Newsletter

We launched Secfi’s first newsletter today. We had been talking about doing a newsletter for a few years now. We always thought it was a great idea to share our thoughts and opinions on the world that we live in. For many reasons, it always got put on the backburner.

The biggest reason was just time and priorities. We didn’t feel like writing a weekly or bi-weekly newsletter was the best use of anyone’s time. Looking back on that - I regret not launching it earlier. A newsletter is a great way to connect with our audience and build the base of a community.

On top of everything, it’s been really fun writing again. I had the pleasure of authoring our first week’s newsletter. Others from the team will chip in from time to time. It’s about an hours worth of work to write it and I have fun doing it. It’s nice to get out of my spreadsheets and powerpoints from time to time.

My life philosophy

I’ve been thinking about existential shit recently. I’m not sure why, but I’m guessing it’s because I’m getting older and because I want to bring my own kids into this world soon.

I was reading Twitter the other day and some guy was posting about his life philosophy and I realized that I’ve never really thought about mine. Sure, I have some values and whatnot, but I don’t know if I’ve ever truly defined my life philosophy.

So I’ve been thinking about it for a bit and on my walk during lunch, I realized that I probably do have a life philosophy already, I just never wrote it down. So here I am today.

Happiness in life is bringing joy to others

That’s it. I truly believe that my happiness in life stems from bringing joy to others which in turn brings joy to myself.

Having everything with no one to share it with is just the same as having nothing. It’s why sharing an amazing meal with someone is much better than eating by yourself. Having every material good and toy in the world absolutely sucks if you have no one to share it with.

No work is ever worth it if it doesn’t bring joy or happiness to people’s lives. We build startups to solve problems and bring joy to others. This is why I love working at Secfi so much - I get to help solve people’s problems on a day to day basis.

I don’t know how and why humans got here. I do know that I’m going to spend my life trying to make other people happy. That’s a life well lived.

Monday funks

I feel like my Mondays have been pretty tough recently. It’s as if I’m in a bit of funk every Monday (and often other days). There’s a bit of imposter syndrome on these days and my self-esteem feels like a low on Mondays. Even the smallest tasks are much harder on Mondays than they are on other days.

I used to think that the cause of this was that I just had tiring weekends that left me fatigued and out of it on Mondays. There was some of that for sure, but over the last few months, I have really stopped going out much which doesn’t explain the Monday blues still.

As recently as a few months ago, I started to think that it was simply just a bit of burnout. I definitely think there definitely some impact here. I’ve taken some vacations and think I’m really due for a larger vacation that’s not tied to an event like a wedding. Something nice and relaxing maybe what I need.

After thinking about it some more on my lunch walk, I think I’ve decided that a lot of it just has to do with my mental mindset lately. I probably have twice as many negative thoughts on Mondays than I do other days.

Curbing this habit used to be a lot easier when I was going into the office and seeing a bunch of my friends. But with remote work, things are just much lonelier and depressing on Mondays. Combine this with a lot of negative news lately going around in the world and it’s create a perfect storm.

I don’t think there’s a complicated fix here. A lot of it just changing my mindset on Mondays, staying positive, listening to good music, surrounding myself with good people, etc. Most of all - I need to make sure not to be too hard on myself on Mondays. This perpetuates my negative mindset.

The unsexy things

I was able to watch the end of the The Open championship this morning over my breakfast. I was somewhat surprised to see Cameron Smith outduel Rory McIlroy down the stretch. It seemed like Rory had a commanding 2 shot lead going into the back 9 and he was going to run away with it.

Rory played well enough to win. He hit 36 putts and 2-putted every hole. He made virtually no mistakes. But the difference was that he wasn’t able to make any birdie putts down the stretch. He came close… a lot but they didn’t fall.

Contrast that to Cameron Smith who was money with his putter all day. He had only 29 putts and that became the 2 shot difference down the stretch. It was epic to watch.

Golf is an interesting sport. Everyone talks about long hitters, powerful swings and shot shaping abilities. Like most, I think that’s the most fun part of golf. But as saw today, it was the unsexy part of golf that won it for Cameron Smith.

Like sports, I’ve come to realize that in the business world, it’s almost always the unsexy and inglorious things that make the world of a difference.

Today, I’ll spend couple hours practicing my chipping and putting. As I begin my work week tomorrow, I’ll be focusing on the unsexy things that I’ve been putting off for some time.

