The Power of the Portfolio: VCs and Entrepreneurs

Kudos to the venture-capital (VC) firm First Round Capital for offering its entrepreneurs an exchange fund: If First Round invests in your startup, you can exchange a small percentage of your own company shares for shares in a fund tied to the total First Round portfolio’s performance. As First Round’s managing director Josh Kopelman said, “When I was an entrepreneur, I remember the feeling of having all my eggs in one basket — and it is our hope that this fund will remove some of that stress.” Assuming the details of the plan are consistent with its spirit, it will be a great option for entrepreneurs and a positive differentiator for First Round.

That said, beyond the normal VC role of facilitating relationships among portfolio companies, how else can VC firms leverage their portfolio-holder position on behalf of those in the portfolio? For example, could a VC firm share a health-care/benefits program across all its early-stage startups? Each startup would pay its own way, just as if the startup had its own program. However, a portfolio-wide program would have better terms due to its size, would eliminate the cost and hassle of each startup finding and establishing its own plan, and would offer COBRA for individuals at failed startups (who ordinarily would be out of luck, since COBRA is predicated on the continued existence of a company).

I am sure other examples exist, and I look forward to seeing them emerge for the benefit of entrepreneurs and VCs alike.

Coding for an Audience

In Peter Seibel’s Coders at Work, I particularly enjoyed a story from Bernie Cosell, who was on the team that wrote the original routing software for the Internet. He was talking about a theme that occurs throughout the book, the idea that a good program is written not just for the computer but also for the humans who may need to understand the program or change it later—including the program’s original author:

At some college they had a two-semester course from September right through May and they had you work on some fairly hard program at the beginning. What they didn’t warn you was in April they were going to make you work on the program again, having now really run you through the hoops on other things. The idea was for you to be stunned at how hard it was to remember whatever it was you thought you understood perfectly clearly just six months ago.

This lesson is inevitable in any programmer’s career: You must write code for an audience, at minimum for the future you. It’s a well-known concept in software development, and is probably said often in various classes. But I suspect it’s rarely learned until the student gets burned by his or her own code, and that’s what the above does safely.

So, to whichever school did it, I thank you on behalf of the students and their future employers.

Coders at Work by Peter Seibel

When I was eleven years old, my seventh-grade math teacher showed me this:

10 PRINT “HELLO”
20 GOTO 10

When run, the program displayed on the screen a never-ending column of “HELLO”:

HELLO
HELLO
HELLO
HELLO
HELLO
...

As I made the mental connection between the two lines of code and the output on the screen, I realized I could make it print “GOODBYE” instead of “HELLO.” And probably do other things.

The year was 1979. Relatively few people, and fewer kids, were using computers. As far as I could tell, writing a program was like making a machine, except the program was made of instructions, not physical parts. And that two-line program went faster than anything I’d seen a physical machine do. And like that stream of “HELLO”s, it could go on infinitely. And yes, it definitely could do other things.

Thirty years later, having explored many of those other things—only to realize how immensely more there is—I have not lost the fascination for the computer as a frontier to new possibilities. It’s a frontier that keeps extending as computers become more powerful and our understanding increases for how to harness that power.

With that preamble, I can now tell you about Coders at Work by Peter Seibel. It’s a book targeted to whatever is behind the above story, that impulse to explore what computers can do. The book features extended conversations with fifteen notable programmers, following their paths from first programs to famous projects, along the way discussing the craft, the ideals, and the challenges of their work. (That word work deserves qualification, because almost all the subjects were somehow smitten with computers first, then found a way to get paid to do what they loved.)

To appreciate Coders at Work, you need to be a relatively experienced programmer, because the shop talk does not come annotated. You also need to be interested in the old days—punch cards, Fortran, teletypes, time-sharing—because many of the conversations linger in the pre-PC era. And of course, you need to care about what makes for good programs and good programming. If those criteria work for you, the book will.

Here is the book’s Web site, which has some quotes from the various interviews, and the link at Amazon.

Recovering Energy from Shock Absorbers (Levant Power)

In the past, I’ve written about harvesting power from human motion, including the idea of generating power from vibrational energy imparted from vehicles to road structures like overpasses. Some former MIT students, now entrepreneurs, have hit on a smart variation of this idea: They harvest power not via the road structures but via the vehicles’ shock absorbers.

From their company’s Web site:

Levant Power Corp. has identified an alternative energy source previously
untapped by vehicles: the suspension system. The energy of a vehicle traversing varying roads and terrain is significant and currently dissipated as heat through conventional shock absorbers.

Our product, GenShock, recovers this energy and utilizes it for fuel economy gains, providing additional onboard electricity. In addition to extending a vehicle’s range, GenShock improves ride quality via an adaptable, variable-damping suspension. GenShock is a turnkey replacement for standard shock absorbers, requiring minimal installation time and little to no maintenance.

File that under, “Ideas, Good.”

Book Review: Invictus by John Carlin

You’ve probably heard of the movie Invictus, maybe seen it. I just read the book: John Carlin’s Playing the Enemy, now reissued under the title Invictus. I suggest you read it too. (Those who follow this blog know I rarely make unqualified recommendations. This is one.)

Invictus is the true story of Nelson Mandela’s journey from prisoner to president to uniter of South Africa, a country that seemed destined for civil war as apartheid gave way to majority rule in the 1990s. The minority whites had a lot to lose, and many of Mandela’s black supporters wanted to do the taking. Yet Mandela steered a course that balanced the aspirations of the new majority with respect for the whites as partners in a new South Africa.

The process crept along a thin edge, always a slip away from something like Northern Ireland or the Balkans, until June 24, 1995. On that day, Mandela’s most unlikely achievement culminated on a rugby field. To bewilderment from all sides, he had earlier adopted the country’s national rugby team—previously a symbol of white rule and still with no black players—as his own, as everyone’s team. He had inspired the organization, and the players personally, to reach out to black fans, to sing the black version of the national anthem, to be something that represented the whole nation. Now, against heavy odds, the team would play and win the rugby world cup final in Johannesburg. The day would be remembered as much for blacks and whites chanting Mandela’s name in unison as for the victory on the field.

In the words of a Mandela ally, “This was the moment when I understood more clearly than ever before that the liberation struggle of our people was not so much about liberating blacks from bondage, but more so, it was about liberating white people from fear. And there it was. ‘Nelson! Nelson! Nelson!’ Fear melting away.”

Carlin structures Invictus around this unlikely ending, tracing not only Mandela’s path to that rugby field but also those of his friends and foes, black and white. Through their intertwined stories, deftly told, the historical facts and lessons emerge. Among them are the possibility that deeply divided peoples can unite, that a single leader can make all the difference, that the misdeeds of the past don’t guarantee misdeeds of the future.

When this is the stuff of nonfiction, we are all the better for it.

Here’s the book’s link at Amazon.