#8/2020

“Organized competitive fighting trains the athlete to focus on the game and, in order not to dissipate his concentration, to ignore the possibility of what is not specifically allowed by the rules, such as kicks to the groin, a surprise knife, et cetera. So those who win the gold medal might be precisely those who will be most vulnerable in real life.”
• Nassim Taleb

Deals

Intuit confirms that it is buying Credit Karma for $7.1B in cash and stock (techcrunch.com)
  • Intuit — the accounting, tax filing and financial planning software giant behind QuickBooks, TurboTax plans to acquire Credit Karma with over 100 million users.
  • Intuit already has questionable reputation with lobbying the government to scale back free tax filing that if offers.
  • Opinion: Company with proven monetization model is acquiring a user company (Facebook x Instagram parallel) and should be blocked — acquiring for users is inherently more problematic than acquiring for capabilities.
  • Currently, there is a lot happening in Fintech with Honey, TD Ameritrade, Etrade and Plaid being acquired. This will create a lot of wealthy people who were early employees in the companies. These people have expertise in fintech and will try to invest and establish new startups in the industry, so it might be interesting.

Stonly grabs $3.5M from Accel to make customer support more interactive (techcrunch.com)
  • Stonly is building a service for customer support teams so that they can share step-by-step guides to solve the most common issues users have.
  • Stonly guide is a module that you can embed in your existing tools. The startup currently supports Intercom, Zendesk, Freshdesk and Front.
  • Opinion: I believe there is a lot of potential for startups to improve customer support. It is not so populated as it does not increase sales of the company, but on the other hand there is a lot to improve. We are currently looking into this space.

Liquid Death raises $9M to make canned water cool (techcrunch.com)
  • Sells canned mountain water. $18.99 per 12 cans.
  • The brand is about “so much more than loud marketing, it’s about sustainability.” The company makes a big point out of the fact that its aluminum cans are made out of more than 70% recycled material, and that aluminum is “infinitely recyclable.”
  • Opinion: I do not really understand their unique selling proposition. Yes the design looks interesting, but there is a lot of competition in the segment and this offering seems very pricy.

Reading

Y-Combinator Series A guide (ycombinator.com)
  • 70 page Series A guide including everything from fundraising preparation to investment materials, process, closing and benchmarks.
  • Only ~30% of founders who raise a seed round will go on to raise an A round.
  • It’s most important to demonstrate that you’ve made progress towards reducing these 3 risks:
    1. Technical risk - does the technology work?
    2. Market risk - will people pay for this?
    3. Execution risk - can you accomplish hard things?
  • It’s entirely possible to raise on a great story and no metrics, versus great metrics and no story.

Gotta Go Fast: Why Gaming IP Is Finally Taking Off in Film/TV (matthewball.vc)
  • Most of the movies based on game adaptations like Warcraft, Assassins Creed or Max Payne lost a lot of money with below 40% rating from critics, but new movies and tv shows based on games are still getting produced.
  • Modern games often run 15-200 hours in length making them hard to adapt into 2 hour movie, but Hollywood has shifted its focus from theatrical movies to SVOD-based series and gaming IP has become more in demand.
  • First success is Witcher. Once Netflix’s “The Witcher” started streaming, the video game saw its player count grow 3-4x, and the decades-old book series returned again to the Times Best Seller list.

Small article about COVID-19 (main source gatesnotes.com)
  • There are two reasons that COVID-19 is such a threat:
    • First, it can kill healthy adults in addition to elderly people with existing health problems.
      • Case fatality risk around 1%; compared to 1957 influenza pandemic (0.6%) and the 1918 influenza pandemic (2-3%).
      • The 1918 influenza pandemic (Spanish flu) killed approximately 30 million people (1.7% of world population).
    • Second, COVID-19 is transmitted quite efficiently.
      • The average infected person spreads the disease to two or three others. That’s an exponential rate of increase.
      • It can be transmitted by people who are just mildly ill or not even showing symptoms yet. This means COVID-19 will be much harder to contain than Middle East Respiratory Syndrome or Severe Acute Respiratory Syndrome (SARS), which were only spread by those showing symptoms and were much less efficiently transmitted.
      • There are examples of people being released and not having the virus and then developing it days later meaning it might not be detectable in the early stages. If this is true, it might not be realistic to contain.
  • Both the US and UK now have cases with community spread (person did not travel outside US and was never in contact with known cases).
  • Currently among 79 closed cases in Italy, 50 (63%) have recovered, 29 (37%) have died.
  • Also it is interesting to see the wealth gap between Western and Eastern Europe. Most of the richer countries in Europe already have many active cases while the poorer countries have 0 infected people because less of them are rich enough to travel.
  • People don't understand that if there is a pandemic, there will not be enough room in hospitals. Infected people won’t have the proper care and death rate can climb to over 10%.


   

In case you are interested in helping us with evaluating some companies and industries or you just want to discus any of these articles, feel free to reach out to Roman from Presto Ventures at roman@prestoventures.com or Linkedin.

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