TechCrunch featured an opinion piece on food startups by Matt Mireles last week with the core of the argument built around comparing the PE Ratio of a technology stock to Chipotle. You can check out the comments for rebuttal of the analysis, but I wanted to discuss PE Ratios – what it means, how to use it, and does it matter.
Some notes about the GoPro S-1 filed earlier today.
In general, this is a great look at one of the first lean hardware companies (which also includes companies like Fitbit, Makerbot, and 3D Robotics) This is an amazing time for experimentation in technology as the cost of starting has dropped so significantly in the past 5 years.
On Tuesday, the True team spent the afternoon at the World’s Largest Office Hours, part of the National Venture Capital Association’s VentureScape annual conference. The goal of these office hours was to bring hundreds of venture capitalists and entrepreneurs together in one room for an afternoon of networking, mentoring and idea exchange. As a member of the NVCA and supporters of innovation and entrepreneurship in general, we were extremely happy to participate.
Our team had a series of six meetings with Founders of companies who were seeking our feedback and advice on their business and pitch. As we worked through each session, we began to see a pattern emerging. Specifically, within the first minute of sitting down, the Founder would launch directly into describing the product or show a demo of the product.
In each case, we would slow the Founder down and ask a series of questions designed to provide background and context to the broader story.
Over the past four years at True, I’ve met with over a thousand Founders starting a new business. Of those, we eventually invested in 11.
Across that subset, none used a slide presentation in our initial conversation. Two had notebooks where they sketched out observations. One had a working demo. But for the rest, we just talked.
In elementary school, I was part of a group that would take a 5+ hour bus trip to participate in a sleepover at Museum of Science and Industry in Tampa, Florida. It was one of my favorite parts of every year – an opportunity to learn new things, meet interesting people, and generally nerd out. (They also had a wind machine which would imitate hurricane force winds – awesome)
Flying home from ORD Camp this weekend, I’m struck at how Zach and Fitz have re-created the same environment – a safe space where its cool to be curious and excited about new things – a chance to spend time with existing friends who you don’t get to see enough of, make new friends from nearby and far away, help out in conversations you can provide expertise, and learn about things you may have never even knew existed. (And with late night games – it effectively ends up being a 36 hour sleepover.)
Even in -13 degree weather, ORD Camp made my trip to Chicago awesome. Thanks Zach and Fitz!
Written for Eric Jackson’s Predictions Post for Forbes, some themes to watch in 2014:
The Rise of Citizen Science
Humans have long participated in scientific research, but Moore’s Law and Open Source Communities have given individuals inexpensive access to powerful research tools for the first time. Similar to other industries, when the cost of experimentation approaches zero, you spur individual creativity and open up whole new areas of opportunity. Early success stories include Foldit, Galaxy Zoo, Phylo, and Zooniverse but companies like OpenROV and 3D Robotics or projects like HiveBio in Seattle show what could be possible in the short-term.
Commercial Open Source Grows Up
Open Source Software has come a far way from its roots with Richard Stallman and the Free Software Movement in 1983. Individuals have long understood the technical merits and starting with the Open Sourcing of Netscape’s Browser in 1998, corporations have been opening up to the strategic and business value of Open Source too. Over the past decade, we’ve watched more and more individuals build sustainable businesses around open source projects – early examples include Automattic, SugarCRM, Cloudera, Mulesoft, and Puppet Labs – and next year we’ll start to see more of them maturing into large independent enterprises.
Human DNA as Code
This is the opportunity created by a software-first approach to solving problems in human biology and patient care driven by the explosion of available medical data (through EMRs) and molecular data (through the rapidly declining costs of full genome sequencing and other tests.) The market is lipe for rethinking as data finally comes online in a readable and maluable format. Companies to watch include Moleculo, Counsyl, Ginger.io, and Practice Fusion.
In 1960, JCR Licklider released his seminal piece on intelligence amplification entitled “Human Computer Symbiosis” which outlined his vision for the future of computing – a world not where computers replaced humans – but rather a world where “men will set the goals, formulate the hypotheses, and determine the criteria” while “machines will do the routinize-able work that must be done to prepare the way for insights.”
The core thesis behind his paper was the idea of technology abstraction – or the belief that as we come to more fully understand a concept – we can create rules-based infrastructure around it, use computers to automate the process, and then spend more time focusing on high-level problem solving.
Today, we’ve seen this technology already begin to reshape different industries – early examples include PayPal – whose fraud detection system is driven by machines searching for abnormalities in the data, which are surfaced, to human analysts for interpretation or Palantir who uses similar technology for catching criminals.
Today, there’s a similarly unique opportunity with human health data to ride the wave of declining cost curves in compute and medical testing and the resulting explosion in health and personal data to build next generation of smart software for the category.
One of the most discussed technology sectors over the past few months has been drones – or more specifically autonomous flying vehicles designed for non-military purposes.
While the technology is not new, the rapid decline in costs driven mainly by cellphones and open source software is driving the creation of products for the enterprise and even the every day consumer.
Spending some tracking the market over the past few months, here’s how I think about framing the opportunity:
Have been spending the last week catching up on this year’s BBC1 Essential Mixes.
Here are my 5 favorite from this year:
Took off from events in 2013, but back and currently planning to participate in these races in 2014: