Larry Aschebrook on Spotify, Uber and the Hard Lessons of Venture Secondaries

G Squared founder Larry Aschebrook joins Harry Stebbings to discuss the private-market investments that built his firm and the decisions that cost it money. His account moves between early secondary deals, concentrated bets, troubled portfolio companies and lessons he says investors can learn from both wins and losses.

Aschebrook grew up with little money and says paying for college required him to find a way to raise it himself. That early experience gave him an appreciation for the effort behind every dollar and helped shape the approach he would later bring to fundraising.

He began buying shares in private technology companies before he had an institutional fund. He describes using his own retirement savings and money from his wife to make the early investments, taking substantial personal risk before he had an established track record.

The first fund came together slowly. Aschebrook recalls raising approximately $35 million over several years, dialing potential investors and asking them to back a strategy that was still unfamiliar to many of them.

In retrospect, some of the early positions produced exceptional multiples, but their small initial size also illustrates the difference between a high percentage gain and a large amount of cash returned. For a young manager, getting into a company could be as important as the first check's size.

The early market was far less institutional than it later became. Employees and other holders sometimes wanted liquidity long before an initial public offering, and a buyer prepared to do the work could encounter opportunities that did not fit traditional venture fund processes.

Aschebrook says a small initial position could begin a relationship rather than guarantee access to confidential information. Building trust with a company and its investors gave him an opportunity to understand its needs and, sometimes, participate in later transactions.

Alibaba became a pivotal deal. Aschebrook describes buying secondary shares from a vehicle connected to Jack Ma's family office and assembling research despite the limited resources available to his young firm.

He used outside research support in India to help analyze companies. His point is practical: an investor with a small organization still needs a way to examine the business, understand the opportunity and make a decision, even if its process looks different from that of a large institution.

Secondary investing meant finding sellers as well as picking companies. Aschebrook recalls that the original portfolio was concentrated in a handful of holdings; each successful transaction could help establish credibility for the next one.

Looking back, he estimates that some early secondary shares could be bought at roughly 35 cents on the dollar compared with primary financing prices. That is his characterization of that period, not a discount investors should assume is available in every secondary deal.

The spread also reflected risk. Secondary buyers did not necessarily control when a company would go public, whether they could sell their shares, or whether the valuation in a later financing would hold up.

Aschebrook says relationships with founders and existing shareholders matter because the seller's circumstances differ from deal to deal. Solving a liquidity problem can create access, but it does not remove the need to assess the underlying business.

He contrasts a token stake that gets an investor acquainted with a company with a conviction position that materially affects fund results. A small check may open a conversation; building a large position requires capital, underwriting and a seller willing to transact.

Spotify illustrates how that process scaled. Aschebrook says G Squared first put approximately $4 million into the company, then developed the relationship further during a visit to Stockholm.

After an initial meeting, he was offered a much larger block of Spotify shares. The proposed transaction was around $150 million, an enormous amount for the firm at the time and far more than it could simply fund from existing resources.

Aschebrook recalls spending roughly 59 days raising $141 million for the purchase. To bridge the remaining amount, he says he borrowed $9 million personally from the seller, an unusually concentrated personal commitment to closing the deal.

The position represented about 40% of the firm's approximately $380 million third fund, according to his account. G Squared also arranged substantial co-investment, which should be understood as additional capital invested rather than a return.

He estimates the Spotify shares were acquired at around half the price of a concurrent round. He credits the outcome to conviction and the ability to execute a difficult transaction, while recognizing the concentration risk that came with making it.

Aschebrook describes Spotify as a major source of cash for his investors, citing roughly $1 billion returned across the investments he discusses. These are his retrospective figures; the interview does not independently verify the calculation or fully reconcile every vehicle.

The experience with Uber and Lyft was very different. Aschebrook says the firm lost roughly $50 million on Uber, recovering about 20 cents on the dollar on the investment he describes.

