Some thoughts on #Meerkat

Downloaded Meerkat yet?

It's the new new thing.

The app is five days old and getting in with all the right names in the Valley.  (The company has been around for a few years, but this is a new product for them.)

It's so new, we don't even know if people are using it a second time, yet already it's been in the Wall Street Journal.  (PS...   Yuliya is really becoming an asset to the WSJ's tech coversage.  Future star to watch.)

In 2007, I was at the SXSW where Twitter blew up. That's how I was able to get into the Hatching Twitter book, where, for some reason, Nick Bilton refers to me as short. I'm 5'11'', thank you. How tall is Nick, anyway?

In 2010, Foursquare hit it big in Austin not long after their funding, which I accidently kicked off with a blog post. If only I could have pulled that off with my own startup. [sad trombone]

In 2011, GroupMe seemed to be the winner. I had funded it out of a hackathon earlier that year.

So after being around all these apps, eight consecutive years of going down to Austin, speaking three times, judging a thing, hosting the first SXSW wiffle ball tourney, I'm feeling pretty darn qualified to weigh in on the ultimate future of a five day old app.  I've even used it a couple of times!

If you can't tell, I'm being sarcastic...

You know the only answer VC's should feel qualified to give on this one?


Here, however, are a few early thoughts:

1) It's obviously the best live streaming mobile app we've ever seen. It's stupidly easy and the quality is way better than technology could ever get Qik to be back in the day.

2) Yes, it is definitely going to be a huge thing at SXSW. Yes, those of us not at SXSW (which I won't be this year... that's another story... just too big), will find it completely insufferable. You think we didn't want to see the Tweets and Instagrams of the parties... just wait to see how much we'll hate the drunk livestream of the parties.

3) Yes, it will get funded with a lot of money, very soon. I might even say that the Meerkat funding is peak VC for this cycle... b/c there's a chance that their next round is so big and so ridiculous that all the VCs just put the wire transfers down and step away for a bit. (How big? I'm thinking $25mm seed for 10% of the company... If only I was kidding.)

4) I keep thinking that it's going to get very popular among a 30's and 40's crowd of people that don't quite get that this kind of production and consumption kind of already happens on Snapchat. Snapchat may not be "live" but neither really is Meerkat. There's a few second delay... so what's the real difference between a few seconds and the minute or two if you get the Snapchat notification of a story being posted. Is it the interaction? Well, I don't think the comment interaction is that compelling. If you've ever sat in on a livestream (ustream, istream, weallstream...) and watched someone answer the comments, it's about as exciting as watching someone peel the skin off their feet.

5) Meerkat's UX is all about getting popular. The focus is on getting an audience. We've seen all that play out before in several mediums... and it just didn't drive quality. In social, most people don't want to popular, they just want to connect with their friends. It's too much pressure, and most of us just aren't popular or interesting--so it becomes a less than interesting experience for most of the users. If that's the case, then it becomes a broadcast channel, but one where each broadcast must be watched right away. That's pretty much the opposite of where TV is going. We don't want to have to watch things right away. That's a simple feature fix... let the streams last for even a couple of minutes. It's just as relevant... and it will bring more people to the water cooler. Otherwise, it's Youtube where you've got to watch the video as soon as it gets posted otherwise it disappears. I don't see that gaining mass adoption.

6) This one will be a struggle to monetize. Who's going to want to watch a branded Meerkat--and that's where the big dollars are, in ads. Brands work better in places where agencies can produce great content. Agencies aren't going to be able to produce great livestreams quick enough or fast enough to make the ROI worth it. Instagram is a lot better brand medium. If it's all about premium ones, that's fine, but that's not a multi billion dollar revenue stream.

