can be very innovative in, you know, the art of the deal. Like, for instance, if we have a thesis on a company by buying out LP stakes, by doing all these innovative things, we can potentially win on access and we can win on sort of how

we get into deals. That makes sense. What do you think the biggest risk is for somebody investing in something like USVC? So generally, like I had so many friends text me, should I invest in USVC? What I first told them is don't and only invest if a few things are true. One, this is money you don't need access to for a long time. Like, yes, there's potentially quarterly liquidity and stuff. But my general thesis with private markets is like, don't do it unless you can afford

it, right? Like, make sure you're kind of contributing to your tax advantage accounts. So make sure you're maxing, like max out your, you know, get your 401k match, do your Roth IRA, contribute to your HSA, index the market, like do all of those things. If you have leftover dollars that you don't need access to for a while and kind of want the chance at asymmetric upside, only then invest in USVC. So I first tried to talk people out of investing in private markets. And if they still want to, is when I tell them, you know, USVC could be a fit. Got it. And then what about things like QSBS advantage, et cetera?

Like, do you guys have the ability for investors in USVC to also get those advantages or most of the things you're investing in don't qualify? So to quickly recap for anyone who doesn't know, QSBS is like, honestly, the biggest tax break in America. You can invest in a new C Corp today, get up to $15 million in zero taxes when the company sells. The good news is because there's pass-through taxation on USVC, the end investor is eligible for QSBS. However, it could take a while for QSBS to kick in because there's typically at least a three-year holding period. So some of the brand new companies we're investing in today could qualify for QSBS in three years. So three plus years onwards, we're hoping part of this is potentially tax-free, which adds a little bit of tax alpha juice to this whole thing. However, it will only apply to the smaller companies we're investing in today because once a company raises over $75 million, they're no longer eligible.

Yeah. And I do think that a lot of people don't understand this, but if you can get smart about it, it can obviously be- Totally. Again, my tax alpha, I think, is slept on. Explain your tax alpha strategy. Yeah. So, I mean, the company I ran before this was literally predicated around tax alpha, where I think the US tax code has 150,000 words added every year. We think of it as our enemy, like the taxes are so complicated. But within that complexity, there are so many little hacks and features that are frankly there to help people. And I think for the average person, index the market, get the returns you can. But the real differentiating factor is if you can save money on taxes, that ultimately lets you put more dollars to work. And over a 30, 40, 50-year career, that's millions of dollars in tax alpha.

What are some of the best tax hacks that you found? So varies by the person, but just easy stuff. I think user tax advantage accounts, like Trump accounts just came out. But tax advantage accounts are a gift from the government. Two, I'm a big fan of direct indexing versus investing in an index fund. It's literally the exact same performance as an index fund, but you get usable tax losses that you can use to offset other gains. Three, and this is very small, but I really like it because I live in New York City and

state and pay very high local taxes, is instead of using your high yield savings account, you could potentially invest in a treasury money market fund. You get a slightly higher yield, but in New York, you also will not owe New York State and New York City taxes. Why is that? Because all the dollars are from treasuries and treasuries have no local taxes. So literally, you'll get the exact same yield as your high-yield savings account a little bit more, but no local taxes. Interesting.

So there's like a bunch of these little things that you should stack them all up. They all add up. Yeah. And, you know, obviously founders, I think, have been figuring out ways to do like trust stacking. Totally. On the business owner side, there's a whole other host of things. Those three are just quick for anyone. For the business owner, what are two or three top of mind?

So for business owners, a few big ones. QSPS is obviously the biggest one. If you have a C-corp, you can pay no taxes on up to $15 million. You can stack that multiple times. I did that with my first company, ended up saving quite a bit of money. Two, if you have an LLC and you're making six figures or more, you can consider setting up an S-corp, which bifurcates your income into what you pay yourself as an employee and what you pay yourself as a business owner, and you don't pay any self-employment taxes on the business owner piece. Third, I really like this. My last company did this, was the one-person 401k. If you only have you and your spouse at a business, you can set up a 401k for yourself that lets you get up to a $72,000 tax deduction. You can invest it in any asset class you want. It compounds tax-free. You can borrow money from it.

