Blog articles

Instant Covid Tests

A VC - 18 hours 28 min ago

We are now approaching five months into the Covid pandemic in the US. The world is more like six or seven months in. And while we wait for vaccines and/or therapeutics to end it, we are left with social distancing, mask wearing, testing, and tracing. These tools can and do work well if used rigorously and ubiquitously.

As we prepare to return to NYC in the fall, I am curious about the state of small and portable diagnostic technologies that can deliver an accurate and “real time” result cost effectively. I am thinking of something like a pregnancy test.

There are many things that would benefit from such tests. Schools could be more agressive about re-opening if everyone (teachers and students and staff) could be tested every morning on the way in the door. Offices could re-open too. So could stores and other local businesses.

And it would be easier to go see friends and family if you arrive at their front door with a test in hand and get a negative result before walking in the door.

I know that there are a number of companies working on such tests. What I don’t know is the status of these efforts, how soon they can come to market, and what they will cost. The less expensive the better obviously.

If you know anything about these technologies, please hit the “Discuss On Twitter” button below and share it with all of us. If you want to see what has been shared, hit the “View Discussions” button. If you are reading via email, go here to see these buttons and hit them.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

The Dog Days Of Summer

A VC - August 3, 2020 - 4:50am

We are officially in the dog days of summer when vacations and the heat and humidity cause things to slow down.

It used to be true that companies would put financing efforts on hold in late July and August and return to “the market” after labor day.

In recent years, that summer slowdown has not happened as much and we have advised our portfolio companies to keep raising during the summer doldrums.

This year will be interesting as many founders and investors have been working remotely for five months now. Will that change anything this summer?

It is possible that everyone needs a break and things will slow down this month. But I kind of doubt it. This has been a crazy and unpredictable year but the one thing that has been true throughout the year is that the capital markets are working overtime and I suspect that will be true during the dog days of summer too.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Walking Away: From the “New (Old) World Order,” into the Old (New) World Order. Part II

Beyond Money - August 1, 2020 - 6:30pm

ConfusedDirections

Discord and confusion, conflicting stories, rampant disinformation, faction against faction,  widespread anger and fear, people fighting among themselves, economic dislocation, personal interactions disrupted and people separated from friends and family, cessation of favorite sports and pastimes, and widespread abandonment of familiar ways of doing things. That is the state of our world today.

How have we come to this sorry pass and to what is it leading? Is this an act of God, is it the natural course of societal evolution, or is it something that has been intentionally contrived, and if so, by whom and to what purpose?

Read the full article here

Categories: Blog articles

Funding Friday: The Last Fair Deal

A VC - July 31, 2020 - 4:31am

Playing cards and listening to the blues is the perfect combo and this deck of cards celebrates that.

I backed this project immediately when I saw it this morning.

It has five days to go and is 70% of the way to its goal. If you love cards and the blues, check it out.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Repost: Open Up Vs Break Up

A VC - July 30, 2020 - 5:37am

I was in a board meeting for most of yesterday so I did not watch the theatrics on Capitol Hill. William told me that there were many calls for breaking up the big tech companies. So I thought I would repost this which I wrote about a year ago.

There have been many calls to break up the large Internet monopolies; Amazon, Google, Facebook, Apple, etc.

Breaking up a large monopoly feels like a very 19th/20th century move to me.

I would prefer that politicians and policy makers think about opening up as the better intervention.

A good way to explain this is to go back to the architecture that Twitter used in its early days when there were many third-party Twitter clients. Imagine if Facebook, Instagram, Twitter, LinkedIn, etc were protocols, not applications, and there were many high-quality clients to participate in these networks.

Then the clients could innovate on things like content filtering, promotion of high quality content, business model, etc

If we are going to “break up” these large social media platforms, I would urge elected officials and regulators to think about pushing them to move from platforms to protocols instead of just ripping them apart.

We could do the same thing with search. Our portfolio company DuckDuckGo has built a nice search business by building a different user interface on top of one of the two leading search indexes. If we made it easier and reliable for others to innovate on top of the core search engine, then there might be many more options in search.

In mobile, a good first step is to open up the app stores and allow the browsers to have the same access to the operating system as native mobile apps.

In commerce, if I could checkout as easily everywhere as easily as I can on Amazon, there would be more competition for my shopping dollars.