7) If you thought that the bandwidth issue was soon going to be solved, think again. Austin infrastructure is going to bust open at the seams at SXSW. Meerkat is going to create all sorts of issues, especially for venues. First, if it wasn't clear before, free wifi has become table stakes. You just need it, like air conditioning, because the guy down the street has it. As quickly as they invent 4G, 5G, some hacker is going to create a mobile thing that sucks up a ton of bandwidth again. This creates the need for friendly network management. Venues won't want Meerkat broadcasting the Fall Out Boy concert via their wifi--or will they? Some will, some won't. Some might let you do it in exchange for something else (A premium purchase? Tweeting out the venue? A check in?). This is why people are starting to talk to companies like SocialSignIn--because they know wifi can be used for good and not evil (i.e. just a big cost sinkhole), but they don't exactly know how. When everyone is Meerkatting, how can brands and venues leverage access to more bandwidth, a key component of livestreaming, to their advantage?

8) All this being said, I am finding the notifications pretty addictive.  I do want to see what people are up to... and some people are pretty cool, funny, etc.  If it gets critical mass, watching a series of streams live from news events could be amazing.  Clearly stream discovery will be key, but this could very much be the dream of see anywhere in the world, right now.... which a lot of people have been thinking about but no one has made easy. 

And that's everything I know and think about Meerkat five days into the life of the service.

I reserve the right to be completely and unequivocally wrong about this whole thing, which, as a VC I tend to be about 50% of the time.

Pitch me!

Working out of the Townhouse has been an interesting experience in that I'm working side by side with a lot of non-startup people.  It's a co-working space full of creatives and freelancers, most of whom who have never pitched an investor, and probably never seen a startup pitch either.  Their reaction to what I do day in and day out is very telling about how a lot of people, including VCs themselves, think of the job.

The first question I always get, which I find endlessly hilarious, is "Don't you get tired of people pitching you all the time?"

Umm...  No.  That's, well, a big chunk of the job.

I say that, but I'm not entirely sure all my peers understand that.  One time, I spoke at a meetup that was divided into my talk and demos--and the organizer assumed I wanted to go on before the demos.  I didn't understand why it would matter, but she told me that most of the investors like going before so they could skip out after the demos and not get bombarded at the end of the event.  


Well, I guess I'm not surprised.  I've had a debate with other investors before about the "warm intro" requirement.  For a seed fund, I find it a bit silly.  Most founders barely have anything that looks like anything at this point, and most of them haven't done this before.  

How good of a screen could someone else who doesn't do what I do be to make the intro?  

Great, so you went to coffee with someone I know or maybe even funded once.  The founders I backed aren't VCs (well, except Dave) so I don't know if that is such a great signal.  

I asked another VC why they do this and they answered, "So we don't have to go through all the random crap."

If you're an investor that has a magical dealflow stream that isn't mostly random crap, please tell me how you do this.  Also, if none of the investments you made first looked like random crap at the beginning, and you have a great track record, I'll buy you lunch.

Obviously, there's a wide spectrum of founders trying to raise money.  A lot of them have really really terrible, poorly thought out ideas.  In my life, I, too, have had a lot of really terrible, poorly thought out ideas.  It happens to the best of us.  But, they're trying--and I try to see where they're coming from.  That's why I don't mind hearing from them.  I'm just trying to be helpful.

That's the key--when you think you can help just about anyone, and you really do like helping people, each new pitch is an opportunity.  

That's also why I like hearing from people who really don't need to pitch.  There are some extremely well connected founders who have achieved lots of success that either self-fund or just get the band back together for their last deal.  No one is ever going to turn them down, and they know more money than they need.  The idea that they need to go pitch someone they might not know as well isn't on their radar, but it should be.  

First, their best buddies from their last startup are probably going to give them a free pass or two--and a good investor audits your thinking--challenging you where the story might not be as strong.  Just the other day I had a great conversation with someone who had already raised, had a good product and was making excellent progress--and I thought he was undercutting himself with some really conservative financing plans.  In my mind, he was going to need to be right back in the market again and was wasting a round, taking 20% dilution when he didn't need to be.  I may not have convinced him, but I think he found the conversation helpful and I was happy to help.  

