Tomorrow, and Tomorrow, and Tomorrow
David Peterson

I just finished reading Gabrielle Zevin’s excellent book Tomorrow, and Tomorrow, and Tomorrow, which I found to be utterly engrossing and well worth reading.

The book follows two unlikely friends, Sadie and Sam, who first bond over Super Mario Bros. in a hospital waiting room, and grow up to make video games together. And while the language of the book is all game design, and the setting of the book is all gaming culture, it’s really a book about friendship and entrepreneurship.

There were many elements of entrepreneurship that rang true for me, as someone who has both founded a company and been in and around the beginnings of companies for my whole career.

First, Zevin does a good job of capturing the early all-encompassing obsession, the thrill of initial success, and the anxiety of wondering if you’ll ever be able to find success again.

Second, Zevin provides a crash course in conflict among founding teams. There is the underappreciated co-founder, Marx. He’s the non-technical producer who is slowly, inexorably, pushed out as Sam grows to resent him. This is an unfortunately common story. It’s easy to valorize building, and discount the work that makes building possible. But startups do so at their own peril.

Sam may have been blind to Marx’ value, but he also shares what is perhaps the most astute description of the founder partnership I’ve ever come across (when describing the intimacy that comes from playing a game with another person): “To allow yourself to play with another person is no small risk. It means allowing yourself to be open, to be exposed, to be hurt. To play requires trust and love.” I don’t think I ever felt that way while playing Super Mario Bros., but when starting something? Absolutely. There’s something deeply intimate about building something audacious and new with another person, and Sam captures that perfectly.

Finally, Zevin also makes an interesting point about the importance of timing in a startup context. At one point, Sadie says to Sam: “If we’d been born a little bit earlier, we wouldn’t have been able to make our games so easily. Access to computers would have been harder. We would have been part of the generation who was putting floppy disks in Ziploc bags and driving the games to stores. And if we’d been born a little bit later, there would have been even greater access to the internet and certain tools, but honestly, the games got so much more complicated; the industry got so professional. We couldn’t have done as much as we did on our own.”

While reading this section, I couldn’t help but think that this is a perfect encapsulation of what investors are looking for when they ask the “why now?” question. If the timing was off, if Sadie and Sam were building a few years earlier or a few years later, the entire endeavor may easily have failed, either because it would have been too hard, or too obvious (and thus too competitive). Same people, same abilities, same ideas…wildly different outcomes.

I firmly believe that a priori knowing you’ve nailed the timing of your startup is pretty much impossible. There are too many variables that are unknowable. But I also think you can improve your chances of getting it right by spending time at the edges of things. The first personal computers were built by hobbyists in garages. The next revolution will have similarly humble beginnings. That’s why I’m always looking for those founders who are already living in the future, whether they realize it or not.

Tomorrow, and Tomorrow, and Tomorrow is not a business strategy book. You won’t find tactics on how to lead a productive all-hands. There’s no theory for why Hewlett-Packard was the greatest company of the 1950s (for that you’ll need to read Bill and Dave, which is actually quite interesting). And nobody utters the word “disruption,” not even once. But I came away buzzing with more lessons than I have from most startup books out there. So if you’re still looking for a summer read, give it a go. I’d love to know what you think!

David

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WORTH READING

ENTERPRISE/TECH NEWS

Managing the Data Mess with SDF. Benn Stancil covers the emergence of SDF, and, along the way, makes some interesting observations about how real enterprises actually use data. “When people talk about data quality and reliability, they often implicitly frame it as an unambiguous fight against entropy. We win if we’re persistent, prudent, disciplined, and thoughtful; we lose if we are lazy, reckless, inattentive, or foolish. But we would never lose because we chose to. I’m not so sure that’s true. Though we’d never quite characterize it this way, I think a lot of data teams implicitly and reasonably choose disorder and disorganization. Consider how a company builds out their data infrastructure. They start with a few basic pipelines that power a handful of simple reports and dashboards. The business grows; more functions need more reporting; some marketing project unexpectedly catches fire and data tooling has to rapidly expand to support it; some partner initiative fails and a data sharing program gets axed. In hindsight, the Frankenstein stack that gets created — planned one step at a time, full of half-built experiments and partially-deprecated failures — looks like a huge mistake. But, just as true of analysis, the mess has a purpose.”

Thales buying Israel’s Imperva for $3.6B. According to Calcalist, “French multinational company Thales is acquiring Israeli-founded cybersecurity company Imperva for $3.6 billion. Thales will be purchasing Imperva from private equity firm Thoma Bravo, which paid $2.1 billion for the company in 2018. Imperva was founded in 2002 by Amichai Shulman and Mickey Boodaei. According to Thales, this acquisition will add approximately $500 million of revenue and over 1,400 employees. Imperva is headquartered in San Mateo, California, and is headed by CEO Pam Murphy. The company has an R&D center in Israel which employs hundreds of people. Imperva’s products help organizations protect critical applications, APIs, and data. The company’s integrated approach combining edge, application security, and data security, aims to protect companies through all stages of their digital journey.”

