Saturday, July 09, 2022

8: Heat Wave, Ukraine

Venture capital’s reckoning Why there won’t be a rerun of the dotcom crash ........ Over $600bn of venture funds were invested worldwide last year, nearly ten times the level a decade ago. ........ Pension funds and endowments that committed large amounts of “dry powder” to private markets are trying to preserve cash by asking vcs to slow their pace of investing. ........ One concern is how interlinked tech firms might be. Some apparently profitable startups are earning money by providing services, from digital marketing to cloud computing, to other startups that are losing money and that in turn rely on endless blank cheques from their vc sponsors. ........ What emerges from the chaos will be a leaner and more efficient industry—and one that will remain a powerful force. .



How to win Ukraine’s long war After doing well early in the war, Ukraine is losing ground. What next? ........ Ukraine won the short war. Mobile and resourceful, its troops inflicted terrible losses and confounded Russian plans to take Kyiv. Now comes the long war. It will drain weapons, lives and money until one side loses the will to fight on. So far, this is a war that Russia is winning. ........... Ukrainian leaders say they are outgunned and lack ammunition. Their government reckons as many as 200 of its troops are dying each day. ........ Fortunately for Ukraine, that is not the end. The Russian advance is slow and costly. With nato-calibre weapons, fresh tactics and enough financial aid, Ukraine has every chance of forcing back Russia’s armies. Even if lost territory will be hard to retake, Ukraine can demonstrate the futility of Vladimir Putin’s campaign and emerge as a democratic, Westward-looking state. But to do so it needs enduring support. .......... The Russian economy is much larger than Ukraine’s and in far better shape. In pursuit of victory, Russia is willing to terrorise and demoralise the Ukrainians by committing war crimes, as it did by striking a shopping mall in Kremenchuk this week. If needs be, Mr Putin will impose grievous suffering on his own people. ........ In 2020, before sanctions, the economies of nato were more than ten times bigger than Russia’s. .......... Mr Putin’s generals will continue to have more weapons, but the sophisticated nato systems now arriving have longer range and greater accuracy. By adopting tactics devised in the cold war, when nato too was outnumbered by the Red Army, Ukraine should be able to destroy Russian command posts and supply depots. ........ Ukraine scored a success on June 30th, when it used nato weapons to drive Russian forces off Snake Island, a strategic prize in the Black Sea. It should aim to impose a “hurting stalemate”, in which it takes back similarly symbolically important territory, such as the city of Kherson, imposing a heavy price on Russia. ........... If Russia starts to lose ground on the battlefield, dissent and infighting may spread in the Kremlin. Western intelligence services believe that Mr Putin is being kept in the dark by his subordinates. ......... The West can raise the cost to Russia of a long war by continuing to press sanctions, which threaten lasting harm to Russia’s economy. It can split Russia’s elites from Mr Putin by welcoming dissenters from business and politics, and encouraging them to see that their country should not throw away its future on a pointless and costly campaign. ......... At a summit on June 23rd, the European Union awarded Ukraine candidate status, promising a deep level of engagement over the next decade. At another summit in Germany this week, the g7 affirmed and strengthened sanctions against Russia. And at a third in Madrid, nato acknowledged the Russian threat by substantially increasing its presence on the alliance’s eastern front. ........ the global costs of a long war will grow. Mr Putin has been blockading exports of grains and sunflower oil from Ukraine’s ports, which will cause unrest and starvation in poorer importing countries. He seems to be trying to create gas shortages in the eu this winter by preventing members from building stocks over the summer. If unity falls apart over energy, as eu states hoard gas, it will disintegrate over Ukraine, too. To complicate matters further, nato members worry that if Ukraine gains the upper hand, Mr Putin will escalate. That could draw them into a catastrophic war with Russia. ........... You can see where Mr Putin is heading. He will take as much of Ukraine as he can, declare victory and then call on Western nations to impose his terms on Ukraine. In exchange, he will spare the rest of the world from ruin, hunger, cold and the threat of nuclear Armageddon. ............ He will fight tomorrow with whatever weapons work for him today. That means resorting to war crimes and nuclear threats, starving the world and freezing Europe. .........

The best way to prevent the next war is to defeat him in this one.

......... To prevail means marshalling resources and shoring up Ukraine as a viable, sovereign, Western-leaning country—an outcome that its defiant people crave. Ukraine and its backers have the men, money and materiel to overcome Mr Putin. Do they all have the will? .





