Veniam

Fred Wilson (Photo credit: Wikipedia)

The Bitcoin is all the rage. I do think it is as fundamental as the Internet itself was in 1996. But I have been worried Fred Wilson has become one dimensional and is only thinking about the Bitcoin these days. I guess not.

Here is a super exciting investment he just made, looks like: Veniam.

In my book Veniam is the most exciting move Fred Wilson ever made.

Google's self driving car might never happen. But you pair up an almost self driving car with Uber, and you get magic, much sooner. Singularity might never happen. My bet is it will not happen. But a lot of wonderful things will happen in attempts at singularity. This Veniam deal might be the real thing to Google and Facebook talking satellites and drones and balloons. Although I am big on satellites and drones and balloons.

Innovation has a funny way of upending the big dogs.

My comment to his blog post:

This is HUGELY exciting. I think you should get one on one with De Blasio, like NOW, and make this happen for NYC. They are talking old phone booths, which is great, but this is the real deal. A NYC where there is internet access every inch of the city is safer and is on its way to becoming One City. (Reference: De Blasio's Two Cities theme when he ran.)

The Bitcoin is as fundamental as the Internet was in 1996, I give you that. But for a while I was worried you have become a one track train with a laser focus just on Bitcoins. But I guess not.

Heck, this can be taken to Mumbai, to Kathmandu. What about backpacks? This could be taken to Namche! (Sagarmatha base camp ---- Sagarmatha, the Nepali name for Everest).

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At Union Square Ventures

@usv for a #Bitcoin event. https://t.co/vjNHu4blni
— Paramendra Bhagat (@paramendra) August 12, 2014

I'm at Union Square Ventures - @usv in New York, NY https://t.co/4qdlPkTvzR pic.twitter.com/9hJCgJXakM
— Paramendra Bhagat (@paramendra) August 12, 2014

Fred Wilson, Google, Facebook, Apple, USV

English: Apple iPad Event (Photo credit: Wikipedia)

Fred seems to have taken some flak for his comment that in 2020, Google and Facebook will be among the three biggest tech companies in the world, but not Apple. When asked if one of his portfolio companies will be among the top three he said, I most certainly hope so.

I am bullish on Google. I see it becoming the first trillion dollar company in the world. Usually when companies get big, they get innovation lazy. In Google's case when they have become big they have innovated at large scales. They have tackled problems that small startups just can't because they don't have the huge resources.

I disagree with Fred on Facebook. I am not sure Facebook will be among the top three in 2020. Facebook has been a one trick wonder. They have the option to be among the three, but I have not seen it yet.

I agree with him on Apple. Apple will milk the iPhone and the iPad as much as it can, but that momentum will last only a few more years, and then funny things might start happening to its standing in the stock markets. The next sexy hardware is not coming from Apple.

As for Union Square Ventures, I don't think they have a portfolio company that will be among the top three in 2020. I would love to be proven wrong. But that is a judgment call I am making. Point be noted I am not up to date on USV. I don't have a good knowledge of their investments in the recent two years.



Devices vs Cloud

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Late To The Bitcoin Story

I am running a little late to the Bitcoin story, but the buzz is inescapable. Gold was replaced by the government. Now the government itself is getting replaced. That makes it fundamental. It is Google not America that is leading the effort to take Africa online. That is notable. The nation state is being challenged, and not just by Wikileaks. The Bitcoin is about erasing the national boundaries and making global commerce frictionless, pretty much. The first global currency has been birthed not by heads of state and governments at summits but by anonymous tech entrepreneurs.

