Alfred Lin doesn’t just accept contradictions; he searches for answers within them.
Less than five minutes after sitting down, he and I are talking about examining contradictory ideas simultaneously. It’s a framework F. Scott Fitzgerald famously wrote about in 1936: "The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function."
And Lin, who just celebrated his 14th year at Sequoia Capital, thinks there are practical reasons to consider extremes.
"The thing about holding things in tension, in extreme tension, is that the right answer is almost definitely somewhere in the middle," said Lin. "Even if it leans one way or another, whatever you’re trying to do, your answer is probably somewhere in the middle. But if you start in the middle and radiate out from there, you think 'oh, this is obvious, it makes sense.' Then you limit the number of solutions you look at. If you look at the extreme and work towards the center, you traverse almost every single possibility. That’s why when people hold things in tension they tend to come up with more options."
Lin holds a unique distinction in Silicon Valley. He’s one of the most successful investors at one of tech's most storied VC firms. He’s been Sequoia’s lead investor in DoorDash, Airbnb, Citadel Securities, and Reddit. The last time Lin talked extensively to Fortune was in 2021, when both DoorDash and Airbnb went public within just a couple days of each other. Another idea to hold in tension—Lin also led Sequoia’s investment in FTX, the collapse of which sent shockwaves through crypto and tech. (Lin said last year that the firm was misled.) Nevertheless, Lin remains widely regarded as the best of the best, a remarkable distinction in the long-game venture business.
Sitting across from Lin, in Sequoia’s San Francisco space above a chocolate factory, he sounds like the mathematician he nearly was. Lin TA-ed statistics courses in undergrad and grad school, and he noticed that the more advanced the math got, the more concerned it was with extremes. Lin may have dropped out of his Stanford Ph.D. to join LinkExchange (which sold to Microsoft for $265 million in 1998) but in his way, he still does some teaching: Last week, at Sequoia’s pre-seed and seed company-building program Arc, he taught a session on outliers.
What's an outlier? Can you know when you meet one? Lin sees spotting outlier founders as an endeavor both mathematical and human, broad and deeply individualized.
"The wrong way to think about math is that it’s just numbers or it’s just abstract," he said. "But when you study math, it’s more about patterns, seeing an insight that nobody else has seen before...And I try to see that in people. We often talk about outliers. In statistics terms, an outlier is four standard deviations away from the mean, and it could be in a positive or negative direction. They’re both outliers…But there’s also a difference between abnormalities and outliers. Is this a real signal versus just noise? If someone’s spike is being super competitive in weightlifting, is that a real outlier? You’ve got to differentiate that. I try to find out why someone's different. I think most founders want to talk about how they're similar to all other founders."
Part of the key seems to be that someone’s outlier trait, whatever that is, is somehow uniquely suited to the problem they want to solve. Lin’s well-aware this isn’t easy to pin down.
"It's hard to describe what an outlier is," he said. "But the person has to have a spike, and that spike has to be in the direction that makes sense for the market that they want to go after."
Lin seems wary of oversimplifying people, as a general rule, and deeply attuned to the through-lines between past and present. The way I see it, he operates with a mathematical framework, then uses that framework as a jumping-off point to dive into individual founders’ stories and businesses. (Again, two contrasting ideas at once.) So, Lin has filters—and then he goes from there.
"In seed, we're looking for three things," he told Fortune. "We’re looking for an outlier team, authentic and compelling insights, and positive market dynamics."
There are also general features that startup-ready outliers are likely to have, he says. These range from adaptability to work ethic to the ability to attract followers. Lin’s a believer in "founder-market fit," the idea that there needs to be alignment between the founder and the market opportunity they’re pursuing. He's interested in a vision, sure, and wants to see how that vision is connected to reality and executed upon—but Lin believes founding a company is a team sport.
"I don't think every person can do all three, but when you assemble a founding team, they can do all three," said Lin. "If you look at Airbnb, today, it looks like Brian Chesky. But let’s not forget that Brian will tell everyone it was Joe’s idea. It was not his idea, so without Joe that would have never happened. And without Nate, that technology would have never been built."
Lin is very open, but he's hesitant to be prescriptive. It’s one final contradiction to hold in tension. He both wants to help prospective founders, but doesn’t want to give them (or me) too much information, lest he encourage imitation. When I asked Lin what his best first meeting with a founder was like, he smiled but didn't give me a direct answer.
"If I tell you and you publish it, and then everybody tries to be that," Lin said, "my screening process will fall flat on its face."
Elsewhere…The Fortune Most Powerful Women Asia list was just unveiled, and my colleague Nicholas Gordon interviewed Singaporean VC Jenny Lee, an investor in Alibaba, Didi, and Xiaomi. Here’s what she had to say about strategy, geopolitics, and more.
See you tomorrow,
Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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