Category: Startups

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Preparedness Startups

Day 1419 and Know A Guy

Running a startup, for all its supposed glamour, is mostly an exercise in learning how little you know.

Sure there are playbooks for some of what you will do. As the technology industry has grown and startups have become an appealing career choice we’ve filled out how-to guides for everything from fundraising to operations.

Alas all advice is specific to the giver’s experience and untangling biases to make advice relevant to your specific needs is quite hard. That’s where it helps to have more experienced operators on hand to call bullshit.

At chaotic.capital we pride ourselves on being investors who “have a guy” for even the most esoteric possible requests. Playbooks can only you so far when you need an expert.

Just in the last two days we’ve worked through how one hires a chief of staff, what to do when letting go of counsel who made a mistake, installing appropriate security procedures for digital footprints, and the resale brokers for a rare commodity.

We like to problem solve and the weirder the problem the more fun it can be. Removing obstacles and clearing bottlenecks is satisfying work. And knowing guy who knows a guy is a heck of a fun game of social geography.

Categories
Politics Startups

Day 1413 and Much to Consider

It’s a nice number for today’s post. A strange countdown inside one day. A little spooky. Maybe also some good luck. Fourteen. Thirteen.

I am tabulating much more than my days of writing in a row or any particular numerical significance that this position of numerals might show. I’m adding up our position and deciding how to play our hand.

There is simply so much to consider. I feel it in my joints. Maybe that is evidence of acceleration. All I see and hear is speeding up. Are you accelerating anon? Maybe that’s the pressure in my joints and it’s arthritis at all.

I have felt a bit sick to my stomach and I’d prefer to blame it on delicate lady things. It could also be nausea from the spin cycle of all that “much to consider” of the moment.

I’m glad I’m ensconced in my winter farmhouse. The numbers go up. The game’s whirlwind spins. There is much to consider.

It really ruins your appetite this whirling. The ride up the rollercoaster. No wonder Alice in Wonderland commercialized into whirling teacups at Disneyland. Can’t have it be the symbolism of opinion and fuzzy opinions.

So there is much to consider as we whirl like dervishes into the next moment.

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Emotional Work Startups

Day 1398 and Overstimulated Nerds

Introverts don’t do well with social overstimulation. Any time I attend a gathering where the majority demographic is nerdy, weird, and autistic I find myself feeling the collective vibes of the overstimulated. And it’s not always good vibes for many of them.

I am doing everything I can to take care of myself, be kind to others and still be gently socializing. But it’s not easy.

I’m exhausted from the effort, even with my attempts to practice productive habits like nervous system exercises and getting adequate sleep. No amount of supplements can fend off a collective sense of fear.

I always notice what a rude demographic we introverts can be in these circumstances. Everyone is doing their best to be present and do delicate dances of parasociality where you know each other from the internet but do not wish to intrude or interrupt someone doing business.

In the cases where you are socializing with friends in real life and the rest of a group “knows of” but doesn’t know actually someone you find yourself surrounded by defensive social postures. Plus-ones with little contribute make it even worse.

And I’m not even going to touch the social dynamics of status. Insecurity seems to run rampant in all human groups, but nerds who have known social precariousness are the worst offenders in these situations.

Fear over one’s place within a group that has a wide variance in status can be intense. I don’t like seeing anyone feel left out. I like to be welcoming to everyone I encounter. Even when I’m an overstimulated introvert.

It’s especially important to me to be nice when it’s a group where the capital that provides status (social, literal) rises to celebrity or billionaire.

It can feel paralyzing to interact with anyone who has some degree of status if you don’t want to make someone uncomfortable. The awareness of social graces isn’t always enough.

It’s just as likely that someone will put on airs and over estimate their status as they are to offend the actually important guests.

I dislike watching people police their own social status but it’s even worse when someone polices the status of their friends. It creates cliques and ostracism in the best cases. Cutting off access can help when someone is just an overstimulated introvert but in practice makes the entire environment more fearful.

These social fears can really gum up the works when it’s nerds concerned over their own place within an event let alone in society.

