David Friedberg: okay everybody today i'm going to break down coinbase's q3 earnings they had a huge drop off quarter over quarter but a huge performance year over year so we're going to get into all those details what a great company then i'm going to go into the startup checklist episode six where we cover markets and branding a great episode stick with us this week in startups is

SPEAKER_02: brought to you by linkedin marketing to redeem a 100 linkedin ad credit and launch your first campaign go to linkedin.com checklist odoo is a fully customizable and fully integrated suite of business apps that lets you build and scale your stack as you build and scale your business your first app is free forever and right now odoo is offering one thousand dollars off your first implementation pack at odoo.com twist that's o-d-o-o dot com slash twist and vanta compliance and security shouldn't be a deal breaker for startups to win new business vanta makes it easy for companies to get a sock to report fast twist listeners can get one thousand dollars off for a limited time at vanta dot com slash twist all right first up coinbase has their earnings out their

SPEAKER_10: share price has dropped over 10 percent in after hours trading on tuesday after they reported a 40 decrease in revenue from q2 to q3 so on wednesday coinbase's share price recovered from 322 to 341 is

SPEAKER_11: now only down five percent off of tuesday's peak drop it represents a 72 billion dollar market cap for the

David Friedberg: company which is extraordinary in q3 coinbase saw large quarter over quarter drops in major categories like revenue users and profits not dissimilar to robin hood's story but in their year-over-year numbers they were still up huge so if you remember robin hood's earnings on episode 13 13 two weeks ago revenue is down 35 percent quarter of a quarter but up 35 percent year-over-year what that means what

SPEAKER_14: that says to me is there was just a you know we had a big quarter people with stimmy checks you know crypto booms everybody in a mania to buy tulips or the next you know giant wave of consumer and

David Friedberg: technology innovation time will tell uh transaction-based revenues will swing wildly depending on market conditions that that's the truth about these things if things get really popular and there is a mania whether it is you know amc stock and stonks or dogecoin or bitcoin or nfts you know things can go crazy although i don't know if coinbase is actually trading in nfts yet so let's just get into the earnings real quick total revenue 1.3 billion that's up four times year over year 4x year over year that is extraordinary we've been talking about high growth companies being 20 30 40 50 growth 4x 400 growth it's down 40 quarter quarter there's going to be bumps in the road in these high growth companies so i think that's to be expected transaction revenue a billion uh that's 83 percent of their total revenue again that's up for 4x year over year down 45 percent quarter over quarter subscription revenue and services uh revenue 145 million that's about 11 this is mostly made up of

SPEAKER_14: blockchain rewards from people staking ethereum and custodial fees of 31.5 million that's where you get they get paid to hold on to your crypto and make sure it doesn't get stolen subscription revenue grew from 600k in 2020 to 8.6 million in 2021 those are small numbers compared to the transaction fees the custodial fees etc however it's 12x right 13x like that's a big multiple and so i do think that robin hood and coinbase and all these financial services companies are going to have great subscription

SPEAKER_23: revenue if people will pay for calm in netflix and spotify and steezy to learn how to dance to learn how to you know get to bed easier they're going to pay for financial subscriptions it's still worth it

David Friedberg: right and so i'm paying for twitter now i did twitter blue for 2.99 a month other revenue 77 million uh they don't specify what this is um i'm thinking those are services revenues when they do big block transactions i.e you know if somebody wants to buy a billion dollars in bitcoin maybe that's what it is

SPEAKER_14: last week crypto news outlet the block reported coinbase was testing a new subscription service called coinbase one benefits would reportedly include no fee trading which would put them head to head with robin hood which is going head to head with them in crypto now and prioritize phone support on holidays and weekends no word on the cost of the subscription yet i think 5 10 bucks a month is a

SPEAKER_23: no-brainer i would like to see these companies even go 15 20 per month and have something really great for people coinbase is trying to diversify away from transaction-based revenue uh according to

David Friedberg: sources robin hood offers something similar with robin hood gold that's five bucks a month and that lets you have bigger instant deposits professional research from morningstar level 2 market data from nasdaq access to margin investing all kinds of like premium stuff and uh when you have those kind of programs it basically lets you segment who are your best customers it's kind of the amazon prime of uh this service you also see that with icloud i now pay for some icloud i pay like 30 or 40 bucks a month

SPEAKER_14: for an icloud bundled subscription which gives me arcade news two or four terabytes for my family so now all three of my daughters when they come to me for a game i say go to the arcade tab you can have any game in arcade you cannot have the other games uh because they have all kinds of upselling

SPEAKER_23: and garbage in them that i hate thank you shout out tim cook for making a nice clean uh arcade where i can have my kids and trust that the games are not uh trying to manipulate them so much and then the news product is pretty good too on apple news uh shout out to apple news because now i don't have to have a wall street journal subscription i can just see some stuff there okay back to coinbase

