August 27, 2022
Image: Protocol; Anduril; 8VC; Palumni VC; Arena
Hello, and welcome to Pipeline. I’m Biz Carson, and this week I saw the revival of “Oklahoma!” on tour in SF, and it was the worst musical I’ve ever seen in my life. (My New York-based co-workers apparently disagree with this take.)
A quick housekeeping note: a special thank you to Veronica Irwin for filling in on Pipeline at LA Tech Week. Catch Veronica’s dispatch here if you missed it last week. Pipeline will be off next week for Labor Day, so I hope you all enjoy the long weekend. See you (virtually) at YC Demo Day when we’re back.
This week is a slow news week in the startup world: Better.com can’t get layoffs right, Adam Neumann’s next act is still all anyone can talk about and Palantir alumni have built their own network that I’m calling the Palantir Pack.
Tonight, a bunch of PayPal alumni will be gathering at Peter Thiel’s mansion in LA to celebrate the 20th anniversary of its IPO. It’s a well-known group thanks to an infamous Fortune magazine photo shoot of the PayPal Mafia and the network of startups and venture firms that have come from its founders and employees.
But PayPal isn’t the only mafia that Thiel is a part of. Thiel was one of the founders of Palantir, the data company that quietly (and sometimes controversially) built itself into a multibillion-dollar business. It’s been a shining example of the PayPal Mafia, but it’s spawned a network of its own thanks to the unique culture that contributed to the many successful startups and venture funds that emerged from it.
I’m calling it the Palantir Pack.
To be a successful “mafia” by tech standards, Keith Rabois once suggested to me that you need at least three unicorns to come out of it along with a distinct culture. Palantir meets those requirements and then some, and has several more potentially very valuable companies in the pipeline.
The Palantir Pack has followed a similar playbook to Palantir. The main twist is that Pack members have rethought Palantir’s trademark secrecy.
Unlike PayPal’s “mafia,” it’s still expanding. PayPal went public but then got acquired quickly, which caused an exodus of talent. Palantir still operates much like an engineering institute or SEAL Team Six for technical talent, said 8VC’s Moore. “Our group is more like the military or something where you give your tour of duty, now you’re really, really tired and need recuperation, and then you’re ready to ramp back up,” Moore said of alumni. “They need a year or two off and then they sort of wake up and call us back.”
Peter Thiel might be busy with his PayPal reunion tonight, but perhaps the next group to meet up will be the Palantir Pack. Just don’t underestimate the size of a party needed to cater to the founders and VCs that have spun out of it. Perhaps Palantir’s own software could measure the true scale of the network.For more on the Palantir Pack, read my deep dive into the characteristics of the network, some of the early days of the company and a longer list of companies included in the group.
“The biggest issue and my biggest regret is that it became a company,” Jack Dorsey said of Twitter this week. Not many founders would say this after building a billion-dollar business, but Dorsey wishes Twitter was instead a protocol not owned by the state or a company. (We like the idea of a Protocol, too!)
“This amount of capital feels like Quibi,” a Flow competitor told me. It was just one of the many things I heard this week from VCs and founders since Adam Neumann’s next act is still all anyone can talk about. Whether it was this week’s suggestion that Neumann could have a conflict of interest after backing a startup in a similar space or the fact that the check size felt like a slap in the face to DEI progress in tech, people are still outraged about the deal. “I was furious that time and time again, VCs invested in the same pattern that rewards toxic, growth-at-all-cost behavior and ineffective stewardship of capital," Pepper co-founder Jaclyn Fu told NPR. "It's wild that safe bets for VCs look more like Neumann with fanciful 'vision' versus founders who can actually prove product-market fit and real customer opportunity." Although two people I talked to this week wish they could’ve seen the deal. (If you’ve seen the term sheet, send it my way.)Word of the week: nimcel, or “niche internet micro celebrity.” Instead of aiming for all-out influencer status, there’s a growing group of internet celebrities that are well-known in their networks but not outside of it. If you need some help coming up with posts to become a nimcel, I’d recommend this amazing viral LinkedIn post generator, which is great at coming up with some truly cringey text.
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This week was a big one for advice on data rooms. A16z’s Justine Moore published a guide for founders on what they need to know to include before going out to fundraise. Venture capitalists also have to fundraise, but obviously their needs are a bit different. Paige Finn Doherty of Behind Genius published a Twitter thread on what her firm needed to raise its first fund.
A16z has Future. Redpoint now has Start. The firm launched its own content play, which is more about how to build companies (think MasterClass meets TikTok) but gives founders that advice via videos and not just long-form articles.
Female founders already carry a heavy burden, and the negative press coverage against some female CEOs can feel like an extra target, Coalition’s Ashley Mayer told Homebrew’s Hunter Walk. In an interview on her career in comms, she advises founders to navigate it. “I guess we’ll know we’ve made it when a woman can get away with behaving like Elon Musk,” she said.
The real unicorn in Silicon Valley: a startup considering an IPO. The WSJ reported that Instacart is still charting a path toward the public markets, and revenue has been growing (although it's nowhere near pandemic levels).
RIP Tiger Management founder Julian Robertson. The hedge fund pioneer was known not only for his own firm but also for mentoring the “Tiger Cubs” who came after him, like Tiger Global, Coatue, Lone Pine Capital and Maverick Capital.
Better.com hasn’t gotten better at layoffs. The company did a fourth round of layoffs after a list of employees who were going to be laid off leaked a few days early, according to TechCrunch.
Pivots: Speaking of pivots, Marc Bodnick’s Telepath is shutting down after attempting a kinder, interest-based social network. An email alerted me this week that the team is now building Wavelength, an encrypted group messaging app in private beta.
Next month’s hot ticket: a GOP fundraiser in Florida. Puck News was first to report that VCs Keith Rabois and David Sacks are going to host a “Take Back the Senate” event. On the invite list: Mehmet Oz, J.D. Vance, Blake Masters and Marco Rubio.
From Protocol: Pinterest is facing a civil rights investigation in California — and it’s not the only one under scrutiny, according to the company.
Also from Protocol: The biggest news of the week came from Twitter whistleblower Mudge. The 84-page complaint will not only throw a wrench in Twitter’s legal battle with Elon Musk, but it’s also a siren call for Washington to look much more closely at the company.Your weekend reading: A product sending people to the ER because they got so sick is any company’s nightmare. But somehow Daily Harvest’s response was allegedly worse than the food poisoning its customers endured, according to Fortune’s deep dive on the VC-backed company and some bad lentil crumbles.
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