Monthly Archives: June 2015

Apple Watch

I just purchased an Apple Watch. I haven’t worn a watch in 4 years as I rely on my smartphone to tell the time.

The reason I bought the Watch is the same as the reason why I bought the iPad several years ago. Although I don’t believe that I’ll have many personal use cases for it, it’s a new tech platform. I want to stay up to date on the evolution of new tech platforms as, if they take off, this will help me better identify and evaluate startups that build businesses on top of these platforms.

I was right about my use of the iPad. I rarely use it (maybe once a week for reading) as it’s too large to fit in my pocket and, if I’m carrying a bag around, I prefer the comfort of a larger screen laptop equipped with better business software. However, the iPad has emerged to become a popular device that many people rely on for their entertainment (video, magazines, and games). I regularly install the iPad version of a startup’s app to evaluate its user experience on the tablet device.

Let’s see what use cases I have for the Watch and how those compare to mainstream use cases.

Great teams

The Golden State Warriors won the NBA championship this week, defeating the Cleveland Cavaliers 4 games to 2. Since the games tend to take place between midnight and 6AM Turkish time, I wasn’t able to catch them live. However, I watched several of the reruns on Turkish TV the evening after the game.

Two facts stood out to me during the series.

The first was the amazing performance of LeBron James of the Cavs. Here were his stats during the Finals: 35.8 points, 13.3 rebounds, and 8.8 assists per game. Anyone familiar with basketball will appreciate how amazing those numbers are. After Game 5 when the Warriors went up 3 games to 2, LeBron answered a reporter’s question by stating that he’s the best player in the world. He is.

However, LeBron’s individual performance was overshadowed by the Warriors’ collective performance. This is demonstrated by the stats of the Finals MVP Andre Iguodala. Andre became MVP by averaging 16.3 points, 5.8 rebounds, and 4.0 assists per game during the Finals. If those are the statistics of the best performing player on your team, you won’t be able to win a championship unless each of your players makes a similar contribution. With nine different Warriors scoring in double digits at least once during the series, that was the case for the Warriors. It was a team effort.

The best outcome is produced by having individually great players play a great team game. Barcelona’s performance in soccer is the best example of this I know. They have individual stars like Messi, Neymar, Iniesta, and Dani Alves, but are also a great team. However, if you don’t have the luxury of both and need to choose between great individuals and a great team, I’ll pick the latter.

Congratulations to the great Warriors team and their fans across the world.

US tech funding

Andreessen Horowitz published a presentation on the state of US tech funding earlier this week. The presentation looks to answer the question of whether the US tech sector is in a bubble or not. While many investors increasingly think so, the team at Andreessen Horowitz doesn’t. The full presentation is below.


There are two key takeaways from the presentation.

The first is that the high valuations of late stage private tech companies are the result of many companies delaying their IPO’s. If these companies had chosen to go public, late stage valuations wouldn’t be so high. While I agree with this assessment, I think that it ignores a very important point.

The fact that many late stage companies are delaying their IPO’s has made traditionally public market investors start to compete for investments in late stage private companies. The result is more dollars chasing late stage companies and this has pushed valuations higher than what could be explained just by companies delaying their IPO’s.

The second key takeaway is that the decrease in the cost of starting a company has led to an increase in the number of seed stage companies getting funded. I fully agree with this assessment. There’s more debate about whether the average seed round size has increased or decreased. The presentation argues the latter whereas my anecdotal evidence suggests the former. The difference here likely results from what we treat as seed stage companies.

Video conference calls for online fundraising

I was reading about a startup on AngelList this morning. The deal is being syndicated by Paige Craig of Arena Ventures, a seed and growth stage venture firm. The deal details included the recording of a video conference call where the startup’s founder described his business and responded to questions from syndicate members. The video call had taken place live the prior night and was made available asynchronously to other syndicate members.

I think that this is a great idea for both founders and syndicate members.

From the perspective of founders, it allows them to differentiate themselves from other founders raising on online platforms. Raising money by telling your story and having a two-way interaction with investors is more effective than a one-way communication channel where you feed investors with PowerPoint presentations and text.

It’s as close as you can get to a face-to-face chat in real life, while being much more scaleable as it allows the founder to talk to multiple investors at once. The scalability of this communication medium is very important as it wouldn’t be practical for the founder to speak with over 50 individual investors each contributing a few thousand dollars, as is often the case on online fundraising platforms.

From the perspective of the syndicate members, it allows them to see what the founder is like as a person. What’s their body language like, and does their motivation come across? These are very important predictors of how well the founder will be able to recruit and sell, and they’re much easier to evaluate through video than through written communication.

