Monthly Archives: November 2015

Same model, different geography

We recently invested in Poshmark, the leading second hand female clothing marketplace in the US. We’re also investors in Modacruz that applies the same model in Turkey.

In fact, this is the fourth time that we invested in the US equivalent of a company pursuing the same model in Turkey. Our investment in prepaid debit card Ininal was followed by an investment in, our investment in ride sharing startup Volt was followed by an investment in Lyft, and our investment in on-demand delivery network Kapgel was followed by an investment in Postmates.

There are two ways to look at these investments.

The first is that they represent a conflict of interest because both companies are pursuing the same model. We don’t believe that a conflict exists. This is because although the companies may be pursuing the same model in theory, there is close to no probability that these companies will be directly competing with each other in the future. Our Turkish investment is very unlikely to expand to the US, and our US investment is very unlikely to expand to Turkey anytime soon.

The second lens through which to look at these investments is as an opportunity to exchange best practices across companies. Since both companies are pursuing the same model, there’s a lot that they can learn from each other.

Depending on which company is further along in its growth, it’s likely that the exchange of best practices will take place from the more mature company to the earlier stage startup. This means that Volt will be inspired by the more mature Lyft, Ininal and will both learn from each other, Modacruz will be inspired by Poshmark, and Kapgel will be inspired by Postmates.

It’s this second lens through which we look at these investments. There’s a lot of knowledge that can be transferred from one company to the other.

Note: An earlier version of this post was updated to include our investments in Kapgel and Postmates.

Focusing on our existing companies

Hasan recently participated in an interview on Milliyet, one of Turkey’s leading newspapers. You can read the full piece in Turkish here.

Most of the interview is a rehash of his thoughts on the internet ecosystem in Turkey. Specifically, he shares that there are many startup ideas, a lack of capital, and too much focus on technological product innovations rather than technology-enabled business model innovations. Some of the solutions he offers to these problems include the emergence of more internet entrepreneurs with successful exits who invest their exit proceeds back into internet startups (our portfolio will hopefully contribute to this) and Turkey’s large companies investing in VC funds and creating their own corporate VC funds.

The most significant new piece of information shared in the interview is that we won’t be making many new investments. Although we remain very selectively open to new investments, we already have a very broad portfolio of 61 active investments, including 33 in Turkey. We will focus our funding and our limited bandwidth on our existing companies, including Hasan’s personal ventures TazeDirekt and Webnak, to make them successful.

Vivense’s Ankara showroom

Our furniture e-commerce business Vivense opened its first showroom in Istanbul earlier this year. It’s by the Cevahir shopping mall.

The first showroom was very successful in driving sales as it gave potential customers a place where they could see and feel specific pieces of furniture before buying. Although not all the models available on the Vivense website are on display, some of the most popular ones are. These give potential customers a good idea of the quality of the furniture which Vivense sells.

The showroom is also serviced by interior designers who give visitors guidance about which furniture to buy in light of the style they’re looking to express at their home or office.

Following the success of the Istanbul showroom, Vivense recently opened its showroom in Ankara. I haven’t had the chance to visit it yet, but if you live in Ankara, you can check it out at the bottom of the Platin Tower Business Center in Sogutozu.

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Sometimes you feel like the whole world is collapsing in on you. Everything seems to be going wrong, there’s simply too much to be done, and no way that it’s going to be done well.

I used to experience such feelings more frequently and for longer durations. Since I’ve learned that I’m somehow always able to make it out to the other side, I experience these moments less often and less intensely than before. But they still occur.

Sometimes what you need is to talk to someone you trust. Sometimes it’s to listen to a song at full blast. Sometimes it’s to yell at the top of your lungs. Sometimes it’s to exercise with absolutely no thought. Sometimes it’s to cry hopelessly. Whatever works for you, whatever it is you need in that moment, you’ve just got to do it.

Eventually the clouds fade away. You see that while some things aren’t working, others are. While you might not be able to do everything, you can do what’s important. And while it may not be done perfectly, it just might be good enough.

You realize that reality hasn’t changed. Your old feelings were simply fooling you. Or are your new feelings fooling you now? You don’t know. All you know is that believing in your old feelings means stopping. And believing in your new feelings means moving forward.

So you choose to believe in your new feelings. You choose to move forward. You go and do it. You keep chugging away.

