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Musings of a VC in NYC
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No Shenanigans

November 12, 2019 - 11:49am

I was talking to a friend today about company values and how important they are but also how lame so many of them are.

I told him that some of my favorite company values come from our former portfolio company Twilio (which in the spirit of full disclosure I am still a large shareholder of).

Twilio’s founder and CEO Jeff Lawson gave a great talk on company values at USV a few years ago and explained how he approached them. This blog post (and audio post) is about a similar talk he gave at First Round.

Twilio’s company values are shown below:

My favorite of them is “No Shenanigans” which translates to “Be thoughtful. Always deal in an honest, direct, and transparent way.”

It is such a great value. It is memorable. It is broadly applicable. It is interpretable. And I can imagine team members running their decisions against it and getting a helpful result that guides them.

That is what company values are all about at the end of the day – helping people make decisions that everyone in the company will be proud of and supportive of.

Like most things that are incredibly valuable, values are not easy to get right, but they are worth investing a lot of time and energy in.

Categories: Blog articles

Pixel 4XL

November 11, 2019 - 4:04am

I got a new Pixel 4XL phone a week ago and it took me most of the week (it was a busy one) to migrate over to it. I wrote a bit about how I’m careful about the migration last week.

I like to upgrade to the new Pixel flagship phone every fall when Google tends to ship them. It generally means longer battery life, better camera, and some other nice things.

Last year, we got fingerprint biometrics.

This year, we got face recognition, something iOS users have had for at least a year now.

Face recognition is super nice. I already love it.

This new Pixel 4XL also has something called MotionSense which allows a user to control the phone without actually touching the screen. You wave across the phone with your hands.

For now, MotionSense only silences interruptions and skips songs on many popular music apps. Hopefully, Motionsense can be incorporated by third-party apps. If that is the case, I can see this becoming a really useful thing.

The Android UI has changed a bit on the Pixel 4XL and it has taken me a few days to get used to the new ways to get around the phone but I am quickly getting there.

I’m glad I made the upgrade even though the migration was a real effort. Many readers suggested better ways to do 2FA with easier migration. I got the message and that is on my to-do list now. Thanks.

Categories: Blog articles

Priorities

November 10, 2019 - 6:06am

It is planning season when management teams work to develop the roadmap for the coming year.

The truth is that it is hard to do more than two or three big things at a time, no matter how large you are.

So it is important to put all of the things that the business needs or wants to do on the table and have a vigorous debate about them and then pick a few priorities to focus on.

Saying no to things that you really want to do is the telltale sign of a good planning process. Saying yes to too many things is the telltale sign of a poor planning process.

What makes this process particularly hard is that there are often a few things that the business has to do and there is no way to delay them. These must do efforts can often crowd out the should do projects and that leads to a lack of forward progress.

The lens through which I evaluate plans is as follows. First there should be a few well defined priorities. I like two or three but four can work. Five starts to be a problem. At least one and possibly two should be must do things the existing business requires and cannot be put off. And there should be at least one big new effort that will move the business forward.

Planning is so important. When you get the plan right, execution becomes so much easier. I have found that poor execution is most often a function of poor planning and trying to do too much without clear priorities. Even the strongest operators struggle in a situation like that.

Categories: Blog articles

Video Of The Week: Mike Bloomberg Talks Climate Crisis At MIT

November 9, 2019 - 7:12am

This spring, Mike Bloomberg gave the commencement speech at my alma mater MIT. He talks about moonshots, engineers, and the looming climate crisis. It is a great talk and one that shows what kind of leader I would like to see in this country.

I start the video below at 3:24 in so you don’t have to watch the traditional commencement platitudes. If you want to watch the entire thing you can do that here. The video below is about 18mins in total and I strongly recommend everyone find the time to watch it this weekend.

Categories: Blog articles

Funding Friday: Mochi Robot

November 8, 2019 - 4:15am

I’m a huge fan of toys and other things that can get young kids engaging in instructing machines what to do. I think that in the world these children are going to grow up into, that is going to be super important to them as adults.

And so toys like Mochi Robot are great for parents, teachers, and caregivers who want to provide that to their children.

Categories: Blog articles

How To Beat A Patent Troll

November 7, 2019 - 5:03am

Our portfolio company Cloudflare posted yesterday about the two and a half year war it waged against a patent troll called Blackbird.

