According to his retelling of the story on Re/code Decode, after struggling to accomplish anything meaningful in his first year on the job, he was on the verge of being fired.This idea not only saved him his job, but earned him the lionshare of the credit for Facebook s unprecedented growth.At the time, Sheryl and Mark asked him, What do you call this thing where you help change the product, do some SEO and SEM, and algorithmically do this or that?Four Ways Software Changed How Companies GrowThere have been four major market changes caused by the proliferation of software that have changed our approach to growing products.The Emergence of Platforms and APIsEvery company is built on top of a larger pre-existing platform.Mixpanel, Amplitude, Segment, KISSmetrics, Localytics -he list goes on and on.
Great share Justin.I kind of like Chamath Palihapitiya's advice on following core experience.I wonder if the aha moments or rules are similar to the statistical probabilities of games like Black Jack e.g.dealer turns a 10 you have 40% chance of winning.Dealer turns a 6 and it's 20%.
In a competition of egos, too many startups went after that $1 billion mark without businesses to back it up.However, the investors who used to fund these excessive growth rounds for fear of missing out have started "sobering up" to realize they've invested in some bad business models at some huge Capital's Chamath Palihapitiya told Business Insider.
When Social Capital partner Chamath Palihapitiya woke up to the news the Microsoft bought LinkedIn for $26 billion, he was stunned.And it wasn't just because of the price tag."One, that s immense courage by Microsoft to basically put themselves out there," Palihapitiya told Business Insider."Two, that s a really courageous thing for Jeff Weiner, LinkedIn's CEO and Reid Hoffman, LinkedIn's founder to basically decide that they could do more for their employees by giving them a buffer and safe harbor of being a part of the Microsoft family."Palihapitiya had watched as LinkedIn's stock "collapsed on basically air" in February, falling 43.6% in one day and shaving off $11 billion from its market value.Its public investors showed "tremendous fickleness," in his opinion.
On Monday, the Golden State Warriors stunned the NBA by picking up star player Kevin Durant from the Oklahoma City Thunder, who almost beat the Warriors in the semi-finals.Chamath Palihapitiya, one of the better-known venture capitalists in Silicon Valley, is a minority owner of the Warriors and an exec in the team's
This editor has spied many an investor milling about during different visits, including Bryan Schreier of Sequoia Capital, Mike Abbott of Kleiner Perkins Caufield & Byers, and Brian O Malley of Accel.That extends to their limited partners like us , general partners at other venture firms, and entrepreneurs.Certainly, Pear appears to think differently, which can perhaps be traced to its unusual roots.As it happens, it was through Danger that Nozad met Hershenson, a three-time entrepreneur whose husband cofounded the company.Unlike other venture outfits that orchestrate expensive dinners with journalists, for example, Pear organizes events at its offices for cash-strapped founders and students that feature VCs and renowned CEOs as speakers.Past guests include John Doerr of Kleiner Perkins, Yahoo cofounder Jerry Yang, investor Chamath Palihapitiya of Social Capital, and Zynga founder Mark Pincus — though Nozad says a more popular attraction is a life coach who comes regularly to help founders with their personal problems.
Chamath Palihapitiya has a plan to save Twitter: Make it a little bit more like Reddit.Palihapitiya, the principal of venture capital firm Social Capital is one of Silicon Valley's most outspoken investors, and he did not disappoint on stage on Wednesday at Vanity Fair's New Establishment Summit in San Francisco.Vanity Fair's Nick Bilton asked the panelists, who also included Box CEO Aaron Levie and Kleiner Perkins partner Mary Meeker, what they'd do if they were asked today to take over Twitter for Jack Dorsey.Palihapitiya had a three-part plan:Reduce the cost basis, which he said "makes no sense" and limits the company's ability to innovate.Palihapitiya said Twitter spends about one-third as much money as Facebook does on operating the service, even though it has about one-sixth as many users about 300 million per month to Facebook's approximately 1.7 billion , and limits the length of posts to 140 characters.When Levie suggested it was crazy that Twitter hadn't been able to address its problems with trolling and abuse of users, Palihapitiya said, "The product is technically broken."Figure out the product vision.Palihapitiya said that Twitter shows there's a demand for something between Facebook and Reddit, where some content in the news feed is chosen algorithmically like Facebook , but you can dive deeper into particular subjects if you want to like Reddit .He thinks Twitter needs to do a better job enabling the deep-dive part.