And you hope. You hope that your conviction and hard work pay off.

Your fears always remain within striking distance of a few neurons. And even more scary, death remains an unpredictable split second away.

But you hold these feelings at bay. Not now. Not while my brain is still working and my body is still moving. Not while I’m still feeling.

DNA testing

I received an email from DNA testing and analysis company 23andMe yesterday. I had ordered their DNA testing kit last December, and received the results of the test in January of this year.

At the time, 23andMe was only able to show ancestral information based on the results of the tests. The Food and Drug Administration (FDA) prevented 23andMe from sharing health-related information like your susceptibility for a certain disease and ability to serve as a carrier of that disease based on variations in specific genes.

However, the FDA recently changed its stance to support 23andMe’s provision of health information to its customers. And this is why I received an email from 23andMe yesterday morning. Basically, the email shared that as a result of the change in the FDA’s stance I’m now able to see 60 health-related reports in my 23andMe dashboard.

The messaging is still very tentative. 23andMe states that it’s not a diagnostic tool, and it therefore refrains from giving you specific probabilities for your likelihood to develop certain diseases. Instead, it simply says whether you’re likely or unlikely to experience the condition.

The service is also opt-in. You choose which reports to view, and can therefore choose to not reveal information about specific conditions that you don’t want to know about.

I chose to see the results of each of the reports. Among other things, I learned that I’m likely to be lactose intolerant, unlikely to blush after drinking alcohol, and likely to have more fast twitch muscle fibers which make me a better sprinter than marathoner. I could have already guessed each of these traits from knowing myself, but it felt good to see my predictions confirmed through the test.

I was also fortunate to discover that I don’t carry any of the variant genes which 23andMe knows to be associated with a wide range of diseases like cystic fibrosis and sickle cell anemia. I may still carry other variants associated with these diseases that 23andMe hasn’t yet accounted for.

I’m glad the FDA took a tentative step to support 23andMe’s goal of informing people about their health. I recognize that the link between specific genes and conditions isn’t perfect, but I believe that the best way to establish more accurate associations is to analyze as much data as possible. And giving more health-related information to people is a great way to motivate them to take the test and contribute their data. This effect overcomes the downside of giving people potentially incorrect information, which can be mitigated with qualifying statements like “likely” and “unlikely”.

As the number of conditions reported in the test increases, and more people start to use the test, we’ll gain more confidence about the causal links between different genes, their combinations, and the expression of specific conditions. Eventually, we’ll be able to drop the “likely” ‘s and the “unlikely” ‘s.

Sharing information with operating investors

I was speaking with the founder of one of our startups recently. The company is performing well in an attractive market and is already well financed. However, additional funding would let us scale up our already profitable customer acquisition channels. This is why I was happy when an investor with experience in our space expressed interest in the company.

The caveat is that the investor also has an operating arm and their experience in the space gives them the ability to execute on the idea. If they’re approaching us with bad intent, they could be looking to learn about the details of our strategy and resulting metrics, and execute the strategy themselves if they find the metrics attractive enough. This was the concern raised by our founder.

I understand where our founder is coming from. He has been working very hard to build a business with tangible value over the last few years of his life. He doesn’t want to take the risk of someone sweeping in, building a competitor, and taking away his market leadership.

However, while I understand his perspective, I don’t agree with it. If you’ve been working on a business for several years and established it as a market leader, that means that you know what you’re doing. You’ve executed better than each of your competitors so far. If you think that this was simply because your competition was weak, you’re likely giving yourself too little credit.

And even if weak competition did contribute to your success, now you have a multi-year head start to any new competitor. Even if that new competitor does indeed execute better than you, as long as you keep doing what you’re doing they’re simply going to be playing catch up. Economies of scale are on your side so at your current scale, each incremental effort you put forth is going to generate a larger positive return than the same effort put forth by your competitor at their smaller scale.

For each of these reasons, I recommended our founder to share information with the investor. Even armed with the same information, the investor will not know the business as well as our founder. Truly knowing a business comes from having taken the daily actions that produced that information as output, not from reading about the information that others have produced. You need to truly know your business to become the market leader, and our founder has already shown this to be the case.

