My first post on this blog was on September 17, 2008, a week into the 2008 crisis, and I honestly did not expect to be posting for long, anticipating that after a few posts, that crisis would be behind us, and that we could go back to our lives. That of course turned out not to be the case, as the crisis not only extended for months, but left its imprint on almost everything market or economy related for the next decade. Almost twelve years later, and six weeks into another market crisis, I have a sense of deja vu, as the days of volatility stretch into weeks, and each week brings new surprises. Unlike my four previous updates, this one will describe a week of market recovery, at least in sum, but like the previous weeks, the increase in market values came with wide swings, and continued uncertainty and volatility. It was also a week that saw governments around the world rush to pass rescue packages designed to get both individuals and businesses through a period where the global economic machine has been shut down. These bailouts, in addition to being many times larger than prior bailouts, have also reignited debates about what governments should be demanding in return. In the United States, a central issue that is being argued is how much stock buybacks done by companies in the last decade are contributing to the pain that companies are facing, and whether there need to be restrictions on (Read more...)
My first post on this blog was on September 17, 2008, a week into the 2008 crisis, and I honestly did not expect to be posting for long, anticipating that after a few posts, that crisis would be behind us, and that we could go back to our lives. That of course turned out not to be the case, as the crisis not only extended for months, but left its imprint on almost everything market or economy related for the next decade. Almost twelve years later, and six weeks into another market crisis, I have a sense of deja vu, as the days of volatility stretch into weeks, and each week brings new surprises. Unlike my four previous updates, this one will describe a week of market recovery, at least in sum, but like the previous weeks, the increase in market values came with wide swings, and continued uncertainty and volatility. It was also a week that saw governments around the world rush to pass rescue packages designed to get both individuals and businesses through a period where the global economic machine has been shut down. These bailouts, in addition to being many times larger than prior bailouts, have also reignited debates about what governments should be demanding in return. In the United States, a central issue that is being argued is how much stock buybacks done by companies in the last decade are contributing to the pain that companies are facing, and whether there need to be restrictions on (Read more...)
Community experts, go-to-market leaders and founders everywhere are facing a new challenge: quickly spinning up virtual events and online communities that feel unique and valuable. Whether you’re tasked with energizing your existing community, pivoting your company’s event programming, scrambling to spin it all up for the first time — or just trying to hold a really great virtual happy hour — community expert David Spinks offers a wealth of wisdom drawn from over a decade spent deepening the moat of community.
Earlier this month, a group of U.S. Senators led by Amy Klobuchar introduced the New Business Preservation Act to incentivize venture capital formation around the country. The Act, which allocates $2 billion to states under the “Innovation and Startups Equity Investment Program,” enables investors in undercapitalized regions to leverage federal dollars into startup investments. It avoids two well-known traps for government-sponsored venture programs by requiring that public funds are matched with private dollars and that capital is deployed by professional investors.
The Act also continues a long-standing tradition of U.S. federal government involvement in the formation and development of the venture capital industry.
Although many of its modern inhabitants don’t like to admit it, Silicon Valley owes much of its existence to the U.S. federal government. That is not to say that Silicon Valley isn’t the product of human ingenuity and agency. Clearly, it is. Some of the hardest working and most brilliant minds on the planet have been shaping the world’s leading innovation ecosystem for decades. But that doesn’t change the fact the U.S. government played a decisive role in getting the whole thing kickstarted, and for a period of time, sustained its development in the early stages.
The clearest mechanism for this support was wartime expenditures on research and development by the U.S. Department of Defense during World War II and the Cold War that followed. This “mission-driven state” generated enormous demand for computing and communications technologies, which shaped entire industries around Boston and Silicon Valley. As venture capitalist and economic historian (Read more...)
Earlier this month, a group of U.S. Senators led by Amy Klobuchar introduced the New Business Preservation Act to incentivize venture capital formation around the country. The Act, which allocates $2 billion to states under the “Innovation and Startups Equity Investment Program,” enables investors in undercapitalized regions to leverage federal dollars into startup investments. It avoids two well-known traps for government-sponsored venture programs by requiring that public funds are matched with private dollars and that capital is deployed by professional investors.
The Act also continues a long-standing tradition of U.S. federal government involvement in the formation and development of the venture capital industry.
Although many of its modern inhabitants don’t like to admit it, Silicon Valley owes much of its existence to the U.S. federal government. That is not to say that Silicon Valley isn’t the product of human ingenuity and agency. Clearly, it is. Some of the hardest working and most brilliant minds on the planet have been shaping the world’s leading innovation ecosystem for decades. But that doesn’t change the fact the U.S. government played a decisive role in getting the whole thing kickstarted, and for a period of time, sustained its development in the early stages.
The clearest mechanism for this support was wartime expenditures on research and development by the U.S. Department of Defense during World War II and the Cold War that followed. This “mission-driven state” generated enormous demand for computing and communications technologies, which shaped entire industries around Boston and Silicon Valley. As venture capitalist and economic historian (Read more...)
Experts on the COVID-19 pandemic seem to think there are three ways out—that is, for life, health, and the economy to return roughly to normal.
Either we get a vaccine good enough that R0 for the world goes below 1, a good enough treatment that people no longer need to be afraid, or we develop a great culture of testing, contract tracing, masks, and isolation.
I wish that the federal government were doing much more—it would be great to see even a few percent of the recent stimulus bill go to funding R+D. But they don’t seem to be funding enough science, and although I think concerns about the private sector and philanthropy doing what the government is supposed to be doing are somewhat valid, there isn’t a great alternative right now.
