Venture Trends Newsletter, Issue #7
This newsletter gathers together this week’s most interesting content related to the Venture capital ecosystem. I read every day and this is curated from my weekly reading. I help startups tell their story at https://archimedes.studio
I email the newsletter on Saturday, Pacific time, each week. There is little or no commentary included, it is the things I found compelling or interesting.
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This week’s paid version is here — Venture Trends for Paid Subscribers
Stories in the paid version this week:
- How to prepare your startup for a seed round
- How to present user growth and revenue growth
- Where do VCs recruit talent?
- Are Seed rounds getting bigger?
- Venture Capital as an Algorithm
- Is your startup ready for Venture funding?
In this week’s free issue there are some amazing things to highlight.
- How to Raise a Series A Round, from Y Combinator
- How to design a pitch deck (design not content)
- Softbank partners try to trap colleague in sex tryst
- Hard and Easy Startups by Sam Altman
- Thinking like a screenwriter to attract funding
- Shopify mints new Billionaires
- Angel Investing — is it a status symbol?
- The future of Sequoia — Doug Leone Interview
How to Design a Better Pitch Deck
Y Combinator / Saved by Keith Teare
It’s better, but there’s lots of other text on this slide that’s not optimized for legibility because we’ve allowed the screenshot to be a constraint.The following is an adaption of a presentation I give to YC startups before we have them create their presentation slide decks for Demo Day.
How to Raise Money — It’s a Journey Not An Event
200+ Steve Blank / Saved by Keith Teare
In the seed round you have an early product and by the end you’ve found product/market fit and understand the scale of what you’re building and the levers that you can pull to accelerate growth.You (think) you have product-market fit with real customers and real revenue and need money to grow and expand.
YC’s New Guide to Raising a Series A
200+ Y Combinator / Saved by Keith Teare
While we couldn’t work directly with every company in the world trying to raise an A, we realized that publicly distributing our learnings would help all founders.This guide collects nearly everything we’ve learned about Series A’s.
The Inside Story of How This Startup Turned a 216-Word Pitch Email into a $2.6 Billion Acquisition
First Round / Saved by Keith Teare
Drawing on their unique perspectives as founding CTO , engineering leader , CEO and first investor , respectively, they unpack Looker’s recipe for success from every angle, sharing an inside look at why it worked, how the business was built, and what other startups can learn from its early days.This crew covers all the essential cogs in the startup machine: finding the idea, standing out in the market, experimenting with different models, scaling sales, nailing customer success, and of course, assembling a winning team.
The Unit Economics of Corporate Venture Capital
Venture Desktop / Saved by Keith Teare
Starting small aligns the venture organization with a corporate’s business units, enables a market-informed strategy to take root and prioritises a focus on developing the right “product” — all of which serve to create a solid foundation upon which to build a venture-enabled growth strategy that persists and drives value over the long term.In a market where the median CVC fund size has exceeded $75m every year since 2014 and the median assets under management (AUM) for active CVC units is edging towards $200m, a recent recommendation by 500 Startups — $50m as the minimum commitment required to build out a “useful” corporate venturing initiative — hardly seems like enough to make an impact.
20VC: Gusto Co-Founder, Tomer London on Why Most Founders Approach Fundraising With The Wrong Mindset Today, How To Construct A Values/Motivation Alignment Test To Determine The Right Investors For You
The Twenty Minute VC: Venture Capital | Startup Funding | The Pitch / Saved by Keith Teare
With 111 investors on the Gusto cap table, what would Tomer advise founders when it comes to cap table management?4.) What have been Tomer’s biggest learnings when it comes to building a delightful product at scale across different segments?
Countries that have benefited most from globalisation are the most fearful of change
300+ Graphic detail / Saved by Keith Teare
In the 20 countries surveyed by Ipsos over the past six years, 56% of respondents, on average, think that globalisation is good for their country, up from 49% in 2013.We find that for the 34 countries surveyed by Ipsos, the correlation between growth in GDP per person between 2008 and 2018 and our drawbridge index is 60%.
How Tesla Sets Itself Apart
7K Harvard Business Review / Saved by Keith Teare
But it’s my experience as a three-time software company CEO that makes it increasingly clear to me that the company’s innovative business model represents an existential threat to the auto industry as a whole.How so?And its soaring market valuation is a clear sign to all automakers that they’ll need to develop more innovative, Tesla-like business models in order to survive.
Ranked: The Most Innovative Economies in the World
400+ Visual Capitalist / Saved by Keith TeareThe European nation scores in the top five for its manufacturing value-added, high-tech density, and patent activity metrics.Based on available data of these measures, only 105 countries made the final cut for this year’s edition of the index — below are the 60 most innovative economies scored out of 100 points, and the highlights from that list.
