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Month: March 2019

The Valuation vs. Traction Matrix

by Jason Calacanis
This post is by Jason Calacanis from Jason Calacanis

Early-stage valuations for startups are hard to understand because typically there is very little traction or data to go on in the first year or two of a startup.

[ Click to Tweet (can edit before sending): https://ctt.ac/fPF9l ]

Startup valuations are not science, but they’re not magic either. It’s a bit of alchemy, combined with bizarre marketplace dynamics like famous founders getting 3x the price for half the traction, or Y Combinator hosting a gigantic demo day in order to create FOMO with novice investors who are explicitly told not to think things through and just cut a big check (literally, that’s their bad advice to investors).

The chart above, a work in progress, is called “The Valuation vs. Traction Matrix” and it pivots on two variables: traction (aka “stage”) vs. valuation.

I started the valuation at the basic valuation we tend to see in technology startups, which is $1-2m and go up to the eye-popping $12m (which is actually not the peak, just the highest end of normal).

When you have just an idea or mockup, you are likely to do a “friends and family” round in the $1m range.

If you have an MVP or unpaid pilots, you might get some angels or seed funds involved.

When you get to paid pilots or revenue, then you are most likely to get seed funds and syndicates involved, after which the VCs start buzzing around. VCs invest, on average, when you have $2-3m in revenue these days (they might (Read more...)

183. Automation vs. AI (Adeyemi Ajao)

by Nick Moran

Adeyemi Ajao of Base 10 Partners joins Nick to discuss Automation vs. AI. In this episode, we cover:

  • Backstory - Growing up in Spain and Nigeria and his path to entrepreneurship.
  • Previous to Base10 Partners, you had quite a successful career as an entrepreneur, founding highly influential companies such as Tuenti, Identified and Cabify in Latin America - talk a bit about your experience founding and scaling multiple tech companies, ultimately to exit?
  • How did you, TJ and Reggie come together and decide to create Base10?
  • On the website it says that you "started Base10 to take a profoundly different approach to Automation." Tell us more about your thesis on automation and how it's different.
  • Talk about Automation vs. AI and the potentially misleading guidance that we're hearing from many firms in the valley with regard to AI.
  • Of course, with any big changes that are made to the way people traditionally do things, there is a reaction. While some will embrace automation tools, others will have an adverse reaction. Are there certain sectors, categories or even functions that you think will more readily adopt automation solutions?
  • You mentioned a number of industries... Real Estate, Construction, SaaS, Agriculture, Logistics, Consumer... you have these Partners listed on the website, like Fifth Wall, Bessemer, Owl, Shasta, Bain Capital... can you explain the details of your partnership program?
  • When researching sectors that you’re interested in and assessing the opportunity to implement automation tools, what key factors are you looking for?
  • "We know automation. (Read more...)

183. Automation vs. AI (Adeyemi Ajao)

by Nick Moran

Adeyemi Ajao of Base 10 Partners joins Nick to discuss Automation vs. AI. In this episode, we cover:

  • Backstory - Growing up in Spain and Nigeria and his path to entrepreneurship.
  • Previous to Base10 Partners, you had quite a successful career as an entrepreneur, founding highly influential companies such as Tuenti, Identified and Cabify in Latin America - talk a bit about your experience founding and scaling multiple tech companies, ultimately to exit?
  • How did you, TJ and Reggie come together and decide to create Base10?
  • On the website it says that you "started Base10 to take a profoundly different approach to Automation." Tell us more about your thesis on automation and how it's different.
  • Talk about Automation vs. AI and the potentially misleading guidance that we're hearing from many firms in the valley with regard to AI.
  • Of course, with any big changes that are made to the way people traditionally do things, there is a reaction. While some will embrace automation tools, others will have an adverse reaction. Are there certain sectors, categories or even functions that you think will more readily adopt automation solutions?
  • You mentioned a number of industries... Real Estate, Construction, SaaS, Agriculture, Logistics, Consumer... you have these Partners listed on the website, like Fifth Wall, Bessemer, Owl, Shasta, Bain Capital... can you explain the details of your partnership program?
  • When researching sectors that you’re interested in and assessing the opportunity to implement automation tools, what key factors are you looking for?
  • "We know automation. (Read more...)

As goes Uber, so goes the nation

by Roy Bahat

Where I make the case that we need a “Treaty of Silicon Valley,” for workers to thrive — like Walther Reuther’s “Treaty of Detroit” that set work up for decades in the U.S.

Lyft and Uber, like many companies in the new economy, have been unable to provide their workers with a stable and complete livelihood. Still, with their bully pulpit and their relationship with millions of Americans, they might be our best hope for provoking change.
That change starts with something unfamiliar to Uber and Lyft: partnering with government. Instead of using their muscle to whine to cities about taxi regulations, Uber and Lyft should call on government to lift the floor for working people.

Hosted on Noah Smiths’ blog (thank you!).

President Truman with Walther Reuther, head of the United Auto Workers

As goes Uber, so goes the nation was originally published in Also by Roy Bahat on Medium, where people are continuing the conversation by highlighting and responding to this story.