Breaking things down to build it back up

I’m in the process of completely revamping my golf swing. I’ve had an unorthodox swing for some time now and it has worked decently well. I’ve broken 100 quickly and I feel like I’ve had spurts of glory on the course. Of course, a flawed swing rears it’s ugly head often and that’s what’s been happening.

While there is no perfect swing, my swing made things extra complicated in that lots had to go right for me to hit the ball straight. I hit the ball straight often as I was able to recover and build my swing with a bunch of tweaks. I’m now at the point where I realize that my severely flawed swing can only take me so far and I may never get to where I want to if I keep doing what I’m doing.

So I’m breaking everything down and starting from scratch. I’ve decided to completely revamp my swing to eliminate the major flaws. It’s going to be many steps back, but I’m hoping that this will be the springing board going forward for me. Day 1 starts today. With 3 rounds ahead of me in the next week and half, I’m a bit worried about my performance on the course, but the pain will be worth it in the long run.

Over the last few weeks, I’ve had a lot of similar thoughts to what we’re doing at Secfi. We’ve been doing this for 4 years and there’s a lot of things that need to be addressed that haven’t. Sometimes things are just not worth fixing and it’s better to scrap the entire thing and build it back up.

We just had a call with our product and engineering team on one initiative that we’ve worked on the last few months. In light of recent events, we’ve come to realize that we need to scrap those plans and restart from anew. Yes, it sucks. We spent time, resources and money on that initiative. But we also realize that to get to where we want, we need to switch course and start from scratch.

Like my golf swing, I wish we had done this many months back, but there’s no better time to start than now.

Our office in San Francisco

We are now looking for another office in San Francisco after our current lease is trying to 3x the monthly rent. In a market where people are reporting that almost 40% of offices in downtown San Francisco are vacant, I do not see how they end up leasing the space out. But that’s not my problem.

It is my problem to figure out where our next office will be. I’ve written recently about how there is a complete lack of energy in San Francisco. Most people who still remain in the Bay Area seem to want to work from home. Contrast that to New York where people are in the office almost every day.

We’ve got some decisions to make as a team here in San Francisco. As of right now, we have at best 5-10 regular attendees in the office. Our New York office already has that same amount and it’s a much easier flight from Amsterdam where our 3rd office is at. We’ll need to decide if we want to invest in space in New York rather than San Francisco as our headquarters. At this point, it seems like this is the logical decision especially with our capital partners being based in New York.

We’ll need some sort of space in San Francisco. The choice will be between a co-working space or signing another lease somewhere. The flexibility of the co-working space is really nice, but that also comes with some major issues. We do know that we are going to downsize the San Francisco office significantly from a 60+ person office down to probably a 15-20 person office. It just doesn’t make sense right now for us to be paying for such a large space and no attendance.

Brainstorming over Zoom

I’ve been in back to back meetings for the last week. It’s been a long week of long Zoom calls meeting with leadership and various teams on planning for the 2nd half of the year. I’ve also put a lot of emphasis on getting feedback from as many teams as possible to revamp some of our processes during H2.

Ideally, we would all be in person and work through it in a conference room. Unfortunately, we’ve had to resort to Zoom and it’s been exhausting, but fulfilling. I’ve learned a lot about working on Zoom, especially in the group context and have come a long ways from April 2020.

Here’s some of my favorite tips and hacks when it comes to group brainstorms over Zoom:

• Lower you expectations when it comes to Zoom. Video conferencing has severe limitations and everyone knows it. Some people expect it to completely replace in-person meetings and by doing so, you’re setting yourself up for failure. Know it’s limitations.

• Have one moderator that keeps things on track and ensures that everyone has a voice. You can’t talk over people on Zoom and it’s often hard to see the people that are less assertive trying to speak up. One person needs to be watching the group and ensuring that everyone can speak.

• Keep everyone on track by asking each other a lot of questions. It’s really easy to get distracted on Zoom and multi-task. People get bored easily and Zoom makes things much worse. Make sure that you are keeping each other honest and challenging each other at all times.

It’s not perfect, but Zoom gets the job done. With a few minor tweaks, life is a lot better over Zoom.

China and liquidity

I woke up to the news of the Chinese government squashing a group of protestors who are attempting to get their life savings out of their bank. It appears that some Chinese banks are going through a liquidity crisis and have resorted to freezing accounts. On the surface, this seems like a terrifying prospect and perhaps a sign of a worsening economy.