In case you still think Amazon is still predominantly an ecommerce site, here's something that'll change that.According to Deutsche Bank, Amazon's cloud business, Amazon Web Services, has become so big that some people think it is subsidizing the company's retail operations.It wrote in a note Thursday:"One AWS rival, making the point that the cloud infrastructure business has proven to be far more profitable than everyone thought, argued that the margin story at Amazon has now flipped, such that 'AWS is now underwriting Amazon s war on Walmart.'"In fact, AWS is now the most profitable and fastest-growing business at Amazon.AWS had $3.2 billion in revenue last quarter, only a fraction of the $29 billion Amazon's retail business generated in the same period.But it saw far higher margins, with about $1 billion in operating income, compared to Amazon retail's $360 million.On top of that, AWS is still seeing a whopping 55% year-over-year growth rate, which means it still has a lot of room to grow and will likely continue to be a crazy profit-generating machine for a while.In other words, Amazon can keep pumping AWS's profits into its retail business, a market known for notoriously thin margins and intense competition.The irony is, AWS began its life as a way for Amazon to make extra money on the huge infrastructure it had built as a way to support its retail operations.Amazon TaxThis isn't the first time the investment community talked about this.Social Capital's VC investor Chamath Palihapitiya went so far as to say he would bet his entire capital on Amazon if he had to choose one company precisely because of this dynamic."The reason I think this has nothing to do with e-commerce, although e-commerce is their way of dog fooding the real reason: AWS," he said in a Quora Q session earlier this year.Palihapitiya even compared AWS to a "tax"because it's so widely used by every company that it'll eventually turn into a fixed annual cost for most businesses.
Investors want into esports, and now they are betting on one of professional gaming’s biggest teams.Cloud9 has closed out a Series A funding round for an undisclosed amount of money.The organization owns and operates some of the top pro teams in games like League of Legends, Counter-Strike, and Hearthstone, and it wants to expand its presence in the esports market that analysts predict will grow 41 percent to $696 million this year.FunPlus Ventures led the funding.Cloud9 plans to use this influx of cash as well as its partnership with its new investors to build larger sponsorship deals in the future.The series A round also saw participation from a plethora of major names in game developer.Those include San Francisco Giants outfielder Hunter Pence, Signia Venture Partners cofounder Rick Thompson, Founders Fund cofounder Ken Howery and partner Brian Singerman, Reddit cofounder Alexis Ohanian, Bonfire Studios cofounders Min Kim and Rob Pardo, Jam City cofounder Josh Yugado, L.A. Dodgers co-owner Todd Boehly, United Talent Agency, Hall of Fame San Francisco 49ers QB Joe Montana, NBA star Andrew Bogut, Golden State Warriors co-owner Chamath Palihapitiya, and Tesla board director Antonio Gracias, Kimbal Musk, and Bill Lee.“We’ve formed a fantastic group of investors to help push Cloud9 to the next level,” Cloud9 chief executive officer Jack Etienne said in a statement.“With this investment you can expect Cloud9 to continue our expansion into the esports market while maintaining an exceptional experience for our players.”In his own statement, Reddit’s Ohanian said that investing in esports was a chance to live out a childhood fantasy of owning an NFL team.
