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Timber! Out of the Woods: Why We Invested in a Startup With a New Approach to Logging

For me, the most exciting time to become involved in a startup is the very earliest of stages, when there is a vision and promise of what could be. Pre-product-market fit. Pre-product, even. That’s exactly when I met Zach Sherman and Ben Johnson of what would become Timber.

When we first talked, they didn’t have a prototype developed yet. They didn’t have an official name. They hadn’t even incorporated the company. In fact, they hadn’t even quit their previous jobs.

However, the two of them shared a vision of a cloud-based logging platform designed to help software developers get more done. One that offered developers context to their logs, centralizing and intelligently parsing to offer them the ability to click, filter, and search in real time. This system, enabled by the new capabilities of tools like Amazon Kinesis and Athena, would empower developers to quickly find whatever they needed, address Continue reading “Timber! Out of the Woods: Why We Invested in a Startup With a New Approach to Logging”

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When to make senior hires from $0 to 10M in revenue

One of the most frequent questions we discuss with portfolio companies is when to make which senior hires. The answer is driven by experience/skills of the founding team, trajectory, cash position, type and stage of the startup. Since the first four are very contextual, stage serves as a common denominator to define rules of thumbs. … Continue reading When to make senior hires from $0 to 10M in revenue

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a16z Video: What is the S-curve?

In this animated short video, a16z Partner Benedict Evans describes “the s-curve” in the life cycle of technology innovation, and why it’s important. Technologies like the PC, internet, and mobile phone emerge, grow, and mature in waves — from “a …

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a16z Podcast: From Mind at Play to Making the Information Age

Modern technology owes much to the introduction of the binary digit or “bit”, first proposed by Claude Shannon in “A Mathematical Theory of Communication”, a paper published in 1948. The bit would go on to transform analog to digital, making …

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20VC: What Metrics LPs Really Use To Measure Manager Success, Why 10 Year Fund Structures Really Do Not Work & Why Venture Is So Similar To The Movie Business with Will Porteous, General Partner @ RRE Ventures

Will Porteous is the General Partner & COO @ RRE Ventures, one of New York’s leading venture funds with investments in the likes of Buzzfeed, The Huffington Post, Giphy and Paperless Post just to name a few. As for Will, he works primarily with media and hardware companies, where he is a Director of BuzzFeed, Paperless Post, Spaceflight, and Spire. Prior to VC, Will held senior management positions with SupplyWorks and NetMarket, the e-commerce pioneer now owned by Cendant Corp.

In Today’s Episode You Will Learn:

1.) How Will made his entry into VC and came to be the hardware and media specialist as General Partner and COO @ RRE Ventures?

2.) Why does WIll believe VC is like the movie industry? How can VCs be prepared to movie producers? How does the talent required to make a great movie resemble that of making a great startup?

3.) Continue reading “20VC: What Metrics LPs Really Use To Measure Manager Success, Why 10 Year Fund Structures Really Do Not Work & Why Venture Is So Similar To The Movie Business with Will Porteous, General Partner @ RRE Ventures”

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VC/Founder partnerships and the cycle of destructive deduction and creative induction

I recently read Boyd (h/t and thanks to rands) and it got me thinking about the role of the founder and the VC in a successful partnership. There is a stark difference in the mindset and approach required for founders and VC’s to maximize their contribution to a company. Winning depends on each knowing their role and respecting the role of the other.

The founders I work with know that a critical part of my working style is knowing when to be quiet. I prefer to create silence, even awkward, uncomfortable pauses after a question or a reframing of a challenge because when founders step in and fill the gap in conversation, the quality of the discussion goes up. Every. Single. Time.

My job is to help take a mental model apart. I push founders to pull at the building blocks of the model in an effort to topple the

Continue reading “VC/Founder partnerships and the cycle of destructive deduction and creative induction”

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Local tech ecosystems: Stop comparing yourselves to Silicon Valley

From Silicon Alley to Silicon Beach, existing tech hubs and emerging ones long to be seen like the Valley: the self-proclaimed epicenter of all things tech. But why is that? When did living in San Francisco become a necessary prerequisite for being a startup founder or employee? As a New Yorker, I’m a bit biased to the Big Apple — the hustle and bu…Read More

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Local tech ecosystems: Stop comparing yourselves to Silicon Valley

From Silicon Alley to Silicon Beach, existing tech hubs and emerging ones long to be seen like the Valley: the self-proclaimed epicenter of all things tech. But why is that? When did living in San Francisco become a necessary prerequisite for being a startup founder or employee?

As a New Yorker, I’m a bit biased to the Big Apple — the hustle and bustle of the city and the intrinsic drive that people have here opposite of our laid-back counterparts in the Bay. There are hundreds of tech companies that make up our local ecosystem, yet we still seem to come second to San Francisco. A big blow to the empire state, but an even bigger blow to cities on the horizon.

