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Brett Calhoun: In Missouri and like the surrounding states, it's like 20 something percent of like the Forbes 300 largest private companies, and then like 15% of public companies. But there's only 6% of venture-backed companies in that area. Our focus is more of a volume game, and we've got a pretty ruthless sourcing strategy

We do about 300 outbounds on LinkedIn a week.

 Those are the kind of founders we're looking for. It's like the people I have to beg to give them my money.

Andrew Kazlow: Welcome to the Diligent Observer, where we help angel investors see what most miss. I'm your host, Andrew, and every week we explore what works, what doesn't, and why through conversations with experienced startup investors and operators.

My guest today is Brett Calhoun, General Partner at Redbud VC and a Forbes 30 under 30 honoree in venture capital. In this episode, we explore his ruthless sourcing strategy, his contrarian investment thesis focused on gritty founders. And the fascinating opportunity that he's identified in the Midwest where [00:01:00] 20% of Forbes largest private companies exist, but only 6% of venture-backed startups come from.

I hope you enjoy learning from Brett as much as I did. 

Brett, thanks for being with me today.

Brett Calhoun: Thanks for having me. Excited for the conversation.

Andrew Kazlow: Likewise. Well, I gotta start with my classic first question, and that is, what are you excited about right now?

Brett Calhoun: Um, I think it's just kind of pulling on the same thread of normally, which is just really being excited about. the entrepreneurs that we talk to and all the different backgrounds, regions, and applications for how they're using their intelligence to build stuff and, you know, taking advantage of all the latest and greatest with AI.

It's pretty exciting how fast, you know, people can move these days with building stuff. I wouldn't say there's like one particular industry that's more exciting than another. I think they're all, yeah, we're, we're more of a generalist investor, so we're kind of all over the place. We don't have, [00:02:00] you know, specific themes that we stick to.

I think our perspective on that is, you know, sure we could spend three to six months diving into a theme, but we might be late to the party if we spend that much time trying to do research. Um, or it might, you know, focus our time spending research on the wrong theme. And our focus is more of a volume game, and we've got a pretty ruthless sourcing strategy and have built up a strong investor and founder, uh, referral network.

And so yeah, we see stuff, you know, from, let's see, this week we're talking to like a filtration company to a biotech company using AI for scientists to like boring construction to, you know, if you look at our portfolio, we've got, you know, some very off the you know, beaten path investments.

We've got CRISPR gene netting mosquito company. We've got a robotic wig company, and then we've done like, you know, the traditional FinTech or vertical SaaS. And like, I think that's where a lot of people are playing [00:03:00] these days. But yeah, I think it's exciting how easy it is for a lot of people to build software companies now, or tech companies and enabling more than just people who've had the pedigree to build.

Like, I think people who are still proving that pedigree. There's so much more opportunity for investing in those types of entrepreneurs.

Andrew Kazlow: So, say more about your trigger mechanism. Like how do you identify the through line? Like what are you looking for? I'm always curious with more generalist investors, like what's the common thread or the thing that jumps out at you that makes you double click and, and really dig deeper with an opportunity.

Brett Calhoun: So typically like our, like what a Red Bud deal looks like is. You've probably got somebody who spent a decade or two in an industry lived a problem. And they got so tired of it that they decided to build a company to solve it. And, you know, they've teamed up with, whether they're technical themself or they teamed up with somebody who has the skill sets where they can [00:04:00] go um, and build something.

And then because they come from an industry, they have the street cred, they have the distribution network to go, you know, get solid customer discovery, but because you spent time in the industry, you don't spend, you know, 6 to 12 months beating your head against the wall trying to understand who the true customer is.

You know, the ins and outs of the problem. And you can just get to building and getting feedback. And those companies are really to easy to invest in. And so the ones who, they don't really wanna raise money, it's like there's like a breaking point where they need to, But they don't wanna raise money until they feel comfortable with raising money, where it's like we feel comfortable taking on and risking someone else's capital.

So there's like a period of like resilience shown where it's like, we don't care about the crazy logos. I'm not trying to go raise money to go hire engineers to go build the thing for me. It's like, no, I'm gonna go prove to myself that it's worth my time. And once I've done that, then I'm gonna go raise money.

