The Liquidity Crisis

There is a problem that is solvable when it comes to startups. It’s liquidity. Over the past couple of years, I have seen Fund of Fund managers like Chris Douvos, Michael Kim, and Lindel Eakman talk about this problem on their blogs. I have also seen funds like Calpers talk about the liquidity problem in articles and documents.

Why is it a problem?

If you put money in, and can’t get out, it’s going to disincentivize investing. That means less money flows to innovation. Less money into innovation and that means society doesn’t propel itself forward. In a capitalistic society, it is critical to have creative destruction.

It also means that ordinary people cannot invest their money in public companies that are innovative. They have to wait and that means they can’t build wealth as easily. This also might explain the ICO craze. Risk capital is being invested in it Continue reading "The Liquidity Crisis"

How Blockchain Will Accelerate Business Performance and Power the Smart Economy – SPONSOR CONTENT FROM MICROSOFT

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Political economist Francis Fukuyama predicted a future when social capital would be as important as physical capital, and that only those societies with a high degree of social trust would be able to create large-scale organizations capable of competing in the new economy.

Two decades later, an incredible tool is shoring up the foundations of social at the level of every transaction—blockchain. Originally gaining notoriety as the data technology underneath the cryptocurrency called bitcoin, today blockchain technology is expanding its reach far beyond the confines of currency and tackling issues involving transactional social trust throughout the world.

Blockchain is a cryptographically secure, shared data layer that enterprises can use to digitally track the ownership of assets across trust boundaries, opening up new opportunities for cross-organizational collaboration and imaginative new business models. As a shared source of trust, it can extend the scope of digital transformation from a single company to

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Why Wages Aren’t Growing in America

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The majority of Americans share in economic growth through the wages they receive for their labor, rather than through investment income. Unfortunately, many of these workers have fared poorly in recent decades. Since the early 1970s, the hourly inflation-adjusted wages received by the typical worker have barely risen, growing only 0.2% per year. In other words, though the economy has been growing, the primary way most people benefit from that growth has almost completely stalled.

Understanding how and why this stagnation occurred is not just an academic question — it is essential to redesigning public policies so that more Americans share in the benefits of economic growth. In a recent Hamilton Project at Brookings report, we highlight what we believe are some of the most critical developments over the last few decades and consider what is necessary for the typical American to get a raise.

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Attention on Digital Monopolies

The dominant position of companies such as Google, Facebook, Amazon is sure receiving a lot more attention these days. There is critical media coverage, including in traditionally pro business publications such as the Wall Street Journal “Can the Tech Giants Be Stopped?” and Bloomberg “Should America’s Tech Giants Be Broken Up?”  There is also the Democratic Party’s “Better Deal” memo which focuses more broadly on the negative effects of corporate power. And then of course there is the European Union, which already fined Google 2.4 Billion Euros for manipulating search results and is considering another fine for Google’s alleged forced bundling of Google services with Android. While I am happy to see the attention on the issue, I am concerned that regulators are missing the fundamental source of monopoly power in the digital world: network effects arising from the control of data. This will continue to lead Continue reading "Attention on Digital Monopolies"

Something to Remember on the 4th

The 4th of July is an auspicious day in human history.  For the first time, a society was organized around the principle that the rights of humans came before the rights of the government, monarchy or ruler that administered them. President John Adams always said the day should be remembered with the proper pomp and circumstance.  Fireworks are perfect.  The explosion of human freedom that happened because of what the Founding Fathers did is simply amazing. When I read the story of Paul Revere, I was surprised at the level of fervor for individual liberty that was ingrained in every single American.  Property rights were paramount.  Markets organized society, not governments.  Revere and his peers would not be happy with the way America is today. Across the country, many of our governments have forgotten it’s not about them.  It’s about the citizens.  Both Democratic and Republican legislators have forgotten.  The Continue reading "Something to Remember on the 4th"

The LP Opportunity to Change Tech Culture

Over the past month, Silicon Valley has been at the forefront of many conversations outside of the technology world.  Unfortunately not for groundbreaking technology, but for rampant sexual harassment and predatory behavior. The stories outlined by a number of brave women in the NY Times last week recount investors using their power and position to proposition female founders.  Just a week before, Justin Caldbeck, founder of Binary Capital, admitted to sexually harassing a number of women who were seeking investment from his fund.  Binary Capital was dissolved within days by its investors once the extent of the allegations were revealed. While this behavior has existed in the industry for years, women are now standing up and speaking out.  For too long, too many men have taken the view that women were “reading too much” into behavior, didn’t have a “sense of humor”, or just didn’t Continue reading "The LP Opportunity to Change Tech Culture"