Posts from June 2017

Funding Friday: Kickstarter Gold

Our portfolio company Kickstarter launched something cool a couple weeks ago. It is called Kickstarter Gold:

From June 20 through July 31, we’re spotlighting new projects by exciting artists and makers who use Kickstarter to sustain their creative independence.

Why? Because repeat creators are an integral part of the Kickstarter ecosystem. In fact, a third of all pledges to successful projects —over $1 billion since 2009 — go toward projects by creators who have run two, three, four, or even 100+ projects.

We selected Kickstarter Gold creators for their creativity, ingenuity, and success using the platform. They’ll be making new works inspired by their past projects, so backers can discover extra-amazing ideas, plus special rewards that aren’t available anywhere else.

Here are the projects. I just backed a bunch of them. It’s Funding Friday so maybe you might want to do the same.

Flip

Last year our niece decided to move about half way through her lease and ended up having to Airbnb her apartment for six months until she got out of her lease.

This summer our daughter is at graduate school upstate and rented her apartment to her friend for the summer.

One of our analysts decided to move to Brooklyn and had to figure out what to do with her apartment in Manhattan.

This is how millennials live. They go from apartment to apartment, roommate to roommate, city to city, job to job.

But this is not how apartments are rented. The apartments are leased for one year, two years, three years, with upfront security deposits, brokers fees, and a bunch of other costs that make the “fluid” approach to living difficult.

Enter Flip.

Flip is “the easiest way to sublet or get out of your lease and it is 100% free to list”

So if you or someone you know is looking to move and wants help with a sublet or needs to get out of a lease, Flip is the place to go.

The Gotham Gal has been an investor in Flip since the very beginning. I have been watching the company grow and build out this market opportunity with interest.

Earlier this year, she introduced the Flip founders to my partner Andy and the result is that USV is now also an investor in Flip.

Andy explained why USV is so interested in Flip on the USV blog a couple of days ago.

It’s a great post and you should go read it, but my favorite part of the post is this word cloud, taken from Flip’s listings, that explains why people use Flip:

Finally, Flip is looking to hire some engineers. They have built everything with just four people. That’s bootstrapping. I love it. They plan to double the team to eight people with this new investment. So if you want to work with great people, building technology that helps people with important changes in their life, Flip would be the place to do both of those things.

Bearing Witness

Yesterday afternoon I spent a couple hours sitting on the stage at the high school graduation ceremony for the Academy For Software Engineering.

This evening I will spend another couple hours sitting on the stage at the high school graduation ceremony for the Bronx Academy For Software Engineering.

Both yesterday and today are busy days with lots of work obligations, board meetings, decisions, and family time.

But these four hours are the most important hours I will spend this week.

About two hundred young adults will graduate from these two NYC public high schools over this two day period.

These are young adults who made the decision four years ago to take a risk on two brand new high schools with no track record and no reputation.

But this week they are walking off the stage with a high school diploma and a set of skills in extremely high demand in today’s economy.

They also know how to talk to machines, tell them what to do, and make them work for them.

I am proud of these roughly two hundred young adults and I am pleased to bear witness to their accomplishments and the very bright futures that they all have in front of them.

Putting Harassment On The Table Vs Under The Table

A lot has been written in the last week about the way the tech sector treats sexual harassment and a lot of suggestions have been made.

I am particularly enthusiastic about what our fomer USV colleague Brittany Laughlin suggests, which is putting the entire issue on the table, talking about it regularly in the workplace, discussing specific situations as a group, and avoiding the urge to come to quick conclusions.

There is so much good sense in her blog post and I would urge you all to go read it.

The Selloff

My oldest daughter Jessica send me a message last night “what’s going on with Ethereum?”. I told her it was a selloff. I said that people who had made a ton of money in the run up over the last six months were taking profits and I thought it could go on for a while. She said she was going to buy some more. I told her that was fine, but if I was going to buy, I would buy a little bit every week and not a whole bunch right now. As I have said on this blog so many times, I am a fan of dollar cost averaging and building a position over time, sometimes a long time.

I have been buying Bitcoin since early 2013 and Ethereum since last year. I keep buying but never that much at one time. Just a little bit every week. You can build a pretty big position that way, but you have to be patient and you have to keep at it.

