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Venture Trends Newsletter

Surviving in the Crisis: 25 top stories for Startups, Venture and Angel Investors

Venture Trends Newsletter, Issue #12

I read daily and this newsletter gathers together this week’s most interesting content I saw related to the venture capital and startup ecosystem. I hope you find it useful as well as being a time saver. So I’m curating for you. You can check out more about me at https://archimedes.studio

In this week’s free issue there are some amazing things to highlight.

  • Fred Destin on Leadership in a Time of Crisis
  • Startup Loans from the Government
  • Founders and Investors – Power Shifts
  • Making Cuts – How to…
  • Field Guide to Remote Working
  • Great Question – “Why might we Fail”?”
  • Improving your home for video calls – Bijan Sabet

I email the newsletter each weekend. There is little or no commentary included, it is the things I found compelling or interesting.

This is the free version, and I also have a supplemental paid version that includes access to content for full subscribers only. If you are not a full subscriber and you want to be then please open the weekly supplement and choose a monthly or annual plan.

This week’s paid version is here – Venture Trends for Paid Subscribers

Stories in the paid version this week:

  • Why Central Banks and Digital Cash could create Universal Basic Income
  • Product Engineering – Silicon Valley Style
  • 7 Leadership Lessons Men Could Learn from Women
  • How the 2008 Recession impacted Seed, Venture and Growth investors

Developing Leaders in a Time of Crisis

Fred Destin on Medium

Your staff members are working from home and you’re adapting to running your business in distributed mode. You need new leaders around you like never before. Here’s some thoughts on how you can enable that.

Most of your startup team members will fall into the camp of individual contributors, especially in young companies where you hired, typically, young people against specific tasks and goals.

Creating a network of leaders to help you scale your business is one of the most efficient way for you to build a strong and sustainable fabric and leverage your powers 100X over.

You can create the conditions under which this happens, and nurture your best talent into leadership. I’m not talking about only your VPs and leadership team, but about everyone in your company.

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Real Leaders Are Forged in Crisis

Harvard Business Review

Your job, as a leader today, is to provide both brutal honesty — a clear accounting of the challenges your locality, company, non-profit, or team faces — and credible hope that collectively you and your people have the resources needed to meet the threats you face each day: determination, solidarity, strength, shared purpose, humanity, kindness, and resilience.If you’re looking for in-the-moment role models, turn to Governor Andrew Cuomo of New York or Governor Gretchen Whitmer of Michigan, both whom are offering de facto masterclasses in crisis leadership: explaining the gravity of the situations their states are facing, outlining the resources being deployed to battle the coronavirus, and calling their constituents to act from their stronger, more compassionate selves.

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How 6 top VCs are adapting to the new uncertainty

Fundings & Exits – TechCrunch

To get a better handle on how venture capitalists are approaching today’s market, TechCrunch corresponded with a number of active investors to learn how their investment selection process might be changing in light of COVID-19 and its related disruptions .There’s likely some selection bias at work, but the venture capitalists who were willing to answer our questions were quick to note that they wrote a similar number of checks in Q1 2020 as in both Q4 2019 (the sequentially preceding quarter) and Q1 2019 (the year-ago quarter).

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What your startup or portfolio company can do to survive Covid-19

The Startup – Medium

You’ve probably already taken drastic steps to save cash and extend your runway: stop any non-essential operating expense, called investors for some more cash, discussed with your suppliers and other creditors, maybe had to resort to decrease the days and hours of your staff, and obviously asked your customers for their support.if you can afford it at all, continue marketing so as to gain some saliency: media is very cheap right now and most companies have stopped all advertising to save cash.

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Podcast: Crisis Coverage w/ Samir Kaji – Relief $ for Startups via CARES Act, EIDL, PPP; & How an Extended Downturn Affects Emerging VC Funds

The Full Ratchet: VC | Venture Capital | Angel Investors | Startup Investing | Fundraising | Crowdfunding | Pitch | Private Equity | Business Loans

Samir Kaji of First Republic joins Nick on a special Crisis Coverage installment to discuss Relief $ for Startups via CARES Act, EIDL, PPP; & How an Extended Downturn Affects Emerging VC Funds.Some of the best companies (Uber, AirBnB) first took institutional capital after the 2008 crisis; is now the time to be aggressively investing?

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Start-ups will now be eligible for coronavirus relief loans

WFMJ

“The problem stems from the SBA’s definition of “small business” in light of the way that many startups in America are financed – through equity investment provided by venture capital firms, which typically make investments in a portfolio of young businesses, understanding that many will fail while a few will survive and thrive. 

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The pendulum will swing away from founder-friendly venture raises

Fundings & Exits – TechCrunch

This morning brought fresh economic bad news for the U.S. economy, with over 700,000 jobs lost in the latest report , despite the window of time measured not including some of March’s worst days , and the data itself not counting as many individuals as it might have ; the unemployment rate still rose nearly a full point to 4.4% .The impacts of the national economic slowdown are going to change the face of venture capital as we’ve come to know it during the last ten years.

