The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 55 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Jordan: Amazon was the only profitable e-commerce business due to low defensibility
“Early on, I was a big proponent of that e-commerce was going to clean the clock of the department stores. I got the thesis half right. Share did shift. No one could make money other than Amazon because of there's just no defensibility, no barriers to entry.”
Jordan: a16z Avoids Investing in Startups Reliant on Paid Marketing
“I am reluctant to invest in companies that, that require heavy paid marketing to build their audience.”
Jordan: TikTok Buys Users at Scale Unlike Early Google or Facebook
“That's not a categorical rule, because TikTok buys users at monstrous scale. But, you know, Google really didn't buy many users, Facebook didn't buy many users, you know, tick, tick, tick, tick.”
Jordan: a16z Avoided Fast Commerce, Viewing It as a Kozmo Redo
“We didn't make a bet in in fast commerce. That's one word that some of us internet veterans remember Cosmo and, you know, our concern was it's Cosmo redo redo without anything really new. On top of it. So we did not place a bet in that in that sector.”
Jordan: Demand Is the Primary Strategic Side in Two-Sided Marketplaces
“I have a belief that the demand side is, you know, kind of the, is the more, more strategic side because suppliers typically will go wherever the demand is. And so for me, keeping a healthy demand Bucket, you know, is what your suppliers are looking for.”
Jordan: Home Service Marketplaces Fail Due to Low Frequency and Leakage
“I think there is a real issue with leakage. The other is a issue with frequency except for lawn care and home cleaning. Almost all services are very, very infrequent and it's, it was very hard to build a brand.”
Jordan: Reluctant to invest in startups relying on paid marketing
“So I am reluctant to invest in companies that, that require heavy paid marketing to build their audience. You know, the best Concepts typically don't need, you know, they're so compelling, they don't need to buy users.”
Jordan: Incredible Health could have gone from Series A to IPO
“Iman at Incredible had the just had this dream of, she called it A to IPO. She arguably could have never raised a B round and gone public. The business has that kind of momentum. And because she was quote unquote accidentally profitable, the bookings came in w…”
a16z does not base investment decisions on current market size
“We strive as a firm not to base investment decisions on current market size, because a lot of the best businesses created new markets to create new markets.”
Jeff Jordan: Top e-commerce investments like Fanatics generated uninspiring returns
“And I actually got two of the best e-commerce companies out there, fanatics and Zulu and it still is an uninspiring outcome.”
Jordan: a16z passed on fast commerce, viewing it as Kozmo.com 2.0
“We didn't make a bet in in fast Fast commerce. That's one word. Some of us internet veterans remember Cosmo and... Our concern was it's Cosmo redo, redo without anything really new on top of it. So we did not place a bet in that in that sector.”
Jordan: Instacart lost $20-$25 per order when a16z first invested
“From recollection, they were billing something like 10 or 12 dollars per order when we invested, and they were losing 20, 25 dollars per order on each one”
Jordan: A Month-Long Venture Fundraising Window Signals Startup Struggle
“And if it's a month, it's often an adverse signal. So it's, you know, that they can't raise.”
Jordan: VC-Founder Misalignment Stems from VC Portfolio Risk Dynamics
“I think the biggest one is VCs have a portfolio and the founders have N of one. And so, yeah, I try to be very explicit on that. You know, the founder says, okay, I have a fork in the road. You know, what, which, what's your point of view on where I should go?…”
Jordan: Aggregated Fragmented Marketplaces Are Brutally Hard to Compete With
“And so it was brutally hard to aggregate, but once you're aggregated, you know, it's brutally hard to compete with it. And no supplier has supplier power.”
Jordan: Local Marketplaces Reach a Tipping Point at 10% Supply
“There was a tipping point in each market. It's something like 10% of the target market supply where diners finally said, okay, this is so much more convenient than calling a restaurant one at a time, getting put on hold, getting voicemail, getting all this and…”
Jordan: Most Successful Marketplaces Are Permanently Supply-Constrained
“Most markets, even successful marketplaces typically are supply constrained. You know, Airbnb always is looking for new supply to enhance the user experience.”
Jordan: Owning Supply in Two-Sided Marketplaces Creates Channel Conflict
“You know, I think it's pretty hard to do that on, you know, on, on two-sided marketplaces, just because of channel conflict.”
Jordan: Instacart Avoids Owning Grocery Inventory to Preserve Partner Trust
“That channel conflict is something that Instacart has no desire to do. They want to be the go to partner for the for the gross, the physical grocer.”
Jordan: Amazon Was the Only Profitable Direct E-Commerce Company
“No one could make money other than Amazon because of there's just no defensibility, no barriers to entry.”
Jordan: a16z Advises Portfolio Startups to Delay Fundraising as Long as Possible
“You know, we're today counseling our businesses, try to be try not to need to go to market for as long as you sustainably can without hurting the business.”
Jordan: Airbnb Was Cashflow Positive Early Due to Upfront Payments
“Airbnb raised way less money than, you know, the other leading marketplaces at the time. It's got a couple of characteristics and that are very nice. One of which is they get paid in advance. And so, you know, when you make your summer vacation over the holida…”
Jordan: Incredible Health Had More Cash Pre-Series B Than Post-Series A
“Incredible health went you know, we did the a, they went three years without raising while the business was going very well. And when Iman finally did raise earlier this year. She had more cash in the bank when she raised than she did when after we funded her.”
Jordan: Instacart Lost 75% of Early Users but Held 100% Revenue Retention
“A year out, you know, the number of users declined something like three quarters But the users that stayed spent you know, three or four times more money. So their cohorts were actually on revenue basis were, you know, close to staying at 100%.”
