In this interview, investing legend Jay Hoag argues that everyone is chasing SaaS and AI, leaving consumer internet (like mobile entertainment, music, gaming) overlooked—and that's exactly where the opportunity lies. With 5 billion smartphone users, he believes new winners will emerge. Key holdings: Netflix (TCV owned 43% at IPO, long-term hold), Spotify (another legendary long-term hold), and Expedia (also a long-term hold). The takeaway: don't just follow the crowd; the neglected consumer space could be the real goldmine.
TCV co-founder Jay Hoag shared the core strategies of growth investing on the program. He believes that macro factors, such as regulation, have unexpectedly become central to tech investing, and holds a contrarian view: the consumer internet sector currently presents enormous opportunities, while mo
Jay Hoag is the co‑founder of TCV (Technology Crossover Ventures), who pioneered the growth investing category. Over 30 years, he has invested in legendary companies such as Netflix, Spotify, and Expedia. The main thread of this issue: In the SaaS and AI frenzy, consumer internet has been severely overlooked, and that is precisely the biggest value opportunity today. The core judgment comes from Jay Hoag: “When the ball rolls to one side, everyone runs that way. I find it hard to believe that no new consumer internet company will be created in the next 10 or 20 years.”
Jay Hoag believes that the current market obsession with SaaS and AI has gone too far, making consumer internet the most attractive contrarian investment opportunity.
Deduction and Validation: Jay Hoag points out that new consumer internet companies take time. Signal for validation: whether a new consumer application/platform achieves a breakthrough in user scale and secures large-scale funding.
Jay Hoag warns that investors often overestimate the short-term impact of technology while underestimating its long-term impact—the most common "fool's gold" pattern in growth investing.
Deduction and validation: Jay Hoag argues that investors should focus on the time gap between technology becoming "available" and its "commercialization." Validation signals: whether the actual revenue scale and user growth rate of new technology meet expectations.
Jay Hoag is baffled by the current IPO market slump, arguing that the best companies benefit from going public over the long term.
Deduction and Verification: Jay Hoag believes that massive private capital needs returns and will ultimately need the IPO market. Verification signals: whether IPO numbers recover, and whether large private companies (such as Stripe) ultimately choose to go public.
Jay Hoag explains the unique position of growth investing on the risk-return spectrum: it eliminates technology risk while retaining high growth potential.
Deduction and validation: The appeal of growth investing lies in "the least competition" and "the most interesting game." Jay Hoag believes that after a flood of capital poured into growth investing in 2021, much of it has proven to be "broken capital," and competition is actually declining.
Jay Hoag shared the sources of TCV’s resilience since its founding in 1994, the evolution of its investment process, and its organizational culture.
Deduction and Verification: TCV’s concentrated investment strategy demands a high hit rate but exposes the firm to the risk of failure in any single company. Signals to verify: the degree of disagreement within the investment committee and whether new investments consistently outperform the benchmark.
| Position | Analyst's View | Key Data |
|---|---|---|
| Netflix | Long-term hold, overweight | TCV held 43% stake at IPO; market cap ~$480B in 2025; TCV led restructuring financing in 2001 |
| Spotify | Long-term hold | No specific data given, but mentioned as a "legendary company" |
| Expedia | Long-term hold | Mentioned as a "legendary company", no specific data |
| Apple | Case study (positive) | "Declared dead" in 2000, today market cap exceeds $3 trillion |
| Microsoft | Case study (positive) | Investors "wandered in the wilderness" for over a decade, today market cap exceeds $3 trillion |
| NVIDIA | Case study (scale) | Market cap $2.8 trillion |
| Amazon | Case study (scale) | Market cap $2 trillion |
| Case study (scale) | Market cap $2 trillion | |
| Meta | Case study (scale) | Market cap $1.5 trillion |
| Stripe | Case study (private market) | Private tender offer, but no specific valuation given |
1. （Jay Hoag）Consumer Internet is an opportunity within "endangered species" : While everyone is frantically chasing SaaS and AI, consumer internet has been forgotten. But the base of 5 billion smartphone users has not changed; new consumer franchises are bound to emerge. "I don't believe the white space has shrunk."
2. （Jay Hoag）Technology commercialization requires caution against "overestimating near-term, underestimating long-term" : Technologies like autonomous driving and AR/VR typically take a long time to go from "usable" to "commercialized." The key is "applicability" rather than "usability" — there must be a clear profit model and a defensible moat.
3. （Jay Hoag）Every great company goes through a "desert of disappointment" : Apple was declared dead in 2000, and Microsoft "wandered" in the eyes of investors for more than a decade. Linear growth is the exception, not the norm. Investors must be mentally prepared for "doubt and criticism."
4. （Jay Hoag）Growth investing is the "golden middle ground of risk-return" : Early-stage venture capital carries a 30-50% loss rate but pursues 50-100x returns; private equity relies on leverage and cost cutting. Growth investing steps in after technology risk is eliminated, offering low principal loss risk while capturing high growth.
5. （Jay Hoag）Non-consensus and correct: that is the source of excess returns : In the quadrant of consensus vs. non-consensus, being non-consensus and correct often generates the largest returns. But "if you are wrong and non-consensus, it's really bad."
6. （Jay Hoag）The "lifelessness" of the IPO market is temporary but puzzling : Historically, there were 50-60 tech IPOs per year, and now the market has been sluggish for the fourth year. Massive private capital ultimately needs to be returned, but the widely accepted "permanent private market" assumption may not hold.
7. （Jay Hoag）The "pyramid" framework for investing in companies : Modeled after John Wooden's "Pyramid of Success," the core is "preparation, diligence, perseverance." His definition of success is "doing your best to become the best version of yourself" — not comparing with others, not comparing with the market.
8. （Jay Hoag）"Survivorship bias" in founder selection : Founders of successful companies need to be "a little crazy" and cannot "moonlight" or pursue "work-life balance." TCV focuses on identifying franchises that can build dominant positions over the long term.