I think you get the idea. It is very true that the big Internet services have built centralized monopolies and have consolidated their market positions. We do need more competition in these core services. And the best way to do that is to force them to open up their services, not break them up.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Is This One For Real?

A VC - July 29, 2020 - 5:31am

Crypto has been on a tear in the last week.

Bitcoin is up 18% in the last seven days:

Ethereum is up over 30% in the last week:

But this isn’t the first time we’ve had a bullish run in crypto since the bear market started in early 2018.

If you look at the total market cap of all crypto tokens you can see that this bear market has had several moves up followed by downward price action:

So why will this time be any different? I certainly don’t have a crystal ball, but there are some underlying factors in this run-up that make me think it might be different this time:

1/ There is real fundamental activity in the decentralized finance sector where lending, borrowing, staking, swapping, and yield optimization are all growing significantly in recent months. This chart of the activity on the Uniswap liquidity network is indicative of that:

Categories: Blog articles

Entrepreneurship And The Climate Crisis

A VC - July 28, 2020 - 5:29am

Vinod Khosla penned a fantastic blog post this week outlining how a few entrepreneurs have made a material impact on clean energy and reducing our collective carbon footprint in the last decade and how a few more can move the needle even further in the next one.

Vinod starts off with this statement:

12–15 entrepreneurs, driven by entrepreneurial energy and passion for a vision, and a little bit of luck, could change the climate crisis into societal transformation

This is music to our ears as USV has started to back climate-focused entrepreneurs. I hope that we can back one or two of these 12-15 innovators in the coming years. That would be great for society and great for USV too.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Walking Away: From the “New (Old) World Order,” into the Old (New) World Order. Part I

Beyond Money - July 27, 2020 - 1:32pm

ObeySleep1

Global pandemic, social distancing, widespread shut-downs, testing and “tracing,” economic crisis, and more recently, massive protests and social unrest, not just in the US, but around the world — What does it all mean? Like virtually everyone else in the world, my attention lately has been focused on that question.

I don’t feel terribly anxious about Covid-19, even though for me personally it poses a significant existential threat. Although I’m fortunate to have no chronic illnesses, I am well advanced in years, and according to some recent reports, my gender, blood type, and ethnic heritage may put me further at risk.

I am more concerned about the social, political and economic impacts of the situation and governments’ reactions to it which may turn out to be more disruptive than the pandemic itself. At the same time I am hopeful, even optimistic, that this crisis brings with it great opportunities for positive changes that are long overdue.

Read the full article here

Categories: Blog articles

The Startup Community Way

A VC - July 27, 2020 - 4:21am

My friend Brad Feld has updated his excellent book on startup ecosystems called Startup Communities. The updated and expanded book is called The Startup Community Way and it is available for pre-order on Amazon. The book comes out tomorrow so you won’t have to wait long for it.

The timing of this book is excellent. The pandemic has shown that you don’t have to live and work in any particular place to be productive and innovative.

This suggests to me that we will see tech entrepreneurship and innovation move even more broadly around the US and around the world this decade and The Startup Community Way can be a playbook for how to make that happen.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Reclaiming the Credit Commons

Beyond Money - July 25, 2020 - 5:59pm

The concept of the “credit commons” is something I articulated at length in my 2009 book The End of Money and the Future of Civilization, along with a thorough description of how it can be reclaimed from monopoly control. In November of 2010 I was invited to participate in the International Commons Conference: Constructing a Commons Based Policy Platform Economy, sponsored by the Heinrich Böll Foundation, in Berlin, Germany.

In my presentation there I pointed out that credit is a crucial aspect of the commons that has been generally overlooked, and that reclaiming it is crucial to any attempt to promote social justice, economic equity, democratic government and a world that works for everyone.

This video is a composite of the video record that was made and the slides that I showed at that time. It can also be viewed at Credit Commons on YouTube.

Categories: Blog articles

Funding Friday: The Steamchasers

A VC - July 24, 2020 - 4:24am

I am a big believer in the saying “you can’t be what you can’t see.” And I have spent a lot of time and energy finding ways for young people to see careers in science, technology, and innovation so that they can put themselves on a course to have one themselves.

