The Longest View

Notes on Startups, VC & Entrepreneurship

Hey Everyone - Testing out a new, newsletter format here that I’m calling, “The Longest View.” I got inspired to test this out after stumbling across the fantastic AI newsletter from Jack Clark (Co-Founder of Anthropic), Import AI. We’ll see how this goes, but I plan on The Longest View being more of the quick hits and reactions to news from the tech, VC, and startup ecosystem that I’ve read the prior week. I already consume a lot (a metric shit-ton) of content in my day to day job, so I figured why not synthesize it into one place? I’m experimenting with this in real time and I’m open to feedback, so feel free to just drop a comment at the end. Okay. Here we go.

Apple Vision Pro Pre-Order: The Apple Vision Pro Pre-Order launched on Thursday this past week. It’s not available till February 2nd, but by all intents and purposes there seems to be material demand for a mixed reality headset that retails for $3,500. 

There’s various reports online of the initial 80K units selling out between 15 - 30 minutes. Check them out here, here, and here. You can chalk it up to a savvy marketing playbook underpinned by scarcity, or you could frame it as genuine demand. Either way, Apple made bank. See below for a brief sensitivity analysis of total revenue based on total unit sales. 

Why is it important? Apple (as we all know) has a long history of evangelizing and leading the tech ecosystem. There’s a non-zero chance that the launch of the Apple Vision Pro is a historically significant event. For historical context (and brief comparison to the iPhone), the first iPhone sold 270K units in its first week and crossed the 1M mark after 74 days. It retailed for $499. It sparked the mobile computing revolution and it’s now estimated that more than 5Bn people around the world own a mobile device. That’s ~63% of the world’s population.

The iPhone changed the course of human history and it’s a fair question to ask if the Vision Pro will do the same. A few things that I think are interesting and worth revisiting in this moment are:

1. Does the Apple Vision Pro become a status symbol in high cost of living urban areas similar to how AirPods did in 2016/2017?

2. Will we see new versions of apps like Angry Birds, Clash of Clans, Flappy Bird emerge on the app and pull it in a gaming focused direction? Or does the product become productivity focused? Does it become the default computer for households and individuals? If so, why?

3. What will the effect on dating and dating apps be? Tinder doesn’t become the phenomena it was (and still is) without the iPhone. Does a new player enter the arena?

4. What are the picks and shovels to support the application layer of the Vision Pro ecosystem? Who will be the next generations of Hotjar, Amplitude, Looker that provide the analytics layer of a mixed reality world?

5. Finally, is the Apple Vision Pro - net good, or net bad for society? It’s very hard to argue that we truly need this technology and it’s not as large of a step function difference as the pre-internet, post-internet world. Nor does it feel as large of a step function difference between a pre-mobile, post-mobile world. But in the event it does take off, and in the event that 10% of the world has some version of an Apple Vision Pro. Is that good?

Unify GTM Launches: Unify, a startup backed by OpenAI, Thrive Capital, and Emergence Capital announced their $6.6M seed round. Full disclosure, I'm a very small (but very proud) early investor in Unify. I first got to know Austin, the CEO, back in 2022 in (of all places), twitter DMs.

Okay cool, so what do they do? Unify powers warm outbound for high growth tech companies. To use their own language, “Unify is the first platform that powers warm outbound end-to-end. We make it easy to track all the buyer intent signals relevant to your business, automatically prospect for contacts that fit your target personas, and engage them with 1:1 personalized messaging.”

Why is this important? Companies like Unify are the emerging AI application layer. Over the next decade, we’re going to see a whole host of companies be built from the ground up that increasingly look to platforms like Unify to gain operating leverage. Startups like Unify are focused on horizontal workflows, but we’re also seeing the vertical AI landscape start to take shape as well. I’m seeing it day to day with entrepreneurs focused on building AI applications as varied as a co-pilot for accountants to knowledge extraction tools for complex debt transactions. 

Seen & Done, Real world applications of AI: If you ask around or go looking, you’ll start to see real world use cases of AI that go beyond just creating fun images in DALL-E. I’ve heard of DTC entrepreneurs bootstrapping to $1M of sales in a single year and using ChatGPT to test marketing copy, create product specs, and generate stock imagery. I personally tested an automation tool for investment analysts that took one of my tasks down from ~73 minutes to ~10 minutes. The wildest thing I’ve heard of is a law firm in Brazil setting up their own custom workflows to automate their most routine requests.

All of these observations have led me to a point where my firm stance is that we should all be asking ourselves, what happens in a world where 20% of professional services jobs become obsolete? 

It’s not far off to believe that a 20% reduction in headcount over the course of a decade is possible. Just look at the New York Times. Between 2000 and 2010, the New York Times cut its overall staff by 47%. 

Google was started in 1998 and went public in 2004. Innovation doesn’t occur in a vacuum. There will be winners and losers, and companies like Unify (among others) are looking to enable the next generation of winners. No different than what we’ve seen in the past.

How long does it take for vertical SaaS companies to cross $100M ARR?

I was curious about this question so I looked it up. Out of a sampling of 9 public (or formerly public) vertical SaaS companies it seems like the average years it takes to cross $100M of ARR is 9 years

• DealerTrack crossed $100M of ARR in 2005, 4 years after being founded

• Veeva Systems crossed $100M of ARR in 2013, 6 years after being founded

• Toast crossed $100M ARR in 2017, 6 years after being founded

• Shopify crossed $100M of ARR in 2014, 8 years after being founded

• Benchling crossed $10M of ARR in 2021, 9 years after being founded

• AppFolio crossed $100M of ARR in 2016, 10 years after being founded

• Alarm.com crossed $100M of ARR in 2013, 13 years being after founded

• Slice crossed $100M ARR, 14 years after being founded

• Procore crossed $100M ARR in 2017, 15 years after being founded

When founders and VCs say raising venture capital is a decade long journey… 

Turns out it truly is!

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That’s it for me. Hope you all enjoyed this. More likely than not I’ll continue this exercise next week!