12 companies, 7 exits, $75M raised, angel on the other side. I write about building, money, travel and whatever I am chewing on that week.
Joined February 2008
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when there is a lot of money the easy answer to every problem is to hire someone, and then nobody on the team really understands the problem
Revolut CEO Nik Storonsky says easy money makes soft founders:
“A lot of founders think money is free, which it almost is in California because you can raise so much money at ridiculous valuations and then just spend.”
“There is a different culture of trying to solve problems with money rather than with your brains.”
cofounders should talk about salary and equity and who has the final say before they start. it is a much easier conversation when there is nothing to split yet
I think it is easier to keep going through a bad year when you like the work itself. the money alone is not enough for most people
consumption revenue can drop fast if customers move to a cheaper model but the compute contracts stay the same. I think that is what public investors will ask about first
I don't think everything matters the same. if you treat every small thing as big you are tired by the time something actually big shows up
saying it early is the one I care about. I can work with a bad quarter but if I hear it from someone else first it is hard to trust the numbers after that
I used to envy a few founders who looked like they had it easy. when I got to know them they had the same problems as me and some had worse ones
My number one rule for jealousy: Call of Duty vs War.
Call of Duty: If I'm imagining someone's life from the outside, I'm not allowed to envy it. I'm playing a simulation of the real thing.
War: If I've spent two weeks living alongside them, seen the boring bits, the ugliest bits, and still want their life? Now I'm allowed to be jealous.
Jealousy is useful information. But only when it's based on reality. And if I use it as fuel to improve myself, rather than tear that person down.
the lenders want to know who is renting the GPUs in 2 years and for most neoclouds the answer is other AI startups. so I'm not surprised the debt dried up
I think a lot of small sites just go behind a login. that is cheaper than paying for security every month and it means less of the internet is open
a hired CEO who makes a big bet and gets it wrong loses the job and if it works the shareholders get most of it. so I don't really blame them for playing it safe
Revolut CEO Nik Storonsky on why it’s easier for founders to build great businesses than professional CEOs:
“Professional CEOs optimize certain metrics, but they’re not 10X people.”
“They're just there for their bonuses effectively for 3-4 years. As a result, they don't make bold decisions. They always play defense. They never play offense.”
“Professional CEOs, ultimately their goal is to protect their job. They think about themselves and the company as two entities. I think about myself and the company as one entity.”
“It's much easier to compete against non founders. If I would be competing with all the banks and they were all founder-led, as a world, we would all have much better products by now. That's not what's happening.”
I don't think software goes away in 20 years but it gets a lot cheaper to build, so I think the margin goes to whoever owns the customer
Are software investors f***ed?
“If you are a pure software investor, you are kind of fucked. SaaS, I do not think, is going to be where you gain margin anymore.
SaaS was massive fragmentation of the market because the delivery mechanism became very easy and frictionless.
Now applications are starting to become more about the intelligence layer, and I just do not see software being a huge market in 20 years.” @NaveenGRao
Love to hear your thoughts @jasonlk @jaminball @ttunguz @poyark
people will go along with a lot of big changes but not one that touches what they do every day without thinking. 16 months is longer than I would have guessed
Six polite Series A passes show up in almost every stalled raise: "not our thesis," "too early," "keep us posted," "more traction," "market size," and "we're not leading."
Each one usually points at something real in the business: revenue quality, retention, customer concentration, burn, the sales motion, or the shape of the round.
I wrote up how to tell which one you're actually hearing, and what to fix before the next raise:
fundingdx.com/journal/not-ou…
Mash Bonigala retweeted
There is nothing to worry about.
Nothing important is run on PHP or old software—except the water & electrical grid, a few government services like our missile defense systems and a handful of electrified fences at the zoo (for the lions, tigers and cobras).
a few of the best companies I've backed came from founders I helped years earlier when there was nothing in it for me
it was number 1 for me most of the time. I thought I explained it in the meeting and everyone left with a different idea of what I wanted
One of my favorite Eisenhower quotes...
"Leadership is the art of getting someone else to do something you want done because he wants to do it."
There are only 4 reasons your team doesn't do what you ask:
1. You haven’t told them what you want
2. They didn’t understand it
3. They don't think it's a good idea
4. They don't see what's in it for them
Do all four and you won't have to ask twice.
I used to ask a designer for 2 options and wait most of a week so a dozen in a few minutes is a big change for a small team
