Posts from 2013

It's A Wrap

The Gotham Gal ends 2013 looking into the future and thinking about how her porfolio companies will grow next year. I am similarly minded as we wrap 2013. I am excited about 2014, and in particular the big opportunities that await many of our portfolio companies. 

I/we have a view about what is coming and I tried to lay that out at LeWeb earlier this month. We continue to look for investments in companies that fit into that view of the world.

But for me, it is the development of the companies we have already invested in that is always the most interesting work. And there are a bunch of them that are poised to have very big years in 2014 so that is what I woke up thinking about today and what I am most excited about professionally.

I am also very happy to have finally wound down Flatiron Partners, our previous venture capital firm, in 2013. My partners and I continue to hold interests in a few of our remaining portfolio companies but the business of Flatiron Partners has been wound down, 17 years after we started it, and that is a great relief to me personally. 

Like the Gotham Gal, I am also thinking about our impending empty nest status. This is something the two of us have been thinking about and to some extent planning for since 2007. Raising our family has been front and center for us for almost 25 years now and that phase is coming to an end in 2014. This means we can travel more, work more and less at the same time, and be more opportunistic about our lifestyle. I am looking forward to that.

We are spending New Years in Mexico then flying back to NYC tomorrow to start 2014. I am refreshed, relaxed, and ready for 2014.

#Blogging On The Road


Benedict Evans wrote a post about his traffic recently and I am proud that AVC is one of his top ten referrers. That inspired me to post some traffic data here today.

I've had google analytics on this blog since Oct 2005 and here's what the monthly traffic has looked like since then:

Monthly traffic since 2005

I feel like the AVC audince has been stable (or flat) since 2010. The peak in the middle of 2011 was from stumbleupon which was for some reason sending a boatload of traffic here for a while. That has since gone away and we are generally at about 250,000 visits per month. The UV chart looks almost identical to visits except it's about 175,000 UVs per month vs 250,000 visits.

Here are the top ten countries where AVC readers reside:

Avc audience location

And here are the top ten sources of traffic (actually eight because twitter appears twice and number ten is this blog)

Avc top ten referrers


Girls Who Code

I feel badly for Paul Graham because he's being made out to be something I am sure he is not. But the brouhaha that he unleashed about women founders, women coders, and women hackers is a good thing because we ought to be having a broader conversation about these issues.

Paul asks "God knows what you would do to get 13 year old girls interested in computers?" and that is a damn good question and one that I have been thinking about a lot over the past four years. We see very few women entrepreneurs walk into USV and that is disappointing to me. And I agree with Paul that one of the issues (but by no means the only issue) causing this gap, is that young women are not embracing tech in the key development years in middle school and early high school.

At The Academy For Software Engineering (AFSE), we use a "limited unscreened" model to accept students. It's limited because you have to attend an open house and make AFSE your first choice, but once you do those two things, its a lottery system to get in. So effectively the distributiion of students admitted is going to be very similar to the distribution of students who apply and make the school their first choice. In our first year, we admitted 24% young women. In our second year, the percentage was less, I believe below 20%. This is very upsetting to me and we are working on a number of things to change this. It will require working hard on the parents of the young women and the middle school guidance counselors. There is a lot of systemic bias in the system against young women taking this kind of direction with their studies and their career. And we must change that bias and it must be changed at the middle school level.

However, the young women who enroll at AFSE are incredible. I have spent a fair bit of time with them and I can tell you that they work hard, study, take school seriously, and can code as well as the boys. Last week I got to hand out the awards at the first ever AFSE hackathon. The winning team were all freshman, two girls and one boy. These girls were good, really good. I was super impressed.

Afse hackathon winners

So it can happen, it should happen, and if we make the effort, it will happen. 

There are a number of important initiatives under way to try to change things. The title of this post refers to one of them, Girls Who Code, which is a summer program in NYC and SF and now adding after school programs for young women to learn to code. There is also Black Girls Code, solving an even more difficult and important problem. And programs like TEALS and which are bringing CS education to the broader public school landscape will certainly help get more girls into coding too.

Taylor Rose, who is a young woman studying at MIT, wrote a good post about all of this and more yesterday. I think she sums up the situation as well as anything I've read.

