Brian O'Kelley

What does it take for a startup to succeed in music-tech? More than Product-Market fit -- you also need Industry Market fit and Investor Market fit. I wrote about these patterns https://lnkd.in/gF4wBSfX

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The Neighborhood Studios team spent the last few days thinking about our new idea pipeline and its output. Tons of thoughts on this after being in a venture studio for 2 years. Here are some summary stats... - 1,750 new (raw) ideas considered per year. - 110 of those are given a second glance. - 66 of those are seriously considered. - 10 of those become experiments...real products in the hands of customers. - 2 of those are spun-out into studio companies. What the studio team has been discussing over the past few days is that 66 number. That's the number of ideas that 3 people on the team can dig into every year. Venture studios can be perceived as a "startup factory"...an engine to launch startups. The reality is that venture studios are a machine to invalidate ideas. We invalidate many more ideas than we validate. We touch 1,750 ideas per year, seriously dive into 66 of them, build experiments for 10 of them and only launch 2 of them. All that work turns into 2 studio companies per year that have a way higher success rate than the average startup in the wild. Said another way...startups are hard. Talk with Tapan Patel Gabe Hart Whit Anderson IV Jonathan Brinson if you wanna talk about this. They are world class.

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TV right now is wall-to-wall "mid." But why? I think a lot of pieces right now are missing the true culprit. For example, this James Poniewozik piece does a fantastic job of laying out what exactly that looks like: all-star casts and highly-competent direction, but familiar and low-stakes. Like a fancy cheeseburger. He, like most pieces on the subject, pins it on the streaming business model. I think there's something else going on that's different about TV today versus when people were glued to The Wire, The Sopranos, or Twin Peaks that goes deeper than the underlying business model. It's our second screen. When I talk to friends about what they're watching, a lot admit they can't watch foreign language TV, or stuff that's too complex, because they have their phone or laptop open. We’ve relegated TV to comfortable background noise. The streaming model gives people what they want, but what they overwhelmingly want is comfortable and mid, not because that's where their tastes lie if something has 100% of their attention. It's because they are calibrating their TV taste to what works for 40% of their attention. I don't have a solution, but I'm pretty sure that's the cause. I don't think Hollywood has lost its spark or financiers have lost their taste for risk. We've lost our taste for stuff that requires our full attention.

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UGC creators should be on red alert. UGC is turning AI-GC. We've been sharing our thoughts on AI disruption on Influencer Marketing, and predicted UGC was the most vulnerable category of the creator economy, the most susceptible to transformation. Now Techcrunch reports that TikTok will allow brands to create UGCs (more like AI GCs) with genAI. What does this mean for creators? What does this mean for brands and agencies? Will YouTube and IG follow? https://lnkd.in/dU-iPaBK

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At last week’s ClimateTech Coffee 🚲 Bryan White and I were joined by Kimberly Gilbert, PhD to hear about her work on Carbon Neutralization and Ocean Storage (CNOS) through her company pHathom. Here’s a recap: The ocean naturally absorbs CO2 over time, but we’ve added so much that the ocean has become increasingly acidic. Ocean pH has dropped from 8.2 to 8.1 globally over the last hundred years, and as pH drops it becomes harder for coral-based organisms to form shells. To combat this, Ocean Alkalinity Enhancement (OAE) is an intervention that both reverses ocean acidification and removes CO2 from the atmosphere. Challenges with traditional OAE: - When you add the alkalinity into the ocean, it spreads out. It’s hard to measure the change in pH. - You don’t know exactly when the extra CO2 will be absorbed. Modeling and measurement companies are trying to help with this problem. Advantages of CNOS: - Co2 is captured directly at a coastal power plant or refinery, and then the concentrated Co2 is pumped into water that has limestone (and/or other alkaline materials) in it.  - This means the Co2 is dissolved onsite and the pH can be equilibrated onsite, which makes accurate measurement more feasible. Factors that affect progress:  - We’ll start seeing more companies enter in this space as the chemistry and its impacts are better understood and seen as safe  - Local and national permitting are a huge bottleneck - On the international permitting level, the London Protocol has a blanket ban on ocean geoengineering for anything except for research. There were good reasons for doing that, but it’s unclear who decides when that can change and the circumstances under which the ban is lifted. (Note: pHathom is not doing geoengineering; it’s doing water treatment on-site and releasing it back as ocean water) Open questions for the category/technology: - Can they come up with enough low-cost alkalinity sources, and get them in a way that doesn’t cause additional environmental damage or Co2 emissions?  - This approach will require pumping a lot of water. How much will that cost and how can the cost be driven down?  - Putting 100 plants’ worth of bicarbonate into the ocean is likely fine for ocean health relative to the climate benefit, but what is the point where the tradeoffs cross over? Some groups doing good work in this space:  [C]Worthy Carbon to Sea Initiative  University Research: UC Santa Barbara, University of Tasmania, GEOMAR, Dalhousie University, Scripps Join us for the next one in May! Details coming soon, and you can get updates by subscribing to the series page here: https://lnkd.in/g7DTGm2V

