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Behavior Change

June 9, 2020 - 6:46am

As I’ve mentioned a few times here during the pandemic, I’m very interested to see what behavior changes that we adopted during the pandemic will stick when it eases and which will not.

Mask wearing, for example, has been commonplace in Asia for many years but not so in the west. I suspect that will change now. Anytime I don’t feel well and need to go out, I plan to wear a mask as is the practice in many Asian cultures. My guess is the Covid pandemic will make that quite common in most parts of the world now.

Another one is food delivery. Apparently only about 3% of US households used online food delivery services before the pandemic. Many more adopted them during the pandemic. Some will go back to the grocery store in the coming months but many will not. The adoption hurdle has been cleared and online food delivery is now in the mainstream. Full disclosure, USV has a few companies in our portfolio that benefit from this trend.

Another is telehealth. Many of us did one or more doctor appointments over video during the lockdown. For something simple like a prescription refill or a checkin, it worked quite well for me. I don’t plan to stop seeing my doctor in person when I feel it is necessary, but I welcome the option to do it over video when it is not. USV also has a few companies in our portfolio that benefit from this trend.

Maybe the most impactful behavior change that many of us have adopted during the pandemic is working from home. The home part has been challenging for many. But the idea that we can be productive and effective outside of the office is a game changer for many employees and many employers. I suspect most knowledge industries will make material moves toward hybrid models post pandemic.

The next 6-18 months, the time most experts think we will still have material risk from the virus, will be an interesting period to study these behavior changes and get a sense of what will stick and what will not. Now that most parts of the US have reopened but are still being careful, we can watch and learn and possibly get a head start on understanding how all of this will play out in the future.


USV TEAM POSTS:
Categories: Blog articles

Reopening

June 8, 2020 - 4:03am

Today, NYC starts the process of reopening its economy from almost three months of lockdowns to halt the spread of Covid 19.

It is time. The city has massively reduced the spread of the virus in those three months. Here is a chart of infections and testing in Brooklyn over the last three months:

The two things about that chart that get my attention are that the virus is still out there and that testing has massively increased.

Almost 80,000 people were tested in New York State last Thursday, almost 30,000 of them in New York City.

I hope we keep up this level of testing. If we have a uptick in cases as a result of reopening, we can see them, trace them, and react to them. I hope we don’t have an uptick in cases, but now we are so much better prepared to deal with them if we do have them.

Phase one of NYC’s re-opening plan means construction, manufacturing, wholesale and non essential retail businesses will be allowed to reopen.

We are reopening several construction sites that the Gotham Gal and I are running right now. They have been closed since early March. I am so happy that the workers are coming back to work. And we will run those jobs with the proper safety precautions on the job sites to make sure they are safe for the workers.

I am excited to see stores reopen. The lockdown has been very hard on small business owners and I am hopeful that they can rebuild their businesses while remaining under constraints. I plan to shop at stores that are reopening.

But even with all of this energy around reopening, I expect that we will continue the mask wearing and social distancing that we perfected over the last three months. I know that I will.

NYC was the hardest hit of any location in the US this spring with over 200,000 of known cases and likely millions of actual infections. Over 50,000 people were hospitalized and over 20,000 probably died from Covid related illness.

That’s a huge toll. I have lived through many tough moments in my adopted hometown over the last forty years and I think this is the toughest of them all. I think NYC faces enormous challenges recovering from the pandemic, which is still going on and will continue to go on until we have a widely available effective vaccine.

But today is step one of that recovery and I am hopeful and excited to get going again.


USV TEAM POSTS:
Categories: Blog articles

Funding Friday: The George Floyd Memorial Fund

June 5, 2020 - 5:37am

I saw this tweet last weekend and immediately thought “he is right.”

I really wish @fredwilson had used his Funding Friday to talk about George Floyd’s memorial fund or Minnesota Freedom Fund but I guess solar power is more promising than black people getting justice right now.

— joahspearman (@joahspearman) May 30, 2020

So under the theory that late is better than never, I made a donation to The George Floyd Memorial Fund and I am highlighting it to all of you today.

This fund was set up by George’s sister to “cover funeral and burial expenses, mental and grief counseling, lodging and travel for all court proceedings, and to assist our family in the days to come as we continue to seek justice for George.  A portion of these funds will also go to the Estate of George Floyd for the benefit and care of his children and their educational fund.”

This campaign is now approaching $13mm and will cover all of that and also possibly much more. This fund won’t make George’s murder right, but it will help his family do right by his memory. And that is a very good thing.