David Friedberg: monthly transacting users 7.4 million again up massively 3.5 x year over year but down quarter over quarter that's a good number to uh look at like because you do have a lot of holders you have people who created accounts maybe bought one bitcoin or a tenth of a bitcoin robin hood has 17 million monthly users so you're seeing the difference between the crypto and the trading of stocks i think the crypto people they may buy every couple of months but they're holding it they're not selling their bitcoin that's the whole point is to hold it forever and so i think that's a great opportunity for robin

SPEAKER_23: hood to add users and then adding stocks is something that coinbase could do if you know people are trading stocks they could get more trading going on net income 406 million up 5x year over year pretty

SPEAKER_11: efficient company uh down 75 percent quarter over quarter for these companies i really don't care about their profits i care about their growth and the number of customers they have i would rather see them uh not have profits at this point and see growth public markets might feel differently in

SPEAKER_23: related news bitcoin and ethereum are now at all-time highs bitcoin 68 thousand dollars ethereum almost

David Friedberg: five uh coinbase went public via direct listing in april at 381 dollars a share popped up to 421 they hit 100 billion in july the stock bottomed out at almost half 221 so this has been a lot of swings we

SPEAKER_23: saw that also with uber which i think during the pandemic went down to 15 16 a share up to 60 now at 45 with price targets of 70. like these stocks when they first come out i think wall street has to understand the business and look for consistency look for profits and so that represents an opportunity

SPEAKER_11: it also represents the danger of some of these companies because you know some retail investors might not know the difference between nikola and tesla even though they are the first and last names of a famous scientist they're two radically different companies and so people have to you know the markets i think retail investors have to learn the difference between them they're getting pretty savvy i think and they have to understand what exactly they're buying and what the risks are

SPEAKER_10: you're going to see a lot of speculative stuff come out v tolls electric trucks anything that's a theme quantum computing and space travel all of these things are highly speculative uh synthetic

SPEAKER_14: biology when these things back and go out early pre-revenue or modest revenue customer traction be careful you're making a venture style investing and if the stock goes parabolic and goes nuts and the

David Friedberg: company doesn't have customers yet man just pump the brakes and you know you can wait to buy it is my best advice i don't want to give stock buying advice but if my mom or my brother are asking me and they said hey you know do i need to buy the stock i was like you know it's got the same price as another company with real revenue like coinbase and robin hood have real customers and revenue and nikola and maybe this veto company maybe they don't have customers or revenue yet maybe put 80 percent into the company with the customers and 20 percent into the speculative one there's some reasonable betting strategy here and it is gambling when you are investing in pre-product market fit companies you are gambling uh coinbase and robin hood are not that these are millions of customers

SPEAKER_23: loving and using these so what i'll say about this pair of companies i obviously have an interest in one and not the other but i have accounts on both is they're incredibly well-run companies they have an incredibly large user base already and passionate users who are not going anywhere in my estimation so i am a huge fan of both coinbase and robin hood also if you look at coinbase and

David Friedberg: robin hood uh the founders are still running the companies and that's always a great sign and they're

SPEAKER_23: constantly if you look at the product velocity releasing new products so robin hood with their crypto wallet and nfts are coming to coinbase according to some announcements so product velocity is really really powerful in a company led by a founder you see that with elon start with travis just constantly releasing new products uh you start with steve jobs there's this obsession with new groundbreaking um investments in new products and so congratulations to the coinbase team okay next up

SPEAKER_10: is our 10 items for our startup checklist we're gonna go over markets and branding stick with us

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SPEAKER_10: so just take that one hundred dollars get that credit and start your first linkedin campaign at linkedin.com checklist terms and conditions of course apply okay everybody welcome to episode six

David Friedberg: of our startup checklist why are we doing this because we get asked the same questions all the time by founders and we have invested in over 300 companies we invest in about 10 a month here at launch and my uh syndicate called the syndicate.com part of our jobs as investors is to let founders know hey you know here's what's around that corner or here's a pothole when you come around that corner there's a pothole there you know sometimes founders hit it they blow out a tire hey by the way that turn is really fast that exit ramp it says you can go 35 miles an hour on that exit ramp i might suggest doing 30 because it can get a little slick in the rain basically we're not trying to tell founders how to run their companies as investors but we do want to let them know of things to think about increasingly i find myself wanting to invest in startups earlier and so we have something called founder university and we started this program to maybe uh help people who are considering starting companies now if you've already started your company this checklist is still a great thing because you'll go through it and out of every section of 10 or so every episode we do 10 you're going to probably go six like of course i know that jacal seven of course i know that there might be two or three that become conversation starters because nobody can keep all of these items in their head at one time i was inspired to do this by a book called the checklist manifesto which i found out about from jack dorsey at square and twitter and i make everybody who comes to work for me read the startup startup checklist because it turns out when you make a checklist you know less planes fall out of the sky and less people die in surgery those are like two examples in the book and so checklists are important because they enforce uh discipline and increase performance and you have less cars flipping and spinning out of control and pilots losing control of planes i know it's kind of dark but it's the truth checklist did start with pilots and with surgeons and the book is a really great read highly recommend it so you can view this checklist at thisweekinstartups.com slash you guessed it checklist thisweekinstartups.com slash checklist you'll see the whole checklist i'm hoping that some of you write blog posts about this or maybe talk about doing it at your company you can remix this use it however you want uh non-commercially and then just link back to the original thisweekinstartups.com checklist

