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Musings of a VC in NYC
Updated: 4 hours 8 min ago

Southeast Asia

16 hours 55 min ago

We spent the last nine days in Southeast Asia, in Vietnam, Cambodia, and Laos. If you want the play by play version of our trip, head on over to the Gotham Gal’s blog where she does that and has has done for every trip we’ve taken over the last fifteen years.

As an aside, if you ever want travel tips to many destinations around the world just Google for the city and add gothamgal.com to the end of the search query and there’s a good chance you will find a host of blog posts that she has written about that location.

But I digress.

Throughout our trip in Southeast Asia over the last nine days, I was struck by the palpable feeling of economic growth and entrepreneurship. It felt like a region that is pulling itself out out of poverty by it’s bootstraps.

There is a long way to go for sure. Annual per capita GDP in Vietnam is roughly $7000US, that number is roughly $6000US in Laos, and roughly $4000US in Cambodia.

But there is a vitality everywhere you go. People are on the go. Construction projects abound. Commerce is everywhere. People have phones and motor scooters.

Most of all you see children and young adults. This is a region that lost much of my generation to war and genocide. But they are regenerating their families and societies. In Vietnam, 50% of the population is under 30. In Cambodia, 70% are under 22.

The people are nice. They welcome the tourists and understand the economic support it brings to their cities and country.

So I’m very optimistic about these countries. They are on the move. It was exciting to see that.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Crypto Asset Allocation

October 14, 2017 - 5:54pm

Coindesk did me a disservice with this blog post:

USV’s Fred Wilson Predicts ‘Big’ Cryptocurrency Crash https://t.co/P8085HlhW1 pic.twitter.com/8rVaudYnlA

— CoinDesk (@coindesk) September 26, 2017

It made it seem like I was predicting an imminent crash which I was not.

But just as bad, it has led to a lot of tweets like this one suggesting that I also said that people should have 10-20% of their net worth in crypto:

Interesting viewpoint: @fredwilson believes #cryptocurrencies could represent 10-20% of the allocation strategy for an informed investor https://t.co/0tphYEQ5sG

— Jean-Michel Pailhon (@jmpailhon) October 14, 2017

What I did say is that “true believers” in crypto might want to have 10-20% of their net worth in crypto assets. For many of these true believers that would be down from 80-100%.

So, what do I think is a reasonable asset allocation to crypto for the average investor?

Well to start, as I mentioned in that blog post, The Gotham Gal and I have about 5% of our net worth in crypto assets, across a number of vehicles; direct holdings, USV funds, token funds, etc. We have a fairly diversified crypto portfolio, likely much more diversified than most folks could do on their own.

I think that’s likely at the high end of what the average person should have, but I also think its not a ridiculous number for the average person to have.

Many endowments, pension funds, etc allocate 3-5% of their portfolio to venture capital. They know its a risky asset but it has the potential for outsized returns. The largest allocation I have seen to venture capital from a big endowment or pension fund is 10%. So that gives you a sense of what sophisticated investors do with risky asset classes.

If you had to pin me down on a number, here is where I would end up:

  • young, aggressive risk taker – 10% of net worth in crypto
  • sophisticated investor seeking a high performing portfolio – 5% of net worth in crypto
  • average investor, slightly conservative, but with some appetite for risk – 3% of net worth in crypto
  • retiree seeking to preserve portfolio value and generate income – 0% of net worth in crypto

Hopefully this will set the record straight. It makes me very nervous when I see folks tweeting out “advice” that I did not give.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Audio Of The Week: Luis von Ahn, Founder and CEO of Duolingo

October 13, 2017 - 8:12pm

Luis von Ahn is a terrific entrepreneur and computer scientist. He is the founder of our portfolio company Duolingo. In this podcast he talks about all sorts of interesting topics.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Funding Friday: Mobile App Controlled Paper Airplane

October 13, 2017 - 2:45am

I just backed this project. I looks like so much fun. I used to love paper airplanes when I was a kid.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Managing Time Zones

October 12, 2017 - 5:27am

I find managing time zones really hard when the differences are large.

Eleven or twelve hours is particularly difficult for me. I have missed a couple of scheduled calls this week because I thought they were happing at entirely different times of day.

I am curious what tips and techniques all of you use to manage this sort of thing? I’m really struggling with it.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

AP Computer Science Exams In NYC

October 10, 2017 - 11:44pm

The NYC Department Of Education announced yesterday that almost 4,000 high school students took an AP Computer Science exam in the school year that ended in June. This news was part of a larger announcement that total NYC students taking AP exams increased 7.5% last year to almost 50,000.