USV TEAM POSTS:
Categories: Blog articles

Black Lives Matter

June 4, 2020 - 5:01am

I believe that Black lives matter.

I understand that the phrase Black lives matter speaks to a movement to stop the murders of Black people at the hands of the police. I also understand that it speaks to a broader protest movement seeking to reduce the unchecked power of the police. I support these efforts and am sympathetic to them.

But the words Black lives matter mean even more to me.

They mean that a Black person’s life matters as much as any other person’s life.

They mean that the living situation of a Black person matters as much as anyone’s living situation.

They mean that the food a Black person eats matters as much as the food anyone eats.

They mean that the health care that a Black person has matters as much as the health care anyone has.

They mean that the education a Black person has matters as much as anyone’s education.

And they mean that the economic opportunity that a Black person has matters as much as anyone’s economic opportunity.

My record and that of the USV is poor on that last measure.

We have spent much of the last week at USV talking about that and we talked about it publicly on our blog and Twitter yesterday.

When the collective minds at USV focus on something we have always met our goals.

While we are late to put our collective minds on this opportunity, we are not too late. And we have already started our work on it.

We will do this the way we do everything at USV. We will stick to our thesis of access to capital, knowledge, and well-being. We will back teams that are working on these problems in ways we think are impactful. And we will be engaged, honest, and present in the work.


USV TEAM POSTS:

Nick Grossman — Jun 11, 2020
The 1k Project

Albert Wenger — Jun 10, 2020
Meet Clarity

Categories: Blog articles

Talking About It

June 3, 2020 - 4:11am

I took the day off from AVC yesterday in observance of the moment we are living through. It is a very difficult time.

I spent part of yesterday talking to a number of the leaders of our portfolio companies who are trying to find a footing in this moment and provide the right leadership for their teams. My main advice to them was to talk about what is going on with the entire team, listen to how they feel, and engage now more than ever. I’m hopeful that the right answers for each team will come out of that. I think it is a time to be talking right now.

While I did not write yesterday, my partner Albert did. And he didn’t say much, but what he said was powerful. I agree with him.

It is a confusing time, an infuriating time, and a difficult time.

It is also time to take stock of what we believe, as Albert did, and act accordingly.


USV TEAM POSTS:
Categories: Blog articles

A New Month

June 1, 2020 - 3:37am

I woke up at dawn today. The sun was lightening the sky. The birds were chirping.

I was reminded of the power of a new day, a clean slate, new opportunities.

It is June.

After three months of pandemic lockdowns, job losses like I have not seen in my lifetime, and a week of turmoil in our streets and in our hearts, we have the hope that comes with a new day.

Clearly we have problems in our country and our world.

When the tide goes out, you can see who has been swimming naked. And so many of us have been swimming naked. The pandemic has been quite revealing.

It is time to make some changes. Big changes. Long overdue changes.

We can start by acknowledging that.

And then we should seize the opportunity that comes with a new day, a new month, a new set of priorities, to make those changes.

We simply need to courage and conviction to come together and do it.


USV TEAM POSTS:
Categories: Blog articles

Funding Friday: Tesla Powerwall Clone Guide

May 29, 2020 - 4:21am

I am a big fan of pairing solar panels on the roof with a battery system in the garage. The battery allows you to use the solar power at night when there is no sun. It also provides resilience for power outages and the like.

So when I saw this Kickstarter project, I backed it immediately.

The premise is simple enough. Find a battery pack out of a wrecked hybrid or EV vehicle at a junkyard and using simple off the shelf tools and materials convert it into a battery system capable of being charged from a variety of sources (solar, wind, grid, water, etc) and power a house’s basic necessities during the midst of a crisis or during times when power is more expensive (during the day) while replenishing when power is either abundant or cheaper, like at night. While this information is available currently, most of whats out there is long, wordy, confusing and in some cases conflicting.

https://www.kickstarter.com/projects/khohnholz/homebrew-tesla-powerwall-clone

I went for the $20 pledge which comes with a complete users guide.

Now I need to find a “wrecked EV.” This should be a fun project.


USV TEAM POSTS:
Categories: Blog articles

Contact Tracing and Technology Conference

May 28, 2020 - 4:08pm

As I wrote about a few weeks ago, I am excited about the possibility that technology, particularly mobile computing technology, can supplement the work of manual contact tracing to keep us all safer until a permanent solution is found to this pandemic.