Um, so we [00:05:00] look for that inflection point. So we're constantly sourcing talent, not companies, and we're trying to find them where, you know, we're either meeting at that inflection point or we're meeting at a point where they're you know, hopefully going to hit that inflection point and we're able to track them over time, and watch these, these founders.

And so oftentimes because it's a team that spent you know, decades in an industry, they've probably never built a company before. And so, you know, they're still proving that founder pedigree. Um, you know, We don't care if you went to Harvard or Stanford or, you know, worked at Google or whatever. Yeah, I think we're, and this isn't the case for all of our deals 'cause we certainly have people with pedigree and, and they're amazing to invest in of course.

But I think oftentimes where we, where we spend most time is entrepreneurs who are still proving their pedigree and showcase what, you know, we like to call strengthened by struggle and you know, have certain characteristics that would lead you to believe that this person would be a good operator, a good builder.

Because of some [00:06:00] of the operators we have on our team, we think that we can identify those people and underwrite them more efficiently than other fund managers can. So my partners built a, you know, top 25 YC company. Didn't go to high school or college. It's looking for entrepreneurs who are,

You know, could have a similar path to what they've done. Everybody has a different journey, a different path, and so it's not all gonna look the same. But there are some key characteristics. Like I had mentioned, you know, resilience is really the main thing. 

Andrew Kazlow: It's so fun hearing you talk about this because it feels like your whole thesis is just really thoughtfully counter positioned against the, You know, the stereotypical West Coast, you know, founder that has the pedigree and all the polish and all of that. That's kind of the, the character that we see in a lot of people's minds.

And so I, I love the almost counter positioning strategy focused on this grittiness and, uh, the struggle. Could you give some, maybe some practical examples of like some founders that you [00:07:00] feel like characterize this really well, maybe that are part of your portfolio or that you've worked really closely with.

Brett Calhoun: For sure. I mean, our portfolio is full of people that display these characteristics. A few, I mean, you know, locally here, like, you have some of the scrappiest people. There's a couple entrepreneurs I've known for like four years and, you know, when I first met him, I don't think they ever you know, thought about starting a company.

They were doing pretty well in their career paths and, um, you know, one of them ended up working with a portfolio company of ours and then you know, he got the itch to build something. And here we are a year later, and his third idea, and he launched like in like mid-January and was just like, not like wanting any money, just like feedback on what they're building. Two months after launching, they, so they were selling into public schools, which is not an industry we typically spend a lot of time in. It's, you know, they don't have big budgets. They don't really make quick decisions. And so, um, in two months he had like 50 schools signed up and they like 300K in [00:08:00] revenue, raised zero money.

Uh, they didn't really care if they raised money. And I, you know, had to beg 'em that we could be their first investor. And here we are, you know, what is it, two months after that and, you know, they've got 70 something schools and they just keep scaling and they've raised no additional capital. Those are the kind of founders that like to back, they've been friends for years.

They're both data scientists and they're applying. Their data science skills to support public schools who have never had anybody ever um, give them the time of day to help them understand budgets. You have a, you know, somebody who was a teacher for 20 years in English and now they're running, you know, a $20 million budget.

So they just went and talked to people and someone revealed a problem to them and they just kept pulling on that thread and built something and that's one example. There's another one where, you know, we had a team that we met, they'd raised 400-ish K [00:09:00] and, took 'em 18 months. They had a pivot.

I think they lived like next to a homeless shelter.

Andrew Kazlow: Beautiful story.

Brett Calhoun: And yeah, we, we meet them like right on the tipping point of like, how much runway do we have left? We gotta raise around, but like. They had massive like contract signed and we were able to, yeah, we were the first ones to commit to that round and then they ended up raising, they ended getting like four times the commitments of what they wanted to raise.

Had to double the round size. And they're just like some of the scrappiest founders I've met. I, it is literally just, you can just go look at our, like there's one founder that we worked with for nine months before he let us invest in this company and just solo building, you know, had a thesis around document intelligence wanted to build tools for some like legacy industry to start with as a wedge to have a more horizontal platform.

But we were able to plug 'em into, you know, one of our LPs who had, using an executive at a large title insurance [00:10:00] company and built software for their teams, this title insurance company that became infectious across the organization. Just, you know, personal funding this business. And finally, once he starts getting some traction, you know, I'm the first person he calls and says, Hey, I think I'll take your money now.