China is already dealing with strict government mandated lockdowns. I can only imagine the plight of the Chinese now that there is a potential liquidity crisis looming. I don’t know how this all ends, but I’m hoping it’s resolved soon.

All this stuff scares the living shit out of me. I can only imagine what it’s like to have your life savings locked up with no way to retrieve it. It’s a stark reminder that I need to do a better job saving in this market. All this could get a whole lot worse.

A change of scenery

I had a great weekend up in Lake Tahoe. A change of scenery for a few days of work and a weekend to let loose was great. After a good 3 days of closing out the work week, my friends and I went to gamble a bit and then watch the American Century Championship which is a celebrity golf tournament at Edgewood in Tahoe.

I had been struggling a bit with productivity the last couple of weeks, feeling a bit down and demotivated. I believe this was attributed to just a long last few months of grinding mixed in with the perceived negative sentiment of the world right now. Being up in Tahoe with a switch-up on my day to day routine was a nice breather and I seem to have my mojo back.

It was a good reminder to switch things up when they everything starts to feel stale. I’m a creature of habit and sometimes I fall into the same boring routine for weeks and months on end. It can get boring real quick. I’ll look to kick things off in H2 2022 with a bit of a clean slate when it comes to my schedule. New food, new workouts, new work locations… it’s all on the table.

Future of NFTs

I’ve had a lot of discussions with friends and colleagues about NFTs and the drop in value. Lots of mainstream media seems to be picking up a lot of the failed projects primarily around celebrity projects failing to live up to expectations.

As someone who has participated in a few NFT projects and spent a decent amount of money in the space, I truly believe that this will be good for the ecosystem in the long run. There were way to o many get rich schemes more akin to pump and dumps than real businesses and projects. The vast majority of people that bought NFTs over the last year were in it for the quick profit. I know as I have a lot of friends who were in that boat.

Over the long run, I do see value in NFTs. In the most basic sense, you can compare them to collectors items in which people spend a good amount of money on even in this day and age. If you think collecting items and art is a worthless endeavor, then I’d imagine you’d feel the same about NFTs.

Beyond the collector aspect and online swag aspect of NFTs, I believe we’re still just touching the tip of the iceberg when it comes to NFT use cases. There’s are and will be unique ways NFTs can be utilized in real world use cases beyond the get rich schemes.

Of course, the challenge will be adoption and the pipes and infrastructure for crypto is just not there yet. As my stance has always been, I’ll be participating in NFT/crypto projects that I want to be part of. There is great learning potential there and I want to be part of the evolution of this new technology.

The (lack of) energy in San Francisco

Yesterday, I tweeted about how going into the office in San Francisco is a bit depressing nowadays. There is noticeable drop in people compared to pre-pandemic times and the energy overall is just lacking. Compare this to other cities who have fully come back and it’s a bit sad to see. I can tell that I’m not the only one that feels this way as the tweet had a lot of interactions on it.

As much as I want to blame San Francisco politicians for this, I believe this is created by lax tech culture of the late 2010s. Employees and companies were in boom times and there was a shortage of labor so companies did everything possible to make employees comfortable. A lot of tech workers in San Francisco would quit their jobs if their companies forced them to go back into the office. Call it what you want… the future of work… tech 2.0… privilege. It is what it is right now in SF.

I am saddened by this and realize that we likely won’t ever get back to the point of bustling San Francisco downtown in the 2010s. There is a change in culture and remote work. Yes, things will rebound and get back to some semblance of normalcy, but I think our best case is probably 50% of the peak in 2010. Perhaps 75% if the market starts to shift significantly in favor of employers.

I can’t make Google or Facebook force their employees to come in and fix this lack of energy in SF. However, I was glad to find out that I wasn’t the only one who felt this way. I had multiple people that I have never met DM me asking to grab lunch or coffee in SF as they had felt the same way. I see this as a great way to meet new people who are building just like me.

I’m not sure what will come out of this, but I’m excited to meet some new friends for lunch next week and see where it goes.

H2

H2 2022 is here. Crazy to think… this was a fast 6 months. It was just yesterday we were closing a record 2021 and the markets were still booming. Things have clearly changed since then.

