Charlie Songhurst – Lessons from Investing in 483 Companies - [Invest Like the Best, CLASSICS]
Episode publishedPodcast: Invest Like the Best with Patr...Invest Like the Best with Patrick O'Shaughnessy
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Welcome to this classic episode. Classics are my favorite episodes from the past ten years published once a month. These are n of one conversations with n of one people. Charlie Songhurst is a brilliant strategist, an accomplished executive, and a prolific angel investor. It's one of my all time favorite conversations, not just on the podcast, but period. I hope you enjoy it. Here's a puzzle. What do OpenAI, Cursor, Perplexity, Vercel, Plaid, and hundreds of other winning companies all have in common? The answer is that they're powered by today's sponsor, WorkOS. If you're building software fo
O'Shaughnessy is the CEO of Positive Sum. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of Positive Sum. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of Positive Sum may maintain positions in the securities discussed in this podcast. To learn more, visit psum.vc. My
guest this week is Charlie Songhurst, the former head of strategy at Microsoft and a prolific investor, having personally invested in nearly 500 companies through his career. I met Charlie at an event hosted in New York, and you can tell within one minute of meeting him that his mind is sparkling with ideas and curiosity. It's no wonder he's been among the most commonly requested guests when I asked several top investors and CEOs who I should have on the show. We discussed the lessons he's learned about business investing in people from such a large sample size of companies. I won't reveal any
So it's a two part question. One is the virtues, which is working with people you like, working on amazing problems and having impact, and then the three vices, power, money, and fame. And you can't avoid them, they have to be stacked going separately. And it's always really trying to get at the differences between there's no good answer, but there are definite good fit answers. So someone who's interested in power tends to be better at execution. Someone who's more interested in money tends to think more about some capital efficiency. I tend to avoid people interested in fame. But, if you wer
impact. Any especially memorable or interesting series of answers that you've gotten on the two stack ranks that come to mind?
A lot of people have negative utility from fame. A lot of people start with power and then when you push them, it's actually money but they don't want to say it. And that's more true outside of The US culture than it is in The US. It's particularly true with Europeans. And so a lot of it is trying to get people to actually say what they truly believe as opposed to say what they think they should say.
I'm curious in what context, whether it be interviewing prospective founders, interviewing potential hires, or others, you find it most interesting and useful?
All of the above. The founder one is fascinating because you actually end up going down different lines and helping them depending on whether they answer the power and the money. Founders that answer power tend to need help more on managing their start up capital efficiently. They tend to be the ones that spend more. They tend to be the ones that over expand. They're often too aggressive. Conversely, the ones that don't have money tend to be very capital efficient, but often slightly too cautious, slightly underaggressive, sometimes not willing enough to stamp their authority on the company an
When it comes to hiring or evaluating founders, apart from this two part stack ranking, are there ot
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