Posts from March 2014

The Value Of An Engineering Degree

Six years ago, in the summer of 2008, NYU and Polytechnic University came together to create NYU Poly, NYU’s engineering school in downtown Brooklyn. When I saw the news, I called NYU President John Sexton and asked for a meeting. He agreed and I went down to Washington Square to meet with him. I told him he had just acquired a jewel, but a jewel that had fallen on hard times. I told him he needed to invest in bringing that jewel back to it’s former luster and that if he did, it would be an incredible thing for NYU, for Poly, for Brooklyn, and for NYC. In typical John Sexton fashion, he got up, gave me a big smile and a big hug, and said “I will do it but I need your help”. And that is how I found myself on the board of NYU Poly and NYU.

Here’s the thing I know. Engineering schools and engineering degrees are the most valuable degrees you can issue in higher ed. Here is the data:

20 year ROI on education

You might be surprised to see Stevens Institute and NYU Poly on that list. But I am not. NYC is starved for the kind of technical, quantitative, and analytical minds that engineering schools generate. Combine a big urban center with a top engineering school and you have a recipe to print money. And you have a recipe to change lives. Many of the kids who go to NYU Poly are from immigrant families and are graduates of the NYC public school system. They are smart and work hard. And with an engineering degree and a big city like NYC, they can earn more in a year than their parents earn combined.

The value of a diploma is set by the marketplace, by the laws of supply and demand. There are more technical jobs open than qualified candidates to fill them. It is the one bright spot in an otherwise bleak employment picture. We need to be investing in our engineering schools and we need to be investing in a K-12 education that gets our children ready to go to these schools.

When I am not working at USV and/or hanging out with friends and family, I am working on this problem. It is an important one. I plan to post more on this topic in the coming weeks. I have been looking at enrollment data and we are seeing some really interesting things. It is very encouraging and exciting to me.

The FIRST Robotics Competition

While many will be focused on the final four next weekend, the Gotham Gal and I plan to attend another competition, the NYC FIRST Robotics Competition at the Javits Center in NYC.

robotics competition

FIRST is a global robotics program with a number of competitions. Next weekend is the NYC competition and the winning teams will go on to the global competition in late April in St Louis.

The competition will go on for three days next weekend in NYC and attendance is completely free. Details are as follows:

April 4-6, 2014 – 9:00 a.m. – 4:30 p.m.
Jacob Javits Convention Center
655 West 34th St., New York, NY 10001
THIS EVENT IS FREE AND OPEN TO THE PUBLIC
Download Full Program Agenda and Layout

We plan to attend saturday afternoon. I’ve never been to one of these and am looking forward to it.

Video Of The Week: Value For Many

Praveen sent me this TED talk by R.A. Mashelkar from TED India 2009. I just watched it and I agree with Praveen that its an important talk and an important concept. The video is, in typical TED fashion, only 20 minutes long.

Fun Friday: Which web or mobile services most inspire you?

It’s time for another community powered day at AVC. Someone, I can’t recall who, suggested this to me. One of the two questions we ask people who are applying for our analyst position at USV is “Which web or mobile services most inspire you?”.

So let’s discuss that question here at AVC today.

For me, it is always those services that allow for emergent behavior, like this woman Anna Todd writing a serialized novel, to date 278 chapters long, called After that has more than a million readers. Or a 19 year old young man raising almost $2.5mm to make virtual reality goggles. Or designing an incredible 3D maze that can be 3D printed and purchased by anyone. These are the kind of services that inspire me.

How about you?

A Founder’s Notebook

One of my favorite things to do on the Internet is curate. I do that on my tumblr and also at usv.com. I find good stuff around the Internet and I grab it and share it with others.

So when I see others doing a great job with curating, I like to acknowledge it and point others to it. And that’s the subject of today’s post. David Jackson is the founder of Seeking Alpha, a community of stock market investors. He’s been curating management advice from around the Internet on a blog called A Founder’s Notebook for a while now. It’s really good.

My only complaint is that its not on Tumblr, where it would be an instant and easy follow. It takes more work to follow a blog when its on the open Internet (when you don’t use RSS. i don’t). However, there is a subscribe via email option on the right sidebar which is how I get his updates.

Anyway, if you are a  founder and like reading advice from around the web on management, product, and strategy, I recommend A Founder’s Notebook. It’s really well done.

The Search For The Next Platform

I found this part of Mark Zuckerberg’s post on the Oculus acquisition most revealing:

We have a lot more to do on mobile, but at this point we feel we’re in a position where we can start focusing on what platforms will come next to enable even more useful, entertaining and personal experiences.

Facebook was a bit slow to get aboard the mobile train. Unlike Apple and Google, they do not have a mobile OS. And they were slow to evolve the core Facebook experience from web to mobile. But once they got religion about it, they moved very quickly to do that and now have an excellent mobile experience on both iOS and Android. And with Instagram and WhatsApp, they have three of the top ten third party mobile apps globally (Facebook, WhatsApp, Instagram). So they have gotten to a good place on mobile (and that’s what the $19bn WhatsApp buy was all about).

And now Zuck and his team are looking up and saying “what’s next?”. It’s not that different from what Larry Page and his team are doing at Google. The Charlie Rose interview with Larry that I made Video Of The Week last weekend was a bit of a review of all the things Google is doing to figure out what’s next (balloons, driverless cars, Nest, DeepMind, etc).

