Facebook’s Volatile Year in One Giant Chart

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Facebook's Volatile Year Explained in One Chart

Facebook’s Volatile Year in One Giant Chart

View the high resolution version of today’s graphic by clicking here. Facebook has found itself in the headlines a lot in 2018, but not for reasons investors are likely to be excited about. The tech giant battled privacy scandals, policy changes, and dwindling user engagement throughout the year, and in July the company made history with an overnight drop of $119 billion in market capitalization – the single largest drop in U.S. history. Today’s chart, which was done with Cambridge House for their upcoming Extraordinary Future 2018 tech conference, shows Facebook’s volatile year in perspective. Here is a recap of some of the more major events that prompted volatility so far in 2018:

Zuckerberg Sells Shares

Facebook CEO Mark Zuckerberg drew attention in September 2017 when he announced plans to systematically sell off up
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Investment Risk Tolerance By Gender

Our portfolio company Stash, which offers a super simple mobile investing app and has roughly 2.5mm users, did some analysis on male and female users to see if there was a material difference in risk tolerance between men and women on their service. The conventional wisdom is that men are risk takers and women are more conservative. Stash found that there really isn’t much difference between male and female users of their service when it comes to risk tolerance. And they found that women are more tolerant of the highs and lows that come with being an investor. Check out the data here.


USV TEAM POSTS:

Albert Wenger — September 5, 2018
Uncertainty Wednesday: A New Tack

Being Public

The back and forth that Elon Musk did over the last few weeks about being public begs the question about whether the challenges of operating a public company outweigh the benefits. Elon wrote this in a letter to Tesla’s employees:
As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term. Finally, as the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company. I fundamentally believe that we are at our best when everyone is focused on
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The SEC wants Tesla to explain Elon’s 420 tweet

Elon Musk, billionaire founder of Tesla, startled the Twittersphere yesterday by announcing he wanted to take the company private at the price of $420 per share. While some speculated the tweet was a joke or a marijuana reference, others took to the market. The tweet sent the stock soaring up 11 percent, causing a halt in trade for a portion of the day. Now, the Securities and Exchange Commission is looking into the matter.

Wall Street Journal sources say the SEC has since made inquiries to Tesla to find out whether Musk’s tweet was truthful and why he chose to announce such a move on Twitter instead of through a regulatory filing. Musk could be held legally liable if regulators determine he was intentionally trying to boost the stock price with his tweet. Musk later

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And Now A Word From Our Sponsor

I’m running an advertisement here today. I’ve been Chairman of two public companies in my career and the leaders of those two companies sat down and talked yesterday. I enjoyed watching that very much and hope you do too. In this nine-minute video, Jim Cramer talks to Josh Silverman, CEO of Etsy, about what makes Etsy “special” and how being special allows them to compete and win against Amazon. Etsy CEO on Amazon Handmade: It doesn’t really threaten our business from CNBC. Disclosure: I am the Chairman of Etsy, have been on Etsy’s board for 12 years, and my wife and I own a lot of Etsy stock.


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Albert Wenger — May 9, 2018
Uncertainty Wednesday: Beliefs (Part 3)

Is Buying Crypto Assets “Investing”

There are few investors I have more respect for than Warren Buffett and Charlie Munger. So much of what I believe as an investor has come from watching them conduct themselves over the last thirty-five years (that’s as long as I have been paying attention to investing as a discipline). I believe in fundamental value, I believe in buying when others are selling, I believe in holding positions you find attractive over very long periods of time, and I believe in a lot more that they have espoused and done. So when I read the two of them disparaging the purchase of crypto assets, it bothers me. Obviously I don’t agree with them, but I am trying to see what they are seeing and disliking. This interview that Buffett did with Yahoo! Finance is instructive. Buffet says:

