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Billionaire Investor Peter Thiel Is Doubling Down On Bitcoin – Here’s Why

Bitcoin and cryptocurrency investors have been struggling this year to both justify past crypto investments and make new ones.

The bitcoin price, under pressure from the likes of Facebook’s libra project and the ever-present threat of a regulatory crackdown, soared in the first six months of the year only to fall back again.

Some investors have not been put off by bitcoin’s roller-coaster year, however, with billionaire PayPal cofounder Peter Thiel among new backers of Layer1, a renewable energy-focused bitcoin mining operation based in San Francisco.

This week, Layer1 revealed it has raised $50 million at a $200 million valuation from Thiel, Shasta Ventures and other undisclosed bitcoin and cryptocurrency investors, adding to a previous $2.1 million seed round that included Thiel, as well as venture capital company Digital Currency Group.

Layer1 is aiming to challenge the perceived wisdom that bitcoin mining the in the U.S. will not be able to compete with regions such as China, where some 60% of bitcoin mining operations are currently located, with some research suggesting that number could be even higher.

Layer1, which has pivoted to renewable energy bitcoin mining from a previous focus on the development of programmable money and store-of-value applications, wants to bring wind-powered bitcoin mining rigs to West Texas by early next year.

“According to industry research, over 60% of bitcoin’s hash rate and 100% of bitcoin hardware production are located in China,” Layer1’s cofounder and chief executive Alexander Liegl wrote in a blog post announcing the fresh funding.

“Less than 5% of bitcoin’s hashrate and 0% of hardware production are located in the United States.”

China dominates not only bitcoin mining but also the manufacture of computer chips and other equipment needed for the process.

Bitcoin mining uses huge amounts of electricity to both fuel the powerful computers required and keep them cool, making hotter climates in developed nations less appealing.

“The future of bitcoin mining lies in the heart of the United States: Texas,” Liegl wrote.

“This is where world-class electricity prices, friendly regulation, and an abundance of renewable energy sources meet. It is here that we are rapidly scaling our mining operations to bring as much hash rate as possible back to the United States.”

Layer1 has been buying up land in Texas to build its own electricity substations and is creating its own processing chips with a Beijing-based semiconductor company as it puts together its mining machine infrastructure.

Renewable energy bitcoin mining is being used by others around the world, with Germany-listed Northern Bitcoin mining bitcoin and other cryptocurrencies deep within a Norwegian former metal mine using hydroelectric power and natural cooling.

However, there have been previous failed attempts to bring large-scale bitcoin mining to North America.

Earlier this month, Virginia-based bitcoin mining firm BCause Mining filed for bankruptcy after pledging to invest $65 million in to its U.S. business in 2018.

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I am a journalist with significant experience covering technology, finance, economics, and business around the world. As the founding editor of Verdict.co.uk I reported on how technology is changing business, political trends, and the latest culture and lifestyle. I have covered the rise of bitcoin and cryptocurrency since 2012 and have charted its emergence as a niche technology into the greatest threat to the established financial system the world has ever seen and the most important new technology since the internet itself. I have worked and written for CityAM, the Financial Times, and the New Statesman, amongst others. Follow me on Twitter @billybambrough or email me on billyATbillybambrough.com. Disclosure: I occasionally hold some small amount of bitcoin and other cryptocurrencies.

 

Source: Billionaire Investor Peter Thiel Is Doubling Down On Bitcoin—Here’s Why

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Recorded on September 5, 2019. Peter Robinson opens the show by asking Thiel’s views on his own essay “The Straussian Moment.” (Essay link: https://www.evernote.com/shard/s542/c… responds by saying that people today believe in the power of the will but no longer trust the power of the intellect, the mind, and rationality. The question of human nature has been abandoned. We no longer trust people’s ability to think through issues. Thiel notes that this shift began to take place in 1969, when the United States put a man on the moon; three weeks later Woodstock took place, moving the culture in the direction of yoga and psychological retreat. Thiel further adds that there was still hope that things would open up for the world in 1989, when the Berlin Wall fell and the Soviet Union collapsed, but that the leaders of China and other East Asian countries did not accept that openness would solve their problems. Instead they learned the opposite lessons from those events: that if you open things up too much, then things fall apart. Thiel ends the interview by noting that there is nothing automatic or deterministic about how history happens, and he expresses his views that economic growth plays a vital role in a country’s future. For further information: https://www.hoover.org/publications/u… Interested in exclusive Uncommon Knowledge content? Check out Uncommon Knowledge on social media! Facebook: https://www.facebook.com/UncKnowledge/ Twitter: https://www.twitter.com/UncKnowledge/ Instagram: https://instagram.com/uncommon_knowle…

