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  • Jason Calacanis 18:00:00 on 2021-07-17 Permalink
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    Social Media Addiction: Why I’m taking a Twitter break. 


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    For the second time in the past five years, I’ve decided to take a break from Twitter.

    I’m a functional Twitter addict, getting all of my work done and maintaining important relationships while spending far too much time on the platform. 

    When I wake up, I check Twitter before my email and SLACK.

    Before I go to bed, I thrash between Twitter, podcasts, audiobooks, and playing chess.  

    All day long, be it a workday, the weekend, or on vacation, I’m sucked into my replies, trending topics, and Twitter feed. 

    I love it, but sometimes I love it too much. 

    While I don’t regret the time spent there, it is a blocker to getting other things done, and while it’s worth it on so many levels, the truth is it can put even the most optimistic person in a foul mood. 

    The amount of trolling and dunking, which can be entertaining, can sometimes become exhausting. 

    So, I decided this week to focus on two media channels for the rest of the year: my podcasts and my next book. 

    I’m still checking Twitter, and I will retweet things and like them, but I’m not going to reply to folks OR start new tweets. 

    I will automate the sharing of podcast episodes and blog posts to Twitter, so folks know when new content lands, but for now, I’m going to clear my mind and focus on getting my passion–This Week in Startups–to consistently publishing 5x a week. 

    Oh yeah, I also do the All in Podcast weekly now, so that means I’m doing six podcasts most weeks. 

    Now, for most humans, six podcasts a week seems like a lot, but for me, it’s like going to lunch or dinner six times a week with the most exciting people in the world–in other words, it’s nothing. 

    That’s a lot of cognitive work.

    My current plan is to take the rest of the year off Twitter and focused on the podcasts (TWIST & All In) and the book while growing my two startups Inside.com and the LAUNCH fund. 

    The last time I took off six months, I got the book ANGEL done, traveled the world to support it, and that little niche book sold tens of thousands of copies and was translated into 10+ languages… and my angel investing club (thesyndicate.com) grew from 1,000 members to 8,000. 

    So, it’s time to write the book. I’m not ready to talk about the details yet (and I haven’t even sold it), but it’s going to a barn burner. 

    Candidly, I’m more excited with you reading the book in the spring of 2022 than I am getting using Twitter right now. So, I’m going to follow my heart.   

    best Jason

    Note: I did a short audio piece on this decision last night on Racket.com
    https://racket.com/jason/rtY3D

    The post Social Media Addiction: Why I’m taking a Twitter break. appeared first on Jason Calacanis.

     
  • Jason Calacanis 22:51:58 on 2021-07-14 Permalink
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    Rad Power Bike Review: it’s fun! 


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    The post Rad Power Bike Review: it’s fun! appeared first on Jason Calacanis.

     
  • Jason Calacanis 22:09:02 on 2021-05-31 Permalink
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    On 2021 startup valuations 


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    Some folks in our angel investing club (thesyndicate.com) have asked me for my thoughts on the surge in early-stage valuations.

    The market is scorching hot, with startups across all growth stages getting funded faster and at higher valuations. 

    [ Click to Tweet (can edit before sending): https://ctt.ac/GdU89 ]

    The dollar amounts raised are often staggering, but so are the exits — which are driving this.

    When there is a large number of meaningful exits — from Uber to Airbnb to Coinbase — investors get enthusiastic about investing in the next wave of unicorns.

    This causes valuations to quickly double and triple, with investors reporting, “the valuation doesn’t matter if this becomes the next unicorn!”

    Of course, it does matter since most companies go to zero, and you can invest in three startups at a $10m valuation for the same price you would pay for one at $30m. 

    Three swings at bat dramatically increases your chances of hitting an outlier.

    Now, if you could invest in Uber or Airbnb’s angel round, Series A, or Series B, you would certainly do it, but there is no way to know which startup is the next Uber or Airbnb (at least not with certainty). 

    Our firm and investment club are adjusting to this moment to focus on four things:

    1. We are investing in high-quality startups at reasonable prices, as we have always done. 
    2. We are investing in select, very high-quality startups at these higher valuations. 
    3. We are helping existing portfolio companies raise money during this frothy market.
    4. We are meeting with as many startups as possible and noting when we pass because of the valuation so that we can meet with them again in the future. Many times a startup will “catch up” to a high valuation, and the next round will allow us to engage at a more defensible valuation. 

    We invested in Calm, Uber, and Thumbtack for ~$15m — combined. 