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A really interesting and powerful performance management practice. "Use the “30-day test” to maintain a high-performance team. Create a reminder to ask yourself this question 30 days after someone joins the team: “Knowing what I know today, would I hire this person?” If the answer is yes, tell the person you’re excited about them and give them more equity—you’ll gain a lot of loyalty. If the answer is no, you need to fire them immediately, to avoid the inevitable damage they will cause to you, your team, and themselves." from Uri Levine Founder of Waze, via Lenny's podcast. https://lnkd.in/gyS2HzZP

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As creator economy platforms like Substack resegment the world of media, it’s no surprise that they turn more and more to video. The same thing happened to text-based media and journalism in the last century—as TV proliferated, media went from being mostly text-based to mostly video-based over time. Substack is interesting for so many reasons: - Empowering creators vs. centralized control. - More aligned incentives between platform and creator. - Giving writers and journalists stability in a time of industry upheaval. - Long-form, thoughtful content vs. dopamine addiction. Excited to be working with Chris Best, Hamish McKenzie, Jairaj Sethi on this.

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“The funding landscape has changed during the time we have been involved in it, and continues to evolve,” “And we’re evolving with it, to ensure that there is even more flexibility for companies to access the specific capital they need for a given scenario. We’ve funded well over 180 technology companies across multiple industries and verticals, and we’re not slowing down any time soon.” Regarding the total addressable market for Tractor to operate in, Imam explains that the one-funding-product-fits-all approach has required tweaking, simply due to the totally different needs expressed by the financial decision-makers, related to time, total access to the capital itself, and looming milestones that require a more strategic approach to accessing capital. “If you’re a SaaS company, or an ecommerce company, or a hardware company, or operating in a particular niche or vertical like marketing tech for example, you will have a different set of needs for funding based on your revenue,” explains Imam. “We’ve moved to a scenario-based funding model, based on the most common queries we receive at this point in time. B2B Enterprise SaaS we will always be able to fund in an instant. Other scenarios arise when the financials require a bit more flexible and bespoke assessment.” “In particular, our Inventory product points to our capability to fund in some very very specific and founder-focussed ways, and that flexibility really excites us, now and for the future.” Thank you for this write up SmartCompany!

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I’ve found myself having a lot of conversations about AI with media companies and creators for the past several weeks. From publishers considering licensing to LLMs to content creators thinking about how different tools might enhance workflows or creative output, my overwhelming sense is that we’ve reached a moment of mass confusion in media. For media companies (from individuals to conglomerates), there is a cascade of questions. Will the output of a model one day destroy my business? Should I wait for a legal or regulatory response? Should I be dealing with these companies? And even if I wanted to, has the ship sailed and it’s now too late? I’ve been surprised by the consistency of questions across companies with different businesses, and in different verticals and sectors. The answer that comes up most is we just don’t know. And as a savvy media exec said recently to me, we need to have a good umbrella instead of just shouting at the rain. Across all this uncertainty, one thing remains clear: as AI becomes more a part of our lives, audiences, readers, and fans are going to be increasingly seeking craft, meaning, and connection. These are things that LLMs can’t quite replicate and as a mass of AI generated content floods the zone of our distribution networks, how will we find these vital and necessary values from the scarcity of authentic stories, information, and entertainment that we turn to? Well, we just don’t know. But, we do know that GenAI platforms need to understand the concerns and realities of creative work and the anxieties very much at play. At the same time, media companies and creators need to find the opportunities to use these tools to deepen their connections and refine their craft. Both are challenges, but there is opportunity if we look for the the creative tools that will enhance and enrich but not replace the people best equipped to be crafting the next generation of creative, meaningful work.

