Tremendous

An angel investor's take on life and business

  • Hedge Fund Andurand Loses Majority of Fund

    Pierre Andurand was sure oil prices would soar in 2023. He placed massive bets. Now, one of his funds faces an existential crisis.

    From a report out this morning in Bloomberg:

    Oil trader Pierre Andurand’s losses deepened this month, with his hedge fund slumping to its worst-ever phase of decline.

    His main Andurand Commodities Discretionary Enhanced Fund, which makes leveraged bets, fell by another 7% this month through June 23, extending this year’s losses to about 51%, according to an investor letter seen by Bloomberg News.

    Andurand buys energy options, hoping to profit on huge price swings. This year, he expected oil to surge due to China’s reopening.

    Instead, the price has fallen on a tepid global economy. This resulted in huge losses for the star trader.

    Commodity options are notoriously risky. A small swing in price can quickly wipe out a leveraged position.

    Andurand has never taken losses this large. Despite many years of strong performance, a loss of the majority of the fund could spook investors.

    The key is psychology. If people see you down by more than half, they assume you can go down all the way.

    And they certainly don’t want to be there when it happens.

    Hedge funds under pressure frequently see huge withdrawals. This leaves the fund hurriedly selling positions at whatever price it can get.

    In such a downward spiral, the best employees leave as well.

    Perhaps Pierre will make another risky bet that saves the firm. But that may only delay the day of reckoning.

    The most successful investors over the long term buy great assets and hold them forever. That’s the group I want to be in.

    What do you think the future holds for Andurand? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    Correction: An earlier version of this article estimated Andurand’s losses at over $1 billion.

    After publishing the article, I heard from a representative of Andurand. They explained that while one fund is down over 50%, Andurand manages four funds.

    Since Andurand refused to disclose the size of each fund, it’s impossible to estimate the dollar losses here. So, I removed references to any specific dollar amount.

    Since the fund that took the large loss is the main fund, per Bloomberg reports, I assume the loss is quite significant. But without more transparency from Andurand, we cannot know the exact size of the loss.

    I always strive to bring you the most accurate, up to date information. When more information becomes available, I will let you know about it right away, as I have in the past.

    More on markets:

    Short Sellers Lose $120 Billion in 2023

    Carl Icahn Losing $900 Million a Day

    Druck on the Coming Debt Crisis

    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. 

  • Late Stage Startups Face Bleak Funding Environment

    Late stage startups are running out of options. For every $3 they want to raise, just $1 is available. From a new Pitchbook report:

    The capital landscape during H1 has not seen significant improvement for late-stage and venture growth companies. The capital supply and demand dynamic is still skewed, with late-stage companies experiencing a particularly pronounced imbalance. Demand for capital in the late-stage sector is about 2.84x more than the available supply—a stark difference compared to the 1.29x overextension observed in the venture-growth stage.

    Getting to Breakeven

    These startups are valued in the hundreds of millions of dollars, if not more. Many have tens of millions in revenue, every year.

    With cash like that coming in the door, there ought to be a path to breakeven!

    I know we sound like a broken record, but investors big and small have told companies to cut burn for over a year now. Many did, making hard decisions to lay off staff.

    Now, those startups are in a strong position.

    Once they hit breakeven, they no longer need to raise money. If they decide to do so, it’s on their own terms.

    The Punitive Funding Environment

    But for startups that refused to adapt, the picture is grim. If they can raise money at all, the terms are often punitive.

    Nearly 1 in 10 funding rounds now includes a liquidation preference above 1x, up from almost none a year ago. You can bet that figure is a lot higher at the late stage, given capital scarcity.

    If a VC invests $50 million at a 3x liquidation preference, that means he gets back $150 million before anyone else gets anything. If the company exits for $150 million or less, he gets it all.

    Nothing for founders, nothing for employees, nothing for early investors.

    When employees find out about this, the best tend to leave. After all, their options may now be worth nothing.

    What’s more, the company becomes hard to finance in the future. Take that cap table to the next investor, and they’re going to squint and say “What is this mess?”

