Hey, I'm Dan! I invest in early-stage startups at Madrona and write the DL, a weekly newsletter about tech in the PNW

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Earnings season for Seattle companies

Redfin and Expedia both had great earnings calls last week with Redfin stock up 20% and Expedia up 10%. These are definitely two companies to track over the next few quarters...

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Amazon is the biggest advertiser on earth

Amazon spent $11B on ads last year. That’s literally enough money to buy an Echo for every single person in America and have $1.5B left over to go acquire Sonos. According to WPP, this represents ~2% of all global ad spend...

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What Dan's Talking About

Dan's weekly summary of interesting articles, great books, cool videos, and internet memes

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January 2020 PNW Venture Deals

Here are the PNW startups that announced new fundraising rounds in the month of November. These 23 companies raised ~$180M last month!

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What's new at Madrona

This year is Madrona’s 25th birthday 🎂, and we are starting the year off with a lot of exciting news! Here’s a quick overview of what’s going on at Madrona and our portfolio companies:

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List of Seattle Venture Capital Firms

Here's a list of venture capital firms and other investors who are based in Seattle or the Pacific Northwest:

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Amazon reaches $1T market cap!

Amazon has officially joined Apple ($1.4T), Microsoft ($1.4T), and Alphabet ($1.0T) in the cuatro commas club! To celebrate, here are a few great quotes from haters including Barron’s 1999 Amazon.bomb article:

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Why VCs love SaaS Businesses

VCs love SaaS businesses because most public SaaS companies need less than $1 of capital to acquire $1 of ARR. Here's how SaaS capital efficiency compares to other types of businesses

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Spokane's Top Startups

Here’s a report highlighting 30 of the most exciting startups in eastern Washington...

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Okta's startup picks

Every year Okta publishes a report on the fastest growing apps used by their customers, and it’s a great crystal ball for startups...

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PSL Studio Deep Dive

Part Two on PNW / Seattle venture firms and what they are investing in. Here we’ll take a closer look at PSL...

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What seed-stage companies is Madrona investing in?

Last week, The Information wrote an article on the top seed investors over the past decade, and Madrona was one of the ten firms on the list... So what does the next generation of Madrona’s startups look like?

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ARK Big Ideas 2020

I really like ARK’s research reports because they do a good job analyzing markets from first principles (even though I sometimes disagree with their conclusions). Here’s a link to their 2020 report...

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🚀 Rocketship stocks

Space travel is super hot. Over the last two months, Virgin Galactic’s stock has jumped from $7 to nearly $20...

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Seattle's top 18 enterprise startups

Here is the latest list of top enterprise startups to watch in Seattle:

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Get rich (selling software) or die tryin' (anything else)

It seems to me there are two dominant startup models in tech today...

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The disruption of disruption

Last week Ben Thompson published an interesting article called “The End of the Beginning” where he lays out his vision for the future of the tech industry...

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How much money does Twitch make?

So we know that the highest paid YouTuber makes $25M+ per year (btw - he’s eight years old), and the biggest Twitch/Mixer streamer makes $1M per month, but how much does Twitch - the company - make?

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Casper's S-1 and the DTC economy

Casper, the company fka as a mattress startup and now a “Sleep Economy” company, released their S-1 (document you file before an IPO) last week...

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December 2019 PNW Venture Deals

Here are the PNW startups that announced new fundraising rounds in the month of December. These 22 companies raised $320M+ last month.

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Read this before starting a startup

One of last week’s top links on Hacker News was a post called I wasted $40k on a fantastic startup idea. It’s about one developer’s hard-earned lessons (nine months of work and $40K) on how to validate a Brilliant Startup Idea.

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Why the PNW startup market is 🔥🔥🔥

To kick off 2020, I wanted to recap some of the best articles on what’s going on in the Seattle and Pacific Northwest tech and startup ecosystems...

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One in five new tech jobs is based in Seattle

Between 2005 and 2017, high tech industries (like software, pharma, aerospace) created 256K jobs in the United States. Seattle accounted for 56K of these jobs, which means 22% (1 in 5) of all new tech jobs were created in Seattle.

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October 2019 PNW Venture Deals

Here are the PNW startups that announced new fundraising rounds in the month of October. These 18 companies raised $480M+ last month!