SPEAKER_07: of course if we miss something tell us what we missed and today we're going to do two topics uh

David Friedberg: that are somewhat related one is market and one is branding so let's get started first is item number 51 on the checklist are you creating a new market or servicing an existing one and how to tell the difference so i believe that some of the great brands induce a market to exist they create a new behavior in the world so if we look at something like uh spotify and com just you know i'm an investor in com obviously but uh not an investor but do love spotify you know people were listening to music before spotify came along in fact you know people had real networks or they had cd collections amazon music there were a lot of different music providers out there and people were using itunes to buy by the track consumers love music we know that so was spotify creating a new behavior listening to music no maybe you could argue creating playlists was a new behavior but spotify figured out the rights issues they removed a lot of friction from an existing market music listening was an existing market so they were going to compete with that existing market that means they were going to go head to head with people buying individual single tracks on itunes which of course was competing against cds before it so that was the uh way the market sort of played out in music you had cds which were printing money for the industry then you had single tracks buying you know particular songs on itunes for 99 cents that was a bit of a disaster for the music industry because you know people went from spending 12 to 15 bucks on a cd to just you know sniping the top two tracks that they

SPEAKER_23: wanted to listen to over and over again and artists hated it now you go back to spotify massive consumption

David Friedberg: you know and arguably people are listening to more music than they ever had uh now for calm what was the market for a meditation app before calm existed uh and headspace their competitor there really was no market for it meditation was this weird thing you did if you lived in santa monica and like some churches and basements or rec centers or a yoga studio on the weekends might have one or two meditation classes or there were you know five thousand dollar you know courses you could take it wasn't something that was in the general perception of the public and sure you could find on youtube or you know itunes education had some select mp3s here or there you could go find but there wasn't a netflix a subscription spotify of meditation so they basically created the category people didn't know they needed it they got it they had more equanimity reduced anxiety reduced depression more focus more joy in their life and then they added sleep and people have to sleep better you know all the great things that calm and their contemporaries did so they induced a new market i would argue that uh if you look at uber airbnb they also induced markets airbnb i remember in the early days i've told the story before i had one of the

SPEAKER_23: producers on the show say they were going to japan and i was like oh wow you know i know the producer was getting paid back then it wasn't a lot of money i was like wow japan's super expensive like i have

David Friedberg: to plan my trip there and think about what i'm gonna spend and she's like yeah i got a you know a room in kyoto for 40 bucks a night and i'm gonna go there for the first six nights and then i was like sorry 40 dollars like that's what you spend on lunch and she's like oh no it includes breakfast and i was like okay wow airbnb i believe yes it competed with hotels but hotels continue to do well so i think what they did is induced people to take longer trips more trips and maybe trips they wouldn't otherwise have taken so i think it did both and clearly the numbers show that the only people who really i think lost out with airbnb were the two star three star hotels in other words the really cheap

SPEAKER_23: hotels that weren't a great experience and you're like yeah i don't really want to stay at this hotel it's like 89 or 125 i remember staying at those with brian alvey back when i was broke and we're trying to get things going and i was 20k in debt with weblogsing and we would literally get whatever the cheapest place was you know 99 bucks in a city and we get a double room and the two of us would stay in the room uh together because we couldn't afford two rooms you know it's 99 bucks it's big money

David Friedberg: so airbnb then became an option shortly after that and uh obviously uber people started taking more rides they would go out more often so in la we saw this people wouldn't go out to dinner or drinking because they didn't want to drive drunk so there was a lot of you know stay at home culture i think it did induce more people to go out during that time free pandemic okay item number 52 on the checklist let's see if you can check this one off do you understand the difference between what i call a lazy tam and a bottom-up tam so tam stands for total addressable market and early stage investors are not generally making a decision on tam they're usually making a decision you know i'm talking about angel investors based upon the product the team and maybe some early customer traction however uh when you get to later rounds of funding yeah tam does come into play because people want to know how big can this be because you're charging you know 10 20 30 40 million dollars uh for the valuation of a company which means people are spending three to 10 million dollars to own 20 of it these vcs are going to want to understand the total addressable market well there's a lazy way to do this which you type in like what is the market for i.t and you know you find some number from gartner it's 4.4 trillion in 2022 well what does that include well that number is going to include everything like buying computers software monitors you know consultants it's a giant number you didn't create that number now what would be better is if you were going to make something very specific you were making a new uh webcam is it and the total addressable market for it comparable to the market for webcams no and then if you include in webcams like everybody who has a webcam which is every phone and you're like there's five billion webcams out there that's not your market either you're not if you're making a fancy you know state-of-the-art uh webcam that people would use as a replacement for the one built into their laptop that's a different market a very specific group of people like creators uh so then you might work on a bottom-up tam you might say hey who are people who are professionally creating video how many creators are there on youtube with over 10 000 followers how many uh creators on tick tock have over 25 000 followers those might be the people who will be inclined to be in your bottom up market and so you really want to understand the tam let's take another look at a lazy tam example you know you have acme corporation they're selling saas software to dentist's office they charge a thousand dollars per month per office okay great here's a lazy tam according to the american dental association from june 2020 the total projected dental spending for 2021 was between 123 billion and 154 billion lazy tam would you just take that number and put it in there oh