    Late Stage Outlook

    Don’t expect the late stage funding market to ease up any time soon.

    At the peak, the vast majority of capital came from crossover hedge funds. Those funds are largely out of the market, licking their wounds.

    Meanwhile, VC’s are raising fewer new funds. This means they’ll have to dole out their existing capital more slowly.

    Wrap-Up

    Getting to profitability is tough. It can involve saying goodbye to great employees.

    But it beats the alternatives.

    A startup’s ultimate goal is to become an independent, public company.

    This means it will have to get to profitability anyway. Public markets aren’t buying unprofitable tech these days.

    No time like the present!

    What are you seeing in the late stage market? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    More on tech:

    How I Research a Startup

    Masa Pivots to AI

    The Perfect Pitch

    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. 

  • How I Research a Startup

    I’m finalizing my biggest ever investment in a startup. Let me take you inside the research process I used to make this decision.

    • Read the deal memo and deck. Simple, but you’d be amazed how many people don’t do this!

    I read all materials, often multiple times. I extract key passages and take notes on them.

    • Find growth rate and burn multiple.

    For every company, I want to know how much money is coming in the door.

    I also want to know how fast the revenue is growing. I calculate growth rates for the last 6 and 12 months.

    For seed stage, I want to see a company tripling year over year. Around Series A, that may slow to double as the numbers get larger.

    Growth is great, but we also want to make sure startups are capital efficient. If they’re burning $10 to get another dollar in revenue, they don’t have a viable business model.

    So I take the most recent month or quarter’s ARR increase and divide it by that period’s burn. This produces the burn multiple.

    I got a burn multiple of 1.6 for this startup, a very strong result.

    • Calculate market size. I do what’s called a bottoms-up TAM.

      I take all the potential customers and multiply that by the cost of the product. In this case, it’s a SaaS product used by in person stores.

      I found that at least 2 million such stores exist in the US. At the startup’s average pricing of $4200 a year, this yields a healthy $8.4 billion potential market in the US alone.

      I like to see that potential market around $10 billion or so. This gives me a chance of hitting a major outcome.
    • Demo.

    The demo is really undervalued. You can’t judge a product from a bunch of slides.

    I want to see the product in action. And if it’s a consumer product, I want to use it myself.

    Is it pretty? Is it easy to use?

    If so, it just might sell!

    • Meet with the founder. This step is crucial.

    When I meet with a founder, I usually already have most of the financial information. What I’m looking for above all is to get a feel for a person.

    I want to know his personal connection to the company’s mission. Will he give up if things get tough?

    I often like to ask, “Who do you admire?” This founder smiled as he mentioned Elon Musk.

    That gives me a sense of the scale of his ambitions.

    I also ask myself who this person reminds me of.

    In this case, he reminded me of two other founders I’ve met with, Brett and Aaron*. He calmly fielded questions and answered with enormous detail, just as they did.

    Brett and Aaron both run billion dollar companies. Maybe this founder will too!

    • Research competitors.

    I look into the competitors the founder mentioned. But I also look for ones he may not know about.

    In this case, I saw no serious competition. But even if there had been, it doesn’t mean the deal is a no-go.

    It just means they need a great strategy to win.

    • Research co-investors. The first question I get from most investors when I send them a deal is “Who else is investing?”

    I don’t operate that way. I make my own decisions.

    But I do want to know who else is in a deal. If top investors are joining, it’s a small plus.

    Decision Time

    I read over everything in the research document I’ve compiled. What’s the overall picture of this company?

    In this case, I had a great founder taking on a huge, untapped market. His traction was impressive, reaching millions in revenue in just 3 years.

    Since I first invested two years ago, he’d done everything he said and more.

    So I decided to re-invest!

    My last step is to write a short memo on why I’m investing. I keep it to a couple of hundred words.

    This forces me to be clear on why I’m making an investment. Win or lose, I can go back and check the quality of my thinking.

    In total, the whole research process took me a little over five hours for this company. That’s on the high side for me — I usually spend about 4 hours on research before saying yes to a startup.