The NYC public school system is the largest school system in the country with about 1.1mm students, about one third of which are in high school. So moving the needle in a system that big is hard but when you do it, you can really have an impact.

The AP CS news was particularly gratifying to me as I have been working for most of this decade to get computer science broadly offered in the NYC public school system. I see this work as an important investment in the children of NYC and in the NYC economy and business community too.

When I started this work, about 600-700 students from the NYC public school system would take the AP CS exam each year. And most of them were from the top schools in the system (Stuyvesant, Bronx Science, Brooklyn Tech). That number slowly grew, to 926 students in 2015, and to 1,137 in 2016.

So what happened this year to cause an almost 4x expansion in one year?

Well first and foremost, the The College Board added a second AP CS exam, called AP Principles of Computer Science. That opened up the AP CS population to students who are not deeply skilled/schooled in Java (which is a big part of the AP CS exam).

But equally important, the CS4All program in NYC, which is bringing CS to every school and supporting 40 middle schools and 40 high schools to offer full multi year programs in CS, is starting to kick in. Over 90,000 NYC public school students studied CS in their school last year. That is starting to have an impact.

So where do we go from here? Well I expect we will see over 10,000 NYC students take an AP CS exam within another few years and that number will get even larger before the ten year CS4All program is fully deployed in 2025.

We are also seeing the AP CS test taking population starting to more closely mirror the demographics of the NYC public school system. More girls are taking it. More black and hispanic students are taking it.

AP CS exams put students on a path to attend college and study CS. They will do that in NYC where the local colleges, including CUNY, are upping their CS game significantly. And they will do that at leading engineering schools around the country.

And that, in the end, leads to a more diverse set of skilled talent for our economy, both locally in NYC and around the US, in the coming years. And god knows we need that. Badly.

CS4All is a public private partnership between the city government which is putting up half the funds for it and private donors who are putting up the other half in a $40mm capital campaign that I chair. If you know of a person, a foundation, or a company that would like to support this work, please have them contact me or my colleague Jennifer Klopp who is the Director of the CS4all Capital Campaign. We will gladly come talk to them about our work and how they can support it.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Swinging For The Fences

October 10, 2017 - 5:43am

A number of our portfolio companies use scoring systems to prioritize projects on their roadmaps. I like this one called RICE (reach, impact, confidence, effort). There are similar versions of this out there. The important thing about these systems is that you need to include probability of success in your analysis. Just looking at effort and impact isn’t enough.

But one thing I’ve seen about these scoring systems is that they can lead your team to do lots of low and medium impact things that have a very high probability of working.

I generally would like to see our portfolio companies taking at least one or two big swings a year. These are high impact, often high effort, and often low confidence. They don’t score that well as a result.

But if you aren’t going for it with at least some of your resources, you can get mired in a rut of small wins and that can be a problem for your growth trajectory, morale, and overall business mojo.

So while I like it when our portfolio companies use scoring systems, I generally suggest they add a requirement to take at least one big swing a year. Over the course of several years, they will get at least one of these right and it can make a huge impact on the business.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

The Conversational Pitch

October 9, 2017 - 4:43am

Lately I have noticed an increase in entrepreneurs coming into USV (or videoing into USV) and talking to us about their business without the use of a deck.

I don’t know what to make of that to be honest.

But I like it for a bunch of reasons.

It allows for more conversation and less presentation.

It also shows that a founder or a team can talk about their business intelligently without the “crutch” of a deck.

I am NOT recommending that anyone take this approach. I like to see our portfolio companies use decks when they raise rounds and we help them improve these decks as part of helping with the fundraise process.

But as a receiver of pitches, I do like the unscripted conversation.

It tells me a lot about the team.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Locked and Unlocked Phones

October 7, 2017 - 11:20pm

We landed in Vietnam yesterday and immediately got a text from TMobile that they don’t offer data roaming in Vietnam. They do offer basic voice and SMS.

So we bought two 10GB data only SIM cards in the airport for 300,000 dong (about $13 US) each.

I took out my TMobile SIM of my Google Pixel and inserted the 10GB SIM and was good to go. I can use data for voice and messaging so the data only thing is no big deal to me.

I did the same on the Gotham Gal’s iPhone and after going through a restart of some sort it reported that the SIM card was not supported on the phone. I suspect her iPhone, which she got from TMobile a couple years ago, is locked.

So she’s doing the voice and SMS only thing and I’m roaming on a super cheap data plan.

I know I’ve written about this issue dozens of times here at AVC but I find the idea that the phone provider can somehow dictate what SIM you put into it is nuts.

I also know that it’s easy to buy an unlocked iPhone these days and it is easy to get an iPhone unlocked post purchase. But even so, it seems crazy that this is how the phone market works in this day and age.

