Tremendous

An angel investor's take on life and business

  • Big Problems at Divvy Homes

    Divvy Homes was supposed to help people achieve the American Dream. But some are only finding a nightmare.

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    In a major investigation published this morning, Fast Company details widespread problems at the hot proptech startup.

    Divvy Homes buys the house you want and rents it to you. When you’re ready, you can buy the house from Divvy.

    This means Divvy is a huge landlord. And it’s struggling to service all those tenants.

    Amber Gutierrez of San Antonio moved into the house of her dreams with Divvy’s help. But when problems surfaced, Divvy was nowhere to be found:

    Gutierrez first reported a maintenance issue to Divvy in late January. The temperature in the home was hovering in the 50s, and her children were having trouble sleeping. She asked Divvy—legally, her landlord—to send someone to take a look at the heating system. But more than two weeks later, following an HVAC technician’s perfunctory visit, her children were still shivering through the night.

    Soon, more problems appeared:

    When the front porch and back deck started cracking and shifting, suggesting a foundation problem, she felt even more certain that they would have to leave, despite the prospect of having to pay a $4,400 surrender fee…

    Any massive landlord is going to have times when maintenance falls short. This is especially true for a startup scaling at warp speed.

    Divvy should incentivize its people to give customers great service. Customers should review their home and maintenance staff just like I review Uber drivers.

    Good reviews should be a must for raises and promotions. And any employee with a pattern of bad reviews should be fired.

    On the bright side, Gutierrez was able to find out about the foundation problems before buying the house. Had she bought it right away, those problems would’ve been hers to fix.

    Divvy’s business model is messy. It involves a massive amount of logistics that a platform like Uber or a SaaS company like Salesforce simply doesn’t have.

    Divvy also has huge reputational risks.

    It rents to poorer households. This means Divvy can easily be painted as a slumlord when maintenance falls short.

    Despite these issues, I think Divvy’s business model is a winner. Lots of people want to move into their dream home before they can afford it.

    Divvy can buy it for them and rent it to them until they’re ready to buy. There’s a huge market for this, and the transaction size is massive.

    But Divvy has to nail down its logistics. It must also make sure employees have the right incentives.

    If your customers aren’t happy, nothing else matters.

    Do you think Divvy helps aspiring homeowners, or hurts them? And why?

    Leave a comment at the bottom and let me know!

    More on tech:

    Russian Engineers Are Fleeing the Country

    How I Source Deals

    Bridge Rounds: Yea or Nay?

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    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: Divvy co-founder Adena Hefets

  • Russian Engineers Are Fleeing the Country

    Russia’s best tech talent is fleeing the country. Pushed out by a draft for the war in Ukraine, nearly a quarter of the nation’s best developers have left, according to a report in The New Scientist:

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    Hundreds of Russia’s top software developers appear to have left the country during its military invasion of Ukraine. The exodus of tech talent started even before Russian president Vladimir Putin announced a partial military mobilisation in September, spurring an estimated 200,000 men to flee amid the prospect of being drafted to join the war effort, and it could spell trouble for Russia’s future.

    Almost 23 per cent of Russian developers who made the most contributions to coding projects on the software development platform GitHub changed their location information or deleted their profiles between February 2021 and June 2022. That figure is nearly four times as high as that of developers from neighbouring countries who aren’t directly involved in the conflict.

    These engineers are the key to dominating the industries of tomorrow. Without them, Russia will struggle to compete.

    “Their permanent departure from the Russian labour pool or from the Russian economy can have detrimental effects,” says Samuel Bendett at the Center for New American Security, a national security think tank in Washington DC. “There aren’t that many IT workers in Russia to begin with.”

    Tech workers who remain in Russia face an uncertain future, as they might be drafted to replenish the Russian military’s ranks.

    This research agrees with what I’m seeing every day in the technology industry.

    Just last night, a young VC from Russia told me most of his friends have already left the country. One abandoned a job and two apartments to start over from scratch abroad.

    They don’t want to be killed or have to kill someone else. And with Putin rounding up young men to fight, even a visit home is out of the question.

    These highly skilled workers have more options than anyone else. So it’s no surprise that they’re the first ones off a sinking ship.