    For companies that don’t make the cut, the decision could come in just a few minutes.

    But when I’m on to something good, I like to dig deeper. But I also keep in mind that eventually, I have to make a decision and move on to the next bet.

    In the end, we can’t control outcomes. All we can do is improve our process.

    My hope is that with enough carefully considered bets, I hit that home run.

    How do you research a startup? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    *Not their real names

    More on tech:

    The Perfect Pitch

    How I Pick Companies and More at the Single Family Office Summit

    The Trait of the Greats

    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. 

  • Office Towers: The New Dead Malls?

    When I was little, my mom and I used to love strolling through the Park Plaza Mall in Oshkosh, WI. Crowds of shoppers bustled past neon signs for Younkers and Maurice’s. Today, all of that is gone.

    All that remains are a few tomblike offices. The once-crowded corridors are so empty that a dance school practices in them.

    Is this the future of office space?

    The Fall of the Office Tower

    From a new report in Bloomberg:

    In New York and London, owners of gleaming office towers are walking away from their debt rather than pouring good money after bad. The landlords of downtown San Francisco’s largest mall have abandoned it. A new Hong Kong skyscraper is only a quarter leased

    A tipping point is coming: In the US alone, about $1.4 trillion of commercial real estate loans are due this year and next, according to the Mortgage Bankers Association. (Other estimates are a bit lower.) When the deadline arrives, owners facing large principal payments may prefer to default instead of borrowing again to pay the bill.

    The value of office buildings are projected to fall by 35% from the peak. Recovery may not come until 2040.

    And You Thought Remote Work Was Bad

    Remote work is killing the office tower. Only half of workers in New York are back in the office, according to building security company Kastle Systems.

    As bad as remote work has been for offices, AI may be even worse.

    Many tech companies have hiring freezes today. With AI making each employee more efficient, those hiring freezes could last for years.

    Fewer, more productive employees means people waste less time coordinating with each other. It’s also a lot cheaper.

    AI hiring freezes mean that even if workers do come back to the office, there will be fewer of them. The demand for office space stays depressed.

    So What Do We Do With Them?

    The aging 70’s and 80’s towers filled with grey cubicles are done. They’re the new dead malls.

    The obvious solution is to redevelop them into apartments. But that’s difficult and costs a fortune.

    The deep floor plates mean that for an apartment to have any light, it must be extremely narrow. Prospective residents won’t like that.

    What’s more, landlords have to add new internal walls and huge amounts of plumbing. This is enormously costly.

    Given the costs and difficulties of conversion, only a couple percent of Manhattan office space could be converted to apartments, according to an estimate from Moody’s Analytics.

    So what happens to these buildings?

    Many probably sit vacant until demand returns, years from now. Others may be demolished.

    And maybe in the mean time, dance troupes can use all those empty conference rooms for practice.

    What would you do with these empty office buildings? Leave a comment and let us know!

    Have a great weekend everybody!

    If you enjoyed this post, subscribe for more like this!

    More on markets:

    Will CRE Cause a New Regional Banking Crisis?

    ‘There’s a Lot of Agony Out There’: Munger on CRE

    Short Sellers Lose $120 Billion in 2023

    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. 

  • Negotiate Like an FBI Hostage Negotiator

    Jack Welch was one of the most famous CEO’s of his time. So how do you buttonhole him at a book signing and get him to speak at a class he’s never even heard of?

    “Is it a ridiculous idea for you to speak at the negotiation class I teach at USC?” Chris Voss asked.

    Chris wasn’t offering a dime. And he’d never even met Jack before.

    But sure enough, Jack turned up that fall and spoke to Chris’ students!

    Chris Voss is the former FBI lead hostage negotiator. In his superb book Never Split the Difference: Negotiating as if Your Life Depended on It, Chris helps us apply those negotiating lessons to our business and personal relationships.  

    I had the pleasure of seeing Chris speak this morning at an event in New York. Here are some of my favorite insights from today…

    Getting to No

    Getting to Yes was an international best seller. But it’s the wrong approach, according to Chris.