What to do when Slack cuts no slack Consider "vulnerable honesty" with chatty colleagues. For example, saying, "I love that you are including me, I am just not up to socializing."



On Leaving GitHub and Joining OpenSea I only vaguely remember the early days where we reviewed code on a projector and took notes on a notepad. Then came GitHub and I fell in love with a product for the first time in my life. ........ GitHub’s come a long way from the early days when I joined – figuring out the right solution for management structure and growing the team to almost 300. ......... OpenSea’s mission speaks to me, and the team is made up of some of the most genuine people you’ll meet. Their commitment to the cause is like no other. I’m excited by their work to build a creator-first marketplace where makers have unlimited freedom to bring their work to life how they see fit, and share it with people however they want. ........... They say

a bear market is for the builders

. It’s an opportunity to focus on what matters most – what’s critical for a successful community and is pushing the NFT ecosystem forward. ....... Let creativity reign and the best work rise unhindered by a system meant to extract all profits from builders and overcharge their communities.



When the iPhone was released, many people within BlackBerry rightly pointed out that we had a technical leg up on Apple in many areas important to business and enterprise users (not to mention the physical keyboard for quickly cranking out emails)… but how much did that advantage matter in the end? If there is serious market pull, the rest eventually gets figured out… a lesson I learned from my time at BlackBerry that I was lucky enough to be able to immediately apply when I joined Google to work on Android. .......... At BlackBerry, we would hear stories of

customers “accidentally” dropping their devices into the toilet

to force their IT team for an upgrade. It was hard to imagine in the mid-2000s that by the end of the decade carrying a BlackBerry would become “uncool.” ........... When BlackBerry tried to force fit the enterprise product for the consumer market with devices like the BlackBerry Curve, Storm, and Tour, and it didn’t work. .......... I had the opportunity to learn from our mistakes when I became one of the first Product Managers on the Android team. At Android, we were maniacally obsessed about the product experience, not the “Google experience.” .........
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Thursday, July 07, 2022

7: Afore Alpha



Afore Capital

Afore’s fresh $150 million fund includes a plan to standardize the pre-seed world And it’s ready to come after Y Combinator .......... Venture firm Afore Capital first splashed on the scene with the aim to institutionalize that angels, friends and family round. Now, after investing in over 80 companies over five years, the eight-person team has landed on a more specific way to do so: Offer a standard deal and raise what it claims is the largest dedicated pre-seed fund in the market. ......... Afore general partners Anamitra Banerji and Gaurav Jain tell TechCrunch that they has closed a $150 million fund fueled almost entirely, around 85% to be specific, by existing LPs. New investors account for the remainder of the capital, which brings Afore’s assets under management to $300 million. ......... Afore is launching Afore Alpha, what it’s calling a standard pre-seed deal that offers founders a $1 million lead investment via a $10 million post-money SAFE. The money, as well as resources and advice from Afore’s team, is offered in exchange for 10% ownership of a company. ......... The new standard terms will apply to any startup, regardless of geography, that gets accepted into Afore Alpha. .......... Venture firms have increasingly started launching their own in-house accelerators — take Sequoia and Andreessen Horowitz for example — but many are still investing on a deal by deal basis because of a focus on multistage, Jain thinks. ........ founders care more about investors who are focused on one stage ......... Most of Afore’s portfolio companies to date are first-time founders, a focus it plans to continue as assets under management scale. Of course, the company has experience cutting first checks, estimating that it has led more than 80% of the rounds where it has invested. Portfolio companies include BetterUp, Modern Health, Petal, Overtime, BenchSci and Neo Financial. ............... Startups in the pre-seed world don’t have revenue or hard metrics so it can be hard to value them beyond weighing supply and demand. Regardless, Afore thinks that the $2 million post-money valuation that traditional accelerators offer is just an “unfair lowball valuation in 2022.” .......... Afore Alpha puts the firm in direct competition with accelerators like Y Combinator and Techstars, or programs like A16z’s recently unveiled START. The co-founders noted that

their deal is five times more capital, and five times the valuation, compared to what other accelerators offer.