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Today is a great day for the future of digital marketing in the world, as Ibotta, Inc. founded by Bryan Leach raised $577 million in IPO. Every founder has some inspirations. David Vélez had Capital One as one of his inspirations for Nubank. Being a much more mature market for entrepreneurship and innovation, the US has several benchmarks for Brazilian startups. As someone encounters a problem worth solving in our country, it is natural and wise to think someone else might be actively tackling the same problem elsewhere, as the timing of our market is different. Ibotta, Inc.'s IPO represents a bright moment for everyone who believes and foresees that first-party data players are the next generation of digital marketing, consumer insights and loyalty. By the end of 2024, Google is shutting down third-party cookies on Google Chrome to adapt its policies to GDPR. Chrome has 75% of market share and this completely changes the dynamics of the market. Brands have no option: in order to create better audiences for their marketing campaigns, they must partner with players which can access behavioral data in different ways. I have been lucky enough to have had some 1:1 lunches with David Vélez in the early days of Nubank and I never forget some of his words: "when it comes to disruption opportunities, if you ever find a market that could not have access to data at scale because simply there was no technology to make it happen, by the time the technology is ready, you have your window of opportunity". In other words, he was explaining to me the concept of "why now" for a startup thesis. In Brazil, there are QR codes on purchase receipts that made the tech side of our thesis possible, allowing us to extract the data. The cookieless era is the cultural shift in the market we needed in order for brands to push the demand for a product like ours forward. Well done, Ibotta, Inc.! Your resilience and journey inspires us all. Let's get back to work. Link to the news: https://lnkd.in/dnfaMR9b #startups #digitalmarketing #ipo #exits

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Dude Perfect raised $100M for global biz expansion. The deal is getting lots of buzz, but our team’s math signals challenges ahead. Let’s break it down… DEAL DETAILS • $100 - 300M growth capital investment • Led by Highmount Capital • Unclear if 100% invested upfront OR draw down of commitment over time • No previous capital raised USE OF FUNDS • Hire mgmt team to expand biz • More live experiences incl int’l tour, consumer products • Grow content formats, frequency, channels, global localization e.g. animation, TV, movies, streaming • Extend brand beyond 5 founders by building talent network • New HQ in Frisco, TX as prod facility and “family-friendly entertainment destination”: – Retail store, podcasts / gaming / fan UGC spaces, trick shot tower, DP museum, mini golf, restaurants – Original plans for 3-story, 30 acre facility est to cost $100M+, 2 yrs to build COMPANY OVERVIEW: Dude Perfect • Digital-native comedy and sports media brand • Faith-based mission: “We’re about giving back, spreading joy and glorifying Jesus Christ”  • Other YouTube franchises: “Stereotypes,” “Overtime”, “Bucket List”  • Media brand also incl books, mobile games, board games and toys, and merch / retail / food and beverage partnerships • 25 current team members PERFORMANCE HIGHLIGHTS • 60M YouTube Followers, 17B views • Est 2024 revenue: $50M per DP • Est 2023 and 2022 revenue: $25M and $20M per WSJ  • Consumer product partnerships incl Nerf toy line, Columbia Sportswear • Partnered with A Parent Media co to launch a streaming service • ESPN “30 for 30” doc premiering at Dallas Int’l film festival • TV series on CMT in 2016, later aired on Nickelodeon • Alternate broadcasts for Amazon’s Thursday Night Football • 4 live nationwide tours as of 2023 ORIGIN STORY • Founded 2009 by 5 friends at Texas A&M • Cofounders = twins Coby Cotton and Cory Cotton, Tyler Toney, Cody Jones, Garrett Hilbert • Started as YT channel featuring trick shot videos INVESTOR OVERVIEW: Highmount Capital • Growth stage and middle mkt PE fund for tech, media, healthcare • Founded in 2023 by jason illian and David Hawkins • 4 team members on website + advisor • 3 team members have faith-based ties per bios • No other investments listed on website other than DP My takeaway... I really like and support the trend of increased investment into YouTubers and digital-native media brands. But as I wrote about in my 2024 State of Creator x Media capital markets reports (will link them below), investment must match market and opportunity size. To ensure good ROI, and to set good precedent for future investment into our space. The DP bet is exciting, but could be overly optimistic based on our prelim math. My colleague Michael Booth's post breaks the math down (link below). More analysis to come in my Friday newsletter. —- I’m the founder of RockWater Industries. We do m&a and strategy advisory for media, agencies, and creator economy. My dm’s are open. #media #agency #creatoreconomy

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Prime Coalition has long taken a different tack to climate finance compared to its for-profit brethren. It makes the usual venture-style investments in startups through Azolla Ventures and also helps philanthropists direct their money to climate-related projects that it deems high impact. Trellis Climate follows the latter model with a focus on middle stages, where capital has grown scarce. #climatetech #climateVC #climatefinance

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Last year I put together as comprehensive of a list as I could of every single active venture backed startup in Boston over the last 5+ years. Very useful exercise! ...very difficult to maintain. Friends of LinkedIn - do you know of a tool that can automatically & publicly update this table for me weekly to keep the people of Boston informed of their venture backed population? I will highlight the tool on the page to the hundreds (soon thousands) of people that view it every month! Link to the manual version here: https://lnkd.in/ek9wSfUD The AI should also be able to answer this question: Which weighs more? A pound of bricks or a pound of feathers? Happy Friday to you!