But there is a ton of confusion about what contact tracing is, what exposure alerting is, what the role of legacy contact tracing systems are, and what role new applications can play in this moment.

So I was thrilled that a group of organizations that operate at the intersection of public policy and tech innovation are putting on a series of online conferences on this topic.

The first one will be next Wednesday from 11am ET/8am PT until 2pm ET/11am PT and will focus on the consumer apps that are being built on top of the Google and Apple APIs. There will be demos of many of these new apps and a series of panel discussions. If you are interested in attending (attendance is unlimited), you can RSVP here.

There are four of these online events planned over the next two months (roughly every two weeks) and they will cover enterprise contact tracing applications, what is happening internationally, and more.

The organizations behind this series of online events are The COVID Tech Task Force, Harvard’s Berkman Klein Center, NYU’s Alliance for Public Interest Technology, TechCrunch, Betaworks Studios, and Hangar.

If you work in government and are involved in making tech decisions in this area, if you are interested in how tech can help address large scale public health issues, or if you are just curious about all of this, I hope you will attend. I plan to do that myself.


USV TEAM POSTS:
Categories: Blog articles

Coinbase + Tagomi

May 27, 2020 - 5:38am

Our portfolio company Coinbase announced yesterday that it will acquire Tagomi to build out its institutional prime brokerage business.

This is an important moment in the maturation of the crypto trading business. At USV, we have used Coinbase to transact in the crypto markets and I’ve wanted advanced offerings like we get when we transact in the stock markets like buying or selling on a volume weighted average price (VWAP) and other things like that. Tagomi will bring those kinds of offerings to Coinbase and that will make it easier and better for institutions like USV to trade with Coinbase.

This is also a bit of a reunion for USV as one of Tagomi’s founders, Jennifer Campbell, was an analyst at USV when she co-founded Tagomi. Though USV was not an investor in Tagomi, we’ve always been rooting for Jennifer and her colleagues. Now, as part of Coinbase, we are all on the same team again.

Slowly but surely crypto assets are becoming mainstream holdings for institutions and the prime brokerage offerings from Coinbase will help accelerate that transition.


USV TEAM POSTS:

Union Square Ventures — Jun 3, 2020
An Appraisal

Nick Grossman — Jun 3, 2020
Listening

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

Streaming Vs Torrenting

May 26, 2020 - 7:44am

Last night at dinner we got to talking the film Barfly, which came out the year the Gotham Gal and I were married, so a long time ago now. We decided to watch it after dinner with our family and friends we are quarantining with.

Well it turns out that Barfly is not available to be streamed on any of the many streaming services we have on our AppleTV (at least ten of them). After a frustrating twenty minutes figuring that out, we thought about torrenting it and watching it that way.

But for a bunch of reasons, we decided not to do that and went with another film.

A decade ago, I wrote a lot about how streaming would kill piracy (it largely has) and how I feel about piracy when I can’t consume legally (I am fine with it).

This morning I was talking to one of our friends over breakfast and said that I am going to put a bitorrent client on the Mac Mini that is connected to our family room TV because if we try as hard as we can to pay for a film legally and cannot, then I feel OK with getting it some other way.

I am just a bit shocked that is even necessary to do in the golden age of streaming.


USV TEAM POSTS:

Union Square Ventures — Jun 3, 2020
An Appraisal

Nick Grossman — Jun 3, 2020
Listening

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

Remembering Our Fallen Soldiers

May 25, 2020 - 6:02am

On today, Memorial Day, we remember our fallen soldiers.

I spent some time today going back over old blog posts I’ve written on this topic and landed on a post I wrote almost ten years ago, when I visited the Normandy beaches with my wife and son. It was a very powerful and moving experience for us.

I am glad we take a day every year to remember the men and women who lost their lives in service of our country.

And while we can’t all go lay a wreath or march in a parade today, we can take a moment of reflection on their sacrifice and what it has meant for our country.


USV TEAM POSTS:

Union Square Ventures — Jun 3, 2020
An Appraisal

Nick Grossman — Jun 3, 2020
Listening

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

Funding Friday: In Time of Plague

May 22, 2020 - 4:09am

I backed this photo book project today. The creator took photos of the Williamsburg neighborhood in Brooklyn during the more than two-month lockdown in March, April, and May 2020 and will produce a photo book.

I really like what he says at 1:50min into the excellent project video (link here for those reading on email).