Jordan: Instacart Lost $20 to $25 Per Order When a16z Invested
“When I, from recollection, they were billing something like 10 or 12 dollars per order when we invested and they were losing 20, 25 dollars per order on each one.”
Jordan: CACs Always Rise at Scale, Making Low LTV/CAC Dangerous
“The concern I have on CACs is they typically go up in my experience as you try to scale the acquisition. And, you know, part of that could be competitive dynamics. If you're paying, you know, your, the 10 mattress in a box customers trying to buy the, find the…”
Jeff Jordan: Board members should not prescribe decisions to founders
“You know, I try never to be prescriptive. You should do this. I try to say in my experience, I faced something similar. I tried A, B and C and here's what happened. But you know, just, I don't want the entrepreneur to do what I say because Then, you know, I'm …”
Jordan: Aggregating fragmented supply creates defensible marketplace moats
“Open table by contrast had, you know, the target market was 30 or 40 or 50,000 restaurants, almost all of which were the, had one, the owner only managed one restaurant. And so it was brutally hard to aggregate, but once you're aggregated, you know, it's bruta…”
Jordan: OpenTable hit geographic tipping point at 10% supply capture
“It's something like 10% of the target market supply where diners finally said, okay, this is so much more convenient than calling a restaurant one at a time, getting put on hold, getting voicemail, getting all this and that. So I would, I'm going to forego the…”
Jordan: Instacart avoids dark warehouses to prevent channel conflict with grocers
“But at that point you're competing with your customer and, you know, that channel conflict is something that Instacart has no desire to do. They want to be the go to partner for the for the gross, the physical grocer.”
Jordan: Upfront customer payments made Airbnb cash flow positive early
“Airbnb raised way less money than, you know, the other leading marketplaces at the time. It's got a couple of characteristics and that are very nice. One of which is they get paid in advance. And so, you know, when you make your summer vacation over the holida…”
Jordan: Best marketplace growth strategy is enabling organic user behavior
“The most successful growth strategy we had back in the day was just look what people were listing. And then try to enable it to be found on a much more systemic basis.”
Jordan: Instacart lost 75% of users yearly, but remaining users spent 3-4x
“In the case of Instacart the number of users declined pretty precipitously from, you know, first purchase to, you know, 10 purchase a year out, you know, they, the number of users declined something like three quarters. But the users that stayed spent you know…”
Jordan: Instacart reached significant profitability through process optimizations
“Each of those took, you know, many minutes off of each order, and, you know, time is money, and so, you know, that's just the example of the kind of continuous optimizations they were making, trying to get, take minutes and seconds out of the process, and in d…”
Jordan: Unbundling Craigslist for home services fails due to low frequency
“I think there is a real issue with leakage. The other is a issue with frequency except for lawn care and home cleaning. Almost all services are very, very infrequent and it's, it was very hard to build a brand.”
Jordan: A 50% success rate makes great VCs but fired operators
“You're a spectacular investor of half your companies create, you know, create value, which means half your companies don't create value, and that hit rate If you're batting 500 as an operator, you're an ex-operator.”
Jeff Jordan passed on early DoorDash investment over defensibility concerns
“The biggest miss I think was I had an opportunity to do DoorDash early and I loved Tony as a founder. I had the theory, a thesis on the food delivery market that you shouldn't, there's no defensible barrier to entry”
Jordan: a16z Invested in Incredible Health at a $60M Post-Money Valuation
“When you raise at 1.65 billion, I think our round was 60 post. You know, you are, you're not taking a lot of dilution.”
Jordan: a16z Avoids Basing Investment Decisions on Current Market Size
“We strive as a firm not to base investment decisions on current market size, because a lot of the best businesses created new markets to create new markets.”
Jordan: Startups Must Separate Experimental Marketing Budgets From Core Acquisition
“I love the companies that have, they segregate an experimental budget from their core, core acquisition budget, just to, because if you bundle them together, it is a barrier against experimentation. If you're constantly optimizing Google and Facebook, but you'…”
Jordan: Investing strategy centers almost exclusively on network effects
“And largely as an investor, I'm a kind of a one trick pony. Everything I would like to talk about as an operator and an investor typically involves a network effect.”
Jordan: OpenTable scaled via a 'come for tools, stay for network' model
“Open table is pretty interesting because it was a long slog before it became an overnight success because aggregating supply did take time. It was a classic come for the tools, stay for the network. Play.”
Jordan: Onboarding premier supply builds instant marketplace credibility
“We typically try to go to the very best restaurants and work our way down, so if French laundry's on there. You can't book it, but it's on there. You know, that, that gave some credibility”
Jeff Jordan: Most successful marketplaces are perpetually supply-constrained
“Most markets, even successful marketplaces typically are supply constrained.”
Jordan: a16z advises portfolio startups to delay raising capital
“We're today counseling our businesses, try to be try not to need to go to market for as long as you sustainably can without hurting the business.”
Jordan: a16z invested in Incredible Health at $60M valuation
“When you raise at 1.65 billion, I think our round was 60 post. You know, you are, you're not taking a lot of dilution.”
eBay's original business plan and Benchmark investment focused solely on collectibles
“Jeff Skoll wrote the business plan for eBay with Pierre. And I got a copy of it when I joined the business and they were focused entirely on the collectibles market. Now their argument was collectibles market in in the U S I think was a hundred, you know, it w…”
Jordan: Startups must separate experimental marketing budgets from core spend
“I love the companies that have a, they segregate an experimental budget from their core, core acquisition budget, just to, because if you bundle them together, it, It's a barrier against experimentation. If you're constantly optimizing Google and Facebook, but…”