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He Built A $1 Billion Business Where All 700 Employees Work Remotely

Sid Sijbrandij knows a thing or two about building, scaling and even walking away from companies. His current venture is doing over $100 million in revenue and is valued at over $1 billion.

Originally from the Netherlands, Sid Sijbrandiij is now the founder of one of Silicon Valley’s unicorns that is powering the web through developers worldwide. It’s not his first startup rodeo either.

Sid Sijbrandij recently appeared on the DealMakers podcast. During the exclusive interview, he shared his entrepreneurial journey, the process of finding cofounders, bootstrapping versus raising millions, his addiction to fast-growth startups, and many more topics.

Seizing Opportunities

Sid Sijbrandi seems to have always had a gift for spotting business opportunities.

During high school, he studied applied physics and management science. He chose a kind of program that blends the benefits of an M.B.A., with getting good at several engineering disciplines.

In his first year at college, he also started his first company.

The idea came from a fellow Ph.D. student that had made an infrared receiver you could use to skip to the next song on your computer (the only thing that played an MP3 song at the time). He started buying these infrared receivers from him and selling them in the U.S. You’d send him an envelope of dollar bills, and he would then send you a printed circuit board.

Ultimately, his two cofounders didn’t agree on growth plans concerning hiring more people. Sid wanted to hire faster, so he didn’t have to spend as much time on it, while his cofounders wanted to optimize for free cash flow. They ended up parting ways amicably.

The Two Most important Things for Launching with Cofounders

Sid has experienced several startups and says his two big takeaways when it comes to cofounding a company are:

1) To be smart with the shares

2) To be sure you and your cofounders are aligned in vision

For example, automatically making everyone an equal cofounder, even if they come in way later in that process, can be a mistake.

Sid says it is important that shares “are aligned with their contribution to the company. It’s very important if you start a company to have vesting of your shares as well.”

This helps avoid the free rides, because if someone leaves with all the equity, then people that need to invest like VCs are going to be like, “Why am I investing for just 50% remaining of the business.”

In the Netherlands, Sid didn’t find the goal of local companies to grow really fast. If you do want to grow a company really fast, he says it is beneficial to be somewhere like the Bay Area, where everyone just assumes that is the goal.

Not just your cofounder, but also your accounts person and your lawyer, and everybody else requires the growth mindset.

Passion for Growth

After graduation, Sid spent a few months at IBM and could have stayed there. He had an interest in strategy consulting, as well as building a recreational submarine.

He made a balanced scorecard of all the different ways to make that decision. One of the criteria being, “Is this a good story to tell in a bar?” He showed his dad who said it was a ridiculous way to decide on your career but was very supportive either way.

So, he called someone interested in a submarine venture. His pitch was, “Look, you should really hire me because I have a job offer from IBM. Otherwise, I’ll start working there, and we both don’t want that.” He got the job.

He built the first onboard computer for the submarine. Today, U-Boat Worx is one of the biggest builders of recreational submarines. If you go on a cruise, and they have a submarine, it’s likely from U-Boat Worx.

Still, after five years, it just wasn’t growing at a pace that kept Sid interested. He then went on to do a part-time stint on an innovation project with the government as a civil servant.

During this time, he really got to know himself, and how fast-growing companies with a continuous string of problems to be solved were what kept him interested.

Funding Your Startup

After starting and selling app store Appappeal, Sid turned open-source software GitLab into a fast-growing venture that is on its way to an IPO in 2020.

He took the proceeds from his previous venture, doubled it in bitcoin, and began bootstrapping GitLab.com.

