Life As a FA

Love Hearing Some Aspirations (Notes from Oct 14 – Oct 20, 2019) December 19, 2019

Happy holidays, everyone! Hopefully you’re staying warm/dry – whether that’s inside or just generally in a better location. I’ll say I already wish that I purchased into that ski cabin for the holiday since we’ve had a bunch of rain over the last few weeks in the bay area and now fresh powder in the Sierras. But alas, I did not. Next time, next time.

I’m going to keep this brief, but primarily because I have fallen behind in writing and it pains me weekly. Habits break and that may need to be bumped up in the new year – try out substack or something similar. But, I think I’m finally going to launch something that I’ve been meaning to build. CV / Image recognition sourcing into a database to keep track of something that plays a prominent role for many. We’ll see if I can get the prototype usable and I’ll update here.

Aspirations – I love talking and listening to people who have big dreams. I think there are many who hold themselves back for all kinds of reasons. If I catch wind or hear it, I will push you to start – something, anything – for your sake. It’s rewarding to have to dive in and try it out. Maybe it falls off after 6 months. Maybe you run out of money that you allotted to the side. Maybe, you succeed. Or learn  enough to accidentally fail upwards into a better / concrete idea. I hope for it all when people have these ideas. It’s inspiring – helps me go through my own models for how I interpret my world if I have to wrap my head around how friends/colleagues/Tweeps view their own. And how things can become better. Ultimately, that’s what we’re trying to do with many ideas. Is it a cool new thing? Is it something you wish you had? Is it an observation that you want to test? Build. You won’t regret it if you don’t in the grand scheme, but if it’s a big enough itch, it’s worth the learning experience in a world where not enough of us do (but it’s not for a lack of time).

Hope you enjoy the notes.

• Patrick / Raamayan, Cofounder of Unify (Wharton XM)
  
  • Global meditation, achieving state of flow
    • Could be gym, yoga, prayer, running
  • If you have an hour, you have 15 minutes
• Brianne Kimmel (@briannekimmel), Worklife Ventures (20min VC 10/14/19)
  
  
  • Backed by Andreesen, Chris Dixon, Zoom’s Eric Yuan, and friends Alexis Ohanian, Garry Tan, Matt Mazzeo
  • Teaching General Assembly while operating in performance/growth marketing role at Expedia before Head of Social Media
    • Go-to marketing bootcamp (SaaS school now)
    • SaaS school taught my brand name heads at SaaS top places
  • Started with $25-50k angel checks in Webflow, Voiceflow, Airgarage and built a track record
    • Wanted to build a SaaS-fund to focus on go-to-market from bottoms-up
    • Enjoys building and structuring companies to get into the Venture-sized outcomes
    • Having a fund that’s open enough to maybe do private equity after stuck between $3-5mn ARR
  • Optionality for early stage, inflection points, maybe getting growth PM to scale into CEO
    • $150k checks incrementally grown from $25k
  • Proliferation of funds and capital – investing from own, micro-VC and angels platforms
    • Scouting for VC fund – operators at hot tech company
    • AngelList and Carta as platforms for own angel funds or boutique arrangements (flexibility with checks, numbers, still operate)
  • Celebrities/athletes using investments in startups to match their brand or expand it
    • Intersection of work and life – seeing Faire and Shopify give access to a huge new audience
  • Angels with leverage in cap table – “perfect one” and she grooms founders for this
  • Worklife – services and programs to unlock human potential at scale
    • Hypevsaas – traditional language for b2b is dead, according to her
    • Great saas being built by operators spinning out of consumer tech (Airbnb, Coinbase, Uber)
      • Scaling too quickly where they end up building their own tools before open sourcing or monetizing
    • With self-serve SaaS companies, many APIs and workflow tools, are easy to build – what’s the competitive advantage
      • Your access to tech, building closed products (specific users in line with product vision)
    • Opposite of Hypevsaas as “Scrappy SaaS” – going away slowly, race similar to consumer product for paid marketing
      • Freemium to quickly launch/build but products too easy – race for free users and attempt to monetize later
      • Mirrors side hustle or application as experiment with a possible traction
  • Consumer-grade experiments where users pay from day one – mentioned Superhuman and Rahul’s talk
    • SaaS school discussion about video game design and hook
  • Pace as most recent investment – accessing software with lower monthly rate because they access the contracts
• Justin Kan (@justinkan), Founder / CEO of Atrium (20min VC 6/21/19)
  
