The Startup Glossary

I had wandered into a foreign land. The people spoke a strange tongue…CAC, LTV, SMB.

How could I join their tribe and learn their ways? I consulted the oracle: Google.


Get the blog before anyone else…subscribe!


The world of startups has a language all its own. When I started angel investing last spring, I found it nearly impenetrable.

Here are some of the terms I hear, and use, the most:

ARR = Annual Recurring Revenue. If you have subscription-based revenue, this is how much revenue you would make from those subscriptions in a year.

Burn Multiple = Measures capital efficiency by comparing how much money you’re losing to how much you’re growing. More here.

CAC = Customer Acquisition Cost. Measures what it costs to get a new customer. If you have 10 customers and spent $1,000 to get them, your CAC is $100. CAC is also measured by channel (Instagram, YouTube, etc.). More here.

Cohort = Customers who signed up at a particular time, usually a calendar month. You look at that group of customers over time and see how many stayed, how many left, etc.

Churn = Customers leaving you. Churn is often measured per cohort to understand which customers are leaving and which ones are staying.

D2C = Direct to Consumer. This is a type of startup that sells a physical product to consumers — think Peloton. It’s a tough business and is avoided by most investors today.

Gross Margin = Your profit margin on each additional sale. You take the revenue and subtract costs like customer support, CAC, etc. This gives you a sense of how much profit you could make as you scale and fixed costs become less of a burden.

Land and Expand = Doing more business with existing customers, like selling them more seats for your software. Closely related to NRR (below).

LTV = Lifetime Value. Measures how much money you can expect to make from a customer. This should usually be 3 times your CAC or more. More on LTV here.

MoM = Month over month. Let’s say you doubled ARR from 2020 to 2021. Your monthly growth would be 6% MoM.

MRR = Monthly Recurring Revenue. The monthly equivalent of ARR.

NRR = Net Revenue Retention. Measures how much new revenue you’re getting from existing customers minus what you lose in churn. Especially relevant for SaaS businesses. Also called Net Dollar Retention (NDR). More here.

PMF = Product Market Fit. Do customers want what you’re selling? If so, you have it.

SMB = Small and Medium Sized Businesses. This usually means businesses with 1,000 employees or less. The term is used to describe potential customers.

SaaS = Software as a Service. Software that customers pay for by subscription. SaaS usually refers to business software, but consumer SaaS is also an important category. These are consumer subscription companies like Calm.

YoY = Year over Year (similar to MoM above).

If you know these terms, life in startupland gets a lot easier! They also provide you with helpful ways to understand a business.

What did I leave out? Leave a comment at the bottom and let me know!

More on tech:

The Top 5 Things I’ve Learned from Angel Investing

Inside the Seed Funding Slowdown

Twilight of the Quick Delivery Startups

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor.

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Photo by Romain Vignes on Unsplash

Top Executives of China’s State Semiconductor Fund Arrested

A major state-backed investment fund in China is in shambles as several top executives have been arrested. From the MIT Technology Review:


Get the blog before anyone else…subscribe!


China’s chipmaking industry descended into chaos last week, with at least four top executives associated with a state-owned semiconductor fund arrested on corruption charges. It’s an explosive turn of events that could force the country to fundamentally rethink how it invests in chip development, according to analysts and experts. 

On July 30, China’s top anticorruption institution announced that Ding Wenwu, the chief executive of the China Integrated Circuit Industry Investment Fund, nicknamed the “Big Fund,” had been arrested for “suspected serious violations of the law.” Ding is not the only person in trouble. Two weeks ago, Lu Jun, a former executive at the Big Fund’s management institution, was also taken into custody, along with two other fund managers, according to the Chinese news outlet Caixin.

‘Made in China’

Let’s back up a bit. In 2014, China’s government created the China Integrated Circuit Industry Investment Fund (CICF) to invest in domestic chip making. Becoming self-sufficient in these critical components is a top priority of the Communist Party.

At that time, China could only make about 10% of the chips it needed. Its goal was to get to 70% by 2025.

The fund made over $30 billion in investments, with $20 billion more planned. But those investments have started to go sour.