Bitcoin Hits the Big Time, to the Regret of Some Early Boosters

bitcoins, an intangible, digital currency that is backed by not gold or any government, but by math...... the cryptocurrency was set to upend the world of finance, perhaps more ..... Scribner, who, after buying large numbers of bitcoins early in their short history, has seen them soar in value ..... he bought his first 100 bitcoins when they were just $3 each, and then steadily amassed more at relatively low prices. A single bitcoin today now sells for just over $120..... ‘What does this do for global commerce?’ ...... easy transactions between conventional currencies, bitcoins, and a math-backed currency of the company’s own design...... CoinBase, the media sponsor of the San Jose event, received the largest venture investment in a Bitcoin business to date earlier this month. The company, which originated in the incubator Y Combinator and helps individuals and businesses use bitcoins, received $5 million from Union Square Ventures, a fund better known for backing Tumblr and Zynga. In San Jose, I also met the founders of BitPay, which enables online stores—including those hosted by Amazon—to take Bitcoin payment. Bitpay recently received $3 million from Founders Fund, led by Facebook’s first major investor, Peter Thiel....... how the company could help ease online commerce across borders ...... “Traditional payments such as credit cards don’t even work in half the world, so companies just choose to not service international customers” ..... could displace the practice of wiring money across borders, which underpins much international trade today and can be onerous ...... “If I’m trying to wire a supplier in China it’s a three- or four-day process with heavy fees,” he says. “Bitcoin transactions can be instant and free.” ...... BitPay, OpenCoin, and others also offer services that make it possible for a business to make sure incoming bitcoins keep their value by having them instantly converted to dollars. “Bitcoin can be used as just a transport network” ...... will enable money to flow as easily across the world, and between people, as e-mails and video do today..... Bitcoin’s earliest adopters were libertarians, cryptographers, and coders attracted by the idea of money that could operate without government oversight. They liked the idea that people could exchange bitcoins without knowing or trusting one another...... he quit a job with Goldman Sachs’s commodity desk in Tokyo to operate a private, one-man Bitcoin exchange business in Seattle. “These companies would be happy for it to just function like Mastercard. That is not what Bitcoin is about.” ....... the potential for a truly anonymous currency like Zerocoin to undermine existing financial and political systems ...... Bitcoin could hit the big time as less an idealistic reinvention of currency and more a technology to move payments more efficiently than today’s systems...... Jared Kenna, a 30-year-old Bitcoin millionaire

What Bitcoin Is, and Why It Matters

In 2008, a programmer known as Satoshi Nakamoto—a name believed to be an alias—posted a paper outlining Bitcoin’s design to a cryptography e-mail list. Then, in early 2009, he (or she) released software that can be used to exchange bitcoins using the scheme. That software is now maintained by a volunteer open-source community coordinated by four core developers....... “Satoshi’s a bit of a mysterious figure,” says Jeff Garzik, a member of that core team and founder of Bitcoin Watch, which tracks the Bitcoin economy. “I and the other core developers have occasionally corresponded with him by e-mail, but it’s always a crapshoot as to whether he responds,” says Garzik. “That and the forum are the entirety of anyone’s experience with him.” ...... Nakamoto wanted people to be able to exchange money electronically securely without the need for a third party, such as a bank or a company like PayPal. He based Bitcoin on cryptographic techniques that allow you to be sure the money you receive is genuine, even if you don’t trust the sender...... The existence of a public log of all transactions also provides a deterrent to money laundering, says Garzik. “You’re looking at a global public transaction register,” he says. “You can trace the history of every single Bitcoin through that log, from its creation through every transaction.” ...... If the Federal Reserve controls the dollar, who controls the Bitcoin economy? No one. The economics of the currency are fixed into the underlying protocol developed by Nakamoto. Nakamoto’s rules specify that the amount of bitcoins in circulation will grow at an ever-decreasing rate toward a maximum of 21 million. Currently there are just over 6 million; in 2030, there will be over 20 million bitcoins. ...... if more than half of the Bitcoin network’s computing power comes under the control of one entity, then the rules can change. This would prevent, for example, a criminal cartel faking a transaction log in its own favor to dupe the rest of the community...... “The combined power of the network is currently equal to one of the most powerful supercomputers in the world,” says Garzik. “Satoshi’s rules are probably set in stone.” ..... “Elaborate controls to make sure that currency is not produced in greater numbers is not something any other currency, like the dollar or the euro, has” ..... “In a Bitcoin world, everyone would anticipate that, and they know what they got paid would buy more then than it would now.” ..... even limited success could allow Bitcoin to change the fate of more established currencies. “Competition is good, even between currencies—perhaps the example of Bitcoin could influence the behavior of the Federal Reserve.”

