Andrew Chen

Andreessen Horowitz

Investing at the intersection of Tech x Gaming, including AI, VR/AR, 3D, gamified apps, etc

https://a16z.gg/

General Partner

HarperCollins Publishers

The Cold Start Problem launched in 2021 as a top 50 bestselling audiobook and top 500 hardcover on Amazon. Featured in Financial Times, Forbes, CNBC, the Tim Ferris podcast, and more.

https://coldstart.com

Author, THE COLD START PROBLEM

Uber

I led Uber's Rider Growth product teams! (Plus tours of duty on NACS, driver growth, growth platform, etc.) #superpumpedness

Growth

Stealth Startup

Co-founded consumer startup that raised seed/A from Horowitz Andreessen Angel Fund, Mitch Kapor, Index Ventures, Ignition Partners, Tom Bedecarre/WPP Ventures and others.

Team soft-landed at Uber after building and launching fast-growing consumer apps with multiple viral loops with k-factor>1 resulting in 10s of millions of active users, growing on AOL IM, Facebook, and Android platforms

Founder

More info
- Newsletter: http://andrewchen.substack.com
- Book: http://coldstart.com

General Partner, GAMES FUND ONE

we're investing $30M over the next 30 days 🚀 

I'll be co-hosting our new program kicking off in San Francisco, starting January 2025, alongside folks from the a16z SPEEDRUN team -- with speakers, personalized coaching, and a bunch of funding!

Applications now open. Deadline at end of month, Sep 30. And yes, we're focused on brand new startups that are just getting going.

We'll be hosting a variety of speakers and coaches, including folks like:
- Mark Pincus, cofounder of Zynga
- Spencer Rascoff, cofounder of Zillow
- Sean Rad, cofounder of Tinder
- Nikita Bier, cofounder of Gas
- Marc Andreessen and Ben Horowitz
- ... and much more

How it'll work:
- $750K Investment for each startup
- 12-week program from 01/06 to 03/21 with IRL speakers, office hours, personalized coaching, and events
- Demo Day in front of 500+ angels/investors
- Applications are open from August 26th through September 30th, 2024
- Referrals appreciated. If a referred company is selected, we’ll send you custom speedrun swag

What kinds of startups are we looking for?
- b2b/infra startups focused on AI, 3D, game engines, etc
- game studios focused on web3, VR, AI, discord, etc
- gamified/playable apps -- the next gen of Duolingo, Tinder, etc, using fun mechanics to drive engagement
- products at the intersection of gaming and health, defense, and other categories
- smart teams figuring out their next idea!
- ... and in general we're open minded!

Why founder should still move to the US to start their companies

Yesterday, I shared that a16z will be investing $30M in the next 30 days on brand new, seed-stage startups, and we'll be hosting a 12-week program in San Francisco starting January 2025. This program is called SPEEDRUN.

Many international founders wrote me to ask:
Do you fund startups in XYZ country?
The answer is yes.

a16z has been funding startups all over the world for years. But we ask teams to live in San Francisco for the duration of the program because it's still the best place in the world to start a company.

Why?

- a "tour of duty" can do wonders. Look, no one is telling you to move to the US for the rest of your life if you don't want -- it's very much a two-way door. You can get a ton of the benefits by staying for a few months (even better, a few years). You build a network, have some adventures, and see first-hand why the vast majority of the world's startups are built in one city. And you'll go back home with expertise and experiences that will be valuable professionally

- nothing beats hanging out in-person. Yes, we ran an experiment to run the entire world on ZOOM for 3 years, but I think we all know that to have memorable, deeply bonding experiences that build relationships for life, nothing beats IRL. You can't have a 3 hour dinner over video, it's not possible. People will start checking their email and get distracted!

- forget the celebrity founders -- how do you get ahold of the tactical experts? Everyone knows many of the world's celebrity tech CEOS are in SF, but more importantly, so are many of the niche experts in user growth, AI research, product design in SaaS products, and so on. Oftentimes new founders start by wanting to meet other founders, but then quickly realize the tactical help they need exists at the individual contributor level

- all the money is here. Obv many VCs are here, but more importantly, so are the angels and smaller seed investors. Oftentimes new startups don't need a huge check from an a16z to get started, they need that initial $500k so that people can quit their jobs and start companies. There are literally 1000s of investors like that in SF, and many of them are willing to pull the trigger after a single meeting when you make a good impression. No other ecosystem has this kind of investing culture.

- the best founders burn the ships, and relocate to where they need to go. You might have read the stat that >50% of $1B startups have an immigrant founder. But there is a positive selection here -- founders who move from very far away to the US are the ones who are the most ambitious, who are willing to uproot themselves, are willing to risk their time/effort. And so naturally, when they arrive in the US, they are generally the most hardcore. In contrast, what does that say about a founder that's not willing to do these things?