It’s undeniably a difficult time to produce a book, but I believe that art is more important than ever in times of crisis like this. Museums and galleries are struggling to stay afloat and publishers require painfully long time frames to produce books. We as a community can work more nimbly and quickly, which is needed in this historic moment.

Well said Brian. Well said.


USV TEAM POSTS:

Union Square Ventures — Jun 3, 2020
An Appraisal

Nick Grossman — Jun 3, 2020
Listening

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

The Startup Job Market

May 21, 2020 - 4:54am

My colleague Matt Cynamon told our partnership last week that the number of jobs on the USV job board had declined from 1,553 to 871 in the past month. So we suggested he share that data and some observations on the USV blog. He did that yesterday.

Here is the chart of open jobs on the USV job board:

https://www.usv.com/writing/2020/05/how-covid-is-impacting-hiring/

A large number of those 871 open jobs are in a handful of larger USV portfolio companies that are leaning into this moment to build their teams. Many USV portfolio companies have frozen hiring or have tightened it significantly. And there have been reductions in force as well in some parts of our portfolio.

But all is not bleak. Matt ends his post with the following observation:

In our next post we’ll explore some areas where we’re seeing major opportunities for job seekers.

https://www.usv.com/writing/2020/05/how-covid-is-impacting-hiring/

I am hopeful that hiring will start to pick up in our portfolio in the second half of the year as our portfolio companies start to understand where their businesses are now and where they are headed this year and next.


USV TEAM POSTS:

Union Square Ventures — Jun 3, 2020
An Appraisal

Nick Grossman — Jun 3, 2020
Listening

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

Fiber To Home

May 20, 2020 - 1:52pm

I’ve been working on getting a fiber internet connection to the home we are quarantining in. With nine of us living and working from home together, we are consuming a lot of bandwidth. And with everyone on our block doing more or less the same thing, the cable internet connections we all have are bogged down.

As I understand it, cable internet suffers from a few problems relative to fiber. The bandwidth in cable is usually (always?) non symmetric, meaning the upload speeds are not nearly as good as the download speeds. For applications like browsing the web, that’s fine. For applications like videoconferencing, that’s not so fine.

I also believe that cable bandwidth is frequently shared with your neighbors whereas fiber is usually a direct connection to the telco’s main internet connection. That means if your neighbors are using a lot of bandwidth, that can slow you down if you use cable, but not if you have fiber.

These are things I’ve heard over the years and believe to be true but I am happy to be corrected on Twitter (click the button below) if I am wrong about any of this.

In any case, we are moving to fiber in an effort to make our large group work from home situation a bit better for everyone. And I suspect that I am not the only one doing this right now.

USV has two fiber investments, Ting (owned by Tucows) and Pilot, and I believe that both will see demand for their services increase this year and beyond as we all need and want more bandwidth.


USV TEAM POSTS:

Albert Wenger — Jun 2, 2020
American Carnage

Categories: Blog articles

American Kingpin

May 19, 2020 - 6:07am

I read my friend Nick Bilton‘s book American Kingpin over the last few weeks. It is the story of Ross Ulbricht (aka Dread Pirate Roberts), the founder and owner of The Silk Road.

It is a fascinating story with many angles; drug and arms dealing, entrepreneurship, criminal investigation, and much more. I highly recommend the book.

It reminded me that The Silk Road was the original product market fit for Bitcoin. According to Wikipedia:

The total revenue generated from these sales was 9,519,664 Bitcoins, and the total commissions collected by Silk Road from the sales amounted to 614,305 Bitcoins. These figures are equivalent to roughly $1.2 billion in revenue and $79.8 million in commissions, at current Bitcoin exchange rates…”, according to the September 2013 complaint, and involved 146,946 buyers and 3,877 vendors

https://en.wikipedia.org/wiki/Silk_Road_(marketplace)

Those 9.5mm bitcoins, which certainly recirculated a fair bit, represented roughly all of the circulating supply of Bitcoin at that time.

That does not mean that all of the bitcoins that had been mined at that time were in use on The Silk Road. A much smaller percentage of them recirculated back and forth between customers and suppliers in the market.

But I have always believed that The Silk Road was where Bitcoin first found a massive use case and it was where many people first bought and used Bitcoin.

This has led to a narrative around Bitcoin and crypto that it is shady and only useful for illicit behavior. That is unfortunate and not true.

Many technologies that ultimately find mainstream use cases (the web browser, the VHS, etc) find initial product market fit in areas that are edgy at best. And such was the case with Bitcoin and crypto.