    The biggest beneficiaries so far seem to be nearby countries. Georgia, Armenia, and Turkey have attracted large numbers of talented young Russians since the invasion of Ukraine.

    The United States should stop at nothing to attract these talented young men.

    We have nowhere near the number of engineers our massive technology industry needs. Anyone who’s tried to recruit developers knows how hard it is.

    These young Russians are top technical talent there for the taking. And the US can offer pay far beyond any company in Turkey or Georgia.

    Attracting Russia’s best and brightest is also the ultimate PR coup. Look Mr. Putin, your most talented young people are leaving you and coming to us!

    The White House is welcoming Russian asylum seekers. We should double down on this strategy, with a particular emphasis on finding top engineers.

    There will be nothing sweeter than using Putin’s own people to beat him.

    What do you think of Russia’s brain drain? Leave a comment at the bottom and let me know!

    Have a great weekend everyone!

    More on tech:

    The Autonomous Weapons of the Future…and Present

    How I Source Deals

    Bridge Rounds: Yea or Nay?

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    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: “Russia trip, Apr 2008 – 57” by Ed Yourdon is licensed under CC BY-NC-SA 2.0.

  • How I Source Deals

    Every morning, I sit down at this computer and try to find the next Google. But where is it?

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    When it comes to startups, I cast a very wide net. In a typical month, I look at about 200 companies.

    I choose one.

    Here are some of the places where I like to fish:

    1) Syndicates. I’m a member of almost 100 of these investment groups, which lets me see a ton of deals.

    Syndicate leads have usually been investing a lot longer than I. Their networks are extensive.

    You can plug into those networks, for a price. You pay 20% of any gains to the syndicate lead.

    Especially for newer angels, syndicates are a must. They give you a network on day 1 that would take years to build.

    Some angels don’t want to pay the fees syndicates charge. This is foolish unless you already have an amazing network.

    80% of something is a lot better than 100% of nothing!

    Look for syndicate leads who have been investing at least 5 years with at least 1 unicorn. They have the best networks.

    The best syndicate I know of is Jason Calacanis’, here.

    2) Venture firms. I have relationships with a number of venture capital firms from attending events and doing deals together.

    I send them deals I’m investing in, and they reciprocate. I’ve found some awesome deals this way.

    3) Seedscout. Seedscout is an awesome new platform where founders can request intros to investors.

    Founders have to pay to use the platform, which eliminates a lot of unserious people. This leaves some really first rate startups.

    And unlike a syndicate, there’s no 20% carry to pay.

    4) Cold inbound. Unfortunately, I get way too many messages to reply to them all.

    I know, I’m sorry!

    These entrepreneurs need help. And you never know which one of them might be the next Sergey Brin.

    I was able to keep up with these messages at first. But as my network grew over time, so did the time commitment.

    I found myself spending hours responding to messages and taking meetings with little to show for it. So I gave myself permission to not respond unless the founder has a warm intro.

    But from time to time, I’ll dip into the pool of cold messages when I see something that interests me. You never know which one might be a gem!

    For angels and VC’s, looking at a huge number of deals is critical. The best deal out of 10 versus the best deal out of 200 will look very different.

    Cast that net wide and you just might come up with a whale of your own!

    Investors: how do you source deals? Founders: how do you find investors?

    Leave a comment at the bottom and let me know!

    More on tech:

    ‘I Heard 100 No’s a Day’: How Travis Kalanick Built Uber

    Bridge Rounds: Yea or Nay?

    The Startup Green Lights

    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: “Needle In A Haystack” by t_buchtele is licensed under CC BY-NC-ND 2.0.

  • Bridge Rounds: Yea or Nay?

    Now that I’ve been angel investing for 18 months, some startups are coming back and asking for more. Should I double down, or stand pat?

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    Zachary Ginsburg of Calm Ventures wrote a great blog post on the subject. He was kind enough to let me excerpt it here.

    Zach deals with the toughest re-investment calls of all: bridge rounds. These rounds happen between big, full-fledged rounds like Seed and Series A.

    They can be a great opportunity – or a way to throw good money after bad. Below, Zach explains how to tell the difference.

    Enjoy!

    I saw another GP post about bridge rounds and thought I’d chime in with some quick commentary as I’ve thought about this quite a bit.

