Listen on: Youtube, Apple Podcasts, Spotify
Podcast10x sponsors this episode
Podcast10x is my podcasting agency that helps VCs start & run a podcast end-to-end. We only require a 30-minute/week time commitment from our clients while we handle everything from production to publishing.
About the guest:
Brad Harrison is a West Point graduate and former Airborne Ranger who leveraged his military discipline to found Scout Ventures. Scout is a seed-stage firm dedicated to "dual-use" frontier technologies spanning AI, space, quantum, and energy that serve both commercial markets and national defense.
Key insights from the episode:
1. Deep Tech Needs Different Fund Math — Pretending Otherwise Is the Risk
One of the biggest mismatches in venture today is trying to force deep tech outcomes into a 10-year VC model.
The reality:
Breakthrough technologies often require 12–18 years
Scientific validation, CapEx intensity, and regulatory cycles don’t compress on demand
Liquidity doesn’t magically appear just because the fund clock is ticking
The best deep-tech managers don’t deny this — they design around it.
2. DPI Is Engineered, Not Hoped For
A critical insight from the episode:
You can’t just wait for unicorn exits in deep tech.
Instead, liquidity has to be actively engineered.
That means:
Identifying companies that are good businesses, even if they’re not generational outcomes
Creating liquidity in years 5–7 by selling or exiting those companies
Returning capital early so LPs are “in the money” before long extensions kick in
Once DPI is returned, time stops being the enemy — for both LPs and managers.
3. Fundraising in Deep Tech Is a Trust Game
Raising capital as a deep-tech manager isn’t about storytelling alone.
What actually compounds:
Consistent, on-time LP reporting
Transparency when things go wrong
Clear articulation of how and when liquidity might be created
LPs don’t expect certainty — they expect thoughtfulness and honesty.
Trust is built long before returns show up.
4. Non-Dilutive Capital Is a Competitive Advantage
One underappreciated lever in deep tech is non-dilutive government funding.
When used correctly, it:
Reduces dilution risk
Extends technical runways
Makes otherwise impossible companies investable
For frontier technologies, this isn’t a nice-to-have — it’s often the difference between survival and failure.
5. Check Size Determines Liquidity Outcomes More Than Most Managers Admit
One subtle but powerful point from the episode: the size of the first check changes everything.
Check size doesn’t just affect ownership, it shapes:
How involved a fund needs to be operationally
Whether the firm can influence hiring, strategy, and timing
The set of liquidity options available later in the fund’s life
In deep tech, smaller, early, conviction-led checks often create more flexibility, not less — especially when paired with board involvement and milestone-based capital deployment.
Funds that ignore this end up overcapitalizing too early, locking themselves into outcomes that require massive exits to work.
Funds that understand it can manufacture DPI without waiting for perfection.
🎧 Listen to the full episode to hear how to build a durable business that survives the bubble.
Recent uploads on VC10X
Why OpenAI finally gave in to ads? (4 mins)
Apple X Google AI Deal (4 min)
Shift to Physical AI at CES 2026 (3 min)
Gamification of Consumer Apps (43 min)
Is the silver rally over? (4 min)
LP Roundtable 2025/26 (58 min)