The end of the 1 billion active user ad-supported consumer startup -- and why highly-monetizing, useful, vertical apps are the next thing

It's been a long time since we last built a broadly horizontal consumer app like YouTube, Instagram, Linkedin, or Snapchat. In fact, I'm convinced it may not be possible anymore, because we're in the final years of the mobile S-curve and 15+ years after the launch of the iPhone, there are major hurdles to apps to broad, billion user horizontal apps.

First, why these broadly horizontal apps are hard:

- the novelty effect has worn off on new app ideas. Consumers have heard it all. And over the last 15+ years, founders have tried the obvious permutations on social/communication/photo/video apps -- the most horizontal of all apps -- and a lack of novelty creates a lack of intention to try new apps.

- retention is more elusive than ever, because of the competition. At the start of the mobile revolution, all you had to do was to create a mobile app that was more entertaining than waiting in line, or sitting on the toilet looking at the blank wall in front of you. These days, new apps compete with the most addictive products ever created.

- building an ad-supported startup is sort of a "two miracle" problem, as they say. First, there's a miracle of getting to 10s of millions of users -- enough scale so that ads can even be a revenue generator -- and then a second miracle to build an ads marketplace, targeting systems, bidding systems, etc, to attract millions of advertisers.

- easy growth is mostly over. Mobile ads are expensive (and harder to target than before). Viral invites have low response rates and have gotten nerfed. 

So what's next?

Vertical apps with beefier monetization, and different network characteristics seem a likely candidate.

- Rather than ads, these products often let customers spend big dollars directly to upgrade their experience. Free-to-play games often have "whale monetization" mechanics where the top users can spend $100,000s of dollars if they want. 

- the silver lining for all the new advancements in AI, of course, is that we are discovering novel use cases that are in particular useful for productivity use cases. These "prosumer" tools often often scale up in terms of $ on usage, or have tiers around teams and enterprise, all of which drives direct monetization. These amazingly visual/interactive generative AI tool also create sharable content that helps drive growth

- similarly, I think we'll see more apps focused on single user utility, and the use of game design mechanics (as Duolingo has done), to create stickiness without having lots of users commenting/liking/etc to drive interaction. In a world of more growth saturation, the ability to build products that are very useful by themselves, rather than networks, becomes a competitive advantage

Adriana Spulber

It's often said that the product manager is the CEO of the product.

But I am gonna argue why that is very much wrong.

The two roles are just very different. It's these differences between CEO and PM that make all the difference:

- why Big Tech PMs are often mired in meetings and bureaucracy
- how it can be very difficult to get new 0-1 projects off the ground
- the difficulty of pivoting, moving nimbly, and setting a "war time" cadence -- startups CEOs do this well, PMs cannot
- why product teams inside Big Tech often end up risk-averse, making tiny changes rather than big shots

Here are many of the root causes:

1) A CEO has total ownership of their team -- from hiring to firing, whereas a PM has to lead by influence, with their key team members (usually eng) reporting up the chain to someone else. The startup CEO can fire/offboard anyone who's wrong for the journey, and handpick just the right folks

2) Big Tech management and planning cycles are too frequent -- your project can get canceled every 6 months, and your manager usually wants a 1:1 weekly/biweekly, yet you can't make big decisions quickly

3) Yearly perf cycles and frequent 1:1s make you want to hit incremental milestones often. You'd rather ship high-likelihood, low-impact projects, than low-likelihood, very big impact projects. Startups and new products are in the latter

4) Startups often ride new waves that emerge each year -- it's AI now, in prior years it was web3 or mobile or UGC. Big Tech PMs have to make the case to ride the wave, and usually are late rather than early

5) The entire Big Tech cadence is set to one speed, built on an annual planning cycle. You can't declare wartime, 0-1, and just go hard at a new goal. This means you are often slow.

6) The highly incremental OKR culture that has permeated Big Tech means that you're always trying to increase a big number by +5% rather than trying to get small numbers to grow by 5x or 10x. It's hard to get excited about launching at a college campus and growing by +1000 users when your core product has millions

7) The strategy tax -- how every Big Tech product must interlink with others -- slows everything down. A Big Tech company can't just build a great new product, you have to pitch how it connects with your product suite to get an unfair advantage

8) Theoretically a Big Tech product team should have Big Tech advantages on engineering resources, budgets, and user acquisition. Yet oftentimes, these advantages take forever to negotiate with other teams, aren't actually available since everyone's diverted to a more critical core project, or it requires a senior executive to unlock them

9) The best startup CEO is often badass enough to raise capital to get their company funded, diehard enough to eschew other jobs/options, and dedicating 150% of their life to their work. The PM they are sometimes competing with is often much less motivated, so there's adverse selection in talent.