    There are generally 3 types of bridge rounds I see.

    • Bucket #1 Company’s performing well but not well enough to justify a larger priced round and/or at their target valuation. In this current market where multiples have compressed 50-80%, this is happening more frequently.
    • Bucket #2 Company underperformed for some semi-legitimate reason (supply chain issue, capacity issue, product bug, R&D required more time than expected, revenue lagging traction, etc.), but you build conviction that this is a temporary hitch with the original investment thesis more or less intact, though likely with some added runway risk or other risk.
    • Bucket #3 Company’s underperforming, and the round is one last ditch effort to make something happen i.e., a bridge to death.
    • I’m also adding a #4 & #5 bucket which occur though less often: #4, the company’s raising to provide sufficient runway to get them through an acquisition, and #5, the company is making a soft or hard pivot, but the investors still have conviction in the company leadership. Sometimes this occurs as a bridge, sometimes I see it as a recap.  

    I’ve seen buckets #1, #2 and #3 dozens of times. #1 and #3 are generally (but definitely not always…) easy to spot – #2 is trickier.

    My view is that if I can get in a bridge round that falls into the 1st bucket – the company’s performing well, but requires additional runway to hit the benchmarks required to raise a larger, priced round at a sufficient markup – I typically take it. It’s one of the few times for LPs to get significant value in a high performing company in venture, and these rounds have been some of our best performing deals. Without disclosing names, here are a few that come to mind:

    • Series A bridge for a B2B SaaS co at a ~$35M pre-money valuation that subsequently raised multiple large, priced rounds, the last taking place at an $800M+ valuation from a tier 1 venture fund. At the time, it was pretty clear this company fell into the first bucket.
    • Series A bridge for a consumer tech company at a $95M pre-money valuation; raised multiple subsequent priced rounds, the most recent one valuing the company at over $1B from a tier1 lead. The company pretty clearly fell into the first bucket.
    • Series A bridge for a consumer tech company at a $20m valuation cap; less than 12 months later, they raised at a $140M valuation from a tier1 lead. It was not clear if this company would succeed and definitely fell into the #2 bucket. In this case, COVID was the reason for underperformance, and while there was significantly more risk, we felt that if they could manage through it, they could quickly raise at a substantial (3-5x+ markup), which they did.
    • Seed bridge for an autonomous tech company at a $20M pre-money valuation. Acquired 1 year later for $250M. The Company was performing well; my general instincts at the time was that this was a bucket #1 deal.

    Why would a high performing company offer investors value in a bridge? One common reason is because the company is just looking for a small amount of capital and to close quickly so that it can continue to execute. They’re less concerned with the small dilution hit, and thinking bigger picture, and will very likely more than make up for it in the next round when they actually raise a significant amount of capital.

    These are just my very high level thoughts to give you a sense of how I view the bridge landscape. All bridges are not bad and as mentioned, many have been amazing performers for us. On the other side, I’ve invested in bridges that I thought fell into bucket #2, but ended up being #3 (one comes to mind, and it was extremely disappointing). It’s a judgement call; when you’re right, the upside can be substantial and if you’re wrong you can lose your own capital and LP capital fast. From an LP perspective – I’d judge the deal on its merits (is this a good deal or a bridge to death; are the reasons for the bridge versus a priced round legitimate), and I’d make sure the round provides sufficient runway (min 12 months runway; 18-24+ better) to avoid a quick death. 

    I love the way Zach breaks down every possible scenario. I agree 100% that if you can invest in a company that’s growing fast at a similar price to what you paid a year ago, that’s an amazing bet.

    Do you invest in bridge rounds? Why or why not?

    Leave a comment at the bottom and let me know! See you tomorrow!

    More on tech:

    The Startup Green Lights

    ‘I Heard 100 No’s a Day’: How Travis Kalanick Built Uber

    Why I Just Invested in ProsperStack

    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: “bridge” by barnyz is licensed under CC BY-NC-ND 2.0.

  • Latest Report: AMC Fails to Deliver Hit Over 2 Million

    Fails to deliver in shares of AMC Entertainment Holdings have hit over 2 million shares, according to a new SEC report released this week.