Doing it that way takes a lot of the ups and downs out of the equation. I don’t try to time market bottoms and market tops, even though I can sense when they are happening. I don’t try to predict where these assets are going in the near term and I just believe they will be a lot more valuable in five or ten years than they are now. That’s good enough for me.

The other thing I believe in is asset allocation. I’ve told a lot of young people, including my children, that having 10-20% of your net worth in crypto might make sense. But not 100%. The category is too volatile and you could lose a lot if you aren’t careful. Having a reasonable asset allocation across all asset categories; cash, stocks, bonds, real estate, venture capital, crypto, etc is what I recommend and what we do. It might not be as exciting but it lets you sleep at night.

So, my gut says we are headed for a selloff in the crypto sector. But of course, I could be wrong about that. I am wrong a lot. But honestly, I don’t really care. I will keep buying into this correction or rally, whatever it turns out to be. Because the more important question is where these assets will be in five or ten years. And I have a lot more conviction about that one.

Doing The Heavy Lifting

Most venture capital investments are made, over time, by syndicates. This means a group of venture capital firms develops around a company, usually built over multiples rounds. Some of the firms in the syndicate agree to (or require) having a partner from their firm join the Board of the company.

If you look at the roughly dozen boards I am on, most of them have multiple venture capitalists on them. Some also have independent directors, something I believe strongly in and have written about frequently.

Not all venture capital firms in your syndicate will be the same. Not all of the VCs on your board will be the same. Some will be challenging to deal with. Some will be unproductive and distracting. Some will be nice to have around but won’t do much. A few will roll up the sleeves and do the “heavy lifting.”

It is this latter group that is super valuable. You saw it in action last week when the partners of Benchmark apparently negotiated a change in leadership at Uber. That is hard, painful work. But someone has to do it. And I have seen the partners at Benchmark do it before. They don’t shy from the tough stuff. Nobody enjoys doing things like that, but they know when it is needed and they step up and do it.

I was talking to another VC I work with yesterday about a completely different situation. The company is doing great. We have some important decisions in front of us, all good choices to have to make, but selecting the right ones will matter a lot. This VC has been deeply engaged in the process, providing a lot of super valuable advice, and saying things that need to be said, even if they are not popular. I feel incredibly lucky to have someone like that in a syndicate with me. And I told him that yesterday.

You can put together a list of the top VCs by returns. That is done annually. It’s all nonsense. There are a ton of shitty VCs on that list. Returns matter, for sure. But what really matters is who shows up when the hard conversation has to be had. What really matters is who provides the right advice at a critical time. What really matters is who puts aside their own personal interests and does what is in the best interests of the company. What really matters is who steps into a vacuum and provides leadership when it is badly needed.

When you are picking investors, you should call around and check references. Ask about this stuff. Find out who does the heavy lifting and who goes along for the ride. Pick the one who does the heavy lifting. Because you will need it, frequently.

Fun Friday: Let’s Play GM

So you are Phil Jackson and you’ve got the eighth pick in yesterday’s NBA Draft. 

You want a guard who can be a franchise player for the Knicks.

You can take Malik Monk, Dennis Smith Jr, or Frank Ntilikina.

Who do you pick?

I don’t know much about Frank Ntilikina. I sure hope he lives up to whatever Phil Jackson saw in him. 

But I fell in love with Malik Monk’s game in the NCAA tournament. He’d have been my pick.

Numeraire Is Live

Back in February, I posted about Numeraire.

I wrote:

the Numerai team has now gone a step further and issued a crypto-token called Numeraire to incent these data scientists to work together to build the best models instead of just competing with each other

And roughy four months later, I am happy to write that the Numeraire token is live on the Ethereum blockchain.

You can read more about this here.

Well done Numerai team.

Open Source Funding Documents

Cooley, one of the top startup law firms, has open sourced the legal documents required to do a Series Seed or Convertible Note financing.

They are available on Cooley’s CooleyGo document generation platform and also on GitHub.

Kudos to Cooley for doing this. We need to make the transaction costs of getting a financing done as low as possible and putting the legal docs into the public domain is a great step forward in doing that.