Posts from Uncategorized


TPP stands for Trans Pacific Partnership, a far reaching free trade deal that US and our Asian trading partners have been working on for years. The TPP was in the news yesterday because Hillary Clinton came out and said that, in its current form, she cannot support TPP. You can read her reasons for taking this stance.

You would think as a free trade loving, free market loving venture capitalist I would be a huge proponent of TPP. But I am not.

I am very concerned about the copyright provisions in TPP which feel very much in the old world model of intellectual property protection and which would make it hard for the US government to evolve copyright laws in an era of digital content, more open innovation, and remix culture.

The EFF has a great discussion of these issues on its website so instead of reciting them here, you can read a detailed discussion of the copyright issues in TPP here.

One of the problems with these big multi-national trade negotiations is that it is super hard to get everyone to agree on everything in them. That is why they are negotiated in secret and the end result is then voted yes or no in each country without any amendments.

I realize that perfect is the enemy of the good and you need to have a comprehensive view of a trade bill like this and not focus on one issue. But copyright law is a big deal for the innovation economy and if I were in Congress, I would be seriously thinking about voting no on TPP.

Kickstarter, PBC

I recall meeting Perry Chen for the first time in the old USV offices on the 14th floor back in 2009 shortly after Kickstarter launched. He and his partners Yancey and Charles were onto something, I was sure of that. But they wanted to do things differently. He told me that Kickstarter always wanted to do what they felt was the right thing. He told me they were not building the company to be sold. And so, he said, they needed investors who understood that and appreciated it. I told him that approach was welcome at USV and that we were eager to figure out if there was another way to do things too.

Six years later, Kickstarter has formalized those desires and commitments into its corporate charter and in the process has reincorporated a Public Benefit Corporation (PBC) under Delaware law.  A Benefit Corporation is different than a “B Corp” because it involves formally amending the company’s charter and being recognized as such under the law.

I encourage you to read their new charter as it outlines the things they will hold as dear as shareholder value and be held accountable to and report on annually. And you should also read their interview with the New York Times where they explain why they did this.

There are those who say that Benefit Corporations and venture capital are not compatible. We don’t agree and we think companies that align their values with their customers and communities will benefit over the long term, not suffer. And that alignment can produce value for shareholders sustainably and profitably. It is worth noting that not one of Kickstarter’s angel investors, venture investors, employees, and board members who own shares in Kickstarter dissented on the vote to convert to a PBC.

None of this should suggest to you or anyone that Kickstarter is not a for-profit business. It has made money since its second year of operation. Profits give it sustainability without the need to finance the business externally. And profits can enrich its founders, employees, and investors. But these profits are not the only goal of Kickstarter. The company exists to bring creative projects to life and that mission drives the company as much, or more, than the profit seeking motive.  

My partner Albert has written a lot about Benefit Corporations and has worked with the State of Delaware to ensure that their statutes are workable for entrepreneurs and the investors who support them. USV is a fan of Benefit Corporations and we are thrilled that Kickstarter has successfully converted into one and codified their values and commitments for the long-term as a Benefit Corporation.

Ten Years Of Techmeme

If you were blogging about tech in September 2005 when launched, you knew about it and you read it. There was a time when AVC posts would regularly be on Techmeme and AVC would regularly be on its leaderboard. That has not been the case for years but I still read Techmeme every day. It is as valuable a source of news for me as anything else.

Gabe wrote a short post about Techmeme yesterday on its 10th anniversary. There are few things in there that I’d like to react to.