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    Failed trades peaked at 2,161,808 shares on September 28th. Fails to deliver remained elevated through the end of September, the last day covered in the report.

    AMC’s new preferred shares, trading under the symbol APE, also saw large numbers of failed trades. They peaked on the same day, at 466,507 shares.

    I find it suspicious that fails to deliver in both shares would peak at the exact same time. My hunch is that hedge funds launch coordinated attacks on both share classes at once.

    One powerful weapon in their arsenal is naked short selling. This involves selling short shares you never borrowed.

    Naked shorting is a powerful way to push down a stock’s price. If you never have to find shares to borrow or pay interest, you can short as many as you want!

    Naked short sales often leave a trail of failed trades. You can’t settle a trade when the shares never existed.

    Naked short selling is illegal in most circumstances. But why let that trouble you?

    Another key piece of evidence is how out of line AMC’s fails to deliver are compared to much larger stocks. Here’s a snapshot from September 28th:

    Alphabet (Google): 92

    Amazon: 21,012

    Apple: 11,083

    Microsoft: 60,869

    AMC: 2,161,808

    APE: 466,507

    These tech giants are hundreds of times the size of AMC. So why does AMC have dramatically more trades failing to clear?

    Perhaps the tech giants are too big for hedge funds to attack.

    Our markets rely on the confidence of investors. But it’s hard to maintain that confidence when stocks see huge numbers of failed trades and no one investigates.

    What do you think of the chaotic market in AMC shares? Leave a comment at the bottom and let me know!

    More on markets:

    New Report: Millions of Fails to Deliver in AMC and APE Shares

    Tiger Global Down 52% — Losses Over $18 Billion

    Hedge Fund Manager’s Arrest Shows How Market Manipulation Works

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    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. 

  • The Startup Green Lights

    When I meet with a startup founder, certain cues jump out. They shout, “This one’s a winner!”

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    Today, I thought I’d run down a few of the things that impress me most:

    1) You’re open with information.

    The best founders have nothing to hide. Be open with investors about customers, revenue, etc.

    The strongest founders are excited to share their progress! Adopt that attitude, whatever stage your company is at.

    2) You’re humble. The best founders give all the credit to their team.

    The only thing they take credit for is the mistakes!

    This is a key trait of good leaders. Always put your team in the spotlight and yourself behind the scenes.

    3) You’re close to your customers. Great CEOs talk about their customers constantly.

    They know everything about them. They go to the same conferences and read the same magazines.

    Because they know so much about them, they can give them exactly what they want!

    4) You have strong product velocity. I recently invested in a company that pivoted from SaaS to a marketplace model in just a few months.

    Already, the marketplace is doing $2 million a year in revenue. A year ago, this product didn’t even exist!

    This is incredible product velocity. When I see that, I’m sure you can adapt to a changing business environment and succeed no matter what.

    5) You’re growing fast.

    Every startup is born tiny. In order for it to ever matter, it has to grow, fast.

    If you’re growing revenue 20% month over month or more at seed stage, you’ve got my attention! You must be doing something right.

    6) Your burn is under control.

    I advocate growing at warp speed. But you have to make sure you don’t go broke in the process.

    Keep you burn multiple at 3 or less for a seed stage company. This makes sure your growth is cash efficient.

    7) You’re realistic about valuation.

    Toto, we’re not in 2021 anymore.

    Last year, some startups were worth 100 times ARR or more. That was then, this is now.

    Today, a high growth seed stage company is worth about $8 million pre-money. These companies usually have $5,000 to $25,000 a month in revenue.

    When a founder has realistic expectations, I know she’s focused on the right thing: building the company for the long term.

    If you work hard for your customers and cooperate with investors, you’ll get noticed. And you just might get a very large check.

    What gets you most excited about a startup? Leave a comment at the bottom and let me know!

    The next blog will be on Tuesday – I have an acting gig. Have a great weekend, everyone! 👋

    More on tech:

    The Startup Red Flags

    The Burn Multiple: What Is It, and What Can It Do for You?

    The Startup Metrics That Make Investors Drool

    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. 

  • ‘I Heard 100 No’s a Day’: How Travis Kalanick Built Uber

    “I heard 100 no’s a day for 6 years straight.”

