Posts from October 2018

One of the big trends in startup land over the last decade is consumer brands getting built direct to consumer (D2C) on highly efficient advertising channels like Google, Facebook, Instagram, Twitter, and YouTube. In these online channels, brands can test, measure, test, measure, test, measure, and then figure out what works and scale.

But these channels are getting more challenging as they have been optimized and scaled by thousands of brands over the last decade and the marketers in D2C land are increasingly looking around to see if there is anywhere else they can go.

Enter our portfolio company Simulmedia, which we invested in almost ten years ago to bring the transparency and efficiency of online advertising to television.

Simulmedia has launched an offering for these D2C companies to help them add television to their marketing mix. Television is hard for small companies. The initial buys are large and it is challenging to “test, measure, test, measure, test, measure” to optimize before you scale.

So Simulmedia has brought D2CX market. 

D2Cx is a marketplace featuring over 135 national TV networks, making it easy for direct-to-consumer brands to test TV advertising at low entry prices, learn what’s working, and scale.

You can start for as little as $50k and 100% of the cost of the media will go towards the purchase of media.

If you want to try out D2CX for your company/product, you can learn more here and sign up to try it out.

The Partnership For New York City operates some excellent “vertical” accelerators for companies that are getting started and are focused on serving industries with big footprints here in NYC.

Financial Services – FinTech Innovation Lab

Health Care – Digital Health Innovation Lab

Fashion – Fashion Tech Lab

Biotech – The BioAccelerate Prize

Transit – Transit Tech Lab

Both the Transit Tech Lab and the FinTech Innovation Lab are accepting applications right now for their next programs.

You can apply here:

Fintech Innovation Lab

Transit Tech Lab

Consumer surplus is the delta between what consumers expect to pay or are willing to pay for an item and what they actually have to pay given market dynamics. A good example of where we are generating a lot of consumer surplus is technology. I would be happy to pay for my email (and do) but I can get it for free from Gmail. A 49″ smart TV sells for about $300 on Amazon. A Samsung Chromebook is $200 on Amazon.

I like to think of all of this “found money” that consumers are getting from technology as the dividend we are getting from the technology revolution. It is also true that technology takes jobs out of the market, and adds them too, and that it may be a zero sum game or worse.

But the truth is many things have gotten a LOT less expensive over the last twenty years and that has made managing the household budget a fair bit easier.

My colleague Nick sent me this chart yesterday. I don’t know where he got it so I can’t identify the source.

What you see from the chart is that wages have increased about 70% over the last twenty years and many things, including housing, food, clothing, and most dramatically technology, have increased less, or have actually gone down in price, creating room/surplus in the household budget.

But not everything has gone down. Health care and education, most notably have increased dramatically.

So it is time to take aim at those sectors. We can do the same with education that we have done with other services. And we will. I feel that healthcare will be a harder lift, but I do think it can be tackled too.

In fact, our current thesis at USV compels us to go after these sectors. So we will.

I am excited about the potential to bring consumer surplus to these sectors and make more room in the household budget in doing so.

This video is an advertisement in support of a group of women running for national office in these midterms.

I am compelled by this advertisement and these women. I am very hopeful that women like these will increasingly lead our congress and our country.

Our portfolio company Coinbase announced this week that they will be adding the USDC Stablecoin to their various services in the coming weeks. 

This video below explains what the USDC stablecoin is and why it is important.

Four years ago, filmmaker Torsten Hoffmann raised $AUS 17,000 on Kickstarter to make a documentary about Bitcoin called The End Of Money As We Know It. The film was released in July 2015 and I watched it and thought it was very good.

Torsten is back with a follow-up film project called Cryptopia and I backed it today. 

Ever since the first cryptonetwork, Bitcoin, was created, investors have had the opportunity to earn returns by engaging in the network. In Bitcoin’s case, that was done by mining the network, effectively powering it.

As the sector has grown, investors have largely turned their attention to buying and holding cryptoassets, and not that many of us are actively engaging in them.

But that is likely going to change for several reasons.

First, in proof of stake networks, asset holders will want to stake their tokens and earn the rewards of doing that, or risk being diluted/inflated. Conversely, those who do stake will earn rewards that will feel a bit like collecting interest or dividends on a bond or stock.

This technique of turning an idle asset into an incoming producing asset by engaging in the network is part of the design of many cryptonetworks and investors are going to increasingly want to do these things (staking, validating, governing, etc) to earn the rewards of that engagement.

There is another aspect to this, outlined by Tushar Jain of Multicoin earlier this week on their blog.

Tushar points out that asset holders can act with their capital to help bootstrap the network by providing storage on the Filecoin network or transcoding on the LivePeer network or creating DAIs on the Maker network.

The good news for investors is that there are a whole bunch of entrepreneurs setting up shop right now to help us do these things without each and every one of us becoming super technical about the ins and outs of each of these cryptonetworks. We will see (and are seeing) staking as a service, nodes as a service, and the like. These third parties will be like the proxy companies are in the stock markets.

I expect the custodians, like our portfolio company Coinbase, to offer many of these services, either as the provider themselves or the gateway to the third party provider, thereby making it even easier for us to engage in these networks.

It’s an exciting time to be a cryptoinvestor. A host of new cryptonetworks are starting to go live. The next 18 months will see many dreams come to fruition and with those dreams will come demands on the investors to engage instead of just hold. I am looking forward to doing that.

Jet lag is such a challenge for me.

We got back from Japan four days ago and I was doing great.

I figured that I had it beat this time.

Then last night at 2am, I woke up and I was wide awake.

We’ve got a series of meetings today that I need to be coherent in.

So I took a half a pill and got back to sleep by 3am and slept until almost 8am.

The good news is I am rested.

The bad news is I don’t have this thing beat like I thought I did.

I have tried a bunch of things to manage jet lag over the years, many of them recommended by folks here at AVC in reaction to a post about this I did a few years ago.

And they have all worked, to a degree.

But, I think the truth is, at least for me, that it takes me about a week to get truly back to normal after a long trip to Asia.

And as much as I thought I could shorten that timetable, I don’t think I can.

Naomi posted some thoughts on changing business models in health care on the USV blog yesterday.

The one that I am personally most excited about is what Naomi calls “change of venue” and within that I like the “virtual primary care” model.

A pure virtual primary model eliminates fixed costs associated with brick and mortar expansion and is able to focus resources on reaching more patients, recruiting more doctors to their platform, and improving the experience for current patients. Payments on a subscription basis allow doctors to get paid more consistently rather than waiting for insurance companies to process claims and paying overhead costs to negotiate reimbursements with their billing offices.

We have portfolio companies executing this model like Nurx and Modern Fertility and we hope to add more.

I value the doctor/patient relationship, but I think there is a lot technology can do to make that relationship less expensive, more engaging, and more convenient (for both parties). And generational changes in doctors and patients are catalyzing and facilitating this transition.