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OUR SOURCE OF TRUTH ON MARKETPLACES (REPORT)

NFX report on the current state and future potential of marketplace business models.

METICULATE

Laser-focused B2B prospect lists in minutes.

WHALESYNC

Control your apps from a spreadsheet.

4 YEARS, €2M, AND A GREEN DREAM

Grünfin, a sustainable investment platform that sought to make values-based ETF investing accessible, has closed after four years due to challenges in scaling and overcoming misconceptions about sustainable investing. Despite delivering positive portfolio growth for nearly all customers and receiving significant venture funding, the startup struggled with market reluctance, timing, and trust barriers, underscoring the difficulties faced by mission-driven startups in uncertain economic climates.

THE ANTI-SHACKLETON MANIFESTO

In business today, trying to keep everything going like Shackleton did is a bad idea. Leaders need to be good at regularly figuring out what parts of the company aren't working and getting rid of them. They should move fast, cut things in a smart order, and be super clear with their team. This helps them deal with change and come out better. The new leadership motto is to stop doing what others keep doing and grow by ending stuff on purpose.

THE ULTIMATE GUIDE TO NAVIGATING THE VC INVESTMENT FUNNEL

The VC investment funnel is the step-by-step way VCs find, check out, and put money into promising startups. It has six main parts: finding deals, picking the good ones, double checking everything, deciding to invest, helping the startups grow, and eventually selling their part of the company. Knowing how each step works helps startup founders make their companies look better to investors and helps investors make smart choices. The funnel starts with a lot of possible investments but narrows down to just a few in the end. Out of 100 leads, about 20-30 make it to the first review step, 10-15 of those get looked at really closely, and 5-10 end up getting money.

WHAT PERCENT OF STARTUPS MAKE THE LEAP FROM SEED TO SERIES A?

Approximately 50% of startups transition from Seed to Series A funding, highlighting the challenges of securing further investment.

THE EXECUTION TRIANGLE

When doing any kind of project, there are three main things: what you want to get done, what you need to do to get it done, and how long you have.

5 INTERESTING LEARNINGS FROM TWILIO AT $4.5 BILLION IN ARR

Twilio has experienced a significant turnaround, with growth re-accelerating to over 10% and its stock up 51% this year.

BUILDING MOATS IN AI

In this post, Carles Reina of ElevenLabs discusses the company's strategic approach, emphasizing its dual focus on research and application to create a competitive moat. He highlights the importance of moving upmarket to cater to enterprise customers and the evolving landscape where non-tech companies are increasingly adopting AI solutions. Reina also underscores the significance of building a strong community and ecosystem, leveraging both product-led and sales-led growth strategies to ensure long-term success.

COOKING THE BOOKS

A recent incident at Macy's highlights concerns about trust and internal controls after a single accountant manipulated accounting entries to reduce expenses by $150 million over three years. This act of financial statement fraud involved hiding expenses in the accounts payable and accrued liabilities, significantly impacting reported net income and key metrics for investors. The case underscores the necessity of robust internal controls and vigilant oversight to prevent such deceptive practices.

THE SURPRISING STATE OF SAAS

SaaS spending rebounded by 9% in 2024, with smaller companies (under 500 employees) leading a 59% increase, focusing on tech investments for efficiency and employee satisfaction. The growth benchmark for SaaS companies with over $50 million in ARR has shifted to a more attainable 25% year-over-year rate. Vertical SaaS companies are outperforming horizontal ones due to their industry-specific focus. Pursuing larger deals, despite higher risks, can enhance growth and retention.

NEXT-LEVEL PRODUCT PAGES

AI technology is revolutionizing e-commerce by simplifying the creation of detailed, engaging product pages, which can significantly enhance user experience and boost sales. Businesses can continuously optimize their content to better meet customer needs while improving SEO rankings by leveraging AI for tasks like A/B testing and personalization. However, it's essential to balance AI-driven experimentation with maintaining a consistent brand identity to ensure a cohesive user experience.

5 STEPS TO ESTABLISH A CLEAR POV

A clear point of view (POV) is crucial for B2B companies to differentiate themselves, build trust, and drive growth. Establishing a strong POV involves diagnosing current issues, framing the problem from the customer's perspective, identifying challenges, stating a purpose, illustrating success scenarios, and creating an inspiring manifesto. Regular refinement of a company's POV is essential to maintain relevance and impact in evolving markets.

DESIGN LITERACY IN THE AGE OF INTELLIGENT AUTOMATION

In a world increasingly dominated by AI and automation, design is evolving from a specialized profession into a universal mindset that combines strategic thinking with creative execution. This transformation emphasizes the importance of human elements like vision, curation, and conviction in creating meaningful products and experiences. As AI democratizes creation and technical skills, success will depend more on design literacy - the ability to understand what to build and why it matters, rather than just how to build it.

