Authors: Matthew Glass
First published in Great Britain in 2015 by Atlantic Books, an imprint of Atlantic Books Ltd.
Copyright Â© Matthew Glass, 2015
The moral right of Matthew Glass to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act of 1988.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior permission of both the copyright owner and the above publisher of this book.
This novel is entirely a work of fiction. The names, characters and incidents portrayed in it are the work of the author's imagination and not to be construed as real. Any resemblance to actual persons, living or dead, events or localities, is entirely coincidental.
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A CIP catalogue record for this book is available from the British Library.
Trade Paperback ISBN: 978 1 78239 261 3
E-book ISBN: 978 178239 262 0
Printed in Great Britain
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26â27 Boswell Street
THE PITCH TOOK
less than twenty minutes. Robert Leib listened without interrupting, dividing his glances between the slides in front of him and the two young men sitting on the other side of the table.
When it was finished, he leafed silently back through the presentation. They were in Leib's conference room in a sprawling, stone-clad office building on Sand Hill Road, the strip outside Palo Alto favoured by the venture capital firms that had provided the funds to blow open the age of the internet. Just 200 yards in one direction was the office of Sequoia Capital, 300 yards in the other direction was Andreeson Horowitz, both of them early backers of some of the biggest names on the net. Leib Roberts Berkowitz, or LRB, as it was known, had made a string of successful tech investments that had brought Robert Leib and his two founding partners immense wealth.
Leib was a short, tubby man in his fifties with receding hair and a trim, greying beard. He wore a blue polo shirt and a pair of khaki chinos.
He stopped on one of the slides.
âThis user growth,' he said to the man who had done the talking during the pitch. âChris, this is all verifiable, right?'
âNo. We just made those numbers up.'
Leib smiled for a second. Chris Hamer was thirty-one, a tall Californian with blond hair and a mischievous glint in his eye. Leib had invested in one of Hamer's previous ventures and made a moderate amount of money. But this venture wasn't Hamer's, and the stakes, Leib knew, wouldn't be moderate.
He was much more interested in the other person sitting at the table, Andrei Koss, a pale young man with curly dark hair who had sat through Chris's pitch with an air of indifference or impatience or something, anyway, which Leib wasn't accustomed to seeing in the founder of a start-up when his company was being pitched for hundreds of millions of dollars. Like every other investor in the valley, Leib had been interested in meeting Andrei Koss for quite some time. Just back from his annual salmon fishing trip to Scotland, the venture capitalist hadn't hesitated for a second when he got a call from Chris Hamer asking if he could bring Koss to talk to him.
Leib closed the slide deck. âYou know, the general assumption is that you guys would never look for venture capital. You've got the revenues to fund your own growth. So this is interesting, but, frankly â¦ you don't need me.'
âWe're here,' said Chris.
âYeah, but you don't
me. When someone comes to me for money they don't really need, I get offered terms I don't really like. So I'm thinking to myself â what are these guys doing?' Leib smiled again. âWhy would they invite the vultures through the door?'
Chris grinned. âThere's a bunch of development we need to do and we think for a year or two we're going to need additional funding to get through that.'
âWhat kind of development?'
âWhat kind of stuff?'
âWork on the platform. Work on the site. The usual stuff, Bob. It's not one single thing. We've got a bunch of projects in mind. We've decided, rather than doing them piecemeal over however long that would take, let's get the funding and deliver them all right away.'
Leib's eyes narrowed for a moment, then he glanced at Andrei, who hadn't said a word since shaking his hand. âHow old are you?' he said.
âIs that material?' asked Andrei.
âIs it immaterial?' said Leib. âYou're the CEO of this company and you're asking me to invest. I'd like to get some sense of how much experience you have.'
âI'm twenty-three,' said Andrei.
âAnd according to what I've just heard, you own fifty-eight per cent of this company?'
Chris reached towards the slide deck in front of Leib. âThe full share structure's in the presentationâ'
âThat's right,' said Andrei.
âWell,' said Leib, âthe first thing I should say is, congratulations. I mean that. From what I know, from the buzz, from what you've just shown me, you've built an extraordinary business in â¦ how long is it?'
