The global spread of the coronavirus is making the world more anxious by the day. And those deepening worries are reflected in the fluctuating stock market. Sequoia Capital, one of the world's top venture capital firms, sent a note to the founders and CEOs in its portfolio last week warning that coronavirus could usher in a prolonged global economic slowdown, fundamentally altering the business environment and urging them to brace for coming economic shocks.
In sounding the alarm, the firm called the coronavirus the "Black Swan of 2020." "Black swans" are rare, unexpected events that cause a massive impact and heavily influence global activity. It's worth recalling that the phrase "black swan" gained currency a decade ago during the 2008 recession and aftermath, providing a compelling way of thinking about the simultaneous crises in banking and housing.
Why it matters
Sequoia has been a fixture of Silicon Valley for decades, helping fund generations of companies, including Apple, Google, Instagram and DoorDash. Back in 2008, as the financial crisis was starting to have a negative effect on the economy, the VC firm sent a similar, ominous presentation, titled "R.I.P. Good Times" to the founders and CEOs in its portfolio with the intention of preparing them for what was to come so that their companies could survive. The presentation is still referenced in Valley circles today.
Sequoia's memo this year provides guidance on how to run a startup so it can survive the business and economic challenges posed by the spreading effects of the coronavirus. Sequoia's advice to their portfolio companies is as follows:
Get ready, cut expenses, preserve cash. Think through how much cash you have."Do you really have as much runway as you think? Could you withstand a few poor quarters if the economy sputters?"
The money is going to dry up.Don't count on raising money."Private financings could soften significantly," Sequoia warned, before adding an optimistic note. "Many of the most iconic companies were forged and shaped during difficult times. We partnered with Cisco shortly after Black Monday in 1987. Google and PayPal soldiered through the aftermath of the dot-com bust. More recently, Airbnb, Square, and Stripe were founded in the midst of the Global Financial Crisis. Constraints focus the mind and provide fertile ground for creativity."
Prepare to survive tough sales. Be forewarned that sales might just fall apart."Deals that seemed certain may not close. The key is to not be caught flat-footed."
Cut advertising and marketing expenses.Take a hard look at your marketing spend."You might find that your customer lifetime values have declined, in turn suggesting the need to rein in customer acquisition spending."
Be prudent with capital spending.Take a look at capital spending."Examine whether your capital spending plans are sensible in a more uncertain environment."
The bottom line
Sequoia is saying publicly what many investment firms have been telling CEOs privately: It's now prudent to prepare for the worst.
Eric Berger of Ars Technica visited SpaceX's Texas facility and learned how insanely ambitious Elon Musk's plans are:
He is building a factory to churn out a Starship—the most powerful and most advanced launch vehicle in history, capable of taking 150 tons to Mars—every 72 hours, with the goal of building 1,000 ships to settle Mars.
He wants to design one of the most powerful rockets in the world, produce at least one a week, and get costs down to $5 million per rocket.
Longtime tech journalist Steven Levy shares an except from his book Crypto, about a man who ran in the opposite direction of Facebook's data exploitation and privacy breaches.
This is the story of Whit Diffie, who transformed how we think of encryption, paving the way for the digital security we enjoy today. One of the pioneers of public-key cryptography, which ushered in digital signatures and now underlies the security of e-commerce.
Sameer Singh explores why network bridges and unique user identities are critical to building successful network-based startups and defines 3 different network tiers:
Tier 1networks present the most attractive investment opportunities and, unsurprisingly, represent some of the most used networks across the globe , but not limited to social media companies or even the consumer sphere. All startups that fall into this category are the highest priority for us as investors.
Tier 2 networks either have a fragmented, unbridged network structure combined with a strong focus on user identities or a bridged network structure combined with a weak emphasis on user identity. Good examples are dating apps, neighbourhood social networks, short video apps, live-streaming services, ad networks and online games.
Tier 3 networks combine both a fragmented network structure with a weak (or non-existent) focus on user identities, which is a recipe for creating the worst kind of leaky bucket, i.e. users leave faster than you can add new ones.
WhatsApp is, by far, the top social media platform of choice across several African countries.
With a platform that mirrors regular text messaging in its ease of use, WhatsApp's appeal as a one-stop shop for personal and group chats as well as sharing media files through a light interface has been a major hit on the continent.
But modified versions of WhatsApp which are created by third-party developers are also seeing significant usage among African mobile internet users.
"WhatsApp mods", as they're also known, are directly shared from one device to another or downloaded from sources outside official app stores—as such, they don't show up on download lists of the major app stores.
A look at how Whatsapp and modified versions of it are used in Africa and how popular they are.
Short-form video streaming company Quibi said it has closed a second round of financing worth $750 million, bringing its total investment to $1.75 billion about a month before the service's planned launch. The company said the $750 million includes about $400 million secured at the end of 2019.
NBCUniversal has sold its entire $500 million equity stake in Snapchat as it ramps up investment for its new streaming service. With the entertainment giants pouring billions of dollars into new streaming services while also balancing debt obligations, they are taking a hard look at their portfolios to find pieces that may not fit with their new strategies.
Rakuten and Vodafone led a $110 million investment in AST & Science. The company is planning to create a cellular broadband network with a constellation of hundreds of satellites called SpaceMobile that would link directly to people's smartphones. The patented Low-Earth-Orbit satellite network will be the first of its kind, with enough power to connect directly to 4G and 5G devices everywhere on the planet, in remote areas on land, at sea, and up in the air.
Hailo, an Israel-based AI chipmaker delivering performance to edge devices, raised $60m in Series B funding. Hailo recently launched Hailo-8, its deep learning processor for smart devices operating at the edge including partially autonomous vehicles, smart cameras, smartphones, drones, and AR/VR platforms.
Di satu Januari, lupakanlah sengketa
Separuh nafas jiwaku... sirna
Di pagi Januari, yang kita harungi bersama
Bahagia selalu dimiliki, bertahun menjalani
Naluri berkata di setiap langkah-langkahmu
Dua langit tlah membaur di suatu cakrawala
Biarlah layar terkembang, menderu ombakmu menabuh pantai
Kuingin menyeberang, melintas pulau dan lautan
Sebelas Januari bertemu karena kita ini manusia
Kau basuh diriku dengan sejuta warna
Membiru lautmu memeluk pasir
Menanti setiap detik, ku hitung waktunya
Tak dapat ku kawal perasaan ini
Maafkan salahku saat-saat itu padamu
Biar diriku saja menjawab semua cinta
Biarkan kujawab semua dusta
Menguning bulanmu mengetuk malam
Mesra jemarimu belai sukmaku
Membias bintangmu menghias hidup
Belahan jiwa yang tertinggal
Kala tatap matamu sapa jiwaku
Januari lekas berganti
Kian hangat dalam ingatan
Sampai disini kisah kita
Kian hangat dalam ingatan
Hari ini tak harus ku sendiri yang menanti saat ini
Separuh nafas jiwaku... berakhir d…
Fast, automated image compression trusted by 1.3M WordPress usersView this email in your browserProfessional image compression made easy There's a reason Smush is trusted by over 1.3M WordPress users. Smush will optimize every image on your website for super-fast page speeds.
Backup all of your (or your clients') original images, automatically resize and scale images based on your visitor's device - all with the click of a button. Professional image compression made easy.
Just need a single Smush? Easy – use our free 7-day trial to get your job done. There are no lock-in contracts so you can cancel at any time and your images will stay compressed.