............. Afore gives the money upfront and doesn’t have any MFN clauses. ........ “We think it is very disruptive to founders. They should get a good amount of capital, and then go heads down and build the business.” ....... high valuations come with tough expectations — and startups could also buckle in trying to grow into their prescribed worth. ......... companies need $1 million to hit early milestones. ......... “In 2022, the venture community should be able to offer founders at the start of their journey a fair, transparent and meaningful deal.”



https://medium.com/afore

Afore is Tripling Down on Pre-Seed With a new $150 million Fund III in hand, we’re launching a superior way for founders to raise their first funding. ...... Afore was founded just over 5 years ago to build something missing in the VC landscape: a venture firm that won’t tell founders that it’s too early — or too risky– to invest. ........ We came to VC having served as early product leaders at Twitter and Google’s Android, giving us a unique understanding of how to shape a promising idea into a world-changing product. ........ As investors with strong product backgrounds, we made a conscious choice to focus on pre-seed. We’re passionate about supporting founders in

that formative “zero to one” phase when there’s little or no product, no traction, and no revenue. Pre-everything. Pre-obvious.

......... pre-seed, where the risk and rewards are greatest. ......... To many, pre-seed is a convenient way to get an early look at promising companies; it’s a means to an end. At Afore, it’s all we do. ......... We have built an enviable portfolio of more than 80 companies, with a collective market cap that already exceeds $11.5 billion. Afore is proud to have been first –and quite often the lead– investor in breakout companies like Modern Health, BetterUp, Petal, Overtime, BenchSci, Hightouch, Flatfile, Neo Financial and Retain, among others, and to have led more than 80% of the rounds where we’ve invested. ........... Nearly 85% of Afore’s portfolio companies have gone on to raise an institutional follow-on round; 64% of them have skipped straight to a Series A. ........ nearly one-quarter of the more than $1.18 *billion* that pre-seed firms have raised since 2016 has gone just to Afore. ........

Data shows more than 90% of today’s venture dollars flow to later-stage companies that have already reached product-market fit.

Accelerators and other early investors aren’t set up to provide dedicated help and are unwilling to commit meaningful money. So instead of getting the capital they need, founders are too often offered minuscule investments at comically low valuations. ......... The harsh reality is that in today’s market, and at today’s prices, accelerator-level capital barely covers the cost of getting started. With just a few months of runway, founders end up on an endless fundraising and demo-day treadmill, leaving little time to build a viable product — let alone bring it to market. The bottom line is that

you can’t fly a rocketship with a few gallons of gas; founders need fuel, not fumes

. ............ Afore Alpha, a new product that offers founders something better. It distills everything we’ve learned since 2016 into a single, standardized product designed to increase founders’ odds of success. ........... Afore Alpha sets a new standard for what a pre-seed deal should look like in 2022 — one that gives “pre-everything” founders the runway and personalized resources they need to reach traction and raise a substantial Series A .......... Afore Alpha is available to any founder worldwide. Entrepreneurs from Latin America, Africa, the Middle East, and elsewhere are increasingly seeking the same type –and same level– of resources available to their North American peers. And rightly so. With Afore Alpha, founders will get the same generous terms, whether they’re in Singapore, South Africa, Spain, or San Francisco. ........... With Afore Alpha, founders can now raise one meaningful upfront round and spend their next year actually bringing their products to market and actually reaching traction. It’s a winning formula that has worked time and time again for our portfolio companies. .



A Beginner’s Guide to Crypto: Getting Started with ETH the Ethereum network is presently one of the most engaging spaces to immerse yourself in. Most of the hype projects you see trending on Twitter are being built within the Ethereum ecosystem. ........ Bitcoin is currently *just* a currency whereas Ethereum is a system that includes its own currency, the ability to create applications using the system, and a vibrant developer ecosystem. ........ Borders are stupid! ........ Twitter, Discord, and Telegram seem to be the main social apps of choice for people involved.