SPEAKER_22: you know this is what dentists spend on equipment that's not your tam if you're making saas software for

David Friedberg: them to manage their office you're not going to get 10 of that market of and have a 15 billion revenue company in dentist's office you would want to know well who are you selling to what type of dentist's office so well it turns out in 2020 there were 201 000 working dentists in the us according to the ada okay so now you got a more interesting number okay if they each had their own office your potential market would be 200 000 or if they each had paid for their own seat in the software there'd be 200 000 seats if you did sell by dentist so you can start to make some approximation here about those dentists well there are only 187 000 dental offices in the us according to you know some market research which are online so some office might have multiple dentists in them so you're seeing how i'm making a much more interesting approximation of what my total addressable market is by working from the bottom up and that is so much more credible when you go into a vc it means you understand your customers and market in a deep way not a superficial way instead of being lazy you're being thoughtful with investors thoughtful people who are of action are so much more attractive oh you get stuff done you take action and in fact doing a bottom-up tam puts you in the bucket of taking action you didn't just take the easy way out and grab a number when i see that i just think this person's lazy they just spent the least amount of time on the slide or thinking about their market now let's say you capture 10 of the market of the number of dentists uh dental offices out there well a thousand dollars a month times 18 000 or so dental offices you know 224 million dollars a year in revenue right it's pretty great you're making a real business that's a great business that i mean just thinking about it right now somebody build you know sas software for dental offices or tell me you know what's the state of the art there seems like a pretty viable market getting 10 of it equals 200 million a year pretty great market so doing a bottom-up tam is just going to make you so much more credible i think i've beaten that horse to death there let's go to checklist item number 53. if you listen to twist often

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David Friedberg: odoo.com twist have investors had success or failure in your market before this is the scar tissue issue and so if you were in the grocery business and you lost your shirt and pants and car and everything you know backing web van or cosmo in the 90s these were two services that were very analogous to

SPEAKER_14: instacart uber eads postmates doordash if you lost you all of your money on those one of two things can

David Friedberg: happen one you could say never again the market is too low margin it's too operationally intensive or you might say i wonder what's happened since that time when web van collapsed and maybe i should make a bet here and what have we learned what new technologies are out there if it turns out the reason web van did so poorly was because i don't know the trucks were always missing uh and you could never track things in real time well gps would have changed that right that for 20 years later everybody's got gps on their phone in their cars okay that could be a big change oh we have real-time inventory systems and robotic factories that keep everything oh okay the inventory was a big problem that's going to be 20 percent more efficient and if you have that scar tissue it could go one of two ways either it could attract you to the investment or it could make you absolutely have a bias against it so you want to know have your investors ever invested in that space in the previous example we talked about dental offices if somebody had made client server architecture for dental offices and it was just too expensive because you had to send somebody in and put a server for a hundred thousand dollars and network cards into the dental office and there was a hundred thousand dollar onboarding fee and dentists wouldn't do it because they would rather put that into an x-ray machine okay now you say hey we have a sas solution all it requires is a web browser and you're like well they've got five hundred dollar computers now a thousand dollar computers and they have a web browser so we've just eliminated that hundred thousand dollar onboarding cost maybe we should go after this again and this is a way to find investors and target investors sometimes people come to me and say hey we're blockable as one example a company we invested in we are in housing and say okay who might also be involved in an adjacency well if somebody had done mods or homes or adus they might be interested or if somebody had done a construction company and they just made foundations or windows or smart home technology or maybe they worked on a company that had factories like tesla oh and blockables like the tesla of building homes okay that seems like an interesting analogy let's go to the tesla investors so you can find investors by doing this technique and then you have to understand by asking them a probing question how do you look at the space because here's what we've learned i wonder based on your learnings what you think of our assumptions now this is like just absolutely going to light up all the neurons in an investor's brain they're going to when you say what did you learn from web van bill gurley and how does that relate to postmates man bill girl is going to talk for four hours he's going to pull out some notes he has in some binder from back then it is absolutely a way to engage investors deeply in your company so just think that through item number 54 on the checklist do you know who your competitors are one of the most frustrating things is uh founders who say we don't have any competitors and then you type in the name of their company competitors and you find a landing page on one of those you know websites that puts all the competitors for saas software and you see 17 competitors and then you ask them hey what about these competitors you're like oh those aren't our competitors why not well they don't accept paypal you're like what or they come up with some reason of why oh they don't have ai and it might be a valid reason in their mind but you really have to have empathy and think about the customers do the customers actually see a difference between taking a lift and taking an uber uh do they see a difference between using doordash and uber eats maybe not you know they may see some friction in putting their credit card in now the restaurants might see a difference maybe there's a different pricing or you know different number of customers so you can drill down on that and double click on it but you got to be honest about your competitors and almost everybody creates like this x y four quadrant better cheaper and we're the better version we're cheaper we're faster and cheaper and and everybody else is slow and expensive i think those are good intellectual exercise if you do them with intellectual honesty so don't be ridiculous is what i would say and i find people are often ridiculous in what they consider competitors and what they don't often uh people will say our competitors are using excel right so we're creating some sas software but most people use excel that's valid and then you have to ask yourself well why would people pay for it if it's working in excel are they really going to pay for it a lot of people have pitched me on a crm system for you know tracking our startups

