💰 Top 4 Curated VC Picks + Must-Read Top 3 Books for 15Nov2023
🗒️ Was WeWork’s Problem Too Much Money?
Builtin: Once worth $47 billion, WeWork filed for Chapter 11 bankruptcy protection on Nov. 6. What happened to this startup darling whose story turned into a Netflix series titled WeCrashed?
Many bad decisions led to this moment. In our recently released book, Start. Scale. Exit. Repeat., we refer to a syndrome we coined: Silicon Valley Disease.
WHAT IS SILICON VALLEY DISEASE?
Silicon Valley Disease strikes when a company raises too much money and fails to operate a lean or efficient startup to pursue a goal of growth at all costs.
First, let me state that Silicon Valley and the venture capital groups behind it have created more successful startups than any other vehicle in history. I applaud the risk-taking and innovation that come from those involved in that community.
However, among all the glamor and success lies a heap of carnage on the Silicon Valley highway. We live in a unicorn nation where many founders believe less than $1 billion doesn’t cut it anymore. We celebrate the few that achieve this status and fail to look at the downside of venture capital. As many as 75 percent of all venture-backed companies fail and fewer than 1 percent of companies get venture funding.
🗒️ Inside a bankruptcy committee’s ongoing investigation into the failure of Silicon Valley Bank
Fortune: It’s been more than seven months since the Federal Reserve shut down Silicon Valley Bank and orchestrated its sale to First Citizens Bank out of North Carolina. And since then, a small committee has been hard at work trying to uncover exactly what happened.
Long after the Federal Reserve published its initial report in April, detailing failures of senior management and SVB’s board of directors, a small committee that is representing shareholders of SVB’s former parent, SVB Financial Group, in its ongoing bankruptcy proceedings has for months been hunting down any records and communication from SVB executives, consultants, and vendors who may have relevant information, according to hundreds of bankruptcy documents filed this year and reviewed by Fortune.
🗒️ Startup Valuations Take a Hit as Investors Demand Profitability: Austin’s Evolving VC Landscape and Entrepreneurship Realities
SILICONHILLS: Startups’ Valuations are down, and entrepreneurs must do more with less money and focus on their core business to become profitable.
The days of startups valued at 20 times revenue are over, and now, it’s more common to have five-, six– or seven-times revenue as a valuation, according to Mike Dodd, general partner of Silverton Partners.
He spoke on a panel during Austin Startup Week’s discussion on “The Shift of the VC Fundraising Landscape: What This Means for Texas Entrepreneurs” Wednesday morning at Capital Factory. Charlie Plauche, general partner of S3 Ventures, moderated the panel, which also included Venu Shamapant, founding partner of LiveOak Venture Partners, Kerry Rupp, general partner of True Wealth Ventures, and Tom Ball, Cofounder and managing partner of Next Coast Ventures.
🗒️ IBM debuts $500 million enterprise AI venture fund
Axios: IBM is dedicating $500 million to invest in generative AI startups focused on business customers.
Why it matters: IBM is the latest tech giant to jump into the AI investing race with a bright sign advertising that its VC arm is open for business.
What they're saying: "If you look at IBM over the last three years, we're a dramatically different company that we were three years ago," Rob Thomas, IBM senior vice president of software and chief commercial officer, told Axios, when asked why the company is announcing an allocation to investing in AI startups.
Top 3 book summaries this week 📚
The MicroScript Rules by Bill Schley
It’s rare that a book title says it all, but if there was ever a book to do it, it’s this one.The Micro-Script Rules: It's not what people hear. It's what they repeat. Learn how to get people to repeat your message in this summary.
The Design of Business by Roger Martin
How do you design a business, you ask? That's a great question, and Roger Martin (the former Dean of the Rotman School of Business) has the answers. The most successful businesses, Martin argues, are incredibly adept at both imagining a new future and them doing what’s necessary to make it happen.
Work Rules by Laszlo Bock
Laszlo Bock, the former head of People at Google, has a simple message for us.Work - the thing we spend more time doing than anything else in our life - doesn't have to be demotivating and dehumanizing. In this book he walks us through exactly how Google creates a world class work culture.