By contrast, he says the Lyft position returned roughly three times the money, with most of the stake sold before the IPO. The comparison is about his firm's entry prices and exit decisions, not a claim that Lyft became the larger or better-performing company overall.

A great business is not automatically a good investment at any price. Aschebrook says an investor must consider the price paid, the amount invested, the possibility of dilution and the route to actually distributing cash to limited partners.

He also distinguishes the quality of an investment decision from the eventual outcome. A sale can look prescient in hindsight, but at the time it has to be made with incomplete information and competing demands for liquidity.

Aschebrook points to the firm's 2018 vintage and its distributions as an example of the difference that actual exits make. He says it had returned close to the amount investors contributed, while other positions and distributions continued to affect the fund's ultimate result.

Discussing Coursera, he says G Squared held a significant stake at listing and returned hundreds of millions of dollars to investors. He also cites approximately threefold outcomes on Airbnb and Coursera; those are his deal descriptions, not independently audited fund returns.

The conversation turns to the exuberant 2020–2021 market. Aschebrook says his firm deployed heavily during that period and acknowledges that it paid too much for some assets. The mistake was not simply buying strong businesses, but underwriting them at prices that left too little room for error.

He describes the size of the firm's later fundraising and allocation decisions, and the pressure to put capital to work when valuations are rising. A large fund and abundant opportunities can make it harder to maintain the discipline that served a smaller investor well.

The resulting markdowns and difficult sales forced a reassessment. Aschebrook says investors have to acknowledge when the price was wrong, communicate the problem and decide whether holding, selling or putting more money in offers the best remaining outcome.

One approach he discusses involves supplying additional capital with negotiated structural protections. His example of a preferred return or multiple illustrates terms of a particular deal; it does not mean those returns were guaranteed or available in all investments.

Additional investment is not a way to make the original price disappear. It must stand on its own economics, including its position in the capital structure and the assumptions needed for the business to produce a return.

Aschebrook recounts considering a secondary transaction involving Theranos and becoming uncomfortable with what he saw in the process and management's behavior. He decided against proceeding with the planned purchase rather than treat the reputation of other investors as a substitute for his own judgment.

He says the aborted transaction led to a threatening dispute that was resolved at personal cost. He corrects the characterization of a formal lawsuit and describes paying a few million dollars to settle; the account should not be read as a claim that he had established fraud at the time.

The episode reinforced his view that an investor must be able to walk away, even after substantial work and money have gone into a deal. The pressure to close is especially strong when a highly regarded company appears difficult to access.

Aschebrook connects those experiences to the limits of a secondary investor's information. Relationships can improve understanding, but not every question will be answered, and the absence of full control makes judgment about people and transparency especially consequential.

The loss on 23andMe offered another kind of lesson. Aschebrook says the firm's exposure was around $100 million and that an opportunity to sell at roughly twice the investment passed before the value fell sharply.

He estimates the eventual loss at about $70 million. In his telling, the problem was not only an adverse market but a decision to keep holding when an attractive liquidity opportunity was available; the figures are his account of that investment.

Getir and Gorillas presented a more complicated sequence. G Squared had invested in Gorillas, which was sold to Getir, and Aschebrook describes putting further capital at risk as the combined business encountered difficulties.

He speaks candidly about the effect of the situation on him and his limited partners. The outcome involved not just invested cash but the burden of managing a troubled holding and keeping investors informed when the news was unwelcome.

Aschebrook calls secondary investors the 'janitors' of venture capital: they can help clean up difficult cap tables and supply liquidity where others cannot. It is a service to sellers, but a buyer still has to price the asset and bear the possibility of a loss.

He says concentration in a small number of companies creates meaningful risk despite the apparent diversification of individual transactions. A portfolio can contain many lines on a statement while most of its value depends on a handful of outcomes.

In discussing Getir's wider consequences, Aschebrook includes an estimate of lost future fundraising opportunity alongside invested capital. That opportunity cost is hypothetical and should not be treated as an additional realized investment loss.