Sid got the first few hundred signups through an article posted on Hacker News. Then together with his cofounder applied and got into Y Combinator. The race to demo day, where they would present in front of top tier investors, was on.

Compressing their three-month plan into just two weeks, the GitLab team had a highly successful demo day, landing Ashton Kutcher as an investor.

There was so much interest in their seed round, they rolled right into the Series A financing round. They’ve since followed that up with a B, C and D financing rounds, raising a total of $158 million at $1.1 billion valuation.

Today, some of their investors include Khosla Ventures, Google Ventures, August Capital, ICONIQ Capital, 500 Startups, and Sound Ventures to name a few. It doesn’t get much better than that as a hyper-growth startup.

In order to do this, Sid and his team had to master storytelling. This is being able to capture the essence of the business in 15 to 20 slides. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

Embracing The Remote Work

Sid states they “don’t do in person.“ At Gitlab they encourage having meetings with webcam. They believe there’s something to see in the other person even if it is via video.

To put this into perspective, every day, employees have a company call, and it’s a thing you do with a limited set of people. In this regard, there are about 20 in each group, and they just hangout.

During the group calls there are all types of topics discussed that vary from movies to magazines. Topics are not necessarily work-related.

Sid and his team very much believe that their company is more than just, “Hey your work…”

As part of Gitlab‘s culture, the social interaction plays a key role and they have a lot of ways in which they facilitate this inside the company. Even if this happens remotely.

M&A Made Simple

Recently Sid and GitLab have been very active when it comes to acquisitions on the buy-side. That includes Gitorious in 2015, Gitter in 2017 and Gemnasium in 2018.

When it comes to acquiring companies, they’ve made the process incredibly simple, and are actively looking for more companies to buy.

In this regard, they like to acquire teams that have built a product before. Preferably a team that made a great product, but didn’t get distribution. Especially because typically they shut their existing product down.

To make things easier, they have an acquisition offer page. It even includes a calculator, so you can go online and calculate how much they’re offering.

Listen in to the full podcast episode to find out more, including:

  • When to pull the plug on your startup
  • The advantages of SAFE notes for raising money
  • How GitLab does meetings and culture around the globe
  • Why they pay based on where team members live
  • Tips for recruiting top engineers
  • Why you should read the GitLab handbook

Follow me on Twitter or LinkedIn. Check out my website or some of my other work here.

I am a serial entrepreneur and the author of the The Art of Startup Fundraising. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley

Source: He Built A $1 Billion Business Where All 700 Employees Work Remotely

11 Websites That Will Make You Smarter About Money

Not everyone has a financial adviser, and not everyone has the time to read a personal finance book. Luckily, there’s the internet. We’ve made learning about money easier for you by compiling a list of some of our go-to websites for money advice……..

Source: 11 Websites That Will Make You Smarter About Money

Meet the Woman Who’s Boosting Arizona’s Mom-and-Pop Business Culture

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Kimber Lanning stands at just 5 feet 1 inch. But in the Arizona economic landscape where she acts as a fierce advocate for local economies, she is a giant.

In 2003, Lanning started Local First Arizona. She was the only employee, and didn’t take any salary. Now, with 3,200 members, it is the largest coalition of local businesses in the country. The coalition’s staff of 24 manages programs ranging from an annual local business fall festival to the state’s first directory of locally grown food to a program in Spanish for micro-entrepreneurs.

“I saw how unfair the competition is for local businesses.”

Lanning is widely recognized for her work. Even though she finds traditional economic development planners to be frequent adversaries, in 2014 the International Economic Development Council awarded her a Citizen Leader of the Year Award. She considers that a turning point in planners’ recognition of the value of local businesses. Arizona Business Magazine named her one of the 50 most influential women in Arizona, and the American Planning Association named her Distinguished Citizen Planner for her work on the reuse of old buildings.

In November, at a conference of the nonprofit Business Alliance for Local Living Economies, for which Lanning is an incoming co-chair, Lanning told me of the sources of her passion for local business.

Fran Korten: Kimber, what propelled you to start Local First Arizona?