Emerging hubs like Miami, Raleigh/Durham, Dallas, Nashville, Cincinnati, Detroit and others deserve the same effort, education, and access that we pour into the Bay. Tomorrow’s next tech leaders and talent Continue reading “Local tech ecosystems: Stop comparing yourselves to Silicon Valley”

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20VC: The Future Business Model For Drones & Why Enterprise Drones Need To Be As Boring As Possible with Jonathan Downey, Founder & CEO @ Airware

Jonathan Downey is the Founder & CEO @ Airware, the startup that allows you to make better-informed decisions with aerial date, captured by drones. They have raised over $65m in VC funding from some of the very best in the industry including a16z, Kleiner Perkins and Google Ventures just to name a few. Jonathan is also the General Partner @ Commerical Drone Fund, making $250K-$1m investments in early stage companies in the commercial drone space. Prior to Airware, Jonathan was a commercial pilot and a flight controls engineer @ Boeing.

 

In Today’s Episode You Will Learn:

1.) How Jonathan made the move from commercial pilot to startup founder with one of the hottest drone startups, Airware?

2.) What has been the catalyst for the rising belief in the potential for drones? What has changed about the landscape to make them now not only a commercially viable Continue reading “20VC: The Future Business Model For Drones & Why Enterprise Drones Need To Be As Boring As Possible with Jonathan Downey, Founder & CEO @ Airware”

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Hacking Sleep (Part 1)

My sleep habits for all practical purposes are about as perfect as real life permits. I excercise almost daily, I eat well, and I follow the old “early to bed early to rise” philosophy. I travel frequently, but if I’m at home, I’m dialed in.

However despite doing everything “right”, I noticed I was dragging in the mornings. Day after day. I would go to bed early and wake up before my alarm could go off. Solid 8-9 hrs of sleep. But still felt tired.

So I started doing some detective work:

Going to bed early (10pm) – check
Limiting screen time 1hr before bed – check
Limiting caffeine to before noon – check

These are the biggest items that can disrupt sleep, so I got my Sense sleep tracker set up again and started monitoring my sleep. Sense’s scale is 60s= Red 70s= Yellow, 80s+= green. The sensor looks at room conditions Continue reading “Hacking Sleep (Part 1)”

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Market Caps & The 2% Rule

One way to assess whether a startup idea is in a good market is to ask what are the market capitalizations of the biggest companies in that sector. For example in consumer internet, Google ($560 billion) and Facebook ($370 billion), and in enterprise software Microsoft ($460 billion), and Oracle, ($167 billion) are all large, high margin businesses.

Market caps in a pre-existing industry[1] tend to be proxies for the potential of the idea you are working on. There are three reasons for this:
1. The market capitalization of a set of companies reflects revenue in the market, growth rate of revenue and earnings, and the margins of the companies.
These core metrics used by wall street to value a stock are all metrics that help you understand whether a market is overall large, growing and profitable – all signs of a good market to enter.

2. Often, potential competitors Continue reading “Market Caps & The 2% Rule”

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SaaS Funding Napkin, the 2017 edition

Today is January 10, 2017. That means that in ten days, this jerk will become the leader of the free world. Ugh. It still feels surreal to me. In less earth shattering news, the fact that it’s 2017 also means that my “SaaS Funding in 2016” napkin needs an update.

As a reminder, in the original post I tried to give a “back of a napkin” answer to this question: What does it take to raise capital, in SaaS, in 2016? Today I’d like to take a stab at the (early) 2017 answer to that question.

Like in the 2016 version, the assumption is that the founding team is relatively “unproven”. Founders with significant previous exits can raise large seed rounds at high valuations early on, so the “rules” are different for them. On another note, when I say “what does it take to raise capital” I mean “what does

Continue reading “SaaS Funding Napkin, the 2017 edition”

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Dear Mr President , My Suggestion for Infrastructure Spending

I happen to be a fan of the government investing money into what is commonly called infrastructure projects.  I strongly believe that any reasonable businessperson, even one who works for the government, should be able to invest money at 1% interest rates and get a better than 2% return on taxpayer money. But I think its time to rethink how we spend a big chunk of that money.

If it was me spending the money, I would take 100 billion of the proposed $ 1 Trillion dollars in infrastructure investment and invest it in Robotics.

I would invest it in the companies that do R&D, software, and design for robots and every other facet of the Robotics Industry.

Unfortunately, none of the companies that actually make the robotics are based here in the USA. That’s a problem that needs to be solved.  We need to help develop domestic companies much like Continue reading “Dear Mr President , My Suggestion for Infrastructure Spending”

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The Melting Liquidation Preference

I’ve been through two severe market declines, both in 2001 and 2009. Public market volatility at the beginning of 2016 gave birth to a lot of “doom and gloom” posts on VC blogs. The public markets have recovered, but the scare earlier this year seems to have resulted in more conservative cash planning within early […]

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Should you take small checks from deep pockets?

So you’ve recently started a company, you’ve started to talk to angel investors and seed funds about your seed round, and suddenly a large VC appears on the scene and wants to invest. What should you do?

First of all, congrats. If a large fund wants to invest in your startup, that’s a great validation. Second, if you can get the brand, credibility, network and support of a Tier 1 VC into your startup early on, that can be extremely beneficial. So you should definitely consider it. It’s a complicated question, though, and you have to carefully consider the pros as well as the cons.