His response to a bad investment is to communicate directly with limited partners instead of hiding behind reporting language. He argues that trust depends on explaining what went wrong, what remains uncertain and what he is doing about it.

A secondary investor may be able to buy at a discount, but a discount alone cannot make a bad business good. The price, business prospects, rights and likely timing of liquidity all matter, particularly when markets become less forgiving.

Aschebrook says the firm's approach to co-investment has evolved toward opportunities connected to core fund positions. Co-investors provide separate capital, so their investments and outcomes should not be confused with the size or return of the main fund.

That discipline reflects a change in scale. As a fund grows, the manager has to decide how to allocate scarce attention and capital, not just how to find another transaction. Concentration can amplify the benefit of a good decision and the cost of a poor one.

Turning to Revolut, Aschebrook recalls getting involved in 2018 and argues that the company built a powerful consumer finance platform. His assessment comes with an investment interest: G Squared has backed companies in the sector.

He compares opportunities in European fintech, including Monzo, through the lens of valuation and business growth. His comments about entry prices and future prospects reflect his view at the time of the interview rather than a guarantee of what any holding is worth now.

The conversation shifts to the latest financing environment and companies that need large amounts of capital to grow. Aschebrook sees opportunities for investors who can provide liquidity and follow-on funding, but acknowledges that market prices can change quickly.

Asked about Anthropic at a $61 billion valuation, Aschebrook says he would buy. He also says he owns Anthropic shares acquired through the FTX bankruptcy process, so his bullish assessment is accompanied by a direct financial interest.

He discusses Anthropic alongside other leading AI and infrastructure companies, including OpenAI and Databricks. His views about which companies will win are predictions about a developing market, not established facts or assurances about investment performance.

Aschebrook separates companies he calls 'vampires' from 'zombies' as a way to think about the coming shakeout. In his framework, some businesses can continue attracting capital and resources while others may struggle to finance themselves despite remaining operational.

He expects the funding environment to reward companies with credible growth and access to capital more than those sustained by a previous valuation. That is a forecast, and he recognizes that individual outcomes depend on how each business performs and raises money.

Aschebrook returns to the power of early access and patient ownership, citing companies such as Spotify and Wiz. Large multiples on private holdings, however, can include unrealized gains and depend on valuation as well as the eventual price and timing of a sale.

He also discusses Bolt in terms of a potential six- to sevenfold result. The multiple is an estimate or scenario in the conversation, not evidence that those proceeds have already been distributed to investors.

Asked whether money makes him happy, Aschebrook connects his drive to the insecurity of his upbringing. Financial success changed his circumstances, but he describes self-awareness, family and how he treats other people as matters that money cannot settle on its own.

He reflects on the personal cost of ambition and the habit of measuring himself against external success. His advice is to recognize the motivations behind that drive rather than assume that a bigger number will automatically resolve the anxieties that produced it.

The conversation turns to leadership and the value of interpersonal skills. Aschebrook says investors have to work with founders, colleagues and limited partners through difficult moments; the ability to communicate honestly becomes especially important when a deal is not working.

In the quick-fire round, he discusses influences including Cal Ripken and the appeal of showing up consistently. He also reflects on leadership decisions and the challenge of building an organization as responsibilities change.

His assessment of mistakes is that a manager should own them, learn from them and avoid using a good headline result to obscure the weak decisions underneath. A record is made up of both realized wins and the losses that investors actually bear.

Aschebrook returns to distributed capital as a measure of performance. DPI compares cash distributed with paid-in capital; in contrast, a reported portfolio multiple can include unrealized value and therefore depends in part on marks and future exits.

He does not argue that every multiple is meaningless: the distinction is between money returned and value still held. He favors looking closely at realized distributions when assessing whether a venture manager has converted paper gains into cash for investors.

Aschebrook closes by emphasizing openness, self-reflection and the productive side of remaining alert to risk. For him, the lessons of a long investing career come from examining both the deals that worked and those he wishes he had handled differently.