I feel pity in the most awkward of cases but it’s really born of sadness. Cool is a bit like grace. We do little to deserve its bounty, grasping at it only shows our hubris and it doesn’t work in any case. I wonder if that’s a heretical opinion.

Categories
Internet Culture Startups

Day 1394 and Wiped

I’ve had a great year. I’m having a great month. I had a great week. I’m absolutely obsessed with my portfolio and the founders in it. Every new opportunity makes me feel better about the future.

And I’m so tired from processing all of that that it’s little wonder my body is grinding out hours of REM sleep a night.

I’m in the middle of a tight circle of artificial intelligence memetics thinkers which has been enthralling. Machine minds needing machine money has been such a pat truism that when a genuine breakthrough shows up it’s easy to focus on the wrong thing. It’s not about memecoins. I almost feel as if I’ve been preparing for this moment my entire life.

In the middle of this virtual drama I am trying to remain focused on human concerns. Repairing boots. Doing chores. Preparing for a gathering in Miami next week.

Somewhere in the middle of this work gets done, an election is will be decided and I’m just wiped.

Categories
Media Startups

Day 1381 and Radical Responsibility

I thought the discourse around “founder mode” had died down but Kim Scott the author of the best selling book Radical Candor decided to link the meme to what she considers a so-called rise of “neo-authoritarianism” in Silicon Valley culture in an op-ed in the New York Times. Naturally it’s about Trump too.

My read on her thesis is that she has decided to use a technique she disavows in her own work; the frame of the piece is manipulative insincerity. It’s an unclear criticism being used for political gain.

She works to convince the reader that actually the most libertarian and individualistic demographic, who regularly decries state power (especially its use of coercion to drive censorship, limit transactions and restrict compute), are in fact, actually vouching for totalitarianism.

Gift Link to New York Times “How Founder Mode Explains the Rise of Trump in Silicon Valley

Even the graphic hints at the supposed appreciation of neo-monarchy as a nod to nRX intellectual Curtis Yarvin.

I fear she firmly missed the point of founder mode for her insincere political framing. Despite her clear understanding of our values.

In that original recipe, venture capitalists invested in founders rebelling against established hierarchy and building great products. And when those rebels themselves became too hierarchical, venture capitalists turned to new founders aspiring to overtake the old order.

She is right about we prefer to work as an industry and how we see our efforts. “Many of Silicon Valley’s greatest products were originally intended to liberate, not to control people.”

And yet missed she missed that founder mode is about liberating our founding teams from the suffocation of professional management. It’s got nothing at all to do with justifying tyrannical founders.

Rather founder mode is about limiting the tyranny of managers who can stymie progress despite having little personal responsibility for the success of the firm. In another world, she might have written a sequel called Radical Responsibility about fixing this problem.

Larger firms have a pantheon of corporate departments to ensure smooth governance from legal, to HR, to corporate communications in order to comply with state expectations.

As regulations have ballooned so too have the specialties required by the middle managers. We must be in compliance. We must take everything and every view into account. We must do things by the book.

Founder mode isn’t about running ripshod over your people. It’s certainly not about Trumpian declarations of what must be done. She’s absolutely correct that “emotional dysregulation, bullying and bloviating are not leadership attributes”

I find her criticism to be manipulative insincerity. She’s deliberately missed the point of the original Paul Graham essay, inserted her own political insinuations about how Silicon Valley is hiding their true preferences for authoritarians while herself advocating for a pass the buck culture. It’s not fit for Radical Candor and I’d expect better from someone of her stature.

Categories
Finance Startups

Day 1376 and Q3 2024 Investor Update & Market Analysis for Chaotic Capital

Welcome to the Q3 2024 update for chaotic.capital LPs. I’m choosing to post a selection of our reporting publicly so prospective founders and LPs can see our thinking.

You may be invested in chaotic.capital because we invest in ideas that adapt humanity to our new chaotic era.

Enabling resilience in the face of unexpected & rapid change is our lodestar. It’s a simple heuristic that yields a complex thesis: that technology is a tool for increasing leverage. 