These “edgy” use cases prove out the technology, provide an initial user base, and lead to more mainstream adoption down the road. And that is what happened with Bitcoin and The Silk Road.


USV TEAM POSTS:

Albert Wenger — May 29, 2020
The Social Media Triangle

Categories: Blog articles

Kickstarter Lights On

May 18, 2020 - 4:28am

So many of our favorite community anchors have shuttered in the wake of the pandemic. And reopening them won’t be easy.

Music venues, movie theaters, art galleries, restaurants, performance spaces, maker spaces, conferences, festivals, and bookshops are the places we hang out in, enjoy each other, and and connect to art and culture.

But these spaces also have communities of people connected to them, rooting for them, and eager to help them.

Enter Kickstarter, the crowdfunding platform for bringing creative projects to life (and a USV portfolio company).

Kickstarter is not charity, although there is certainly a need for charity in this moment. Kickstarter is a platform to engage your community, reward them, and encourage them to support your work.

A few weeks ago, Kickstarter launched Lights On, a call for projects that “sustain your cultural space, event series, creative organization, or independent business”.

https://www.kickstarter.com/lights-on

If you own or operate a cultural space, a local beloved business, an event series, or some other community treasure and want to engage your community in your reopening plan, Kickstarter Lights On is for you.

You can learn more about it here.


USV TEAM POSTS:

Matt Cynamon — May 20, 2020
How COVID Is Impacting Hiring

Albert Wenger — May 20, 2020
#DIYInternship

Categories: Blog articles

Funding Friday: Keep The Faith NYC

May 15, 2020 - 4:34am

I just backed this project and got myself a great hoodie to wear this fall when we hope to be back in NYC.


USV TEAM POSTS:

Matt Cynamon — May 20, 2020
How COVID Is Impacting Hiring

Albert Wenger — May 20, 2020
#DIYInternship

Categories: Blog articles

r/CryptoCurrency Moons

May 14, 2020 - 12:18pm

We have been looking for ways in which crypto assets can go mainstream. Our interest and investment in Dapper’s crypto games is an effort in that area. So is our involvement in the Libra project.

We also have been involved in legacy mobile and web apps that have built cryptocurrencies inside of them. Kin and Props are two examples of that.

But we are also always looking outside of our own portfolio for examples of ways in which crypto assets can go mainstream.

And I saw yesterday that two subreddits, r/Cryptocurrency and r/FortNiteBR, have issued crypto assets on the Ethereum blockchain using the ERC20 token standard. The crypto asset associated with r/Cryptocurrency are called Moons. The crypto asset associated with r/FortNiteBR are called Bricks. They are very similar assets but they are not the same.

I don’t play FortNite but I do own cryptocurrencies, so I am a bit more interested in Moons and hope to accumulate them by actively engaging in the r/CryptoCurrency community.

Here is how Moons work.

Moons are a new way for people to be rewarded for their contributions to r/CryptoCurrencyThey represent ownership in the subreddit, they are tokens on the Ethereum blockchain controlled entirely by you, and they can be freely transferred, tipped, and spent in r/CryptoCurrencyClaim your Moons in the new Vault section of the Reddit iOS or Android app! It will be rolled out gradually over the next two days and will be in beta testing until later this summer.

https://www.reddit.com/r/CryptoCurrency/comments/gj96lb/introducing_rcryptocurrency_moons/

The new Vault section of the Reddit mobile app now has an Ethereum wallet that can store Ethereum tokens, like Moon. And as you engage in the community, you earn Moons in your wallet.

I think this is an interesting experiment and could bring more users into the crypto ecosystem. I hope to earn some Moons over the next few months and you may want to do the same.


USV TEAM POSTS:

Matt Cynamon — May 20, 2020
How COVID Is Impacting Hiring

Albert Wenger — May 20, 2020
#DIYInternship

Categories: Blog articles

Location and Work

May 13, 2020 - 6:25am

I am confident this pandemic will end. At some point, we will have a vaccine, therapeutics, and/or broad based immunity. When that will happen is less clear to me. I believe that at some point, we will be able to resume living and working as we did prior to the pandemic.

However, I am also confident that we will not resume living and working exactly as we did prior to the pandemic because some of the things we have adopted to get through this will reveal themselves as comparable or better than what we were doing before.