Kimber Lanning: I was angry. I wanted to expose the horrible subsidies being given to big corporate chains. I own a record store that I started when I was 19. And I saw how unfair the competition is for local businesses. For example, in Glendale, Cabela’s got a $68 million subsidy. Bass Pro got $32 million. And I began to see the fallout. You’d read that Bass Pro is to create 160 jobs. Yet, I’m going over to Lorada’s Army Surplus and they’re closing. They say the city just took the income tax, the property tax, the sales tax that they’ve been paying for the 30 years and incentivized the competition to put them out of business. So I wanted to level the playing field for locally owned businesses.

I also wanted to strengthen people’s connection to place. In Arizona, a lot of people have moved here from Chicago. They are always talking about how great Chicago is. So I asked people why they love Chicago. They would say, “In my old neighborhood, I knew all the store owners.” One guy said, “I had the same barber for 40 years, and I come out here to Phoenix and all you guys have is Supercuts.” And I said, “This is so unfair. You give me 20 minutes and I’ll find you 20 barbers.” And he said “Really? Where?”

So I realized I’ve got to introduce these people to my world and the rich culture we have amongst the locally owned businesses. In Phoenix I put together a fall festival where I had all these businesses in one place. We are so geographically spread out that you never see them in one place. Put them all together and people started to go, “Wow. There is some cool stuff going on right here.”

“Don’t support mom-and-pop because mom and pop need you—support them because you want your children to have a job.”

Korten: You make the connection between buying local and having a thriving local culture and economy. Do you think other people see that?

Lanning: Generally they don’t. One of my mentors, Eddie Basha, told me this story. He owned a group of local grocery stores. The husband of a couple who were long-time customers died. Eddie called the widow and offered to provide all the food for the service. She was incredibly grateful. But he also told her, “I can’t bring the drinks.” And she said, “Oh, don’t worry, I’ll pick up the drinks at Costco.” When I tell that story, people in the audience gasp because they’ve done exactly that. We’re so disconnected from how the economy works that we believe we can put money into these big corporate entities and our friends who donate food when your husband passes away will survive and be there for you. And I’m here to tell you that they won’t.

Korten: After the Trump election, a lot of people are paying more attention to jobs in rural areas. You’re based in Phoenix. How does Local First Arizona work in rural areas?

Lanning: Rural towns have massive economic leakage. Amazon is the biggest threat facing rural America. People in rural communities tend to either buy online or travel to Tucson or Phoenix to spend their money. They don’t connect that to the fact that the town can no longer balance the budget because they don’t have sales tax revenue coming in and the storefronts are boarded up. You know, the jobs they lose aren’t just baristas. It’s the graphic designer, the payroll service provider, the accountant. Those jobs go away when you lose local businesses. I always tell people, don’t support mom-and-pop because mom and pop need you—support them because you want your children to have a job.

At Local First Arizona we make sure that these local businesses have the tools and resources they need to compete. One program we do is Mythbusters. People in rural areas will tell you, “I can’t buy this here.” So we reintroduce them to their town, showing what they can buy locally. And we dispel the myths about how expensive it is. I had a guy just barely hanging on, selling appliances in the town of Ajo. Everybody said he’s too expensive. They go buy in Tucson, which is two hours away. So I compared his prices with those in Tucson. Sure enough he was more expensive. But I factored in my gas to get to Tucson and back and the fact that, say, for a washing machine, I’d have to get a trailer to bring it home. And I’d have to pay somebody to haul away my old one, whereas he would do that for free. You stack those up and he was actually cheaper. After our Mythbusters program, his business is up significantly.

Korten: Arizona has a lot of Latinos. How do you reach them with your programs?

Lanning: Our Fuerza Local program is a six-month business accelerator program taught in Spanish. We help Latino micro-entrepreneurs strengthen their businesses.

Korten: What’s an example of a business you have helped with that program?

Lanning: We have many remarkable examples. We had a wedding cake baker whose business was all word of mouth. She had no marketing and no formal contracts. She had been sold three kinds of insurance that she didn’t need and was paying 48 percent interest on her loans. She had no health permit, no business permit. She was just a great baker. People would ask her to bake their wedding cake. She would quote, say, $500. But she’d go to deliver the cake and they would say, “We’re sorry. We only have $275.” So she would leave the cake and just feel sad.