The ‘Big Fund’ Takes Big Losses

One of its biggest investments, Tsinghua Unigroup, went bankrupt last year. Unigroup executives are under investigation and CICF’s $2 billion investment is likely up in smoke.

Riven by bad bets and likely self-dealing, CICF has failed to make China self-sufficient in chips. Today, China can only make about 20 or 30% of the chips it needs — well below target.

A Critical Moment

For China, being able to make semiconductors has never been more important. The US and its allies Taiwan, Korea and the Netherlands make virtually all the chips China imports.

The Trump Administration cut major Chinese telecom Huawei off from critical tech in 2019. Now, the US is pressuring Dutch chipmaker ASML not to sell certain chipmaking machines to China.

China is dependent on chip imports and cut off from the latest tech. Its efforts to develop its own industry have been mired in incompetence and corruption.

China’s Missed Opportunity

What should China have done differently?

Rather than giving government bureaucrats a mountain of state money to invest, use real investors!

With the right tax breaks, chipmakers and technology investors would’ve been eager to set up Chinese fabs. Perhaps TSMC would’ve built more plants in China and China would already be self-sufficient.

The Empire Strikes Back

Turns out another country is doing exactly this: the United States.

The recently passed CHIPS Act offers huge tax breaks for making semiconductors in America. Already, Intel, Samsung, and TSMC are setting up plants.

Worse yet for China, the CHIPS act bars companies that get those incentives from investing in cutting edge chipmaking in China.

I don’t think China will succeed in creating a major domestic semiconductor industry any time soon.

Its poor relations with other countries cut it off from foreign help. And China’s politicized investment climate results in little besides bankruptcies and prosecutions.

As much as we Americans complain about our government, turns out they’re actually doing a few things right.

What do you think the future holds for Chinese tech? Leave a comment at the bottom and let me know.

More on China:

Mass Protests in China as Bank Runs Continue

How China’s Tech Industry Dies

China’s Crypto Ban and the Road to Total Control

Photo: “Semiconductor factory in Shenzhen, China” by ILO in Asia and the Pacific is licensed under CC BY-NC-ND 2.0.

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

Male Contraception with One Simple Shot

For generations, preventing pregnancy has fallen mostly on women. Men have few ways to help, aside from often ineffective condoms.

With abortion now illegal in many states, the need for contraception is the greatest in 50 years.


Get the blog before anyone else…subscribe!


So I was excited to learn today about an amazing new male contraceptive called Contraline.

Contraline is an injectable gel that blocks sperm before they’re ever released. It has no effect on hormones and ejaculation happens as normal.

The roughly 30 minute procedure happens in an outpatient clinic and remains effective for at least a year.

The gel, called ADAM, is set to enter clinical trials this year.

It works by setting up a barrier in the vas deferens. This barrier blocks the sperm from leaving the body.

When the gel has reached the end of its lifespan, it liquefies, removing the barrier.

Development of male contraceptives has long been stifled by a lack of research funding. Government grants have gone mostly to contraceptive options for women.

But as more federal dollars and venture capital pour into male contraceptive development, things are beginning to change.

University of Minnesota researchers have developed a male birth control pill that’s 99% effective in mice. They hope to begin human trials this year.

A contraceptive gel for men is also in development. But that too is likely five years or more from market.

Should Contraline or another male contraceptive come to market, couples would have more options than ever. Many women find IUD’s painful and birth control pills fraught with side effects.

What’s more, men have had to trust their partners to handle contraception. If men could do it themselves, society may look much different.

John Reynolds-Wright, a male contraceptive researcher at the University of Edinburgh, may have said it best:


“Maybe I’m overstating how exciting it is, but I always think of it like the iPhone. We couldn’t have imagined how the iPhone would impact on our lives until it was invented. And actually, this is something that’s got the potential to completely, radically change how we talk about family planning, about relationships, about sex.”

I hope the awesome team at Contraline can get their product to market and change the lives of couples worldwide. If men and women can share the contraceptive burden more equally, we’ll have a better world!

What do you think the future holds for male contraceptives? Leave a comment at the bottom and let me know!

Have a great weekend everyone! 👋

More on tech:

Male Contraception With an Ultrasound Device?

