David Lee

Trying to bring something to the table.

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Peter Thiel on Mapping A Life

A good intermediate lesson in chess is that even a bad plan is better than no plan at all. Having no plan is chaotic. And yet people default to no plan. When I taught at the law school last year, I’d ask law students what they wanted to do with their life. Most had no idea. Few wanted to become law firm partners. Even fewer thought that they would actually become partner if they tried. Most were going to go work at law firms for a few years and “figure it out.”

That’s basically chaos. You should either like what you’re doing, believe it’s a direct plan to something else, or believe it’s an indirect plan to something else. Just adding a resume lines every two years thinking it will buy you options is bad. If you’re climbing a hill, you should take a step back and look at the hill every once in awhile. If you just keep marching and never evaluating, you may get old and finally realize...

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Keyser Soze

“[Keyser Soze’s] supposed to be Turkish…[o]ne story the guys told me, the story I believe, was from his days in Turkey. There was a gang of Hungarians that wanted their own mob. They realized that to be in power, you didn’t need guns or money or even numbers. You just needed the will to do what the other guy wouldn’t. After a while, they come into power and then they come after Soze. He was small-time then, just running dope, they say. They come to his home in the afternoon, looking for his business. They find his wife and kids in the house and decide to wait for Soze. He comes home to find his wife raped and children screaming. The Hungarians knew Soze was tough, not to be trifled with, so they let him know they meant business. They tell him they want his territory, all his business. Soze looks over the faces of his family. Then he showed these men of will what will really was.”...

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Investing in Things You Love

I wrote before about lessons I learned while investing. Here’s another. I don’t know if it’s a lesson; probably, more like an observation.

I like investing in products that I use or love. Here’s the problem with this. This doesn’t always work out well. And regardless of the outcomes, it can shade your decision-making process, which is even worse.

This is a classic example of an anchoring bias. You let an initial data point (“do I love the product?”) affect or infect your decision-making process afterwards. Sometimes it works out well like a Vine, Instagram or Twitter. But I can say from experience that more often than not - and this is by a wide margin - it doesn’t work out so well.

The converse is also true. Sometimes you look at a product and have a ‘blah’ reaction either because you don’t like it or you’re not the initial target user. So the whole investment decision process has a...

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On Writing

I’ve always been insecure about my writing. This isn’t some falsely modest claim. Growing up, I was much better at math classes than my English and history classes. My grades and SAT scores reflected that. I wasn’t “better” in the sense of getting an “A” in AP Calculus and a “B+” in AP English. I mean “better” in the sense of taking AP Calculus and not even qualifying for AP English. I wasn’t a voracious reader, to say the least. “Mouth reader” is probably more accurate.

After a break from studying engineering in my mid-20s, I was deciding between going to law school and business school. I decided on law school partly because it would help dispel some of my personal insecurities towards reading and writing. But that’s why I value getting my JD degree more than other putative accomplishments. Seems silly and a waste of $120K, but whatever.

In law school, I learned how to write for the...

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Things I’ve Learned - 6 Years

You talk about this stuff like you read it in a book.

-Ward Abbott, “The Bourne Supremacy”

I’ve been investing in or a part of startups for about 6 years. Given the volume and intensity here at SV Angel, I feel like it’s been in dog years. We’ve been a part of a prolific number of startups so I feel like I have been able to develop a unique and advanced “pattern recognition” when it comes to startups (and having Ron Conway as a mentor and advisor is a huge plus too, obviously).

That said, I’ve only been doing this for 6 years. I have a ton to learn. And I don’t say that out of any sense of false modesty. If technology cycles for investing are about 14 years, then I’ve only been a part of a third of one technology cycle. And one thing I’ve learned the hard way is that there are some lessons that only time and experience can teach you. As Ward Abbott would say, there are some things...

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James Gandolfini and Napster - The Originals

I’m beyond bummed to hear that James Gandolfini passed last night. There are a lot of reasons. I’m most sad because it’s the passing of his iconic character, Tony Soprano. There’s not much to say here that Alan Sepinwall didn’t capture in this memorial. I watch and read a lot of pop culture and Tony Soprano was by far my favorite character of all time. He was complex, heinous and also very human. He was also funny as shit - I even set up an Orkut page back in 2005 memorializing my favorite quotes. There are some at the end of this post.

Gandolfini was also a true original. As Sepinwall points out, he wasn’t the first choice for Tony Soprano. Other people could have played that part. But not many could have played it with the depth and humanity as he. Who knows - maybe I don’t know what I’m talking about, but for me, Gandolfini’s take was genius and original. For Godfather fans, only...

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Clean Deal Terms

Sam Altman has a nice post here on a founder-friendly term sheet. He said one thing there that I agree with 100%, among others:

I have an allergic reaction to complex deal structures, as they invariably end up with all sorts of unintended consequences. (link).

Lately I’ve seen more complex “deal terms” in early stage financings. One glaring example is the “super pro-rata right of X%.” This basically says that an early investor gets the right to invest not only their pro-rata in a next round of financing but X% more. A typical number might be 50%.

At first blush, this seems pretty harmless. It simply says that the investor can invest more than they have the rights to. The investor wins because if the company is a rocket ship, they can own more of the company. The company neither wins nor loses because it doesn’t preclude other investors from participating. And in exchange for giving...

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Startups, Growth and the Rule of 72

This essay by Paul Graham is one of the best on startups. In short, he makes the point that startups (and investors) covet growth. Without it, nothing else really matters.

I’m not the only one who thinks this was essential reading. With that in mind, more and more startups include their growth metrics either when pitching or updating investors (e.g., “X% growth week over week”; “Y% growth month over month”). Some of the stats are easy to interpret - you don’t need to do the math to understand 50% monthly growth over a sustained period is pretty good. But for other statements of growth, it’s less obvious to me. That is, I can’t immediately intuit if 10% monthly growth is ‘good’ and what does that mean. And obviously this depends on industry - 10% monthly growth for a mobile app may be not so good whereas for an enterprise software company, it might be healthy and borderline explosive.


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Our Next Megatrend

I think the biggest innovations of the twenty-first century will be the intersection of biology and technology. A new era is beginning.

-Steve Jobs, 2010

We at SV Angel invest in “megatrends.” We pick 4-6 investment themes and invest heavily in each one. Some of these trends include: real-time data, online-to-offline consumption, social commerce, collaborative consumption, education and the internet of things.

We believe that there is a massive opportunity in the intersection of software and biology, which we broadly define as “Health Informatics.” This term has a formal definition but we tweaked it to make our own. It is a software-first approach to solving problems in human biology, medical research and ultimately, patient care. We think the timing is right for software developers to make an impact in these areas. The ultimate goal is to use software, IT and data science to help...

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Welcome Back, Coach

I am thrilled to welcome (back) Brian Pokorny to SV Angel! He will join as a General Partner starting today.

Many people in the tech community already know Brian, a.k.a. “Coach”. He was most recently the CEO of DailyBooth/Batch, a startup that was acquired by AirBnB.

Prior to DailyBooth, Brian and I worked with Ron as partners for SV Angel on investment decisions and adding value to portfolio companies. Thus he is stepping back into a familiar role. However, he returns with a wealth of operational and startup knowledge from his 3 years at a startup. This experience will be invaluable insight for our portfolio founders. Many of the best young founders will already attest that he’s become a true “Coach” and trusted advisor to many entrepreneurs.

Brian has been angel investing since 2006 and reviewing investment opportunities since 2004. Having seen so many opportunities, he has...

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