Monthly Archives: April 2015


Navdy is a heads-up display for your car which projects information from your smartphone onto your car’s windshield. So rather than having to look down at your smartphone for navigation, to check emails, text, and other use cases, you can look directly in front of you. This is a lot safer.

Beyond the functional advantages, Navdy also makes you feel cool while using it. You can interact with the device through voice and gestures. The projection of the information onto your windshield is also really neat. This is the same technology that pilots use and installing Navdy is a lot easier than learning to fly an airplane.

Check out the video below to see some of Navdy’s features in action. Navdy’s founder Doug Simpson also makes a guest appearance towards the end of the video.

We invested in Navdy’s first round of funding last August and the company’s $6M in pre-orders since then have given it the momentum to raise a new $20M round to increase production capacity and speed. We were fortunate to be able to retain our pro-rata in the new round of funding which like the first was led by Upfront Ventures.

I can’t wait for Navdy to ship in the second half of this year.

Moore’s Law

The tweet below shows the difference between what the main character in the game Wolfenstein looked like in 1992 and what he looked like in 2014.

I still remember playing Wolfenstein in the mid 1990’s. It was a simple but addictive shooting game.

I gave up playing video games towards the end of college so I didn’t know that Wolfenstein’s current character looked like this. However, I could have easily guessed.

Technically, Moore’s Law states that the number of transistors per square inch on integrated circuits doubles every year. In practice, this manifests itself in the capability of digital electronic devices growing at an exponential rate. The falling price of computer processing power, the rise in storage capacity, and improvements in graphics quality are all linked.

So the same law which is responsible for smartphones having as much processing power now as mainframes had in the 1990’s is responsible for the improvement in the quality of graphics in the Wolfenstein game.

This makes me want to be a kid again.

Bitaksi metrics

Bitaksi’s founder Nazim Salur was at the Webrazzi Mobile conference this past week. You can view his presentation below and Webrazzi’s summary of his interview here.

Bitaksi is our most popular investment because everyone uses taxis. Since Bitaksi touches the daily lives of so many people, I’m often asked about how Bitaksi is performing. Unfortunately I’m unable to share detailed metrics without the founder’s approval.

However, Nazim shared some metrics during the conference. Now that these numbers are public, I’m also including them here.

– 1,150,000 app downloads

– 11,000 registered taxi drivers

– 200,000 monthly rides

– 10-15% monthly growth rate

– 25% of payments are made by credit card

Distribution channels

I recently ran into the founder of a startup in the advertising technology space who I first met in June 2013. The company will go unnamed as it’s raising a round right now and I want to respect their privacy. We looked into the company in June 2013 and, although we really liked the team, we decided not to invest because of the product’s reliance on third party platforms for its distribution. At the time, the company was active in Turkey and looking to expand into two new markets.

During our recent chance meeting with the founder, he updated me on the company’s progress which I then further researched on the web. They’re now in 12 countries and based on public information, count nearly every major Turkish company and at least 10 global blue chip companies as their clients. The company is doing very well for itself.

It was clear that the company would be able to execute on its growth and geographic expansion plans when we first met. The founders are simply smart and have a lot of hustle. As a result, seeing the progress that the company made in the 20 months since we first met gave me a short feeling of regret for not having invested when they were just starting out.

However, upon deeper reflection, I realized that our original reason for not investing remains intact. The company is still reliant on third party platforms for its distribution, and these platforms could cut off access to the company’s product at any time.

For example, Twitter recently limited live streaming app Meerkat’s ability to import a user’s Twitter followers and who they follow onto the Meerkat app. This took place immediately after Twitter purchased Meerkat competitor Periscope. Twitter hasn’t limited Meerkat’s ability to automatically broadcast its users’ live streams on Twitter yet but this remains a future risk.

A heavy reliance on third party platforms for distribution doesn’t prevent startups from getting funded. Some investors are comfortable taking this risk. For example, although Twitter’s decision likely had an adverse impact on Meerkat’s valuation, Greylock still invested $12M in the company after the decision.

However, our preference is to invest in companies that either control their own distribution or have multiple evenly balanced distribution channels which lower their reliance on any single channel.


Our startup Zet is a marketplace connecting consumers with hand-crafted design products. Similar to Etsy in the US, Zet helps mom and pop stores build their online presence and aggregates their products and storefronts on the Zet marketplace to drive them traffic.

You can see on Zet’s website that it features truly unique products. From accessories to clothing to home furnishings, you won’t be able to find the products available on Zet on other e-commerce sites.

