Thoughts on investing

  • Landscape

    • Most value is going to be captured by technology for the next wave of my working life. Product, market, team.

    • The current venture capital market influences behavior in a way that compromises genuine innovation.

    • Prerequisite for coders, operators, and investors to deeply consider the consequences of a product on society – and defend it.

    • Growth-stage investing is bordering on insanity. Billions of dollars is invested into companies that don’t have the capacity, infrastructure, or founder/CEO leadership to use that kind of capital responsibly.

      • Baton is being passed from VCs to public shareholders to subsidize below-market urban services like transport (Uber), office space (WeWork), and food delivery (UberEats, Postmates, eventually Instacart) that, in aggregate, represent multi-billion dollar annual losses. What stage of capitalism is this? How much patience do private markets have for it?

    • Corporate giants are susceptible to a cycle of rise/fall. The erosion of trust in down cycles creates opportunities for private companies due to new regulation (legislation) or accelerated innovation (competition).

    • If they have to tell you they’re “founder friendly,” they’re probably not. Notable exceptions: Felicis Ventures, Founders Fund.

    • Assume Board of Directors are failing in corporate governance. A failure like Theranos could absolutely happen again.

    • Antitrust regulation: Don’t dismiss it. A new framework will emerge and directionally change the tech landscape as we know it.

    • Privacy: How a company thinks about privacy is best measured by its default setting.

    • Hidden gems I love to talk about: DuckDuckGo and Kylie Cosmetics. The stories and metrics of these companies are incredible.

  • Categories

    • Hardware: Progress in tech and science have hardware dependencies. Watching: Cray (public). In robotics/AI: Vicarious, FarmWise. Tell me about other companies working on these problems.

    • Software: Always impressed with companies who build self-serve, pay-go models first.

    • Frontier areas: Brain-computer interfaces, space exploration, seasteading. Ideas I can’t imagine from others who have the dream to build it. Following Pioneer & Thiel Fellows here.

    • Education: Desperately needed. Alternative models like Lambda. Watching Guild Education because the model could be applied to non-traditional education.

    • Maker economy: Platforms enabling makers, artisans, and small business owners to improve logistics and economies of scale – and monetize their offerings – will thrive. There is a longtail here that Amazon will never capture.

      • Watching: Shopify (public), Faire, Neighborhood Goods, Patreon, Daisie, and the arteries and veins fueling those companies like Anvyl, Bookmarks, Tundra, Lumi, and Packlane.

      • Still skeptical of the amount of outside capital needed to launch successful D2C brands. I have mixed feelings about Red Antler’s branding-for-equity model.

      • Tools for makers: Still fascinated by companies like Canva, VSCO, Unsplash, Issuu, Jumprope. AR/VR: Unity, svrf.

    • Health & Life Sciences

      • Genomic sequencing: We are still in the early days of what’s possible. The $100 genome is ahead. Watching: Karius and Clear Labs.

      • CRISPR: Early. Watching: Mammoth Biosciences.

      • Health: So much to love here. Excited to see the gut-brain connection surfacing. Watching: Whole Biome, Truepill, Alto Pharmacy, TrialSpark, Suki, Hexagon Bio, Komodo Health, & Trusted Health. D2C: Ritual Vitamins, Curology. Side note: Obsessed with the Google Brain team’s research, specifically the latest r/t diabetic retinopathy.

      • Alzheimers: Who is working on the plaque approach with imaging?

      • Mental Health: Sage Therapeutics is the only company (public) giving me hope re: therapeutics for depression. Mindstrong (private) is promising in other contexts. Watch: Companies working on problems related to the opioid crisis like Groups and Eleanor Health. Tell me what gives you hope in this space.

      • Sleep: On the fence about the market here (is this a luxury category?) but companies like Eight and Oura intrigue me.

      • Senior care: We need a better way. Watching Honor, Billy.

      • Loneliness: Mon Ami, RentAFriend.

      • Maternal care: Huge opportunity to support new moms and parents. Watching: Mahmee, Cleo.

      • Maternal mortality: It’s gut-wrenching where the U.S. falls and fails mothers here. Watching: Alydia Health.

      • Taboos

        • Sexuality: Taboo still exists. This summary of Dipsea by Bedrock Capital is a must-read.

        • Menstruation: Taboo again. Thinx and Flex are great examples of early leaders. Tremendous room still exists in this space.

        • Longevity: Taboo but it’s here. BioAge, Age 1 accelerator.

