Sydney Launch Festival + Angel: How to Invest in Technology Startups

This time last week, I was in Sydney attending Launch Festival, hosted by Jason Calacanis (pictured above with yours truly). I can honestly say that I got more out of the two days then the cost of flights, hotel and meals! The ticket itself was free for me as a founder of Abide.

The free founder pass was a great motivation to go because even though I had to go to a different city, I could take the plunge because for me, at worst, I could have a bit of a mid-year break in Sydney. I didn’t attend Myriad or Qode because the tickets were so expansive. I did attend Startcon but only because I scored free tickets. Would I pay to go to Startcon? No, because the talks at Startcon weren’t anything special. But the majority of the talks at Launch Festival provided enormous value.

One the first day, the best talks were Superhuman’s Rahul Vohra’s talk on “The Product-Market Fit Engine”. The talk was about creating a leading indicator by asking users “how would you feel if you could no longer use the product?” and measure the percentage who answer “very disappointed.”, “somewhat disappointed” and “not disappointed”. The way to build a product-market fit then is to focus on the “very disappointed”, figuring out how to keep them. Also, figure out how to convert the “somewhat disappointed” into “very disappointed”. It also means forgetting about the “not disappointed” because there is a good chance that you cannot get to that group without compromising your vision.

I also loved the talk from Shaun Abrahamson on “Reimagining Cities: a Guide to the Future for Startups & Investors”. He used the words catastrophic climate failure in the context that there are already people building businesses under the assumption that we will have a catastrophic climate failure. Whether you believe that we are doomed or not, I am all for cities feeding cities and being more self-contained.

I also enjoyed the panel discussions on both day one and two. I enjoyed the in-depth look at how Masterclass became a successful startup during the fireside chat with David Rogier.

From day two, I learnt a lot from the presentation of Allen Chen of Fitbod who spoke about Growth Metrics that Matter. The talk was about the limits of taking user acquisition and other numbers at face value. Because if someone downloads your app, Fitbod is an app, but never uses it, do you really have a user? This is a simplification. I haven’t been able to track down secondary material on the talk. But I want to!

I also loved the talk from Charles Hudson of Precursor VC on “How Not to Mess Up Seed Round in 2019”. I am not in a position at the moment to raise a seed round with Abide, but it’s always good to be pre-prepared.

Speaking of which, following the festival, I listened to Angel: How to Invest in Technology Startups by Jason Calacanis. It was an incredible look at the other side of the startup world. I am not about to become, but hopefully, Abide will soon be in a position where we will need Angel investors. So it’s always great to research ahead and be a bit better prepared.

Back to the festival. Launch also had a demo pit and a competition to get into Jason Calacanis’s accelerator. I enjoyed the pitches and the demo pit. I was able to make a small connection between the Bee App and my cohort mate from Elevate+, Bee One Third. Maybe something fruitful will come from that!

Overall, it was fun. I had a good time, learnt a lot and also got to have a little mini holiday in Sydney and spend some time with my cousin. So all in all, a week well spent!

"The Thank You" Economy": Out of date but not entirely!

One of the books recommended by the Elevate+ accelerator program is “The Thank You Economy” by Gary Vaynerchuk. The book ends with Vaynerchuk saying that he believes that the book’s content will be outdated by 2015. The prediction is partly correct because large parts of the book are advocating the use of social media by businesses. The book was written in 2010 and the audiobook recorded in 2011. Social media was new and shiny, with not a lot of business presence. But since then, the business has moved in with a vengeance!

Vaynerchuk alludes to the business takeover of the social media and comments that “marketers like myself ruin everything and I am sure they will ruin social media too”. Indeed, I feel less connected with friends and family when I am on Facebook., which is sad because the whole reason I started using Facebook was to keep in touch with my family when I moved to England. Twitter and Instagram I didn’t use much until I started getting into startup land. So I don’t expect either to make me connect to my family. But Facebook was different. It’s like marketers taking over Tumblr and Livejournal, I got both to stay to do Fandom stuff. Marketing muscling into those platforms feel wrong.

All that said, large parts of the book are still applicable. Especially about the part about poor customer service having the potential to be magnified to insane degrees. Additionally, part of the reason marketing has ruined social media is because of “push techniques” that Vaynerchuk advocates against. Of course, we now also have other issues with social media. For personal branding, you need to watch what you say because old jokes can come back to haunt you, and if you do have a sketchy social past, it pays to have a brand adviser run a check on you and clean things up.

Is it sad? I guess, but one of the things Vaynerchuk pointed out was that Social Media has turned the world into a small town. One of the many downsides of a small town was gossip and the long memory. You never lived down anything because at least someone remembered. Some busybodies in small towns and villages made it their business to remember everything. That’s social media. We have delegated a lot of our emotional labour to social media. We don’t write annual letters, we don’t keep our phone books updated. We broadcast and hope people hear. So we have to take the good with the bad.