And today, we're still the only investor and he is brought in a whole team and they've got a customers and they'll start raising here a little bit. But like, those are the kind of founders we're looking for. It's like the people I have to beg to give them my money.

Andrew Kazlow: Hmm.

Brett Calhoun: Yeah.

And then the most successful so far, so we have 31 companies in this fund. The Southeast has been the most successful, actually, which 

is kind of a weird stat. So we've got two outlier companies out of the 31. There's more that are performing really well and, and some that are, it's just too soon to to tell.

But yeah, two, Atlanta, Miami that are absolutely crushing it right now.

Andrew Kazlow: Hmm.

Brett Calhoun: I don't know if there's, Yeah. Something in the Southeast, but

Andrew Kazlow: Something. I'm in the air these days.

Brett Calhoun: Yeah.

Andrew Kazlow: [00:11:00] It, It's interesting, Brett, even in, I'm seeing a theme even in the few companies that you mentioned around the value of this network that you all have built, um, this sourcing kind of ecosystem. It sounds like you've been really thoughtful about how you've built that over the last few years.

You mentioned that in your intro. I wonder if you could unpack a little, maybe a little bit more tactically, like how have you all built this network? Obviously your founding team uh, had something to do with that and so maybe we, maybe this dovetails into the origin story, but. I'd love to just hear like how you've built these, these networks that give you access to these kinds of opportunities where you have to beg to to get on the cap table. 

Brett Calhoun: it's Honestly just a lot of hustling. Uh. I am notorious for cold outreach. Um, And so I've probably annoyed thousands of people. The origin story, so we started an accelerator fund four years ago called Scale Accelerator, and [00:12:00] it was mid 2021. Uh, the two brothers from Equipment Share wanted to start an incubator.

They brought me in to build that. Probably like the worst marketing condition in history to start an accelerator fund. So much capital in the markets. Why does anybody go to an accelerator when, you know, VCs are pouring more money than ever? So your talent pool is diminished. And you know, we're doing it in a place that like nobody's ever heard of, Columbia, Missouri. The Equipment Share founders, you know, they were in 2021 still, you know, they had a unicorn startup and no one really knew who they were. It was kind of boring industry construction, not anything sexy and. So, yeah, I had to come up with some pretty scrappy ways to source talent. I started scraping the YC co-founder matching platform. Uh, hopefully this is like burning me in the future.

But we were, we were pulling in data from that platform and meeting on like, there was thousands of entrepreneurs on there. It was recently launched, and so you could filter it by like technical people with an idea. And so we were picking up people before they were like launching their companies [00:13:00] 'cause they were looking for like their counterpart, but like we were getting them into our network.

And so like I was meeting these people before they were getting into the YC application process and we did a few deals from that and, and there was, you know, some local talent obviously in, in Columbia. So that was the, to start it was like, how can we be really scrappy? How do I find talent for an accelerator fund?

And then sell them on the value that we're gonna provide. So everything that we did started from like minimal resources as friends and family fund. We had like almost no resource for anything. It was just me, the only full-time person on the team. 

And the opportunity that we saw was that, there wasn't like a national pre-seed brand in like the Heartland area and that we have some interesting pieces to build that certainly investors here, but not a lot of, traction at the, at the pre-seed stage. And which is interesting too, if you think about a lot of the entrepreneurs that we invest in, so the coast is very like [00:14:00] hyper like pedigree, like hyper indexing pedigree. And then, you know, a lot of investors in the Midwest are, you know, indexing more traction.

We're in Missouri, it's a show me state, you know, it's,

Andrew Kazlow: Yep.

Brett Calhoun: Do you have 20K/month in revenue? And, but there's like this opening where you have this, someone who's proving their pedigree, they don't have any traction. Maybe they're in the Midwest, maybe they're not. And so we saw an opportunity there, but the way that you find these people is literally just by, like we, we do about 300 outbounds on LinkedIn a week.

We do a few thousand a month on Twitter. And I've been doing,

Andrew Kazlow: No kidding.

Brett Calhoun: That for like five years straight now. So like my My newsletter of 15,000 people is mostly operators, mostly entrepreneurs. We've done it on Twitter and LinkedIn and the two are pretty separate networks. A lot of engineers don't respond on LinkedIn because they get just blasted by recruiters.

