Tribe Capital Essays

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    A Quantitative Approach to Seed Investors

    Interested in the 2019 Institutions + Individuals lists? Let us know! Who should we spend more time with? When investors underwrite seed-stage companies, the new company’s team and product, and even market, might have not yet materialized. Even with so much uncertainty, investors still develop confidence, but how? If you asked many seed investors, you would get just as many distinct answers, but the most concrete (and possibly only) unifying themes would be special relationships with talented entrepreneurs and a differentiated deal network.  At Tribe, we’re always searching for businesses

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    A Quantitative Approach to Product Market Fit

    “The only thing that matters is getting to product-market fit… Product-market fit means being in a good market with a product that can satisfy that market.” – MARC ANDREESSEN Marc Andreessen wrote these words back in 2007, coining the term product-market fit. While the concept has gained widespread adoption there remains a lack of consensus on what it means at a more precise level. For an early stage company, it is still really hard to both recognize the signs of product-market fit, as well as to optimally execute towards amplifying

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    How to Transform and Build a People Platform

    To the casual spectator, Facebook is having a terrible year. Besieged by privacy scandals, the company was torn into by Congress, the press, and the public alike. To make things worse, the founders of WhatsApp and Instagram left Facebook in what seems to be a complete rejection of the company.  The divide was so deep that WhatsApp co-founder and CEO Jan Koum forfeited up to $1.2 billion so he could leave the company last September—three years after selling his startup to Facebook for $19 billion. WhatsApp’s other cofounder, Brian Acton,

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    Units of Time are the New Currency

    “The key to investing…..is determining the competitive advantage of any given company, and, above all, the durability of that advantage.” Warren Buffett Today we’re seeing that a moat—a barrier that protects a company from low-cost competitors or new, disruptive technology—isn’t enough to build a lasting business. A moat simply buys a company time to figure out the next great business. Just like the invention of field artillery in the 16th century rendered moats obsolete, technology today is grinding down barriers to competition. Technology makes the moat of traditional business a mere jumping

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    The Hive is the New Network

    Facebook, Twitter and Instagram all started life as revolutionary networks that brought existing real-world relationships online. Today, they are aging utilities, powering an outdated version of the social internet. As social networks like Twitter, Facebook, and Instagram grow larger, they skew disproportionately toward supernodes—celebrity, meme and business accounts. An estimated 8% of all accounts are fake spam bots. The average Instagram user posts 2.69 times a day, while the average user with over a million followers posts 8.58 times. 80 million photos are posted a day, but the average engagement rate

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    Innovating at Scale: The Companies That Don’t Let Size Slow Them Down

    Nothing lasts forever — not even unicorns. But some unicorns live long lives. The life cycle of consumer products is depressingly predictable. A product becomes a hit because it resonates with a generation. And as time goes on, that generation matures and is inevitably replaced by a fresh set of customers with distinct tastes and perspectives. The product, a victim of its own success, eventually hits a ceiling. In technology, the cycle is on constant repeat. Once a consumer product starts to gain a large audience — it risks disruption

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    The Three Phases of Consumer Products

    First you want it. Then you need it. Then everybody can’t live without it — like a utility. Right now Facebook’s developer conference, F8, is underway, and it is massive. But I’m thinking back to the early days of the company. Facebook was the first company (as far as the Internet knows) to create a growth team. There’s no argument that its team has been effective at helping get sustainable user growth. What people forget is that before focusing on growth, Facebook reached what Marc Andreessen calls product-market fit. Product market fit is, “being