This was the battle plan that Cloudflare came up with:

After we were sued by Blackbird, we decided that we wouldn’t roll over. We decided we would do our best to turn the incentive structure on its head and make patent trolls think twice before attempting to take advantage of the system. We created Project Jengo in an effort to remove this economic asymmetry from the litigation. In our initial blog post we suggested we could level the playing field by: (i) defending ourselves vigorously against the patent lawsuit instead of rolling over and paying a licensing fee or settling, (ii) funding awards for crowdsourced prior art that could be used to invalidate any of Blackbird’s patents, not just the one asserted against Cloudflare, and (iii) asking the relevant bar associations to investigate what we considered to be Blackbird’s violations of the rules of professional conduct for attorneys.

I will give away the story in case you don’t want to go read the post. Cloudflare’s plan worked in all three ways.

It is tempting to settle with patent trolls if you can settle for less than litigation costs. Our portfolio companies do it all the time and it is rational behavior.

But patent trolls are a tax on innovation and I love it when some of our portfolio companies decide to stand up to them and fight them. Like Cloudflare did.

Categories: Blog articles

A Decentralized Archive

November 6, 2019 - 4:03am

The Internet Archive and Wayback Machine are awesome.

You can see that in 1998, AVC.com was pointing to something called Fishnet that looked like this. And you can see what AVC looked like in September 2008.

There are many archives, some of them quite specialized, in the physical and digital world. But they all suffer from the same problem, which my colleague Dani explained yesterday:

Archives are extremely important: the survival and ongoing availability of knowledge helps with the continuation of human progress. While there are existing digital archival projects out there, they are mostly donation-based and face the risk that their funding could run out, their hosting provider could one day go out of business or a government could force them to remove files.

Dani wrote that yesterday in our blog post welcoming Arweave to the USV portfolio. Arweave is a decentralized protocol that enables archiving and the funding to support it at web scale.

The key innovation is a sustainable funding model for archives which Dani explained in her post:

Arweave had to invent a new method of paying for storage, one where you can pay once, and store forever. While that sounds almost too good to be true and took us a long time to wrap our heads around, it will be true provided the cost of storage continues to decline at a predictable rate. Machines that provide storage to the network get paid out in small increments over time as they continue to prove that they have held onto archived files. 

Decentralized infrastructure is one of our favorite investment themes in crypto (Filecoin, Helium, Arweave, and at least one unannounced investment) because of the resiliency and sustainability of decentralized infrastructure (just look at bitcoin mining for an example of that).

We think infrastructure will tend to move to decentralized models over time and archives are a great example of that.

Categories: Blog articles

The DuckDuckGo Browser

November 5, 2019 - 1:08pm

I just started using our portfolio company DuckDuckGo’s mobile browser.

Honestly I didn’t even realize they had one until last week.

It looks like this on my phone:

And AVC looks like this in it:

I guess AVC is only a B+ when it comes to privacy. I hope to fix that and get to an A when I push the new design, hopefully next month.

If you want to start using the Duck Duck Go mobile browser, you can get it here.

Categories: Blog articles

Calling All Founders

November 4, 2019 - 3:48am

NYC’s Partnership runs some outstanding accelerator programs.

There is the flagship Fintech Accelerator which is celebrating its 10th anniversary this year. In this program, founders are connected to the CIOs of the top banks, brokerages, and insurance companies in NYC as they work on their products and pitches. Over the past decade, 69 graduates of the Fintech Accelerator have raised over $1bn. I have written about this program frequently. It is an example of something that you could not do anywhere other than NYC.

And then there is the newest one, the Transit Tech Accelerator, where founders who are building transit companies are connected to the leading transit systems in the NY Metro area while they work on their products and pitches. The MTA is piloting four technologies they found in last year’s program and there are six more transit systems involved this year.

If you want to apply to the Fintech Accelerator, do so here.

If you want to apply to the Transit Tech Accelerator, do so here.

Categories: Blog articles

Upgrading To A New Phone

November 3, 2019 - 8:22am

I got the new Pixel 4 XL and am in the process of copying over all of my data and apps and other stuff.