Big-Name Investors Back Effort to Build a Better Bitcoin

OpenCoin, a startup with a new digital currency called Ripple...... digital currency called Ripple and tools for making transactions in other currencies, including Bitcoins ..... Ripple, the currency developed by OpenCoin, is similar to Bitcoin in that it uses math to prevent counterfeiting and fraud ..... transfers made with Ripple can be confirmed in seconds; Bitcoin transfers take, on average, 10 minutes to be confirmed, and many sites that accept Bitcoins make users wait an hour for confirmation ..... The company’s website for Ripple is more polished and easy-to-use than most sites built for Bitcoin users. As well as sending Ripples to other people, users can also send and exchange U.S. dollars, Euros, Bitcoins, and other currencies using the site. Ripple’s design has those transactions automatically routed through exchange companies that are working with OpenCoin. Tools are also available to allow others to offer software or websites that make use of Ripple....... Transferring Ripples is free, while transactions that involve converting between currencies involve small transaction fees—typically 0.02 percent. That’s significantly less than the fees levied by existing financial companies, such as PayPal, credit card issuers, or banks ..... “You can send e-mails for free, but not payments,” says Larsen. “Finally we might get finance to the place where e-mail or social networking has taken communication.” ..... OpenCoin plans to hand out some 50 billion Ripples in coming months, and more in the future, in an attempt to get the currency to function independently..... his company aims to turn a profit by retaining a chunk, likely 25 percent, of the total 100 billion Ripples that will ever exist, in the expectation that the currency gains value...... large Internet companies are starting to accept payments or donations in Bitcoin, including Expensify, Wordpress, and Reddit

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New York Tech Scene: Thriving

Technology Review: Fred Wilson

his first big deal was an investment in the Web community GeoCities, which Yahoo bought for about $3 billion in 1999. He went on to back startups including Twitter, Zynga, and Foursquare .... because VCs often shy away from technologies that take a very long time to bear fruit, such as many in energy or biomedicine, some critics contend that VCs flood the world with too much money for ideas that don't solve big problems. ..... the returns haven't been very good in the venture capital industry for a long time ..... There are a lot more places to go for money, which I think is a good thing for venture capital, because it allows more entrepreneurs to get going. We see more projects. There are more quality opportunities for us to invest in. At first blush, you might think that more capital means more competition. But I think what more capital really means is more entrepreneurs. ..... I don't think there's too much money sitting around. I think there's too much money in too few hands. So when six white guys in suits control two and a half billion dollars, that's not a good thing. Instead of being allocated just to one firm, it would be better if that two and a half billion dollars was allocated to 25 firms at $100 million each. It would lead to more diversity or people trying more things: data sciences, urban sciences, transportation, energy, materials science, and many others. ..... people who invest in venture capital like to go into deals together, and they like to invest in firms that have brand names and have long track records. That's what leads to a concentration of money in a few big-name firms

If You Don’t Know Your Co-Workers, Mix Up the Chairs

I learned early on not to feel badly about reaching out for help, and not to feel embarrassed about saying that you’re in over your head. We have a fantastic group of investors, and I’ve always felt comfortable asking for guidance. Early on, everyone in the organization became really comfortable with the idea that if there’s something you can’t do, just talk to someone about it or find someone to help you........ The importance of overcommunicating .. it’s taken me a while to realize that just because I understand things doesn’t mean that everyone else understands them. In our company meetings, I’ll say things that sound repetitive, but you have to do that. ...... As the company has grown, I can sometimes start to feel disconnected, and I’ll decide to randomly meet with one person a day, and we’ll go out for a half-hour coffee. You do that for six weeks or so, and then all the channels of communication are open again. ...... I always ask them for feedback, too. “Is there anything that I can do better to make your job easier? Is there anything I can do to make the company better?” ..... creates a really healthy environment so that people aren’t running off to a conference room and saying, “I can’t believe we’re doing this.” If you want to talk about that, talk about it in public. That’s one of the things that have made it easier for us to be 120 people and still feel relatively small. ..... I keep a notebook in my pocket and I write down all the stuff we could ever do with Foursquare. ..... I’ve learned when to bite my tongue about things I’m excited about. ..... We mix the seats up occasionally so that everyone gets to sit next to other people. And I’ll move my seat around so I’m sitting next to different people. They can ask me questions, and I get to know everyone better. ...... I started to feel a bit disconnected from our San Francisco office, so we got two big screens with cameras there and here in New York. They’re on all day long, so you just walk by and say: “Hey, Pete, what’s up? Can you get Ben?” It works so well. ....... this idea of weekly snippets. Every Monday, you send in a bullet list of the stuff you’ve been working on, and the software compiles a list and mails it out to the entire company. So you can quickly scan them to find out the status of a project or what somebody is working on. It gives you a nice general overview of the company. So you follow the people you want to get updates from, but we make sure that everyone automatically gets them from me and our C.O.O. and our head of engineering and our head of product. ....... When I send out mine, the first heading is, “Things I’m Psyched About,” and the next is, “Things That I’m Not So Psyched About” or “Things I’m Stressed About.” The next thing is usually a quote of the week — something I heard from one of our investors or maybe overheard from an employee — and then I have my snippets below that. ...... I get a lot of feedback from employees. It only takes them a minute or two to read, and it’s like a bird’s-eye view of what I think is going well at the company and areas where I think we could improve. It’s also a good way to start a conversation. ...... We always talk about when the company feels broken — let’s say you have 10 employees, and suddenly you have five more, and the stuff that worked at 10 doesn’t work at 15. So we’ll say, O.K., the company is broken — let’s step back and figure out how to fix it, and it might happen again from 20 to 50, from 50 to 70, whatever the numbers are. ...... The teams might be too big. Maybe there are too many reviews. There are all these little levers that we can tweak, and that’s how you take something that’s feeling a little bit broken, or not as efficient as it could be, and right it.