In addition to these investor letters, you can always visit jfredrickson.com, where I write every single day about whatever I’m thinking about. You are also welcome to DM me on Twitter @AlmostMedia or text me on Signal any time.

Q3 was another strong quarter for chaotic.capital. Our ability to identify and back founders early remains core to our success and we’re seeing it both with the inbound flow from founders (as seen in the two new deals we did this quarter) as well as the progress from our existing portfolio, with four new markups this quarter and substantial business progress on those and others.

The markets are increasingly focused on power and compute. What was once a contrarian focus on energy, infrastructure, crypto, and artificial intelligence has now become a core narrative among informed investors.

We believe the future of compute—particularly in relation to crypto and AI—will increasingly be viewed as a basic right, not a privilege, as these technologies scale to mass adoption. 

As governments grow more cautious about debt and monetary risk, individuals and organizations will turn to trustless systems to ensure secure transactions and autonomy.

This is why we focus our investments in the space on foundational layers that will power the next generation of applications.

With portfolio companies like Squads providing on-chain economy tooling, Kuzco reducing reliance on intermediaries while creating an open market, SFCompute pricing compute and creating spot markets, and Chroma becoming the go-to choice for open source vector databases, we see the intersection of crypto and AI creating secure, scalable systems for individuals and organizations alike.

Access to compute is quickly becoming synonymous with freedom of speech and, ultimately, the freedom to transact. 

These open trustless systems enable efficient transactions and verification, a crucial development as geopolitical multipolarity continues to rise, and more people need to ensure their interactions are secure without reliance on the state.

While Americans might not yet fully appreciate this, we’re seeing growing demand for these alternative systems and open models from those who are navigating increasing regulatory pressures and instability.

Europeans, whose governments are deploying strict limits on AI models are beginning to understand, those from countries facing geopolitical uncertainty (e.g., Israel, Ukraine), live it already, and those in countries with unreliable currencies and legal systems have been navigating anarcho-tyranny for decades.

But it can be precarious in the US as well, in California it was only the intervention of a veto from Gavin Newsom that prevented SB-1047 from restricting compute and hobbling the development of open source models.

Looking forward, this ability to access compute at scale may well parallel the right to transact. As nations confront their own risks, network state behaviors will become more prevalent, driven by the need for secure, decentralized systems that ensure autonomy in an increasingly unpredictable world.

We’re excited about the future of chaotic.capital and the opportunities ahead. As always, I’d love to talk about any of this with your discussions with you, so feel free to reach out. We’re just getting started, and there’s much more to come.

Categories
Aesthetics Startups

Day 1363 and Landfill Apps

Building good software is a topic on which many of my friends and colleagues have extremely strong opinions.

Anything built by humans can become a craft with skilled artisans and building software doesn’t escape this. While there are 27 million software developers in the world and 4.4 million of them are in American, if you pressed the startup community most would agree the number of good software developers is much lower.

I came of age in the blogging era, where we got writing like Joel on Software. I learned to build thanks to other builders sharing their craft and discussing it on forums & personal sites. I had access to the insights of builders like DHH and Alex Payne. Their commitment to publishing accessibility helped onboard millions of normies like me.

In some ways, startups and the software giants of FAANG are a victim of our own success. We onboarded the world to our efficiency.

And now with AI coding software (incidentally trained by Stack Overflow data & GitHub repositories built by my community) we are experiencing a Cambrian explosion level of coding access.

And it’s not Zapier hacks or snide remarks about Rust anymore. Anyone who can think critically about a product feature can build it with clear thinking and natural language.

I recommend “In The Beginning There Was The Command Line” by Neal Stephenson so often because every time we have an abstraction leap that allows more access we move further away from the power of craft.

And that is an unmitigated good in many ways as more people get the benefits of these tools.

But we are also going to get a slot of shit churned out because of that. Soychotic called them landfill apps when Marques Brownlee or MKBDH launched a $12 a month app for phone wallpapers. The app enraged Twitter.