Traditional Late Stage VC is Being Disrupted. Here’s how.
The Startup — Medium / Saved by Keith TeareLate stage venture investing has long held a broad appeal to a wide swath of investor types: from pure-play late stage VC firms, to corporates and strategics, to non-traditional types such as Sovereign Wealth Funds (SWFs), family offices and financial investors typically known for focusing on other asset classes, such as hedge funds and real estate.Finally, and perhaps most controversially, there’s been a trend in recent years of syndicates of seed and early stage investors choosing to continue funding their breakout companies themselves rather than, as they once did, taking their best companies to late stage institutional firms when growth stage capital is required.
Why venture capital needs to stop hunting unicorns
GrowthBusiness.co.uk / Saved by Keith Teare
The numbers initially look bleak for early stage start-ups: there were 1,648 VC investments in the UK in 2019, but most of them were driven by later stage deals in the healthcare and fintech sectors.Is investment in early and seed stage businesses increasingly falling away in favour of later stage deals?
Keith Rabois Interviewed by Dan Primack
Upfront Ventures / Saved by Keith Teare
Keith Rabois of Founders Fund sits down with Dan Primack of Axios to discuss making big bets in venture, how Founders Fund operates as a partnership with unique perspectives, and his views on the upcoming election cycle.
Former Apple Ad Guru Becomes ‘Storyteller’ for Tech Founders
4 The Information / Saved by Keith Teare
James Vincent helped Steve Jobs come up with some of Apple’s most memorable advertisements, from its Mac versus PC commercials to an iPod campaign featuring dancing silhouettes. More recently, Vincent has turned himself into a brand whisperer to some of the most prominent companies in tech and media, including Snap, Vice Media and Airbnb.
London-based Gyana raises $3.9M for a no-code approach to data science
300+ Fundings & Exits — TechCrunch / Saved by Keith Teare
Coding and other computer science expertise remain some of the more important skills that a person can have in the working world today, but in the last few years, we have also seen a big rise in a new generation of tools providing an alternative way of reaping the fruits of technology: “no-code” software, which lets anyone — technical or non-technical — build apps, games, AI-based chatbots, and other products that used to be the exclusive terrain of engineers and computer scientists.Das said they have also identified this, and so while currently Gyana already offers some tutorials and helper tools within the app to nudge the user along, the plan is to eventually bring in a large variety of datasets for people to get started with, and also to develop a more intuitive way to “read” the basics of the files in order to figure out what kinds of data inquiries a person is most likely to want to make.
The Venture Capital Math Problem Revisited (aka How Could You Be So Wrong?)
28 VC & Technology — AVC / Saved by Keith Teare
The venture capital business has been raising north of $50bn per year for much of the last decade and so far, the returns continue to look quite good.In that post, I argued that the venture capital business could not sustain more than $20bn a year of new capital coming into it and continue to produce good returns to the investors in VC funds.
Now this is partnership dynamics: Mr. Benedetti sent a team to Tokyo to set up the so-called honey trap, in which one or more women would lure Mr. Arora to a hotel room rigged with cameras in an attempt to obtain compromising images
500+ @annimaniac Tweets / Saved by Keith Teare
Investing in Roblox
30 Andreessen Horowitz / Saved by Keith Teare
Over 2 million developers are actively creating on the platform, and many are building serious businesses that exist entirely within the world of Roblox.Because all they need to bring is a great idea, Roblox empowers their community to create the games — really, immersive worlds — that they want to play in, especially as the company continues to invest in more advanced play and in becoming the premier graphics engine.
Why Your Startup’s Org Chart is Limiting Your Growth
4 Tomasz Tunguz / Saved by Keith Teare
The reason middle managers are key is they cut the span and control and defray the recruiting responsibility, freeing leaders to spend time running the company.As a startup evolves from product market fit to scaling, organizational design becomes an executive imperative.
Want To Attract Venture Capital? Think Like A Screenwriter.
13 Forbes / Saved by Keith Teare
“People need to be more like Tim,” says Van Espahbodi, co-founder and managing partner of Starburst, the largest aerospace innovation hub for startups.Tim Ellis Has Taken Rocket Company Relativity to New Heights With Vision and Savvy Storytelling
500+ Sam Altman / Saved by Keith Teare
Easy startups are easy to start but hard to make successful. The most counterintuitive secret about startups is that it’s often easier to succeed with a hard startup than an easy one.
