Jay Hoag - Calibrating Market Adoption

Principles & Lessons:

• Embrace early learning and calculated risk: Jay’s early experience as a research analyst in 1982, when he "started not knowing anything about anything" and chose to cover technology despite limited knowledge, taught him that taking calculated risks is essential—especially when his boss warned that he “would be of no value to him until I had lost money on a recommendation”—instilling a mindset where early mistakes become vital learning opportunities in a rapidly evolving field.
• Understand the dramatic evolution of scale: Reflecting on the early ‘90s, Jay notes that the entire venture industry raised under $2 billion and TCV’s first fund was only $100 million, contrasting sharply with today’s multi-trillion-dollar market caps; he observes that “everything’s changed” and that appreciating the massive scale and growth dynamics of technology is crucial for informed decision-making.
• Prioritize long-term, growth-stage investing: Jay emphasizes that TCV’s strategy is built on investing in companies that have moved past early-stage risk and are on a clear growth trajectory—focusing on the “combination of growth stage and a crossover investing” approach—and believes that a long-term perspective, one that “provides tremendous returns” over decades, is key to capturing the full potential of transformative technologies.
• Focus on enduring value propositions and product-market fit: In evaluating companies, Jay uses a framework that looks for a unique value proposition—combining “value, convenience, and selection”—alongside strong engagement, network effects, and execution, as exemplified by early Netflix’s transition to a subscription model; this holistic view ensures that investments are directed toward businesses with sustainable competitive advantages and real consumer appeal.
• Back visionary founders even if their ideas seem unconventional: Jay highlights that many breakthrough companies, like Airbnb and Netflix, initially appeared illogical or even “batshit crazy,” yet their founders’ contrarian visions unlocked massive opportunities; he advises that if an idea seems “somewhat crazy” but shows signs of aligning with future trends, it warrants deeper investigation, as visionary leadership is often a critical catalyst for success.
• Act as a supportive strategic partner through turbulent times: Emphasizing the importance of partnership, Jay explains that investors must balance tough, thoughtful questioning with genuine support—working “through thick and thin” with CEOs to navigate both setbacks and successes—so that during challenging periods, the focus remains on solving problems together rather than merely pointing out flaws.
• Leverage insights from both private and public markets: Jay articulates that TCV’s crossover investing model creates a valuable feedback loop, stating that “being a private investor makes us better public market investors” and vice versa; this dual perspective allows them to filter out short-term noise in public markets and concentrate on long-term fundamentals, enhancing overall capital allocation and strategic decision-making.
• Invest in talent density to drive sustained innovation: Jay believes that surrounding oneself with “stunning colleagues” is a key differentiator in building and scaling great companies, as high talent density fosters vigorous debate, continuous learning, and an environment where even unconventional ideas can thrive—ensuring that the collective “magic” of the team propels long-term success.

Transcript