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Colossus (Invest Like the Best / Business Breakdowns)Podcast17 Nov 2020Source: traffic.libsyn.comHost: Patrick O'Shaughnessy

Niki Scevak - Wild Hearts and Wild Ideas - [Invest Like the Best, EP.200]

In plain words

This interview discusses investor Niki Scevak's approach: he backs founders with "wild hearts" and "wild ideas" — people who treat their startup as a lifelong mission. He believes in investing in companies, not rounds, building relationships early that later beat brand and reputation. He is optimistic about the Australia-New Zealand market, where distance forces a unique strategy: let the product sell itself. Key holdings: Canva (held from seed; charges users to do less), Zoox (invested in 2014 for self-driving taxis), and Atlassian (early pioneer of user-driven growth).

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Blackbird Ventures co-founder Niki Scevak articulated his investment philosophy in the program: seeking "wild hearts" and "wild ideas," investing in founders' lifetime endeavors rather than mere funding rounds. He focused on the uniqueness of the Australia-New Zealand market and shared insights on g

~12 min full read · 7 sections
Deep Analysis

This Issue at a Glance

Niki Scevak (Co-founder and Partner at Blackbird Ventures) elaborates on his investment philosophy: seeking founders with "wild hearts" who are committed to a lifelong mission, and grand visions that are "wild ideas." He focuses on analyzing the uniqueness of the Australia-New Zealand market — where geographic distance and time differences have fostered a "bottom-up" product distribution model — and delves into the business model, customer acquisition strategy, monetization path, and moat of his portfolio's star company, Canva. The most impactful takeaway from the entire episode: Niki believes that "investing in companies, not in rounds" is an unconventional but optimal strategy — early-stage relationships and deep observation serve as a competitive advantage that outpaces brand and reputation in later stages.


Theme 1: Wild Heart and Wild Ideas – Investing in a Lifelong Career, Not a Funding Round

Niki believes that the greatest companies begin with a founder’s mission as a "lifelong career," rather than a standardized CEO template "cast from the center."

  • Characteristics of a "Wild Heart": Founders do not fit the traditional "qualified CEO" profile—Google’s founders were fresh out of college, while Microsoft and Facebook’s founders never completed their studies. Niki prefers to invest in those who are "hungry rather than already proven."
  • Clues to Identifying a Lifelong Career: Observe the founder’s time commitment before starting the venture. Take Canva as an example: CEO Melanie Perkins was teaching design courses and founded the high school yearbook business Fusion Books before creating Canva. These "clues" indicate that she had long been preparing for the mission of "democratizing design."
  • The Role of a "Wild Idea": Peter Thiel calls it a "charismatic vision." Niki believes that grand ambition itself is a "honey pot for attracting the best talent"—the best employees, investors, and partners all rally around the mission. "If you only have half the ambition, you only have half the probability of success."
  • Case Study: Zoox — In early 2014, founder Tim Kentley-Klay proposed building a fully autonomous self-driving taxi (software + hardware + consumer service). At the time, it was a "crazy idea," but it was precisely this ambition that attracted a top-tier team.

Deduction and Validation: Niki believes that in non-U.S. markets such as Australia and New Zealand, founders often lower their ambitions due to a lack of confidence—this is a trap. Lowering ambition does not increase the success rate; instead, it decreases it. Signal: Whether a founder can articulate the "idea maze" in clear language and whether they have deep reflection on the mission are forward-looking indicators of their success.


Theme 2: An Unconventional Strategy of "Investing in Companies, Not Rounds"

Niki believes that the venture capital industry is fragmented by the "round" structure, while Blackbird chooses to invest in "companies" — from seed through later stages. This strategy is rooted in a belief in the depth of relationships and information advantages.