In a recent episode of HBO’s Silicon Valley, Richard, the show’s protagonist startup founder, and Monica, one of his investors, stroll through the aisles of a bountiful grocery store that looks not unlike Whole Foods.Wall Street investors, spooked by the shadow of CEO Jeff Bezos, sent the stock prices for traditional retail chains—Walmart, Krogers, Target—tumbling down.Venture capitalist Chamath Palihapitiya predicted this kind of land grab, or something like it, a couple of years ago, at an investment conference, when he called Amazon the most incredible company in the world: "We believe there is a multi-trillion dollar monopoly hiding in plain sight," he said.For amateur observers, Amazon acquiring Whole Foods was the first glimpse of how that monopoly might take shape.In groceries, no less, a staple everyone needs?The move certainly seemed tectonic to delivery startups like Instacart, whose value depends on being better than Amazon at delivering perishable goods the "last mile" to a consumers door: in a statement to reporters, the company said, “Amazon just declared war on every supermarket and corner store in America."
No one picks up the phone and everyone gets too much email.If you want to contact people for fundraising, a political campaign or marketing, texting is the way to go.The potential to revolutionize both grassroots activism and corporate sales has won Hustle a new $8 million Series A led by existing investor Social Capital, whose founder Chamath Palihapitiya sits on Hustle’s board.That brings Hustle to over $11 million in funding to take the lessons it learned as Bernie Sanders’ texting tool for the 2016 presidential election and bring it to all kinds of organizations.In 2014, Lindsay hooked up with former Obama ’08 Nevada new media director Perry Rosenstein to form Hustle.Organizers build a phone number database, and write script templates on Hustle’s desktop app for the messages they want to send out.
Mamoon Hamid, a longtime partner at U.S. Venture Partners who went on to co-found Social Capital with Chamath Palihapitiya in 2011, is moving on to Kleiner Perkins Caufield & Byers.According to Axios, and confirmed by Social Capital, Hamid will focus on early-stage tech investments, with a focus on enterprise software.But Palihapitiya calls it “a great opportunity for Mamoon” and says that “we’re happy for him and Kleiner Perkins.”He adds that Social Capital is “building a platform where people with potential can come, build a track record, do great and then try new things.”The move is interesting for a wide variety of reasons, including, obviously, that Hamid isn’t simply a managing director with Social Capital.It isn’t every day that a venture firm co-founder breaks off to join someone else’s firm.
A group of Silicon Valley entrepreneurs plans to launch an investment vehicle that will offer a richly valued technology startup an alternative route to public ownership.The group, led by Chamath Palihapitiya, chief executive of venture-capital firm Social Capital, plans to raise at least $500 million from public investors, according to a Securities and Exchange Commission filing Wednesday.The team is planning to meet with investors during the second week of September and launch the offering on the New York Stock Exchange in mid-September, people familiar with the matter said.A number of tech entrepreneurs have grown wary of public ownership in recent years—because of the increased scrutiny it brings and what they view as the stock market’s short-term orientation—and have been able to avoid it because private funding sources have proliferated.Snap Inc. illustrates the perils of the traditional IPO in some entrepreneurs’ eyes—even though it is still very early in its life as a public company.The Snapchat parent made its debut in March and after an initial burst of investor enthusiasm the shares have sagged as competitive pressure ratchets up.
Midas-touch investor Chamath Palihapitiya is launching a public company that will raise money through an IPO and then figure out what tech companies to buy.He's trying to raise $500 million to be spent on well-performing private tech startups.He's enlisted other famous tech executives to help him run the fund, including former Skype CEO Tony Bates and former Twitter COO Adam Bain.Chamath Palihapitiya, founder of VC firm Social Capital, is setting himself up to become the Warren Buffett of tech investing.To that end, he has launched a new "blank-check" company in partnership with London-based VC firm Hedosophia, aptly named Social Capital Hedosophia Holdings Corp.Social Capital Hedosophia has filed paperwork for a $500 million IPO although it makes no products, has no customers, and owns nothing ... yet.