How to become an analyst at a venture capital firm (hint: apply now)

by Jason Calacanis
This post is by Jason Calacanis from Jason Calacanis

We’re looking for an analyst to work at LAUNCH to help us sort through the dozens of applications that come in a day for Founder.University, LAUNCH Accelerator, Jason’s Syndicate and our events (SCALE, LAUNCH Festival, Angel Summit).

The analyst position a venture firm is considered the best way to break into investing, but that’s not true. The best ways to break into investing — in order — are:

  1. Make a huge amount of money and start your own firm (see Chamath)
  2. Be part of taking a company public (or selling it) for a huge return, which will result in you being invited to join a major venture capital firm (see Roelof Botha of PayPal or Alfred Lin of Zappos, both recruited to Sequoia Capital).
  3. Be the growth person at a top startup (see Josh Elman of Greylock)
  4. Go to Stanford or HBS (in the old days)
  5. Be a world-class journalist (OM, MG)

An analyst is a very hard gig to get, but they do come up once and a while.

Since I came into the game and made my own lane, I’m looking for someone like me: a writer.

Why a writer?

Because writers spend every day trying to cut through the bullshit that is thrown at them by CEOs and PR firms, to give their readers the truth (or at least that’s what journalists used to do). 

Also, I’m planning on having this writer not only send me coverage of (Read more...)

I’m on a Mission

by jasoncalacanis
This post is by jasoncalacanis from Jason Calacanis

I’m on a mission to teach 10,000 accredited investors how to angel invest and share their deals.

[ Click to Tweet (can edit before sending): https://ctt.ac/G8gYc]

As many of you know, I wrote the book ANGEL, created a companion podcast and now I’m hosting a half-day course called Angel University.

Here are the upcoming dates for our Angel University courses:

  • April 19: Washington, DC (hosted by Riverbend Capital)
  • April 23: Boston, MA
  • April 24: New York City (supported by EquityZen)
  • April 26: Columbus, OH (hosted by WillowWorks)
  • April 29: Miami, FL
  • June 17: Sydney, Australia
  • July 15: San Francisco

The Angel University curriculum is designed for everyone, from angels who haven’t done a deal yet to seasoned angels who have done over 100. We cover five key topics: sourcing deals, evaluating startups, negotiating deals, portfolio and bankroll management, and post-deal efforts. It’s a ton of fun.

The tour workshops are four hours and are followed by dinner. Seating is limited to 50.

Join me: http://angel.university/tour.

PS – Thanks to Riverbend Capital for hosting us in DC, WillowWorks for hosting us in Columbus, and EquityZen for supporting us in NYC. If your company or local trade organization wants to host us in Boston, New York or Miami (or another city!), please email angelu[at]launch.co and let’s talk.

The post I’m on a Mission appeared first on Jason Calacanis.

Investor Stories 108: Strange & Unusual (Simoudis, Cheng, Kimmel)

by Nick Moran

On this special segment of The Full Ratchet, the following Investors are featured:

  • Evangelos Simoudis
  • Cheryl Cheng
  • Wayne Kimmel

Each investor describes the most unusual situation or pitch that they've encountered as an investor.

To listen more, please visit http://fullratchet.net/podcast-episodes/ for all of our other episodes.

Also, follow us on twitter @TheFullRatchet for updates and more information.

Investor Stories 108: Strange & Unusual (Simoudis, Cheng, Kimmel)

by Nick Moran

On this special segment of The Full Ratchet, the following Investors are featured:

  • Evangelos Simoudis
  • Cheryl Cheng
  • Wayne Kimmel

Each investor describes the most unusual situation or pitch that they've encountered as an investor.

To listen more, please visit http://fullratchet.net/podcast-episodes/ for all of our other episodes.

Also, follow us on twitter @TheFullRatchet for updates and more information.

15 Notes: How Data is Revolutionizing the NFL

by Marshall Kirkpatrick

I attended SXSW 2019 with my employer Sprinklr, and one of the sessions I got a lot out of was titled How Data is Revolutionizing the NFL.  I took notes on paper and now that I’m back in the office, I transcribed some of the most interesting notes from the session and thought I’d share them here.

I’m not a football fan, but I love data analysis, and this session was a lot of fun.  I think there’s a lot here that can be a source of inspiration for work in just about any sector, especially work that involves data.

* Each player has an individual game plan for each game (I didn’t realize that but of course it makes sense.  When I put my work to-do list on my calendar, that makes me feel a little like I’ve got an individual game plan in support of my team’s plan.)
* LA Rams analytics team has 3 people: a forecaster, a data architect, and a front end developer for internal systems.
* Whether it’s today or the 90’s before there were analytics teams, there have always been people looking at data, looking at probabilities, and trying to help teams make good decisions
* When you see players who are successful, you look to see if you can discover any new traits they have. Then you can look to find other people who have those traits as well but who may have missed other benchmarks and thus not been (Read more...)