  • Full-service corporate law firm for startups
  • Started in 2004 with online calendar a la Gcalendar called Keeko, got into YC
    • Failed and sold it on ebay eventually
  • Then started Justin.tv – terrible idea that mostly failed and eventually made it into a streaming site to do Twitch
    • Sold in 2014 to Amazon, started another company called Exec in 2015 – errand service
    • Became a partner at YC but realized after a few years that an investor full-time wasn’t for him
    • Forced, as a startup founder, to learn things (hadn’t been learning as an investor)
  • 2017 – remembered how painful it was learning things – thinking of ideas
    • Conversation with a partner at a law firm in the city – asked her why they didn’t use any tech themselves
    • Full-stack corporate law firm in US – high growth companies that they’re building for last 2 years
  • Had used legal services no matter what they had – big transactions pay attorneys regardless, stable market
    • Will exist in a downturn because things don’t just stop
  • Remembered that every summer at the start of his startups, he would want to quit – think of new ideas or new things
    • Once out, he’d think he didn’t want to do it again, until it brought him back
    • First 3 months – thought he was great, figured it out due to 10 years’ experience, until stress came back
      • 6 months of stressful period – figured it out that he was still fine, reputation/old job
      • Self-improvement and growth had to come from culture
  • Hard to detach yourself from company as entrepreneur
    • Has attachments and notifications to make sure that he’s being present
    • Having goals in life, company, entrepreneur – board game metaphor – friends play and being engaged
    • Put away a game – do you remember or care what happened?
  • Started seeing a therapist 7 years prior – coach for dealing and discovering about what you’re going through
    • Cathartic, in his opinion – not alone and can talk to people
    • 15 Commitments of Conscious Leadership, Steve from Reddit
      • Radical responsibility – nobody else will come to save you, nobody to blame
      • Radical curiosity – whenever a new situation comes up, you approach it with what you’re supposed to learn
  • Don’t have to suffer for doing a start-up – not saying “Don’t work hard”
    • Building up skills, expectation for suffering isn’t the case
    • Atomic Habits by James Clear for him following working out each day
  • Zone of Genius – cares and loves to focus on, delegate rest
    • At Atrium, focus on business strategy, selling, culture
    • Build the team for the rest of it
  • Much better at recognizing patterns after investing 100 companies
    • Implementing in company, business models and market dynamics
    • Bad – investor attitude (approached Atrium like this)
  • Atrium – up to 150 employees in SF now – happy and proud for the culture and growth
• Eric Kinariwala (@ekinariwala), founder / CEO at Capsule (DealMakers 10/15/19)
  
