August 15, 2020
Image: Vladimir Belochhkin and Protocol
Hello and welcome to Pipeline. This week: Trouble inside Talkspace, the VC that's trying to work his Trump connections to save TikTok, and what happened to Y Combinator's W20 batch that launched right into the pandemic.
If you were forwarded this email, be sure to sign up here.
Do you remember where you were on March 16? It was the worst single-day point drop in the Dow's history and also the day that San Francisco was ordered to start sheltering in place. For me, I was at the UCSF hospital with an inconclusively fractured elbow that could only be diagnosed with more testing — if the hospital wasn't locking down thanks to COVID-19.
But for 500 entrepreneurs, the day marked something very different, although maybe just as painful. March 16 was Y Combinator's Winter 20 cohort's Demo Day. Normally a celebratory launch pad for up-and-coming startups and a FOMO-inducing investor schmoozefest, the Demo Day had already been moved online, becoming a list of companies and one-page slides, and pulled forward by an entire week.
Five months later, I was curious about the companies in the class and how they did launching straight into the pandemic. After talking to over 20 founders and investors, I published a story Friday on Protocol about how COVID-19 rewrote Y Combinator's W20 Demo Day — and the checks investors were writing, too.
Turns out that moving Demo Day forward a week was a good call. YC had told founders to go out and raise quickly ahead of Demo Day — the opposite of their usual advice — and the founders who heeded that ended up having an easier time raising than those who waited until afterward.
One thing COVID hasn't yet changed: YC's power. That's something that really stood out to me during the reporting process but didn't make it into my article, so I thought I'd dive into it a little more here.
With YC's Summer Demo Day just around the corner — mark your calendars for Aug. 24 and 25 — I'll be curious to see how different the experience will be for this class.
During the 2020 national political conventions, Protocol will host a two-event series on the tech and policy needed to enable a diverse future workforce and a strong economy. Join us at noon ET on Wednesday for the first event in the series, hosted in partnership with ITI.
What's an idea you wish you had first?
TikTok, given that my first startup as a founder, VXtreme (acquired by Microsoft), pioneered the use of streaming video back in the mid '90s. Plus, I would look so cool to my kids.
What was your first check?
While at Microsoft (post the acquisition of VXtreme), I led the investment in Akamai. I saw that the internet would require a new content delivery network that would enable high-quality streaming video and content-rich websites.
What's your favorite piece of advice to give to first-time founders?
Startups die of indigestion, not starvation. I'm a huge fan of focus both in terms of priorities and concentration. While we are not traveling these days, one product I love are Sennheiser noise-canceling headphones as they help me be productive on long flights.
What's one of the worst predictions you've ever made?
[The] rise of VDI (virtual desktops) in 2008-2009 before the iPad came into action. I invested in a company that did not make it along with many others that failed — hundreds of millions of VC dollars were invested in the space that were all lost. A huge silver lining was that the founder of that company, Aly Orady, came to Mayfield as an EIR and went on to found a consumer fitness company, Tonal, where we were the seed and series A investors.
What product or service are you totally, even irrationally, loyal to?
Willow Cricket. I sacrifice a lot of sleep to stay up and watch cricket matches live from all around the world!