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Amid Downturn, Silicon Valley’s Balance of Power Shifts From Startups to VCs

The Information

For years, entrepreneurs have called the shots in Silicon Valley’s startup ecosystem as an abundance of capital chased a limited supply of good ideas.  But in a matter of weeks, as businesses everywhere lurch to a halt due to the coronavirus pandemic, the pendulum has swung decidedly back toward venture capitalists. 

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3 Tips to Avoid WFH Burnout

Harvard Business Review 

As millions of employees around the world have had to make a sudden and unprecedented shift to remote work amid the coronavirus pandemic, many might find themselves feeling like they need to work all the time to signal their devotion and productivity — and, as a result, may struggle to create healthy boundaries.The lines between work and non-work are blurring in new and unusual ways, and many employees who are working remotely for the first time are likely to struggle to preserve healthy boundaries between their professional and personal lives.

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If You Have to Cut — 5+ Thoughts On Where

SaaStr

At the end of the day, if you are going long, what matters most is that you close a customer for life.Building pipeline and doing discovery calls with prospects does matter now, even if sales cycles have just lengthened an unpredictable amount.

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How to do a layoff If you need to.

“When Others Are Fearful…”

VC by the Numbers – Medium

We focused on the two most recent major shocks, both of which my co-founder Trevor Kienzle and I lived through as VCs: the Dotcom Bubble Burst followed by the 9/11 Terrorist Attacks (which we’re considering for this purpose as a single shock because they were so close in time), and the 2008 Financial Crisis.Realized multiples for all VC investments, including investments in first institutional rounds, increased significantly immediately following both the 9/11 Terrorist Attacks and the 2008 Financial Crisis.

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Struggling to Thrive as a Large Team Working Remotely? This Exec Has the Field Guide You Need

First Round

I also had managed or worked with many distributed teams at places like CNN or The Wall Street Journal and there were a fair share of bumps in the road,” says Leung, who spent nearly 20 years in the news world before joining NerdWallet in late 2013.In that spirit of sharing and making sure others don’t have to start from scratch, Leung sat down with us to pass along tactical tips and key takeaways from leading a large remote team.

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NVCA 2020 Yearbook

US NVCA Annual Yearbook

Venture capital firms offer help for laid-off start-up employees

The Straits Times

Venture capital (VC) firms across South-east Asia have launched a community-led initiative to help start-up employees who were laid off due to the fallout from the coronavirus outbreak find new opportunities.In the same spirit, Ms Elise Tan, a consultant who works with start-ups, has built a spreadsheet that matches start-up companies to volunteer mentors.

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“What do you suspect the reason we will fail will be?”

When a VC Investment Fails, Does That Mean It Was a Bad Investment? Probably Not

SaaStr

Both in terms of how many start-ups in their portfolio are modelled to fail, and what % of the capital in that fund is modelled to go into losses.With venture capital investments that fail, is the problem most often with the entrepreneur or was it a bad investment by the VC?

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How to value a startup in a downturn

Fundings & Exits – TechCrunch

Pulling from our conversation, D’Onofrio told TechCrunch that startups want to be valued like companies were a few months ago, while investors want to pay today’s market prices.She’s the right person to chat with about the links between private valuations and public share prices as she not only helps put capital into growing startups, she also helps run the Bessemer cloud index (now a partnership with Nasdaq , and trackable on a day-to-day basis ).

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An Open Letter to Startup Founders Everywhere in a Time of Crisis

Hi, I’m David G. Cohen

I started my first business in 1993, right in the middle of the recession, because I didn’t know any better.Near the end of the recession in 2009, I invested in Uber, Twilio, and SendGrid.

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Improving the home setup for video calls

Bijan Sabet

Since I’m on a Zoom call most days, I’ve been taking steps to improve the video conferencing setup at our house.So it’s now on a desktop tripod, facing me during video calls.

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Can an Entrepreneur Back Out of a Signed Term Sheet Without Damaging Their Reputation?

SaaStr

Can an entrepreneur back out of a signed term sheet without damaging his/her reputation?And that fund that shouted at me, after they changed the terms on an unsigned term sheet?

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7 Signs an Angel Investor … May Really Be a “Devil” Investor

SaaStr

What matters is price, check size, and maybe, pro rata rights in the next round (if you have a significant amount of capital to invest later).Complex, multi-page term sheets for an angel investment are signs of problems to come.

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VCs or Founders: Who Makes More?

SaaStr

Their own investors (“LPs” or Limited Partners) pay them for a decade more than fairly to manage their investments, no matter how well or poorly they perform.But — truly great founders make the most by far.

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Startups Face Uncharted Waters As Funding Dries Up – Law360

Law360

Law360 (March 27, 2020, 2:56 PM EDT) — The coronavirus outbreak is crimping venture fundraising, forcing cash-hungry startups to consider hard choices that could require delaying capital raising, slashing expenses, or accepting more investor-friendly terms if they pursue a financing round.For companies able to complete funding rounds, lawyers note that startup founders may have to settle for terms more amenable to investors.

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A little thread on how one venture capitalist thinks about the pandemic from a fund standpoint

By Keith Teare

Keith Teare is a Silicon Valley based, UK born, entrepreneur. He was involved at the founding of Accelerated Digital Ventures, Archimedes.Studio, TechCrunch, RealNames and EasyNet. He is US Partner at ADV today.

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