Start here

FACEBOOK'S LITTLE RED BOOK (BOOK)

In 2012, Facebook tackled the challenge of maintaining a cohesive company culture amid rapid growth by creating a "Little Red Book," a manifesto encapsulating its core ethos. A high-quality digital scan of this rare book has now been made publicly available.

ALL-IN-ONE FUNDRAISING RESOURCES (RESOURCE)

Curated resource guide for founders navigating the fundraising process.

SPC'S REQUEST FOR CURIOSITY (FELLOWSHIP)

Which questions does South Park Commons want to see more of in 2025?

LESSONS FROM MY 3 MOST CHALLENGED INVESTMENTS

Early-stage investing is inherently risky. This post looks at three portfolio companies that faced significant challenges despite strong initial prospects and hardworking founders. It discusses the importance of proper funding rounds, co-founder relationships, and maintaining adequate cash reserves. Even promising startups with strong growth can fail due to factors like market conditions, customer churn, or internal conflicts.

WHY IS GOOGLE LOSING MARKET SHARE IN THE EU?

Google's search market share has been declining in several European Union countries, particularly noticeable since 2018 and accelerating after April 2024. This decline is primarily driven by privacy regulations, choice screens for browsers and search engines on mobile devices, and growing competition from alternatives like Bing and privacy-focused search engines. While Google's revenue continues to grow despite the market share losses, the trend signals a potential shift toward a more fragmented search engine landscape, with Bing emerging as the primary beneficiary of Google's declining dominance.

IT'S NOT WHAT I THOUGHT THAT MAKES A COMPANY GROW

Startups achieve rapid growth through a combination of tools, frameworks, and most importantly, a growth-oriented culture. Successful startups have cultures that emphasize setting (un)achievable goals, maintaining speed, using a common language focused on key metrics, and prioritizing growth above all else, even at the risk of burnout. However, such exponential growth is not sustainable in the long term, and companies must eventually pivot towards a more stable business model.

THE YEAR ALGORITHMS LEARN TO ACT

In the evolving landscape of AI, the focus is shifting from passive systems that merely respond to queries to more proactive AI agents capable of taking action.

WISHES

Initiatives for boosting U.S. entrepreneurship could include establishing a startup founder visa, allowing H1B visa holders to start businesses, and abolishing federal non-compete agreements.

THREE FUTURE STATES OF THE EARLY-STAGE VC ECOSYSTEM

The venture capital landscape is facing a transformative period with three potential futures: a return to traditional dynamics, a market split between small and large funds based on exit size targets, or the dominance of multi-stage funds in seed investing.

BIG TECH STRENGTH

A brief analysis of market trends shows that while software stocks remained relatively flat this week, most of the "Magnificent Seven" tech companies saw positive gains, with only Nvidia and Tesla experiencing declines. The market dynamics continue to demonstrate that software companies are primarily valued based on revenue multiples, with the overall median multiple at 6.2x and varying significantly based on growth rates: high-growth companies command 10.1x, mid-growth 11.3x, and low-growth 4.7x multiples.

MICROSTRATEGY'S $37B+ BITCOIN BET

MicroStrategy, a publicly listed software company, has pivoted to focus heavily on Bitcoin (BTC), holding approximately $37B worth of the cryptocurrency. This shift began in 2020 when CEO Michael Saylor decided to convert MicroStrategy's cash reserves into Bitcoin, driven by concerns about inflation and currency devaluation. The company now offers Bitcoin-linked financial products, such as convertible bond notes, which cater to different investment appetites and capitalize on the demand for Bitcoin exposure without the need for direct crypto investments.

BLACK FRIDAY HITS A RECORD $74.4B IN SALES ONLINE

WHY YOU NEED A COMPETITOR COMPARISON LANDING PAGE

NEVER OVERTHINK

This post recommends seven concepts for reducing overthinking and living a better life: practice morning pages to clear the mind, use the 5 Second Rule to overcome hesitation, embrace imperfection with the 70-20-10 Rule, recognize the spotlight effect to reduce self-consciousness, ask powerful questions to break mental loops, adopt cosmic insignificance therapy for perspective, and use meditation for presence. These strategies can help decrease stress, enhance productivity, and encourage bold actions, ultimately fostering personal growth and fulfillment.

CROSSING 8 FIGURES IN ARR BY OPERATING LIKE A BOOTSTRAPPED PRODUCT

Streak, a Gmail-based CRM, grew to over $10M a year in revenue by focusing on small, powerful teams, staying profitable, and learning to say no to things like low-value customers and splashy marketing. In this post, founder Aleem Mawani shares the challenges of scaling thoughtfully, from pivoting during YC to navigating growth phases fueled by word of mouth and clever distribution hacks like the Chrome Webstore.

KROTO

Record and translate video guides in over 60 languages with AI.

TABS

Revenue automation for B2B companies.

POSTIZ

Schedule posts, analyze performance, and manage all accounts in one place.

WHAT METRICS DO THE TOP SECURITY COMPANIES REPORT ON?