Inside the Seed Funding Slowdown

The Top 5 Things I’ve Learned from Angel Investing

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.

Hedge Fund Giant Tiger Loses Over $18 Billion — Long Fund Down 64%

Note: This is not financial advice.

Hedge fund colossus Tiger Global Management is fighting for its life. Its public stock funds have lost between 50 and 64% this year, vaporizing billions.


Get the blog before anyone else…subscribe!


From a report that broke last night in the Financial Times:

Chase Coleman’s hedge fund Tiger Global ended the second quarter nursing heavy losses amid a tech stock rout that has caused performance across one of the world’s largest hedge funds to plummet.

A long-only fund the firm manages ended the second quarter down 63.6 per cent after fees, according to a letter sent to investors seen by the Financial Times, while the firm’s flagship fund ended the first half of the year down 50 per cent after fees.

Tiger’s public stock funds managed $35 billion at the end of last year, per the Financial Times.

This puts the firm’s losses in stocks for the year at a bare minimum of $18 billion. Those losses could be much larger depending on the relative size of the flagship and long-only funds, which is not publicly reported.

This comes in addition to massive losses in private tech startup shares:

A “crossover” strategy fund, which blends Tiger’s publicly traded and privately held investments, shed nearly 37 per cent on a net basis in the first half of 2022.

After huge losses like this, the brutal math sets in. Hedge funds have to make back all of their losses before they can start charging performance fees again.

Hedge funds generally charge a 2% management fee and take 20% of all investment gains. That 20% performance fee is how hedge fund billionaires are made.

Without those juicy fees, it’s hard to keep talent.

Tiger’s long-only fund will have to triple before it can charge a performance fee again. Even if it posts solid 10% annual returns, that will take 11 years.

Even the flagship fund has to double its capital before those fat fees kick in. How many aspiring masters of the universe want to wait that long?

Worse yet, Tiger has cut its management fee to just 1% through December 2023. It also cut its performance fee to just 10% until it not merely makes up all its losses but posts significant gains.

This lack of fees will make it hard to get and keep good people. Why not just jump ship to a fund that isn’t so far underwater, or start your own?

I expect Tiger will close the long-only fund. It’s just too far gone.

As for the flagship fund, perhaps they’ll fight their way back to even with a skeleton crew. I wish them luck — it won’t be easy.

Tiger’s massive losses show the risk of heavily concentrated bets. Going all-in on a single sector with a small number of stocks can result in disaster.

Tiger’s investors would’ve done better to buy a low-fee index fund like the Vanguard ones I own. It’s hard to outsmart the market.

What do you think the future holds for Tiger and other hedge funds? Leave a comment at the bottom and let me know!

More on markets:

AMC’s 9 Million Missing Shares

Wall Street Banks Turn on Each Other as Federal Probe Looms

Investors Pull $28 Billion from Hedge Funds

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

North Jersey’s Secret Campground

We went deeper and deeper into the forest. Tents and shelters disappeared, replaced by foxes, deer, and silence.

We pulled up to a small clearing, scarcely another human in sight.


Get the blog before anyone else…subscribe!


The road to Steam Mill

This is Steam Mill Campground in Stokes State Forest. The 16,000 acre park in northern New Jersey is popular with campers, but today we were off the beaten path.

This beautiful spot is less visited than other camping spots in Stokes. The sounds of music and conversation were replaced with bird calls.

Deer near Lake Ocquittunk

Dinner was an incredible coq au vin courtesy of our friend Jim*. A lengthy reduction of the broth left it redolent of bacon and wine.

We weren’t the only ones who loved the smell. As darkness fell, an adorable baby raccoon wandered onto our campsite!

Our friend Roscoe

He was so tame, he rubbed against my leg like a cat. My friend Tim* named him Roscoe.

As he ambled back into the forest, we heard his mother scold him with a loud shriek. I guess little raccoons can be as naughty as little humans.

Our days were for exploring.

Tillman Ravine

We hiked Tillman Ravine, a steep and dramatic landscape of rock and evergreen. It reminded me of the hills and pine forests of the Pacific Northwest.