  • Rebuilding pharmacy from inside out – raised $270mn from TCV, Thrive Capital, Sound Ventures, Virgin Group, M13
  • Wharton undergrad, network from there as financial services, banking and decided to go to west coast – Stanford
    • Started at Bain Capital in Boston after graduating – worked in a hedge fund group investing
      • Retail, healthcare, tech – blending framework around business strategy, what makes it a good business
      • Judging management and the synergies – learning how to invest, as well
    • Making right judgment calls – tight feedback loops
  • For Capsule, had moved back to NY, got a headache – called doctor and had a prescription ordered
    • Pharmacy is $350bn – most frequent interaction in healthcare
    • 2nd largest category of retail – 70k stores
    • Got headache and went to go pick up his meds but couldn’t find it, then they were out of stock and it was awful
  • Hard to get advice from the pharmacy, don’t know the price until they go to pay
  • Everybody touching the pharmacy has a headache, typically
  • 3 pillars of Capsule: modern technology platform, emotionally resonant brand, pharmacy how your mom would treat you
    • Prototypical pharmacist as founder, 2nd was highly experienced technologist, 3rd woman that spent building consumer brands
  • Business model – “10x better” than current existing – technologically enabled pharmacy – app with 5 pieces of information
    • 2 hour delivery windows, know price of medication, doctors know what you’re doing
    • Why are there so many pharmacies? Put money spent on rent back into beautiful design and technology to be seamless
  • Launched in 2016, first customer in May – first challenges in early days
    • Strong word-of-mouth from friends, doctors who had learned about Capsule – telling patients and vice versa
    • Early pharmacist was well-versed in regulatory environment for anything that could’ve been broken
  • He had raised in May ’15 to get started – raised $70 million to start
    • Ideal profile / entire business model needs to be aligned with values: objectives, values, strategy and metric
    • Asking to join and leaders need to have alignment in the same way – even the board – share vision and how / why you operate
  • Team is bigger than 250 full-time, all in NYC now – encouraging people to read ahead of joining, also
    • Checklist Manifesto, On Wings of Eagles, Danny Meyer’s Setting the Table, and Who by Dan [Geoff?] Smartt
  • For the future of Capsule – most important thing in your family’s life as healthcare (although I’d argue bank or something)
    • 5x more pharmacy visits than doctor (sheesh) – wants to make it mobile-first and on the home page of phone
  • Piece of advice for his first day: be more confident earlier
• Gimlet 1: How to Not Pitch a Billionaire (Startup Podcast 4/5/14)
  
  • Pitching Chris Sacca – meeting at a hole-in-the-wall sushi place for lunch in LA
    • Deck as a crutch and did it outside the lunch – no slides
    • Most people consume audio in radio and are leaving to digital – audio dashboard, podcasts music all there
    • Wants to start company for the content for moving into the digital future
    • One question he asked: what’s the unfair advantage? Explained how to make money (ads, listeners)
      • Freemium – offer an extra for the listeners who want to pay.
      • He answered: making freemium model work – had to tighten it up
    • Chris Sacca – took 2 minutes and did the pitch
      • People willing to pay for this stuff – Planet Money where they gave $600k to buy tshirt with our logo
        • Integrated directly that we can replicate
      • $1.5mn to buy 3-4 guys for podcasts in next 12 months, can get to 300-400k net subscribers
        • Can get to breakeven on ads alone, CPMs where they are – more integration and episodes will be ultimately scale
        • 12-15 podcasts and we can do it
    • Then countered with the audio is a niche market – nonprofit and audio moving toward shorter content
  • Met him on a Planet Money story when he was going over patent system and how it was slowing innovation
  • Strategy/ideas at Google, writing seed investment check in PhotoBucket – didn’t have it, though
    • Just $50k and wrote 2 credit card checks – enjoyed the feeling so much he left Google
    • First investment was in a colleague, Evan Williams, for Twitter as a full-time angel
      • Wrote the check for $25k – was a lot of cash to him, needed it to work – wanted to help out, evangelist
      • Started buying more shares and doubling – believed in the company
  • Kickstarter, Uber, Instagram, etc… looks hard at the conviction of the success
    • Missed on DropBox (Gdrive was going to crush them), Airbnb (someone will get raped or murdered, can’t work)
  • Told him to come back, tighten the pitch and then do it for Chris’ partner Matt who was from the media world
• Pankaj Risbood (@risbood), founder at Zendrive
  
  • Discussing leveraging data and making it a platform instead of an app
    • Dealing with partners to ensure they can improve value
  • Mission Street project – 6 months driver flow before and then after shutting down
    • Reducing poor driving / improve driver safety and it was fairly obvious
  • Can deploy this in the form for insurances, as well
    
• Jacqueline Courtney (@jac_courtney), Founder of Nearly Newlywed (Wharton XM)
  