Our friends who we are traveling with are on a different carrier, either ATT or Verizon I suspect, and they too are not getting data roaming in Vietnam from their provider.

So if you plan to travel to Vietnam from the US, bring an unlocked phone and buy a SIM card at the airport. The coverage and speed on my data only SIM is great so far and it seems like a bargain, like most everything here in Vietnam which is an amazing country.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Video Of The Week: Tesla Powerwall

October 6, 2017 - 10:18pm

I am obsessed with the Tesla power wall product. We are getting them for the properties we own where we have solar.

This video below explains how the power wall works in combination with solar panels, the grid, and your electrical usage.

I particularly like this screen shot from the Tesla app that shows the power flows between the four systems:

Anyway, if you are as into this stuff as I am, you will enjoy this video.


USV TEAM POSTS:

Albert Wenger — October 16, 2017
Blog Panic (Backing Up Cloud Services)

Categories: Blog articles

Fun Friday: Jet Lag

October 5, 2017 - 7:37pm

I always struggle with jet lag but the Asia trip kills me like no other.

I’ve heard all sorts of suggestions like work out as soon as you arrive, swim every morning, start getting on Asia time a few days before you leave, and take Melatonin or even stronger drugs.

I have tried most of those suggestions over the years and while I feel like they all work to some degree I’ve come to the conclusion that it just takes time.

We are three days in and I’m hoping the worst is over.

Of course there is the jet lag upon return to deal with too.

Since it’s Friday (here in Asia), I thought we could discuss this topic in the comments and see what the AVC community does to handle jet lag.

Categories: Blog articles

The NYU Courant MS-CEI Program

October 4, 2017 - 4:55pm

I was on the board of NYU for almost a decade until recently stepping down. I learned a ton about NYU during that time and one of the things I learned was that NYU’s Courant Institute of Mathematical Sciences is one of the most prestigious math schools in the world.

In addition to a world class math program, Courant houses one of NYU’s three computer science programs (the others are at the Tandon School of Engineering and the Stern School of Business), and has a top notch machine learning faculty, including Yann LeCun, who also leads Facebook’s AI Research Team in NYC.

Courant is a special place where math, machine learning, and computer science come together.

And now Courant is offering a new Masters degree in Entrepreneurship in partnership with NYU’s Stern business school. It is called the MS-CEI Program.

The MS-CEI program is a Master’s degree in Computing, Entrepreneurship and Innovation, combining computer science courses from the Courant Institute (Graduate School of Arts and Science) and business courses from the Stern School of Business…. The MS-CEI is designed for computer science students and technology professionals interested in pursuing entrepreneurship or assuming leadership roles in innovative technology based organizations.

Here is a link to the program overview and sample courses.

The initial class will enroll in the Summer of 2018 and applications are due by December 2017.

If you are interested in this program and want to learn more, please share your contact info with NYU here.

Categories: Blog articles

Airpods (continued)

October 4, 2017 - 3:35am

I wrote a post a couple days about how much I like Apple’s Airpods and that I was going to miss them as I head back to Android.

Well it is a good thing I wrote that post and an even better thing that so many smart and informed people read AVC.

If you wade into the comments section to that post, you will see quite a few comments explaining that Airpods can be used with Android as standard bluetooth headphones. I also got quite a few emails from readers explaining that same thing.

I tried that this morning and I worked like a charm. So I get to keep my Airpods as I move back to Android. I’m thrilled. Now if I could only keep iMessage too. Then I’d have everything that is better about iPhone on my Android.

Categories: Blog articles

New Time Zone

October 3, 2017 - 6:33am

We are in Asia for the next three weeks and I will likely be posting in the mornings Asia time which means late afternoon/evenings in the US.

As much as I would love to meet regular readers on this side of the world, this is a long planned vacation with my wife and some good friends so I won’t be working or taking meetings.

But I do plan to blog. Some habits die hard and that is one of them.


USV TEAM POSTS:

Albert Wenger — October 11, 2017
Last Uncertainty Wednesday we dug deeper into understanding the distribution of sample means. I...

Categories: Blog articles

Guns And Mental Health

October 2, 2017 - 7:59am

Another mass shooting and the outcries that we must do something return.

I do think we need to do something and I am a fan of more gun safety regulation.

But we also need to enforce the laws that are on the books already.

I would imagine that the Las Vegas shooter used an illegal weapon last night.

Why can’t we enforce the laws that are already on the books?

And the people who commit these horrible crimes are mentally ill.

Anyone who could turn a gun on innocent people is clearly not right in their head.