The video call is also a platform that helps syndicate members learn from the founder’s answers to the questions of other syndicate members. Another investor may be approaching the startup from a very different perspective and their view may help enlighten your own.

I don’t know if Paige is the first to try out a video conference call on an online fundraising platform, but it’s the first time that I came across the approach. I think it’s very effective. Great work Paige.

Decision making

I read In an Uncertain World by former US Secretary of Treasury Robert Rubin during my first year of college. As its title suggests, its key insight was that we live in an uncertain world. This uncertainty is the result of the complexity of the world and the fact that we’re armed with limited information. The book described how Robert approached the tough decisions that he had to make during his career in the private and public sectors.

The book was the most insightful biography I’d read at the time and continues to be among the best I’ve read to this day. Having just left from the comfort of my parents’ home in Belgium to the US, I had come across the book at the right time. Life had become a lot more complex without my parents around, and the book helped me get comfortable with making and sticking to decisions in the face of this complexity.

So how do you make decisions under uncertainty? Unfortunately, there isn’t a one size fits all answer. Depending on the circumstances surrounding the decision, like what field it’s in, when the decision needs to be made, and who it impacts, a different approach will be called for. However, I use two tricks to improve the quality of my decisions.

The first is to focus my decision making on a specific field. You can’t be a great decision maker in all fields because you don’t have enough time to learn a lot about each field. So your choice is to either be an average decision maker in many fields or to be a great decision maker in one or two fields while minimizing the number of important decisions you take in other fields. You can achieve the latter by lowering the number of decisions you need to make in other fields and getting help from others for those decisions that do need to be made.

The second is to make decisions with a potential impact and corresponding risk (these are usually correlated) that I’m comfortable with based on my decision making capabilities in the chosen field at a given time. This means taking smaller risks and accepting smaller rewards when starting out, and graduating to make decisions involving higher stakes as you see the results of your first decisions. By analyzing where you went right and wrong in the past, you’ll be able to apply these learnings to improve your decision making capabilities in the future. Once you’re comfortable with your ability to make decisions of a certain magnitude, it’s time to up the game.

While these two tricks will improve the quality of your decisions, you don’t always have the luxury of waiting until you feel prepared to make a decision. Sometimes life will force you to make a decision that you don’t feel ready for. In these cases I’ve found that it’s best to go with your gut feeling. Your gut feeling is largely a reflection of your values so pursuing it will make sure that you continue to live in line with those values. If you do pursue your gut feeling and don’t like the outcome, you might want to rethink your values.


AngelPad is a seed accelerator program in the US. It doesn’t get as much media attention as Y Combinator, Techstars, or 500 Startups, but the 2015 Seed Accelerator Rankings Project recently ranked it as the top accelerator in the US. Granted, Y Combinator now classifies itself as a seed fund rather than a seed accelerator which is why it isn’t featured on the list. However even if it were being second best after Y Combinator is a big success.

AngelPad’s biggest success so far is mobile advertising startup MoPub which was acquired by Twitter for $350M. We’ve also looked at multiple AngelPad companies and invested in two: Arthena and ValetAnywhere.

We consistently find that the founders come with the right experience for the specific startup they’re working on. For example, Madelaine, the founder of art co-investment platform Arthena, has an educational and work background in art, and Rob and Lawrence, the founders of on-demand valet app ValetAnywhere built and exited a mobile startup in the past.

The founders are also very well prepared for investor presentations. They’ve thought about the different questions which are likely to come from investors and address these head on in their presentations or succinctly in your conversations with them. This is likely the result of AngelPad working with only 12 to 14 startups per semi-annual batch. This allows AngelPad’s husband and wife founders Thomas Korte and Carine Magescas, and their teammates and mentors, to spend a lot of time with each startup.

Ahish Krishna, the founder of Mammoth, a company in AngelPad’s current batch, recently wrote about what it’s like to participate in AngelPad. It’s a great resource for founders thinking about applying to the accelerator and investors looking to understand the AngelPad process.

We actually looked into Mammoth a few months ago and were very impressed with Ashish and his co-founder Karan Gupta. The only reason we didn’t invest is because we’re not sufficiently familiar with the publishing space so we wouldn’t be the right investors for them.

We’re happy investors in Arthena and ValetAnywhere, and look forward to the opportunity to work with more of AngelPad’s great startups in the future.

Sign of the times

We recently looked into a company in the US. The company’s Series A round was heavily oversubscribed and unfortunately we weren’t able to participate.