âExtraordinary,' said Leib.
âThank you,' said Andrei.
Leib sat back in his chair, hands behind his head. âAndrei, what are you trying to do with this thing? What's the vision?'
âDeep Connectedness, Mr Leib.'
âI've heard that you use that term. What does it mean?'
âIt means giving people a way to come together wherever they are on the globe. It means creating the most efficient way for them to find others who share their interests, create a connection, share their knowledge. I want to give people the means to come out of their circle of friends, out of their neighbourhoods, out of their communities and find people they would never have found before. That's the new world, Mr Leib. Clusters of people with shared values, shared ideas, wherever they are on our planet.'
âYour website does a lot more than that. Why don't you just post a list of names for people to contact?'
âPeople don't respond to that.'
âHow do you know?'
âI tried it.'
Leib suppressed a smile. There was a sense of certainty about the 23-year-old that chimed with what Leib had read in the newspaper reports of him. He was blunt, but Leib guessed he was honest. It was obvious he didn't have much in the way of social skills, but then when had he ever met a great programmer who did? Leib would have been worried if he'd turned out all smiley.
âAnd the model of advertising you use? Controversial, isn't it?'
Chris grinned. âAnything revolutionary is controversial.'
âThe way you get people to buy stuff â¦'
âIt's not my role to say what forms Deep Connectedness can take,' said Andrei. âIt's not my role to tell the world what it can do. My role is to help the world do what it wants to do most efficiently.'
âIs that how you see it?' asked Leib.
âWhat other way is there to see it?'
âDidn't I hear there was a district attorney investigating to see if she could stop what you're doing?' Leib had had his staffers put together a summary of everything in the public domain about the business ahead of the meeting, and knew exactly what the Santa Clara district attorney had threatened.
âOld news,' said Chris. âShe's backed off.'
âSure, but my question is, how sustainable is this?'
âThat's a judgement, Mr Leib,' said Andrei. âAt present that's not quantifiable.'
âBut you're asking me to judge.'
âWith respect, sir, that's your job, isn't it? Isn't that what venture capital firms do. You weigh risk and allocate funds, correct?'
Leib smiled. âThat's what I do.'
âThen I guess that's what you're going to need to do here.'
Chris pulled a tablet computer out of his bag. He swiped it and quickly typed a few letters, then slid the tablet across the tabletop to Leib. âWe thought you might want to get an experience of the functionality.'
The venture capitalist glanced down at the screen and found himself looking at someone's home page. A picture showed a slim, fortyish man on a riverbank with a fishing rod in his hands.
Another showed the same man holding up what must have been at least a fifty pound salmon.
âWho's this?' asked Leib.
âJust someone,' said Chris. âHe's kind of a salmon enthusiast like you are. We set up an account in your name and put your interest as salmon fishing. He's obviously seen your profile and thinks it might be cool to talk.'
âMy profile?' said Leib sharply.
âThe one we created. It's all public knowledge. We just took a few facts off your profile on the LRB website.'
âThat doesn't say anything about salmon fishing.'
âI added that,' said Chris. âBob, anyone who knows you knows that's the only interest you have in your sad life.'
Leib stared at Hamer mistrustfully.
âBob, talk to him. How's it going to hurt? He's sent you a Bait. Just click on it.'
Leib saw a button labelled, âTake my Bait?'
âBob, I really think you ought to try it out.'
Leib hesitated. Then he clicked on the button.
Words began appearing in a message box: âHi, Bob. How are you doing?'
âWhat's his name?' asked Leib.
âIt's on his page.'
Leib looked. Paul. Still he made no move to respond.
Chris sighed. âBob, we're going to shut down this account the minute we're done here. You can watch us do it. Talk to the guy. It's not going to kill you. We have four hundred million people who do it every day.'
âWhat do I say?'
âTalk to him. Pretend he's sitting right here. Just be natural. He's just a guy who likes salmon fishing.'
Leib hesitated again. âOK,' he murmured. He typed. âHi, Paul. I'm well. How are you?'
âGood. I'm fishing here in New Zealand. Just getting ready to go out for the day. Had a great day yesterday. Eleven beauties.
