Weekend Briefing No. 73

Welcome to the holiday weekend. Happy 4th of July!

Congratulations to Jocelyn Wyatt! She won a free, signed copy of my book Profit & Purpose just for liking a photo on Instagram. Keep checking out Instagram for cool stuff.

 

WEEKEND BRIEFING

 
Hacker philanthropy. Sean Parker has always been a hacker since the days of Napster. Now he’s taking those skills into the philanthropy world and inviting others to give in a new way. It focuses less on getting your name on a building than actually creating measurable impact on solvable issues. It’s a hyper-rational and hyper-pragmatic view on giving for a new generation of Silicon Valley philanthropists. It’s built around the core tenants of (1) start early, (2) deploy capital quickly, (3) remain small and bet big, (4) focus on solvable problems, and (5) follow market logic. Learn more in his Wall Street Journal essay.

 

What would grandma cook? This is the question that Dan Kish, head chef at Panera Bread is asking these days. Since he has joined Panera, they have been the first major chain to stop serving poultry raised with antibiotics and trans fats. This has prompted the rest of the industry to follow suit. Now they are trying to eliminate high fructose corn syrup from their beverages, which puts them at odds with Pepsi. “We’ve told them we have to fix this, please be our partner,” Mr. Kish said of his talks with PepsiCo. “We’ve had countless meetings with them about it. And we’ve said with you or without you, we are getting high-fructose corn syrup off our menu.” Learn more inDavid Gelles’s amazing new column Revalued about progressive values in the Sunday Business section of the New York Times.

 

State of impact investing. Cambridge Associates in collaboration with nonprofit group Global Impact Investing Network, released a report on impact investing this week. Overall, it’s not a perfect picture, but it seems that under the right circumstances impact funds can deliver the same or better returns than traditional funds. Impact funds that delivered top quartile returns have generally performed in line with the comparable universe of top quartile private equity and venture capital funds. The lesson: fund managers and timing matters. Impact funds seem to perform better when they are smaller. Impact focused funds valued at $100 million or less posted a 9.5% pooled net internal rate of return, outperforming the 4.5% of traditional funds of the same size. This raises a question, can impact investment funds deliver beyond a certain scale? Read more in this Wall Street Journal article.

 

State of seed investing. First Round Capital just publically released its most recent letter to its Limited Partners discussing the state of seed stage investing. They argue that seed stage valuations have increased at a rate of 20% year on year for the last 10 years. They predict that the market-average seed stage investment will be 3x higher than it was in 2007. The simple math of investing is that only two prices matter – entry price and exit price. Though the entry prices are seeing a big uptick, exit prices are remaining relatively flat (even given all the hype around unicorns). In fact, the total value of M&A exits in 2013 was less than 2007. Yet the money is flowing in at a very high rate with a 10x increase of funding levels in the last four years. These funds seem to be making a bet that exit valuations are going to dramatically increase over the next few years. At First Round, when asked if we’re in a bubble, their answer was, “We don’t know. We don’t have a crystal ball. But we do have a calculator.”

 

Bee Highway. Oslo, Norway now has a “bee highway,” consisting of bee-friendly routes through the city. Each features flowery, green rest stops along the way so the bees can take a break and fill up on nectar, with a goal to put “pollen stations” every 250 meters (around 800 feet) so the bees can navigate the city without starving. Bees are essential, not just for honey but as the machines behind pollinating many of the fresh foods we eat. Learn more in this Fast Company article.
 

THINGS I LIKE

 
How an American Sunday school teacher joins ISIS. This amazing New York Times article / video tells the story of how a 23 year old woman in Washington gets recruited by ISIS.

 

Country music in Kenya. When I was living in Nairobi my favorite thing to do was to go hear this Kenyan named Sir Elvis sing country music. If I closed my eyes, I thought I was back in Tennessee. Check out his story in this New York Times article.

 

VIDEO OF THE WEEK

 
Jack Dorsey on curiosity, the launch of Twitter, Square and other cool stuff. Check out this talk he gave at Stanford.
 

ABOUT THE WEEKEND BRIEFING

The Weekend Briefing is a selection of this week’s top stories on innovation and society, curated by Kyle Westaway – author of Profit & Purpose and Managing Partner of Westaway Law. I consider it a privilege to be a part of your weekend routine. Thanks.

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