There’s a question we ask ourselves when investing in a startup outside of the Bay Area: is their location a positive for the company? We believe great companies can be built in many locations – not just beloved Silicon Valley – but we do want to articulate *why* a specific company benefits from its geo. This can be based in the founders (strong hiring relationships locally), the local industry (access to customers, partners, talent) or academic hubs (research, talent).
Our second Homebrew fund, the one we’re currently investing out of, has three Southern California startups, all of which are absolutely better, more durable companies being based where they are versus if they had started in the Bay Area.
Joymode (LA), Lumi (LA) and Shield (San Diego) each take the DNA of their home cities and imbue their companies with a sense of purpose. They’re amazing technical teams without being myopically Continue reading "SoCal Stunners: Why Homebrew Has Gone South"
I try to post here at least once every 14 days and if I don’t, it’s usually a bad sign. This time the lag was for *good* reasons: Satya and I were finishing up the close of our third Homebrew venture fund, a $90m commitment to back new startups.
Now back to work. And hopefully writing here more often again….
I haven’t written much about Homebrew’s investments in the agriculture space but there are two of note, and both are based on beliefs which might be controversial to some.
- Our global food supply chain still functions as if water is free and limitless.
- Our global food supply chain assumes that cheap labor is available wherever and whenever needed.
Climate change, consumer demands from a rising standard of living, and shifting political attitudes towards immigration, have put both water and labor very much at risk, especially when you look at the arc of the next 10+ years. But you don’t have to wait a decade to read about dramatic changes afoot. Chad faces a security and humanitarian crisis very much linked to a pivotal water resource drying up. Cape Town creeps towards its “Day Zero” drought where the country will be out of water. Our beliefs about water supply Continue reading "What Happens to Farming When Water Is 10x More Expensive & Labor Is Scarce?"
“Look, I’m incredibly thankful for this industry. It made me a millionaire.” The person seated across the table from me went through a series of facial microexpressions as I said this — surprise, disgust, analysis and finally, calm. We don’t really talk about money in Silicon Valley. At least not in public in a personal way with near strangers. We *speculate* about people and wealth a shit-ton – based upon a company’s last fundraise, based upon current stock price, based on the market price of BTC – but we don’t really talk our own situations, challenges, learnings. When a notable exception occurs – Jason Hirschhorn’s post about selling his first company – it really sticks for me as valuable. Don’t values and community come from sharing experiences and being vulnerable together? I think so but then why am I getting nervous about writing this post? This is a fraught
Continue reading "We Don’t Talk Enough About Money In Silicon Valley. No, Really."
Not gonna lie. All those “Books of 2017” posts made me kinda wishing I kept a list of my own. No way for me to go back and figure out what I read last year (I give away most books once I’ve completed them) so instead will make this a living post, where I add as I finish. If we generously start 2018 on 12/26/2017, here’s what I’ve read so far in reverse-chron order:
3) A Uterus Is A Feature, Not A Bug – Sarah Lacy [non-fiction]
A “personal” one for me as we’ve known Sarah and her family for a quite a while, but really bonded over becoming parents around the same time earlier this decade. Half-memoir, half-reporting, this was one where I didn’t want to let the year end without reading given my hope that 2017 was a turning point in how we think about gender in technology.
Continue reading "Books I Read In 2018"
We’d barely made our first venture investment when I tattooed Homebrew’s logo deeply into my right shoulder. What did this moment represent, besides a strong conviction we’d never rebrand? It wasn’t a victory lap, that’s for sure, because it takes many years to prove you’re great as a VC. No, it was memorializing the decision to *start* Homebrew, independent of the eventual quality of outcome. Of course I believe that Satya and I have the potential and capacity to be excellent investors and now approaching our third fund there’s ample evidence that at least we’re not terrible and, hey, we might even be good at this. But that wasn’t what I was capturing when that needle jabbed into my skin, depositing a little black ink each time. What I was capturing – what I was owning and memorializing was that it was a really good decision.
When Wired claims YouTube is the world’s best film school available, I would agree, but suggest they’re actually thinking too narrowly in their explanation. Writer David Pierce steps us through what he calls “YouTube Film School,” a loosely organized community of content on the platform which unpacks and analyzes the craft. Pierce believes “the best channels are the ones that teach film as an art form, that help you understand why a particular cut or camera move makes you feel the way it does.” And while there is a tremendous amount of YouTube content supplying technical analysis, critique and breakdowns, to focus on these videos alone ignores the most wonderfully disruptive aspect of YouTube: the 100x faster cycles of content creation over traditional media.
Compare the evolutionary cycles of humans versus guppies. Humans evolve v e r y s l o w l y, while guppies can experience
Continue reading "Evolutionary Biology: Movies are Slow Humans. YouTube are Fast Guppies."
