Arming the Creators
A podcast with Hugo Amsellem, reasons not to go to Mars, the outlook for venture funding, and more.
Hi folks, Patrick Ryan here from Odin.
We build powerful tools for VC’s, angels and founders to raise and deploy capital seamlessly.
I have decided to start publishing more regularly.
The goal is to hit your inbox with something interesting every Sunday.
The newsletter will be a mix of interesting tech news, articles & books I’ve enjoyed, plus other funny stuff I’ve found on the internet (basically the “Best of the Internet” section, for long-time readers).
I’ll also share podcast episodes and longer reads from time to time, plus guest posts from Odin’s staff and friends.
Let’s get started.
Arming the Creators: a conversation with Hugo Amsellem about Consumer Tech, Community and the Creator Economy
A few months ago I caught up with consumer angel investor Hugo Amsellem.
Hugo has had a fascinating career - he started a crowdfunding platform for musicians in the late noughties, was on the founding team at famed French startup incubator the Family, and more recently worked at JellySmack, who are sort of building the 21st century equivalent of a record label for YouTubers, Twitch streamers and that sort of thing.
He is an active angel investor, focused on consumer social, community and the creator economy. He writes a fantastic blog called “Arm the Creators”, analysing how an entire generation of creators are bypassing traditional gatekeepers for the first time in history.
Content creators and software startups are the same, but different:
People often talk about content and code as similarly “high leverage” - they are both permissionless, low cost to produce and keep working for you while you sleep.
Just like startups, there is a power law distribution in the success of content creators.
But unlike startups, creators are completely at the mercy of a constantly evolving cultural landscape, and an ever changing set of algorithms.
They are also under relentless pressure to perform, and essentially unable to build systems (and code) that replace them as “founders” of their enterprises. Since content is not reconsumable in the same way that code is, you always have to be making new videos / podcasts / whatever, combining quality and quantity at a frantic pace.1
In short, this means that you can be on top of the world one day and nobody the next. Look at the case of the declining popularity of YouTuber PewDiePie, who in 2019 noted that taking a break could kill his channel altogether.
Sure, you might be able to gain “1,000 true fans”… but keeping them is another matter altogether2.
We also chatted about:
Consumer social, and why we haven’t built many great consumer tech companies in Europe (yet);
Community and the loneliness epidemic amongst young people - an opportunity for startups and investors.
I strongly encourage you to give this episode a listen - one of my favourite podcast recordings so far!
Boris eating onions
On the subject of the creator economy - perhaps AI will give creators the ability to “scale themselves” and operate more like companies.
I suspect not for a little while yet though…
If you enjoy this, you might also like Will Smith Eating Spaghetti.
The Mars Religion
I’m a techno-optimist, and a sci-fi fan. I definitely get excited at the thought of mankind’s multi-planetary future amongst the stars.
However, this article, from Maciej Ceglowski, argues that manned missions to Mars are an incredibly silly thing for us to be pursuing - at least for the time being.
It’s also very funny.
Ceglowski’s argument has three key gambits:
The research costs (and research timeline) will be insane:
“The things that make going to Mars hard are not fun space things, like needing a bigger rocket, but tedious limits of human physiology. Understanding these limits well enough to get to Mars will require years of human experiments beyond low Earth orbit.”The engineering task of getting humans - who aren’t designed for space at all - to Mars is kind of ridiculous:
“The technology program required to close this gap would be remarkably circular, with no benefits outside the field of applied zero gravity zookeeping… I would compare keeping primates alive in spacecraft to trying to build a jet engine out of raisins. Both are colossal engineering problems, possibly the hardest ever attempted, but it does not follow that they are problems worth solving.”We will contaminate the very thing we came to explore, so we might as well just use robots and do it all remotely:
“Humans who land on Mars will not be able to avoid introducing a large ecosystem of microbes to the area around the landing site. If any fugitives from the spacecraft make their way to a survivable niche on Mars, we may never be able to tell whether biotic signatures later found on the planet are traces of native life, or were left by escapees from our first Martian outhouse….
Even if you don’t care about contamination, NASA is required by treaty to care, and that has severe consequences for mission design… even there, they’ll have to do their lab work remotely, the same way it’s done today, raising the question of what exactly the hundreds of billions of dollars we’re spending to get to Mars are buying us.”
So why is everyone so hell-bent on going?
In Ceglowski’s view, it’s a combination of misguided Elon-fanboyism, and handwavey talk of humanity, the explorer species, fulfilling its destiny.
You do have to wonder if we’d be better off spending the money on improving things here on earth.
The Piss Goblin
This story of a man’s encounter with Berghain’s infamous Piss Goblin in a Berlin park made me chuckle.
My cofounder Mary tells me that she knows several VC’s & founders who are personally acquainted with the Piss Goblin (no, I am not joking).
So let me know if we can be helpful with an introduction.
Be Greedy When Others Are Fearful
A recent report from Pitchbook indicates that times remain tough in venture land:
The average tech IPO has dropped to $69.5m this year, falling below $100m for the first time in a decade, and fewer startups are going public. Things look difficult for the thousands of privately held (and mostly overvalued) unicorns.
Valuations are down and deal volume is also significantly down.
Late-stage funding rounds are rare. Those that are happening are often bridge rounds.
New fund managers are having serious trouble raising money.
There are some silver linings, at least for investors: the scarcity of capital is driving down valuations, meaning there are bargains around.
Interestingly, deal sizes aren’t dropping everywhere.
At seed, whilst volume has dropped significantly, median round size has actually increased.
However, as Pitchbook highlight, this data masks the fact that the bar for securing seed capital is now higher. Anecdotally, seed revenue multiples have fallen sharply, and investors have been advising founders to lower price expectations.
It seems like there is a flight to safety. There are a small number of hype rounds, usually into startups led by experienced founders. This keeps valuations high. Other businesses, meanwhile, struggle to raise at all.
Tough times.
But tough times make strong founders.
If you’re a founder and you’re raising, Odin can help you collect commitments from investors instantly (rather than at the point all the round docs are signed). We also allow you to leverage the power of your community, and bring in smaller cheque investors without messing up your cap table.
If you’re an angel investor or an emerging fund manager, you can support your founders by using Odin to syndicate capital from your network into an SPV. And there are more products for emerging managers on the horizon very soon ;-)
See you next week!
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Today’s AI-generated thumbnail art - “A YouTuber holding a sword in the recording studio, by Matisse” - Dall-E
Thanks to Niraj Dattani for helping me to tease this point out!