GP Interview: Latif Peracha
Latif Peracha is a partner at M13 and lives in the New York City area. This is his Emerging Manager interview.
👉 Big Learning Up Front (B.L.U.F.): 36-hour feedback turnaround time is better for founders and creates more clear space for the fund.
Latif, tell us about yourself
I was born and grew up in the suburbs of Detroit, the product of a Pakistani father and Palestinian mother who met in Michigan in the 70s. After graduating from the University of Michigan, my professional life has been based predominantly in New York. Prior to joining M13 as a General Partner 2 years ago, I spent the previous 8 years working at Virgin Group, where I managed our US portfolio including investments in Virgin Galactic, Ring, Slack and Capsule and many others.
My life revolves around work and family, as well as a few very simple pleasures: music, University of Michigan athletics, and long, therapeutic runs. I live in the New York area with my wife and two young boys who are the beginning and end of everything.
Describe your fund, M13
M13 is an early stage consumer technology fund based in Los Angeles and New York. We are currently investing out of a $188M fund and we predominantly lead Seed and Series A rounds with an average investment of $5M. Our investment thesis is predicated on understanding how advanced technologies will drive consumer behavior change across large verticals including e-commerce, healthcare services, and financial services. Our ethos is very operator friendly and we have invested significantly into our platform team (called Propulsion) that we believe will improve the probability and magnitude of our companies’ success
The one portfolio company I would highlight is Feelmore Labs which is leveraging proprietary non-invasive neurostimluation technology to significantly reduce stress and anxiety. We believe this technology can be leveraged to also improve sleep and cognition and the company has recently launched its D2C strategy while also building out its clinical strategy. It is a great example of a business that is advancing a secular trend we deeply believe in (mental health) through a differentiated technology and a passive behavior that is more in line with the consumption habits of today’s consumer.
Share one big learning or process improvement you’ve used individually or as a team which has made you a better fund manager
One process improvement that we have really focused on as a team is rapid turnaround time and clear feedback to entrepreneurs. We get back to companies within 36 hours with feedback including any potential next steps. We also go to great lengths to make sure this feedback is detailed and not the standard BS. As any fund manager knows this takes A LOT of time. But it puts the onus on us to ensure we are only taking meetings with companies that we know fit in our thesis. We are in the business of saying no and doing so with grace and with detail is the least we can do for these founders. Doing so quickly also helps the founder and gives our team more collective headspace to engage in new opportunities.
The other thing I have tried to implement - but admittedly I have struggleld with lately - is blocking off 3 hours per day to do real work: thinking about and responding to prospective companies, reading about themes, calling existing portfolio CEOs, and allowing for serendipity. This is a work in progress.
Which founder from your portfolio has had the greatest impact on you and why?
There are many but the founder who has had the greatest impact on me is Jamie Siminoff, the founder of Ring. My current firm M13 made a seed investment in Ring and I co-led the Series B prior to joining while I was at Virgin Group. It is safe to say that without Jamie I would not have gone deeper into venture and certainly not at M13 as he was a big part of our connective tissue.
Jamie taught me you need to back founders that are mission driven, and are pure in their relentless pursuit of that mission. Some founders are loud like Jamie, others are quieter but that hyper focus on that single thing needs to be a borderline obsession for all of them. We also had a lot of fun and it is important to get along with your founders on a personal level as the road is long and undoubtedly arduous.
What’s one thing you wish you knew before you became a VC?
How much selling you have to do! To founders, limited partners, your own partners. You always need to convince someone of something while you are usually still figuring out exactly how you feel.
Tell us the story of a rabbit hole you recently fell deep into
I have been thinking a lot about physical retail. Physical retail is still approximately 85% of total commerce and while that number will continue to decrease, it will probably still make up over half of total retail for our lifetimes. I think it is a highly under-innovated market and the relationship between tenants and landlords needs revision. When I walk around the streets of New York and see the retail destruction it makes me think there must be a better way to share in risk and upside as we come out of the rubble of COVID. At the same time digital marketing is very commoditized and expensive, so how can brands break through? Physical manifestations will play a part. What is the retail version of WeWork and why doesn’t it exist? Who is using software to enable this? (ps. The world needs WeWork more today than ever!) I’m not sure this is a rabbit hole per se but it is something I spend a lot time thinking about and can’t shake.
Name one GP and one LP everyone should learn from -- and whom we should feature next
GP: Roger Ehrenberg, IA Ventures. Not only is he a very proud fellow University of Michigan alum, he is one of the best investors in the world. The firm he founded, IA Ventures, does it their way, and IA knows how to generate returns for their investors time and time again (including The Trade Desk, Datadog, Digital Ocean, Transferwise and many many others). Roger builds deep conviction and is a high concentration investor (ie takes less swings which is not easy to do at the seed stage). He also really gives back to the community and has been a great mentor to me and many other GPs over the years. He does this quietly and asks for nothing in return. Thank you Roger.
LP: Craig Thomas, Investure. He is not an investor in our fund but someone I have really gotten to know and respect over the last couple years. He is very transparent and honest, and really has his ear to the market. He often knows about our latest investments well before they are announced! He is also on the younger side for LP land and I think it would behoove limited partners to have more young people making decisions as they have a good sense of the markets and managers of the future. He has also put out some great content on portfolio construction and I often go to him for advice. Thank you Craig.
Finally, what are the 3 best emojis?
🔥 🤣 ❤️
Latif Peracha is now on the EM roster at EmergingManager.vc. << View all these EMs, learn from them and then teach me some new things. I want to thank Latif for spending the time with me on this. I met Latif when we were in undergrad at the University of Michigan in Ann Arbor around the year 2000, and we’ve been close friends ever since as we’ve both built our funds. He’s been an unwavering friend. Latif’s contacts: firstname.lastname@example.org and @latifperacha or LinkedIn. Thank you, Latif — Reilly