    While the $5m Seed round may be over for now, we have seen several pre-launch startups command $15m to $50m valuations. If those startups are led by a serial founder, it’s justifiable, but most of the time, they are first-time founders. 

    We are content to sit out these Seed rounds and wait to see if the startup gets to product-market fit. If a pre-launch startup raises at a $50m valuation, for example, and then gets product-market fit and hits $1m in yearly revenue, the valuation is likely to be $10-25m in a normal market. 

    This “filling in the valuation” strategy is acceptable for founders who have discipline, but it does carry the obvious risks of a down round if they don’t. Most founders seem to understand this, with many telling me, “I know this valuation is crazy, but we are taking advantage of this moment.” I would do the same if I were them, so no judgments — just make sure that you have the runway to fill in that valuation. 

    For investors, you don’t have to hit every winner to be a big winner. In fact, you only need to hit one. 

    In a hot market like today’s, we encourage members of our investment club to evaluate their goals, pace themselves, consider making adjustments to their strategy, and always remain disciplined — by focusing on great founders, quality products, and delighted customers.

    Great founders.

    Quality products. 

    Delighted customers. 

    Those things don’t happen by accident. 

    Best, Jason
    PS – Join us next week for Meet Our Fund, where 25 venture funds are pitching thousands of founders https://live.inside.com/meet-our-fund-j

    The post On 2021 startup valuations appeared first on Jason Calacanis.

     
  • Jason Calacanis 02:54:27 on 2021-04-20 Permalink
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    Republic CEO Ken Nguyen on making early-stage investing for everyone | E1199 


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    Top Takeaways


    • Ken’s worldview: crowd investing is a powerful way to give people around the world access to high-growth opportunities and give companies a way to raise money while creating a deeper connection to their community.
    • Startups are staying private longer, so platforms like Republic are the only way for the average person to get access to private companies.
    • Ken’s goal is to make it easy for people to begin investing for as little as $10. Republic achieves this by streamlining everything related to organization, legal, & compliance.
    • Republic uses a Crowd SAFE, which essentially groups all investors together as one line item on the startup’s capitalization (cap) table. This makes it easy for the company raising money to manage.

    Listen on Apple Podcasts

    Intro


    Ken Nguyen (also appeared on E856)

    • Ken & his parents emigrated from Vietnam to California when he was in elementary school, which partially influences his mission to allow people from all over the globe to invest in great startups.
    • Co-Founder & CEO of Republic (2016-Present)
      • Equity crowdfunding platform
      • Republic empowers everyone to invest in the future they believe in by providing access to startups, real estate, crypto, and video game investments.”
    • Previously:

    Republic’s Funding (more than $70m to date)

    1. $2.1M Seed AngelList, Upventures & others (Dec 2017)
    2. $12M Early Stage VC led by Binance Labs & NGC Ventures (Jun 2018)
    3. $36M Series A at $137M Post led by Galaxy interactive (March 2021)

    Republic Stats

    • 1 million investors on the platform
    • Avg. raise is ~$600k

    Subscribe to the Weekly Recap Newsletter (sample) | Follow TWiST’s Twitter


    Why is crowd investing a new thing?


    • After the Great Depression, Congress enacted legislation that only allowed “accredited investors” (read: millionaires) to invest in private companies
    • All non-accredited investors were deemed unfit to invest in private companies and were banished to the public markets and index funds
    • Investing and financial services continue to be highly regulated.
    • In 2012, Barack Obama signed into effect the JOBS Act (Jumpstart Our Business Startups Act), The JOBS act went into effect in 2016 allowing for some equity crowdfunding
    • Republic focuses on Reg Crowd Funding (CF) and Reg A, these regulations were changed in March 15th, 2021 allowing for more investment:
      • CF: $5M max raise (previously $1.07M, set in 2016 Jobs Act)
      • A+: $75M max (previously $50M, set in 2016)
    • Republic is shaping laws – was referenced over 20 times in 2021 SEC ruling
      • The SEC is moving much faster than Ken though possible (still slower than private companies to protect investors).
      • Ken thinks President Biden’s SEC will move slower at loosening regulations than Trump’s because there is a different focus.