        • Death: Taboo x10. Who’s innovating at scale here? Love what Tulip Cremation is offering.

    • Defense: At its best, tech can make conflict rarer and less destructive. It’s a principled decision not to withhold technology from institutions of sovereign governments to protect the freedoms that we appreciate. Watching: Anduril.

    • First responder tech: goTenna, C-THRU, Perimeter.

    • Sustainability: Fashion rental (Rent The Runway, Le Tote, Armoire, Switch), furniture rental (Oliver Space), furniture consignment at scale (Kaiyo), lab-grown diamonds D2C (Couple), material innovation (Bolt Threads).

    • Insurance: Always. Ethos, Abe.

    • FinTech: Checking account is still the hub (Plaid). Huge opportunity with the financially underserved (Petal, EarnUp, Even). Payments is still highly fragmented. Love seeing Stripe integrating new solutions small businesses. Closely following Affirm vs legacy players (+other competitors) in the payment plans space.

    • Employee benefits: 401ks (Guideline), childcare (Kinside), dental (Level), mental health (current models I’ve seen are very lacking, fertility.

    • Location: SafeGraph, Niantic (yes). Logistics: Any companies optimizing last-mile?

    • Comms: Not convinced email or Slack is how we’ll communicate in future generations. But, still watching: Threads, Mailchimp, Revue.

    • Real estate: Concepts like Divvy, Bungalow, Modus.

    • Travel: So much can happen here but haven’t been wildly excited about anything. Watching: Sonder, Hipcamp, Thatch.

    • Media: How will we consume news and other media in the future? How will we pay for it? It will look different. Watching: Holloway Guides, The Players Tribune.

      • Will we ever be able to easily highlight, annotate, and save the web – and collaborate with others on it? Genius lost here.

      • Micro-focus models: Trapital blows by mind. Also, SupChina.

      • Interesting case studies: Brit & Co

    • Social: Not dead. Likely won’t be a runaway hit like TikTok but something that starts micro. Watching: Alma Campus, Panda (app) and its founder. I will never invest in anonyous social media.

    • Dating: Match Group owns everything except Bumble. No strong differentiation among apps. Huge opportunity to innovate, especially as new generations date and new cultural norms appear.

  • Bubbles

    • Scooters

      • Longer battery life could make unit economics viable

      • Opportunities in specific markets (e.g. Israel, similar to Waze) that – if applied to other markets – could make it work

    • Crypto (does not include Bitcoin)

    • Not-tech masquerading as tech co

      • WeWork: Predict this will be the biggest financial catastrophe of my lifetime.

      • Peloton: Evolving thoughts here.

      • Theranos: In retrospect, a bubble was created through a cascade of false signaling. No traditional biotech investors on the cap table.

  • Skeptical of…

    • Macro-level: Level 5 AV in my lifetime

    • Trends: Most D2C categories with small or premium audience segments will be overly immune to market changes

      • Premium: Shoes, clothing, accessories, luggage, concierge services including medical (Forward, Parsley Health)

      • Regulation: Hims/Hers and similar

      • Competition post-patent: Teeth straightening

      • Collab tools: Notion

      • Employee perf management, “engagement,” and coaching: Culture Amp, Humu, Lattice, Betterup, Goalspring, Sounding Board

Thoughts on public markets

  • Corporate buybacks leveraging >$5T in debt will be a significant factor in the next economic downturn.

  • Fave public companies to buy in a down market: Shopify, Adyen, Illumina, Sage Therapeutics, Mastercard, and Intel. My soft spots in tech make me follow Pinterest, Spotify, Square, and Twitter.

  • Still in the early days of Spotify. Their moves in podcasting including the Gimlet Media and Anchor acquisitions will help them dominate the number of hours people spend with the app for years to come.

  • Looking ahead: Will Aramco list? On which exchange? Whoa.

General outlook

  • Whenever possible, I default to being an enthusiast. It's easy to be cynical and important to have criticality, but we have many difficult problems to solve and it requires resolve every day to wake up with excitement, to leverage the gifts we each have, and to move forward together.

  • People overestimate what can be accomplished in a year and underestimate what can be achieved in a decade, and that's where I find the biggest opportunities. What will be true in ten years? Status lags by a generation. My parents didn't understand my obsession with tech and the internet but that's where I invested my time and found the biggest return on it. The biggest investment opportunities will often be the narrative violations I find hard to believe now.

Hard times create strong men.

Strong men create good times. 

Good times create weak men. 

And, weak men create hard times