Tech Brew Ride Home - Thu. 12/12 - Maybe Just Throw A Dart, Seed Investors…

Episode Date: December 12, 2019

Google releases all the things at once, everyone is mulling over Jack’s decentralized Twitter idea, one last tech IPO of the year, should seed investors just say yes to every deal, why you should know the Canva story, and why Cousin Greg playing Adam Neumann is my Christmas dream come true. Sponsors: PixelUnion.net GiveWell.org/ridehome Links: FTC Weighs Seeking Injunction Against Facebook Over How Its Apps Interact (WSJ) Google is bringing spam detection and verified business messaging to Messages (The Verge) Interpreter, Google's real-time translator, comes to mobile (TechCrunch) Bill.com’s Stock Takes Off On IPO Day (Forbes) AI R&D is booming, but general intelligence is still out of reach (The Verge) Startup Growth and Venture Returns: What We Found When We Analyzed Thousands of VC Deals (AngelList Blog) Bluesky early thoughts (Sriramk.com) Hey @Jack Dorsey, decentralizing Twitter won’t solve hate speech problems (Digital Trends) Inside the Podcast that Hacks Ring Camera Owners Live on Air (Motherboard) Canva Uncovered: How A Young Australian Kitesurfer Built A $3.2 Billion (Profitable!) Startup Phenom (Forbes) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech meme right home for Thursday, December 12th, 2019. I'm Brian McCullough today. Google releases all the things all at once. Everyone is mulling over Jack's decentralized Twitter idea. One last tech IPO of the year. Should seed investors just say yes to every deal? Why you should know the Canva story and why Cousin Greg playing Adam Newman is my Christmas dream come true. Here's what you miss today in the world of tech. I'm going to just put this right here because this just broke. and it's too late in the day for me to wait for more details. But Facebook shares are dropping sharply at this moment as the Wall Street Journal is reporting

that the FTC is considering a preliminary injunction against Facebook over antitrust concerns about how its various products interact. If it materializes the action by the Federal Trade Commission would focus on Facebook's policies concerning how it integrates its apps or allows them to work with potential rivals, these people said. Alongside its core social network. Facebook's key products also include Instagram, Messenger, and WhatsApp. The potential FTC action would likely seek to block Facebook from enforcing those policies

on grounds that they are anti-competitive, the people said. An injunction could seek to bar Facebook from further integrating apps that federal regulators might look to unwind as part of a potential future breakup of the company, one of the people said. A majority of the five-member FTC would be needed to seek an injunction. which the commission would need to file suit in federal court to obtain. The FTC declined to comment. Facebook declined to comment, end quote.

Again, an injunction would apparently aim to head off Facebook's mad dash to make its various products interoperable, more integrated, something that would make breaking up the company at a later date harder to do. Google has dropped an absolute truckload of news today. First, they have rolled out verified SMS. which labels messages from legitimate businesses as legitimate on Android phones. This is only in nine countries right now, and they've also expanded spam detection in messages to the U.S. But for that verified SMS, quoting the verge, Google is also rolling out verified SMS for messages you send to certain businesses.

When you're messaging with a verified business, you'll see the business name, its logo, and a verification badge in your message thread. Messages will be verified on a per message basis. 1-800 flowers, Banco, Bredesco, Kayak, Payback, and SoFi are among the first brands that will send messages with verified SMS according to Google, end quote. And Google also says it is changing mobile search results for news topics, adding more carousels of stories starting in the U.S. and rolling out later internationally. And Google has brought its real-time transatlose. translation mode called interpreter to the Google Assistant app on iOS and Android globally

with support for 44 different languages, quoting TechCrunch. The feature works in tandem with assistant. Say something like, hey Google, be my German translator or hey Google, help me speak Thai, and the feature kicks in, offering up real-time translated transcript and audio. The feature also offers some smart replies a la Gmail to help keep the conversation going. The feature is now available in 44 languages, up from the 29 available on the smart display slash speakers that this feature previously was limited to. It's integrated directly into the Google Assistant app, negating the need to download an additional translation app, end quote. Bill.com, a startup which automates payments for small and medium businesses, is bravely testing the waters for unprofitable unicorn startups.

Also bringing back keeping dot com in your name, all of the 90s. Last night, Bill.com priced its IPO at an above average range of $22 per share to raise $216 million at a valuation of around $1.6 billion. Quoting Forbes, since the stock began trading on the New York Stock Exchange under the ticker bill, it has been surging recently up 60% to $35. $0.8 a share. That comes even though Bill.com disclosed it had a net loss for its fiscal year ending June 30th of $7.3 million, wider than the $7.2 million loss it had for the year earlier fiscal year. Revenue did increase to $108.4 million from $64.9 million in the same time frame, end quote. The AI Index report comes out every year. It's come out again this year. And given how much we talk about AI these days, I think it was worth taking a look at the report. AI research has been skyrocketing. There has been a 300% increase in peer-reviewed AI papers this year.

