Jake Chapman 🇺🇸🚀 ✨🇺🇸

I wonder how much venture capital subsidies lead to the underpricing of geopolitical risk. Classic externality and moral hazard problem. Worse for an early stage business and even worse in a frothy capital market or context. YC probably exacerbates in the short term for its batch companies.

I've gotten a lot of reach-outs from ocean founders in response to this tweet (LFG!) I'd say ~80% of founders were building some deep-sea solution for a defense application. I'm not sure if this says more about the ocean, or more about the defense bubble we're in (for the record, I don't invest in defense)

Bernie Sanders did no planting.

I wonder how much venture capital subsidies lead to the underpricing of geopolitical risk. Classic externality and moral hazard problem. Worse for an early stage business and even worse in a frothy capital market or context. YC probably exacerbates in the short term for its batch companies.

Antipatterns are a central feature of venture capital. They are superficially appealing heuristics which destroy performance by trading "uncertain but right" for "confident and wrong". This is true for early-stage investments and for an LP selecting new managers; any environment with complex qualitative judgements and professional insecurity. Three antipatterns show up repeatedly when LPs evaluate emerging managers: 1) GP Profile LPs routinely overweight credentials and demographic variables when selecting managers, which translates to lowering the bar for certain profiles. Essentially, the closer a manager is to the Stanford MBA Patagonia-vest-wearing archetype, the more easily they can raise a fund. Unfortunately, these traits have, at best, no relationship with performance. On the other hand, managers with unconventional backgrounds may outperform, but are routinely held to a higher standard or overlooked entirely. 2) Early Performance Metrics In a vacuum of information, LPs like to see early markups to indicate performance. In reality, rapid NAV growth is associated with consensus, manipulation and overcapitalisation, not better outcomes. This has been documented across multiple studies as the "n-curve" (rather than the typical "j-curve"), where positions are inflated around GP fundraising events, and fall afterwards. Similar to the fallacy of "kingmaking", it is silly to believe that rapid early markups are predictive of stronger exits rather than a reflection of market heat. 3) Founder NPS "Founder friendly" is a loaded term, and many firms will bend over backwards in performative displays of what they'll do for founders. Increasingly, this manifests as overlooking or even encouraging misbehaviour that might burn the founder later on. Anything to accelerate top-line growth, markups, and (more often) cash from secondaries. On the other hand, VCs that take an active role with monitoring portfolio companies appear to produce a better rate of exits, which might explain one observed inverse relationship between DPI and NPS. Ultimately, superficial signals offer comfort and defensibility in the short-term through a trade-off that weakens results in the long-term. There is no substitute for understanding the complex idiosyncrasies of an opportunity, whether it's a pre-seed founder or a debut fund.

😂 This “Nakba Survivor” is literally a “European settler” In the late 19th century, Muslim Bosnians (including Inea’s grandparents), fled Bosnia to Ottoman Syria, after Austria-Hungary took control of Bosnia. They feared that now, the Christians will seek revenge after years of mistreatment. Inea’s father’s family lived in Tulkaram, but he himself lived in Jerusalem where Inea was born. In the 1930’s, Inea’s father had a Job in England, he returned to Mandatory Palestine after a few years, but in 1948 they decided to move back to England. They were not expelled, and no one forced them to move to England. As a matter of fact, Tulkaram, and the old city of Jerusalem remained under Jordanian Arab control. Not a single Zionist to bee seen there. So in summary, this is a European with no strong roots in the land of Israel, whose family made the decision to immigrate back to the continent of their grandparents instead of remaining under Arab control. (And the “visit Palestine” poster on her wall is a Zionist poster by Franz Kraus to encourage Zionist tourism to the holy land. It’s not even the original poster, but a replica of the poster, with an additional Hebrew description mentioning his name 🤦‍♂️)

This real-time 1948 article from The Economist completely destroys the modern “Nakba” narrative that was invented decades later as political propaganda. Straight from British eyewitnesses in Haifa, October 2, 1948: “Jewish authorities urged all Arabs to remain in Haifa and guaranteed them protection and security ... However, of the 62,000 Arabs who formerly lived in Haifa, not more than 5,000 or 6,000 remained. The most potent factor was the announcements made over the air by the Arab Higher Executive, urging the Arabs to quit ... those who remained and accepted Jewish protection would be regarded as renegades.” They didn’t flee because of “Zionist ethnic cleansing.” They fled because Arab leaders ordered them to get out of the way so their armies could “drive the Jews into the sea.” Then they lost the war they started — and spent the next 77 years rewriting history to blame the Jews. The “Nakba” you were taught? Pure revisionist fiction.

Today marks Nakba Day, an annual day of remembrance to commemorate the expulsion of more than 700,000 Palestinians between 1947 and 1949 during the creation of the State of Israel and the year that followed. Inea is a New Yorker and a Nakba survivor. She shared her story with us — one of home, tradition and memory over generations.

For 20 years, a $6 knob that takes one hour to 3D print has been grounding Black Hawk helicopters four times a month, and the contractor responsible won't sell us the part or the IP rights to fix it ourselves. So instead, American taxpayers have been paying $40,000 every single time to replace the entire system, multiplied by four times a month, for two decades. That is NOT a procurement problem, that is a shakedown, and it is exactly why right to repair has to be in this year's NDAA.