June Notes From The Trenches
Welcome friends! Now that it’s officially summer and Chris’s and Matt’s juvenile sensibilities have been chaffing a bit from an extended run of serious content, we’re dialing it back this month with a trivia contest (“Who Said It: Founder, VC or Succession Character?”), but a couple of quick hits first.
If you haven’t subscribed to Matt’s weekly short(er)-form newsletter, you can do that here. It’s what the New York Times Newsletter Review would be calling “A must-read for anyone who likes venture, cynicism, and dated pop culture references” (if there were such a thing as the NYT Newsletter Review).
AI Craze Follow-Up
Last month we covered the burgeoning AI mania, and it has only picked up steam since. As with most trends, it’s mostly been interesting, occasionally funny (not all AI deal submissions being equal), and rife with notable plusses and minuses. Recent examples of each:
On the positive side, nearly all of our portfolio companies already employed AI tools to varying degrees in their SaaS products (yes, we’re saying we were in AI before it was cool). For two of these companies (Blutag, a SaaS platform that enables retail companies to offer voice-driven shopping, and Armilla, an AI insurance underwriting, and model-auditing SaaS platform) who were mid-fundraise when this thing really kicked into high gear, this has been a huge boon. Both are suddenly fielding more questions along the lines of “Why aren’t you raising more?” than “Why should I invest?” (same companies, new hype, but we’ll take it).
On the more negative side (mitigated a bit by the entertainment value), after a noticeable post-crash, across-the-board humbling for previously frothy segments of the startup ecosystem, we’re starting to see the occasional flare-up of extreme founder entitlement from AI startups here and there, reminiscent of some of the most egregious of our mid-bubble, Bay Area-origin deal flow.
One recent gem (saved here if you want to read the full submission) included the following product description:
“A cutting-edge AI company… leveraging the power of artificial intelligence to revolutionize various industries.” (Seriously, that was the entirety of it)
As well as things like:
“Align your investment with… Google, Alphabet, and Eric Schmidt.”
“We are offering a limited opportunity to invest… Don't miss your chance to be part of the future of AI… we require a commitment within 30 days to secure your investment.”
On the one hand, the return of humility was nice while it lasted. On the other hand, it allows us to address an embarrassing bubble-era oversight — that we never coined the term “Bay Area Hat Trick,” which will heretofore be awarded to any pitch that includes each of the following:
Fake FOMO/meaningless deadlines
Absurd name-drops
A clear implication that a handful of buzzwords is all the product description we should need
Okay, enough preamble; it’s trivia time!
Who Said It: Founder, VC, or Succession Character?
Despite being based primarily on the Murdoch family and traditional media, Succession’s characters frequently sounded an awful lot like some famous and/or notorious personalities in the startup world, so in honor of the conclusion of one of our favorite shows, we put together some quote trivia (and not to worry if you aren’t caught up, this is 100% spoiler-free).
The newsletter medium isn’t great for independently tracking results, so we’re going with the honor system here, but we will give a shout-out next month to the highest self-reported score (use email or the comments section).
Your choices for each question are:
A) Founder
B) VC
C) Succession Character
The Fraud Cohort
"In terms of the accounting mistake… I think there is a substantial discrepancy between… what the audited financials, the true financials were, what [we] understood, all of that was consistent — versus what the dashboards we had displayed."
“Maybe we discovered a metrics error that has overstated our subs in India by quite a… like if there were two Indias, it would make sense. But there aren’t two Indias; there’s one India.”
“We’re looking into an issue with subscriber numbers being bullshit. Not bullshit, but um… well, a little bit bullshit.”
“By the number of Ponzi schemes, there are way more… kinda per capita, than in other places. But by the size of the actual Ponzi, I’m not sure that it is particularly unusual. It’s just like a ton of extremely small ones.”
“Numbers aren’t just numbers; they’re numbers”
“I don’t want to dismiss ethical concerns here, but… I think in many cases; when there’s a conflict of interest, it’s an indication that someone understands something way better than if there’s no conflict of interest.”
“There’s a point where no corruption can be a bad thing. It can mean that things are too boring.”
“What am I gonna do with a soul anyways?”
The Nonsensical Startup-Speak Cohort
“It’s physical, social media in the real world.”
“The world’s first physical, social network.”
“Infinite brain box”
“A billion dollars of knowledge”
“Elevate the world’s consciousness.”
“Shoot it to the moon; new space cowboys in town”
“[Version] 1.0 is an external point-of-care BlackBerry.”
“Gotta up our velocity… break the log jam; get the franchise pump-pumping”
“Take the helm of a group of companies… from all different fields, much like a preeminent orchestra made up of virtuosos… and help them harmonize”
"We focus all the time on disrupting ourselves, and that's one of the core tenets in the way we operate"
“[It] is a great symbol of disruptive technology being able to, one, change the world, and two, obsolete itself."
The Best of the Rest
“The Quad Squad”
“I think I got a little cocky – I mean, more than a little bit.”
“You’re my boy. You’re my number one boy.”
“I hyper-decant. You don’t hyper-decant? You’re just doing regular decanting?”
"I don't give a shit about the environment. I just want to make money."
“I’m dumb, but I’m smart.”
“With all due respect, you can go f**k yourself.”
“I don’t want a yacht.”
Good luck!
Our Latest Investment - Uptime health
In our ceaseless quest to find productivity tools for the dirtiest, dull, and most dangerous verticals, we’ve landed a SaaS company targeting one of the marquee DDD sectors: dental equipment. Our newest company, UptimeHealth’s software, allows healthcare providers to roster all of their medical equipment and automate equipment calibration, issue monitoring, and technician dispatch based on industry best practices.