    Travis Kalanick, Founder, Uber Technologies

    Travis Kalanick knew something was wrong.

    The number of taxi licenses in New York City had not increased since the 1940’s. During that time, the city added over 1 million residents.

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    So he picked up the phone and started dialing. One by one, he cold called black car drivers, trying to get them to join his new service.

    Most hung up. But a few were intrigued and met the young entrepreneur.

    They became the first Uber drivers.

    Travis recounts the fascinating early days of Uber on stage with Jason Calacanis at the LAUNCH Festival in 2014. This vintage interview is a master class in how to create a startup out of nothing and make it grow.

    At first, there was just one driver on the map in each city. Then, as Travis kept pounding the phones, there was another, and another.

    By 2014, Uber had reached a $17 billion valuation. That same year, it did more rides than taxis for the first time in its home market of San Francisco.

    Travis was a born entrepreneur.

    He started an SAT prep company in high school. Later, he founded two tech startups.

    The first folded, and the second, Red Swoosh, sold for a small sum. Like many great entrepreneurs, Travis’s biggest success was ahead of him.

    Five years after founding Uber, the startup was still growing at 20% month over month with millions in revenue.

    A growth rate like this is exceptional even in early stage companies. For a company Uber’s size, it’s truly astounding.

    Like PayPal, YouTube, Google and eBay, Uber grew at warp speed from the beginning. That’s why growth is one of the main things I look for in investments.

    I also love seeing founders who are close to their customers. And you can’t get closer than Travis.

    He drove an Uber himself on a busy Saturday night!

    One passenger saw potential in him and left this review:

    “Somebody needs to tell the CEO of the company that this driver should do more than just drive. He could really add value to Uber.”

    Anonymous Uber Passenger

    I guess talent is hard to conceal, no matter how hard you try!

    In time, Uber hopes to become a super app for way more than rides. The app currently offers food delivery, groceries and even alcohol.

    If there’s any real contender for an American super app, Uber is it.

    For all his success, Travis remains excited about going to work:

    “You’ve gotta enjoy what you’re doing and what you’re building. You’ve gotta be passionate about creating something.

    So for me, it’s not about an IPO, I don’t even think about it.

    …what are all the crazy, effed up, awesome problems I can solve? And what is all the crazy, awesome s*** that I can invent?”

    Travis Kalanick

    Let’s go find some awesome problems to solve!

    What lessons do you take from Travis’s career? Leave a comment at the bottom and let me know!

    More on tech:

    The Founders: The Story of PayPal

    You’re Doing Investor Meetings Wrong

    Q3 Venture Funding Slows to a Crawl

    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: “Travis Kalanick” by jdlasica is licensed under CC BY 2.0.

  • Tiger Global Down 52% — Losses Over $18 Billion

    Note: This is not financial advice.

    Hedge fund giant Tiger Global Management has lost the majority of its capital in 2022. From a new Bloomberg report:

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    Tiger Global Management and Whale Rock Capital Management were among stock-picking hedge funds to report September losses as equity markets tumbled.  

    Chase Coleman’s Tiger Global fell 4.4% for the month, extending its decline for the year to 52%, according to people familiar with the matter who asked not to be identified discussing the results. The New York based firm’s long-only fund tumbled 9.6% in September to bring its year-to-date slide to 66.5%.

    Tiger managed about $35 billion at the beginning of the year, putting its losses at over $18 billion.

    Those losses could be far larger when Tiger’s startup investments are taken into account. Those bets on opaque private companies are hard to value.

    What we do know is that tech startup valuations are down. This is especially true for the late stage companies Tiger favors, which closely track the public markets.

    With losses like this, a brutal math sets in.

    Tiger must more than double its capital just to get back where it was at the beginning of the year. Worse yet, it’s long-only fund has to triple!

    That’s incredibly hard to do.

    But until Tiger wins back its losses, it won’t be able to charge performance fees. These juicy 20% fees are the lifeblood of hedge funds.

    Without those fees, bonuses will be slim to nonexistent.

    The top performers will leave for greener pastures. Those that stay are likely to be demoralized.

    I suspect Tiger will close the long-only fund, and perhaps the entire business. After all, starting fresh is an opportunity to earn juicy fees again.

