Benchmark’s Victor Lazarte on what changes (and what doesn’t) when transitioning from operator to VC

Victor Lazarte’s playing a new game.

This time last year, he was the CEO of Wildlife Studios, the Brazil-based mobile games giant he cofounded with his brother in 2011. Now, he’s navigating the transition from operator to VC as Benchmark’s newest partner—and Lazarte has just made his first investment, driving Benchmark's role as the lead investor in AI video creation startup HeyGen.

It seems like HeyGen was particularly coveted as it raised its Series A, which shook out to $60 million at a $500 million post-money valuation. The company’s numbers are impressive: In about a year, HeyGen is profitable and grew from $1 million to over $35 million in ARR, the company has disclosed. Thrive Capital, Bond Capital, Conviction, Dylan Field, Elad Gil, and SV Angel, among others, all participated in the round.

But it was rookie Lazarte who led for Benchmark, and he’s joining HeyGen's board.

"With AI, there's a lot of promise, and there are very cool demos, but there are very few companies that are actually creating value," Lazarte tells me, in his first interview after the deal. "So, I think with HeyGen, you have a thesis that’s incredible. You have a product that people actually use and it feels like magic."

Before Lazarte locked in on HeyGen as his debut deal, he saw “hundreds of companies” in his first 11 months at Benchmark. And yes, for all the discourse about how a background as an operator sets you up for success as a VC, the two roles are different.

“One mistake that I’ve made, that I think is common for operators-turned-investors, is that when someone pitches a company, you project a lot into it,” said Lazarte. “You can do this or that thing, and get very excited about the company you’d build in that person’s place—and that’s a huge mistake…This one time I brought a company in and all the partners asked why I was excited about such a small market. And I was like, yeah, but after they do this, there’s an opportunity to go much further…People reminded me then—the entrepreneur hadn’t pitched us on any of this, that [I’m thinking about] the company I would do.”

Deal sourcing and flow is also something Lazarte's been thinking a lot about over the last almost-year. One might assume that being at Benchmark smooths all that out, but it’s complicated. On one hand, you get a lot of inbound and could, theoretically, fill your calendar to your heart’s content. On the other, how do you know you’re actually seeing the right things? What does it mean to optimize time as a VC?

"As an operator, you start your week and you say, 'Okay, how many things can I get done this week?' Then, it’s 'What are the outcomes from that week?'" he said. "And in venture, it’s not about how many things you do. It’s about doing very few things that matter."

I ask Lazarte if he’ll do an experiment with me, use this story as a time capsule: What questions does he have today that he thinks he’ll have answers to in five years? The first question he’s obsessing over: What does an optimal sourcing strategy actually look like in venture? And the second question is one that he's far from alone on:

"Right now, investing in AI can be disorienting, because everyone knows that we're about to go through this incredible transformation," he said. "But in that transformation, where's the value going to accrue?"

I tell him I’ll come back for answers someday. In the meantime, for Lazarte, one question remains: He just made his first investment—he’s on the board, figuratively and literally. What happens next?

“The fun part starts now,” said Lazarte. “I get to spend a ton of time going deeper in the business with [HeyGen cofounders] Joshua and Wayne, helping this platform become what it can be. That’s the part that’s closer to what I did before.”

Which gets at the secret of excelling at any new game: There really is no such thing as a new game, because even when we start over, the games we’ve played before still matter. They’ve made us who we are.

I’m reading…Chris Thompson has been building SoberSidekick, an app helping those struggling with addiction, since 2019. But three years ago, he turned away more than a dozen VCs. Here’s why, and what happened next, by my colleague Jessica Mathews.

ICYMI…OpenAI made its first acquisition last week, of database analytics startup Rockset.

See you tomorrow,

Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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This story was originally featured on Fortune.com