Tech Market Analysis


 

Obsession. The drive to succeed at all costs. When second place isn’t good enough because we live in winner-take-most markets. The desire to be better than anybody else in one’s field.

This blog started from a series of conversations I found myself having over and over again with founders and eventually decided I should just start writing them.It would often make my colleagues laugh because they’d hear me like a broken record and then the next week read my ramblings in a post.

Last week’s obsession was about obsession itself.

10 days ago I saw the film, Whiplash, which is one of my favorite films of the year. I would be shocked if it doesn’t win at least one Oscar. I won’t have any spoiler alerts here, don’t worry.

The protagonist in the film, Andrew, is a drummer and the story is his experiences in his freshman year of one of the most elite music conservatories in the country. He wants to compete to be the lead drummer in the competitive ensemble and study under Terence, an obsessive instructor who is hell bent on winning competitions for the school.

I absolutely loved the film. I loved the music. I loved the intensity. I loved the drive to succeed, to compete and to be one’s best. As you can imagine – all great films have conflict and the tension is this – what is an acceptable level of obsession to put into success, whether instructor or student?

The rest you should see for yourself.

But the film has my brain buzzing all week about obsessive and competitive people. Think about Kobe Bryant. Kobe is famous for waking up crazy early every morning and practicing for longer and harder than nearly anybody else in the NBA. Kobe isn’t Kobe just because he was born naturally tall and athletic – although that is a

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The story on Uber has been written about ad nauseam, which is why I’ve been reluctant to weigh in. But enough people have asked my perspective so I decided to weigh in with my non-conformist view. I love Uber and I don’t believe there has yet been a real scandal. Grievances – yes. But scandal? I’m not so sure.

For starters – I’m not an investor in Uber. I wish I were. I had a chance to be in the seed round and unfortunately didn’t do so. I didn’t invest in any of their fine competitors either like Lyft, Sidecar, Hailo, etc. I have no overt biases (we all have subconscious ones). I’m not friends with Emil Michael – I’ve never met him.

This post is nothing than a bystanders attempt to put this situation in perspective.

1. Is Uber evil?
No. That’s silly. It’s a fantastic startup that has had a amazing impact on society. It’s not just about people like me who can (and do) turn up in nearly any city in the US and immediately book a ride. On that front it has revolutionized my life. No more 45-minute queues at airports, no more stuck in the rain with no ride.

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I’m pretty on record as saying I don’t think many private-to-private tech mergers make sense. They are often done from a position of weakness. Something in both companies isn’t working, which is why they come together.

I often don’t believe in the therm M&A because in my experience mostly A works.

But of course there are always exceptions. And even when I remain skeptical sometimes opportunities present themselves that prove one should never be absolutist.

As many people know I funded a company called Moonfrye almost 2 years ago led by two amazing women – Kara Nortman & Soleil Moon Frye. Our goal from the outset was to build a great eCommerce experience that could compete with Michels on one side (for DIY / crafting) and Party City on the other (throwing events / parties / celebrations).

The thesis was simple. Mom’s struggle to plan events and activities for their kids. Most products out there suck so mom gets stuck with angst of wanting to have decorations, activities and chatzkies for other kids to take home. What should be an enjoyable experience turns into a time-suck obligation and angst-ridden day of self questioning.

Our product name is P.S.

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We are often asked how companies get funded, why VCs make the decisions we make and what we’re looking for in entrepreneurs. I think this is a Seriously great example of how this process works for at least one VC – Upfront Ventures. But I’m guessing the narrative is similar elsewhere.

I first met Andrew Stalbow, the founder & CEO of Seriously in August of 2013. He hit me from two very trusted sources. On August 23rd, 2013 I had an email intro from my good friend and trusted source Jeff Berman who only sends me stuff when it is somebody he respects (ie a strong filter vs. those who send casual intros). On August 26th I had an equally effusive intro from Ynon Kreiz, also a friend, trusted source and also the CEO of portfolio company Maker Studios. So this was definitely an introduction I was going to take.

We met on August 28th, 2013 and I know this because literally the next day

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An abbreviated version of this post appeared yesterday on TechCrunch.

If you want the full SlideShare deck with many slides not in either post it’s in this link –> The LA Tech Market

“There’s something going on in LA.”

It’s the most common refrain I hear from investors and even entrepreneurs these days. I hear it right after people have decided to come by for a few days to “check out what all the fuss is about.” I hear it when I visit LPs (the people who invest in VCs) all across the country, “Yeah, I haven’t been out there for a few years but I keep hearing that something is going on there.”

Or if you ask the venerable Greg Bettinelli, he’s

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Amazon. It’s the company that evokes fear into more startups and venture capitalists looking to fund eCommerce businesses than any other potential competitor. Every pitch I’ve ever seen has led to the, “Would Amazon eventually do this? And could we then compete?” type questions.

But what if you could do the reverse of Amazon?

Amazon was early in spotting a macro trend – that physical, local retail had a few key disadvantages. The first is that it could carry limited inventory in stock because it had limited physical shelf space. The second is that the retailers were constrained by their high costs of local real estate and service staff relative to the costs of centralized warehouses where goods could be stacked high, sorted by robots, managed by RFIDs and then shipped via overnight to eager, cost-conscious customers across the US.

Today’s $24 billion storage market in the US has these same key disadvantages and that was the genesis of Sam Rosen’s initial idea for MakeSpace, which I initially funded 15 months ago.

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