    When someone tries to get me to agree to something, I get nervous. Where is this leading, and what’s it going to cost?

    We’re uncomfortable saying yes. And if you’re making someone uncomfortable from the outset, good luck building a relationship.

    “No one tries to get you to say yes if they’re not taking you someplace.”

    Chris Voss

    Instead, try to get the person you’re negotiating with to say no.

    Chris wanted Jack Welch to say no to his question. That kept Jack comfortable and in control.

    Comfortable enough to do exactly what Chris wanted!

    I’ve already used this on one person so far today. 🙂

    Connecting with Sales Prospects

    Chris was on the phone with a man whose son had been kidnapped in Haiti. He had just a few minutes to show this distraught father that he was in good hands.

    So he explained that Haitian kidnappers were not killing victims. Instead, they were releasing them in just a few days.

    And sure enough, a couple days later, the boy walked free.

    The minute you meet someone, they decide if you’re worth dealing with. How do you show them both competence and empathy with their situation?

    By showing that you know what they’re up against!

    Let’s say I’m talking to a founder I just met. Why should she deal with an angel she doesn’t know?

    I can build a relationship between us if I can show I understand her struggles.

    I might say something like this:

    “Many startups are having a harder time selling as corporate budgets contract. Meanwhile, if you’re not doing generative AI, the fundraising market is a mess.”

    Even if I’m wrong about the founder’s challenges, she can correct me. At that point, she’s on my side helping me, and we’ve begun to build a relationship.

    Wrap-Up

    None of this stuff is a trick. Instead, Chris offers ways to empathize, build relationships, and work together with others.

    “As long as you sincerely try to show people that you heard them, they will forgive you for mistakes and will always be willing to deal with you again.”

    Chris Voss

    I strongly encourage you to read Chris’s book. I plan to reread it again soon!

    What do you struggle with in negotiation? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    More on business:

    The Trait of the Greats

    How I Pick Companies and More at the Single Family Office Summit

    The End of the Line

    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. 

  • Masa Pivots to AI

    Just when we thought AI couldn’t get any hotter, it got hotter. Yesterday, Masayoshi Son announced plans to take the industry by storm.

    From a report out overnight in CNBC:

    SoftBank Group chairman and CEO Masayoshi Son on Wednesday said that the Japanese investment firm plans to shift from “defense mode” to “offense mode” and wants to capitalize on the AI boom.

    “Now, the time has come to shift to offense mode,” Son said during a shareholders’ annual general meeting.


    Softbank has more money than just about anyone.

    Despite some high profile losses, its second Vision Fund still tips the scales at $30 billion.

    And Masa is about to fill up his piggybank.

    Softbank owns 100% of Arm, a British chipmaker. Arm has filed for an IPO which will put billions in Masa’s coffers.

    That money will be heading straight into AI startups.

    Already, the market for early stage AI companies is dangerously overheated.

    Just last week, Mistral AI raised over a hundred million dollars at a $260 million valuation. It has no product or customers.

    In fact, the company is just four weeks old.

    Once Masa dumps a few tens of billions onto the market, the Mistral AI round may look quaint.

    Masa has made some incredible investments, like Alibaba. But Softbank also has a history of giving too much money to startups at excessive valuations.

    Perhaps the most famous is WeWork. Softbank invested over $10 billion at valuations as high as $47 billion.

    Today, WeWork is worth just $163 million.

    I expect Softbank to repeat its mistakes with its AI investments. Look for huge checks going into fledgling companies at eyewatering valuations.

    I already find the AI market difficult to invest in.

    Many companies have amazing tools but few if any paying customers. And that amazing product is quickly upstaged by an even better one weeks later.

    Add in sky high valuations, and it’s a great way to lose your money.

    As Masa trains his firehose of cash on the market, these dynamics will only intensify.

    I will continue to invest in great AI companies at reasonable valuations, as I always have. And I’m also taking a special look at non-AI companies with great businesses that provide real value to customers.