SPEAKER_64: and i'm like yeah i don't feel the need to pay for that right now i might at some point but you know

David Friedberg: in the early days i was like i think i meet with 20 companies a month so i can keep it in a google sheet or i can manage it in my email box thanks but not necessary at a certain scale you might and so those are the things that you have to really take into account is the consumer and how do they look at it and it really is a super tell when people leave out their competitors and then you find out about as an investor just intellectually dishonest or shows a lack of rigor and your credibility goes down when you're a founder especially in a funding environment you are trying to be more credible than there are other options to invest in and you're in that credibility race and understanding your competitive landscape and being able to talk about it in an intellectually honest way is the sign

SPEAKER_14: of a mature founder and a backable founder so keep that in mind item 55 on our checklist what are the

David Friedberg: barriers to entry in your market it's critically important if you think about a market like uber again what is the blocker well you need drivers and we've all seen how hard it is to get drivers and the competition for drivers if you said i want to compete with doordash uber eats postmates today

SPEAKER_65: well they've got all the restaurants online does a restaurant want the seventh ipad the eighth ipad that

David Friedberg: doesn't have a lot of customers very hard to break in so there is a network effect you know in some businesses other businesses it's hard to rip out the technology so you have to understand are you the last people to come in or are you the first people to come in what are the barriers to entry in this market tether has been operating a stable coin we've been talking about that here hashtag tether investigation what a disaster that company is the fines the malfeasance you know rumors everything is just crazy about that company uh who knows if they pull a rabbit out of

SPEAKER_14: the hat but they are faced with a lot a lot of competition and a lot of headwinds regulations circle doing things you know in a much more uh transparent way with a lot more regulation

David Friedberg: so what is the barrier to entry it's high to make a stable coin i would say it's not an easy thing to do however with enough money at stake people will take that on and so that is something to think about i just saw yesterday somebody's starting i've seen two of these now two people taking on google search one is called u.com and then there's another one and i was like wow you know i thought i was crazy doing it in year 10 of google these people are doing a year 20 something of google pretty crazy okay so putting uh the barriers to entry to mind you do need to understand how defensible and what defense is branding is part of being defensible so having a great brand is defensible if you look at airbnb they have so much trust forget about the network effects just the fact that people trust airbnb and they've used it before and the people who are hosts we had an airbnb we were running uh we had a house we had moved out of unexpectedly we were renting it we had a party there there was six or seven thousand dollars in damage the person broke the agreement to not have

SPEAKER_23: more than eight people in the space they had you know many more people yeah they had a rager and when i confronted the guy he's like i'm not gonna lie it was a great party i was like great you did

David Friedberg: six thousand dollars in damage but lo and behold airbnb was able to settle that this is through some combination of insurance and charging the people for the damage i don't know exactly how it got worked out but it got worked out and that made me say you know what i'll use airbnb again you might have that on the consumer experience you might have it in the host experience branding is part of defensibility

SPEAKER_70: and so let's talk about branding a little bit okay sock 2 compliance is critically important why if you don't have sock 2 tight you're gonna lose major customers you just can't close them it's that