Apple and Google make it so easy these days to sync a new phone with an old phone that it is easy to think you are done once the sync is over.

But that is unfortunately not the case.

The biggest “gotcha” that I worry about is moving all of my two-factor codes over from my old phone to my new phone. For that reason, I keep my old phone around for a few weeks just to make sure I’ve got it all moved over to my new phone.

And then there is the hassle of logging into all of my apps and signing into them all over again. I have and use a lot of apps on my phone so that takes me several hours over the course of a few days to do that. And that is another reason to keep my old phone around for a while to make sure I’ve got everything.

Increasingly Apple and Google and other providers want you to trade in your older phone for a discount on a new one. While that is an attractive offer, it encourages wiping and sending the old phone back.

And I don’t think that’s a smart thing to do until you are sure you’ve got everything you need off of your older phone.

Categories: Blog articles

Video Of The Week: Filecoin and Web3

November 2, 2019 - 7:08am

In this video, Juan Benet, founder of our portfolio company Protocol Labs, talks about how Web3 is coming together and what Filecoin and IPFS’s role in it will be.

Categories: Blog articles

Funding Friday: The Electronic Frontier Foundation

November 1, 2019 - 2:16am

The Electronic Frontier Foundation (EFF.org) has been fighting for and helping to protect our online rights for twenty-eight years. Their primary focus areas are online privacy and free speech.

They spend about $12mm a year on legal interventions and policy work. Most of their funding comes from small donations from people like us who value the work they do on our behalf.

I signed up for an annual membership this morning and will be contributing $2500 a year to this amazing organization. I also got this awesome EFF ski hat.

I would like to encourage all of you get to read what I think free of censorship to support their work as well. You can make a one-time payment of as little as $25 or as much as I did and you can also make that a recurring payment, as I did.

You can do all of that here.

Categories: Blog articles

The World Is Messy And There Are Ambiguities

October 31, 2019 - 2:56am

I’ve been wanting to say something like this here at AVC for several years and have held back for a host of reasons, mostly because it’s a sensitive topic and it would be misunderstood.

But after watching Obama say this, I had to repost it. I could not agree more.

Categories: Blog articles

Pacing

October 30, 2019 - 3:20am

Pacing in a VC fund context is how much capital the firm is investing in a given period and tracking that over time.

I don’t think a VC firm should manage to a pacing number. It should manage to the opportunity set that it sees.

But I think pacing is a great thing to track in the rearview mirror.

I like to look at investment pace by quarter and year. And by dollars and deals. And by new names and follow-ons.

If you keep track of that, chart it, and review it, you will be mindful of whether the firm is getting too far out over its skis or heels.

And that is a super useful thing to be aware of.

Categories: Blog articles

Recount Media

October 29, 2019 - 3:02am

This post is also live on USV.com as we announce all of our investments there with a blog post.

Eighteen months ago, I had breakfast with John Heilemann and he told me that his world, political media, was challenged in the shift from linear television (ie cable news) to real-time mobile (ie Twitter). He saw an opportunity to address that by filling the void in between them with news content that was made for real-time mobile consumption but had the journalistic integrity and production values of linear television.

I said to him “you should start a company to fill that void and you should get John Battelle to join you in starting that business.”

John did exactly that and six months later USV provided the seed capital along with True Ventures and a fantastic group of angel investors. 

Their company is called Recount Media and it has stayed largely under the radar for the last ten months as they built the team and started producing news content that promises “no bullshit, no bad faith, in five minutes or less.”

Having provided the initial funding for Twitter twelve years ago, we at USV are acutely aware that the disruption in media that it caused has been both positive and negative and that there is more work to do to make sure our society is well served by both the Fourth and Fifth estates.

We think that the work John, John and the dream team of journalists, producers, technologists, and business people are doing will make a material impact on filling the void and we are proud to be supportive investors in Recount Media.

If you want to see what Recount is all about you can download the Recount iOS app and/or sign up for their videos delivered via a daily email. You can also follow the Recount on TwitterInstagram, and YouTube.

Categories: Blog articles

What You Do Is Who You Are

October 28, 2019 - 1:56am

This past summer I read a proof of Ben Horowitz’s new book, What You Do Is Who You Are, and I even blogged about it here without naming the book.