    If no one else wants them, I’m happy to back up the truck.

    What do you think of Masa’s pivot to AI? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    More on tech:

    Heading Off the AI Cliff

    The Perfect Pitch

    How I Pick Companies and More at the Single Family Office Summit

    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. 

  • Short Sellers Lose $120 Billion in 2023

    A major rally this year has punished short sellers, leading to massive losses.

    From a report out overnight in The Wall Street Journal:

    Short sellers have incurred roughly $120 billion in mark-to-market losses this year, including $72 billion in the first half of June, according to S3. 

    “There are still many investors and hedge funds who think that this rally is ready for a pullback,” said Ihor Dusaniwsky, managing director of predictive analytics at S3. “Or at least that several of the highflying stocks will lose steam and revert back to the mean.”


    The AI-driven rally in big tech stocks is responsible for most of these losses. Jumps in heavily shorted meme stocks have meant even greater pain for the hedge funds and institutions betting against markets.

    Increasing interest rates also mean that holding short positions is more costly.

    To short a stock, a trader must borrow the shares and sell them.

    The trader pays an interest rate for borrowing the shares. Those short interest rates rise along with the federal funds rate.

    I hate short selling as a strategy.

    Best case scenario, you make 100% on your money. Worst case, your potential for loss is unlimited.

    S&P 500 Historical Chart


    Moreover, you’re swimming against the general rising tide of markets. And that short position is costing you in interest.

    Every day, humans are innovating. Together, they form companies and create incredible new products.

    And here in the United States, they do it in the world’s best legal and cultural environment for business. Betting against them is foolish.

    If we zoom in on the market and look at some of the most successful companies, the picture becomes even clearer.

    Let’s take Nvidia. Nvidia began as a small supplier to videogame console makers, going public in 1999.

    Since then, its stock is up more than 900-fold. A return like that always beats a short sale.

    Prophets of doom will always be with us. But I’m betting my money on a bright future.

    What do you think 2023 holds for markets? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    More on markets:

    Carl Icahn Losing $900 Million a Day

    Heading Off the AI Cliff

    Will CRE Cause a New Regional Banking Crisis?

    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. 

  • The Perfect Pitch

    Dan Siroker raised $12 million at a $350 million valuation for his startup, Rewind AI. The company is just 3 years old. Let’s dig into the pitch he used to do it.

    Rewind AI records everything that happens on your computer. You can ask Rewind questions like “What did I do last week? or “When did I last speak to Jim?”

    Dan’s pitch is the best I’ve ever seen. Here’s why:

    • Huge problem + specifics. Dan frames a massive problem: memory.

    Everyone could use some help remembering things. Almost any human is a potential customer, especially knowledge workers.

    But Dan doesn’t just frame a big problem. He’s very specific about how he solves it, and provides proof that it’s working as a business.

    • Personal connection to the problem.

    I often ask founders, “What made you want to start this business?” I’m gauging how committed they are to the problem, and why.

    Dan clearly explains why he cares about this problem.

    He struggled with losing his hearing in his 20’s, but hearing aids changed his life. He wants to do the same for people struggling with memory.

    • Great demo.

    Many slide decks could describe a dozen companies.

    “We’re helping teams connect.” I couldn’t tell you how many times I’ve seen that.

    Great, but how?

    By contrast, Dan takes us into his product and shows us exactly how it works. We can see its power and clean design.

    Any investor would be impressed!

    • Clear market size.

    Dan doesn’t give us some BS number like “cloud software is a $200 billion market.” That’s meaningless for any particular product.

    He tells us exactly what he charges and shows us how many potential customers exist. Multiply those together, and you have the market size.

    I found his numbers convincing. He’d only need 2.8 million Pro users to reach $1 billion a year in revenue.

    With tens of millions of knowledge workers in the US alone, this seems achievable.

    Market sizing is critical to investors. If you aren’t addressing a big market, you’ll never be a multibillion dollar company.

    • Solid financials. Dan gives us all the key info: revenue growth, customer acquisition cost, and burn.

