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Year: 2017

SiliCon Men

SiliCon Men

Now, that’s a book we’d like to see written and we do want credit for the title.

Dan Lyons put Silicon Valley’s bro culture back on the radar, and speaking of bro culture, Alicia Syrett (Pantegrion Capital) once referenced an article where two identical resumes were submitted to a hiring manager, one under a male name, the other under a female name. The hiring manager opted to meet with the male. Reason: he had stronger, more relevant experience.

What to speak of the fact that Men With 2 Years of Work Experience Earn More Than Women With 6. Read More...

The Rise and Demise of the On Demand Economy

The Rise and Demise of the On Demand Economy

Call it the Sharing Economy, the On Demand Economy, the 1099 Economy, the Gig Economy, or maybe most accurately, the Piecemeal Economy (since the work isn’t necessarily always there) or the Participation Economy (since it seems that anyone can share almost anything these days, including your home, your car, your time, even your Significant Other). But take note: according to Fast Company, The Gig Economy Won’t Last Because It’s Being Sued To Death. Worse, where’s the sharing when The Gig Economy Celebrates Working Yourself to Death.

There was a time – and we’re sure that it’s still going on – when startups would present themselves to investors as being the Uber of Whatever, since Uber, an early entrant into this vertical, has long been perceived and touted in the press as the jewel in the crown of the Sharing/On Demand economy. In fact, Handy has been referred to, ad nauseam, as the Uber for Home Cleaning, although, workers pay a price, as the Washington Post reports, since they receive no“workers’ compensation, unemployment insurance, time off or retirement benefits — all the perks and protections of working for a traditional business.” Customer who utilize the service also seem to be paying a price, considering the (latest) lawsuit that the service is facing for not having properly vetted its workers. And theft of property is only one of the issues in the complaint. Alison Griswold of Slate nailed it when she wrote that Almost everything that startups get right—and horribly wrong—happened at home-cleaning service Handy.

The same could be said of Uber, although it’s interesting to note that Uber so successfully initially marketed themselves as Us v the Taxi Cartel/David v Goliath, that they managed to capture mindshare and continue to grab investor dollars (over $5B last year alone) despite the fact that they’re hemorrhaging money; are facing fines for their failure to pay taxes; there are the sexual harassment and sex discrimination issues; founder Travis Kalanick’s unmitigated arrogance; and the company’s covert use of law enforcement-evading software, what to speak of “the continuous onslaught of litigation in the US for stiffing drivers, swindling taxi companies, eschewing traditional insurance obligations, and skirting regulations—or so the drivers, companies, and state or district attorneys say,” according to Wired. More lately, relatively newly appointed president, Jeff Jones, resigned after just six months (all of those scandals do take their toll), and just last week Uber announced that they’re going to Suspend Autonomous Tests After Arizona Accident. Not surprising: Uber’s autonomous cars drove 20,354 miles and had to be taken over at every mile (by a human driver), according to documents, Recode reported. Read More...

A Rip in the World As We Know It

A Rip in the World As We Know It

There’s nothing like an Internet outage to demonstrate precisely how much power is focused in the hands of the few. Two weeks ago, at 12:47 pm EST, Amazon Web Services experienced a 3S outage for several hours, taking websites, apps and devices either fully or partially down with it. “Affected websites and services include(d) Quora, newsletter provider Sailthru, Business Insider, Giphy, image hosting at a number of publisher websites, filesharing in Slack, and many more. Connected lightbulbs, thermostats and other IoT hardware (was) also being impacted, with many unable to control these devices as a result of the outage,” Techcrunch reported. “Amazon S3 is used by around 148,213 websites, and 121,761 unique domains, according to data tracked by SimilarTech, and its popularity as a content host concentrates specifically in the U.S. It’s used by 0.8 percent of the top 1 million websites.”

“Notably, this wasn’t technically an “outage,” since Amazon’s S3 wasn’t not entirely out of commission and some services were only partially affected,” says Business Insider, which, once again, failed to disclose that Amazon founder and CEO Jeff Bezos was a major investor in the publication.