I’m not sure what H2 will look like in terms of the market and economy. Many are saying we are already in a recession and they may not be wrong. Quite frankly, in terms of work, I’ve gotten to the point where I need to care much less.

Planning for Q3/Q4 over the last few weeks have done wonders in terms of clearing my head. I’ve been too focused on external factors and not focused enough on the things that we can control. So for H2, I’m keeping things simple and focusing on myself, my team, and my company and the things we can be doing better.

When times are tough externally, it’s a perfect time to focus on building and that’s what we intend to do at Secfi. Our mission at the company hasn’t changed and will not change based on the economy or the market. I’m looking forward to this change of pace and the newly found headspace.

Tired

The 4th of July holiday came at a perfect time. I feel absolutely dead this weekend. It was a brutally long week of work and I feel like I haven’t been getting proper rest. I reluctantly went out to grab a dinner on Friday, but came back absolutely gassed.

I was dead all day on Saturday and when I went to bed, I started feeling like I was getting aches and the chills. I suppose it’s some sort of stomach flu that hit when my immune system is at a low. I feel a lot better now after sleeping nearly all day.

I’d imagine this is my body telling me that I need some more rest and sleep. I plan to do just that the rest of today and this week. Being a shell of yourself is not the way to live life.

Cassidy Hutchinson

I’m just starting to catch up to the news of Cassidy Hutchinson’s testimony. I definitely have no desire to write about the politics or the legal side of things here, but I did want to applaud her for what she did.

I find it impressive that a 26 year old presumably went against her political affiliations and prior allegiances in order to tell the truth on what happened on January 6th. I can only imagine the immense pressure that she is under from all parties involved.

By taking the stand and telling the truth, she invited herself to a lifetime of vitriol and hatred. Her name will forever be associated with the events on January 6th and her corresponding testimony. Not many 26 year olds would have done the same thing.

At the end of the day, the truth matters and the American public deserves the right to know the truth. She did the right thing for herself and her country.

Private company deals

Yesterday, I wrote about how I’m accumulating a larger cash position in the next few months in order to prepare for a a worsening economic situation. One exception to that strategy was an investment in a private company that I had been eyeing for a few years.

This was the first new investment I had done all year long as the markets have been slowly on a downturn. I have largely been sitting idle on the public markets. My overall position the last 6 months have been defensive. But on the private market side, I saw these investments as longer time horizons so I was okay with the pricing uncertainty due to the markets.

With this investment, I have now put a good amount of money to work in 3 different startups ranging from Series B to F. Each of these investments come with widely different theses.

The first company was a Series B that I invested in last year had the potential to be a game changer in a growing industry. It was a rich valuation which I acknowledged, but I saw it was an opportunity to potentially 10x in the next 5-10 years.

The second company was a Series B that I invested in earlier this year. It was an amazing opportunity to gain exposure to an earlier stage company in the space industry. Furthermore, the Founders and backers were hard to bet against in this industry.

This latest investment is the latest stage company that I have invested in at the Series F. It was just too good of an opportunity in an industry that my current portfolio had no exposure in (purposely not discussing the industry due to confidentiality reasons). The company is led by a repeat founder that has sold a company for over a billion dollars in an adjacent industry.

I’m excited about these initial investments as I continue to build out my personal private company portfolio. Given the uncertain times, I feel a lot better putting my money to work in companies that are expected to exit in 3+ years and are well capitalized.

Preparing for the worst

Sophia and I chatted a bit this past week about how we should be looking to save a bit more. With the market down and the possibility of a recession coming up, I’ve realized that we need to prepare for the worst case scenario.

Overall, I am happy where we are at financially, but it could be a lot better. Like most, we’ve been susceptible to lifestyle creep over the last few years. I’ve been guilty as well and a lot more loose with my cash the last couple of years post-pandemic. As someone who was really aware of the lifestyle creep, it was hard not to spend more during the past 2 years. The promise of the “Roaring 20s” was something ingrained in my head as I traveled a lot and bought toys. It’s time to settle down a bit.

I’ve also underestimated how much cash I should be holding onto. In the last few years, I’ve been putting a lot of money to work by investing in the public markets or startups. That’s great of course, but in a downturn, I’d feel a lot more secure for Sophia and I if our cash balances were a lot higher.

We’re not an extravagant couple by any means, but we hope to start a family in the near future and that changes the equation. The bear market did us a favor by opening our eyes a bit that things aren’t always going to continue to go up and downturns do happen. It was a nice sign that I need to make some lifestyle and money changes to protect my family’s future.

