As a startup founder myself I spend a lot of time reading and (writing). One thing I look forward to is listening to Podcasts. Here are 5 I frequent. They push my thoughts Masters of Scale – Hosted by Reid Hoffman it is wonderfully produced and brings in a lot of insights as founders open up like never before.
I love to dig through Jason Cohen’s (CTO WP Engine) posts and look what I found – The Fermi estimation for Startup business models. This is an interesting and quick method to figure if your estimates have any legs at all. So what is Fermi’s Problem? Wikipedia says “ The estimation technique is named after physicist Enrico Fermi as he was known for his ability to make good approximate calculations with little or no actual data. Fermi’s problem typically involve making justified guesses about quantities and their variance or lower and upper bounds.”
David Cummings recently wrote about re-evaluating the current methods of startup funding and proposed a structural change more conducive for funds to keep flowing for Startup investments. His solution is revenue financing – which is like a high (but adjustable) interest loan both in terms of interest and period that provides the much necessary cash to fund the initial stages without the Angles or investors loosing it all.
You would wonder if all seed stage startups are created equal. Well they are not. Investors always found a flavor of the year in most positive investment scenarios and backed ideas that seemed right for some disruptive value with the potential of a hockey stick growth. Fintech, Blockchain, AI/ML – you get the drift.
According to CB Insights there are 361 Unicorns in the world. A recent report in Strategy + Business reveals China has about 200 startups less than 10 years old and have valuations of 1B or more. 70% of them are preparing to go global.
I have been a fan of Guy Raz and How I Built this from NPR. I look forward to its episodes and have heard some truly fascinating stories of grit, determinations and growth. This is where I heard the Whole Foods Story from John Mackey ( remember the multibillion dollar Amazon acquisition?), of Jerry Murrell of Five Guys and a Burger, Melanie Perkins of Canva and today James Dyson and his vacuum cleaner story.
There is normally a lot of hype around any new tech that comes into the horizon. Specially those VC’s think will deliver the next bunch of Unicorns. Last year it was Blockchain (and the mad rush of ICO’s when unthinkable amounts of money was raised on the back of white papers). This year it is AI/ML. There is hardly a product that does not have a customer slide on AI. And how their cutting edge disruption will be driven by AI. A lot are deep fakes. Some are onto something. A lot simple decision tree based outputs.
Some one had to call it out. Fred Wilson did. Why call the “highly valued venture backed startups” Unicorns? In his post yesterday in his much read blog avc.com he suggests ‘Whales’ instead. Whales are rare but whales are real. Just like the highly valued startups.