Hunting for Chinese malware. The New York Times reports that the United States is searching for “malicious computer code it believes China has hidden deep inside the networks controlling power grids, communications systems and water supplies that feed military bases in the United States and around the world.”

Understanding Bard. Adi Mayrav Gilady, a product manager at Google on the Bard project, gave an interview to Calcalist where she shed some light on how to think about LLMs. “Behind a large language model, there is no database from which it extracts information. It’s a statistical tool trained on a vast amount of text and predicts word combinations with statistical probability. That’s why we may observe mistakes or inaccuracies. We are constantly working on improving this. For example, problematic or inaccurate answers are removed, and as part of the model’s training, it is taught to be as close to reality as possible. However, it is important to understand that Bard is not intended to be a tool that provides specific or factual answers. For that purpose, Google search is the best tool. Bard is a companion for creative tasks, a place for brainstorming, and a tool for imagination.”

HOW TO STARTUP

The three-person unicorn startup. James Currier of NFX describes how, to his mind, generative AI makes it easier for small teams to go much farther. He argues that many startups will only need three people: a CEO/founder (aggressive visionary generalist), a words person, and a numbers person. “This isn’t far-fetched. If you recall, we’ve already seen this alternative allometric scaling in tech companies before AI. It was just isolated in a small, but very visible, niche of the tech world: social media. Instagram had 12 employees when it sold for $1B, and WhatsApp had 50 people when it sold for $21B. With AI, the TYPES of businesses that can achieve this type of allometric scaling will increase dramatically. To be fair, to pull off a three person unicorn will require very special talent among the three people. Few teams will have the multifaceted skills to pull it off. When is this happening? Now.”

In defense of strategy. Packy McCormick shares some war stories and argues that while execution is critical, strategy is equally indispensable. Here is how he defines strategy. “A strategy is a high-level plan to achieve one or more goals under conditions of uncertainty, designed through recognizing the challenge (diagnosis), setting a direction to overcome it (guiding policy), and detailing steps to implement the policy (coherent actions). Those three pieces — diagnosis, guiding policy, and coherent actions — form the strategy kernel….A startup can’t be expected to have moats in the early days, but it should have a strategy in place that gives it the best chance of having them in place by the time the uncertainty window runs out. The best time to craft a strategy is before you start the company; the second best time is now. Strategy isn’t set in stone. It should evolve as the facts do, and as the startup learns by doing. A startup’s strategy should actually evolve faster than a larger company’s because there’s so much uncertainty and such a high rate of learning, and because a startup is still nimble enough to change course as needed. A rough way of thinking about what should change is that the diagnosis should be the most stable, the guiding policy should be relatively stable, and the coherent actions should be the quickest to adapt to new information.”

HOW TO VENTURE

Tracking the slowdown. Eric Newcomer dives into the data to figure out which venture firms have actually slowed down the most, and why. According to Newcomer, that list includes firms like GFC, Tiger, Slow Ventures, Tribe, Index, Insight, Coatue. “Slow Ventures’ Kevin Colleran, who manages the firm’s relationship with its limited partners, hopped on the phone with me to explain Slow’s slowdown. “We’ve made a specific choice not to chase AI right now and I think the majority of activity that other firms are doing are AI,” Colleran said. (Lessin has called generative AI “fools gold” and has written that “seed investing isn’t coming back … at least not as it existed in the last decade.”) Colleran explained that outside of artificial intelligence deals, “there’s little-to-no signal about what unlocks a Series A term sheet these days.”

An honest assessment. Andy McLoughlin of Uncork gave a candid interview to Techcrunch on that firms’ strategy and on where he sees the seed market going. “I think a lot of the smaller seed funds that blossomed in the last five or six years are going to find that after having blown through capital on a one-year or 18-month cycle a few times, their LPs are kind of tapped out. Many high net worth, individual LPs are just going to say, “Look, you can’t keep coming back to the well. We need to see [distribution to paid-in capital] before we can recommit.” A lot of operator VCs are probably going to get pressure from their companies and their board members to be focused on their [own] businesses.I think Series A firms will continue to move down. Every Series A fund now has a seed program. But for us, that’s where the opportunities lie because we know we can beat them when we move quickly. The big funds need time, even if it’s a $2 million check. Smart entrepreneurs still realize, too, that there is still some signal risk in bringing in a top-tier firm that ultimately doesn’t lead their Series A. And I think we’re going to see kind of a bloodbath in 2024 because so many startups at all stages have really kind of dug in and are making their cash last as long as possible. Companies that probably should have been fundraising this year are going to try to go out in 2024 or 2025 [to avoid a down round], but there’s going to be more businesses raising than there is cash to go around.”

PORTFOLIO NEWS

LightSolver’s CEO, Ruti Ben Shlomi was featured in Laser Focus World’s July issue, where she was recognizing as a top researcher and scientist reshaping the optics and photonics industry.

Snyk conducted a survey and found that the use of GenAI is creating more vulnerabilities in code.