And so a lot of times you gotta meet him on Twitter. So in parallel, I, I grew both networks and you can go, mean, they're pretty similar. So I've got [00:15:00] about 19,000 on LinkedIn and about 18,000 on Twitter. And that's mostly founders. 

So, So

like go, yeah. 

Andrew Kazlow: I wanna back up and, and just like, take me back to, you know, it's 21, you're, you're getting started with all of this. You've unlocked like, oh my God, we have the YC list. What's your pitch back then? Like, walk me through if, if I was a founder, you know, that you were reaching out to, what was the pitch. And then like how has that evolved to, to now?

Brett Calhoun: The pitch then was. What was the pitch then? This was so long ago now. Um, it was something in the vein of like, you know, and it really hasn't changed much.

The difference in the thesis is that the accelerator was to find entrepreneurs and help influence the outcomes of those entrepreneurs by basically taking the story from the Equipment Share founders and their insights, and then like walking 'em through that playbook. The learning there was that you don't want to in invest in people that you have to influence, nor [00:16:00] do you want to like push your playbook onto somebody else because 

everybody's journey is different. And so you could kill somebody's startup path if you try to get 'em to do it the same way that you did.

Andrew Kazlow: Uh, say more about that lesson. Like how did that lesson crystallize for you? Is there a story here?

Brett Calhoun: I wouldn't say there's one story. I would just say that the learning was that, some of the things that you may have pitched somebody on or try to help them with didn't quite work for them. And, yeah, everybody has a unique journey and they have to, you know, some things you have to figure out on yourself.

Like, there's like pros and cons with helping, like introducing somebody to customers, for example. It's like, I want to introduce you to customers, but at the pre-seed stage they just almost kinda like, that's like a value I can pitch, but at the same time it's like, well, you have to get your own customers too.

Andrew Kazlow: Hmm.

Brett Calhoun: You know what I mean? So the accelerator, the pitch was like, Hey, we're gonna put you through this cohort. We're gonna bring in all these like really scrappy operators who built massive companies and we did all these different sessions. And you're gonna [00:17:00] get support from like the equipment share founders.

And we'll do like, you know, weekly check-ins. We'll do you know, different talks on, like, building your company. You can ask questions and then you have like, you know, you know, seven or eight companies in each cohort that you can work with. The learning there was that no one gave a shit about that. Uh, The only thing that people cared about was, can you introduce me to investors and can you introduce me to customers?

Can you help me hire an engineer? It's all network effects. And then the second thing was, if you're investing in good people, they're never really gonna call you. But if they do, it's gonna be more targeted. It's gonna be like, Hey, my, my co-founder and I are fighting. Maybe I wanna fire the CTO. Is he performing or am I just crazy?

And then it's great to loop in, you know, the Equipment Share founders who've gone through a lot of these things and they can walk through some, walk somebody through a more calculated calculated path for that. And so, all of this like programming and cohort stuff and things that we try to put together [00:18:00] just were not great, to be honest.

It was really just the networking, like getting to be in the same room as other entrepreneurs. But like, at that point then you have to ask yourself, well, if that's the case, then what, then how much is that value truly worth? And why are we taking so much equity as an accelerator fund? If our product to founders is capital and then, you know, if they want our support, great.

Doing it in a cohort basis or charging a lot of equity for it doesn't make sense. You're making it really hard for your customers to buy your product. And so those were all insights of like, yeah, we should not do this accelerator thing anymore. We need to change, we can build a brand here in the middle of the country and

there is something unique about what we're doing and there's a different perspective, there's a different network, different values. There's an opportunity to tap into a lot of high net worth LP capital of operators who've built like traditional companies, built tech companies who've never really been part of the venture capital asset class.

And then to also build a financial product for them where you could [00:19:00] say, Hey, if you want to get into venture, you don't have to give your money to a fund manager in New York or SF. We get the same deal flow in maybe even better terms. Uh, we work our ass off and we build a brand here at home in Missouri.

And so that was, you know, the opportunity we saw was just like, there's, there's a, there's a capital opportunity, there's like an asset opportunity for people to invest in, and then there's a different venture product that we can provide, and be complimentary on the cap table at the early stages. So, you know, most of the founders that we're investing in.

