Jay Levy is the co-founder and partner at Zelkova Ventures, an early-stage venture capital firm with over 17 years of experience backing transformative SaaS companies like Help Scout, Klout, and Crimson Hexagon. From designing websites in high school to scaling startups during the dot-com boom, Jay has lived the full founder-to-investor journey. With a disciplined, people-first approach to investing, he offers sharp insights on scaling efficiently, founder self-awareness, and how AI is reshaping the venture landscape.

In this episode, he discusses how to identify the right founders, lessons from startup failures, valuation discipline, and why the VC industry may need to reinvent itself in the AI era.

In Today’s Episode We Discuss:

00:01 – Welcome & Jay Levy Introduction

00:44 – Early days: building websites in high school

02:02 – Recurring revenue lessons from hosting clients

02:30 – First big project: city youth website gains national attention

03:55 – Joining Uconnections during the dot-com boom

04:48 – Startup collapse and lessons from scaling too fast

06:14 – Transition to Morgan Stanley and corporate reality check

07:15 – Leaving Wall Street for entrepreneurship

08:14 – Early days of New York’s tech scene

09:08 – Founding Zelkova Ventures and initial clean tech focus

10:46 – Lessons from Uconnections and the importance of pacing growth

12:43 – Finding a sustainable revenue model early

14:23 – How Zelkova’s investment thesis evolved

16:45 – The importance of valuation discipline

18:43 – Easy “no” deals and founder self-awareness

20:24 – Assessing the “ego-to-ability” ratio

21:23 – The three types of investors founders meet

23:37 – Avoiding investor-founder misalignment

24:47 – Zelkova’s check size and barbell investment approach

26:29 – Reserve strategy and follow-on investments

27:24 – Board observer seats vs. board member roles

29:15 – Managing multiple board observer roles

30:54 – How AI is reshaping product development costs

33:12 – From MVP to “Pretty Good Viable Product” with AI

34:41 – Building companies more efficiently with AI tools

36:10 – Could AI reduce the need for early-stage VC?

38:36 – Platforms, scalability, and AI’s “last mile” problem

40:29 – The shift toward AI-powered business operations

41:42 – Early-stage investment focus areas today

46:26 – In-person vs. remote-first startups

48:13 – Patterns of the best founders Jay has backed

50:58 – Where promising founders fall short

52:38 – The early-stage metrics that actually matter

54:58 – Why CAC and early-stage NPS are overrated

56:11 – Underappreciated metrics: qualitative customer feedback

57:57 – A company Jay passed on but still thinks about

59:11 – When valuation discipline pays off (and when it doesn’t)

01:01:13 – Being both a GP and LP in the venture world

01:03:00 – Later-stage investments for faster liquidity

01:05:41 – Thoughts on SAFEs, convertible notes, and doing it right

01:09:00 – Closing thoughts and where to connect with Jay Levy

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