London venture capital leads Europe as it doubles funding
11 City A.M. / Saved by Keith Teare
London led venture capital deals across Europe last year as it doubled its funding and the amount raised in the UK hit a record high.In 2019, London-based companies more than doubled the amount of venture capital raised from £2.5bn in 2018 to £5.6bn, according to research by Refinitiv.
Crypto-friendly Revolut is now UK’s most valuable FinTech company
39 Decrypt / Saved by Keith Teare
Revolut, a so-called “challenger” bank that operates out of London’s Canary Wharf, has raised $500 million in a Series D funding round, bringing its total valuation to $5.5 billion.Some, like Revolut, as well as upcoming challenger bank Ziglu (founded by a former co-founder of Starling), let customers buy cryptocurrencies, such as Bitcoin and Ethereum , within their apps.
Spending Time on an Advisory Board Is A Waste
31 Points and Figures / Saved by Keith Teare
If you read the thread, you will see a lot of opinions on advisory boards and most aren’t good. This may be irrational, but startup companies having well-known non-entrepreneurs on their ‘advisory’ board is always a red flag to me
RT @edsim: 1/ So you’re a founder having just closed your seed and Series A firms are banging down your doors. Please don’t get false signals
26 @robgo Tweets / Saved by Keith Teare
Private Equity and VC Managers ‘Amazed at How Damn Easy It is to Make Money’
17 Institutional Investor / Saved by Keith Teare
Ninety-five percent of investment professionals, advisors, and vendors reported self-confidence in a new survey from Semaphore, an advisory firm hired by limited partners to take over troubled private equity, venture capital, and hedge funds.Respondents felt more charitably toward the CEOs and managing partners of their competitors, with 69 percent expressing confidence in their abilities.
Stanford’s Strebulaev: Tech Unicorns’ Valuations Are Fairy Tales
Poets&Quants / Saved by Keith Teare
Strebulaev of the Stanford Graduate School of Business, finds that market values of many of these unicorns are, well, mythical.Strebulaev of the Stanford Graduate School of Business is Poets&Quants’ Professor of the Week
Investors want to tranche a $1M seed round in 3 stages. Can I protect against them freezing remaining installments?
4 SaaStr / Saved by Keith Teare
Q: Investors want to tranche a $1M seed round in 3 stages.The post Investors want to tranche a $1M seed round in 3 stages.
The Untold History of Facebook’s Most Controversial Growth Tool
Medium / Saved by Keith Teare
(Zuckerberg did not mention his early cogitations in the Book of Change about dark profiles.) In a more elaborate explanation provided later, Facebook said, “We do not create profiles for non-Facebook users,” though it also says it keeps certain data, like what device and operating system version a nonuser has, for things like “optimizing registration flow for the specific device” should someone decide to join.Exposing potential friends is a way to improve a member’s experience; it increases the chances they will share more, and, most of all, it makes people less likely to bail on Facebook.
$19.8B Invested In Agri-FoodTech In 2019 According To AgFunder
28 Crunchbase News / Saved by Keith Teare
The largest growth year over year in funding includes meat alternatives, indoor farming, robotic food delivery and cloud kitchens.The largest sector decline is food delivery by 56 percent year over year.
Venture capital investor Lakestar raises $735 mln for Europe bets
4 Reuters / Saved by Keith Teare
BERLIN, Feb 25 (Reuters) — Venture capital investor Lakestar said on Tuesday it had raised a total of $735 million for early- and growth stage funds that will invest mainly in Europe, while adding new faces to its top leadership team.Venture capital firm Atomico said last week it had closed its fifth fund with $820 million to invest in early-stage technology companies in Europe, saying the region had come of age in terms of innovation and opportunity.
Shopify’s Soaring Stock Creates Fistful Of New Billionaires
100+ Forbes / Saved by Keith Teare
The newest additions to the angel investor Hall of Fame are a little-known husband and wife from Toronto, who are now each worth $1 billion thanks to a small investment they made 13 years ago in Shopify, a software platform that helps small and mid-sized businesses launch and manage their online stores.John Phillips, a 68-year-old retired lawyer and his wife Dr. Cathy Phillips, a psychologist who specializes in helping cancer patients deal with stress, have turned their $750,000 investment in Shopify into a $2 billion fortune simply by sitting on its stock.
For Silicon Valley tech tycoons, angel investing is a status symbol
Los Angeles Times / Saved by Keith Teare
“They tend to take more risk with angel portfolios and don’t really track them or worry about them,” says China, whose company is part of Silicon Valley Bank, a big lender to start-ups and venture capital funds.Jennifer Forster, a partner at San Francisco-based wealth manager Epiq Capital Group, says investors recently have been able to sell shares at high prices in secondary markets, allowing them to cash out significant portions of their stakes.