    Tiger’s abysmal performance trails many index funds with much lower fees.

    I own Vanguard 500 Index Fund Admiral Shares, which are down just 23% this year. They have an expense ratio of 0.04% and no performance fee.

    Tiger’s investors would do well to ditch the expensive and poorly performing fund and give Vanguard a call.

    Do you think Tiger will survive? Leave a comment at the bottom and let me know!

    More on markets:

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

    New Report: Millions of Fails to Deliver in AMC and APE Shares

    Q3 Venture Funding Slows to a Crawl

    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: Tiger Global CEO Chase Coleman

  • Why I Just Invested in ProsperStack

    You work hard to get new customers. So why let them slip away?

    ProsperStack lets you provide custom offers when a customer tries to cancel. They can even segment your customers and give the best offers to your top customers.

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    You can also A/B test different offers to see what works best. And you can do all this in a beautiful, no-code interface!

    Only the largest companies, like Netflix, have special programs to stop churn. But why shouldn’t your company have it, even if you’re not a giant?

    ProsperStack can also help you understand why customers leave. They can tell you “you lost $10,000 in monthly recurring revenue because you don’t have a Salesforce integration.”

    That gives your company amazing direction. It’s time to put that Salesforce integration at the top of the list!

    But the thing I like most about ProsperStack is that you can easily see how much revenue ProsperStack stopped from churning. This makes their value proposition crystal clear.

    I’m delighted to be an investor in ProsperStack’s recent seed round! Book yourself a demo and crush your churn today!

    What issues do you see with subscription churn? Leave a comment at the bottom and let me know!

    There will be no blog on Monday. I have an acting gig!

    See you on Tuesday. Have a great weekend, everyone! 👋

    More on tech:

    Q3 Venture Funding Slows to a Crawl

    The Startup Red Flags

    You’re Doing Investor Meetings Wrong

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  • Q3 Venture Funding Slows to a Crawl

    Venture funding in the third quarter slowed to a crawl, according to a new report out this morning from Pitchbook:

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    Estimated deal count in Q3 (4,074) is off by almost 20% from the quarterly record high recorded in Q1 (5,049) and is the lowest count seen in any quarter since Q4 2020 (3,364). Q3 saw $43.0 billion invested in VC deals across all stages, a nine-quarter low, cementing a tone of investor hesitancy and increased focus on business fundamentals amid the global economic downturn, even if the numbers remain high on a historical basis.

    Exits were just $14B in the entire quarter. This is in line with figures from 8 years ago.

    Meanwhile, venture funds continued to raise huge sums:

    US-based VC funds have raised $150.9 billion, surpassing last year’s previous record and taking the 21-month fundraising total above $298.1 billion.

    As an angel investor, I found July and August particularly slow. That’s usually vacation season anyhow, but this year the market was even colder than usual.

    At the end of August, I spoke with the head of one of the most active VC’s in the US. He predicted a busy fall.

    I was skeptical.

    But sure enough, I started to see activity pick up in September. Those deals will probably take until at least Q4 to close, so they’re not reflected in Pitchbook’s numbers.

    Personally, I made four investments in Q3, right around my usual pace. A down market is no time to back off — if anything, we want to be making it rain to take advantage of lower valuations!

    But nonetheless, a lot of investors got spooked. I saw some great deals I was in only raise half as much as expected as investors pulled back.

    Especially at seed stage, the market we’ll exit in will be totally different from today’s. So we should always be investing in great companies.

    Warren Buffett said it best in his 1986 letter to shareholders:

    What we do know, however, is that occasional outbreaks of those two super-contagious diseases, fear and greed, will forever occur in the investment community. The timing of these epidemics will be unpredictable. And the market aberrations produced by them will be equally unpredictable, both as to duration and degree. Therefore, we never try to anticipate the arrival or departure of either disease. Our goal is more modest: we simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.

    Where do you think the venture market is headed? Leave a comment at the bottom and let me know!

    More on tech:

    The Startup Red Flags

    You’re Doing Investor Meetings Wrong

    Shopify’s Tobi Lutke on Layoffs and Building for the Long Term

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    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: “dead slow sign” by satguru is licensed under CC BY 2.0.