Weekend Briefing No. 236
Welcome to the weekend.
72,000 – Drug overdoses killed about 72,000 Americans last year, a record number that reflects a rise of around 10% since 2016.
2053 – 2053 nuclear explosions have taken place between 1945 and 1998. This time lapse video begins with the Manhattan Project's "Trinity" test near Los Alamos and concludes with Pakistan's nuclear tests in May of 1998.
8 – The average person today receives more information on a daily basis, than the average person received in a lifetime in 1900. The average person gets 1 interruption every 8 minutes.
$100 Million Was Once Big Money for a Start-Up. Now, It’s Common. Known as a mega-round in Silicon Valley, large-scale fund raising is producing a frenzy around tech companies with enough reach and momentum to absorb a large check. In the last 14 days, Letgo, an online classifieds ads company, raised $500 million. Actifio, a data storage company, took in $100 million. MyDreamPlus, a co-working space start-up, secured $120 million. And Klook, a travel activity booking site, got $200 million.These mega-rounds have become so common that CB Insights, which tracks start-up investments, has even debated lifting its definition of a mega-round to $200 million or more. Many new investors, including SoftBank’s $93 billion Vision Fund, manage funds so large they dwarf the entire traditional venture capital market in the United States. These giant funds are looking for start-ups that can take large sums of money with one shot. Writing lots of small checks is too time-consuming, and the returns from small bets will not make a difference for a such a big fund. So, investors are competing to back any start-up that shows promise and the ability to put $100 million or more to use. New York Times (8 minutes)
This is a fantastic thread about how chasing the mega round can distort the priorities of a company. A founder in a very competitive market was relaying the journey of her company. Her competitors raised ~$100m+ from VCs but she struggled to raise ~$4m. she struggled because: 1. the co. wasn’t a “perceived” leader by investors, so raising was hard. 2. investors believed the market was “winner take all” and only wanted to make positions in a “leader”. She had either a choice to give up and sunset the company or build something that was sustainable. she chose the latter. getting to profitability forced her to: 1. focus 2. constrain 3. do one thing well, i.e. deliver revenue. While she was acquiring paying customers, her competitors continued to raise capital to gain market share. By market share, these were customers who were not paying but on trials. Interesting "breaks" started to occur for her. These competitors started to take action that's required (often) by VC-backed + perceived "winner take all" markets. 1. competitors ramped sales people so quickly that customer churn occurred. 2. market share! = always mean great unit economics 3. valuations didn't match metrics. So, now around 1.5-2 years passed and she's still growing her company profitably by 80% YoY (not 200% YoY like her competitors were doing when they raised VC). She's starting to notice competitors are laying off talent and now struggle to raise. In something she didn't expect (and when she shared this, "we had to make these hard decisions to stay alive and funny enough, and I guess that's how timing works, we're now inundated with VCs wanting to write 8-figure checks because we outlasted." @daveambrose (5 minutes)
Best of Intentions
A recent report entitled Best of Intentions reads like a theoretical generosity-inspiring playbook, chronicling the findings from several experiments that have nudged people toward auditing their own behavior and then acting more altruistically. More Americans feel like people should be acting at least twice as charitably as they really do. While most of us feel like people should be giving around 6% of their annual income to charity, the typical person actually gives about half that—only 3% overall. The gap between ambition and action leaves behind a huge sum of potential donations: about $291 billion. Best of Intentions gives tips to non-profits on how to close that gap. Fast Company (4 minutes)
The gig-economy ecosystem was supposed to represent the promised land, striking a harmonious egalitarian balance between supply and demand: consumers could off-load the drudgery of commuting or grocery shopping, while workers were set free from the Man. In recent months, however, a spate of lawsuits has highlighted an alarming by-product of the gig economy—a class of workers who aren’t protected by labor laws, or eligible for benefits provided to the rest of the nation’s workforce—evident even to those outside the bubble of Silicon Valley. A July report commissioned by the New York City Taxi and Limousine Commission found that 85 percent of New York City’s Uber, Lyft, Juno, and Via drivers earn less than $17.22 an hour. When the California Supreme Court ruled in May that delivery company Dynamex must treat its gig workers like full-time employees, Eve Wagner, an attorney who specializes in employment litigation, predicted to Wired, “The number of employment lawsuits is going to explode.” Vanity Fair (10 minutes)
The Ethical Operating System (or Ethical OS for short) is a toolkit for helping developers and designers anticipate the future impact of technologies they’re working on today. It is designed to facilitate better product development, faster deployment, and more impactful innovation — all while striving to minimize technical and reputational risks. The hope is that, with the Ethical OS in hand, technologists can begin to build responsibility into core business and product decisions, and contribute to a thriving tech industry. The Ethical OS is already being piloted by nearly 20 tech companies, schools, and startups, including Mozilla and Techstars. We believe it can better equip technologists to grapple with three of the most pressing issues facing our community today: If the technology you’re building right now will someday be used in unexpected ways, how can you hope to be prepared? What new categories of risk should you pay special attention to right now? Which design, team, or business model choices can actively safeguard users, communities, society, and your company from future risk? Techonomy (7 minutes)
This week in CRISPR news… For the first time, scientists have wielded CRISPR to track a mammal’s development from a single egg into an embryo with millions of cells. The technological feat brings biologists a step closer to being able to trace the history of every one of the billions of cells in complex animals such as mice — offering an unprecedented window into development and disease. A new technique called “barcoding” can help to answer open questions about a mammal’s development. By examining brain tissue from embryos, they found that the barcode patterns were more similar between equivalent regions of the left and right side of the brain — indicating they had formed from recent cell divisions — than between cells from different regions of the same side. This pattern suggests that the axis that runs from front to back of the brain is formed before the one that runs from left to right — a timeline that neuroscientists have struggled to pin down with existing tools. Nature (8 minutes)
Id of Tech
Is Elon Musk crazy? No. Elon Musk has become the id of tech. But his desires and needs are never unconscious or hidden; they are all out there in the brightest Technicolor for all to see. In the oddest of ways, he is transparent, so utterly direct that it is unsettling and even painful at times to those around him. Silicon Valley, all too often is a lot of big minds chasing small ideas. (Think Uber for X). But since Steve Jobs passing, Elon has stepped into the void as a big mind chasing big ideas. New York Times (7 minutes)
From the Community
My friends at GoodOps are featured in Fast Company article about an apparel company that wants to hold the fashion industry accountable for working conditions–by publishing the salaries of everyone in its supply chain.
The Dude abides. — The Dude
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Photo by Collin Armstrong