It was back up some four hours later and as often happens with tech, we’re apoplectic when our devices don’t work for a while, but once all is resolved, it’s usually more or less a case of business as usual, and in the case of the S3 outage, it may well have even given a few people a brief respite from the government listening posts. Read More...

The New Normal

The New Normal

The big news last week was the Snap IPO – the biggest since Alibaba – which raised $3.4 billion for Snap, a company which managed to lose $514.6M last year and has lost money every year since it began commercial operations in 2011,” according to CNBC and, forest through the trees, “has warned that it will never make a profit.”

Facebook tried to buy Snap nee, Snapchat, a few years back for some $3B – pass – so they bought Instagram instead, for the now seemingly bargain price of $1B. Of course, Instagram didn’t have the number of eyeballs that Snapchat did at the time, but since Facebook, um, appropriated features that Snap had innovated – Stories comes to mind – Instagram’s popularity and growth has far outdistanced Snap’s. And remember: eyeballs/exponential growth are the holy grail of Silicon Valley investors and the market. We do know that Twitter has come up more than once in articles covering the Snap IPO, as how long did Twitter skate after the IPO, promising continued user growth, which never materialized. Au contraire, but they did go a good long time with nary a sustainable revenue model in sight, and a falling user base, which does go far in explaining the lack of a buyer for the company.

For the record, ‘growth potential,’ ‘eyeballs,’ – this is the language of Web 1.0, when it was all potential, all the time. The potential was there; the timing was off: the bubble burst. That was then and this is now, and we’re at the Too Big to Fail Stage in the history of tech. Read More...

Crimes, Misdemeanors – and Business As Usual

Crimes, Misdemeanors – and Business As Usual

Move fast and break things. Do more faster. These are the mantras that the tech industry, particular those in Silicon Valley, cut their teeth on. Competition is fierce and timing (first to market) – and perception (category killer: think Google and Facebook) – is everything. So is it a wonder that Uber has drawn so much scrutiny and criticism for its practices lately? On all fronts, it seems.

“Has Uber Gone Too Far this Time? Is Uber involved in a Smear Campaign,?” asks Michael Spencer on LinkedIn, referring not only to former Uber employee Susan Fowler’s blog on the sexual harassment she encountered at the company, which was not unique to her but instead, fairly widespread in Uber’s frat boy culture, according to Caroline Fairchild on LinkedIn.

Then there’s the Google patent infringement lawsuit, which is alleging that Uber is using stolen technology which it acquired through its purchase of Otto, to advance its own autonomous-car development (A Stray Email Caused Google’s Waymo to Sue Uber and Otto Over Stolen Tech). Read More...

The Things We Think and Do Not Say

The Things We Think and Do Not Say

This past week, not unlike Jerry Maguire, Mark Zuckerberg issued a mission statement, with some 5700 words on the goals of Facebook. To refresh your memory, there has been some speculation of late as to whether or not the Facebook founder is preparing a presidential run, presumably in 2024, but now it seems, he has decided that, instead, he wants to rule the world. According to Mashable, with his manifesto, Mark Zuckerberg just said he wants Facebook to save the world. Same difference.

Facebook has certainly been under the microscope lately. Between the so-called fake news (we say ‘so-called,’ as while Macedonian teenagers might have posted misinformation, news sources that don’t necessarily follow lock-step with the world view of the Silicon Valley/global elite were also conveniently lumped into this category and even the ethics of Facebook’s chosen outside fact-checkers are called into question) and streaming suicides, murders and gang rapes, Facebook has become a veritable online Roman Coliseum.

As Zuckerberg discusses the evolution of peoples from tribes to cities to nations, he’s no doubt considering that that’s the progression of Facebook as well, which is in parallel to the global community that Silicon Valley would like to see, with national boundaries as a leftover of a bygone or disappearing era, and isn’t Facebook, after all, a global community without boundaries? The social network does not suffer under the inconvenience of national barriers. Read More...