If there’s truly an extended downturn, know most VCs have 3 categories for their portfolio
1. things going great, let’s double down
2. too early to tell but promising, let’s make current capital last longer
3. sorry friend, you’re on your own know which category you’re in
Crypto-friendly fintech firm Revolut raises $500M at a $5.5B valuation
The Block / Saved by Keith Teare“We’re on a mission to build a global financial platform — a single app where our customers can manage all of their daily finances, and this investment demonstrates investor confidence in our business model,” said Revolut founder and CEO, Nik Storonsky.Crypto-friendly investing app provider Revolut has raised $500 million in a Series D round that values it at $5.5 billion.
The Strategic Importance of Competition
12 Tomasz Tunguz / Saved by Keith Teare
Sellers and marketers need to spend millions of dollars to create a category.But it’s far more common to see a collection of founders band together and pool their capital to create the category.
20VC: Vinod Khosla on What Venture Assistance Really Means, Why Many VCs Are Not Qualified To Advise Founders & Why Startups Can Innovate So Much Faster Than Incumbents
The Twenty Minute VC: Venture Capital | Startup Funding | The Pitch / Saved by Keith Teare1.) How Vinod made his way into the world of startups with the founding of Daisy and Sun Microsystems and how that led to his entry into the world of venture with KPCB and ultimately founding Khosla Ventures?How does Vinod allocate his time to drive as much value for the portfolio as possible?
The 14 most active VCs in European fintech revealed
30 Sifted / Saved by Keith Teare
The data shows that the main early-stage financiers come from venture capital firms in the UK and Germany; incidentally, the countries that also receive the most fintech funding overall.The following ranking reveals the most-active venture capital firms in early-stage European fintechs between 2015 and 2019.
Startup loans for marketing money: A threat to VC?
30 Sifted / Saved by Keith Teare
Recently, a number of founders have eschewed venture capital funds and chosen different paths for themselves and their companies.Marketing advances pose a challenge to the economics of venture capital firms that may well be near, if not present.
As the Start-Up Boom Deflates, Tech Is Humbled
4K The New York Times / Saved by Keith Teare
Their rise was propelled by a wave of investor money — about $763 billion washed into start-ups in the United States over the last decade — that also fueled the growth of young companies in delivery, cannabis, real estate and direct-to-consumer goods.Investments in young companies have fallen, with 2,215 start-ups raising money in the United States in the last three months of 2019, the fewest since late 2016, according to the National Venture Capital Association and PitchBook, which track start-ups.
Interview with Doug Leone from @sequoia on firms history and future
39 @eladgil Tweets / Saved by Keith Teare
Doug: We’re going to talk a lot about Sequoia during your time and its evolution, but before we do, we want to ask you to tell your story a little bit.
David: Doug is the global managing partner of Sequoia Capital, in charge of overseeing the firm’s many diverse businesses, which we will get into, from seed to global growth investing across the US, India, and China.
Do You Consider Yourself a Leader or a Manager? Here’s Why Both Are Critical to Your Bottom Line
The Startup — Medium / Saved by Keith Teare
But in a follow-up article published in 1990, What Leaders Really Do , Harvard Business School professor John Kotter makes that case that, while management and leadership are different, they’re both extremely important.Managers focus on organizing and staffing, while leaders focus on “aligning people” (which basically means communicating a new idea and helping them organize in a way that makes sense)
I had never heard the term “far analogies” before, but found it immediately compelling. KH argued that the best & the brightest were able to borrow ideas from fields that were further away from their own craft. He even argued this might be a tier of intelligence, & gave examples.
When Entrepreneurial Passion Backfires — Harvard Business Review
Researchers surveyed 107 tech teams participating in an accelerator program, and found that diversity of passion among individual team members — in terms of how passionate they are, and what they’re passionate about — had a negative relationship with team performance, due to conflicting emotions and identities within the team.By conducting surveys with 107 tech teams participating in an accelerator program, we found that diversity of passion among individual team members — in terms of how passionate they are, and what they’re passionate about — had a negative relationship with team performance, due to conflicting emotions and identities within the team.
RT @dksf: “He’s a conviction investor, not an indexer!” Was doing a reference call for a founder about @tonsing and that was just what came out
Authentic Demand’s Role in Startup Success
When we started Pardot , we believed there was authentic demand, but we didn’t really know.The most successful entrepreneurs uncover authentic demand in a fast-growing market and deliver a stellar product.