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Where can a large PE fund write a $100-150M check into the creator economy, and get good ROI? That’s a question I’m hearing more and more often. I have some ideas, but honestly I think that’s a challenging proposition at this stage of the market. It’s prompted me to repost my analysis of creator x media fundraisings. 👉🏼 https://lnkd.in/gF3EJSEY What do you think? Where can a check of that size solve a market problem, and generate good return? — I’m the founder of RockWater Industries. We do m&a and strategy advisory for media, agencies, and crestor economy. My DMs are open.

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🚀 Permira's Month of Billions-Dollar Acquisitions! 🚀 In a remarkable and rare occurrence, Permira has announced not one, but two major acquisitions within a single month, each with billion-dollar valuations. This impressive feat underscores Permira's strategic vision and robust capability in managing concurrent due diligences and executing high-value deals. 1. Permira to Acquire Majority Position in BioCatch at $1.3 Billion Valuation 📅 New York and Tel Aviv, May 2nd, 2024 BioCatch, a leader in behavioral biometrics, will now join the Permira portfolio. This acquisition emphasizes the growing importance of cybersecurity and fraud prevention technologies in our digital world. 2. Permira to Take Squarespace Private in a $6.9 Billion Deal 📅 May 13th, 2024 Permira is set to take Squarespace, a prominent platform for website building and hosting, private. This strategic move is aimed at enhancing Permira’s digital and e-commerce portfolio, driving significant growth and new opportunities for both entities. Executing two billions-dollar M&A transactions in such a short timeframe is a testament to Permira’s dedication and expertise in the investment landscape. Managing concurrent due-diligences and ensuring successful outcomes showcases Permira's thorough approach and strategic acumen. #Permira , #BioCatch , #Squarespace , #Innovation , #Technology , #DigitalTransformation , #MergersAndAcquisitions , #Cybersecurity , #ECommerce , #Growth , #Investments , #Acquisitions , #BusinessGrowth , #MandAmarket , #Mergers , #BusinessNews https://lnkd.in/eKgUhq_D https://lnkd.in/e6Rnku35

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It’s one thing to go to events in DTC and e-comm, it’s another to fully take advantage of them. Here are my two main takeaways from the conversations I had at Shoptalk in Vegas: 1) Meeting/chatting in person is key to deepening relationships. I had the opportunity to meet customers, partners, and even Prive team members for the first time in person while at the event. Chatting in person helped us bond and understand each other better, which holds a lot of value. It was also cool to see that even in a very competitive market, people are still genuinely kind and friendly. It might seem from the outside that competitors should dislike each other, but I saw first-hand at ShopTalk that we’re all in this together and can still be kind to one another in the process. 2. Strong partnerships are something more brands are looking for. When talking with brand founders, the one big thing a lot of them mentioned was the desire for a strong partnership with every company they work with. Many people shared that they were left unsupported with tools/tech after buying them — this underscored the value of our approach at Prive. We prioritize a partnership mentality, offering whatever help our customers need post-onboarding. For a lot of brands and industry leaders, the emphasis is on the quality of partnership, not just the product features. Overall, ShopTalk was a blast and it was great getting to chat with every single one of you. If you were there — do you feel a similar way?

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“People need to eat – apps don’t,” states Evan Alcala, an entrepreneur based in Los Angeles. TriYum couldn’t have come at a better time. The app offers a number of solutions to a wide variety of bigger problems. The struggle in the food delivery app industry is real. In mid-February, food delivery app drivers, along with on-demand app drivers, went on strike in cities across the USA and Canada, demanding better pay and better work conditions. To top it all off, restaurants in cities everywhere are now being more vocal than ever before, calling third-party delivery apps a disadvantage with their high commission fees. Many restaurants now even contend that most food delivery apps are hampering their businesses on many levels: loss of brand identity, less control over customer experience, data ownership issues, and reduced customer loyalty. Customers too, like food establishments, are also getting fed up with all the hidden fees. TriYum however will be a game-changer in the food delivery app industry, which is expected to reach $165 billion market size by 2029. The new app will offer subscription-based fees for both restaurants and drivers, and customers will be billed with a flat-rate delivery fee. The app will not include any hidden fees. Customers will also receive “true” restaurant pricing. #app #fooddelivery #innovation #eat #employment https://lnkd.in/g4Zx48j3

