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It is the tip of a brief week, however as a substitute of not having a lot to talk about we now have so much. Nevertheless it’s all superb enjoyable, so let’s take pleasure in ourselves!

First, let’s discuss costly four-legged beasts.

Trillion-dollar horse?

The Change began digging into the Q2 2021 enterprise capital market this week. Because of Anna’s assist our first piece got here out fairly properly, I feel. We’ve much more coming quickly. However the unicorn stats actually grabbed me by the nape. Think about:

  • 136 unicorns had been minted in Q2 2021, an all-time document.
  • As CB Insights notes, that is “nearly 6x the 23 unicorns born a year ago in Q2’20, and already higher than the 128 unicorns born in all of 2020.”

The results of this growth within the horned equestrian inhabitants is that there at the moment are 750 unicorns on this planet. When former TechCruncher and wonderful human Katie Roof tweeted that stat, my first thought was shit, which means unicorns are value greater than $1 trillion.

I used to be approach off. The true quantity is sort of $2.4 trillion (CB Insights information). Which is a shatteringly excessive determine. In comparative phrases, the un-exited unicorn inhabitants of the world is value practically precisely what Apple is value at the moment — $2.42 trillion, per Yahoo Finance.

Maybe I’m overreacting to the quantity of unicorn fairness that’s at the moment sitting, largely frozen, within the non-public markets. Particularly when unicorn exits are up. However are even at the moment’s elevated exit ranges sufficient to clear this specific ledger over time? No, I do not suppose so. Not after we are minting 1.5 unicorns per day in Q2, counting weekends and the like and the unicorn rely is ever-increasing.

Funding rounds

I solely wrote about one funding spherical this week — this r2c round that was fairly fascinating — largely as a result of I had a bunch of different issues to chew via. However I’ve additionally seen my inbound enterprise capital spherical pitches sluggish since declaring that I would not cowl rounds that did not embody extra detailed monetary info.

It isn’t clear but if pitch quantity is down because of the vacation week, or if I’ve scared everybody off. However I do use my inbound quantity of funding spherical pitches each in combination, and in sectordirectional phrases to assist gauge what is going on on. So, this is hoping that (1) individuals will ship me stuff and (2) they may accomplish that and in addition share much more info on the similar time.

SPACs in area

Y Combinator is a neat entity. One among its latest corporations was Albedo, a startup that’s hoping to construct a community of low-orbit satellites that can take tremendous high-res photographs of the planet. To take action is difficult af, as Natasha would say, however maybe doable due to off-the-shelf (kinda) satellite tv for pc elements, in-orbit refueling and a bunch of different new stuff.

Albedo and its ilk are why I nonetheless trot out yearly to observe Demo Day. I get to see what may very well be coming, and that is superb, illustrative enjoyable.

All that is to say that when two satellite tv for pc imaging corporations introduced that they had been going public through SPACs this week I used to be intrigued. Seems they don’t seem to be actually in competitors with what Albedo desires to do, as they provide lower-resolution photographs. However they’re … notable for different causes.

Satellogic for having this simply artistic series of charts (make sure you observe the dates in every chart):

Picture Credit: Satellogic

And Planet for the following, particularly a glance into how the economics of satellite tv for pc tech are fairly closely weighted towards the long run:

Picture Credit: Planet

The corporate’s long-term gross margin goal is 80% to 85% (COGS of 15%-20%, per the deck), however you’ll be able to see how lengthy it takes to get there. This poses an fascinating challenge for the enterprise capital world.

Particularly that corporations like Albedo are going to wish lots of money and time to construct out their constellations and get to scale. And, I presume, to scale to the form of gross margins that software program corporations can generate from their first day promoting product.

That is one purpose why there’s a lot cash chasing software program merchandise with even a touch of sturdy progress; high-margin recurring income is the enterprise equal of a cheat code in relation to worth creation. Thus each investor desires to shovel cash into it. satellite tv for pc tech, whereas tremendous fucking crucial basically, merely is dearer and slower-burn.

My query: Is software program so good at producing enterprise capital returns that different types of startup work will battle to compete for consideration and capital? Are they already?


Lastly, Future. Or extra exactly, Future’s future. I’m curious concerning the a16z publication.

Because it launched I’ve checked in a number of instances every week, hoping to see what was popping out of the enterprise capital agency’s collective thoughts. I accomplish that not solely as a result of I’m an enormous dweeb — I’m! — but in addition as a result of after all of the hand-wringing that I’ve needed to examine how the media hates tech — nope! — I used to be curious what a cosmically well-funded enterprise group would construct. It has hired some great people, in any case.

It seems that we’re in between publishing cycles on the Future weblog. The final items of Essential Content material got here out practically a month in the past, and its most up-to-date entry is dated June 25th. And that piece is only a observe promising extra content material in July.

All of it feels a bit flat? Given the finances, promise, fancy area and variety of individuals within the a16z world who ought to have issues to say? Why not make extra phrases seem? Let’s examine what July brings.

Okay that is sufficient from me for the week. Hugs, and discuss to you Monday morning on the pod.

Your buddy,


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Raushan Kumar
A Cook, Software analyst & Blogger.


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