Leading cybersecurity and observability companies universally report on Revenue and Non-GAAP Operating Income metrics, with most also providing guidance on Free Cash Flow and customer-related metrics. Companies show varying preferences between Calculated Billings and Annual Recurring Revenue (ARR) reporting, with ARR emerging as a better indicator of business trajectory. The current market shows stable valuations, with median EV/NTM Revenue multiples at 16.4x. Companies are demonstrating strong efficiency metrics with a median Rule of 40 at 53%.

NVIDIA: PAST, PRESENT, AND FUTURE

Nvidia, founded by Jensen Huang 30 years ago, rose from among nearly 100 graphics card companies to become a dominant force in high-performance computing through its GPU technology. By advancing general-purpose computing with CUDA and capitalizing on AI trends, Nvidia has positioned itself as a leading AI infrastructure provider, growing significantly with the rise of deep learning and AI applications. Despite facing challenges such as competition and geopolitical risks, Nvidia continues to innovate and expand its offerings in hardware and AI software, maintaining its status as a pivotal player in the tech industry.

SEARCHING FOR INSIGHT

In the world of professional expertise and analysis, many roles serve more as a theatrical backdrop than genuine drivers of change. This reality spans across think tanks, sports journalism, and data analytics, where the work often exists primarily to legitimize the handful of influential voices at the top. The mounting pressure from AI adoption may not stem from machines being superior at these jobs, but rather from the revelation that much of this work was primarily serving as convincing window dressing all along.

WHY ENTRY PRICE MATTERS

This post explains an investment philosophy that requires each portfolio company to have the potential for a 70x return.

STARTUPS HAVE RAISED 17% MORE CAPITAL IN 2024 THAN 2023

In 2024, startups on Carta experienced a 17% increase in capital raised compared to 2023, with significant disparities across funding stages.

SHORTEST TIME TO IPO?

A software company achieved unprecedented success in 1983 by reaching $50M in revenue and IPOing in its first year - far shorter than today's average 13.6-year journey to public markets.

BEAUTY IS IN THE ALGORITHM OF THE BEHOLDER

The evolution of beauty standards throughout history has been closely tied to economic accessibility and social status, with desired traits often shifting once they become widely attainable. As GLP-1 medications like Ozempic become more affordable and accessible, this could trigger another significant shift in beauty ideals, similar to historical examples like the European spice trade. This trend, combined with modern technological advances in cosmetic procedures and AI-powered image editing, suggests we're entering a new era where traditional markers of beauty and status may fundamentally change.

DEFENSIBILITY: POWER WITHIN THE AI STACK

The market dynamics of the AI technology stack are being shaped by factors like compute hardware requirements, foundation model development, and infrastructure needs. Large tech companies and cloud providers dominate the data center compute market, while local inference capabilities are becoming increasingly important for both consumer devices and embedded systems. The economics of foundation models present unique challenges, with massive capital requirements for development but rapid depreciation of value as newer, more capable models emerge.

AMERICA'S SUPERPOWER

Americans should be thankful for their country's electoral system, which embodies the concept of "optionality," allowing citizens the ability to change the nation's direction every four years. This system prevents the stagnation seen in countries with one-party rule, such as Argentina and China, by enabling vibrant democracies to adapt and self-correct, ultimately fostering economic resilience and global alliances. Despite the tensions and divisions that tight elections can cause, they are crucial for maintaining the flexibility and dynamism that underpin American democracy.

WHY YOUR SELF-SERVE MOTION SUCKS

Companies often face a disconnect between their successful sales-led enterprise deals and underperforming self-serve motions. This disparity typically stems from attracting the wrong customers, ineffective self-serve experiences, or misaligned pricing and packaging for lower-end market customers. Addressing these issues requires aligning self-serve acquisition with enterprise success patterns, embedding sales tactics into the product experience, and optimizing pricing structures to reflect value across all customer segments.

HOW LUME USES BUYER PSYCHOLOGY

Overcoming the challenge of finding an effective natural deodorant, Lumē's success story shows how understanding consumer pain points and leveraging buyer psychology can transform a product into a must-have solution. Developed by Dr. Shannon Klingman, Lumē addresses body odor by neutralizing odor-causing bacteria without using baking soda. The company utilizes authority bias, labor illusion, humor, and strategic framing to effectively market its benefits. This has led to a rapid acquisition by Harry's in just four years.

WHY CANDIDATE ASSIGNMENTS ARE THE BEST ASSESSMENT TOOL

Interviews, resumes, and references are okay for assessing candidate characteristics but terrible at evaluating abilities. Assignments that simulate real work constraints are the best way to test skills, critical thinking, and process. Great assignments aren't free consulting, but rather a chance for both sides to assess fit. The key is designing assignments that test the right things while respecting candidate time. While this may cause some potential candidates to drop out, the tradeoff of a smaller but better-suited pool is worth it.