So go ahead and pitch--but please keep in mind the following:

1) If you haven't done your homework on your idea, it's hard for me to be that helpful.  Talk to potential customers and others who know the space really well to learn what has come before you in this area--why it worked and why it didn't.  Don't make too many assumptions about why Instagram will never do this or why so and so failed.  I don't mind getting idea stage stuff, but at least do a little bit of work on it.

2) Pitching is not about getting me to say that something is a good idea or bad idea.  It's about working out a plan and finding out whether or not I want to be a part of that plan.  A lot of people ask for "feedback" but they don't have a specific question or some assumption they want me to agree or disagree with.  The more specific the answer that you're looking for from me the more helpful I can be.  

3) Grabbing me at an event for thirty seconds is just about the worst justice you could do your startup.  In person is a great chance to establish that you're not a nutball and that you're the kind of person I'd like to engage with going forward.  Telling me your name, your background and that you're going to follow up with me by e-mail about an idea to [insert thing worth doing] is so much better than a rushed pitch.  Let's just talk like humans who aren't in the middle of a potential transaction first.

4) It's my job to hear you out.  Please don't apologize or act like you're bothering me.  Don't say, "I'm sure you're really busy."  What do you think I'm really busy with?  Other pitches!  This is what I signed up to do.  You can't get the big fat carry check when your rocket ship investment goes public without talking to some new entrepreneurs really early.  

5) Don't get antagonistic if I say no.  If I thought it wasn't for me, I might be missing out on something, but if I understood your idea and just wasn't into it, you need to move on and find someone who is really psyched.  I'm not that person and now the clock is ticking on additional minutes wasted trying to convince me.

Best of luck.  I look forward to hearing from you... really!

Why You Need to Stop Hating Self Promotion

I counsel a lot of job seekers looking to get into the startup world.  Very quickly, I lay out the fact that getting a job comes down to two very simple things:

1) Do you know what you do?

2) Does everyone else?

That's it. 

If people had a clear concept of what value you bring to the table and lots of people understood that value, all you'd have to do is tweet that you were a free agent and the opportunities would come to you.

The only problem is, people don't like self promoting--and that's what they see the second part as.  Tweeting, blogging, speaking on panels--as much as, ironically, you're reading this blog post and don't seem to have a terrible impression of me, you associate terms like self promotion and personal brand building as a narcisistic, somewhat douchy exercise that involves a lot of chest pounding and boastfulness.  It's not how they want to talk about themselves.

Well, it doesn't have to be.  

Your blog doesn't have to be like that.  Your voice won't be seen as full of hot air--if you stick to what you know and self edit your tone.  Can't you do that?

If Forbes wanted you to write a weekly column on the professional world around you, wouldn't you take it?  So why is a blog any different?

There are lots of interesting opportunities out there, but it's incredibly hard for a startup team to go from not knowing anything about you at all to making you employee number five.  It's exponentially easier when they're imagining who would make a great head of customer service and they think of you right away because you write this neat blog about the tactics of making customers happy.  

If you really want to do what you love--let everyone know you love it.  Be a public student of your craft.  Show others what you bring to the table by writing down what you learned and what's hard about what you're still in the process of learning--and what's changing all around you.  

Otherwise, you're leaving your job satisfaction to the randomness and inefficiency of having a resume speak for you.  You wouldn't hire a wedding photographer without an online portfolio, so as a knowledge worker, where's your online portfolio?  How do people understand what you and your brain bring to the table when they search for you online?

Check out Medium and start writing what you know to be true and what questions you think your next employer needs your help to answer.

The #vcbcc List

Two things ain't nobody got time for:

1) That.

2) Keeping track of all of the various criteria and foci of the hundreds of potential co-investors you could have in a seed round.

Especially not as a one partner fund.  

Given that I often help my companies finish fundraising by introducing them to other investors, I wind up making a lot of intros.  Keeping up with who does extra stage, what defines too early, who will only do B2B, consumer, etc., is a huge pain in the ass.  

Granted, sometimes it's really clear that a deal is right for one particular co-investor, and that person or fund has done a great job branding that they want to see those types of deals, most VCs will look at a lot of different things and do things by exception all the time.  Plus, they're always shifting around or refocusing on certain things.