With a unique mix of items produced by a unique group of store owners, Zet has developed a very loyal customer base. Zet’s offering appeals to a smaller segment of customers than that of large e-commerce sites which sell mass-produced items. However, whereas customer retention is a big challenge for most large e-commerce sites whose mass production forces them to compete on price, Zet’s focus on delivering a unique selection of products keeps customers coming back to the platform.

We observe the same power user trend on the supply side. When a designer takes their craft seriously, identifies which products sell the most, and produces greater numbers of these pieces, it can build a sustainable business fully off of Zet. And when power designers do their job well, customers come.

Zet’s role is therefore to help identify and encourage these power designers. Offline meet-ups can be a particularly effective way to achieve this by giving the designers an opportunity to showcase themselves while helping buyers discover the people behind the products they love. This fosters a sense of community that strengthens the link between existing buyers and sellers, and this community spirit makes the platform more attractive for others to join.

Zet is organizing such an offline meet-up this weekend. For those of you that live in Istanbul, the Zorlu Center will be hosting some of Zet’s most prominent designers from tomorrow until this Sunday. If you’ve already shopped on Zet, it’s a great opportunity to interact with the people who made your products in a personal setting. If you have yet to shop on the platform, you can discover some of the best products that Zet has to offer.


In addition to an internet investor, Hasan is also an internet entrepreneur. TazeDirekt is one of his entrepreneurial ventures.

TazeDirekt is an online grocery business whose current focus is to deliver fresh, organic, and regional products of the highest quality that you can’t find at other grocery stores. The company’s long term goal is to become the FreshDirect of Turkey.

TazeDirekt’s focus on offering customers high quality fresh products is at the center of their recent TV ads. You can see the ads featuring fruits and vegetables, eggs, milk, and red meat below. I haven’t tried their milk but can certainly vouch for the quality of their fruits and vegetables, eggs, and red meat.

Istanbul – San Francisco

Turkish Airlines’ first direct flight from Istanbul to San Francisco took place yesterday. Previously the only way to fly between the two cities was through a layover airport.

This direct flight reduces the time to get between Istanbul and the world’s leading tech ecosystem from between 15 and 25 hours depending on your layover to 13 hours. It also saves travelers a sleepy walk through a random intermediary airport.

Beyond making it easier for existing passengers to travel between Istanbul and San Francisco, hopefully this direct flight will encourage new passengers to embark on the route. And this will further the transfer of knowledge and relationships across the two cities.

Update: After I wrote this post, I came across this funny video by Turkish Airlines to promote the new flight.


When startup equity co-investment platform AngelList first launched, its goal was to make investing in startups accessible to everyone.

Whereas VC funds managing large pools of capital invested in great startups in the past, AngelList wanted to make the same startups accessible to investors able to commit as little as a few thousands dollars. By pooling the investments of many such small investors, AngelList became a viable alternative for startups to raise rounds up to $3M. Larger rounds still remain the territory of venture capital so far but this may change in the future if small investors see strong returns from their AngelList investments. This will give them the ability to start writing larger checks while also attracting more small investors onto the platform. Very successful companies like Uber, Postmates, Shyp, AltSchool, and DuckDuckGo were all once on AngelList, so this is likely to be the case.

The fact that these companies were all available on AngelList shows that the traditional VC assertion that AngelList suffers from a self-selection bias where the best companies still go to VC’s that can add value to the startup, and the remaining poor ones are left for AngelList isn’t correct. There’s simply too much uncertainty around a company’s chance of success at an early stage, and so much more of a startup’s value is created by its team than its investors, for this to be the case. AngelList has the very real possibility of further disrupting the VC industry and this is why VC’s can be defensive.

Whether AngelList will be very successful in the long run is no longer an interesting question for me. I have little doubt that its influence will continue to grow. The more interesting question is whether AngelList can stick to its original goal of making investing in startups accessible to everyone as its influence grows. The initial results suggest that it won’t be able to.

As AngelList has been able to pool greater amounts of capital for startups, it has attracted the interest of angel investors with a very strong track record who want to increase their firepower when making an investment. This includes Naval Ravikant (AngelList’s founder), Elad Gil, Kevin Rose, Gil Penchina, and Jason Calacanis. Rather than invest $100K of their personal money, these angels use AngelList to invest $100K of their own money and $400K from a syndicate of backers. Just like Limited Partners pay 20% carry (share of profits) to the General Partner of a VC fund, the backers of these syndicates pay a carry between 5% and 20% to the syndicate lead as well as a fixed 5% carry to AngelList. This is a total carry between 10% and 25%.

So AngelList is no longer making investing in startups accessible to everyone, but rather everyone who is willing to pay a carry between 10% and 25%.