    What it takes to raise on Republic


    • Diligence is required to list on Republic, but legal and accounting fees for new startups to raise is less than $15k (for most it is much less).
    • To use Republic to raise money, companies pay a fraction of the amount they are raising (on average):
      • 6% in cash
      • 2% in stake of the company (this gives Republic upside in the company and an incentive to make sure only good deals come on the platform)
    • Companies that have a large audience and bring investors to the Republic platform will pay a lower fee. You can think of them in two groups.
      • Those looking to find investors from the community that invests on Republic (Low fee)
      • Those with large following that will use this infrastructure to make it easy to raise (High fee)

    Recent big raises on Republic


    • Sahil Lavingia (E1188 ) & Arlan Hamilton (E1080, Angel S2 E5, E772) both raised $5M rounds
      • Gumroad – Sahil Lavingia
        • Crowd SAFE: $5M raised at $100M valuation from 9346 investors
        • Co-investors: Naval, Jason Fried put in $1M as anchor investors
        • 8x price to earnings, over $10M ARR, growing 120% year over year, team of 10
      • Backstage Capital- Arlan Hamilton
        • Crowd IPA: $5M raised – for 10% of future earnings of Backstage capital (~10% carried interest & 10% management fees) from 6958 investors

    “My question for VCs criticizing this model is: If your assessing a b2c business that has such a relationship with his customers that these customers would part ways with 500 bucks, not getting anything back [except equity], just on the belief that one day this company is going to succeed. Is it a good signal or is it a bad signal if a company can convince 10,000 customers?”

    Ken Nguyen

    How power is shifting to the crowd


    • When people are invested in a business they become evangelists for a product. This is especially helpful when a product becomes commodified (like Skyy Vodka Ken used to work for).
    • In 5 years of data from Republic there have not been instances of fraud (this doesn’t mean all investments worked out).
    • There are more reasons than purely financial why people invest on republic.

    “Our tagline is aligning profit and passion. The smaller dollar amount that you enable someone to invest the passion bucket is going to be more and more important in their decision making process.”

    Ken Nguyen
    • Republic’s social component:
      • People can write reviews on the platform, saying why they invested (it also shows amount invested if they check that box).
      • A co-investor is highlighted with their track record of investing.
      • There is a space for discussion on republic
      • See Review Screenshot & Co investors section

    Subscribe to the Weekly Recap Newsletter (sample) | Follow TWiST’s Twitter

    To contribute to the TWiST PodNotes archive email us.

    The post Republic CEO Ken Nguyen on making early-stage investing for everyone | E1199 appeared first on Jason Calacanis.

     
  • Jason Calacanis 19:24:37 on 2021-04-09 Permalink
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    Insights from Giggster Co-founder Hank Leber on building a location marketplace for creators & content production | E1196 


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    Top Insights


    • Building a business on top of another platform is risky, as revenue can go to $0 overnight by no fault of your own
    • Adding simple and easy solutions to archaic industries and business processes can result in rapid adoption
    • Giggster filled their marketplace supply-side first: once there was a large volume of high-quality supply, demand generation was much faster and mostly organic
    • When all sources of revenue are on the line, even archaic industries like film production can adapt quickly
    • Since Giggster has been operating successfully before raising money, they know their unit economics and are comfortable putting together an aggressive growth plan

    Intro / Problems with building on other platforms


    Guest: Hank Leber | @hankleber

    • Co-Founder & Head of Growth, Giggster (April 2019-Present)
    • Website: https://giggster.com
    • Hank previously was CEO of GonnaBE a planning social media app (they presented at LAUNCH Festival). The concept of planning socially wasn’t embraced by users.
      • Lesson learned: if you put out your plans publicly and no one comes you look like a loser.

    “You have an idea that everybody thinks sounds great, then there’s an ugly cultural truth somewhere that makes it not a real thing.”

    Hank Leber
    • Hank also had a company called Vytmn which was a “growth as a service” tool built on top of Twitter
    • Twitter shut down one of their key features, the ability for to automate actions like DMs, which killed their revenue ($1M ARR at peak)

    “… do not build on the back of another platform, if they can kill you, they will, it’s not your money. That’s their money that you’re stealing.”

    Hank Leber

    Giggster’s founding story


    • Hank and his Co-Founder Yuri Baranov were not from the film industry, they are tech entrepreneurs
    • How they discovered the market opportunity with Giggster:
      • Yuri is LA-based and lives in a nice house near the water
      • One day, a production scout knocked on his door and offered him $70K to shoot at his house over two days for CSI: Miami
      • The process included door knocking, clipboards, paper contracts and excel spreadsheets
        • this “business flow” was terrible for a $70K transaction, so Yuri told Hank about it and they started doing some research on the production location industry
        • After realizing the location industry had been run this way for decades, they started Giggster
    • Giggster is a two-sided marketplace for video production, meetings, weddings & events. Think Airbnb for production locations and events.
      • Larger clients would be Netflix, HBO, Hulu, large production companies, etc.
      • Smaller clients would be TikTokers, YouTubers, Vloggers, etc.
    • How Giggster differs from Airbnb and VRBO:
      • Short-term rental platforms do not allow production shoots because they require more overhead: insurance, more people per location then allowed, production parking, waivers, etc.
    • Giggster added a services element because some film production teams need higher-touch support (above $2500-$3000 a day) these services include:
      • Logistics
      • Permiting
      • Power
    • In California, you can rent your home for up to 14 days per year tax free
      • Giggster has some client who shut down their listing after being booked for 14 days for this reason

    Creating the marketplace supply-side first


    “What we’ve found is, chicken and the egg, locations matter first. As long as we have the supply we can generate the demand.”

    Hank Leber on starting a marketplace

    Giggster has almost 10,000 locations on the platform

    • In the early days, they filled the supply-side inventory by:
      • partnering with Hollywood agencies, who already had direct relationships with private property owners
      • they also knocked on doors for early customers
      • filling the supply-side first turned out to be a good decision, as it created an immediate flywheels with renters
    • Customers needed a lot of education, so Giggster built out detailed FAQs and comprehensive signup flows
    • Demand has been strong and scouts are now loading their locations onto Giggster
    • If a major client (Netflix, HBO, etc.) needs a location that does not exist on Giggster, they will hire location scouts to go find and matching location and on-board them
    • Giggster saw an opportunity to expand with cheap inventory from pandemic disruption (commercial real estate, restaurants, etc.)

    Pitching at Remote Demo Day, raising via Jason’s Syndicate


    ” (Regarding Jason’s Syndicate), the money is actually secondary to the quality of the network.”

    Hank Leber
    • Self-funded for 3.5 years while they figured out the business
      • Took ~3 years to build a solid base and infrastructure, and now they are seeing rapid growth
    • Yuri (Hank’s Co-Founder) told him to go try and land Jason Calacanis as an investor, so Hank started reaching out to mutual contacts and eventually got a slot in a Remote Demo Day session over the summer
    • Remote Demo Day format:
      • Seven founders pitch thousands of investors over Zoom
      • Pitches are three minutes each, with a two minute Q&A with judges after
      • After all pitches are finished, the judges vote on their top three and the audience members (accredited investors) vote for their #1 company in a poll
      • One day later, all 7000+ members of Jason’s Syndicate get an email with the recording and a sheet where they can pre-commit a dollar amount to invest
      • Any companies that receive over $200K in interest are syndicated!
    • Giggster was The Syndicate’s largest investment ever
      • According to Hank, the quality of the network of investors created additional value beyond the capital invested

    Giggster’s use cases and emerging content business models


    • Giggster collects 15% from the final host payout as a service fee
    • Daily rates for a shoot range $2-30K per day depending on how high-end the location is
      • the average is around $8-10K
      • Larger long-term deals will hit 7 figures
        • example: ABC renting a mansion for The Bachelor for three months
    • Production came back online quickly during the pandemic, the film industry was really aggressive and inventive about their protocols
      • Even in an industry resistant to change, all of the money drying up overnight caused people to change their minds FAST
    • Giggster holds production companies accountable and cares a lot about reputation.
      • Location marketplaces need to maintain a good relationship with cities & neighborhoods so they can continue to operate
      • Typically the professional production companies have outstanding reputations for taking care of properties, however, a new potential business model is more uncertain…

    TikTok content houses are a new media business model

    • Sway & Hypehouse are the most famous TikTok houses
      • These are new media operations that have very different needs and filming styles than traditional production.
      • They don’t have big camera crews but are also notoriously crazier than a film studio.
      • It’s not cut and dry how to service these creators yet, so that’s where Giggster is attacking the opportunity:
        • They are working to pick the right locations (areas with more space and fewer neighbors), and figuring out the insurance needs to service these new smaller-scale customers

    Scaling Giggster


    • The importance of network relationships and trust is key for B2B. Cold emails work worse in this category.
    • Since Giggster has been operating successfully before raising money, they know their unit economics and are comfortable putting together an aggressive growth plan

    ” [once] you get dollars in the door and deliver real value with product-market fit, adding money to scale is a math equation instead of trying to paint a picture and tricking people into buying your vision of the future.”

    Hank Leber

    The post Insights from Giggster Co-founder Hank Leber on building a location marketplace for creators & content production | E1196 appeared first on Jason Calacanis.

     
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