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Thank you, thank you, thank you!!

🤩 Thank you everyone for reading and supporting the DL! The first DL went out in June to 4 subscribers, and today this is going out to 888 of the PNW’s smartest, nicest, most good-looking, and successful people. 🎉

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Top DL articles of 2019

In case you want to spend your holidays reading about tech stuff (no judgment!), here are some of the top DL articles from the last year.

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Seattle Unicorns

It’s been a great year for Seattle unicorns.

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2010s - The Smartphone Decade

Did you know that the Uber, Instagram, FaceTime, and Netflix apps all launched in 2010? Spotify and WhatsApp also launched in 2009. What an insane couple of years (and decade) for VCs and startups focused on mobile.

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2010s - Consumer vs. Enterprise Startups

Which makes more money - consumer or enterprise startups? Sapphire Ventures put together an interesting report looking at trends over the last decade. Here are the takeaways:

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Cool AI project - How to get free meals in NYC

Definitely a startup idea in here! Great post on how someone built an automated system to conquer Instagram and get free meals.

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Venture Out - a nights and weekends launch pad

People often ask why there aren't more startups in the PNW given all of the local tech talent. Last week, two Microsoft and Amazon alums announced a new program called Venture Out that is aiming to address this opportunity...

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November 2019 PNW Venture Deals

Here are the PNW startups that announced new fundraising rounds in the month of November. These 24 companies raised ~$600M last month.

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AWS re:Invent 2019 Recap

Last week was re:Invent, AWS’s big customer and partner conference. I got a bunch of free socks from enterprise software companies, and AWS announced a ton of new products and services. Key takeaways...

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PNW Cyber Monday Picks 2019

In case you want to buy something because it’s Cyber Monday, but you don’t know what to buy… this week’s DL is celebrating Cyber Monday with a bunch of deals from PNW startups! Here we go!

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How to build a $100B SaaS company

Great article from Jason Lemkin on what it takes to build a $100B SaaS company. Here are the highlights:

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Promo codes for 2048 Blast

Redeem these in the app store for free gold in 2048 Blast! If you like the game, please leave a review or tell a friend about it!

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America’s CEO Factory?

According to CEO recruiters, “like GE in its heyday, Amazon is viewed as a so-called ‘academy company’ where leaders are groomed...”

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Financials of Sea-Tac Businesses

Every business that wants to lease space at Sea-Tac Airport has to respond to a public RFP, and Sea-Tac also publishes the results of their audits online. It’s pretty fun to see the economics of an airport business...

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Why I'm Obsessed with TikTok

If you’re someone who cares about tech trends, you need to get on TikTok. As of this fall, TikTok is officially more popular with teens than Facebook, and it’s growing rapidly (1.5B users, 500M+ added this year).So what is it?

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Value creation and value capture - SR99 case study

Last week the Seattle Times reported that it costs $0.30 to collect $1.00 for the 99 Tunnel toll. Apparently, back when people collected physical money in tollbooths, collection overhead was 20-30%, so 30% is really bad.

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Nike vs. Amazon - Brands vs. Sellers

Lots of coverage on Nike’s break-up with Amazon last week... One thing that jumped out to me here is if you look at Amazon’s flywheel diagram, it highlights “sellers,” not “brands.”

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Go Sounders! ⚽⚽⚽ - ⚽

In case you want to know what it’s like to invest in a championship-winning sports team, check out this Q&A with Terry Myerson (a DL exclusive! 😊)...

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Investing in the Sounders: Q & A with Terry Myerson

Sports teams are 🔥! Every NFL, NBA, and MLB franchise is now worth at least $1B, and there are 52 teams across all sports worth at least $2B, up from one (Manchester United), in 2012. Last week the Sounders announced new owners

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JEDI - Joyfully Evaluating DoD Infrastructure

A couple of weeks ago, Microsoft won the $10B JEDI contract to provide “enterprise level, commercial Infrastructure as a Service and Platform as a Service to support Department of Defense business.” <– (i.e., cloud ☁️)...

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Three types of AI companies

Intelligent applications are one of Madrona’s core investment themes, and this week Soma and I wrote an article on the three types of intelligent applications that VCs want to invest in...