All the investors on the cap table are in San Francisco or New York, and, you know, we bring some diversity to the cap table. Um, you know, you've got people who've built a company who didn't get a high school or college, and we're in this, place that most people haven't heard of called Columbia, Missouri.

And, um, it's just different and people like it. They, our founders call us like their Midwest HQ. And a lot of the companies like. You know, there's all these like sleepy industries that haven't really had a ton of innovation because [00:20:00] it was so hard to build products for 'em, so hard to get 'em, you know, onboarded.

Um, but now with a lot of the AI solutions and how it's just, it's more than just like moving the needle by like 10%, It's like, it's like doubling the output

of these companies. And so, you have all these operators and companies here that are customers of those types of innovations and there's a giant mismatch of like, I think the stat is there's, in Missouri and like the surrounding states, it's like 20 something percent of like the Forbes 300 largest private companies, and then like 15% of public companies. But there's only 6% of venture-backed companies in that area. So there's this big mismatch of like, innovation and like legacy businesses. I don't even remember what we were talking about, but like, yeah.

Andrew Kazlow: So, so timestamp for me on kind of when you guys had this realization and then like, maybe what your primary focus has been over the last [00:21:00] couple of years, or, you know, since then. You've kind of moved away from this cohort-based structure now to a full fledge kind of VC strategy. Talk me through like timestamp and then what have been the main focal areas for you guys, uh, in recent history.

Brett Calhoun: Yeah, we rebranded everything. In June of 2023, I believe is the, the date. So we started in June of 2021. We changed in June of 2023, and we had raised a more formal fund at that point and, had a, a different LP base. And now we're about to close the next fund and, um, things are going super well. So, at this point it's working and with the next fund we're just doubling down on what, you know, what we did in fund one and, continuing to take the lessons learned there and, you know, refine our product as a venture capital fund. Yeah, we're in year four, or I guess year four and change going into year five, a year from now will be year five.

Andrew Kazlow: And [00:22:00] if I understand correctly. It doing some online research, seems like a pretty significant portion of your LP base is actually based there locally in the Missouri ecosystem. 

Brett Calhoun: Yup.

Andrew Kazlow: If that's correct. I wonder if you could kind of break down a little bit of like, Brett's mind map of, you know, how that ecosystem is structured, who the big movers shakers are.

You know, I'm from Texas, so I haven't spent a lot of time in Missouri, uh, like probably many of our listeners. So I, I wonder if you could kind of. Like, go, go a level deeper and, and walk me through the lay of the land locally. 

Brett Calhoun: There's, there's a ton of operators here, a lot of people who built companies. I was just, you know, having a conversation with somebody today who's from Springfield, Missouri, and how, you know, there's this company called like DMP that like nobody talks about, but they're in like all of the Wells Fargos and it's worth like a billion dollars.

Or like Jack Henry, which is like one of the largest FinTech companies, or the O'Reilly family in Springfield, or like John Morris who started Bass Pro Shops and Big [00:23:00] Cedar and is worth like tens of billions and like, that's just Springfield, Missouri. Then you have Cape Gerardo, you've got like the person that started Rhodes Convenience stores.

Uh, you've got the guy that started like, let's hats like Plaza Tire. This is a town of 35,000 people. You've got in St. Louis. It's like you have all these people like Sam Altman from St. Louis, Jack, Jack Dorsey's from St. Louis, Jim McKelvy, who founded Square with Jack Dorsey like the, um, in Columbia, Missouri, you've got, you know, a history of like the Walton family, like Sam Walton grew up here, went to Mizzou. It's the wealthiest family in the world. You've got, you know, Storage Mart. You've got the Kroenke family that owns, like the Rams. They own more real estate than anybody. The largest barrel manufacturer in the country, Beyond Meat, Zapier guys, they all started here. Wade Foster still lives here. Obviously Equipment Share.

Now you've got this company called Patient. You've got like Midway. which is like All these companies that are like multi hundred million dollars private companies that no one talks about in Columbia, Missouri. Kansas City, I mean, is, is [00:24:00] very similar, right? St. Louis is a lot of like, more generational money.

Then Kansas City's a lot more newer money. So you got a lot of healthcare folks, Cerner, Centene, you know, the, the Kemper family with like C2FO and UMB Bank and Casey, like, it's a lot. a lot, a lot. Like we're, We're pulling in like multi seven figure checks from like individual investors. Um.