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David Friedberg: item 56 on our checklist does your company name pass the bad telephone test in other words is it easy to spell over the telephone and i think it's critically important to make sure that happens uh in brad stone's book the everything story jeff bezos originally wanted to call his name cadabra as in abracadabra you know just how magical shopping was one click boom you get something bezos's lawyer convinced him the name sounded too similar to cadaver as in a dead body and when he couldn't understand over the phone what bezos has said bezos said yeah can you trademark cadabra the lawyer said cadaver that's a terrible name obviously bezos took his advice went with amazon great moment in history you have to ask yourself when you leave vowels out or you misspell stuff how much of a blocker is that going to be i like really simple names like uber and com but remember uber didn't have the uber.com domain that was owned by a music record label uh eventually they were able to buy it and they were uber taxi and i remember saying to travis like we got to drop the taxi like and can i get credit for that in the movie and he laughed he said what do you mean i was like you know like sean parker's getting credit for taking the the out of the facebook he's like well we're obviously gonna take it out i was like i know you're obviously gonna take it out all i'm asking for is credit so when they make the movie and they do the

SPEAKER_23: hbo show can i shout out brian koppelman can i get credit for that they eventually dropped it

SPEAKER_14: airbnb you know a really great brand and if you can't get the domain name it's okay to fake it till

David Friedberg: you make it but you really want to have you really want to pass the test uh it's very important

SPEAKER_23: robin hood spotify yelp you can go down enterprise names shopify slack salesforce they're really easy

David Friedberg: to spell right nobody's going to misspell sales force slack zoom i mean maybe you put an x in there but generally speaking people are going to get that right now item 57 branding uh do you own a great domain name now it's hard to get a great domain name zoom was not zoom.com it was zoom dot something

SPEAKER_23: i can't remember what the name of it was originally uh and i think it's still zoom.us so it's still zoom us which is ridiculous they they did get zoom.com but i guess they never changed it i don't know if that was a technical thing or just them uh shouting out to their uh existing but you can get something like

David Friedberg: zoom.us or zoom.is or zoom.co for now and if you ever get the domain name great if you don't it's not going to be a disaster when i saw com.com on this very podcast i immediately was attracted to the founder because he could get the domain name so getting the domain name is great you're going to

SPEAKER_14: have more credibility but if you couldn't get com.com get com try com be com go com com app the com app you can grab something like that and what i suggest you do is that you flood the zone so you get 30 different versions of it why is that important well let's say the person who owns com decides like they just have a blog and they've been doing it for 20 years they don't want to sell you com.com you say hey we have com blog the com blog com blogging com.blog get com try com be com would any of

David Friedberg: these appeal to you in our collection to move your site to in exchange for a million dollars for the domain name now you've basically given them an exit ramp so this is one of my secret techniques but the exit ramp technique is a great one and then go get all the social media handles the twitter instagram etc so you can offer them the bundle of handles great way for you to get social media handles are important as well you don't need to have the.com but it does impress people when you do italic was recent on the program and i was just like that's cool they got italic.com is it necessary they could have shop italic they probably do own shop italic i own a day.com which was going to be like uh we're still planning on doing this at some point like an email a day about a specific topic or

SPEAKER_14: an sms every day about a specific topic and uh never got around to building it but somebody made a

David Friedberg: clothing line a day like i don't know underwear a t-shirt a day i'm not sure exactly what that why they picked the branding and they're using some other domain for it and that's fine right like they don't need my domain name they didn't want to pay me the price i paid for it so i was like okay some point maybe they go public and they're like hey jacal we'll give you a million dollars for it and i'd be like okay great here you go okay let's talk about logos because that comes up often uh most

SPEAKER_23: logos are so ugly um classic example look at the uber cab logo i mean it is terrible i called it uber taxi before it was uber cab right so uh if you check out the early designs of uber cab the logo was like

SPEAKER_64: really bad it looked like it was designed for 50 bucks and probably was it looked like it was designed in

SPEAKER_23: microsoft paint i when i did mahalo had a little bit of money and i convinced john hicks who did the mozilla and thunderbird logos to do the mahalo logo came out beautiful cost me a couple of thousand dollars he wasn't available for like six months i basically said what do you charge for a logo you know like in the waiting list it was like two grand i said hey if you happen to have an opening i'll pay you four thousand uh and i'm willing to put the two thousand dollar deposit right now and if somebody cancels or they're behind and you know what money talks and there was some weekend i guess

David Friedberg: somebody was behind in getting him collateral and he just told them like hey listen he didn't get me the deliverables if i remember the story correctly and um he just did it for me in a week and it was just absolutely fantastic thank you john hicks i never forget you did that for me if your product is absolutely fantastic the logo doesn't matter you know craigslist uber cab you know the the product if it's transcendent and awesome people don't care about the logo and you can iterate and your design team will want to iterate as time goes on you'll want to do a logo design i remember uber did a gorgeous one at some point that was animated uh when travis was running the company they spent a lot of money on it they did a really thoughtful design and it was basically news when they did a new logo famously steve jobs with the next logo spent a bunch of money on it these branding exercises i think can be worth it later on in the early days you know spending 50 bucks on a logo and then spending 500 then spending 5 000 then someday spending 50 that's a fine way to do it uh i think it's wise to not burn all your money early for a logo i happen to have raised millions of dollars and i was able to spend 4 000 on the logo early probably not the best use of capital you know early on but i thought it was

