Lerer Hippeau's Ben Lerer on Funding Crazy Founders Over Good Companies

Ben Lerer, Managing Partner and Founder of Lerer Hippeau, discussed his early-stage investment approach in an interview published by Sales Hacker. The firm has raised nine funds totaling nearly $1.5B in AUM.

Lerer previously built Thrillist, which later merged into Group Nine, before transitioning to venture capital and making early investments in Warby Parker and Casper.

Investment Committee Process

Lerer Hippeau makes decisions based on conviction rather than consensus. One partner must strongly advocate for a deal while others attempt to argue against it.

The firm aims to create conditions where junior team members can safely disagree with the managing partner. Lerer stated that his regrets often stem from delegating high-conviction deals to junior staff for diligence.

According to Sales Hacker, he prefers to conduct customer calls and character references himself on such opportunities.

Founder Selection Criteria

Lerer Hippeau targets founders whose best-case outcomes can deliver multi-fund returns rather than stable enterprise businesses. The firm explicitly avoids funding sensible, durable companies because those allocations reduce capital available for power-law bets.

Lerer described a preference for backing "crazy" founders over good companies. He also noted the absence of a single formula when evaluating AI-native founders against experienced domain operators.

Competitive Deal Dynamics and Past Outcomes

Lerer addressed changes in winning deals within a more competitive market. He cited the decision to pass on Peloton as an example of a process shortfall.

Lerer stated his goal is to become the worst investor at the firm by building a team capable of outperforming him over time.

According to Sales Hacker, the conversation also covered the shift from media operator experience to venture capital and the mechanics of running an investment committee across multiple funds.