None of them under twenty pounds. One of the guys landed a sixty pounder.'
Leib gazed at the words for a moment. Then he typed. âSixty? Really?'
âI kid you not.'
âWhat are you catching?'
âChinook. Down here they call it quinnat. Best chinook fishing in the world. Most unspoiled fishing left on the planet. You ever been to NZ?'
âBob! You should. It's awesome. Better than Alaska.'
âHave you fished Alaska?' typed Leib.
âPlenty of times. Kenai. Karluk.'
âKarluk? I've been there too. Remote Alaska is awesome.'
âBob, I could tell you a story or two about Karluk. You know, a couple of years back they had a September blizzard up there.'
âI heard about that.'
âYou heard? I was there! But let me tell you, Bob, New Zealand is something else. There's this great spot I know on the Hurunui River. You should come down here and try it. You really should. I know a bunch of guides who can take you places where there are fish like you've never seen before. And there are some great lodges. Real luxury places. If you want to bring a bunch of guys, you'll live like kings. I'll send you a link with some information.'
âWhat are you talking about?' asked Chris.
Leib looked up, suddenly conscious again of Chris and Andrei watching him. âSalmon fishing in New Zealand.'
âHave you ever been there?'
âDo you think you will?' asked Chris.
âMaybe. Maybe it's time I tried a new place. I've never done Southern Hemisphere. Paul says New Zealand's even better than Alaska. He's going to send me a link and I'llâ'
Suddenly Leib stopped.
Chris laughed. âHow long did that take, Bob? Two minutes?
What would you spend on a trip down there? Ten thousand dollars? Twenty?'
Leib didn't reply. In two minutes, as Chris had said, New Zealand fishing had been sold to him in a way that an advertisement or a brochure could never have succeeded in doing. Bob Leib felt that he was in the presence of something immensely, almost scarily powerful. And did he want a part of it? Even more than when Chris Hamer and Andrei Koss had walked through his door that morning.
âYou can see the results of the larger deals we've done.' Chris opened the slides in front of Leib again. âThey're only the beginning. We're currently working on deals withâ'
âHow much are you looking for?' asked Leib, cutting across him.
âThree hundred million.' Chris said it quickly. He had pitched companies before, but nothing like this.
âFive per cent of the company.'
Leib ran his hand thoughtfully over his beard. âThree hundred million for five per cent. So after three years of operation, and with the numbers you've shown me, you value yourselves at six billion dollars.'
âNo,' said Andrei. âI value us way higher than that, and I'm not the only one.'
Leib raised an eyebrow.
âIt's customary for the vultures, I understand, to get a premium.'
Leib laughed. âThat's because of the risk, Andrei.'
Andrei didn't reply.
Leib looked at Chris. âWho else are you talking to?'
âNo one. That was my advice to Andrei. We're speaking with you. If you can do the deal, we do the deal.'
âIs that how you see it, Andrei?'
Andrei nodded. âChris says you know the space. He says you'll bring wise counsel as well as funding.'
âDo you want wise counsel?'
âI'm only twenty-three.'
Andrei's expression was deadpan. Leib didn't know if he was making a very dry joke or simply stating what he took to be obvious.
Leib put his hands behind his head again and gazed at the two young men. Then he sat forward. âLRB won't put three hundred in by itself. But I could potentially put that together through a syndicate with another couple of funds. We'd lead. We'd put in a hundred and fifty to a hundred and seventy-five. The rest would come from the others. How would you feel about that?'
âI told Andrei that was how it would likely work,' said Chris.
âWe'd need to have right of refusal over the other funds before you approach them.'
âThat could work. So â¦ three hundred million for five per cent? Is that what you're asking?'
Leib looked at Andrei. âLet's be clear. Andrei, is that what you're saying? You're prepared to sell five per cent of your company for three hundred million.'
âYes,' said Andrei.
âAnd a seat on the board. We'd need a seat on the board.'
There was silence.
Chris could barely breathe. Meetings where the venture capitalist did the deal right then and there were the stuff of legend. Usually it took weeks of negotiation and hair-splitting.