There are efforts underway to attempt to close the gap between women and men studying CS. And it can be done. Harvey Mudd now enrolls as many women CS majors as male CS majors. Here's a ten minute video that talks about how they did that:

So as Taylor suggests in her post, instead of turning Paul's comments into a blogosphere shitstorm, maybe we would all be better off staring the issue in the face and thinking about how each of us could help make a difference on this issue. It's an important one and I am glad we are talking about it.

#hacking education#VC & Technology

Video of the Week: Bruce Schneier and Eben Moglen

By any measure, 2013 will go down as the year we all saw the dark side of the Internet revolution, courtesy of Edward Snowden. So I think it’s fitting to showcase Eben Moglen’s conversation with Bruce Schneier as the final video of the week of 2013. This is long (90mins) but worth watching. Eben and Bruce are two of the leading intellectuals on the important subjects of trust, identity, privacy, and the Internet.


The Purity Of Angel Investing

Though I have made a few angel investments here and there over the years, it has never been my primary approach to investing in startups. I joined a venture capital firm when I was 25 years old and have been working at a venture capital firm ever since. I grew up in the business of investing other people's money and that is how I have gone about investing in startups ever since.

Over the past five years, I have watched The Gotham Gal build a portfolio of angel investments. She has invested in almost fifty companies in the past five years and if you include things like restaurants and retail establishments, that number grows to closer to sixty five. She is investing our capital but these are her investments. 

As I watch her select her investments and then work with them, I am impressed with the purity of intent that comes with being an angel investor. She invests in people she has confidence in and she invests in businesses that make sense to her. When she engages with her investments, she is giving her advice.

Compare and contrast that with a venture capital firm. A venture capital firm is in business to make money for its investors. They must invest in things that they believe will make money and they must be able to rationalize and explain their investments and their investment strategy. A venture capital firm has multiple partners and its investment decisions are based on the consensus of those partners. The advice an entrepreneur gets post investment reflects the inputs of all of the partners of the firm, not just the partner managing the investment.

There are some great strengths that come from the venture capital firm approach. At USV we have benefited greatly from our work to develop an investment thesis and then evolve it over time and be rigorous in our application of it. We also benefit from the collective insights and intelligence of our partnership and broader investment team.

But the more people you put around a table, the harder it is to make really gutsy investments. And the more you stick to your disciplined investment strategy, the more you say no to people and projects you like personally.

When people ask me about the startup investments I am most impressed with, the Mike Markkula investment in Apple and the Andy Bechtolsheim investment in Google are the ones I always talk about. These were people who took out their own checkbook and backed some people with an idea they thought had merit. And they were rewarded handsomely for these investments. They took 100% of the risk and got 100% of the rewards.

Yesterday at lunch my daughter Emily asked what I plan to do when I retire in the next ten or fifteen years. I replied that "I plan to do what Mom does". It looks like a lot of fun and I think I might be pretty good at it. 


On The Beach

A belated Merry Christmas to everyone. We spent yesterday in transit and I did not have time to write a post wishing everyone season's greetings. We did our Christmas a day early on Christmas Eve (borrowing a bit from a Wilson family tradition of opening one gift on Christmas Eve) and then caught an early flight to Mexico where we are on the beach until New Year's. 


I will be taking it easy, reading a lot, and likely writing a bit too. It is the time of year to kick back and relax and I am doing just that.

#Blogging On The Road

Guest Post: Nick Grossman - Winning on Trust

This is a post Nick did around his User First keynote. It’s great and I wanted to feature it to the AVC community today. The comments thread at the end is also running on Nick’s blog and at so you will see commingled comments from all three places.


“It is trust, more than money, that makes the world go round.”
— Joseph Stiglitz, In No One We Trust

The week before last, I visited Yahoo! to give the keynote talk at their User First conference, which brought together big companies (Google, Facebook, etc), startups (big ones like USV portfolio company CloudFlare and lots of way smaller ones), academics, and digital rights advocates (such as Rebecca MacKinnon, whose recent book Consent of the Networked is an important read) to talk about the relevance of human/digital rights issues to the management of web applications.

I was there to speak to the investor perspective — why and how we think about the idea of “user first” as we make and manage investments in this space.

First, I want to point out a few things that might not be obvious to folks who aren’t regulars in conversations about digital rights, or human rights in the context of information & communication services.  First, there has been substantial work done (at the UN, among other places) to establish a set of norms at the intersection of business and human rights.  Here is the UN’s guiding document on the subject. Second, in terms of digital rights, the majority of the conversation is about two issues: freedom of expression/censorship and privacy/surveillance.  And third, it’s important to note that the conversation about digital rights isn’t just about the state ensuring that platforms respect user rights, but it’s equally about the platforms ensuring that the state does.