If history is any indication the growth curve in app building is just getting started. Much awful nonsense will be built and sold, but imagine how it enables those with taste and opinions to make new solutions to our problems.

Ironic a critic of software like MKNDH should play such a role in reminding us of just how hard it is to make something good. Making money though can have a much lower bar.

Categories
Startups

Day 1343 and LFG?

The aftermath of a long weekend is one of my favorite shared cultural experiences. The scramble to reposition yourself back to your work, family and home life always makes the first 24-48 hours back extremely chaotic. The sprint to send reminder emails and respond in kind to others is overwhelming for everyone.

Any number of projects, financings, fundraises, and other sundry needs and obligations are percolating back into my inboxes.

First it was the three day weekend folks. Then today the “extra” four day folks. And yet the materials I need most are still in that liminal space of “not quite back to the office” just yet.

I was at our normally quite sleepy local airport today and it was packed. People leaving Yellowstone and Big Sky with a few folks returning home. A milieu of campers and and millionaires all navigating back to reality.

The next 10 weeks or so are some the best of the year to fundraise if you are an entrepreneur. It’s the season of “let’s fucking go” even as the chaos of the American election season has everyone on edge. Rightfully so as nothing roils markets like uncertainty.

Summer has activity but August tends to be dead and this first week back is when we all shake it off and return to work. The other seasons to raise are January through March with spring break and Easter as the first cut off. Then it’s best to try to finish your fundraising before the end of May or at least by mid-June.

So if you are ready to be back and are a founder fundraising (or considering it) just slide into my DMs on Twitter.

Categories
Startups Travel

Day 1342 and SKU Bloat ZIRP Era

I was doing some packaging preparation for fall travel and was pleased to discover that I’d finally appeared to have built out a basics wardrobe that actually mixed and matched well. A decent capsule wardrobe I bought I’d never achieve had come together after literally a decade of failed promises from startups.

There was an era of direct to consumer startups that promised quality and simplicity. A startup would launch with few basic but upscale stock keeping units (or SKUs) that promised they would be all you needed to own at a fair price point. This was alluring proposition for many early entrepreneurs including myself.

The premise was simple. Why would you want to add unnecessary complexity to tee-shirts, glasses, or toiletries when you could get something good without worrying if you were paying a markup for branding or retail margins?

The DTC boom has been largely looked at as failure as a movement for both consumers and businesses. With the benefit of hindsight, many of the businesses relied heavily on growth that couldn’t be achieved without either expanding your retail presence in stores or without giving up on providing simple basics.

As the zero percent interest rate era boomed, brands released constant new and novel SKUs to chase growth in every vertical from sneakers to lipstick. The goal of better prices and simpler products failed under the weight of driving growth at scale. Darlings became pariahs and founders sold to roll up private equity firms.

ZIRP ended as post pandemic era inflation demanded higher interest rates. We all complained bitterly about cost and quality of consumer goods in the aftermath.

And yet maybe we judged things too harshly. A chaotic decade of changing macroeconomic conditions were not easy to navigate. The growth required by venture and private equity were always going to conflict with a simple ethos of shopping.

But here I am with exactly what I wanted from my shopping choices at the start. I’ve got my quality basics merchandised in a simple way from brands I purchased from directly. In other news, the Everlane Barrel Pants are excellent.

Categories
Startups

Day 1334 and Heads Down

I had a couple days of flare in my autoimmune condition that had struggling last week. Down time in bed, especially when you are in pain, can be a bit dangerous when the news cycle is popping off. Pain and American politics are a terrible combination.

I do pay attention to politics alas as I am involved in a number of issues (#FreedomToCompute, regulatory reform, and housing) so it’s easy to over do it with being extremely online. My nervous system doesn’t need any additional stimulation.

I was relieved to be back on my feet today as it felt good to be heads down at work. I’m excited about how my seed investing has been going over the past few years and I’m taking the next steps to evolve the fund. I’m so optimistic about what can be achieved. Founders are particularly motivated to build. Ingenuity sparks when things are darkest.