I don’t really understand most of the proposals to “regulate” Facebook. There are some concrete proposals on the table regarding political ads and updating antitrust for the data age, but other punditry is largely consumer advocacy kabuki. For example, blunting the data Facebook can use to target ads or tune newsfeed hurts the user experience, and there’s really no stable way to draw a line around what’s appropriate versus not. These experiences are too fluid. But while I want keep the government out of the product design business, there’s an alternate path which has merit: establish a baseline for the control a person has over their data on these systems.
Today the platforms give their users a single choice: keep your account active or delete your account. Sure, some expose small amounts of ad targeting data and let you manipulate that, but on the whole they provide limited or
Continue reading "Should Regulators Force Facebook To Ship a “Start Over” Button For Users?"
Here’s what I want.
The ability to add a phone number/contact to a list. With one-touch dialing from that list entry.
The ability to set variables at the contact/# level that are either persistent or apply only to this call. For example, time zone or priority, or expected call duration (how long I need for the call).
Default is for the list to be sorted “manually” (probably reverse chron of entry – Last In, First Out) but also apply “smart sort” based upon an amount of time I have to make calls before next meeting, what part of day it is in each contact’s home time zone, and so on.
After making this prioritization decision, I want to be able to press “Play” and have the app automatically call the first number. If it connects, we start talking. If it doesn’t connect, it moves to next number in my list
Continue reading "Request For App: Calls I Need To Make"
Type “coalition” into Google Trends and you get a disturbing result. A 12-year decrease in interest. It’s anecdotal but easy to also map this graph to the increase in political and societal tribalism. Moving away from the idea we can work together even if some of our beliefs are in conflict.
“We might not agree on everything but can we agree to work together on this?” seems like a pretty powerful and potentially effective solution. One that most of us learn informally during childhood. “Politics makes strange bedfellows” is another idiom I recall hearing often when studying governance (turns out its origins are from Shakespeare’s Tempest).
Going into the next year perhaps we can all be a little more open to finding the common ground in our relationships.
It’s no longer worth it to vocalize controversial beliefs. Silicon Valley has become a PC echo chamber. I can’t say what I think without fear of reprisal.
These are not beliefs I personally hold but ones which I’ve heard expressed with increasing volume from people I know well and people I don’t know as well, in public spaces and in private conversations. Often these sentiments are expressed by 30 – 50 year old white men (and women) of economic privilege. I say this not to discredit their feelings or observations but because (a) it does seem to be relevant and (b) that’s the group which dominates my own social circles, which means that my POV is constrained by my own limitations in perspective.
But obviously since you’re reading this, I felt confident enough I had something to say that I’m wading into this conversation. Not to dissect a blog post.
Continue reading "What I Think We’re Talking About When We’re Talking About What We Can’t Talk About"
It’s the season of giving, so when my friend Nathan Bashaw asked for follow-up on my last post, well, I cracked open WordPress to deliver! Nathan wanted my POV on the difference between bullshitting to investors versus telling a BIG VISION CRAZY STORY.
So here we go…..
Bullshitting is telling prospective investors one story – what you think they want to hear and you’re not really committed to – while telling your team another story. Making Them Believe is articulating what your company has the chance to become, even if it’s dependent on lots of hard work and there’s lots of unknown between now and then. Remember, VCs are listening for what could happen if things go right, not wrong.
Bullshitting is building a spreadsheet with assumptions which
Continue reading "You Can’t Bullshit a Good VC, But You Can MAKE THEM BELIEVE"
None of our portfolio companies seeking additional dollars in 2017 had a “standard” venture fundraise. You know, the one where you advise the company “plan to take 2-3 months to get one or more term sheets and then another month to close.” Zero. Every one of them were feast or famine. 2-4 weeks to multiple termsheets (sometimes under a week!) or 4+ months of meetings and milestones before finding the additional capital (or in one or two cases, *not* finding the additional dollars) they needed.
The startups which took longer were mostly very solid businesses with quality teams. Companies where we would have certainly done our pro rata in a new round. My partner Satya summarized part of our reaction in this tweet:
Since Facebook, Twitter and YouTube have all been vocal (to various degrees) about staffing up the human element of their content moderation teams, here are a few things to understand about how these systems typically work. Most of this is based on my time at YouTube (which ended almost five years ago, so nothing here should be considered a definitive statement of current operations), but I found that most of our peer companies approached it similarly. Note, I’m going to focus on user generated/shared content, not advertising policies. It’s typical that ads have their own, separate criteria. This is more about text, images & video that a regular user would create, upload and publish.
