July 11, 2020
Photo: David Paul Morris/Bloomberg via Getty Images
Hello and welcome to Pipeline.This week: SPAC secrets, email chain pitches, and a 2011 holiday party that people are still talking about.If you were forwarded this email, be sure to sign up here.
In March, online car sales startup Shift was in a precarious position. Its founder and co-CEO George Arison had to cut employees' pay and furlough many of them as he forecasted a revenue plunge.
Now Shift has swung from furloughs to going public by the end of the quarter. And that's thanks to a SPAC.
One reason companies like SPACs? They're often a faster route to going public — something important to a company like Shift that was looking to get a deal done.
It could also mean a bigger payout for Shift compared to a traditional IPO, Arison said.
If plans stay on track, Shift should be publicly traded by the end of the quarter. Looking back, Arison says it feels more like three years have passed instead of just four months.
What's one of your new quarantine habits?
Giving my sweet, adorable young children the Heisman as they repeatedly seek to violate my Zoom space during work calls. The first several hundred times were precious, but, um, hello … boundaries?
What's one startup that failed or was shut down that you wish was still here today?
Kozmo.com. Where else could you get $3.99 toothpaste at 9 p.m. with a free T-shirt and a hot chocolate-chip cookie? And then an hour later get a $1 bottle of water with another free T-shirt and cookie? Of course they went bust, but ahh, those were the days.
What's your favorite piece of advice to give to first-time founders?
Do your best to maintain balance and manage the high highs and low lows. It's never as good as it seems nor as bleak as you may feel.
What's one of the worst predictions you've ever made?
I confidently told a New York Times reporter that Facebook was absurdly overvalued at $50 billion when Goldman Sachs made a $450 million investment. Whoops. Fortunately that particular quote was left on the cutting room floor.
What's a startup area that's over-hyped right now? What's under-hyped?
Over-hyped: The new breed of VC-backed insurance companies (seeking tech multiples) strikes me as overblown given [the] industry structure and federally regulated reserves.
Under-hyped: The transformation of the American workforce from the surging wave of automation (physical via robotics, digital via AI/ML). If the rise of Trump is due in part to the revolt from the working class suffering from global trade and manufacturing automation, what will the vulnerability of the white collar professionals (whose jobs are being increasingly taken by machines) lead to?
Clarification: This article was updated to change the language relating to changes to Shift employees' pay. Updated July 11.