AI degrees are popular also. AI is now the most popular specialization for computer science graduates in North America. For all the talk of China leaping ahead in AI research, the U.S. still leads the way in private AI investment. $12 billion of investment to China's $6.8 billion this year, though I should note that's private investment, not counting the investment that the Chinese government is making, but also the most popular, I don't know, I guess theoretical application for AI right now is still self-driving cars, which received more private investment than any other category, quoting from The Verge.

Just under 10% of global private investment went into autonomous vehicles, around $7.7 billion. That was followed by medical research and facial recognition, both attracting $4.7 billion, while the fastest growing industrial AI fields were less flashy. Robot process automation, $1 billion invested, and supply chain management, over $500 million, end quote. And Angel List has released a report that claims that seed stage investors can increase their performance and overall yields by simply investing in every single credible deal that comes their way instead of, you know, passing on most things and being discerning and only investing in the things that you really think are going to be a winner. Quote, how can you avoid missing the best seed deal? The simplest way is to put money into every credible deal.

Maybe you have a crystal ball that gives you perfect foresight, in which case you can pick only the best winners. Even then, if your crystal ball is even a little cloudy, eventually you will miss a winning deal, and that winning deal might have been the best performing investment. Simulations on a 10-year investing window for seed-stage deals suggest fewer than 10% of investors will beat the index, even if those investors have skill in picking deals. Like Vanguard has taught us in the public markets, individual investors could benefit from viewing the index as the default and then overlaying individual deals that they like, end quote. So maybe just like the stock market, maybe you just can't beat Mr. Market. But of course, this is almost a designed-in-a-lab post to really kick up the ire of VC Twitter,

which is one of the most easily upset corners of the Twitter sphere. I've already seen some pushback that suggests that the dataset Angelist used did not include money-losing investments, which, as was pointed out, would kind of be like calculating S&P returns by only including stocks that went up. But then others have said they actually explain all that in the paper. I don't know myself because I haven't had a chance to read the paper yet, but I'm letting you know the paper is out there, that this is its thesis, and that this is the debate that has been going on so far. So everyone is chewing over Jack's plan to decentralize Twitter, and I do mean seemingly everybody. So I should probably do a whip around.

The best explainers for what this all might mean came from first Sharam Krishnan, who might know a thing or two as. as he ran consumer products and audience growth at Twitter in a previous life. Also did monetization work for Snap and Facebook. In a brief blog post called Blue Sky Early Thoughts, Suriram said this, quote, The easiest mental model is this. Imagine if Gmail was the only email client ever developed, and SMTP and IMAP had never existed.

Gmail could have defined all things email, what is spam and isn't, or how various clients can work, if they can work at all. But that is not where we find ourselves since SMTP does exist. These are open documented standards which have evolved over years of open development. They allow any client to talk to Gmail servers and both interrupt and more importantly, innovate without permission. Superhuman can build an innovative experience on top of email without ever having to ask for permission from Google. Now compare this with the current state

of any social media product. You get a full stack, some of the most complex, intricate systems ever built in tech, which combines everything from relevance algorithms, content policies, verification policies, identity, incentive structures, among many other things. When you open up any modern social app, be it Twitter or TikTok or Instagram, you get this entire stack as designed and built by that particular company. Blue Sky imagines a world where things work a bit differently. First, this is developed out in the open instead of opaque, closed system implementations. You get a community-built effort and incentive systems to match. You reap the benefits of 20 years of the tech community, understanding how open-source communities work.

Second, more importantly, you get to see various implementations of the core pieces of the platform, end quote. He then goes on to list three theoretical examples of things that this might enable, like alternative ranking models, alternate verification policies, and alternate content moderation policies. In other words, new types of competition and differentiation could flower in the social space. And second, I liked this take from Twitter user at PRISM of Reality for just like a basic, you know, elevator pitch of what this is all about. Quote, Blue Sky will allow Twitter to kick you out of their club without feeling that they banished you from social media. You will not be welcome in their club, but you can go to any other club that you like.

It is a similar concept to Dave Rubin's locals, but built at a lower tech layer. It will also allow for experimentation regarding other forms of communities that manage their people differently. The key difference with locals is that everything you tweeted could move with you because the posts could live in multiple independent clients, like your emails, end quote. But then everyone is pointing out actual standards and protocols like these take friggin years to hammer out and can get seriously bogged. down. And lots of people keep pointing out that there are existing projects out there, like, you know, the W3C already has an open decentralized social network recommendation called Activity Pub. And of course, there's also Mastodon, which is the most visible implementation of the Activity Pub project. Massadon CEO points out that, quote, it sounds like Twitter is

making a Mastodon clone. But also this won't solve Twitter's hate speech problems. Masadon CEO Eugen Rochko told Digital Trends, my reaction is really mixed. I'm not happy that the announcement omitted the monumental work that's been done in this space by Macedon developers, end quote. Rochko also said Twitter's problems won't be fixed by decentralizing, quote, they could just clean up their own house. They could fix problems in their own space, he said. It does feel like an attempt to give up responsibility and distribute it to others instead, end quote. Indeed, one big question is, could Blue Sky simply embrace and extend existing projects like Mastodon or strike off on its own? The amount of name checking that Jack did in his tweet storm yesterday of blockchain technology suggests that he wants to go in a different direction.