If you look at these big acquisitions like Nest and Oculus, you might scratch your head. What does a Apple-style proprietary closed thermostat have in common with Google’s mobile strategy? What does a Virtual Reality headset have to do with Facebook’s social graph? Nothing in both cases.

But the roadmap has been clear for the past seven years (maybe longer). The next thing was mobile. Mobile is now the last thing. And all of these big tech companies are looking for the next thing to make sure they don’t miss it.. And they will pay real money (to you and me) for a call option on the next thing.

It isn’t clear if the next thing is virtual reality, the internet of things, drones, machine learning, or something else. Larry doesn’t know. Zuck doesn’t know. I don’t know. But the race is on to figure it out. Trillions of dollars of collective market capitalizations are on the line. So a couple billion here or there is chump change. Except for the people who collect that chump change for selling them an option on the next thing. It’s real money to us.

So for the next few years (I have no idea how long this search for what’s next will go on), a game to be playing is building a platform that can plausibly be the next big thing. It’s a risky game. But the payoff can be large. And you can even start by crowdfunding your first round. Man I love this business.

AVC Downtime?

I’ve been hearing reports of AVC being down here and there over the past few days. I’d like to ask a few questions of the regulars.

1) Have you experienced downtime/unavailability on AVC since the cutover from typepad to wordpress?

2) if so, can you recall the error mode? was it a cloudflare error page? was it a 404 page? was it something else?

3) how frequently does this happen?

Finally if you experience this issue going forward, I would love a screenshot of the error page. You can email it to me via the contact link at the bottom of the About page.

Thanks everyone. I am trying to make AVC as reliable as it can be and downtime is something I want to get to the bottom of.

Ageism

There has been a lot of chatter recently about ageism and the old vs young debate in tech. The New Republic has a post up today on the topic. And last week the New York Times Magazine featured a long article on the topic.

There is no doubt that tech is a young person’s game to some extent. And there is no doubt that VCs are biased towards younger founders and against older ones.

However, it’s not an absolute thing. I’ve written about this before here at AVC. At USV, we have backed founders in their teens, 20s, 30s, 40s, and 50s. I think we would back a founder in her 60s or 70s too but we have not yet had that opportunity in an investment that made sense to us. The Gotham Gal recently backed a founder in his late 60s. I am pretty sure that will be a good bet.

I saw this graphic on Tumblr today. It made me happy. Ray Kroc started McDonalds when he was my age (52).

founders over 35

 

My point is this. Yes tech is biased toward younger people. To some extent, USV may be biased in that direction. We have not done a distribution of the ages of the founders we have backed but I suspect it would weight a bit toward the younger ages. My bet is that the median age of the founders we have backed would be mid 30s.

But as this graphic shows, you are never too old to start a company. And I promise you that USV will consider any investment in our sweet spot (large software based networks) regardless of the age of the founder. Age is a two way street. Youth brings some positives. But age brings experience. And that is a pretty valuable thing.

The USV MBA

Since starting USV in 2004 (we actually started USV in the summer of 2003, but it took Brad and I over a year to raise our first fund), we have had a two year analyst position. The idea is we bring in a young talented person early on in their career, they learn a lot about the startup world from inside a VC firm, and we get leverage from having a person who can do a lot of the support work that the partners need to do our jobs. The job gets stale after a few years and since we don’t have a career path at USV, they leave after a couple years.

It has worked out well. Our first analyst Charlie O’Donnell, has gone on to do a number of things and now runs his own seed fund, Brooklyn Bridge Ventures. Our second analyst, Andrew Parker, is now a partner at Spark Capital in Boston. Our third analyst, Eric Friedman, is now Director of Sales and Revenue Operations at our portfolio company Foursquare. Christina Cacioppo came next and she has been working on her own startup since leaving USV eighteen months ago. Here’s her online profile if you want to see what she’s been up to. Zander and Brian are still with us, but will be moving on this year as their two year stints are coming to an end. These two young men are super talented and if you are interested in hiring the very best into your company, you should reach out to them. Tweeting at them should work (I linked to their twitters above).

I like to think of this two year stint as the USV MBA. We don’t issue diplomas but we pay salaries instead of charging tuition. You learn similar things but the cases are real time, not after the fact. And I would assert with a fair amount of pride that a USV Analyst stint on your resume is worth as much as a top tier MBA, maybe more. And the alumni network, while small, is fantastic.

All of that is to provide the setup to the news that we are hiring for our next two year analyst. Zander blogged about it last week and it’s been highlighted at the top of usv.com for the past week, so many of you probably already know about this. But there is only one more week to apply as applications are due by April 1st at 11:59pm eastern time. So I thought I’d make sure everyone who reads AVC knows about this position.

The application is pretty simple. You give us some links to your online presence, you answer two questions over a video interview app called Ziggeo (which is my partner Albert’s wife Susan’s startup), and you hit submit. We take it from there. We look at the links and the videos and select a bunch of people for in person interviews. We hope to have the position filled by the end of April/early May.

If you want to apply, go read Zander’s post and the detailed instructions are at the end of the post. If you are like me and like to skip the instructions and just get on with it, the application page on usv.com is here.