Andrew Kazlow: This,

This is what's fascinating to me is like, you know, not being from the area, right? It's just so easy to not think about that, to miss that, to, to overlook it. And I mean, this is crazy, The na, the names, I feel like you could just keep going.

Brett Calhoun: There is an absurd amount. I, uh, oh. One of the, One of the people on our team made a post the other day from a slide in our deck just about like, we have a in our deck for fun too, just like a image about like, why Columbia? And it's like, I don't know, it's our home, but also it's a, it's a pretty special place.

Like there's all these like, massive [00:25:00] companies that are built here and, and then all the, the network from like University of Missouri. So you've got, like, uh, let me see, uh, Lear Field's another one that's like one of the largest like sports companies. They're still you based right down the road. Other companies like Club Car Wash. I don't know, they're probably, I don't know how many, they're like multi hundred locations now, and it's a car wash thing started in Columbia. It's just such like sleepy business. Like I had this entrepreneur out to me the other day that it started like a fresh lemonade business.

Never would've thought that this was like, it's like your, your like joke of like being an entrepreneur of like, oh, I started 

lemonade stand. Reached out, has a fresh lemonade stand, and now they like take it to your home and your parties and they're about to go like multi-state. And it's like what?

Like what? Like how, like where are these entrepreneurs coming from? Like it just keeps churning. Like Carfax is, and other companies started here in Columbia. It's like the stuff that Veterans United Home Loans, it's the largest VA lender in the country. They've got 25% of the market. Like [00:26:00] It's crazy. And Columbia's a town of 130,000, so yeah.

Andrew Kazlow: I mean, I'm just like shocked, right? As you're walking through all these names, I recognize all these names, but I would never have said, oh yeah, they're from, from Columbia.

Brett Calhoun: Yeah, it's pretty cool. 

Andrew Kazlow: No way. So Brett, I want to kind of ask a little bit more about how you guys think about and how you interact with angel investors, what the angel community looks like locally.

Brett Calhoun: Yeah, it's,

You know, the angel group here is a group of you know, great people who enjoy angel investing, enjoy supporting entrepreneurs. A lot of them are entrepreneurs themself and they get together as a group and it's different than a fund. You know, like those, that's more of an opportunity where you're gonna make individual decisions about a company you wanna support. It's a little bit harder to scale, obviously. Um, you know what, with a fund, it's more of like, you're paying us to go do that for you. So it's slightly more de-risked. I mean, from an, from an angel, it's, it's hard to [00:27:00] have because if you're an individual investor, you know, starting out as an angel and you don't already have the network, it's like you gotta figure out how to find the deals. And then you gotta have the brand for like, somebody to want to take your money and to, to take the allocation and then to understand like, what's happening in the markets, what is good, what is bad? Where should I put my money? How many deals should I do a year? How do I get, you know, diversity in the portfolio?

The great thing about being angel investors is, you could put money in one company that goes 100x and then you could put money in 10 funds and not one of them goes to 10x. You know what I mean? Like it's, it's more risk return. Uh, so you can certainly make more money being your own angel investor if you know what you're doing.

And we love working with them, especially if there's an angel entrepreneur or an angel with a background in an industry that's very strategic and has like a network to support the entrepreneur that we're investing in. So I think yeah, angel investors are very, very important for, uh, the venture industry in [00:28:00] general.

And if I was an angel investor and I had, which I, I technically, yeah, I've done some angel investments, but if, yeah. Not including me, if I'm an angel investor. Um, I would probably want to make some angel investments for fun or through, you know, not quite altruism, but if you're in a place like Columbia, you might want to, you know, support entrepreneurs from Columbia, even though it might not be the best opportunity.

But like, you wanna support somebody who has a passion here locally, and you can do that. I can't do that because I'm a fiduciary of somebody else's capital. My goal is like, if I'm gonna invest in somebody here, they have to be just as good as somebody somewhere else, or another deal that I'm looking at.

I'm not just gonna invest in you because you're here. So as an angel, you have the flexibility to choose where your money goes. Uh, But then if you, if you invest in a fund, you get exposure to somewhat, you know, risk adjusted returns where, uh, there's a brand behind it. And if somebody does their job well, I mean, you can make 30% annualized returns.