And then, of course, there's all the snarking that Twitter was once kind of an open standard for real-time communications on the web, but then they went and broke the backs of all of those developers who had. worked to build cool stuff on top of Twitter. So should we take this seriously now or not? One of the many grody things among all the grody stories about Ring and its cameras lately is that seemingly every other day there are stories about the darn things getting hacked. In fact, Motherboard has discovered that a lot of those recent hacks that have made the news are the result of a podcast that seems to like to hack ring camera owners live on air. as people listen in. Here's the lead from the motherboard story. A blaring siren suddenly rips through

the ring camera, startling the Florida family inside their own home. It's your boy chance on nulled, a voice says from the ring camera, which a hacker has taken over. How you doing? How you doing? Welcome to the nulled cast, the voice says. The nulled cast is a podcast live streamed on Discord. It's a show in which hackers take over people's ring and nest smart home cameras and use their speakers to talk to and harass their unsuspecting owners. In the example above, chance blared noises and shouted racist comments at the Florida family. Quote, sit back and relax to over 45 minutes of entertainment in advertisement for the podcast posted to a hacking forum called Nulled Reeds. Join us as we go on completely random tangents such as Ring and Nest trolling telling shelter

owners we killed a kitten, nulled drama, and more ridiculous topics. Be sure to join our Discord to watch the shows live, end quote. Apparently, nulled cast members have been going through trying to delete all episodes and evidence of the show today. But this brings up a point about the ring camera, the Ness camera, any friggin smart device that you bring into your home. Apparently, all of those things have become the favorite thing for people to hack because you can just churn through the huge corpus of compromised emails and passwords until you find one attached to a device in someone's home. Apparently, people are like, oh, I bought this camera to serve as a baby monitor. I'll just use my usual password that I use for everything because,

you know, this is fun and I don't want to have to look up a password in the middle of the night if I wake up and I want to check on Junior. But no, no, do not do that. A camera in your home, That should probably be maybe the most unique lockdown password that you can get your hands on. Finally, today, I was considering saving this for the long reads tomorrow, but this is a story that I think more people should know about. Forbes has a profile up about Canva, a graphic design app that CEO Melanie Perkins helped build from a yearbook design business based out of Perth, Australia, into a profitable $3.2 billion serious rival to Mighty Adobe. This is a classic entrepreneur story in a way, except for all the ways that Perkins and Canva are exceptional. Quote, Canva was based in Australia, thousands of miles from Tech's Silicon Valley Power Corridor,

getting a meeting, much less funding, was proving tough. Perkins heard no from more than 100 investors. So when she met the organizer of a group of kite-surfing venture capitalists at a pitch competition in her native Perth, Perkins got to training. The next time the group met to hear startup pitches and potentially write crucial early-stage funding checks, she'd have a seat at the table, even if it meant having to brave treacherous waters. Quote, it was like, risk, serious damage, reward, start company, Perkins says. If you get your foot in the door just a tiny bit, you have to kind of wedge it all the way. way in, end quote. Such perseverance has long been a necessity at Canva, which began as a modest

yearbook design business in the state capital of Perth on Australia's West Coast. From those remote origins, Canva has grown into a global juggernaut. 20 million plus users from 190 countries use the company's freemium web-based app to design everything from splashy Pinterest graphics to elegant restaurant menus. Besides an impossible to beat price, millions of users pay nothing at all. Canva's key advantage over rival products from tech giants like Adobe has been its ease of use. Before Canva, amateurs had to stitch together designs in Microsoft Word or pay through the nose for confusing professional tools. Today, anyone anywhere can download Canva and be creating within 10 minutes. The company's revenue comes from upselling to a $10 a

month premium version with snazier features or more recently from sales of a streamlined corporate account option. High quality stock photos of which Canva has millions costs another dollar. It adds up. This year the company expects to more than double its revenue to $200 million. Its most recent $85 million funding round valued it at $3.2 billion. Perkins, an alum of the 2016 Forbes 30 Under 30 Asia list, has an estimated 15% stake valued at $430 million. Throw in her 34-year-old co-founder, and now fiancé, Cliff Obrecht's similar stake, and the Aussie power couple are likely worth more than $800 million, end quote.

So if you don't know about Canva, get educated. It's actually also a super good, super useful product, too. I mean, come on. How can I not point out that there are going to be two different Adam Newman WeWork projects in Hollywood? there's going to be a feature film, currently fast-tracked by Blumhouse Productions, written by the guy who won the Oscar for writing The Big Short. But also, and this is just, I mean, this is everything to me.

There will also be a limited run series produced by Chernin Entertainment and Endeavor Content that will star, and this is the best, Nicholas Braun, cousin Greg from HBO's succession. I mean, if you compare pictures of the two side by side, you can see how this will work, if Braun at least grows his hair out. They look alike, but let's be honest, I'd watch Cousin Greg do anything play Adam Newman. I mean, this is my Rise of the Skywalker News. Talk to you tomorrow.