So while we fight for more gun safety laws, a fight that is hard and where little ground has been gained in recent years, we should also fight for better healthcare for mental illness.


USV TEAM POSTS:

Albert Wenger — October 11, 2017
Last Uncertainty Wednesday we dug deeper into understanding the distribution of sample means. I...

Categories: Blog articles

Airpods

October 1, 2017 - 9:43am

I broke my Pixel a few weeks ago and have been using an old iPhone since then.

I was hoping to hold out until the new Pixel comes out, but I couldn’t hold out and got a new Pixel this week which I’ve now cut over to.

The one thing I am going to miss about the iPhone was the Airpods that I got when I went back to iPhone.

The Airpods are the best wireless headphones I’ve ever used, by a wide margin.

I am going to miss them.

I am going to find the closest bluetooth version of them I can for my new Pixel.

If anyone has any suggestions, I am all ears.

No pun intended.


USV TEAM POSTS:

Albert Wenger — October 9, 2017
Support idyll - Interactive Narratives

Categories: Blog articles

Audio Of The Week: Why Crypto Tokens Matter

September 30, 2017 - 4:22am

This is a conversation between two friends of mine; Chris Dixon, partner at Andreessen Horowitz, and Fred Ehrsam, co-founder of Coinbase.

It is excellent. I highly recommend it, particularly for those that want to make sense of crypto and what is happening in this market.

Categories: Blog articles

Funding Friday: Grow Your Own Lampshade

September 29, 2017 - 4:30am

I backed this project today and am excited to share it with all of you.

Categories: Blog articles

GDPR

September 28, 2017 - 4:56am

We have been spending a lot of time in Board meetings lately talking about GDPR.

GDPR stands for General Data Protection Regulation and is an EU regulation that, as written, will impact most Internet companies regardless of where they are located.

If you have not heard of GDPR and are running or working for an Internet company, you should wrap your head around it asap.

This Wikipedia entry does a pretty decent job explaining GDPR at a high level.

I heard someone explain GDPR as the “privacy equivalent of SOX.” I think that is a decent way to think about it.

This is serious regulation and complying is going to be hard and a lot of extra work. It will also impact product development and add overhead to that. The penalties for non compliance are massive and you cannot simply ignore this.

All that said, we did this to ourselves. The tech/Internet industry has run roughshod over user privacy for almost two decades now and we created the conditions for this regulation to pass.

The privacy equivalent of SOX.

So wrap your head around GDPR and prepare your company to comply. There is no other option.

Categories: Blog articles

Longer Tweets

September 27, 2017 - 4:32am

I’ve got mixed feelings about Twitter’s experiment with allowing longer tweets (280 characters vs 140).

Like many users expressed on Twitter (of course) yesterday, I’m quite fond of the 140 character limit.

I don’t like the constraint when I compose tweets, but I love it when I consume them.

There are few things that make Twitter unique, defensible, and essential (contrary to many Twitter haters, it is all of those things).

At or near the top of the list is the sort bursty stream of information Twitter presents to the consumer.

There is no other place where I can consume a firehose of information across so many topics as quickly as I can on Twitter.

Just looking at these tweets from Jack and Biz, I am not sure 280 characters is going to be a good thing for the consumption experience.

This is a small change, but a big move for us. 140 was an arbitrary choice based on the 160 character SMS limit. Proud of how thoughtful the team has been in solving a real problem people have when trying to tweet. And at the same time maintaining our brevity, speed, and essence! https://t.co/TuHj51MsTu

— jack (@jack) September 26, 2017

Originally, our constraint was 160 (limit of a text) minus username. But we noticed @biz got 1 more than @jack. For fairness, we chose 140. Now texts are unlimited. Also, we realize that 140 isn’t fair—there are differences between languages. We’re testing the limits. Hello 280!

— Biz Stone (@biz) September 26, 2017

On the other hand, I think running experiments like this is the right thing for Twitter and every app out there to do.

And they can’t run an experiment like this without telling the world about it. I’m seeing longer tweets in my timeline. They can’t keep that a secret.

The one piece of advice I would give the Twitter product team (who explained themselves in this blog post) is that they should test 160, 180, 200, 220, 240, 260, and 280.

I suspect they will get the biggest impact with slightly longer tweets but not all the way to 280.

I frequently run out of characters in my tweets. But generally not by a lot. If I had another 20 or 40 characters, that would reduce my character limit frustration significantly.

It’s also easier to introduce gradual change to a user experience than radical change.

And doubling the tweet size is a pretty radical change.

So I’m glad everything is on the table at Twitter in an effort to improve the user experience. That’s how it should be. But I’d be careful about this experiment and test a wider range of tweet sizes if I were them.

Categories: Blog articles