Summer break

I joked on Twitter that the VC and startup community should band together and declare a summer break where we all just return in 3 months. We’d be tanned, rested and ready to build again. It’s been a long 2.5 years since the pandemic started and we’ve been through a lot. We could all use a summer break.

While this summer break will exist only in my dreams, I do have big plans for the summer. The capital markets and therefore deal flow has come to a screeching halt this summer. Yes, we’re open for business at Secfi but the scale is a fraction compared to last year. My friends that are investors or work in M&A have declared a mini-summer break.

While the situation isn’t ideal, it does present a good opportunity for a reset that I’m looking forward to.

First, I plan on completing a lot of things that I’ve put on the backburner such as some testing and licensing requirements. Studying on the beach doesn’t sound so bad.

Secondly, it’s a great opportunity to focus on improving and streamlining processes. With deal flow down, we can focus on internal changes within our org so we become a much more efficient machine. I have a laundry list of items that have been pushed back that I want to tackle this summer.

And last but not least, it’s a great time to focus on product and build. We have big ambitions for the coming year at Secfi and this “summer break” will allow us to get a big jumpstart on initiatives we have planned.

It may not be a true summer, but it’ll be a nice change of pace. I’m looking forward to it.

Sales in everything

A couple weeks ago, I was talking to some friends who work in different industries. Think physical therapy, conservation, science, etc. Naturally, they had asked what I do for work at Secfi and without diving into boring details, I summarized that my role like every other role is mainly just a form of sales.

They were a bit surprised and I got the usual response I normally get. “But you aren’t like a typical sales guy?”

There’s always this interesting perception that the Sales guy is that guy who can sell his shirt off his back. Smooth talker. Well dressed. You know the stereotypes. In reality, I think sales is far from that - more on that on a different post.

More importantly, sales is in every single thing you do in business. Let’s use a few examples:

Business development / Partnerships - you’re selling an agreement

Marketing - you’re selling the company or a product

CEO - you’re selling the company to investors and prospective employees

If you work at a business or startup, whether you know it or not, you’re in a sales role. It’s unfortunate that a lot of people don’t understand this. They think pedigree and resume alone will get you to where you want to be. But at the end of the day, you need to be able to sell yourself and/or your company/product to get somewhere if you’re going to move up the chain.

Optimism

It’s 90 degrees here in San Francisco today. I’d obviously rather be at the beach than the office, but the summer weather is great regardless.

I loved Fred Wilson’s post today titled “Staying Positive”. There’s power in community and realizing that you aren’t the only one going through tough times alone. Fred’s post helped me feel better about everything going on right now. It’s not just me and Secfi, but nearly everyone.

I’ve written a lot about optimism and staying positive. I know things will pass, but these posts every now and then are a nice reminder that I need my keep my chin up.

Besides work and the market, there’s a bunch of things to be grateful for. After a quick doctor’s appointment, I went to go get ice cream today. Not everything is so bad in life.

Winning

I’m headed to the Warriors parade and taking my little sister with me. Normally, these parades would be an excuse to start partying at 9am for me, but being on a Monday, I just don’t feel like it. Instead, I’ll be taking my sister to the parade. She’s 11 and has been alive for 6 parades (4 with the Warriors and 2 with the Giants). I think that’s a crazy streak and my childhood is definitely jealous.

I was 4 when the 49ers won the Super Bowl and don’t really remember much. Then I didn’t get a parade until I was 20 in 2010 when the Giants won the World Series. What a last 12+ years to be a Bay Area sports fan. The Warriors were cellar-dwellers when I was growing up. The 49ers and Giants couldn’t get over the hump.

In the last 12 years, we’ve had a Warriors and Giants dynasty. The 49ers have knocked on the door with 2 separate regimes as well and seem to be making a push. It feels good to be on the winning side of things.

Speaking of winning, there doesn’t seem to be much “winning” in the startup or investing world right now. I’m glad the markets are closed today, we can all use a bit of a break.

In the startup world, lots of companies are going to have to make some tough decisions over the next few weeks. Whether that’s layoffs, a sale of company, or raising a downround - I expect most decisions to be really difficult ones.

Like others, I’m looking forward to getting back to a period of winning. These droughts don’t last forever and the wins will start coming back for those who can bear through the pain.