I came across a series of books for kids called The Steamchasers on Kickstarter today. These are books about a group of kids, The Steamchasers, who take a scavenger hunt through town finding the contributions Black Americans have had to our everyday lives in the areas of Science, Technology, Engineering, Art, and Math. The first and second books in the series are available on Amazon.

The third edition is being funded on Kickstarter right now and I backed it this morning.

For those of you reading on the web, here is the video. If you are reading on email, you can watch the video here.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Headgum and Gumball

A VC - July 23, 2020 - 6:03am

Podcasts have emerged as a major new category in media/entertainment/news/education etc. We have seen huge deals for big podcast hosts like Bill Simmons and Joe Rogan, both of whom did transactions with Spotify for nine-figure amounts. But as Spotify (and surely others to follow) lock-up top podcast content to strengthen their subscription offerings, we stand to lose something awesome about podcasts which is the ability to listen to them for free on any platform we choose.

But the counter weight to this trend is the growing size of the “live reads” ad market. This is when a podcast host reads out an advertisement on the show. This has been a staple of talk radio for many years. I remember Howard Stern doing live reads for LoJack back when Howard was on CBS Radio. Live reads are powerful and a form of influencer marketing. If you love Howard and he waxes eloquently about LoJack, you love LoJack. Or so it seems.

The live reads ad market for podcasts was in excess of $700mm in 2019 and seems headed to a multi billion dollar ad market in the coming years. So there is certainly a lot of money out there for podcast hosts who want to stay free and independent, or are emerging and building an audience.

And that is where Gumball comes in. Gumball is a marketplace where advertisers post live read ads and podcasters pick them up and read them on their shows. Ad-buying opportunities within podcasts have historically been manual and limited, not unlike the process of purchasing web ads pre-2000. As podcasts continue to gain market share, Gumball’s self-serve ad marketplace has the opportunity to be as transformative to the podcast industry as Google Adwords was for web ads. 

Gumball is a subsidiary of the Headgum podcast network. Headgum is a network of owned and operated comedy podcasts as well as third party podcasts that join the Headgum network for distribution and monetization (via Gumball).

USV has been looking for an opportunity to invest in podcasting that fits with our thesis and we found it with Headgum and Gumball. We like the way that Headgum’s owned and operated content, its Headgum network content, and its monetization platform Gumball all fit together and enhance each other. We made an investment in Headgum recently and blogged about it on the USV blog this morning.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Open Source Exposure Alerting Apps

A VC - July 21, 2020 - 6:35am

The Linux Foundation announced its Linux Foundation Public Health initiative yesterday.

They are starting with two open-source exposure alerting apps called Covid Shield and Covid Green. These are two apps that use the Google Apple Exposure Notification (GAEN) infrastructure. The codebase for both apps has been open-sourced.

The Linux Foundation had this to say:

“To catalyze this open source development, Linux Foundation Public Health is building a global community of leading technology and consulting companies, public health authorities, epidemiologists and other public health specialists, privacy and security experts, and individual developers,” said Dan Kohn, LFPH general manager. “While we’re excited to launch with two very important open source projects, we think our convening function to enable collaboration to battle this pandemic may be our biggest impact.”

https://www.prnewswire.com/news-releases/tech-leaders-and-health-authorities-from-around-the-globe-collaborate-to-combat-covid-19-301096039.html

Countries, states, public health organizations, etc can build on these open source code bases to create exposure alerting and other apps that can help with the Covid pandemic and potentially other public health issues going forward.

I quite like how this is playing out. Google and Apple have built the base level infrastructure, the open source community is coming together to build the application level code base, and governments and public health organizations can take all of that and put applications into the market.

I am hoping we will see applications built this way coming to market in the near future.


USV TEAM POSTS:

Nick Grossman — Jul 31, 2020
Hardware-based Identity

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Categories: Blog articles

Landline Phones

A VC - July 20, 2020 - 1:46pm

I know so many people who don’t have landline phones. They simply have their cell phone and use it for everything.

But I also know a lot of people who are working from home (or a rented place, a vacation home, etc) right now and struggling with their cell phone reception and other issues.

I grew up in a time before cell phones and have always had a landline phone. I still use a landline phone. But I have used the power of voice over IP (VOIP) and the cloud to make landline phones work better for me and I thought I’d share that “hack” with all of you.

