FundersClub Weekly Newsletter - July 28, 2016
FundersClub Portfolio News
Bannerman is hosting an upcoming hackathon to inspire people to build terrorism fighting technology. Everyone is welcome to apply. No experience in security necessary. Bannerman CEO Johnny Chin was moved to plan the event after reading The Siege: 68 Hours Inside the Taj Hotel. Hackathon Against Terrorism
Upcounsel, the marketplace for attorneys, is among the 15 tools that Tech Cocktail recommends startups keep in their legal quiver. Attorney Marketplace UpCounsel and 14 More Tools Any New Startup Needs
Bellabeat has opened the wait list for its new wearable, the Leaf Urban. It's designed to appeal to more fashionable wearers, as it's smaller and can be worn on a bracelet or a clip. Bellabeat's Leaf Urban brings stress tracking to smart jewellery line
Cleartax has created a portal for filing business tax returns in India that reduces the 28-page ITR-4 form to just six steps. Whereas competitors like TaxSpanner, H&R Block and MyTaxCafe offer online processes that are assisted by a human accountant, ClearTax founder Archit Gupta says his company reverse-engineered what an accountant does and has built that into the product. This Startup Wants to Help Small Businesses File Their Tax Returns
Instacart has expanded into San Diego, giving it a thorough footprint across Southern California, where it already served consumers in Los Angeles and Orange County. The expansion will open on-demand grocery delivery from Whole Foods Market, Costco, and Ralph's, among others, to approximately 365,000 San Diego residents. Instacart Launches in San Diego
Bluesmart's Black Edition suitcase can lock itself when its owner wanders from its side, and readily unlocks when its owner returns. Perhaps the bag's most vital feature, notes this reviewer, is its built-in 10,400 mAh battery that can charge other devices via a USB port. This smart suitcase locks itself as soon as it leaves your side and hates being left alone
Investor Thoughts
Christopher Steiner of FundersClub writes about the pull of Silicon Valley and its inherent strengths as a startup hub, but also investigates the advantages of growing a startup elsewhere. Data suggest being in the Bay gives startups a better chance of getting funded, but it also costs more from an operational standpoint. Founders and investors weigh in on both sides. The Right City Can Give Your Startup a Better Chance at Success
Pedro Sorrentino of FundersClub writes that there is a clear correlation between the quality of company updates issued to investors and how the company is currently faring. Founders needn't make these documents exhaustive, but they should be data-driven, honest and concise. Building a startup with integrity: why investor updates matter
Brad Feld of Foundry Group writes that every company that gets to 50 people or so wastes about 20% of its collective time on overlapping systems and inefficient processes. Dedupe Your Processes
Fred Wilson of Union Square Ventures reviews the sale of Yahoo to Verizon, saying that the life cycle of tech companies is a straightforward thing. "They start, they grow, they mature and they consolidate." Yahoo has clearly reached the later stages of this cycle, and its sale makes sense.Start, Grow, Mature, Consolidate
Tomasz Tunguz of Redpoint Ventures once again puts forth original content on the SaaS space, this time detailing why the rate at which SaaS startups form has been slowing down. He points out that incumbents have now been established in most spaces, which has made things harder for new companies. The Decline Of New SaaS Company Formation
Geoff Ralston of Y Combinator offers his thoughts on how companies should prepare and pitch on their Demo Day. Ralston's advice draws on the more than 1,000 pitches that YC companies have put together since the accelerator's first demo day in 2005. A Guide to Demo Day Presentations
Founder and Operator Thoughts
Robert Allen of Smart Insights offers a quick overview of statistics gathered by Totango that show the kinds of metrics tracked by most SaaS companies. According to the data, 80% of SaaS companies measure churn, but only 54% measure revenue per user. The metrics measured by SaaS businesses
Ganesh Swami of Silota writes that SaaS startups, depending on whether they're venture backed or bootstrapped, need to pay attention to different sets of metrics. Cash is obviously important to all kinds of companies, but it needs to be managed more conservatively for bootstrapped businesses—and the metrics should reflect that. Why Customer Lifetime Value is a misleading metric for Bootstrapped businesses
Bill Fernandez of Omnibotics talks with Craig Cannon of Y Combinator's The Macro about being the very first employee at Apple. He discusses growing up in Silicon Valley, Apple’s early period, moving to Japan, returning to Apple, and advice for early employees and founders.Employee #1: Apple
David Heinemeier Hansson of Basecamp discusses why startups should ignore the "drums of the unicorn." Get out of San Francisco, and get back to business fundamentals, he advises. The creator of Ruby on Rails has chosen to define success "as doing what I do every day with a smile. The act of programming, and getting better at it." Resisting the lure of unicorn culture
Grant Canary of DroneSeed goes over all of the SaaS that he feels is integral to his startup and why others should also use them. The piece is structured as an open letter to new Techstars startups. The Core SaaS Products New Techstars Companies Should Consider
In Other News
Apple has tasked senior executive Bob Mansfield with heading up the company's ambitious car project. Mansfield is highly regarded throughout the company and Silicon Valley after heading up Apple's teams that created the MacBook Air, the iMac and the iPad. Now he owns what's known as Project Titan. The Wall Street Journal: Apple Taps Bob Mansfield to Oversee Car Project
Amazon has partnered with the British government to ramp up a program that tests drone flight and delivery. This could put Britain ahead of the United States for seeing the first Amazon deliveries by drone. The tests will begin immediately. The New York Times: Amazon Expands Drone Testing in Britain
Marni Walden will be in charge of knitting the assets of Yahoo into Verizon, which purchased the web company for $4.83 billion in cash. Walden, Verizon's EVP and president of the product innovation and new businesses organization, has already overseen Verizon's $4.4 billion acquisition of AOL a year ago. Meet the Woman In Charge of Bringing Verizon and Yahoo Together
Driverless Cars pose a serious threat to the insurance business. The technology may be years or even decades away from being widespread, but firms are already scrambling to figure out how to deal with an expected decline in premium revenue as autos become safer. Driverless Cars Threaten to Crash Insurers’ Earnings
A Miami judge ruled this week that Bitcoin is not money, in a case against a website designer who had been charged with laundering money. The law can't apply to Bitcoin, the judge ruled, writing: "The court is not an expert in economics; however, it is very clear, even to someone with limited knowledge in the area, the Bitcoin has a long way to go before it is the equivalent of money." Bitcoin not money, Miami judge rules in dismissing laundering charges
Did You Know?
Creative genius has long been associated with sadness and melancholy figures: the author who commits suicide, the painter who slices off his ear, the brilliant composer tormented by depression. The link between sad feelings and creativity hadn't been quantified until now. An economist at the University of Southern Denmark recently studied the moods and productivity of Beethoven, Mozart and Franz Liszt. The downside of being happy