SPEAKER_23: important and you know i had raised a ton of money so okay branding item number 59 is your website

SPEAKER_14: beautiful is it designed cleanly well terrible websites really destroy your credibility with investors it can be simple it doesn't need to be a 10 out of 10 but it can't be a four or five or six

David Friedberg: out of ten if you use squarespace the site's going to be beautiful just use squarespace when you start out use one of their templates boom they're not going to make this into an ad for squarespace they've been a supporter of the program but when i think beautiful website i just immediately think squarespace you can't have an ugly website has to be gorgeous but does it have to be a 10 out of 10 no it just can't be a five or six to get to seven and a half to eight and a half is good enough that's probably where you want to stop uh and get back to work on your company you don't have to obsess but you do need to trend towards having something that is high functioning and clean and understandable so you don't

SPEAKER_23: want to have a bad impression we did remote demo day uh you can go to remote demo day.com and um you know we we were immediately had a gorgeous website but then we had an interesting company pitch us for remote demo day marine who works on our investment team is an associate shout out marine uh she

David Friedberg: was getting the pressure from the company hey we got a bunch of vc circling and that's not uncommon the founders will you know play that card sometimes it's true most of the times it isn't so be careful

SPEAKER_23: playing that card because you will lose credibility if you use high pressure tactics like that oh my

David Friedberg: god we're gonna close we're gonna close and then you don't close credibility goes down and then we looked at their website it was like literally out of 1999 and the founder of credibility goes way down it's like wait a second how could it look this bad and then if the traction doesn't match up now the credibility and the story starts falling apart that's what happens most people will not tell you this but people do judge a book by its cover to not have a modern designed website that looks

SPEAKER_23: good on a mobile phone you know in 2021 is just a bit of a deal killer so don't lose credibility by having an ugly book cover okay finally item 60 on our list do you have a concise company mission can you say in a sentence uh and do people understand it robin hood democratizes finance launch we support founders and inspire innovation jetson the veto startup i talked about earlier this week they make anyone a pilot airbnb create a world where anyone can belong anywhere that's a bit ambitious or you know i might go for simpler one but i think as companies get bigger they kind of make the mission you know really ephemeral um create a world where anyone can belong anywhere uh create a world where anyone can stay anywhere affordably you know there might be another word for that uber create opportunity by setting the world in motion it's a little bit corny i'll be honest so you see as companies get bigger they can kind of get into this like corny zone i like it when it's simpler make anyone a pilot uber's

David Friedberg: original mission your private driver i remember that your private driver support founders and inspire innovation make anyone a pilot i'm into those amazon we strive to offer our customers the lowest possible prices the best available selection and the utmost convenience love it easy cheaper better is kind of what they're saying amazon is the ultimate and just being blunt when their value proposition like

SPEAKER_23: aws cheaper and more stable we've got more servers and we charge lower prices it's pretty great you know i don't know what costco's or like sam's club's line is but it's probably like a lot of stuff for a

David Friedberg: cheap price unbelievably low prices for way too many calories this week in startups.com slash checklist for the full list this week in startups checklist for the full list stay tuned for episode seven okay

SPEAKER_54: here's a great question from violet ivy two on the youtube asks a lot of baby boomers retired as a result of the pandemic in the u.s needs people in various industries including healthcare what do you think the best way to address this is hmm if only there was a way get more people to go to work hmm what would we do huh well let's take a career nursing plumbing uh well why don't we make it free to get

SPEAKER_23: those degrees or make those degrees with an isa and income sharing agreement where we offer it for free or uh based on uh you know taking back one and a half times the educational cost over 10 years over seven years whatever it is like let's really incentivize people another way to get people to go back to work is to raise the uh raise salaries that's happening another way to get people to come back to work is to make them feel respected to make them feel a sense of mission or purpose in their job not

SPEAKER_39: easy to do but also not impossible uh so i think labor has the advantage right now because you have

SPEAKER_23: a combination of things happening obviously stimulus gave people more runway and the double unemployment situation which is ending all of that gave people a lot of runway people's homes increased in value that gives people extra runway people re-evalued their wild lives and said you know what i have enough money in the bank i want to take the next 10 years and go skiing no i'm not doing that to my team who's wondering what i'm going to just pull the rift cord i love coming to work

SPEAKER_35: every day um also could enjoy some more skiing though um putting that aside uh yeah raise salaries

SPEAKER_65: train more people and then here's a crazy idea hear me out if we have more jobs open then people willing to take them then maybe call me crazy we could allow some highly skilled people into the country since americans don't want those jobs we are so privileged in this company i'm sorry we're so privileged it's a little friends we're so privileged in this country to have so many opportunities that people are so affluent that they can turn them down that is something we should celebrate it's america's so great a lot of people don't need to go to work and they're happy not going to work they've either made enough lowered their burn or some combination of the two or become micro entrepreneurs where they do projects and they make money for three months and then take six months off congratulations