The Rise of the New York Startup Scene

"We never even had a conversation about, 'the only way to make it succeed is to go to California—should we pack up our stuff?' " ...... a pool of engineers who have come to or stayed in the city as companies like Facebook and Twitter built offices in New York ..... the amount of New York City-based startups that received venture funding rose 34 percent between 2007 and 2011, while deals in Silicon Valley declined 7 percent and those for the country overall dropped 8 percent. Last year, venture investors plowed $2.75 billion into 390 startups in the New York City area—the most money and investments since 2001 ..... So far this year, $942 million has been invested in 182 startups in New York. .... the Silicon Valley scene is still many times larger (1,202 companies grabbed $12 billion last year), and is nowhere near being eclipsed. Still, New York's startup growth is palpable ..... Like Crowley, Zach Sims decided to set up shop in New York when he cofounded Codecademy, a startup that teaches people how to write software code—even though his company's early days were spent in Silicon Valley as a participant last summer in Y Combinator ..... Sims and cofounder Ryan Bubinski had attended Columbia University in Manhattan, building up a network of people they wanted to hire, and their main investor, Union Square Ventures, is based in the city. Sims also thinks working in New York is a good way to be in touch with the kinds of people who would use Codecademy, since the startup's offerings are geared toward people who aren't entrenched in the tech scene—and those people are easier to find in New York than in Silicon Valley. ..... there's New York's always-on atmosphere: she'd worked previously in Silicon Valley and "felt like a weird person" leaving the office at 2 or 3 a.m.—but New York is always buzzing. "You can get food here any time of night," she says. "You can get anything."

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VC Albert Wenger

Via Fred Wilson

Breakfast With Albert (Wenger)

I don't want you to think I was sitting across the table from Albert Wenger, and we had breakfast. That is not what happened.

There were 100-200 people on two floors. We did have breakfast, cupcakes and milk. And Albert was there. But he showed up on stage mysteriously from behind.

Events: Week Of October 3

8:30am - 10:00am CreativeMornings/NewYork with Albert Wenger
Galapagos Art Space DUMBO, 16 Main Street, Brooklyn

So there was breakfast. And there was Albert Wenger.

I think he gave a great talk. It is a shame people like him get outgunned by stupid people lobbying really, really hard on Capitol Hill to defend old industries that can not be defended.

I was sitting in the front. I got to ask the first question. I asked him if he were to put together a trillion dollar stimulus bill for this economy what might it look like? He said the biggest part of it would be about getting cheap broadband to everyone. That reply was in total sync with my own thoughts on the topic.

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A Facebook For Strangers

Image via WikipediaFred Wilson: Turntable
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My current Facebook is my second Facebook account. They booted me out the first time because I was oh so busy saying hello to strangers.

I like Twitter a lot, because on Twitter everyone has a phone number. And if someone is not on Twitter, that person is not relevant, at least not relevant to the world of tech. And the transparency and the 140 character limit makes managing communication easy. It is scalable.

The first phase of web social has been about connecting with people you already know. The far phase has to be about strangers. Utter, complete strangers, people you have absolutely no hopes of meeting in person.