  1. Techmeme’s original goals were to “1. Recognize the web as editor, 2. Rapidly uncover new sources, and 3. Relate the conversation.” These are awesome goals and made the site what it was and what it is. Techmeme does a better job at number 3 than anything out there, ten years after showing the world how it is done. Sadly they do not do a particularly good job at number 2 and have not for years. Gabe tacitly acknowledges this with this bit “However, as Techmeme became the first stop for tech news for a growing and influential segment of the tech industry, other goals became imperative too. In particular: strive for comprehensive coverage of the day’s most significant tech stories, and post big, breaking news story quickly.” I can get the “big breaking news” anywhere and don’t value Techmeme for that. But I understand that others do and frankly Techmeme can and should do whatever they think makes for the best site for the largest audience. But I do miss the time when solo bloggers made up most of the links. Those kind of voices are still out there and there really isn’t a great way to find them unless they are software engineers whose links show up on Hacker News.
  2. Techmeme survived each and every effort to supplant it. Gabe writes this “Later the phrase “Techmeme Killer” would appear fairly regularlyin headlines, most notably when Google itself introduced a would-be “Techmeme Killer”. Even after Techmeme survived Google’s Techmeme-killer, services like ePlatform and TechFuga would still elicit comparisons to Techmeme, while TechCrunch would later say of Tweetmeme, a Techmeme-like aggregator of tweets “If I were Gabe Rivera, I’d start worrying now”.” I’ve ranted on this before but nothing annoys more than the “xyz killer” headline. The fact is that that supplanting a category creator and market leader is not easy, as much as the media would suggest that it is, and Gabe and his team have done a terrific job of continuing to produce a great site day after day, year after year.
  3. Techmeme has never taken outside investment, allowing them to run the business as a “cashflow business” that creates a good living for the team. Gabe says this “I always hoped it would be possible to build and sustain Techmeme without the aid of venture capital or debt. Not so much because of real or perceived issues around independence or autonomy, not because “bootstrapped” is an impressive badge of honor, and not because I disliked investors (some of my best friends are VCs!) But rather because the media business we envisioned by its nature was just not destined to become the “unicorn” VCs always want, at least in its first of several possible iterations. So proving sustainability always seemed necessarily part of the plan. Moreover, in casual conversations with investors over the years most ideas for expansion suggested to me seemed destined to fail in my estimation (a fate borne out in a few cases by actual companies that carried out such plans).” Most businesses, including many that do raise VC including some we have invested in, should not raise VC. Kudos to Gabe for understanding that and financing his business another way (revenues).

Techmeme is an “internet treasure” to use the phrase my friend Mark taught me. I visit it every day. So do most of the leaders of the tech sector. It’s a fantastic resource and it’s been a pleasure to watch Gabe and his team build it into what it is over the years. Happy 10th anniversary Techmeme.

Some Thoughts On Labor On Labor Day

When one looks back over the history of the development of the modern economy from the agricultural age, to the industrial age, to the information age, the development of a strong labor movement has to be one of the signature events. Capitalism, taken to its excesses, does not allocate economic value fairly to all participants in the economic system. The workers, slaving away to build the railroad, the skyscraper, etc, provide real and substantial value to the overall system and yet, because they are commodified and interchangeable parts, they don’t always get their fair share of the economic value they help to create. So the labor movement provides the market power that each worker individually cannot provide.

The emergence of the middle class in the developed world in the 19th and 20th centuries has as much to do with the emergence of a labor movement as it has to do with anything. And a growing middle class in turn drove economic development as the obtained earning power was spent on needs like homes, cars, education, etc.

I am a fan of the idea that labor needs a mechanism to obtain market power as a counterbalance to the excesses of markets and capitalism. I think we can look back and see all the good that has come from a strong labor movement in the US over the past 150 years.

However, like all bureaucratic institutions, the “Union” mechanism appears anachronistic sitting here in the second decade of the 21st century. We are witnessing the sustained unwinding of 19th and 20th century institutions that were built at a time when transaction and communications costs were high and the overhead of bureaucracy and institutional inertia were costs that were unavoidable.

One has to think “if I were constructing a labor movement from scratch in 2015, how would I do it?”  My colleague Nick Grossman coined the term “Union 2.0” inside our firm to talk about all the organizing tools coming to market to assist workers in the “gig economy.” But I think Union 2.0 is way bigger than the gig economy. The NY Times has a piece today on workers in a carwash in Santa Fe organizing outside of the traditional union system. One can imagine leveraging technology, communications, and marketplaces to allow such a thing on a much larger scale.

I don’t know how much the traditional union system taxes workers to provide the market power they need. But if its like any other hierarchical system that we are seeing replaced by networks and markets, the take rates are in the 20-40% range and could be lowered to sub 5% with technology.

That’s a big deal. And I suspect we will see just that happen in my lifetime. I sure hope so.

Video Of The Week: The Walkoff Homer

I apologize if you came here looking for the business/tech section and landed on the sports section. But that’s how its going to be today.