A new investment vehicle run by venture capitalist Chamath Palihapitiya raised a higher-than-expected $600 million from investors Wednesday night in an offering designed to help tech entrepreneurs circumvent the initial public offering process.Mr. Palihapitiya, who will serve as chief executive of the new vehicle, and his co-founders call the vehicle and its implications for public offerings “IPO 2.0.” The firm, Social Capital Hedosophia Holdings Corp. IPOA.U 3.10% , started trading on the New York Stock Exchange on Thursday.One of his criticisms: A traditional underwriting consists of using multiple banks to execute an IPO.These four to five banks, Mr. Palihapitiya said, are all working to give preference to their own clients, the potential investors, on both the price of the deal and how many shares they receive in “ways that have no material advantage to the company,” he said.Social Capital Hedosophia worked with Credit Suisse Group AG as its sole underwriter and helped choose the mix of 20 investors that received about 90% of the IPO shares, people familiar with the process said.While tech entrepreneurs with growing business have a profusion of options for raising capital in private markets, he says private capital hurts the businesses longer term because employees, who have suboptimal ways to sell their own shares privately, tend to leave private tech companies more frequently, fueling high turnover rates.
Silicon Valley venture firm Social Capital just completed the first step in its mission to take startups public without an IPO.The team has listed something called a special purchase acquisition company, known as a SPAC.More common outside of the tech industry, these blank-check companies are specifically designed to buy private companies and bring them public without going through the IPO process.Social Capital has raised $600 million for this holding company named Hedosophia, which will be used to buy a stake in a yet-to-be-decided-on startup.Social Capital CEO Chamath Palihapitiya says it will have a market cap between $3 billion and $20 billion.Former Twitter COO Adam Bain is also on the board for the project.
Chamath Palihapitiya, an early Facebook executive and outspoken presence in Silicon Valley, is unapologetic about his frustrations with the venture-capital industry.Founded in 2011 to back early-stage startups, Social Capital now manages $1.8 billion worth of assets.“I want to fucking dominate this industry,” he says, punctuating each word with a table pound.Co-founder Mamoon Hamid abruptly left last month to join Kleiner Perkins Caufield & Byers.The firm has deployed around two-thirds of its $600 million, third early-stage fund, raised in 2015, according to a person familiar with the situation.Maidenberg plans to keep all of his board seats and continue to work with existing portfolio companies.
Chamath Palihapitiya: Right, so let's talk about growth.Everyone asks me because this is like the topic du jour, it's what everyone wants to know, it's like what was a secret, it's like almost as if like you know we're the NSA and we've like developed something, and like nobody knows or like you know some secret backroom negotiation between us and governments.And it's like none of that shit!We did three real the obvious brain-dead things and the reality was, we lacked enough self-awareness and ego to frankly just continue to do these very simple things over and over and over again repetitively, monotonously, to a point where every time we used to see things move in one direction or another we would either keep doing them or stop doing them and not second-guess ourselves.And so I kind of tell people you know look we actually just looked at a lot of data, we measured a lot of stuff, we tested a lot of stuff and we tried a lot of stuff.Now that masks over a lot of more nuanced understanding but at an extremely high level that's really what we did.
Last month, for example, Palihapitiya’s firm, Social Capital, took the unusual step of raising $600 million in an IPO for a SPAC called Social Capital Hedosophia.Entrepreneurs from anywhere in the world can fill out a questionnaire, then submit to Social Capital revenue figures and either raw engagement or transaction logs (or both), including sometimes by granting the firm direct access to the cloud services they use.How can Social Capital possibly know how to improve a company’s business model when it hasn’t even met its founders?Now, we can see a business in Africa or South America or Southeast Asia … and algorithmically fund them at hyperspeed.”Certainly the founders it has funded through the still-in-beta program think it’s a great initiative, and there have been a few dozen to date.She co-founded and was CEO of Carmudi, one of Latin America’s biggest auto classifieds sites.
David Lee, who retired from the world of basketball just last week, is in talks to join venture firm Social Capital, Axios reports.Social Capital, founded by minority Warriors owner Chamath Palihapitiya, has backed companies like Box, Slack, Treehouse and others.Lee, who most recently played for the Golden State Warriors, would join the likes of Andre Iguodala, Steph Curry, Magic Johnson and Carmelo Anthony — current and former basketball players who have joined the world of venture capital.Social Capital declined to comment for this story.Featured Image: Photo by Noah Graham/NBAE via Getty Images/Getty Images
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