The slides are also available on Speakerdeck, but don’t make much sense without narration, so here is the annotated version:

As more and more of our activities, online and in the real world, are mediated by third parties (telecom, internet and application companies in particular), they become the stewards of our speech and our information.

Increasingly, how much we trust them in that role will become a differentiating feature and a point of competition among platforms.

A little background on who I am:

I work at Union Square Ventures — we are investors in internet and mobile companies that build social applications.  I also have academic affiliations at the MIT Media Lab in the Center for Civic Media, which studies how people use media and technology to engage in civic issues, and at the Berkman Center for Internet & Society at Harvard Law School which studies tech & internet policy.  And my background is working in the “open government” space at organizations like OpenPlans and Code for America, with a focus on open data, open standards, and open source software.

So, to start out: a guiding idea is that the internet (as we know it today) is not just an open, amorphous mass of random peer-to-peer communications.  It’s actually a collection of highly architected experiences:

Whether it’s the governance structure of an open source project, the set of interactions that are possible on social platforms like Twitter and Tumblr, or the web-enabled real-world interactions that are a result of Craigslist, Airbnb, and Sidecar, much of the innovation and entrepreneurial activity in the web and mobile space has been about experimenting with architectures of collaboration.

Web & mobile technologies are giving us the opportunity to experiment with how we organize ourselves, for work, for pleasure and for community.  And that in that experimentation, there are lots and lots of choices being made about the rules of engagement.  (for example, the slide above comes from an MIT study that looked at which kinds of social ties — close, clustered ones, or farther, weaker ones — were most effective in changing health behavior).

At USV, we view this as part of a broader macro shift from bureaucratic hierarchies to networks, and that the networked model of organizing is fundamentally transformative across sectors and industries.

One big opportunities, as this shift occurs, it to reveal the abundance around us.

I first heard this phrasing from Zipcar founder Robin Chase and it really stuck with me.  It’s as if many of the things we’ve been searching for — whether it’s an answer to a question, an asthma inhaler in a time of emergency, a ride across town, someone to talk to, or a snowblower — are actually right there, ambient in the air around us, but it’s previously not been possible to see them or connect them.

That is changing, and this change has the potential to help us solve problems that have previously been out of reach.  Which is good, because for as much progress we’ve made, there are still big problems out there to tackle:

For a (relatively) trivial one, this is what most California freeways look like every day.  In much of the world, our transportation systems are inefficient and broken.

…and this is what Shanghai looked like last week as a 500-mile wide smog cloud, with 20x the established limit for toxicity, rolled in for a visit.  We obviously don’t have our shit together if things like this can happen.

…and we have tons to figure out when it comes to affordable and accessible health care (not the least of which is how to build an insurance marketplace website).

…and education is getting worse and worse (for younger grades) and more and more expensive (for college).  There’s no question that the supply / demand balance is out of whack, and not taking into account the abundance that is around us.

So: these are all serious issues confronting global society (and the ones I mentioned here are just a small fraction of them at that).

All of these issues can and should benefit from our newfound opportunity to re-architect our services, transactions, information flows, and relationships with one another, built around the idea that we can now surface connections, efficiencies, information, and opportunities that we simply couldn’t before we were all connected.

But… in order to do that, the first thing we need to do is architect a system of trust — one that nurtures community, ensures safety, and takes into account balances between various risks, opportunities, rights and responsibilities.

Initially, that meant figuring out how to get “peers” in the network to trust each other — the classic example being Ebay’s buyer and seller ratings which pioneered the idea of peer-to-peer commerce. Before then, the idea of transacting (using real money!) with a stranger on the internet seemed preposterous.

Recently, the conversation has shifted to building trust with the public, especially in the context of regulation, as peer-to-peer services intersect more and more with the real world (for example, Airbnb, Uber, and the peer-to-peer ride sharing companies and their associated regulatory challenges over the past three years).

Now, a third dimension is emerging: trust with the platform. As more and more of our activities move onto web and mobile platforms, and these platforms take on increasing governance and stewardship roles, we need to trust that they are doing it in good faith and backed by fair policies.  That trust is essential to success.