After graduating from our Fuerza Local program, she enrolled in a credit union where she got a 6 percent interest loan and paid off all of her bad loans. We got her the right kind of insurance. GoDaddy donated a website. We got her up on Facebook and helped her develop contracts. I remember her face when I explained that she needed to ask for 50 percent down when a customer placed the order. She said, “I can’t do that.” I said, “Don’t bake a thing until you’ve got 50 percent in your hands.” Now, three and a half years later, she’s in a commercial kitchen. She has six full-time employees and she has a contract with Bashas’, the biggest locally owned grocery store.

“Both the millennials and the baby boomers are speaking loudly with their wallets.”

Korten: Does anyone oppose your work in building up local businesses?

Lanning: Absolutely. One group is the traditional economic developers. Their whole mission is creating jobs by giving away massive corporate subsidies. Just like everybody’s jockeying for Amazon right now.

But that’s changing. In 2014 the International Economic Development Council awarded me a Citizen Leader of the Year Award. That was an acknowledgement that local economy work is important. Now they’re bringing in more people at their conference who are talking about a new way of doing economic development.

Korten: Who are your biggest supporters?

Lanning: Local businesses, of course. Moms who care about healthy food and the future for their children. Young people who want to make change in the world. They are jumping in with both feet because they don’t like the way the corporations are treating the world. But they exempt Amazon from their concern with big corporations because they like the convenience.

Both the millennials and the baby boomers are speaking loudly with their wallets. Generally they want to place relationships first. They also want a unique experience. They may not be thinking about voting with their dollars, but you look at a comparison of craft beer versus Budweiser sales and you will see that people are voting for something unique. So when you ask who is with us, it’s the people who are choosing relationships.

I believe the American public is being divided into two camps—one that prioritizes convenience, the other that prioritizes relationships. The latter is something the media never anticipated. They were beating the death drum for local independent businesses. But local businesses are climbing back. More record stores opened in the last two years than opened in the 20 years before that; more bookstores have opened; more independent coffee shops have opened than Starbucks branches.

“People can see that the dominant system is failing them and their families.”

Korten: Do you feel that local businesses advance sustainability and justice?

Lanning: I think local business owners inherently care more about the community than a nonlocal corporation that’s answering to shareholders who don’t live in the community. They’re more likely to care about long-term sustainability because it impacts their children.

Sometimes sustainability and justice are baked right into the programs that support local businesses. Take our program to repurpose old buildings. There’s nothing greener than keeping an old building rather than tearing it down and building a new one. There’s a study called “Older, Smaller Better,” which demonstrates that communities that preserve their older building stock have more jobs per block. They support more businesses owned by people of color. They provide a unique sense of place. They are vital incubator spaces for small businesses. People say we want more entrepreneurs, but then they mow down the older buildings and put in big ones where there’s no place for entrepreneurs. With the cities of Phoenix and Tucson, we’ve streamlined the process for a new business to open in an older building. Phoenix has the most progressive adaptive reuse program in the country. We have about 85 new businesses right in our city center to show for it.

Korten: How did you get the city to keep the old buildings?

Lanning: I just said if we don’t protect our older buildings that usher in entrepreneurs and create a unique sense of place, we’re not going to be competitive. That word “competitive” makes my conservative audiences sit up and listen.

One issue we had to deal with in order to keep the old buildings was the requirement that stores have ADA accessible bathrooms. If you put bathrooms in each of these small stores, it would take up a third of the floor space. I said why can’t we do a district bathroom so the building owner only has to put in one set? I got the attorneys who defend the Americans with Disabilities Act to come to the city council and agree on that solution. With this change and other new policies, we’ve saved countless buildings and made it easier for lots of new businesses to get their doors open.

Korten: You have a passion for local businesses. Do you think it’s possible to reach new audiences with this perspective?

Lanning: Yes. People can see that the dominant system is failing them and their families. And it’s failing the Earth. They’re looking for something that they can really put their shoulder behind.

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