أكتوبر 2020 - Fabrice Grinda

Episode 7: FJ Labs’ Startup Studio Model

Last week we covered whether first time founders should build a company on their own or join an accelerator or a venture studio. As a follow-up, I wanted to present the specifics of the FJ Labs startup studio model. Anthony Valente, Andrea Xu, and Charles Gorra join to describe their experiences at the various stages of our program.

For your reference I am including the slides I used during the episode.

If you prefer, you can listen to the episode in the embedded podcast player.

In addition to the above Youtube video and embedded podcast player, you can also listen to the podcast on:

Episode 6: DIY vs Accelerator vs Studio

This week we cover whether first time founders should build a company on their own or join an accelerator or a venture studio. Nancy Dong, our first ever guest on Playing With Unicorns, joins to share the framework she used to decide whether she should join FJ Labs as an entrepreneur in residence (EIR) after stints at Uber and Harvard Business School (HBS).

For your reference I am including the slides Nancy used during the episode.

If you prefer, you can listen to the episode in the embedded podcast player.

In addition to the above Youtube video and embedded podcast player, you can also listen to the podcast on:

Episode 5: Ask Me Anything

Given that I was in Lake Placid looking at the foliage change without my multi-screen setup, I tried a “Ask Me Anything” session for the week. It was a resounding success with very varied questions.

We covered:

The impact of antitrust laws on the venture ecosystem
The differences between being an angel and running an early stage fund
How we acquired the first customers at OLX
Whether marketplaces should start by building supply or demand
How to build your brand in VC
How to prioritize your time as an entrepreneur
How foreign startups can succeed in the US
Whether we are in a tech bubble
Whether startups should be hyperlocal, national, or global
My thoughts on impact investing relative to philanthropy and traditional venture investing
Whether hunting unicorns is the only viable path for entrepreneurs
The state of startups in Africa and whether once could build a unicorn via a rollup
Whether business plans are worth the paper they are written on
Whether it is essential to be in less competitive markets to succeed
What company I would have loved to have founded
Whether I will operate another startup in the future
The role debt can play in financing startups
Whether investors in the pre-seed / angel round should also invest in seed rounds
Whether YC is correct to focus on user and revenue growth rather than other metrics
What my guiding philosophies have been over the year
Whether macroeconomic considerations should be relevant when building or investing in a startup
Which investment gave me the best return
My perspective on Bitcoin
My thoughts (or lack thereof) on the stock market
The pros and cons of learning to code as a founder
The use of a single vs. multiple KPIs as objectives for teams in startups
Why VCs invest where they are located
How useful is a college education to an entrepreneur?
What helps me stay open and creative
My thoughts on The Social Dilemma

I stand by all my answers, but I should complement one of them. With regards as to whether tech is in a bubble, I explained why the low interest rate environment was leading to frothy valuations, but not (yet?) a bubble. However, I should have mentioned that the SPAC world is in a bubble. There are lots of SPACs chasing a few good companies leading to significant adverse selection. The best companies are IPOing outright. The mediocre companies are SPACing. Also, SPACs have historically underperformed the market. Of the 313 SPACs IPOs since the start of 2015, 93 have completed mergers and taken a company public. Of these, the common shares have delivered an average loss of -9.6% and a median return of -29.1%, compared to the average aftermarket return of 47.1% for traditional IPOs since 2015. Only 29 of the SPACS in this group (31.1%) had positive returns.

If you prefer, you can listen to the episode in the embedded podcast player.

In addition to the above Youtube video and embedded podcast player, you can also listen to the podcast on:

Angel investing at scale

I had the pleasure of being interviewed by Pankaj Jain, the host of Invest Stream. We discussed how being an entrepreneur led me to becoming an angel investor then went in depth on how to be a good angel investor.

A few takeaways:

Have an area of focus: you will make better investment decisions and be more value added by focusing on an area of expertise. In turns this lets you create a brand in the category which leads to more and better deal flow and ever better decision making.
Have a diversified portfolio. Venture investing follows a power law with a few startups generating most returns. The larger your portfolio the better you do. Ideally have at least 100 angel investments.

Episode 4: FJ Labs’ Investment Thesis

In the third episode, I described how VCs evaluate startups by using a combination of the team, business, deal terms and whether the idea fits with their thesis to decide whether to invest or not. In this episode, I present FJ Labs’ Investment thesis.

I start by covering why we focus on marketplaces, then detail:

Our current marketplace theses:
- Verticalization of horizontals
- Transition to supply pick marketplaces
- B2B marketplaces
The Future of Food
The Future of Work
The Future of Real Estate
The Future of Lending

For your reference I am including the slides I used during the episode.

If you prefer, you can listen to the episode in the embedded podcast player.

In addition to the above Youtube video and embedded podcast player, you can also listen to the podcast on:

Episode 3: How VCs evaluate startups

In the first episode I covered how and when to fundraise. In this episode, I describe how venture capitalists (VCs) evaluate you once you are in front of them to help you refine your approach and pitch.

I explain how VCs use a combination of the team, business, deal terms and whether the idea fits with their thesis to decide whether to invest or not. I also detail:

What are unit economics
Expected traction and valuation at various stages
That venture capital follows a power law
How various VCs weigh the different investment criteria based on whether they are playing “Powerball” vs “Moneyball”