On the positive side, I have never seen a field focused on one problem with such ferocity before. The response of biotech companies and research labs is amazing, and the speed they are operating at seems to have increased by more than 10x. It’s the best of the spirit of innovation, and it’s inspiring to see what these companies and research labs are doing.
Scientists can get us out of this. What they need are money and connections.
Investors and donors—this is where we can help. Please consider shifting some of your focus and capital to scientific efforts addressing the pandemic. (And future pandemics too—I think this will be a before-and-after moment in the world, and until we (Read more...)
Experts on the COVID-19 pandemic seem to think there are three ways out—that is, for life, health, and the economy to return roughly to normal.
Either we get a vaccine good enough that R0 for the world goes below 1, a good enough treatment that people no longer need to be afraid, or we develop a great culture of testing, contract tracing, masks, and isolation.
I wish that the federal government were doing much more—it would be great to see even a few percent of the recent stimulus bill go to funding R+D. But they don’t seem to be funding enough science, and although I think concerns about the private sector and philanthropy doing what the government is supposed to be doing are somewhat valid, there isn’t a great alternative right now.
On the positive side, I have never seen a field focused on one problem with such ferocity before. The response of biotech companies and research labs is amazing, and the speed they are operating at seems to have increased by more than 10x. It’s the best of the spirit of innovation, and it’s inspiring to see what these companies and research labs are doing.
Scientists can get us out of this. What they need are money and connections.
Investors and donors—this is where we can help. Please consider shifting some of your focus and capital to scientific efforts addressing the pandemic. (And future pandemics too—I think this will be a before-and-after moment in the world, and until we (Read more...)
This post is by Nick Moran from The Full Ratchet: VC | Venture Capital | Angel Investors | Startup Investing | Fundraising | Crowdfunding | Pitch | Private Equity | Business Loans
Chris Douvos of Ahoy Capital joins Nick on a special Crisis Coverage installment to discuss the LP Lessons from '01 and '08, The Denominator Effect, Capital Calls & Fundraising in a Down Market. In this episode, we cover:
- What is the denominator problem/effect?
- Why does it matter?
- How do LPs react when they face the denominator problem?
- How quickly do LPs tend to rebalance their investment portfolio?
- What's the implication to VCs?
- How should VCs react when their investors face the denominator problem?
- LPs lose access to future funds if sell position as secondary?
- When VCs make capital calls at times like these, what's the ripple effect down the line for these LPs?
- What were some of the typical LP reactions you've seen from the dot com bubble and the 2008 crisis, that you expect to see again?
- Can you talk more about the thought process of LPs during a crisis like this? Are they rushing to liquidate? Are they putting that money somewhere else?
- VC capital calls - guidance?
- What's the impact on VCs that are fundraising?
- What type of VCs have had success raising in a down market?
- What are some best practices/principles for managing LP relationships in a time like this?(Chris was in PE, as Co-head of PE Investing at the Investment Fund for Foundations in 2008 crisis)
- What was the biggest lesson you've learned from previous crises in 2001 and 2008?
- VC's metrics are dependent on the market, like PME. What's the impact of the current (Read more...)
This post is by Nick Moran from The Full Ratchet: VC | Venture Capital | Angel Investors | Startup Investing | Fundraising | Crowdfunding | Pitch | Private Equity | Business Loans
Chris Douvos of Ahoy Capital joins Nick on a special Crisis Coverage installment to discuss the LP Lessons from '01 and '08, The Denominator Effect, Capital Calls & Fundraising in a Down Market. In this episode, we cover:
- What is the denominator problem/effect?
- Why does it matter?
- How do LPs react when they face the denominator problem?
- How quickly do LPs tend to rebalance their investment portfolio?
- What's the implication to VCs?
- How should VCs react when their investors face the denominator problem?
- LPs lose access to future funds if sell position as secondary?
- When VCs make capital calls at times like these, what's the ripple effect down the line for these LPs?
- What were some of the typical LP reactions you've seen from the dot com bubble and the 2008 crisis, that you expect to see again?
- Can you talk more about the thought process of LPs during a crisis like this? Are they rushing to liquidate? Are they putting that money somewhere else?
- VC capital calls - guidance?
- What's the impact on VCs that are fundraising?
- What type of VCs have had success raising in a down market?
- What are some best practices/principles for managing LP relationships in a time like this?(Chris was in PE, as Co-head of PE Investing at the Investment Fund for Foundations in 2008 crisis)
- What was the biggest lesson you've learned from previous crises in 2001 and 2008?
- VC's metrics are dependent on the market, like PME. What's the impact of the current (Read more...)
Herewith a briefing on all things “television” which is now called streaming video, Live TV, and a bunch of other things, including confusing.
For a friend, I recently took on the task of trying to provide an overview of this new, broadband world of streaming video. She has an older-model television and generally uses it to watch DVDs rented from Netflix. (Yes, Netflix does still maintain their original DVD rental-by-mail service; as of a year ago Netflix had 2.7M customers for that service, which is available for $7.99/month; I couldn’t find a more-recent customer number for 2020.)
I started with the devices that plug into a physical television. Your phone, tablet, and game consoles can also act as a “television”, for which you need to download an app and then review the streaming services themselves, which I review below.
Now onto devices that you plug in to get streaming video on your TV set:
Roku: Roku is a device that you buy from lots of places, this one from BestBuy for $40. Once you have the device, this is how they explain how it works. You buy it, plug it in, pair it to the WiFi network, and start using it. No service charge from Roku, but they do pass through the fee the service charges if you sign up through Roku. (If you already have Netflix or Amazon Prime Video, you just need to sign into your existing account.) It is most likely that your existing TV (Read more...)