BC STARTUPS
Saved by @zmbnski

šŸ‘‡Thread.

Published a new essay: The red flags and magic numbers that investors look for in your startupā€™s metrics ā€“ 80 slide deck included!

 This was a deck that I created on my (longish) interview process with @a16z. It was a long path, starting with meeting folks at the firm 10 years ago. But the purpose of the deck was to explain how I would use my superpower in an investing context
Here's what I explain in the deck. As investors (whether angel or VC) we're often confronted with an up-and-to-the-right graph. Is it going to go up? Or down?
One solution to forecast these growth curves is the Growth Accounting Framework, where you add up New+Reactivated and subtract churned users. In each time period that gives you the difference in monthly actives.
The problem with this is that it's a lagging metric, not a leading one. We need to go one level deeper and look at the underlying loops that drive these numbers, to understand the quality.
For acquisition loops, I go through a number of different models. SEO+UGC, Viral, and Paid marketing.
In the deck, I break down how to get more granular on each step, and case studies for how to optimize the loop.d
From a metrics standpoint, it's important to analyze the acquisition mix, the quality of the signups, and the platform dependencies. In the deck, I talk through a bunch of the red flags I'm looking for.
I go through the same discussion for the Engagement Loop too. Examples, Upside, Metrics, and Forecasting.
Two kinds of engagement loops- Social Feedback and Content Personalization. There's obviously many others, but these are two that are particularly useful to think about.
I use examples from Pinterest, Twitter, and Uber. Both increasing the activation of users to get them pinning more, how to build a network, and unblocking users who've lost their password.
From a metrics perspective on engagement loops, I'll look at cohort retention curves, frequency analyses, and analyzing notifications too. I don't mention it, but the Power User Curve is important too: https://t.co/kdgO8PIspq
Once you have the Acquisition and Engagement Loops mapped out, and the potential upside, then you can build a forecast for MAUs. This lets you answer the questions you want to answer - where will this curve go?
Hope you enjoy the deck! Again, here's the link:
https://t.co/Kp7YSHTTs6
Thank you @bbalfour @ShaunMClowes @onecaseman @bubba @aatif_awan and the other folks who helped me along the way.

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šŸ‘‡ Thread. New deck getting published this week: "Consumer startups are awesome, and here's what I'm looking to invest in at Andreessen Horowitz." If you want to read it, subscribe to my newsletter here: https://t.co/262t8eh0wf


1/ A lot of new consumer technologies have been introduced to US households in the last 100 years. But it's taken many of them - like the telephone - more than 50 years to get to the majority of the US. Why is that?


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.@jaltma from @latticeHQ says ā€œDonā€™t confuse investor interest with product-market fit. Youā€™re about to be on the receiving end of a lot of hype and FOMO - use it to your advantage by taking the money and then keep your burn and ego low.ā€

.@typesfast from @flexport says ā€œI like to remind myself that even Bruce Springsteen still gets nervous before his concerts. Remember that, and then try to focus on what investors want: First, not to be bored. Second, to get rich(er).ā€

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.@zapier built a $140M ARR business on $1.4M in VC that has become the logic layer of the no-code industry.

But it has the potential to be something even bigger: the Netflix of productivity.

Our report and a thread šŸ‘‰

We believe @seqouia and @steadfast got a good deal buying into Zapier at $5B.

We value Zapier at $7B based on:

- 30-50% YoY growth over the next five years
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- 30-40% YoY growth of no-code TAM

No-code is huge and growing, but as @edavidpeterson has written, no-code is about more than tools: itā€™s about a philosophy that emphasizes interoperability and customizing your software to your needs.

https://t.co/UJY6BRtXwl


.@zapier enabled interoperability by building a solution to one of the intractable problems in SaaS: APIs that donā€™t talk to each other.

The product took off and hit $100M ARR in just 9 years, comparable to companies that have raised 100x as much money.

https://t.co/0Thk42eRpJ


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Dayton
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What I learned from raising my first seed round.

This isnā€™t a how-to guide, that may come later. This is just a story and observations from my own experience.

See, I didnā€™t know what I was doing at all...

We had a built a prototype, people seemed to like it. Investors seemed to like it. Not because I showed it to them, I wouldnā€™t know how to do that.

But I got a lot of inbound asking about the product and found myself stumbling into meetings with people with no real goal.

We decided it was time to raise and I had to figure out how to do that.

Iā€™m not from SF. Iā€™m from small town Missouri. I didnā€™t have connections.

But I did spend a lot of time making internet friends. Itā€™s what Iā€™ve done my whole life. In particular friends in @genzmafia

It was here I had some help from @nhuebecker on the first pitch deck I ever made. It went a long way btw - Thanks nick!

And met a lot of connected people thanks to @ItzSuds. He also got me on clubhouse.

In there I started talking to people and met @YousifAstar

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Shahed Khan
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8 things startups can do early on to optimize for focus & productivity:

1. Synchronous meetings only for p0 and p1 items

All meetings should be 25 minutes by default with the ability to extend by 15 minutes if necessary.

Each meeting should have a clear agenda that outlines its context, asks, action items, etc.

Meetings should be brief & impactful

2. Asynchronous for everything else

- Stand ups
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- Documentation walkthrough

A simple flowchart for meetings:


3. Strive for 90% focused work / 10% meeting & sync time

- No meetings on Tues & Thurs
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- Track your time to better understand your distractions
- Buy your team a copy of Deep Work & Getting Things Done

4. No recurring meetings

Recurring meetings are a productivity killer. Try to avoid them when possible.

Instead, assess whether a follow-up meeting is needed at the end of each meeting.
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