SPEAKER_39: but let's be honest here if we got 11 million job openings and under five percent unemployment maybe it's time for us to talk about a point based system at the border what does it mean it means you just take the emotion out of and the polarization out of immigration immigration shouldn't be all or nothing it shouldn't be about your evil or your you know mother teresa there's a lot of nuance here

SPEAKER_14: everybody coming into the country uh provides some amount of value some people might be a drag when they first get here and then eventually become uh you know contributors right somebody who comes here and

SPEAKER_39: uses social services needs an education they might actually be a drag for some period of time and you're making an investment with the hope and i think it's a reasonable one that they will pay off in their

David Friedberg: taxes and their contribution to society later kind of works for all of us and our parents right and our grandparents who came here i don't see why it wouldn't work in the future but since this country is

SPEAKER_14: very attractive people around the world we might get a disproportionate amount of people want to come here and since a dish disproportionate number of people want to come here we do need to have some limits why don't we tie the number of jobs that are available to the number of people that we let in so in other words you take the last five years you have a rolling average of the last 200 weeks 250 weeks of unemployment data you look at it and say what jobs are open okay teachers doctors lawyers lawyers construction okay great let's take out construction great where can we get incredibly trained construction people great if you're applying and you say i've got 12 years experience in construction i'm a plumber i'm an electrician great we need more of those looking back at these four

SPEAKER_65: years we need uh we will give a preference to what we actually need in the country is that too cutthroat or is that logical because you do want to have product market fit here you do

SPEAKER_14: want to have immigrant job fit it doesn't help anybody if we add i don't know if we let's just suppose that we had i don't know too many nurses it's not the case but letting in a million nurses or a hundred thousand nurses and they can't find jobs that doesn't help anybody that hurts them because now they've got to take a job that they're not satisfied with and it hurts the entire base of nurses because maybe salaries get lowered and that's not good either so how about some logic

SPEAKER_65: and then oh they want to invest in the country great so we'll hold 20 of slots for people who are willing to invest a million dollars or a half million dollars yeah they're buying their way in yeah they're buying their way into great businesses so other people get jobs that's a good thing you want to let some people buy the front first class seats those first class seats are what make the seats in the back so cheap that's smart overcharge them if i told you we were going to put in the front of a

SPEAKER_10: plane you know two private bedrooms and they were going to cost 25 000 each to go to italy and that

SPEAKER_65: everybody who was in coach instead of paying 800 got to pay 650 who's not taking that deal we're all taking that deal yeah go blow 25 large on a bedroom in the front of the cabin mazel tov great

SPEAKER_10: that's what we need to do we need to look at this and say let's have a sorting mechanism here okay this person's going to go back to their country and be murdered because of their race religion creed color whatever yeah we we need to keep 20 of the 20 of the spots for people who are refugees who are going to face imminent harm death persecution if they go back to their country right so people come from cuba or they come from venezuela or they come from china or russia and we know hey if they go back they're just going to be put in a gulag and tortured and murdered or worse let's keep them here you know like we could have some sympathy um and the point-based system could also be uh how easy how easily will you integrate into society well what makes it easier to integrate into society speaking the language a lot of other countries do this by the way a point-based system in the uk point-based system in canada point-based system i think new zealand i'm sure of australia i'm pretty sure new zealand so the point-based system is super um i think fair and it changes the discussion from you're a horrible

SPEAKER_54: republican who is a xenophobe or you are a bleeding heart liberal who just wants to create chaos at the

SPEAKER_65: border that's not actually what's happening uh in other countries they're just saying let's be

SPEAKER_10: thoughtful about it let's be thoughtful if a person has a college degree and speaks english fluently are they going to have an easier time coming to america or canada of course they are well that's what the other countries do that's what canada does if you have a degree or a master's degree or a phd you get points for each of those and that gives you a greater chance of getting in does anybody argue with that so anyway that's a long-winded answer to you know what do we do about uh the job problem i think sensible immigration which i just want to tangent on is something i've been researching because i'm an idiot i had no idea how any of this works and i kept asking during this whole back and forth with politicians fighting hey um what's the actual number and i couldn't find it any of the stories new york times wall street journal washington post nobody ever mentioned how many people came in last year how many people came in this month how many people you know got in because of h1b versus this they never talk about the actual numbers i i always start with the data but these government officials are so polarized they don't start with the data they start with the emotion is that a good idea if you're flying a plane should you get into the cockpit and say you know what

SPEAKER_39: how am i feeling right now am i scared am i nervous am i angry am i happy or should you say what's our altitude what's our speed uh okay uh how's the plane flying you know like maybe look at the can we just look at the gauges and just make a decision to keep the plane flying you know smoothly

SPEAKER_22: that's what we should be doing with our government they should be keeping the plane flying smoothly less turbulence all right end of rant