The New Pathway to Exits

The New Pathway to Exits

Silicon Valley is fond of exits – isn’t a meaningful exit the dream and endgame of every investor and entrepreneur in tech? You have to admire – or shake your head in total disbelief at – Silicon Valley, when it comes to what they’ve managed to accomplish: namely, disrupt a number of industries, as well as the basic principles of economics and business, to get to those astronomical exits, whether or not they were real, or just so much smoke and mirrors.

When Twitter launched in 2006 and started picking up steam after its debut at SXSW the following year, they had no revenue model, but the company’s investors assured us that there would be a revenue model by 2009. Then came the IPO in 2013 and, as The Wall Street Journal noted, “The San Francisco-based company raised as much as $2.1 billion and ended the day with a market capitalization of about $25 billion. That made the six-year-old company bigger than more than half of the firms in the S&P 500 and larger than well-known brands such as Kellogg Co. and Whole Foods Market Inc.”

That was then and this is now, and the company is now worth well under its IPO price and as Bloomberg News notes on the eve of three-year-old Snap going public, Snap’s IPO to Be Haunted by Twitter and GoPro. As MarketWatch warns, Snap’s cost of revenue has exceeded sales for two years, and could grow more. Which is Silicon Valley newspeak for the company is losing money, in case you’ve never read George Orwell’s 1984 and evidently, we don’t know what the hell they’re teaching out there. As for Twitter’s revenue model (what to speak of the fact that the company is hemorrhaging users), we’re still waiting. Read More...

Where Are All the Women Investors?

Where Are All the Women Investors?

Following the Ellen Pao gender discrimination trial, quite a few articles came out about the lack of women investors in technology. We attend many events and panels, and it struck us that we know quite a few women tech investors, so we sat down and made a list of the ones we know in New York alone – and quickly came up with well over a hundred names. So, they’re out there. In New York, anyway.

Not long after having compiled this list (170+ VCs, angels, Corporates and Family Offices), we attended the Demo Day of one of the leading accelerators and noticed something odd: after the presentations, the male investors gathered in small groups to discuss the various companies, while the women dispersed to different stations where the entrepreneurs were answering questions and it struck us that there was something of a disconnect/chokepoint: the proverbial Old Boy networks have been around forever and while the names and faces may change, they’re still very much alive and well, while there’s no such long-standing network/pipeline among women: the women investors don’t necessarily all know each other.

Which gave birth to Ladies Who Lead, an event we plan on hosting quarterly (our 2nd one will be held this Thursday evening) so that the women investors of New York can get better acquainted with each other, in order to facilitate deal flow. Read More...

Robotics, Drones, AI and Autonomous Vehicles: The Fourth Industrial Revolution Is Here

Robotics, Drones, AI and Autonomous Vehicles: The Fourth Industrial Revolution Is Here

Oliver Mitchell of Autonomy Ventures, who also blogs at The Robot Rabbi, spoke at our January 26 Investor Breakfast, and the conversation was column-worthy. After all, the robots are coming and that’s very much Oliver’s domain, and their growing presence on the global landscape, along with other technologies, is being referred to as the Fourth Industrial Revolution, as Oliver pointed out. In fact, the day before the breakfast, The New York Times ran on piece on How to Make America’s Robots Great Again, pointing out how China is investing heavily in the manufacturing of robots, and the US needs to do so as well.

The big fear is that robots will be – and currently are – taking jobs formerly held by lower skilled labor, and the fear is not unfounded. As Oliver noted, they’re also taking jobs in higher skilled areas, even replacing financial analysts and advisors. So are we looking at some relatively far off dystopian future?

“When I was growing up, computers were only used by large corps or government, and with a few highly skilled operators operating them,” said Oliver. “Not until Windows 95 (was introduced) that computers and personal computers became ubiquitous, and really fulfilled the dreams of Bill Gates and Steve Jobs. If I told you a decade ago, or a decade and a half ago, about robots, you’d have thought Robbie the Robot and big industrial robots…Compared to personal computing, we’re standing in 1990 – 5 years before robots become ubiquitous.” Read More...