In terms of network & community governance, platforms establish policies that take into account issues like privacy, enforcement of rules (both public laws and network-level policies), freedom of expression and the freedom to associate & organize, and transparency & access to data (both regarding the policies and activities of the platform, and re: the data you produce as a participant in the community).

When you think about it, you realize that these are very much the same issues that governments grapple with in developing public policy, and that web platforms actually look a lot like governments.

Which makes sense, because both in the case of governments and web-enabled networks, the central task is to build an architecture around which other activity happens.  You build the roads and the other essential public infrastructure, and then you set the ground rules which enable the community and economy to function.

Of course, there is a major difference: web networks are not governments, and are not bound by all the requirements & responsibilities of public institutions.  They are free to create their own rules of engagement, which you agree to when you decide to participate (or not) in that community.

This is both a plus and a minus, when it comes to user rights — the major plus being that web platforms are competitive with each other.  So that when there are substantive differences in the way platforms make and enforce rules, those differences can be the basis for user choice (e.g., it’s easier to move from Facebook to Google than it is to move from the US to Canada).

I would like to put some extra emphasis on the issue of data, since it’s growing so quickly and has been so much at the forefront of the public conversation over the past year.

We are generating — and sharing — more data than we ever have before.

Everywhere we go, on the internet and in the real world, we are leaving a trail of breadcrumbs that can mined for lots of purposes.  For our own good (e.g., restaurant recommendations, personal health insights), for social purposes (crowdsourced traffic reports, donating data to cancer research), for commercial purposes (ad targeting & retargeting, financing free content), and for nefarious purposes (spying, identity theft).

One distinguishing idea within all of this is the difference between data sharing that we opt into and data sharing that happens to us.  Certain web services (for example USV portfolio company Foursquare, highlighted above) make a business out of giving people a reason to share their data; getting them to buy into the idea that there’s a trade going on here — my data now for something of value (to me, to my friends, to the world) later.  It’s proving true that lots of people will gladly make that trade, given an understanding of what’s happening and what the benefits (and risks) are.

Convincing someone to share their data with you (and with others on your platform) is an exercise in establishing trust.

And my feeling is that the companies that best establish that trust, and best demonstrate that they can stand behind it, are going to be the ultimate winners.

I think about this a lot in the context of health.  There is so much to gain by sharing and collecting our health data.

And If we don’t get this right (“this” being the sensitive matter of handling personal data), we miss out on the opportunity to do really important things.

And there is no shortage of startups working to: a) help you extract this data (see 23andme), b) help you share this data (see Consent to Research and John Wilbanks’ excellent TED talk on sharing our health data), and c) building tools on top of this data (see NYU Med Center’s virtual microscope project).

We are pushing the boundaries of what data people are willing to share, and testing the waters of who they’re willing to share it with.

Which brings us back to the idea of competition, and why winning on trust is the future.

We are just just just scratching the surface of understanding whether and how to trust the applications we work with.

EFF’s Who Has Your Back report ranks major tech & communications firms on their user protection policies.  The aptly-titled Terms of Service; Didn’t Read breaks down tech company Terms of Service and grades them using a crowdsourced process.  And, most effectively (for me at least), the Google Play store lists the data access requests for each new application you install (“you need my location, and you’re a flashlight??”).

You might be saying: “that’s nice, but most people don’t pay any attention to this stuff”.

That may be true now, but I expect it to change, as we deal with more and more sensitive data in more parts of our lives, and as more companies and institutions betray the trust they’ve established with their users.

There is no shortage of #fail here, but we can suffice for now with two recent examples:

Instagram’s 2012 TOS update snafu caught users by surprise (who owns my photographs?), and this summer’s NSA surveillance revelations have caused a major dent in US tech firms’ credibility, both at home and especially abroad (not to mention what it’s done to the credibility of the US gov’t itself).

So… how can web and mobile companies win on trust?

We’re starting to see some early indications:

Notice the major spike in traffic for the privacy-oriented search engine, USV portfolio company, DuckDuckGo, around June of 2013, marked by [I] on the graph.

Some companies, like Tumblr, are experimenting with bringing more transparency to their policy document and terms of service.  Tumblr’s TOS include “plain english” summaries, and all changes are tracked on Github.

And of course, lots of tech companies are beginning to publish transparency reports — at the very least, starting to shine some light on the extent to which, and the manner in which, they comply with government-issued requests for user data.  Here are Google’s, Yahoo’s and Twitter’s.