  • Pitching on Shark Tank to grab attention
  • Starting as seeing option in fashion tech for underserved market
  • Tough for Amazon to compete because of the marketplace factor and users are only in for 1 sale, 1 wedding
    • Taking 40% of the sale but trying to maximize the amount of cost for many
    • Realized photos that were posed / models with dresses didn’t sell as well as real wedding photos
      • Started asking customers for them this way
• Noah Auerbahn (@noahauerbahn), co-founder and CEO of Robin Healthcare (Lindzanity 10/2/19)
  
  • Robin as virtual scribe that sits on doctors desks and records video/audio from room – sits in exam room
    • Started with orthopedic physicians – 6 sub-specialties and they cover all of them so far
  • Met Gary, Howard’s partner, when Noah was 21 and starting first company – ExtraBucks (cash back coupons)
    • Came up with at dorms in USC, raised enough money to move to SD with his cofounders
    • Were cash flow positive and had Gary and Alex as advisors – realized he didn’t want to be in ecommerce forever
      • Decided to sell and exit once they questioned it – had raised around $1million, no venture
  • Believed college as what you make of it – did entrepreneurship / business in undergrad but taking it and questioning how to apply it
  • Education, energy, and health were the lists of what he thought may have the most impact – health was the biggest for him
    • He would hire MIT PhD and UCLA MD to come to his office and tutor him – “pretty affordable, like $70/hr” to teach at pace you want
    • He wanted massive optionality within healthcare – not just ecommerce, if he wanted to do pharma, biotech, find the right entry point
    • 100s of research posts, 100s of conversations, started going to conferences (where he met his cofounder)
  • Entire system – center of the system is the exam room – decisions get made there, so he wanted to build something interesting inside of that room
    • Patient, doctor, and EMR (not interested in sharing data)
      • Found out that there was a scribe in 5% of rooms and he asked why they aren’t remote or something
      • Lower burnout rates, better throughput and service, notes/quality control could have issues
      • Decided to tool in a good UX, ML additionally
  • Wanted to do something big, had to raise money eventually but “How many assumptions could he kill or the idea before saving time?”
    • First paying customer, had $40k, webcams, notes (his cofounder doing them), device streaming and did it at his mom’s vet clinic (non-HIPAA)
      • Built own tech, had some handful of paying customers – had taken some friends/family $ that missed on his first company and then real
    • Didn’t anticipate hardware but couldn’t find something that could be used for solving this
      • Security cams aren’t great because of acoustic but could stream all the time
      • Conference ones which aren’t designed to run all the time – ran own software on it, but lot of work to keep it working all the time
      • Sonos speaker guys were helpful in producing what they ended up building (optional video)
  • Device has about 2% of people where they don’t consent – video/audio and can be more in tune with the patient
  • Having offices in SD, Berkeley (his reverse commute from SF) and Austin – where most pre-med scribes are for them
    • Mentioned 30% Stanford Med graduates don’t end up as doctors – go into tech
• Morgan Housel, co-founder of Collaborative Fund (Lindzanity, 10/9/19)
  