เคœเคจ्เคฎเคธिเคฆ्เคงเค•ा เคธเคจ्เคคाเคจเคฒाเคˆ เคจाเค—เคฐिเค•เคคा เคฆिเคจे เคธเคนเคฎเคคि เคœुเคŸेเค•ो เค› : เคฎเคนเคคो

Introducing the 2022 State of Crypto Report towards a decentralized, community-owned-and-operated alternative to the centralized tech platforms of web2 ............ As legendary investor Benjamin Graham once allegorized: It’s best to pay no mind to “Mr. Market”, who frequently boomerangs from exuberance and euphoria to despair and depression. To Graham’s wisdom we add an addendum: Better to build. Consider that any prospective founders who swore off tech and the internet in the aftermath of the early-2000s dotcom crash missed the best opportunities of the decade: cloud computing, social networks, online video streaming, smartphones, etc. Now is the time to consider what the equivalent successes will be in web3. ............ Compare Meta’s nearly 100% take-rates across Facebook and Instagram to NFT marketplace OpenSea’s 2.5%. As U.S. Congressman Ritchie Torres noted in a recent op-ed, “You know something is profoundly wrong with our economy when Big Tech has a higher take rate than the mafia.” ............ web3 paid out $174,000 per creator, while Meta paid out $0.10 per user, Spotify paid out $636 per artist, and YouTube paid out $405 per channel. Web3 is tiny but mighty. ..........

More than 1.7 billion people don’t have bank accounts

........... underserved and unbanked populations – 1 billion of whom have mobile phones – crypto offers a shot at financial inclusion. ......... Helium, a grassroots wireless network, is posing the first legitimate, decentralized challenge to entrenched telecom giants. ........... Crypto is far more than just a financial innovation – it’s a social, cultural, and technological one. ......... We’ve barely just scratched the surface of what’s possible. ......... Ethereum dominates the web3 conversation, but there are plenty of other blockchains now too. Developers of blockchains like Solana, Polygon, BNB Chain, Avalanche, and Fantom are angling for similar success. ......... Ethereum’s overwhelming mindshare helps explain why its users have been willing to pay more than $15 million in fees per day on average just to use the blockchain ......... Blockchains are the hit product of a new computing wave, just as PCs and broadband were in the ‘90s and 2000s, and as mobile phones were in the last decade. .......... We estimate there are somewhere between seven million and 50 million active Ethereum users today, based on various on-chain metrics. (See slide 54.) Analogizing to the early commercial internet,

that puts us somewhere circa 1995 in terms of development

. The internet reached 1 billion users by 2005 – incidentally, right around the time web2 started taking shape amid the founding of future giants such as Facebook and YouTube.

Here's a look at who might replace Boris Johnson as UK Prime Minister On Tuesday, two high profile lawmakers expected to throw their hats into the ring -- Health Secretary Sajid Javid and Chancellor of the Exchequer Rishi Sunak -- resigned over the botched handling of the resignation of Johnson's former deputy chief whip in a sexual misconduct scandal. ............ Any candidates who run for the leadership will go through rounds of voting by Conservative lawmakers until only two remain -- at which point Conservative Party members nationwide will vote. The winner will be the new party leader -- and prime minister. ....... Sunak's stock sank earlier this year after revelations that his wife had non-domicile tax status in the UK and that he held a US green card while a minister. His popularity has also taken a beating in recent weeks as Britain has suffered a cost-of-living crisis. Sunak has struggled to keep down spiraling inflation and has been criticized by opposition parties for what they call a slow and inadequate series of financial measures. But he is still among the bookmakers' odds-on favorites to take Johnson's job. ........ The MP has twice run for party leadership in the past -- in 2016, after the Brexit referendum, and in 2019, when Johnson was ultimately elected. ...... She has a formidable and dedicated team around her -- some of whom previously worked in Number 10 -- which has been producing slick videos and photos of her looking thoroughly statesmanlike. ......... Less than two days after he was appointed to chancellor, replacing Sunak, Nadhim Zahawi publicly called on Johnson to resign. "Do the right thing and go now," he said in a statement on Twitter accompanying a letter to the Prime Minister. ....... Zahawi was born in Iraq to Kurdish parents and came to the UK at 9 years old, when his family fled Saddam Hussein's regime. He is believed to be one of the richest politicians in the House of Commons, and helped found the polling company YouGov.



The Maldives is building the world’s first floating city . The first homes are slated to open to public viewing in August ......... .



Kidults' drive a bump in toy sales Child's play is big business, but not entirely because of kids. Adults buying for themselves are helping drive toy sales, which jumped 37% to $28.6 billion in 2021 ...... So-called "kidults" are snapping up building sets, games and more, a trend that gained steam during the pandemic as all ages sought a little escapism. Companies including Lego and Razor are leaning in with increasingly adult-friendly products, which seems like a no-brainer: An industry survey from 2021 found that 58% of grown-ups are buying for themselves. .

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