As for marketing, I think it has its uses for startups like Abide, which is now on Facebook, Twitter and Instagram. But it is harder to get noticed now that everybody is here. But that was bound to happen. As for the next big trend? One of the participants of QUT Collider Accelerator is the startup Air Syne. So maybe the future is VR ads! Perhaps I should get in on that on the ground level!

Bad Blood

I finished listening to the Audiable version of Bad Blood, and it was stunning! I cannot believe that this company did not raise red flags left, right and centre. The truth, of course, was that it had. But because of NDAs, information silos, FOMO among executives and the inner circle culture of super wealthy, Silicon Valley etc., the flags weren’t picked up. More than that, all you have to do is look at the two public whistle-blowers to know why the scam went on for so long!

The whistle-blowers were young, and one of them was Tyler Shultz. Yeah, Elizabeth Holmes and Theranos still managed to make his life a hellish nightmare in the short run, but he’s was still Tyler Shultz, and he was going to land on his feet long term. The same wouldn’t have been true of the Indian employees on skilled migration visas.

I think Theranos is a cautionary tale that goes beyond entrepreneurial culture. Be optimistic but don’t be blind to reality. Also, we need to stop worshipping the dropouts. I mean, yes, Bill Gates and Mark Zuckerberg dropped out, when they dropped out they 1) had their respective business ideas, 2) had the necessary skills or could teach themselves the skills they needed to make Microsoft and Facebook a success.

Steve Jobs spent a lot of time auditing classes after he couldn’t continue with the university. I understand it was a money issue in his case. Also, Steve Jobs had Steve Wozniak as his partner and Wozniak was a brilliant engineer. Finally, Google’s Larry Page and Sergey Brin dropped out of PhD programs!

You can’t teach yourself medical science. Elizabeth Holmes also didn’t have a Steve Wozniak character by her side. Besides which, what she wanted to do needed scientific and technological breakthrough to become a reality. I read a few comments that suggested that Holmes’s fixation on the bells and whistles. Stuff like the font on the website or the look and feel of the Edison Machine was her channelling her boundless energy into tasks that she could do because she didn’t have the technical know-how to work in the lab.

She wasn’t a Steve Jobs, but she might have been an Elon Musk if, like him, she stayed in school and got a technical education. The saddest part is that many still believe Elizabeth Holmes was unfairly treated. They think she did nothing wrong. She’s blindly defended by many women, but her defenders are wrong! She hurt people.

I am not going to speculate whether she set out with good intentions and then went down the wrong path. That’s not important. What is important is how she went about doing business was not a good way to achieve anything. She hurt patients, she hurt her employees, including Ian Gibbons who committed suicide. Indeed, Ian Gibbons’s story made me the saddest because he stayed with Theranos because his work defined his life. So he couldn’t walk away, even when he was suffering, because, without his work, he felt he was nothing.

I have no doubt that sooner or later, people will forget about Theranos. People are already forgetting the GFC and many people do not know about Enron or understand the Dot com clash. Theranos was not as big as GFC or Dot com clash, nor was it an Enron. But I think entrepreneurs and businesses owners of all shapes and sizes have a lot to learn from this saga.

Blink

I finished this book in March, but life kept me busy, and I didn’t have a chance to sit down and reflect on it. I enjoyed the book very much. It certainly helped me understand why some of the people around me work the way they do. I especially liked how the book took the time to highlight the negative side of snap judgements, but also advocated for deciding on the spot when appropriate. The big message for entrepreneurs from the book, I think, is the caution around market research, customer profiling or even getting feedback. Because the book makes it very clear how hard it can be to get people to explain why they think the things they do.

There are also lessons to be gleaned from the book when judging pitches or business concepts. Blink can help with bullshit detection because if you stop to think, a charismatic person can convince you to go against your instincts. In fact, the book I am listing to currently through Audible is Bad Blood. I cannot help thinking that a lot of Bad Blood happened because people simply refused to listen to their instincts. But that’s for the next post!

Extreme Ownership: How U.S. Navy SEALs Lead and Win

Extreme Ownership was a book that was originally on the MIT Bootcamp reading list, but I noticed that it was removed from the most recent list. I am not sure why because the book is pretty good. Listening to the book, because I went with the Audible version, straight after Made to Stick was interesting because Extreme Ownership told a lot of stories. But the stories were told with a purpose, and you understood the importance of extreme ownership.

I was going to write a bit more, but I think I’ll let one of the authors speak for himself by putting his TEDx talk. But the big take away is that don’t play the blame game. Take responsibility and act decisively. But that is not to say you have to keep malfunctioning parts around. But it is your job to remove, replace or support to improve members of your team who are not performing. So yes, another book I would recommend!