In this post I’ll try to shed some light on this question. As a disclosure and caveat, being a seed VC I’m not a disinterested observer, since we occasionally compete with bigger funds on seed deals. I’ll try to be as unbiased as possible, and

Continue reading “Should you take small checks from deep pockets?”

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GOAT: In Defense of the Pivot

The “pivot.” If you spend much time in the VC industry or reading tech press, it starts to sound like a cliche. Like a punchline. A last, desperate scramble to make something out of a business that, rightly or wrongly, couldn’t make their model work the way originally thought or how early metrics had indicated it might.

And when you’re surrounded by examples of failed pivots, it can be easy to become jaded about them. For every successful pivot like a Twitter, Instagram, or Slack, there are countless others, high profile and low profile, that never managed to find product-market fit and simply ran out of runway.

I sometimes say be careful with pivots, as the referee will blow the whistle for traveling. You can lose your key players, key coaches and influential fans and supporters. And yet, sometimes that pivot can create a clear path to the basket leading to

Continue reading “GOAT: In Defense of the Pivot”

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Who is #LongLA?

This is a list of known firms and individuals with a home base or whose investment focus includes Southern California. It includes Accelerators, Angels, Corporate VCs, Family Offices, Hedge Funds, Seed Funds and Traditional VCs.

The list was inspired by @shaig‘s seed fund google doc. Tweet or comment additions, corrections or deletions. “Home base” definition and right to add is at my discretion. Investors w/ known funds are listed under Fund Name (ie: Matt Mazzeo via Lowercase Capital and Michael Eisner via Tornante Company)

Google Doc is accessible here. Originally created July 5, 2014 and has been modified many times.

#LongLA Tech Investor List

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Imaging, Snapchat and mobile

For the first time, pretty much everyone on earth is going to have a camera. Over 5bn people will have a mobile phone, almost all will be smartphones and almost all will have cameras. Far more people will be taking far more photos than ever before – even today maybe 50-100 times more photos are taken each year than were taken on film. 

Talking about ‘cameras’ taking ‘photos’, though, is a pretty narrow way to think about this – rather like calling those internet-connected pocket supercomputers ‘phones’. Yes, the sensor can capture something that looks like the prints you got with a 35mm camera, or that looks like the footage a video camera could take. And, yes, it’s easier to show those images to your friends on the internet than by post, and easier to edit or crop them, or adjust the colours, so it’s a better camera. But Continue reading “Imaging, Snapchat and mobile”

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News Roundtable! Ari Levy, CNBC & Rolfe Winkler, WSJ: Walmart & Jet, Google & anti-trust, Uber & China, Elon & Energy, CEOs & bad behavior

Hi everyone, Producer Jacqui here. Ari Levy of CNBC and Rolfe Winkler of The Wall Street Journal joined @Jason for a must-see News Roundtable on This Week in Startups. An amazing discussion that kicked off with big deal of the week, Walmart snapping up Jet.com for $3b, that crackled on to Google, the government, anti-trust, the entire U.S. debt problem, the Chinese Market, the very future of energy (featuring, naturally, Elon), and the latest in startup CEOs behaving badly. And more.

[ Click to Tweet (can edit before sending): http://ctt.ec/00i8b ]

Subscribe in iTunes: http://bit.ly/TWiSTAV

And watch here! 🙂

Some key discussions
M&A

The big deal of week is Jet.com being bought for $3B by Walmart. What’s behind the deal? Walmart.com has been around since 2000 and has never bridged the gap with Amazon, remaining the #2 player in e-commerce. Could Jet.com & CEO Marc Lore be the Continue reading “News Roundtable! Ari Levy, CNBC & Rolfe Winkler, WSJ: Walmart & Jet, Google & anti-trust, Uber & China, Elon & Energy, CEOs & bad behavior”

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Trump

This post is by from Sam Altman

I’m going to say something
very unpopular in my world: Trump is right about some big things.

He’s right that many
Americans are getting screwed by the system. 
He’s right that the economy is not growing nearly fast enough.  He’s right that we’re drowning in political
correctness, and that broken campaign finance laws have bred a class of
ineffective career politicians.  He may even be right that free trade is
not the best policy.  Trump supporters
are not dumb.

But Trump is wrong
about the more important part: how to fix these problems.  Many of his
proposals, such as they are, are so wrong they’re difficult to even respond to.

Even more dangerous,
though, is the way he’s wrong.  He is not merely irresponsible.  He
is irresponsible in the way dictators are.

Trump’s casual
racism, misogyny, and conspiracy theories are without precedent among major presidential
nominees.  He has said that a judge of
Mexican descent isn’t treating him fairly because of his heritage and that we
should ban Muslims from entering the country.

When his supporters
beat up a homeless Hispanic man and cited Trump, he called them “very
passionate”.  He has accused Obama of somehow being
responsible for the recent shooting in Orlando.

To anyone familiar
with the history of Germany in the 1930s, it’s chilling to watch Trump in
action.  Though I know intellectually it’s easy in hard economic times to
rile people up with a hatred of outsiders, it’s still surprising Continue reading “Trump”