What Is Meant By Content Moderation
Content Moderation or Content Review is typically a term applied to content (text, images, audio, video) that a user has uploaded, published or shared on a social platform. It’s distinct
Continue reading "Internet Content Moderation 101"
You ever notice how when someone leads off by saying, “Now, I don’t mean to overgeneralize but…” they almost always are overgeneralizing? Now, I don’t mean to overgeneralize but I want to tell you about something that reporters and pundits frequently get wrong when evaluating the venture-worthiness of a failed startup. They focus on the answer to the question “what are all the things which could have gone wrong here” versus “how valuable would this company have been if things went right?”
VCs are in the business of backing companies that have a substantial chance of failing and the earlier you invest, the more likely you are to see a zero return on your capital. What offsets this is that the successes tend to be outsized, returning 20x, 50x, or even 100x+. The notion that tremendous value is created by a very small percentage of startups, and the financiers
Continue reading "For VCs, “What Could Go Right” Is More Important Than “What Could Go Wrong”"
Flying back to San Francisco, spending some time in my Pocket since I rarely read anything when it’s actually published. Here are a bunch of posts that I enjoyed, most VC or startup related, so if you don’t care about that stuff, skip this.
The Angel’s in the Details – Andy Dunn, Walmart (Bonobos cofounder/CEO)
Andy is a ‘wears it on his sleeve’ type of guy and his writing is always passionate and personal. This post reminded me how much I hate when I hear a leader of any type say something like “well, you can’t expect me to know everything that’s going on” or “that happened below my paygrade” versus accepting responsibility.
Six Ways Great Companies Use Board Decks to Their Advantage – Union Square Ventures blog
Solid meat and potatoes post about good board decks. Board meetings can be some of the best discussions and informative sessions if
Continue reading "Five Posts I Would Have Written If Someone Else Hadn’t"
Something NEW and TRUE. Every time I’ve asked for feedback from those around me in a structured format I’ve received a gift. A learning that was previously unknown to me (NEW) and, even if I want to deny it, 100% correct (TRUE). My first N&T arrived when I was in grad school as part of a semester long T-group with a dozen or so of my classmates. Here I learned about a way I was unintentionally creating resentment by making people feel judged and discarded. By acknowledging and understanding these reactions I was able to improve myself.
The second N&T emerged during a 360 Degree Assessment that I received upon making Director at Google. You know I heard? That I was actually a pretty shitty manager of people who had different communication styles and motivations than I did. So again, I took it to heart and evolved (and also made
Continue reading "What I’ve Learned When I Ask For Feedback"
“1) VC money is not evil. 2) VC money is not sustainable.
Those are not contradictory statements.”
Those are Rafat Ali’s words from a post he wrote Friday in reaction to the cascade of bad news for a bunch of venture-backed new media companies. While Rafat’s expertise is concentrated in media (he started and sold Paid Content and now runs vertical travel startups Skift), the statements above apply generally (we’re investors in theSkimm and Cheddar, so clearly believe there is a place for venture here).
The most challenging aspect of taking venture capital is that it’s difficult to step off of the venture train once you’ve taken too much money, or negotiated too high a valuation, or gone too deep on executing a plan that requires high burn ahead of profitability. But complaining about that or assuming it’s fundamentally “evil,” is like getting married and then complaining it makes
Continue reading "Rafat Ali on Media Startups and the Nature of Venture"
There are 43 days left in 2017. That’s not many for any of us, but it’s an especially important countdown if you work at Google, Apple or any other tech company which has an employer match program for charitable donations. Have you maxed out your match yet? Please consider doing so and let me give you an idea for a fun way involving your team and colleagues.
During my last few years at YouTube we were able to raise tens of thousands of dollars in just a few hours by creating FlashMobs for Good where we turned charitable giving into a critical mass event. Here’s what we did and I’m hoping some of you will try this at your company:
- Pick a period of time (24 – 48 hours work best) and declare it a “FlashMob for Good” during which you’ll track the combined donations going from your company to
Continue reading "If You Work at Google or Apple, I Need You To Read This Post About Charity & “FlashMobs for Good.”"
I hope some male VCs got scared yesterday, and if they didn’t, they should. Seeing Jess Lee of Sequoia bring together a group of amazing female investors as part of Female Founders Office Hours isn’t just about empowering women. It’s about keeping firms who don’t have female investing partners out of this dealflow. That’s not the stated intent of FFOH, which is about relationships and kicking off a “virtuous cycle of women helping women,” but hopefully a secondary effect of this group. And I think that’s great.
I’ve joked that if VCs found diversity as interesting as crypto we’d make much faster progress on solving gender and underrepresentation in our industry. VCs are market-driven — they’ll move towards opportunity with high velocity. Similarly they’ll seek to solve existential threats, otherwise they’re in the business of offense, not defense. Homebrew, my seed fund, doesn’t have a female GP – it’s
Continue reading "“Thoughts & Prayers” Won’t Change VC Diversity But Incentives Will. Supporting Female Founders Office Hours."