  • Industry ills: Early-stage funds want to "invest before knowing success, and not invest after knowing success," while later-stage funds rely on quantitative analysis. Niki argues that the accumulation of "bad news" is the most valuable later-stage investment information — observing how founders build teams, how products interact with the market, and which are the high-quality customers. This information is more scarce than quantitative skills in the later stages.
  • Relationships are the true moat: Once a company's success becomes obvious, the world's top investors will all rush in. But relationships built early defeat brand and reputation at that point. Niki uses an analogy: "Everyone remembers the teacher in high school who changed the way they thought" — early-stage investing is the starting point for building such influence.
  • Disagreement with Benchmark: Niki acknowledges Benchmark as a top investor, but he believes that even if Benchmark invested in its "generational companies" at every round, it would not increase time or relationship costs — the skill differences across stages are overestimated.

Deduction and Validation: Niki judges that the core assumption of the "invest in companies" strategy is: relationships are "non-scalable," but capital is "the most scalable." Therefore, Blackbird focuses on a few companies and invests hundreds of millions of dollars across their entire lifecycle. Falsification condition: If Blackbird fails to obtain better terms than competitors in later stages due to its relationship advantage, the strategy fails.


Theme 3: The Unique Advantages of the Australia-New Zealand Market – From "Bottom-Up" to Global Software Companies

Niki explains that the geographic isolation and time zone differences of the Australia-New Zealand market have instead fostered a unique customer acquisition philosophy of "making the product the salesperson," giving rise to global software giants such as Atlassian and Canva.

  • Constraints breed innovation: Australia is far from the global market, and its time zone is opposite to that of most customers. This forced founders to abandon the traditional path of "selling to the CIO" — since it was impossible to conduct phone sales during non-overlapping hours and difficult to manage a remote sales team — and instead adopt a strategy of "letting the product sell itself."
  • Bottom-up customer acquisition model: Let employees who actually use the product (rather than senior decision-makers) try it for free, then pay via credit card (rather than large contracts). Atlassian was an early pioneer — they bought the keyword "Enterprise Wiki" for just 10 cents per click (now costing $100 per click), using this "time arbitrage" to acquire early users.
  • "Playbook" is a dirty word: Niki emphasizes that if a customer acquisition strategy is a "playbook," it means too many people have already successfully replicated it, and you are too late. Good customer acquisition strategies sound "weird" or "unique" — for example, making "content marketers" early users of Canva, who then naturally create a large amount of content and share it, forming an organic viral flywheel.
  • Current trends: AI is lowering the cost of software, allowing founders to reimagine existing products and solve problems that could not previously be addressed with software — such as autonomous driving, medical diagnostics, and drug discovery. Many Australia-New Zealand founders are also competing in these fields.

Extrapolation and validation: Niki believes that the Australia-New Zealand market will not win the most "gold medals," but it will win an increasing number — this contradicts the traditional "Silicon Valley only" view. Signal: Whether more "generational companies" (such as Canva, Atlassian) emerge locally, and whether Blackbird can translate its local experience into global competitiveness.


Theme 4: Deep Dive into Canva — The Business Model from "Free to Use" to "Paying to Do Less"

Niki, through the "Breakdowns" segment, dissected Canva's business model, customer acquisition path, monetization strategy, and moat in detail.

  • Product Essence: Canva is a "graphic design platform" that allows anyone (no design degree required) to create professional designs. Its core insight is "adjustment/customization" rather than "creation" — users start from templates, not a blank canvas, which lowers the barrier to design.
  • Early Customer Acquisition: Canva adhered to a "delayed launch" strategy — in 2011, it abandoned an early launch and spent an additional 6-9 months polishing the product. Early users were "content marketers", who naturally shared their usage experiences on social media, forming a self-organized community of "Canva Love". SEO was not the starting point, but a tool to amplify user enthusiasm.
  • Monetization Evolution:
  • Phase 1: Users paid when using paid assets (e.g., $1/image), but most designs were free.
  • Phase 2: Launched the "Magic Resize" feature — automatically resizing designs for different platform dimensions (Pinterest, YouTube, Facebook, etc.). Users paid to "do less" — limit available options to increase efficiency. This became the core of Canva Pro subscriptions.
  • Phase 3: Canva for Enterprise — providing brand guidelines, asset libraries, and templates for teams, so employees "can only use this version of the logo, this version of the color palette." Users paid to "use less of Canva."
  • Moat: Niki believes that the most difficult thing to replicate is the "product roadmap" — Adobe and numerous startups try to copy Canva's current features, but cannot replicate its product evolution over the next 10 years. Additionally, the content flywheel (community-contributed templates, assets, images) and the spontaneous organization of the user community (e.g., organic YouTube tutorials, "Canva Love" on Twitter) constitute hard-to-replicate network effects.
  • Organizational Building: Canva's uniqueness lies in "designing the company, not just designing the product" — they cultivate internal talent rather than bringing in "mercenaries", and adopt a "team of teams" structure, maintaining rapid iteration even with over 1,000 employees. Every level has an advisory board (e.g., global advisors for the internationalization team), not just the founders having advisors.