Uh, it's locked up for a while, but it's, [00:29:00] yeah. So I would do both if I was an angel

investor. Because, yeah. Cause one side do whatever I want, I can have fun. I can pick the directs, I wanna do the fund. It's like, here's part of my allocation. I'll give it to a couple of different fund managers or one fund manager, whatever. And then you invest in 40 companies? 

Andrew Kazlow: So, Brett, as you look forward, what are some of the things that, uh, our goals or specific objectives for you for the fund? things that you're, you're working towards. You guys have hustled and grown a lot, uh, over the last few years since getting started in this.

Tell me what the, the future holds, what you're looking at.

Brett Calhoun: Yeah, I mean, I think it's, you know, continuing to build our brand here and we're getting ready to close this next fund. You know, I think it's, you know, continuing to grow the team and, eventually become a lead investor ourself where, you know, we, we've been building a brand, we've been more collaborative.

We don't really lead rounds, but I think filling into to lead shoes is kind of a [00:30:00] natural progression. And kind of becoming like the go-to like pre-seed brand in the middle of the country. So that's where I see things going and things could of course change in the next few years from there.

And as we keep refining our product, you know, as of right now, I fully believe in the, in the generalist approach with what we're doing and, and being in the middle of the country and, you know, seeing a large swath of opportunities and then being able to pluck out what we believe are the best talent from that.

And so it's hard to think that we'd ever deviate from being a generalist because we would never want to be like the best founder we ever thought we'd met, and then they're just not in a vertical that we invest in. I mean, like that would be horrible. So I don't think we'll ever, ever change that approach.

But Yeah, I think we'll keep finding reasons why. Yeah, why we are the fund that a founder would pick and why we would, you know, as we start growing and becoming more competitive, um, as a lead investor. So, I have some pretty strong [00:31:00] ambitions, like we're, this is like the long haul. Uh, we're trying to build a longstanding, like premium venture capital brand.

Change how people think about venture in the middle of the country. So we've got a long way to go, but we've covered a lot of ground pretty fast. So

Andrew Kazlow: Well, and you've certainly built a system to blast out. I, I'm still just reeling from the numbers that you're sending out every week. That's incredible. 

Brett Calhoun: We do a lot of calls, you know, between my associate and I we're, you know, we're hitting 1501st calls and a 12 month period and, you know, we're looking at a few thousand deals and, we try to be everywhere and see everything with a small team and one of the things I do need to do is start tracking the stuff that we missed.

Andrew Kazlow: Mm. That's scary.

Okay. 

Brett Calhoun: Certainly a few of 'em. Quite a few. So, start learning from those, you know, why did we not invest? And, but it is so hard to tell 'cause the company may be tracking, let's just say that we didn't invest two years ago and they raised $15 [00:32:00] million. I don't know, like it what we believed could become true, 

that company could still fail, you know what I mean?

Because our, our investment approach is, and we've talked to companies where there was a clear path of like, alright, well this, this founder will clearly probably raise a hundred million dollars, but we the company I think is gonna upload. Because we don't really care, like who's investing with us, we're not 

local investing.

It's like we just wanna invest in good people. We were gonna build sustainable businesses and gonna make us a lot of money. Where there's literally funds set up that literally just invest with top tier investors. And like, that's the approach. It's like, that's great if you're trying to, you know, go schmooze, like institutional LPs, but we have a different LP base, so we don't really have, we're not like forced to do that.

Um, I also think that's a uniqueness with us.

Andrew Kazlow: Well, Brett, what's the best way for our listeners to stay in touch with you, follow your work, get added to your 19,000 on LinkedIn.

Brett Calhoun: Oh, just connect with me on LinkedIn or [00:33:00] subscribe to our newsletter. Uh, our website's, redbud.vc, our newsletter's on there. Uh, my email's b@rb.vc. It's pretty easy to remember. 

Andrew Kazlow: Fantastic. Well, Brett, this has been a blast. Thanks for joining me today and I look forward very much to our next conversation.

Brett Calhoun: Awesome. Good to meet you as well. Thank you.

Andrew Kazlow: Thanks for listening to this episode of The Diligent Observer. I'm your host, Andrew, and if you're an angel investor looking for essential angel intel in five minutes every week, I think you'd enjoy my newsletter. I send my best stuff, interesting deals, and more straight to your inbox so you never miss a thing.

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