After a short hike, our friend Victor* casually mentioned “I think the car is this way.” Some campers prefer the hot dogs to the hiking. 🙂

Towering evergreens at Tillman Ravine

Eager to go further, I took a long stroll down an abandoned fire road. The isolation and quiet does wonders for the mind.

But I wasn’t entirely alone. A huge barred owl glided across the path and landed in a tree, looking down at me.

Look closely…

In all our lives, what were the odds that we’d ever see each other? But I’m glad we did!

That night, unexpectedly heavy rain came down. I suffered a catastrophic tent failure and ran to the car.

Settling into the dry seat, I was so grateful for civilization. Sometimes you need to rough it just a bit to feel that gratitude.

Despite its remote location, Steam Mill is quite livable.

There’s delicious spring water on tap a short walk away. Many sites have platforms for tents and there’s even a bathroom…sort of.

The toilet seat is like the one you have at home, but it sits above a deep pit. 😨 It may not be the Four Seasons, but it’s serviceable.

Flush toilets and showers are a couple of miles away at the Lake Ocquittunk camping area, among others.

If you yearn for quiet and wildlife, Steam Mill is for you. It’s a bit less comfy, but the tranquil beauty makes it more than worthwhile.

Hope to see you there!

What are you favorite natural spots? Leave a comment at the bottom and let me know!

More on the outdoors:

A Hidden Castle…In New Jersey?

The Real Groundhogs of New Jersey

Pine Barrens Glamping in Brendan Byrne State Forest

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order. 

*Not their real names.

AMC’s 9 Million Missing Shares

Trading in shares of AMC Entertainment Holdings Inc. just gets stranger and stranger.

A new report from the SEC shows fails to deliver dropped to 205,675 shares in the first half of July, the latest reporting period. This is down from a high of nearly 9.7 million just two weeks ago.


Get the blog before anyone else…subscribe!


So, were exchanges busy little bees cleaning up over 9 million shares worth of failed trades?

Maybe. Or maybe those shares went somewhere else…

The Depository Trust & Clearing Corporation (DTCC) settles most US securities transactions. It has an “obligation warehouse” where it puts failed trades.

Once those failed trades go to the obligation warehouse, they basically cease to exist.

We don’t know for sure if that’s what happened with these 9 million shares because the SEC and DTCC won’t tell us. But given the complexity of settling that many failed trades, I’m willing to bet the DTCC just wiped the slate clean.

So why does this matter?

Allowing huge numbers of trades to fail enables naked short selling. Naked short selling is selling short shares without borrowing them first.

It’s a powerful way to push down a stock’s price. After all, if you don’t have to find shares to borrow, you can short as many shares as you want!

No wonder Compliance Week calls it “one massive embezzlement scheme that for years has mostly gone ignored.”

Why would the DTCC do this? Perhaps because of how it’s funded.

The DTCC makes money by clearing trades and is owned by its users.

Hedge funds are some of its heaviest users.

No wonder the DTCC just sweeps trades under the rug instead of investigating what happened.

The SEC should investigate the pattern of massive fails to deliver in stocks like AMC. And the DTCC must ensure trades are actually completed.

Until then, we’ll continue to see these shenanigans in markets.

What do you think happened to these 9 million shares? Leave a comment at the bottom and let me know!

More on markets:

AMC Fails to Deliver Hit 9.7 Million

How DTCC Makes Fails to Deliver Disappear

Wall Street Banks Turn on Each Other as Federal Probe Looms

Get the blog before anyone else…subscribe!

If you found this post interesting, please share it on Twitter/Reddit/etc. This helps more people find the blog! 

Save Money on Stuff I Use:

Fundrise

This platform lets me diversify my real estate investments so I’m not too exposed to any one market. I’ve invested since 2018 with great returns.

More on Fundrise in this post.

If you decide to invest in Fundrise, you can use this link to get $100 in free bonus shares!

Misfits Market

I’ve used Misfits for years, and it never disappoints! Every fruit and vegetable is organic, super fresh, and packed with flavor!

I wrote a detailed review of Misfits here.

Use this link to sign up and you’ll save $15 on your first order.