I grew up an army brat moving every year. I was a baseball fan and my teams were the A’s and the Pirates, the two most colorful teams in baseball in the 70s. When we arrived in NYC in 1983, I had two choices, the Mets and the Yankees. There was no way I was going to be a Yankees fan, so the Mets were the default choice but not one I was excited about.

A year later in the summer of 1984, I arrived back in NYC from a business trip on a steamy July night, just like this week has been, and got in a taxi at LaGuardia. Back then the taxis did not have AC so we drove into Manhattan with the windows down and the breeze in our faces. The taxi driver had the Mets game crackling on the radio, the best way to consume baseball in my opinion. The Mets had their young rookie pitcher Dwight Gooden on the mound and it was late in the game and he was striking out everyone. It was mesmerizing to listen to this kid strike out batter after batter. I got home, turned on the game in our apartment, watched the end of it, and have been a dedicated Met fan ever since.

The early years of my Met-fandom were easy. The 80s were a great time to be a Met fan. The rest of my time in NYC no so much.

But this year has been different. The Mets have pitching, lots of it. And so I’ve been watching more closely all summer long.

Last night, after dinner and after our guests retired for the night, Josh and I turned on the Mets Nationals game. Matt Harvey was in fine form and, as usual, the Mets were not hitting. Harvey stayed in an inning too long, lost the lead, and the game went into extra innings. Finally, in the 12th inning, Wilmer Flores hit this walk off homer and the Mets are now two games out of first place with Yoenis Cespedes on a plane to NYC. I think we’ll be watching a lot of Mets games the rest of this season.

Bitcoin Trends In The First Half of 2015

Our portfolio company Coinbase published a “Bitcoin Trends” blog post yesterday. It’s a quick and interesting read.

Here are my two favorite charts from it:

I’ve said this before and I will say it again, the exchange price of Bitcoin is not the most important number to look at. The things to look at are transaction volume on the network and developer adoption. On these two metrics, Bitcoin seems to be doing quite well.

Fun Friday: Summer Reading List

It’s the dog days of summer. The Gotham Gal and I spend our weekends at our beach house and I read a lot more.

Right now I am reading Dead Wake, Erik Larson’s story of the Lusitania’s last voyage.

I’m interested in what the AVC community is reading this summer.

So let’s crowdsource a summer reading list in the comments today.

Access Code

Access Code is a free 9 month mobile development program, which enables talented adults from low-income and underrepresented communities to learn iOS or Android and get jobs in the NYC tech economy. This program raises the average income of graduates from less than $26,000 a year to $73,000 a year, and brings them from the poverty line to the middle class in the process. Access Code was developed by Coalition For Queens (C4Q).

I believe that people from every community and background should have the opportunity to learn to code, gain jobs in tech, and pursue entrepreneurship. By working deeply within local communities to identify talent, C4Q is creating a tech community that is representative of the diversity of New York, with cohorts that are over 50% women, 60% African-American or Hispanic, and 50% immigrants. Furthermore, they serve the 65% of New Yorkers who don’t have a college education. If you never graduate from college in New York City, your average lifetime income is $27,000 a year. C4Q rigorously selects the top 5% of applicants, and opens new career opportunities in tech and entrepreneurship for them. There are graduates who are former administrative assistants who have now become mobile developers at companies such as Buzzfeed and an Egyptian immigrant raised in Queensbridge Public Housing has graduated from Y Combinator and raised venture capital.

The New York community is generously contributing time, skills, and funding to these efforts to expand opportunity for others. C4Q is able to provide these programs with the support of leaders in technology, business, and philanthropy such as the Robin Hood Foundation, Blackstone, and Google. Many leaders in the New York iOS and Android community are involved with curriculum, teaching, and mentoring — including Otra Therox and Ash Farrow of CocoaPods and, Brian Donohue, the CEO of Instapaper, as well as Kevin Galligan of Touch Lab, organizer of DroidCon NY and the NY Android Developer meetup.

In our recent Techcrunch Disrupt interview, I spoke about the need for the tech community to be civically engaged and the importance of expanding access to education. Many organizations are solving this problem by teaching coding in schools and increasing the K-12 STEM education pipeline. Providing coding training to underserved adults who can fill tech jobs, as Access Code is doing, is another part of the talent equation that can make significant immediate impact. If you feel like you can support this effort with your time or your money or by hiring Access Code graduates or by teaching a class, please do so.