The seeds of Uptime’s solution come from the challenges co-founders Jinesh Patel and Bill Olsen faced while working in clinical engineering and maintenance management roles for large healthcare companies. Equipment management is an underrated, high-leverage issue for dentistry and other outpatient verticals. With high fixed cost structures, these businesses rely on tight appointment schedules to maintain high patient volumes, making equipment downtime incredibly costly.
Despite its importance, equipment maintenance is so antiquated that larger, multi-location practices often don’t even have an inventory of what they own. Each manufacturer’s equipment comes with different error code ID schemes and user interfaces that are either on the machines themselves (for older equipment) or on manufacturer-specific apps (for newer devices). As a result, every new equipment issue requires a bespoke diagnostic process, and finding available technicians can take hours of calls.
Uptime’s software inventories all customer equipment on a single platform and automates both issue identification and dispatch calls to customers’ preferred service vendors. Additionally, clients who do not have regular service vendors can use Uptime’s technician marketplace (for which Uptime makes additional transaction fees on top of its base SaaS revenue).
Uptime is initially focused on the dental vertical, but the platform applies to all outpatient ($18 billion+ TAM) and ambulatory healthcare providers (e.g., Urgent Care, Imaging Centers, ASCs, Optometry, Veterinary, etc.). Future product plans also include customer equipment purchase support, providing market intelligence on available options, and facilitating bulk and cross-product purchase discounts.
With the competition limited to more generalist facilities management companies (who generally only work with businesses with 500 or more locations with little to no proprietary tech), Uptime has an excellent opportunity to capture significant market share in the coming years.
C2V Watercooler
Head to our Instagram page for a microdose of Chris’s wisdom (Startupcybin? LVC?), with topics covering:
Why it is critical to have cold pitch feedback loops
How to fundraise in the current climate
Why AI is not a stand-alone product
In April 2014, Chris was interviewed for the New York Times Corner Office with the host and author Adam Bryant. His new book, The Leap to Leader, dives deep into how ambitious managers make the jump to leadership. It’s packed with incredible excerpts from the world’s best business leaders on various themes and subjects for those looking to make the leap. Chris was fortunate enough to say something halfway worthy and intelligent to make it into his book; that quote and topic are shared here.
Chris was invited as a guest speaker on the OMD RedTalks podcast. More to come in July’s newsletter, but we encourage you to subscribe in the meantime.
OMD RedTalks focuses on a culture of curiosity. Podcast discussions explore what's next, what's now, and what's orbital to all things marketing and media. This podcast aims to inspire our clients and teams and give them a vision of what could be the future of media and marketing. Subscribe here.
Portfolio Open Job Roles
Even though the world is doom and gloom on the job front, our portfolio companies are hiring! Please take a moment to check out the list of open roles and pass it on to anyone who is looking.
Portfolio Highlights
YC-backed Eze raises new capital for its secondhand electronics marketplace
Eze, a B2B marketplace that connects global electronic wholesalers allowing them to trade devices in large quantities with real-time market data, has raised $3.7 million in an oversubscribed seed round.
Founded by Joshua Nzewi and David Iya in 2020, Eze directly connects distributors and retail stores of used smartphones, mostly iPhones, and other electronics, including laptops and tablets, with electronics suppliers, providing access to an extensive inventory from over a hundred wholesalers and manufacturers.
Read the full article in TechCrunch.
Driver Technologies Announces $6 Million Strategic Funding Round
Driver Technologies announced the closing of a $6 million strategic funding round led by New York-based investment firm IA Capital and CT Innovations, the venture capital arm of the State of Connecticut. Major insurers, including Liberty Mutual Strategic Ventures, State Auto Labs/Rev 1, and investors from The Social Entrepreneurs' Fund, ID8 Investments, C2 Ventures, and Kapor Capital, participated in the round. With the closing of this round, Driver Technologies has now raised more than $16 million.
Olive’s AI Integration Takes a Bite out of the $800Bn IT Services Industry
Olive’s revolutionary platform empowers enterprises to collaborate on IT Decisions, uncovering the best-fit solutions for their digital transformation initiatives. With this seamless integration of AI, Olive now supercharges and expedites teams’ internal technology decision-making processes.
By typing in a simple prompt such as, “I am a CFO at a large healthcare company, and we currently struggle with XYZ challenges,” Olive AI automatically generates project scaffolds, including suggested requirements and use cases (survey business). Once the organization collaboratively identifies primary needs and requirements, Olive’s AI-powered solution takes this data and recommends solutions that can meet those needs.
Boostr Releases Proposal-GPT, Bringing Greater Productivity to Media Sales Teams
Proposal-GPT automatically processes and ingests the content of a received RFP, pre-populating key fields such as advertiser, agency, budget, advertiser objectives, and flight dates directly into a new proposal. With Boostr’s native email integration, sellers need not even open or review the RFP; Proposal-GPT automatically scans the attachment, extracts, and populates the relevant information into a new proposal for the seller. In addition to saving valuable time by eliminating the need for manual review and data reentry, Proposal-GPT also dramatically improves CRM adoption and pipeline accuracy: When a new proposal is generated, Proposal-IQ simultaneously triggers the creation of a new deal opportunity within the company’s CRM.
Otis’s has a newly updated website, and the app is now available. Check it out here.
Magellan AI Adds Support for Streaming Audio Measurement
Magellan AI, the podcast media planning and measurement platform, has announced support for measuring the performance of streaming audio campaigns alongside podcasts. Advertisers can confirm impression delivery by channel in the Magellan AI dashboard and measure ad performance through custom KPIs to optimize their current and future spending.