I’ve ported all of the landline numbers I’ve had over the years to the cloud and host them in a cloud-based PBX called Onsip.

I then use a VOIP phone (my favorite right now is a DECT-based VOIP phone from Yealink) to connect to one or more of those numbers in the cloud.

That way, my landline phone number can follow me from my office, to my home, to my Airbnb, to my wherever.

This also allows us to have different numbers; a home number, a work number, multiple work numbers, and even a number that only a few people have (which I like to call “the batphone”).

If you would like to combine the reliablility of a landline phone with the mobility of a cell phone, try a cloud based PBX and VOIP phones. It’s a great combination and works great for us.


USV TEAM POSTS:

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Nick Grossman — Jul 27, 2020
The Beauty of Focus

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles

New Podcast Episode

Beyond Money - July 18, 2020 - 5:35pm

Episode 9 A conversation with Jose Francisco Garcia Mazcorro

Jose Francisco Garcia Mazcorro (Pepe) (Born in July 1982), is a scientist and educator who from 2000 to 2005 studied Veterinary Medicine and, in 2011, received a PhD degree from Texas A&M University.

Upon his return to Mexico in 2012, Pepe and his wife, Alicia, who also holds a PhD from the same university, started a program they called “Free Science Classes.” Pepe currently spends most of his academic life working on various research projects related to the human and animal microbiome. He also has an interest in Social Philosophy and published a book on that subject in 2007.

In this podcast interview, Pepe describes his work of taking science directly to children, provides some insights into Mexico’s current political situation and the implications of the election in 2018 of President Andres Manuel Lopez Obrador (AMLO), and discusses the status of the COVID “pandemia” in Mexico, its consequences, and possible remedies to avoid an even more complicated scenario in the years ahead. You can learn more about Pepe and his work at his personal website athttps://sites.google.com/site/josefgarciamazcorro/home. Pepe also recommends this video about social distancing.

Categories: Blog articles

Funding Friday: Skin Deep

A VC - July 17, 2020 - 6:29am

This animated short film project showed up in my Kickstarter feed this week and I backed it right away. It’s about kids learning to love who they are. It is a message that we all need to hear right now.


USV TEAM POSTS:

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Nick Grossman — Jul 27, 2020
The Beauty of Focus

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles

When Do I Create A Board?

A VC - July 16, 2020 - 6:24am

I’ve been asked this question a bunch in the last few weeks in response to my post about more diversity on Boards.

My answer to this question is simple.

A Company should have a Board the day it is formed. The Board should contain one Founder (or possibly two) and at least two independent Directors.

I know that many founders want to control their Boards for as long as possible. I would prefer to see a Founder give up control right away but place control in the hands of independent Directors they nominate. That way they can be comfortable that the independent Directors will have both their interests and the Company’s interests at heart.

This will also make it a lot less likely that the Investors will eventually control the Board as the Board will have institutionalized the notion of independent Directors early on and ideally they will remain the majority of the Board forever.

Finally, it’s a great idea to pick diverse candidates for those independent seats day one. Diversity means “not like us” so it could mean gender diversity, racial diversity, industry diversity, experience diversity, or ideally more than one of those things.


USV TEAM POSTS:

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Nick Grossman — Jul 27, 2020
The Beauty of Focus

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles

Not So Hyperactive

A VC - July 15, 2020 - 3:53am

I wrote a blog post last week in which I said:

The second quarter of 2020 is now behind us and we will see the data on it soon. I suspect what we will see is a very active venture capital market, quite the opposite of what was initially expected.

Well the data is out and its not quite as active as I had thought.

Venture deal activity slowed in the second quarter, with $34.3 billion invested across 2,197 deals, a 23% decline in deal count compared to the second quarter of 2019 but only down slightly from 2,298 venture capital deals in the first quarter of this year.

Notable among the figures was a slump in seed deals to 315 in the quarter, way down from an average of 650 deals per quarter over the last year. Angel rounds were roughly steady by comparison in the quarter. The dropping investment in seed rounds is attributed to investors re-evaluating their portfolios and shoring up balance sheets for the quarters to come.

Standing out in the data is a trend for investors to double down on portfolio companies, with follow-on financing activity heavily outweighing first-time financing in the quarter. Likewise, there has not been a drop in late-stage activity as deal count tracked at a higher pace than 2019.