“If you buy something like a farm, an apartment house, or an

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Google Finance

Google Finance and Yahoo Finance are two web services I have used daily since the early days of the Internet. I have used Yahoo Finance since it first launched in January 1997. But after Google Finance launched in 2006, I started using Google Finance more and eventually, it became my default finance site on the web. Sometime in the last month or two, I can’t remember exactly when, Google revamped Google Finance. The UI is cleaner and the service is much simpler. But a lot of the power user features I had come to rely on in my daily work are either gone or buried so deeply that I can’t find them. I also find it hard to search for a price quote now, which is kind of the most basic feature one would want in a service like this. Anyway, I have switched a lot of my usage back
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This Giant Infographic Has 140+ Facts on the Scale of Amazon

This Giant Infographic Has 140+ Facts on the Scale of Amazon

This Giant Infographic Has 140+ Facts on the Scale of Amazon

As Amazon continues its takeover of the retail sector, the scale at which it operates continues to impress. Back in late 2016 we examined the extraordinary size of Amazon from a market valuation perspective, which showed that the ecommerce giant was worth more than most brick and mortar retailers put together. Today’s infographic from 16Best continues along that same thread, except this time focusing on Amazon from more of an operational perspective.

Amazon: At a Glance

Amazon has more than 304 million users, and 3 billion products selling on their 11 marketplaces – and every day, 1.3 million new products are added. The company has a 43.5% market share of U.S. ecommerce spending. It’s no surprise then, that the average customer spends $700 per year with Amazon, and that 34.7 items are shipped every single
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Why the Spotify IPO is Both Unusual and Intriguing

Why the Spotify IPO is Both Unusual and Intriguing

Why the Spotify IPO is Both Unusual and Intriguing

The Chart of the Week is a weekly Visual Capitalist feature on Fridays. On April 3, 2018, the music streaming service Spotify is expected to hit the public markets for the first time. However, while IPOs are usually large, hype-driven spectacles that involve investment bankers and roadshows to financial institutions, the Spotify IPO is taking quite a different route. For a variety of reasons, this will make the Spotify IPO both an unusual and intriguing event for investors. Here’s what’s interesting about the impending listing of the Sweden-based unicorn.

1. A Rare Breed

Despite the tech IPO being a legendary exit strategy among startup founders and venture capitalists, the reality is that today tech IPOs are few and far between. Tech IPOs in the U.S. By the same token, IPOs are also traditionally a way for investors to get a handle on market sentiment. With fewer
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Taking Money “Off The Table”

One of the hardest things in managing a venture capital portfolio is managing your big winners. A big winner can dwarf the rest of the entire portfolio and you end up sitting on enormous paper profits that you can’t get liquid on. I realize that this seems like a great problem to have, and it is, but it is still a challenging situation. We faced it in Twitter in 2010/2011/2012, in the years before Twitter went public (which happened in the fall of 2013). We had bought 15% of Twitter for $3.75mm in the first VC round in 2007 and though we had been diluted down a bit in subsequent rounds, we had a very large position that was worth in the neighborhood of $1bn by 2011. Our entire fund was $125mm and so we were sitting on a position that was worth 8x the entire fund. It was
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Breaking Down How Amazon Makes Money

‘Tis the season for shopping. For many of us, that means buying things online – and if you are like most internet denizens, you’ll be picking up at least one item this holiday season through the the world’s largest e-commerce giant, Amazon. The company’s sales numbers are growing at a staggering pace. Last year, Amazon had $136 billion in sales, and the company is projected to finish at the $177 billion mark this year. What are the exact sources of Amazon’s revenue, and how does it all break down?

How Amazon Makes Money

Today’s infographic comes to us from Sellbrite, and it dives into the company’s success, and how Amazon makes money: Breaking Down How Amazon Makes Money To the chagrin of many investors, Amazon has traditionally spent a lot to make a little. In 2016, for example, the company brought in $136 billion in net sales, but it spent $131.8 billion on operating
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Why Tech Investors Love the SaaS Model

Why Tech Investors Love the SaaS Business Model

Why Tech Investors Love the SaaS Business Model

Investors love businesses that have a reputation for minting cash. And as far as tech companies go, the Software as a Service (SaaS) model is as good as it gets. It provides predictable, quantifiable, and fast-growing revenue for any company that can execute correctly – and everyone from venture capitalists (like Marc Andreessen) to asset managers (like Blackrock) love investing in companies with these traits. Today’s infographic from TIMIA Capital explains why this is the case.