What You Do is about culture, how you make it, how you keep it, and how the big decisions you make and how you explain them set the culture in your organization.

To explain this Ben tells the story of four different cultures that were set by strong leaders:

– the leader of the only successful slave revolt, Haiti’s Toussaint Louverture

– the Samurai, who ruled Japan for seven hundred years and shaped modern Japanese culture

– Genghis Khan, who built the world’s largest empire

– Shaka Senghor, a man convicted of murder who ran the most formidable prison gang in the yard and ultimately transformed prison culture.

https://www.amazon.com/What-You-Do-Who-Are/dp/0062871331/

These stories really make it clear how you set and keep your culture. You will come away from this book with a clear understanding of how your actions will set the culture in your company.

I read Ben’s interview with Connie Loizos and I like what he said here about why he wrote the book:

First, it was the thing that I had the most difficult time with as a CEO. People would say, ‘Ben, pay attention to culture, it really is the key.’ But when you were like, ‘Okay, great, how do i do that?’ it was like, ‘Um, maybe you should have a meeting about it.’ Nobody could convey: what it was, how you dealt with it, how you designed it. So I felt like I was missing a piece of my own education.
Also, when I look at the work I do now, it’s the most important thing. What I say to people at the firm is that nobody 10 or 20 or 30 years from now is going to remember what deals we’ve won or lost or what the returns were on this or that. You’re going to remember what it felt like to work here and to do business with us and what kind of imprint we put on the world. And that’s our culture. That’s our behavior. We can’t have any drift from that. And I think that’s true for every company.

So if you leading your company and you are thinking “ok, great, how do I do that?”, then go get this book and read it. I think you will come away with a much better understanding of what culture is all about.

Categories: Blog articles

Bringing It All Back Together

October 27, 2019 - 5:08am

Early-stage companies are exercises in experimentation, iteration, and figuring things out. You try one thing, it sort of works, but you see a tangential opportunity and go after that. Sometimes that leads to a full-on pivot, other times it leads to an evolution of the opportunity.

This process can create multiple products, services, projects, and it can look messy. I love it when founders bring it all back together into one cohesive package. That doesn’t always happen, but when it does, it is a thing of beauty.

That happened this week with our portfolio company Numerai. I saw this tweet by Numerai founder Richard Craib:

Big: as of today the @numerai tournament is now running on Erasure.

— Richard Craib
Categories: Blog articles

Audio Of The Week: A Conversation With Andrew McAfee

October 26, 2019 - 8:12am

This is a good interview. I learned a lot.

Categories: Blog articles

Funding Friday: Shapeshift

October 25, 2019 - 1:50am

Our portfolio company Kickstarter is running a cool crowdfunding event called Shapeshift that is focused on “bold new products made from recycled materials.”

You can see them here and back the ones that are interesting to you.

I did that this morning.

Here is one of the Shapeshift projects I backed:

Categories: Blog articles

Carbon Offsets

October 24, 2019 - 1:22pm

Business and personal travel, which we’ve been doing a lot of the last two weeks, is a big producer of carbon in the atmosphere. I’m actually writing this on a cross Atlantic flight.

But you can offset those carbon emissions fairly inexpensively

There are a number of services on the Internet that will help you do it.

Over the last four years the Gotham Gal and I have racked up about 570 tons of carbon via air travel.

Depending on how much we spend per ton to offset it, the coast could be as low as $10,000 or as high as $60,000.

At $10,000, that is about a 3% increase to our air travel costs. At $60,000, that is about a 20% increase to our air travel costs.

There are a lot of debates about how much it should cost to offset a ton of carbon. Right now it is inexpensive because the supply of offset projects is higher than the demand for them.

But at market equilibrium, the price should be a lot higher and many people offset at the theoretical market equilibrium price not the current market price.

I don’t think there is a right or wrong answer to this question about how much per ton you should pay for offsets. It depends on how you think about it.

Our flight today could cost as little as $100 to offset for both of us. Or as much as $600.

Either way, we are paying to reduce our carbon footprint and that is a good thing in our view.

If everyone started doing this, it would transform the carbon offset markets and lead to a lot of great projects, like reforestation and other approaches that would have a meaningful contribution to reducing the amount of carbon in the atmosphere.

Categories: Blog articles