One of the places this is happening is knowledge work which is a growing percentage of the workforce in the US. What we have seen in this pandemic is that knowledge workers have been able to be comparably productive working from home and that has caused many large (and small) employers to consider different work/location options.

Yesterday, Twitter told their employees that most of them can work from anywhere going forward:

News: Twitter will allow its employees to work from home forever. @jack just emailed the company about it. Details here: https://t.co/KvvozuQ8Qn

— Alex Kantrowitz (@Kantrowitz) May 12, 2020

A number of our portfolio companies have made that decision already as well:

This week, we rolled out Work from Anywhere.

– Will keep our NYC office as HQ (these are desks at a co-working space)
– Anyone can work from anywhere in the U.S.

— Michael Karnjanaprakorn (@mikekarnj) April 22, 2020

I can imagine large and small banks, law firms, accounting firms, media and entertainment companies, and other knowledge based businesses making similar decisions.

I am not saying that remote work is ideal. There is something very valuable about being able to be in the same physical space as your colleagues. USV will likely keep an office for exactly that reason.

But it is also true that USV is operating incredibly well during this pandemic and we have not (yet) missed a beat.

What this means for large cities where many companies that engage in knowledge work are centered is an interesting question.

I saw this chart this morning on Benedict Evans’ Twitter:

People have been calling the end of SF for long time, but it’s worth remembering just how much the price delta has opened up in the last decade. For many people it no longer matters how driven you are if you can’t afford a second bedroom pic.twitter.com/4suajjd1gS

— Benedict Evans (@benedictevans) May 13, 2020

That compares two of the most expensive cities in the US (and world) to each other. And as bad as NYC is on the affordability index, SF is way worse.

So when you combine these two situations; large knowledge work hubs getting prohibitively expensive and remote work normalizing, it would seem that we are in for a correction.

What is less clear is where knowledge workers who can increasingly work from anywhere will choose to live (and work). Will cities remain attractive for the quality of life they offer (arts, culture, nightlife, etc)? Or will the suburbs stand to gain? Or will more idyllic locations like the mountains or the beach become the location of choice? Or will second and third tier cities become more attractive? I do not have a crystal ball on this question. I suspect it will be some of all of the above.

But this may become a big deal. Like the “white flight” that happened in the 50, 60s and 70s in a number of large cities in the US. Wholesale movement of large groups of people can have profound changes on regions.

Like many disruptions, this is both bad and good. Affordability (or lack thereof) and gentrification have been a blight on our cities. If we can reverse that trend, much good will come of it. This may also be helpful in addressing the climate crisis which remains the number one risk to planet Earth. So there are reasons to be excited about this. But wholesale abandonment is terrible. We should do whatever we can to avoid that.

It is early days for this conversation. But it is one we are going to have all around the US, and possibly all around the world. So it is time to start thinking about it.


USV TEAM POSTS:

Matt Cynamon — May 20, 2020
How COVID Is Impacting Hiring

Albert Wenger — May 20, 2020
#DIYInternship

Categories: Blog articles

Investing In Learning

May 12, 2020 - 4:40am

USV has invested in the education sector for a bit more than ten years. We kicked things off with an event we called Hacking Education back in March 2009.

We have focused on “direct to learner” businesses and have mostly avoided investing in companies that sell to the established education system.

This has been a good strategy and we have assembled a fantastic direct to learner portfolio that includes companies like Duolingo, Quizlet, Skillshare, Codecademy, and Outschool.

We’ve been doing some work to understand this portfolio in the light of this remote learning moment we are in.

This portfolio reaches hundreds of millions of learners all around the world each month. Many learners use these products for free. A small percentage of learners pay. And yet this portfolio will generate close to a half a billion dollars of revenue in 2020.

Another interesting thing about this portfolio is that none of these companies have spent a lot of capital building their businesses. They have all been very capital efficient and most are cash flow positive at this point.

What this tells me is that direct to learner businesses are very attractive. They can serve a very large number of learners very efficiently, they can lightly monetize and yet produce massive revenues because of their scale, and they don’t require a huge amount of capital to build.

We hope to find more businesses like this to invest in as we think we are just at the beginning of rethinking how we want to learn and educate.

If you want to see some of this in action, you should check out Codecademy’s Learn From Home Day tomorrow, May 13th, starting at 10:45am ET. It looks to be a fun day of learning.


USV TEAM POSTS:

Matt Cynamon — May 20, 2020
How COVID Is Impacting Hiring

Albert Wenger — May 20, 2020
#DIYInternship

Categories: Blog articles