What is SaaS?

Unlike in years past when software was bought in a physical form at a store, much of today’s software runs right off the cloud. This is made possible by ubiquitous broadband access and powerful computers – and SaaS allows users to consume software in a different way:

Most Valuable U.S. Companies Over 100 Years

The Most Valuable Companies in the U.S. Over 100 Years

The Most Valuable Companies in America Over 100 Years

How much does the business world shift in a century? Today’s visualization comes from HowMuch.net, and it uses Forbes data to show how the list of the top 10 companies in the U.S. has evolved over the last 100 years.

1917: The Industrialist Era

In 1911, both John D. Rockefeller’s Standard Oil and J.P. Morgan’s U.S. Steel (which was formed from Andrew Carnegie’s steel company and others) were facing antitrust action. Standard Oil, which controlled over 90% of all oil in the United States by 1900, got split up into 34 independent companies after a ruling by the Supreme Court. However, U.S. Steel, which controlled 67% of steel in the country, was able to weather the antitrust storm at the time. In the chart showing data for 1917, you can see that U.S. Steel
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IPOs Are Back In Favor

I read this piece on Reuters claiming that the huge megafunds in venture and growth equity are “stalling IPOs.” And while it makes sense at some level, the truth is the exact opposite. Based on everything I am seeing, hearing, and reading, 2018 and 2019 will be bumper years for tech IPOs, assuming the markets behave. Uber’s new CEO Dara Khosrowshahi has promised an IPO in 18-36 months. That says 2019 to me. Hot companies like Stitch Fix are filing to go public this year. We have a pipeline of strong mature (and increasingly profitable) companies in our portfolio that will head to the public markets in 2018 and 2019. So when you read stuff on the Internet, don’t take it as correct. The truth is often the exact opposite.


USV TEAM POSTS:

Albert Wenger — October 23, 2017
Rebecca Kaden: New Partner at USV

Numeraire Is Live

Back in February, I posted about Numeraire. I wrote:
the Numerai team has now gone a step further and issued a crypto-token called Numeraire to incent these data scientists to work together to build the best models instead of just competing with each other

And roughy four months later, I am happy to write that the Numeraire token is live on the Ethereum blockchain. You can read more about this here. Well done Numerai team.


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Albert Wenger — June 21, 2017
Uncertainty Wednesday: Random Variables Albert Wenger — June 20, 2017
MongoDB Stitch: A Fresh Take on Backend As A Service

Blue Apron will raise $587M in its IPO, valuing itself close to $3B

 Blue Apron, the meal ingredient delivery service that filed to go public earlier this month, has just priced its IPO. The company will price its shares between $15-$17, hoping to raise a maximum of $586,500,000. Using a $16 midpoint, this pricing gives the company a proposed valuation of just under $3 billion. The company will be listed on the NYSE under the symbol “APRN”, and… Read More

A Man For All Markets

I have had this book, A Man For All Markets, on my kindle for the past year. I can’t recall who recommended it, possibly my friend Jeremy, but I can’t be sure. A couple weeks ago, I had lunch with my friend Harry and he again suggested it to me. I decided to put it at the top of my to read pile (a virtual pile) and have been reading it for the past week. It’s a terrific book, nominally the life story of Edward Thorpe, the math professor, blackjack card counter, and hedge fund manager. The book is a reminder that math, particularly the highly agile mathematical mind, is a very powerful thing. But it is also full of amazing insights on risk and return, from gambling to investing. I particularly liked this observation that Edward makes after testing his “ten count” system with the the
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