In the quarter there were 57 late-stage megadeals, those of more than $100 million. That brought total megadeals to more than 100 this year, on track to surpass the 175 megadeals closed in 2019. The report notes that some of those deals can be attributed to startups experiencing newfound growth amid the pandemic, while others were forced to raise additional funds to weather the economic turmoil.

https://siliconangle.com/2020/07/14/venture-capital-drops-due-covid-19-second-quarter-started-recover/

So Q2 was down from Q2 2019 but almost flat with Q1 2020. The most interesting thing is that Q2 had a very slow start and a very strong finish.

Different segments of the venture capital market fared differently to others with the biggest overall slump occurring in April amid lockdowns across the U.S. The report notes that through April and into early May, many venture capital firms exercised caution, triaging and focusing primarily on stabilizing their own portfolio companies. But investment started to pick up again by mid-May.

https://siliconangle.com/2020/07/14/venture-capital-drops-due-covid-19-second-quarter-started-recover/

That squares with what I have seen, although USV was quite busy throughout the entire quarter.

The strong finish to Q2 bodes well for the remainder of the year and I think for the most part the venture capital sector is very much open for business in the midst of this pandemic.


USV TEAM POSTS:

Andy Weissman — Jul 28, 2020
Meet Cute (or, one way to create a new media business)

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Nick Grossman — Jul 27, 2020
The Beauty of Focus

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles

Reading On Paper

A VC - July 14, 2020 - 8:14am

I’m staring at a pile of paper on my desk that is my stack of things I found on the Internet that I want to read.

It’s a bit ironic to write this on a blog, but if I come across something on my computer or phone that is longer than a page or two, I print it out and read it on paper.

I have found that when I read on a computer screen or phone, I tend to skim. That’s fine for a short email or a short blog post (as this will be).

But it is not great for an eight page blog post, a white paper on a new crypto project, or a memo from one of my colleagues or portfolio companies.

When I read on paper, I often will use a pen to underline or mark-up the document. I find that leads to better comprehension and retention of the concepts.

I’ve noticed that our children, all of whom are in the mid to late 20s, also read books in paper form and mark them up when reading them. So while reading on paper may be a generational thing, I believe it is also a valuable technique for all ages and all generations.


USV TEAM POSTS:

Albert Wenger — Jul 27, 2020
The Threat of a Trump Dictatorship

Nick Grossman — Jul 27, 2020
The Beauty of Focus

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles

Haggling

A VC - July 13, 2020 - 5:05am

Growing up, I thought the price asked was the price. The only decision was whether or not you wanted to pay it.

As I moved into adulthood, started hanging out with the Gotham Gal and a bunch of friends, and entered the world of business, I learned that the price was what you agreed to pay for something, not what was asked.

When I started out in VC in the mid 80s, the investors usually started the price negotiation. The founder would come in and pitch, and if the investors liked what they heard, an offer would be made.

It is very different now. Founders have an asking price when they walk in the door. And often VCs treat that asking price like I treated prices as a kid. The only decision is whether or not you want to pay it.

The reason for this is that the VC market is highly liquid and there are many buyers out there. Investors understand that even if they won’t pay the asking price, someone will. And so they treat it like it’s “take it or leave it.”

But I am not a fan of that approach. I prefer to have a discussion about the asking price. If a founder says they are thinking of raising $10mm for 20% of the Company, I like to reply with something like “We were thinking of $6mm for 20%”, thereby setting up a discussion of the price.

It doesn’t always work. Many founders reply with something like “I’ve got term sheets at that price already” which basically means “take it or leave it.”

But even then, I have found there is a way to have a price negotiation if both sides are looking to do business with each other.

The key is doing it respectfully and honestly. I feel like the sooner you have the price conversation the better. The worst thing is dragging a founder along in a process with them thinking you are at their price when you are not.

Negotiation is an important part of any business transaction. It reveals something about both parties and helps them understand each other and decide if they want to work together. I would encourage everyone to seek a negotiation and engage in it enthusiastically. Doing a deal without a negotiation feels like a missed opportunity to me.


USV TEAM POSTS:

Albert Wenger — Jul 24, 2020
A Catalog of Excuses

Hanel Baveja — Jul 23, 2020
Headgum

Categories: Blog articles
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