VC Geoff Lewis on moving to Austin and popping Silicon Valley’s ‘self-referential’ bubble
August 18, 2021 at 17:31 PM EDT
"I don't believe everyone should move to Austin. I don't think it's right for everyone, but I do think it's right for us."
Austin has made headlines over the past year for a number of reasons: It’s home to Oracle’s new headquarters. Tesla is building a massive gigafactory in the Texas capital. People, mostly tech workers, are leaving the Bay Area in droves to settle in the city, driving up home prices in the process.
But, it’s not just tech workers. A number of venture capitalists have set up shop in Austin, including Jim Breyer of Breyer Capital and Palantir co-founder Joe Lonsdale, who said last year he was moving his venture capital firm, 8VC, from Silicon Valley to the city.
‘I don’t believe everyone should move to Austin. I don’t think it’s right for everyone, but I do think it’s right for us.’
The latest VC to call Austin home is Geoff Lewis, founder and managing partner of Bedrock Capital, a 4-year-old early-stage venture capital firm with $1 billion in assets under management. Lewis started his investing career at Founders Fund, where he was a partner for several years. He either serves or has served on the board of companies such as Lyft, Nubank, Vercel and Workrise.
Lewis also led early investments in Wish, Upstart, Tilray, Canva, Rippling, ClearCo, Flock Safety and a number of other unicorns. He’s largely credited with popularizing the phrase “narrative violation” to describe promising companies that are overlooked or underestimated because they are incongruent with popular narratives.
In making the move to Austin, the investor said he had grown disillusioned with Silicon Valley and the region’s continued lack of focus on solving what he described as real-world problems.
In a Medium post, Lewis said he was first introduced to Austin after backing Workrise (formerly called RigUp), a marketplace for skilled trade workers. In fact, he was the company’s first seed investor eight years ago and has gone on to invest in the company eight subsequent times. Today, Workrise is valued at nearly $3 billion.
Lewis said he was drawn to the company not just because it was “going to be huge” but also because it was “much more concerned with real people and real places than today’s Silicon Valley behemoths.”
“Put simply, it is a more humane technology company,” Lewis writes. “And it’s my search for this more humane genre of technological innovation that brought me to Texas. I’ve lived on the coasts and built my career as a Silicon Valley technology entrepreneur and investor, but I’ve never felt of the coasts or as an insider in Silicon Valley — I didn’t go to Stanford nor grow up rich.”
TechCrunch talked with Lewis to get more details around his decision to move his firm to Austin, learn more of his views on why Silicon Valley is too much of “a bubble” (spoiler alert: they may not be popular with many of you!) and how he plans to invest in more of Texas’ nexus of startups.
This interview has been edited for length and clarity.
I understand that you grew up in Canada. How did you first get involved in the tech industry to begin with?
I started off as an entrepreneur myself, building a SaaS company in the travel space [Topguest]. I founded that business in New York City, and in 2009 ended up moving my team to San Francisco. I spent most of my career from 2009 to 2021 bouncing between New York and SF. We ended up selling that company in 2011 and it was a reasonably OK outcome. I joined Founders Fund in 2012, where I just fell in love with investing. I ended up really having a special trajectory there and 2012 was a great time to be a young VC in San Francisco and Silicon Valley. I ended up specializing in marketplaces, both consumer and enterprise, backing companies like Lyft and Canva early. I also did the firm’s first fintech investment in Latin America, backing Nubank, and now that company has a $30 billion valuation.
I grew up with pretty modest means and by 2017, I figured I had done well enough as a VC and I should strike out on trying to get back to what I wanted to do, which was more entrepreneurial. So we founded Bedrock in late 2017. We’re on Fund III now and it’s been consistent with the investment philosophy I pursued — trying to find what we call narrative violations, or these counternarrative companies that are being overlooked or underestimated. We were very early investors in Cameo, which is now obviously a pretty well-known business, for example.
You initially chose to base Bedrock in New York. Why?
When I was at Founders Fund I had a home in both cities (SF and NYC), so I was the kid who grew up in Calgary, Canada and wanted to live on the coasts and be in the center of the action. But we decided to actually headquarter Bedrock in New York in 2017 because we had an inclination that Silicon Valley was becoming a little bit overly self-referential and wanted to be a bit outside of the noise. New York is less of a one-horse town, so we decided to base the firm there, but really invested in, and continue to invest, everywhere across the country and quite honestly around the world. We invested in WordPress in the early days and more recently in Argyle and Lambda School.