  • Howard’s favorite thinker/writer/storyteller and his interesting career arch – key to writing is writing
  • Effective long-form is rough but when it’s good, it’s bar-belled (10 seconds is better than longer reading)
    • Only books he got through were Shoe Dogs and Agassi’s book – Munger’s “Don’t be burdened by bad books”
  • Cramer’s “Confessions of a Street Addict” as good, as well
    • Coming from nowhere, knew how to write briefly, Howard as superfan – first modern financial professional that had personality
    • Howard feels like it’s an underachievement – Morgan said he’s not a great investor – so much trust built up that he should be running a massive firm
    • Access to people, financial celebrity
  • Fascinated by Motley Fool – when Morgan had hedge fund, had CNBC but Dave and Tom Gardner – hats on, promotional and StockTwit before
    • Went for mom and pops – tremendous marketers, but made mistakes
  • 2007 – dawn of financial disaster, studying econ at USC (his plan was p/e and ib) but finance was terrible
    • Didn’t think highly of Motley Fool – had gone through Yahoo finance boards and saw his friend, Sham Gad, at USC was writing for them
    • Thought he’d do Motley Fool shortly as contract, couple months, and was writing an article a day – (plan was initially p/e but they couldn’t bring him on)
    • For him, he was supposed to be banking industry, and writing other stuff as well – economy and macro issues (unemployment, fed reserve, budgets)
    • No explanation for decisions being rational – before, during, after no good explanations – psychology of investing
  • Psychology of investing will always be there – different layers of edge and vs technical side – can be base of pyramid
    • Smartest analyst or data miner but without greed/fear, nothing would matter (Howard moving to angel – forced to go with it, prices were his weakness)
  • Time split for Howard – 50/50 between public/priv (prices keep him up to date on news)
    • Selling at Uber at $10bn because he wasn’t allowed to sell at $1bn – he was in with David Cohen’s $4mn fund, $50k at $4mn valuation, so he had $2k
    • Sold a lot early and then sold at $40bn and that’s where it is now – public would’ve been very different
  • New banks may be what Andreesen is doing – start as VC & get larger, for next 20 years
    • Citadel starting as hedge fund from dorm and now top-tier investment bank, doing everything – exchange, conglomerate
    • Partnership that can have trading stocks, wealth management, lean beast with trust/access – 2.5% fund without GS
    • Private becoming so large because of the liquidity area there
  • Josh as being equally funny and smart, not caring about markets – gave a sponsor to Morgan and Jesse Livermore (pseudo) and Twitter explodes
    • Motley Fool for 10 years, contractor for 7 years – LA first and then Seattle, then Alexandria for 3 years – only time he’s had a desk and office
    • Wife went to grad school in Baltimore to move them out that way
    • Motley Fool as bigger than you think – P/E mistake, big tool and screwups to learn a lot about mistakes
      • Joining Collaborative Funds (Craig Shapiro splitting time between NYC and SF) was easiest decision, but leaving MF was hardest of his life
  • What really can set you apart is not writing a check anymore – everyone has a checkbook
    • What do people know about you? What do you stand for? What is your vision?
    • If he could write what they wanted to read, it would draw back some attention to what they’re doing and standing behind.
  • Went to plenty of conferences, 4-5 a year and learned to speak – had a CFA Institute where he was the interviewer
    • Did keynotes for Motley Fool, video made it to Washington Speakers Bureau and started to do that
    • Several dozen talks a year now – wasn’t the plan original (2016 as first year)
      • Doesn’t sketch out an idea, write out an outline – just knows that he enjoys some part and how to contextualize it
  • Spends majority of his time going on walks to “write” – tough for him to grind the gears
    • 95% of his investing is house, checking acct and 3 Vanguards funds – saving dollar-cost-averaging there, since he isn’t really writing checks
    • Thinking about “enough” – 8% is fine, 10% would be nice but not worth stressing (says opposite of type A)
      • Odds are low to beat market, same with running – 3 miles is enough for him, doesn’t need to do half marathon
      • Biking for 1 – 2 hours, knows the burn, won’t need to do more
    • Why Howard says Andreesen’s model likely to make a difference
      • For Howard – indexing, 90% there and 10% to try to beat
    • If it bothers you, why are you torturing yourself? If you need to scratch the itch, take a small enough.
    • Hates idea that Vanguard gets to pick the 500 companies for him, not a fan of $5mln raise if you can do on $1mln
      • Similar to Risk gm – don’t start Europe, east Aus is better
  • Indexing as Robinhood vs Vanguard – somewhere in between (not robo), but just de-selecting the companies you may not want to invest in
    • Feel better, maybe hold on more during drawdowns – incentivize riding the wave
    • Example from Morgan about mom hating Monsanto (then he pointed out she owned some – she wanted to sell)