    We can see he’s very efficient with money. We can also see that this business has great margins.

    • Great team. His team is packed with experienced builders, and Dan is a 2nd time founder.

    No wonder they can ship 11 releases a day!

    • It’s short.

    Dan covers everything investors need to know, all in less than 8 minutes. A lot of founders can’t do that in 30!

    I looked at 33 companies today. I can’t spend hours on each one.

    If you present the key info clearly and concisely, your odds of getting funded skyrocket.

    I hope this video helps you improve your pitch. Abstract advice is one thing, but seeing real success is quite another!

    What do you think of Dan’s pitch? Leave a comment and let us know!

    If you enjoyed this post, subscribe for more like this!

    More on tech:

    How I Pick Companies and More at the Single Family Office Summit

    VC Funding Down 48% in May

    The Trait of the Greats

    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. 

  • How I Pick Companies and More at the Single Family Office Summit

    How do angel investors pick investments? What’s the best way to invest in crypto?

    We dug into this and more at the Single Family Office Summit in New York last month. Here are some of my favorite moments:

    8:11: How I pick investments

    17:08: Clinton Buie of AmateMint Group on how to invest in crypto

    22:53: Barriers to real estate tokenization

    28:42: My thoughts on tokenization of assets

    Being on this panel was an incredible experience for me.

    Single family offices usually manage wealth in excess of $250 million. When I was growing up, my family was on welfare and used foodstamps.

    I never thought people like that would be paying to listen to me.

    This really is a great country! 🇺🇸

    What did you find interesting from the panel, and what did we get wrong? Leave a comment and let us know!

    I’ll be off tomorrow. Have a great weekend and see you on Monday!

    If you enjoyed this post, subscribe for more like this!

    More on tech:

    VC Funding Down 48% in May

    The Trait of the Greats

    Vision Pro for SaaS

    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. 

  • VC Funding Down 48% in May

    If you’re having a hard time raising money, you’re not alone. Venture funding fell by half in May compared to the prior year.

    From a report by S&P Global Market Intelligence:

    Venture capital investments worldwide dropped 47.8% year over year in May to $18.85 billion from $36.08 billion, according to S&P Global Market Intelligence data.

    The number of funding rounds slumped 38.9% to 1,129, from 1,847 a year earlier.

    One bright spot: funding actually jumped a little from the April doldrums:

    May totals increased slightly from the previous month, when $16.52 billion was raised across 1,057 venture capital-involved funding rounds.

    Here’s what I’m seeing in the market…

    Companies without AI at the core are struggling to raise. Especially at Series A, valuations for non-AI companies are extremely low.

    For founders, this can be dispiriting.

    But as an investor, I view this as a great opportunity. I’m doubling down on some of my most successful companies at rock bottom prices!

    Even for AI startups, fundraising can be difficult.

    Huge slugs of capital are going into a couple of companies like OpenAI and Anthropic. For everyone else, pickings are slim.

    A lot of investors are sitting on their hands. I see only about half as many deals as I did at the peak market.

    Many minority investors are waiting for a big name like Sequoia to come in. Only the strongest of signals gets them to open their wallet.

    I don’t operate that way. I make my own decisions, and the reputation of the other investors is a very minor factor.

    But even I have slowed down my investment pace so far this year. Fewer deals to choose from means fewer deals that I like.

    Soon, I think some great startups will emerge at the AI application layer. I’m excited about companies that apply AI to an industry to make 10x better software.

    Imagine AI tools for buying and selling derivatives, for example. You could describe the risk you’re seeking to hedge and AI could show you the perfect derivative to buy at the best possible price.

    Startups like this will have more defensibility than another chatbot or copywriting app.

    I expect to see this new generation of AI-enabled SaaS companies later in the year. When that happens, I hope to ramp up my investment pace.

    If you’re struggling to raise, my advice is to extend runway and get to breakeven ASAP. It’s hard, but it’s the only way to survive.

    What are you seeing in the fundraising market? Leave a comment and let us know!

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