So I've mostly given up.  

Instead, I've started circulating a private list of things I'm working on--as well as a note about when some of my companies might be raising.  I've also thrown in a few notes about good people I know who are looking for opportunities.  

You want to know what deals I'm doing?  Here they are.  Knock yourself out.  It's actually what SV Angel used to do back in the day, before the days of Angel List.  

I've taken to calling it the #vcbcc list.  Every month I send out a BCC note to about 190 investors who I know well, have done deals with, or who have asked me to keep them in mind for deals.  I've sent out about three or four of them now and I'm thrilled to say that the list has now sourced over a million dollars of co-investors.  Moreover, it gets me deals back in return--because sometimes it's just a matter of being top of mind for someone.

The best part is, a lot of the interest has been from VCs I wouldn't necessarily have thought of for that particular deal.  

Do I worry about other people crowding me out of these deals?  No...  because if I try to make sure I build good enough relationships with the founders so that I can anchor my position in a deal when we send it far and wide.

Do I worry that these investors might be in competitive deals?  No... because if the mere fact that someone is fundraising is enough information for a competitor to crush you, then you've got other problems.  

Why not make this list public?   Because the world of customers and media doesn't need to know who is raising.  PR happens when stories are carefully crafted, and sometimes fundraising takes a long time, even for the best companies.  

If companies struggle to fundraise, won't it look bad that they're still out there?  Actually, the last company that just raised off my list has been out there for six months--and I've posted it to the list a couple of times.  Why it tipped this month, I have no idea.  

So there you have it.  A VC hack of the week.  If you're an investor and you'd like to be on the list, let me know at

The Board Before the Board

Forming a board...  It's what the best performing companies do once they take on outside investors.  Board members can provide useful feedback, help to focus the founding team, and provide a network of contacts.  

Unfortunately, many companies don't get financing--because they don't get any of the above.  They don't get the feedback they need, especially around priorities.

Sometimes, the founders lack focus to the point where they don't even get to the point of company formation.  They get caught in a sea of too many problems, too many opportunities, without a good idea of what to do first to coalese their ideas into a single vision.  

A lot of friends and potential founders come to me with tons of ideas, or none at all, or half of one--but with the will and drive to create something, making it all extremely frustrating for them.  What do they do first?  How do they pick out their idea?

It's hard for me to get too involved, because committing time to help is a slippery slope.  For advisors, there's a real gap between one coffee and joining the company.  You want to help, but your time is limited.  

That's how board participation can help an advisor scale.  You're on the hook for a finite amount of meetings and the meetings are structured in such a way to prioritize the discussions that create the most impact on the company.

So why wait until you have a company to set up a board?

Most people have a fair number of people willing to help, but they get stuck in trying to figure out how to get the most help out of them.  

Setting up a simple board before you've even got a company can help you get into the practice of collecting feedback and getting nudged back into focus.  Going through the discipline of being accountable for your time, setting and sticking to goals and simply talking through problems with others can bring clarity to chaos.

I'd recommend that if you're going to get something off the ground, there are three people worth talking to on a monthly basis in person, with maybe a bi-weekly, midway checkpoint in between.

First off, you want someone who is generally knowledgable about business--someone the dollars and cents are going to make sense to.  They should understand concepts like profitability, contribution margin, time value of money, opportunity cost, etc--so they can help anchor the conversation around high impact financial opportunities and cost effective ways to take advantage of them.

Second, you want to talk to someone who understands the problem set you're going after--an industry expert.  Who is going to help point you in the right direction of who to talk to, or who can speak from the perspective of the customer?  Sometimes, just knowing who might have tried similar ideas before can be helpful to guide your research.

Third, I'd seek the honesty of a peer--someone on your level who you can trust to tell you when you're going down the wrong path, someone who can relate to what you're going through and provide emotional support as well.  

Over time, you'll create a real board of directors composed of investors looking out for their fiduciary interests--but for now, when you're in the stage of turning a spark into reality, a board before the board can take you a long way.