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𝐓𝐡𝐞 𝐬𝐢𝐥𝐯𝐞𝐫 𝐥𝐢𝐧𝐢𝐧𝐠 𝐨𝐟 𝐚 𝐟𝐚𝐢𝐥𝐞𝐝 𝐝𝐞𝐦𝐨 This past Monday, I had the incredible opportunity to demo and pitch Jammy to over 100 investors at NY #TechWeek AI Demo Day. Two weeks ago, thanks to Cindy Berman, I found out about the event and hesitated to sign up, doubting our product’s readiness. However, I saw it as a chance to push our limits. After a screening with Shriya Nevatia we were one of eight companies chosen, and I had to figure out how to demo our work-in-progress app and deliver an eight-minute pitch. I prepared thoroughly and felt confident. On the day, Dorothy Chang informed me I’d be the first presenter, which made me both nervous and excited. The pitch went well until the live demo. When showcasing Jammy’s ability to recommend post-session music, the integration failed despite my preparation. I still finished the presentation, landing the vision for Jammy and with congratulations and consolation from my peers: “live demos always break,” they said. It helped. Though I didn’t win the $50K prize, I secured a check from an angel investor, generated interest from several others, and met amazing founders in AI. The winning pitch went to the highly deserving CAPSULE, who is set to revolutionize contextual visual shopping search (like Shazam for shopping). Very cool. This experience highlighted the value of taking risks and the importance of failing forward. It also reminded me of the supportive NY Tech and entrepreneurial community. The journey can be lonely, and many dismiss community events and networking as distractions from the "real work." While that might sometimes be true, Monday night was a reminder that we’re not alone in this journey. We all want to see each other succeed in building the - extremely AI-infused - future we envision. On to the next challenge! And definitely check out these amazing companies & founders: Glist, Gülin Yilmaz (Posokhow), Path, Soar.com, Abood Hannoon, DeepLeads.ai, pre.dev, and In The Loop

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INTERVIEWS OF 2024 SXSW PITCH WINNERS: Dhavel Patel of Lotus Every March in Austin, 50 of the world's most impactful startups showcase their talents at SXSW Pitch. Today we begin a series of short interviews with some of the category winners from the 2024 event. Founder and CEO Dhaval Patel has been growing Lotus for three years. At this year's SXSW Pitch, his San Jose based startup emerged as the winner of the "Smart Cities, Transportation & Sustainability" category. Patel's short answers to our questions are below. SXSW: What is Lotus?  Patel: A wearable ring that controls objects at home by pointing. See https://www.getlotus.com/ SXSW: What community does Lotus serve? Patel: Folks with limited mobility -- older adults, veteran soldiers, people with disabilities.  SXSW: Who is your all-time favorite entrepreneur? Patel: Warren Buffett. SXSW: Best startup-related advice you have received? Patel: Don't start building first, find the need first. SXSW: Current entrepreneurial trend that excites you the most? Patel: Desire for tech that is intuitive and simple. SXSW: Fail fast or perseverance? Patel: Persevere in failing fast repeatedly. SXSW: Favorite VC? Patel: Andreessen Horowitz. SXSW: Favorite gadget or device? Patel: Apple AirPods. SXSW: Government can best support startups by Patel: Moving faster. SXSW: Most over-hyped technology at present? Patel: AI. SXSW: Most under-hyped technology at present? Patel: Consumer hardware. SXSW: What did you enjoy most about your experience at SXSW? Patel: The people -- each person wanting to make the world a better place. SXSW: What is your best trait as an entrepreneur? Patel: Simplifying complex problems. SXSW: What is your best advice for other startups? Patel: Focus (say "no" to more). Learn more about Dhaval Patel of Lotus plus other 2024 SXSW Pitch winners by listening to the audio of their session at this year's event. See https://lnkd.in/gHtwQB8n Applications for SXSW Pitch 2025 will open in late summer. See https://lnkd.in/gE2hcVPK #sxsw, #sxsw2024, #startups, #founders, Chris Valentine, Dhaval Patel, SXSW, #venturecapital, #entrepreneur, #entrepreneurs, #startup, #founderstories, #sxswpitch, Lotus (Techstars'23), #techstars, #Austin, #ATX, #creativity, #innovation, #hardware, #consumerhardware, #pitch, #accessibility,

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