Fickle markets

I wrote about international VC funds piling into Indian tech startups in a post from May of this year. Sequoia Capital, Accel, SoftBank, and Tiger Global each raised funds between $305M and billions of dollars to invest in Indian startups.

Fast forward 6 months and at least one of these funds, Tiger Global, appears to be scaling back its appetite for Indian startups. I wouldn’t be surprised if other large funds follow suit. The excerpt below is from an article in The Economic Times of India.

“”I am going to be consolidating a considerable part of my Indian portfolio this year. I think I entered India two years early,” [Tiger Global partner] Fixel reportedly said to the founder of an ecommerce company that his firm has backed.”

So what has changed in 6 months? From the quote, it seems unlikely that there has been an important shift in the underlying fundamentals of individual companies. Rather, it seems like what has changed is the market’s attitude towards startups. US investors are increasingly focusing on building internet companies with healthy unit economics combined with growth, rather than those that grow at all costs. And the changing attitude of US investors is being felt in other countries.

Markets are very fickle. What’s in favor one year can be out of favor a few years, or in this case even months later. It may then be back in favor a few years after that. As a startup founder, you can’t control the market. You can simply take when it’s giving, and be ready to buckle down when it’s not.

Parental leave

Mark Zuckerberg recently announced on his Facebook profile that he’ll be taking 2 months of paternity leave when his soon to be born daughter arrives. This is less than the 4 months of parental leave that Facebook offers its US employees, but a long time for the founder and CEO of the world’s largest social network.

I had two reactions to the announcement. The first is that Mark is very likely to continue working during the 2 month leave. 2 months is simply too long a time for someone in his role to completely stop working. Important decisions will still need to be made at Facebook, and Mark will spend time thinking about and making these decisions while on leave. His parental leave is therefore better described as a shift in his default status from work to parenting than as a complete leave from work.

My second reaction is that if the founder and CEO of Facebook can take a 2 month parental leave, then so can most people. In many lines of work, companies offer shorter parental leave durations, or workers themselves choose to take shorter parental leaves. However, the work responsibilities of the vast majority of people are less than Mark’s responsibilities at Facebook. So the reason why others don’t take as long of a leave isn’t because things would fall apart if they did, but because they or their company mistakenly think that things would fall apart if they did.

Don’t take yourself too seriously. Your contributions to your work are very important. However, you can continue to perform any essential responsibilities while on leave, while having your less essential responsibilities partially performed by your colleagues and partially delayed until your return. On the other hand, your contributions to the first few months of your child’s life are irreplaceable.


Yesterday evening we had an early celebration of my wife’s birthday together with her parents. Her birthday is during the week and we decided to celebrate early during the weekend because her parents live out of town. It was a fun night.

And this morning, I woke up to this. Sometimes moments, and the pictures (or videos in this case) that capture them, speak a thousand words.


Paper notebooks

I recently read a New York Times article by David Sax about the increased use of the Moleskine journal, a paper notebook, in the tech community. Basically, the article points out that on one hand we’re increasingly using digital note-taking apps like Evernote and the Notes app which comes preinstalled on iPhones. However, interestingly, this isn’t coming at the expense of physical paper notebooks.

I don’t know whether digital note-taking apps or paper notebooks are growing faster. But I can certainly attest to using more paper notebooks despite also performing more digital note-taking in the last few years.

I use the iPhone Notes app because I like its simplicity. Evernote provides many features beyond those offered by the Notes app. For example, it lets you collaborate on specific notes and sync these notes for cross-device viewing. However, I tend to take notes for my personal use, and I always carry around my smartphone so I don’t need to access the notes on other devices. I prefer the simplicity of the Notes app to the additional Evernote features that I don’t use.

Those who work with me know that I also carry a paper notebook into each of my meetings. I do this because I find it easier to structure my thoughts by writing them down. And the reason I prefer to do so on paper than in digital form is once again because of the simplicity. When I’m taking notes in an app, my mind gravitates to the many other apps (browser, email, chat, …) that I could be using on the device. This distraction lowers the quality of my thoughts.

On the other hand, when I’m taking notes in a paper notebook, these distractions fade away. I’m able to focus exclusively on the content of what I’m writing. I prefer the simplicity of a paper notebook to a digital note-taking app in the proximity of other apps that I shouldn’t be using. The growth of the Moleskine journal suggests that a lot of other people feel the same way.