More recently, AngelList introduced a pre-funding feature. Rather than reviewing startups and deciding to invest through an opt-in mechanism, investors are now able to pre-fund syndicates. This means that you have money in your AngelList account and when a new deal is shared by a syndicate lead, you’re already opted in by default. You still have 5 days to review the deal to decide if you want to participate or drop out, but the default is that you’re participating. Pre-funding gives syndicate leads greater visibility into their ability to raise money for a startup. Syndicate leads reward their pre-funded backers by sharing the startups they’re investing in with them before sharing them with their regular backers. As a result, sometimes regular backers never get a look at the startup whose round is already filled with the contributions of pre-funded backers.

So AngelList is no longer making investing in startups accessible to everyone, but rather everyone who is willing to pay a carry between 10% and 25% while also pre-funding syndicate leads.

This sounds a lot like how VC funds work. The only differences are that investors in VC funds don’t have 5 days to opt out of an investment (opt-in is not the default status but a requirement), and VC funds raise capital on a fund basis, rather than a deal-by-deal basis.

Although there will be short-term reversals, I believe that the supply of capital for tech startups will continue to outstrip demand for this capital in the future. First, technology and mobility are becoming a more and more important part of our daily lives and this trend shows no sign of going away. And second, although a tough job, being a supplier of capital for tech startups is easier than being an entrepreneur. As long as both of these facts still hold, AngelList will grow increasingly influential in the future. This will give it the ability to continue to further segment investors on its platform.

I wouldn’t be surprised if syndicate leads first remove an investor’s ability to opt out of investing in specific startups, and then start raising an aggregate amount of capital to invest in a number of startups during a fixed period of time (a fund) rather than on a deal-by-deal basis.

In other words, AngelList may become the very system it was looking to displace.

However, this departure from AngelList’s original goal isn’t the company’s fault. Like any startup, it’s simply shifting its product to meet the realities of a changing market. Markets are a reflection of supply and demand, and AngelList is sitting right in the middle of a great one.

A great taxi ride

I recently had the best taxi ride of my life.

I opened the Bitaksi app and called a taxi to my home. Cengiz Atakul, a driver, responded within 10 seconds. As Cengiz was able to see my location on the map, he directly came to pick me up within 2 minutes of my request. We didn’t need to communicate on the phone.

Up until now, this is a great experience but nothing extraordinary.

As I entered the taxi, I was amazed by how clean it was and its pleasant smell. This is not the case for every taxi in Istanbul.

After entering, Cengiz asked how I was doing and this led to a deep conversation. There was a lot of traffic on the road so we had quite a bit of time to talk despite the short distance I was traveling. We talked about his experiences using Bitaksi, including the time when he took a family to their son’s girlfriend’s family’s home to ask for her hand in marriage. This is a common ritual in Turkey. Since the home was outside the city, the family was worried that they wouldn’t be able to find a taxi for the ride back. So they didn’t let Cengiz leave and he attended the ceremony together with the family.

Another highlight which Cengiz described was when, before beginning a ride, a student passenger shared that he didn’t have any cash. The student requested that his parents transfer the money to Cengiz’s account later. Cengiz kindly accepted the ride and sure enough the money arrived at his bank account a few days later.

Finally, I talked about how surprised I was that passengers rarely tip taxi drivers in Turkey. While it’s common to tip at restaurants, this practice hasn’t yet made it to taxis.

I was enjoying the conversation so much that I didn’t want the ride to end. However, end it did. The fare come to 21 TL and I added a 4 TL tip to Cengiz to show how happy I was with the amazing service he offered that day. I gave him a 5 star review, and although I didn’t do anything to deserve it he did the same for me (drivers also review passengers on Bitaksi).

Bitaksi gives drivers like Cengiz the opportunity to differentiate their high level of service from other taxi drivers in Turkey. It also gives passengers the opportunity to enjoy their ride.

Thanks Cengiz. At this rate, tipping taxi drivers may soon become the norm.

Seed round valuations

I recently came across the following post from Aaron Levie, the founder of enterprise cloud storage and content management company Box. Box recently went public and currently has a market cap north of $2 billion.

Basically, Aaron points out that he raised $80K for Box’s seed round at a $240K pre-money valuation. Doing further research on the web shows that Mark Cuban was Box’s first investor.

I’m not advocating that startups raise at a $240K pre-money as I think that this is a pretty significant undervaluation of any company targeting a big market that decides to take outside funding. However, at a time when seed valuations can be as high as double digit million dollars, Aaron’s post is an important reminder that founders should be optimizing for their startup’s chance of success, not their valuation.