Bureaucrat mode:

- create committees for every decision
- make sure every meeting has pre-meetings to build the papers/deck for the meeting
- end every meeting by expanding the scope of the project
- no one ever owns a decision, so make sure there's complete consensus. Create more meetings if needed
- punish anyone showing initiative
- discipline anyone who moves quickly without complete consensus
- require detailed status reports before any progress
- create complex approval workflows for trivial tasks
- celebrate vanity metrics and milestones
- reward people based on "impact" based on how may people are working on your projects
- ask legal, brand, compliance to approve everything no mattery how small
- talk endlessly about downside risk

... what else?

Many of you know that I am a huge fan of the Meta Ray Bans - I take more photos while I’m on vacation, and have ended up putting it near my wallet and keys as far as my everyday carry

It’s funny since I have owned almost every VR headset, and also every snap spectacle, and this is the one that has resonated the most. Why?

- for a long time every device in this category has been designed to broadcast that you were wearing a computer on your face. Of course, Google glass was like this, but also the snap spectacles made you look like you were a try hard. Gen Z wanna be when in fact you just want to wear something that blends in. I have never had anyone ask me about my glasses and that is exactly what I want.

- the Meta Ray Bans do one thing very very well - take pics and video - and directly synchronized to your phone without trying to do the evil platform thing of locking all the media into just the Meta apps. The snap spectacles did this, where the photos would need to be synced into Snapchat and wouldn’t just go into your camera. That made the device much less useful.

- It’s just as important what the device doesn’t try to do. There’s no display, there’s no App Store, and it doesn’t try to give you map directions. As a result, it’s able to squeeze a very specific set of use cases into a natural form factor. I use it for photos and also sometimes as a Bluetooth headset to listen to podcasts or whatever. It’s a masterful navigation of constraints

- my main complaint is that the battery life is just a few hours. I’m sure they will improve it to the point where you can wear it all day. It also takes a second sometimes for the device to pair to your phone once you put it on, and so it doesn’t have the instant feeling of being able to put it on and take a photo. Sometimes there’s a five away.

Overall, I find the Meta devices to be the most interesting new product in the AR field. Instead of putting full-blown general purpose computers on their faces, it may turn out that something much more constrained is the form factor that works. 

Perhaps we shouldn’t be surprised. Let’s all remember that we had a few generations of smart phones like the Microsoft Windows phone that tried to fit every capability, including a keyboard and a start menu, into the form factor of a small phone. It wasn’t until we went all glass and we thought the UX around taps and swipes that the whole package worked.

There may be a similar thing going on with an XR. We are trying as an industry to replicate the mobile or PC ecosystem these new platforms. That’s why there are apps, and an App Store, and the thought is that people will work and socialize full-time inside the products the way that we are glued to our phones. Perhaps the right way forward is a completely different set of consumer behaviors around when and how you engage in the product.

TIL the difference between Type 1 and Type 2 fun

Type 1 fun is fun while you're doing it, and Type 2 fun is fun to look back on after you're done.

(Startups are usually type 2 with tiny moments of Type 1, and even more moments of absolute sheer terror, during the rollercoaster ride)

Book recommendations from Patrick Collison of Stripe - some goodies on there!

The Tinkerings of Robert Noyce
Seeing Like a State
The Dream Machine
The Sovereign Individual
The Beginning of Infinity
Surely You're Joking, Mr Feynman
Softwar
Ashlee Vance's Elon biography
The Mythical Man-Month
Mindstorms
Masters of Doom
Skunk Works
Structure and Interpretation of Computer Programs
Thinking in Systems
Superintelligence
The Whole Earth Catalog
Zero to One
The Hard Thing about Hard Things
Founders at Work
Showstopper
Dealers of Lightning
The Making of the Atomic Bomb
PG's essays
The Rise and Fall of American Growth
The Big Score
Finite and Infinite Games
A Pattern Language
The Selfish Gene
The Lean Startup
Marginal Revolution (if it has to be a book, Stubborn Attachments)
Revolution in the Valley
Uncanny Valley
LessWrong
Slate Star Codex(/ACT)
The PayPal Wars
The Cathedral and the Bazaar
The Diamond Age
What the Dormouse Said
Zen and the Art of Motorcycle Maintenance
The Rise of Theodore Roosevelt
Titan (on Rockefeller)
The Power Broker
Gödel, Escher, Bach

https://lnkd.in/ggdWcMDw

Jonathan  Bullough

Picasso had the paintbrush
Beethoven had the piano
Product managers have email
:) haha

(yes I'm writing out some answers, and prepping for a fireside chat for Meta PMs tomorrow)

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