Extrapolation and Validation: Niki believes that "whether you love the product roadmap" is the single most important metric in a lifetime investment decision — in Canva's board presentation materials, even when ARR reached hundreds of millions of dollars, product-related slides still accounted for 90%. Signal: If the proportion of product slides in Canva's future board presentations declines, it may indicate waning innovation momentum.


Mentioned Positions

Position Guest View Key Data
Canva Bullish (heavy position held from seed round to present) Hundreds of millions of dollars ARR; initial funding round had 97 people investing $29 million; early $1 per paid asset model; Magic Resize feature drove subscription growth
Zoox Bullish (invested in early 2014) A "crazy idea" in 2014 — fully autonomous robo-taxis (software + hardware + consumer service)
Atlassian Background mention (as early pioneer of bottom-up customer acquisition in Australia/New Zealand) Bought the keyword "Enterprise Wiki" for just $0.10 per click (now $100 per click)
SafetyCulture Mentioned as a case study (as an example of pricing strategy) After tripling the price early on, conversion rates actually increased — users thought the product was "too cheap"

Judgments Worth Remembering

1. “Invest in companies, not rounds”—relationships are the true moat in later stages. (Niki Scevak) Relationships started early can beat brand and reputation in later stages; capital is the “most scalable,” while relationships are “non-scalable.” That is why Blackbird focuses on a small number of companies and stays with them through their lifecycle.

2. “If you have only half the ambition, you have only half the probability of success.” (Niki Scevak) In non-US markets, founders often lower their ambitions due to lack of confidence — but that is a trap. Lowering ambition does not increase the success rate; it lowers it.

3. “The playbook is a dirty word.” (Niki Scevak) If the customer acquisition strategy is a “playbook,” it means too many people have already replicated it successfully — you are too late. A good strategy sounds “strange” or “unique” — for example, making “content marketers” the early adopters and letting them naturally create distribution content.

4. “Gross margin is the margin of safety — software companies are in a long-term downtrend.” (Niki Scevak) High gross margins (like software companies) are “training wheels” — even with rapid growth, the risk of failure is low. A business with low gross margins or one that requires inventory may see growth actually bring the risk of death. But the GPU cost brought by AI is compressing software gross margins, which may be further squeezed by competition in the future.

5. “Users pay to do less.” (Niki Scevak) Canva’s monetization logic is counterintuitive: the Pro version restricts users’ available options (brand guidelines, templates), and the enterprise version restricts the team to only specific versions — users pay to avoid the efficiency loss caused by “infinite choices.”

6. “Whether you love the product roadmap is the single most important investment metric.” (Niki Scevak) The proportion of product slides in a company’s board deck declining over time is a dangerous signal. At Canva, even after reaching hundreds of millions in ARR, product slides still accounted for 90%.

7. “Naivety is a good thing.” (Niki Scevak) If founders fully understood the realities of the industry, they would never start a company. “Unqualified” founders (e.g., those who did not finish school) are able to reshape industries precisely because they do not know what is “impossible.”

8. “Invest in the founder’s lifelong career, not in a funding round.” (Niki Scevak) Identifying clues: whether the founder had already invested significant time before starting the company (e.g., teaching design, running a yearbook business), rather than “parachuting in” an idea.