There are juicier stories of platforms going to bat for their users, most recently Twitter fighting the Manhattan DA in court to protect an Occupy protester’s data (a fight they ultimately lost), and secure email provider Lavabit shutting down altogether rather than hand over user data to US authorities in the context of the Snowden investigation.

And this will no doubt continue be a common theme, as web and mobile companies to more and more for more of us.

And, I should note — none of this is to say that web and mobile companies shouldn’t comply with lawful data requests from government; they should, and they do.  But they also need to realize that it’s not always clear-cut, that they have an opportunity (and in many cases a responsibility) to think about the user rights implications of their policies and their procedures when dealing with these kinds of situations.

Finally: this is a huge issue for startups.

I recently heard security researcher Morgan Marquis-Boire remark that “any web startup with user traction has a chance of receiving a government data request approaching 1”.  But that’s not what startups are thinking about when they are shipping their first product and going after their first users.  They’re worried about product market fit, not what community management policies they’ll have, how they’ll respond when law enforcement comes knocking, or how they’ll manage their terms of service as they grow.

But, assuming they do get traction and the users come, these questions of governance and trust will become central to their success.

(side note: comments on this post are combined with this post on and this thread on, as an experiment)

#Politics#regulation 2.0#Web/Tech

A New Look For 2014

I have been unhappy with the way this blog looks for a while. I've fallen into my typical habit of putting too many widgets on it and messing things up. I have also discovered that the layout of the blog is making disqus work more poorly on mobile than it should. Many of you have run into problems commenting on mobile and it's likely that is my fault, not disqus' fault. I also want to do an even better job of optimizing the blog for reading on phones and tablets. That was the goal of the last redesign, which we did in the spring of 2010, but a lot has changed with responsive design since then and we are going to leverage all of that to make AVC even better on mobile.

I am also going to port this blog from Typepad to WordPress. I've been wanting to do that for a long time but I've held off because it's a big effort and I didn't have the stomache for it. But I do now. We will port all of the posts and disqus comments, but I am going to leave the old typepad comments behind. They are full of spam anyway and its too much work to clean that up.

I will be working with Nathan Bowers who has helped me with this blog for quite a while now. He and I work well together and I am confident we can get this done in a month or so.

So now is the time to let us know what you like and don't like about the look and feel and user experience on AVC. Please share that with us in the comments.


Founders and CEOs

I watched the Steve Jobs movie with Ashton Kutcher last night on the flight to Salt Lake City. It wasn't great to be honest but the board room scences with Jobs, Markkula, and Arthur Rock (and later on John Sculley) were pretty compelling. 

Having been through some of that myself over the years, I winced when Arthur Rock came down hard on Jobs and was depicted as a patronizing father figure. Mike Markkula got much better treatment and came across as the good guy who tried to to the right thing by Jobs. 

The pivotal scene in which Sculley decides he can't do the CEO job effectively with Steve Jobs in the company and asks for a board vote to choose between the two of them, which goes his way, is painful to watch. 

One wonders what would have happened had Jobs stayed in the company, worked with Sculley for a while, and then ascended to the CEO job when he developed to maturity and managerial instincts for the job. The story of Google, with Eric Schmidt in the Sculley role, and Larry Page in the Jobs role, is instructive here.

Did Jobs' personality make that impossible? Was Sculley guilty of not trying hard enough to build a functional partnership wtih Jobs? Was the board guilty of not trying harder to make the situation work?

I've read the Jobs book as well and it seems that this was a very tense and emotionally packed situation. In situations like that Boards really struggle to get things right. Ultimatums are made and Boards are asked to make a decision. 

One thing I know is companies are better off when their founders remain involved in the business, even if they are not the right person to run it. That is not always possible and sometimes a scenario like what happened to Steve Jobs plays out. But it's not the ideal way to resolve these conflicts.

#VC & Technology

Video Of The Week: The Nexus Wireless Charger

A few weeks ago, I got a Nexus Wireless Charger and put it on the shelf next to our front door where I leave my phone to charge when I get home. It worked so well and I like it so much that I got another one for our family room to charge the Nexus 7 that we use to control our audio and video in our home.

I set it up this morning and I think I have now solved the problem of having the tablet run out of power because my kids don't plug it in. Now all they have to do is place the tablet on the little pad on the family room side table each night after they turn off the TV. 

So I thought I would share a video with all of you that shows how this little thing works. It is really awesome.