The company saw such great demand from investors that, less than a week after the equity round was completed, it decided to raise an additional convertible loan to accommodate this demand. The only problem is that the cap on the convertible is 3 times the original pre-money valuation of the equity round, and over 2 times the post-money valuation. There has been no change in the company’s fundamentals to justify such an uptick in less than a week. We therefore decided not to participate.

I don’t blame the founders for their strategy. They’re doing what’s right for the company and if I was in their shoes I would do the same. Although I don’t know how much they’ll be able to raise given the terms of the convertible loan, they’re simply responding to supply and demand.

There’s a lot of capital in the market, some of which is price sensitive and some of which isn’t. The price insensitive participants are likely those which are investing for the first time and therefore haven’t learned the painful lesson that price matters. Their actions are governed by a fear of missing out, and that’s exactly what they did in this company’s equity round. In order to not miss out on the next big thing, they just might accept the new terms.

It’s just another sign of the overheated times.

The entrepreneur’s decision

I came across the following tweet from Josh Hannah yesterday. Josh is a partner at VC firm Matrix Partners.

Josh says it very well. All too often, I see entrepreneurs giving too much weight to an investor’s recommendations. In Josh’s case, he says that the entrepreneur is in the business 10X what he is. That’s probably because he’s invested in 10 companies. We have over 50 investments so in our case, our entrepreneurs are in the business 50X what we are.

We’re likely to have seen a similar situation as the one you’re facing play out at another company in the past, and can give you guidance on what factors to take into account in your decision based on those experiences. In other words, we can provide you with a framework to assist your decision making. We’ll also share our thoughts on what we believe is the best course of action based on that framework.

However, you know the specific circumstances of your company much better than we do. Sometimes those specific circumstances will dictate the same course of action we recommend, and sometimes they’ll call for a different approach. As the entrepreneur, it’s your decision.

Meal Box and Munchery

I read the post which Shervin Pishevar of Sherpa Ventures published about their investment in on-demand meal company Munchery yesterday. I don’t know Munchery’s detailed metrics but if the company’s $125M in capital raised and PR buzz are a sign, it must be performing very well.

After reading the post, I thought about how our investment Meal Box, an on-demand meal company in Turkey, operates relative to Munchery. Specifically, I was looking to see if there are any learnings we can apply from Munchery to Meal Box.

The key differences I identified between Munchery and Meal Box, and the resulting opportunities, are below:

1. Cold vs ready-to-eat meals: Munchery delivers its meals cold to customers who then need to heat it in a microwave or oven. Meal Box delivers its meals warm and ready-to-eat to customers. We know from customer feedback that customers in Turkey don’t want cold meals. This sends a negative signal about the quality of the food. Microwaves are also less prevalent in Turkey than in the US and it takes a longer time to heat your meal in an oven. As a result, Meal Box’s approach is correct on this front.

2. Delivery trucks vs franchises: Munchery places its meals directly from its kitchen onto delivery trucks that get them to customers. In contrast, Meal Box delivers the meals to franchisee locations who then send them to the end customer. By avoiding physical real estate, Munchery is able to keep its costs low. However, it needs to plan very carefully for demand in order to avoid the waste that occurs if a meal is placed on a delivery truck but there isn’t enough demand, or more demand comes in than what a delivery truck serving a specific area has available. Meal Box considered Munchery’s approach when it was first launching. However, since real estate costs are much lower in Turkey than in the US markets where Munchery operates (especially for the off main street locations where Meal Box’s delivery only franchises are found), it’s more economical for Meal Box to operate through franchisee locations. There isn’t an opportunity for Meal Box here.

3. Pre-orders: Munchery allows its customers to place pre-orders. This helps them predict demand, manage supply accordingly, optimize delivery schedules, and reduce waste. Meal Box also offers this feature on its checkout page but doesn’t actively promote it to customers. There is an opportunity for Meal Box to do more here.

4. Centralized vs decentralized delivery personnel: Munchery performs its own deliveries. In contrast, each Meal Box franchisee is responsible for its own delivery personnel. There is an opportunity for Meal Box to centralize the hiring, training, and allocation of delivery personnel among its franchisees in the future.

Modanisa’s TV ads

Modanisa opened its first offline store two weeks ago. The company is following up this launch with a strong TV advertising campaign which began yesterday. You can see Modanisa’s first TV ad below.


I really liked the ad. The actresses are all dressed in Modanisa products which strike a great balance between being fashionable and remaining conservative. The audio overlay clearly conveys Modanisa’s key value proposition which is to offer conservative women a wide range of clothing that they find difficult to find elsewhere. The audio jingle towards the end of the advertisement is catchy, and the end of the ad clearly communicates’s online-first approach.

It’s an exciting time for the company and we’re very fortunate to be involved.