A New Glue For A New Kingdom
To me, the most exciting part of the Facebook/WhatsApp deal has nothing to do with the deal itself. Instead, I’m excited about the ramifications of such a deal. And I’m not talking about Facebook or WhatsApp here either. History will ultimately prove that deal genius or folly. But more importantly, I know that a deal like this has other people talking, thinking, and building.
The last group is key, but let me start with the first group. Once the fervor around the deal itself died down, we got a couple of compelling posts from the likes of Benedict Evans and riffing on it, John Lilly. Incidentally, both are now VCs. But neither started out that way, and both have long histories of solid thinking and writing.
Both understand that the Facebook/WhatsApp deal is simply the strongest signal yet that we’ve fully entered a new age in the world of computing where mobile is now the kingdom. And the $19 billion price tag simply shows that there isn’t yet a king.
Read Benedict’s piece — it’s terrific.
The Brutal Logic of Survivor Bias
One of the humbling privileges of the job that I have as a venture capitalist is that I get to talk to so many amazing, committed, smart, driven, talented entrepreneurs, builders, designers, operators, marketers, sellers, and on and on. And I get to talk about so many different aspects of what they’re doing, in such detail - it’s really an unbelievable privilege, and I’m grateful.
But one of the things that comes out of that is that sometimes I visit with entrepreneurs who are struggling to make things work, who are struggling to sell, or get attention, or get product market fit. And like the world-changing alphas they are, they wonder “WTF? Why isn’t this working? What’s wrong with me?”
And the truth is this: starting something from nothing is *hard*. Nothing comes easy. Competition is brutal and global and 24/7 unrelenting. Inventing is never obvious.
But we have a survivor bias problem. The companies and people we all compare ourselves to are the ones who won, and who are winning. The Googles of the world. The Dropboxes. Ev & Biz & Jack. We compare ourselves to some of the most outrageous successes in the history of the world. We compare ourselves to the winners and the survivors.
That’s a hard standard to live up to for anyone.
It’s useful, of course, because it helps us dream bigger. It helps us think more about what’s possible. More “why not us?” And that’s great.
But it’s tough to see the forest for the trees sometimes and remember that for many, it wasn’t an immediate success. For many, they’ve tried before. For many all the other, less successful endeavors in their lives turned out to be leading them to their ultimate success.
So that’s the message I give, really. Don’t sweat the hero story so much. Strive for it, but focus on the business and product and team you’re building. Remember that the company may have more chapters yet to be written, and that the people in it most definitely do.
Survivor bias creates a tough standard when it looks like everyone is “killing it” and “up and to the right” - but don’t let it distract you from doing the thing that *you* want to do, and don’t forget that sometimes we struggle to a breakthrough.
Facebook’s new Paper app looks really, really lovely. It’s interesting that one of the lead value propositions they espouse is that it’s “ad-free.” But if they really continue down the path of unbundling their apps (messenger, updates, etc), they start to lose some of the advertising impression power they get now from their integrated feed app. So if Paper works — if people really adopt it, feels inevitable that over time it won’t be ad-free. (Which, honestly, doesn’t bother me personally in the slightest, but YMMV.) But maybe it’ll allow better feeling, more targeted ads. Might be that charging the publications (they show Time & The Atlantic) a distribution fee might work.
In any event, looks like some really, really nice work by the product team there, and I’ll be excited to try it out on Monday.