Honestly, it's the most powerful retirement account in America and only available to self-employed people. And that's different than setting up a defined benefit plan or a SEP IRA or something. Yeah. Yeah, solo 401k is superior to SEP IRA, since it lets you make employee and employer contributions, you can get more dollars in. A defined benefit plan is something that's even more useful, but I would say only start considering it once you make at least four or 500k a year. Yeah, makes sense. What are the areas right now that you think people are not talking about

from an investment standpoint that you think, okay, these are the themes for the next decade or so? Yeah, look, I think we're at a point of just so much dramatic change. And I think by default, like people get afraid and people try to kind of move from the plan one of the hardest lessons i have learned is every time i've deviated from the plan it's ended up being stupid and my deviator from the plan is like like there was a time when i don't know we were getting five percent yield on cash and i'm like this is sick markets are overheated like you know what let me let me lock in this five percent yield on cash and i didn't like follow the own advice i give everyone which is put dollars aside to automatically index the market and kind of get back to work.

So I think, yes, it's, you know, this time is different, but for a hundred years, people have been saying this time is different. So stick to your fundamentals, like, you know, index the market, like take as much emotion out of it as possible. Yes, the world is changing really, really fast, but I do think the financial infrastructure we have kind of captures it, right? Like all of these massive companies that are innovating a lot, one, it's happening in America, two, it's going to end up at the U.S. stock markets eventually. If you do want to kind of

participate in some of that alpha prior to going public, consider products like USVC. But I think sticking to the plan is the most important thing. What's it like working with Naval Ravikant? Naval's great. He's very, very specific and opinionated. He's someone I'm very fortunate to have met when I was 19 years old. So I've known him for a very, very long time. He was one of the biggest investors at Teachable. There's also Jeff, who is on my board at Teachable and carry. So one of the most rewarding things about right now is being able to work with people that I both respect, admire, and look up to, as well as long-term compounding relationships. So it's great. And with Naval, I think he has very, very specific opinions on things, but his track record

is so good. Like on AngelList, every time we look at any data, Naval is like an outlier since his funds pretty consistently outperform. So I'm just trying to learn as much as I can. Yeah. If you're right all the time, then people start paying attention, right? Yeah, exactly. On the 250th anniversary of the United States, you tweeted out about what America means to you and the power of America. Explain a little bit. Yeah, absolutely. So, countries were weird for me growing up. I was born in India, but I never lived there. I grew up in Oman in the Middle East, where you're always sort of an outsider, right? You're not a local. and I moved to America at 17 for college. And immediately a lot of things in my life sort of started clicking, right? I've always been a very entrepreneurial driven person that

doesn't like to be told what to do. And America was the first place that sort of that resonated. Like one of the things that surprised me is as an 18 year old, I was trying to start a business. And every time I'd go to India or Oman, people would ask you, where's your dad? But in America, up, especially Silicon Valley, people took you seriously. And yeah, this country gave me everything. I was able to start a business here. I eventually got a green card, became American, started a second business here. So I'm definitely one of the people that chose to be American. And there's really no other country where you can do something like this. What was it like growing up in Oman?

Oman was interesting. It's a very peaceful country. We were expats. So Indian passport holder living in Oman, very beautiful country. I recommend people visit, beautiful beaches. It's relatively apolitical for the region as well. So very, very nice, very peaceful country. My parents still live there. I go back there. But from an identity perspective, the entire Middle East, you never become a citizen, right? You can spend all this time there. You still typically have a temporary visa. And I think that does inflect your sense of identity to a degree. Yeah. I mean, it's also if everyone around you is part of a group and you're kind of renting your participation. Correct. Like, look, you can live, there's

not many countries in the world where you can live for 10, 20 years. You can live in America for 20 years and you can become American. Your kids can become American. And a lot of places in the world doesn't work that way. Yeah. That's a great, a great place for us to wrap up. Thank you so much for taking the time to do this. Thanks for having me. Do it again in the future. Yep. Let's do it.