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A tale of two retailers 🛍️

The New York Times had a fascinating pair of stories about family-run retailers this week - one about Nordstrom and one about Forever 21. There are a bunch of great stories and anecdotes in both...

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🎓 2019 Techstars Alexa Accelerator companies

Last week was demo day for the Alexa Accelerator. Techstars runs programs around the country with different groups like the Air Force, Comcast, Western Union, etc, and this one is a partnership with Alexa...

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💯 Seattle tech talent is exceptional

According to CBRE’s (commercial real estate firm) latest report, Seattle has the best tech talent in the country - ahead of San Francisco! Vancouver has also been making big strides...

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Boeing's 737 MAX and what it means for AI

The 737 MAX investigation raises a lot of interesting questions about AI, so here is my two-minute summary of the situation and what it means for the future of automation:

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Disrupt yo self! 💥

It’s really interesting to see corporate strategy play out in this era of technology and innovation because innovators are willing to take gigantic bets and disrupt themselves...

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September 2019 Venture Deals

$500M+ raised by 20+ PNW startups... Here are the PNW startups that announced new fundraising rounds in the month of September. It’s a long list - people are back at work!

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🧠 Brain computer interfaces

Last week at Madrona, we had a guest talk about brain computer interfaces with Rajesh Rao from UW. It’s fascinating to see the latest stuff in this field, so here are links to cool demos, products, and articles:

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🍞 TechLoaf presents... the latest DL survey results!

If you’re not reading TechLoaf, you’re missing out. This is the funniest tech satire out there today, and I’m proud to present TechLoaf’s analysis of The DL’s latest survey:

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What's happening at WeWork?

The WeWork IPO has gotten way too complicated, so here is the best summary of what’s going on that you can read in less than two minutes:

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How to choose your next job

Before reading the rest of this, put yourself into the shoes of a Stanford senior graduating with a CS degree, and pick one of these (real) job offers:

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How much do people at tech companies make?

It shouldn’t be a surprise to readers of the DL that tech companies pay really well, but here’s a better look at exactly how well

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Ask your friends at Amazon what they think

One of the best parts about living in Seattle is...

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“You have to have machine learning in your story or you’re not sexy.”

Last week Forbes released its list of the 50 most promising AI startups in the country, and there were five Seattle companies on the list. Here’s a quick look at each of the companies:

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Gaming in Seattle - Ninja Battles and Three Trends to Watch

In addition to cloud, ecommerce, and machine learning, Seattle is a major hub for gaming. There are more than 400 gaming companies here that generate $28B in annual revenue and create 23K jobs.

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Gen Z Survey from Morgan Stanley 👻

Morgan Stanley does a survey with all of their ~20 year old interns at the end of the summer, and it’s a super interesting view into the world of Gen Z (under age 24). Here are my key takeaways:

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"Please don't come" -Costco 😘

A few weeks ago, Costco opened its first store in China, and it was so popular they had to close the store and send a message to customers that said “Please don’t come.”

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Seattle's latest unicorn - 3 years to $3.5B!

Seattle startups are known for being understated, but Assurance must be one of the stealthiest startups ever. Last week, they were acquired by Prudential for $3.5B, and I don’t think TechCrunch even wrote about the acquisition.

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Survey says...

Last week, Sarah and I had a bet on which option would be most popular. I said B because people want variety, but on an upward trajectory. She said D because startup people like hockey sticks. Turns out we were both right!

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August 2019 Venture Deals

Here’s a roundup of PNW startups that announced new fundraising rounds in the month of August.

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Equifax's other database

Last week, someone pointed me to Work Number, which is an amazing business I had never heard about before. Work Number is a database for employment and payroll data, and customers primarily use it to verify someone’s employment.

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Seattle seed deal trends

After seeing this great visualization from Tom Tunguz, I worked with the PitchBook team to replicate the analysis for seed trends in the Pacific Northwest. Here are some highlights and areas where I’m excited about new investments

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Great use of AI for marketing 👏

I love this marketing campaign that Ogilvy worked on for Deutsche Bahn (German Rail) - such a cool use of computer vision, Facebook data, and targeted ads. Here’s a summary of what they did:

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PNW highlights from the Inc. 5000 ⭐

A couple weeks ago, Inc. released its list of the 5,000 fastest growing companies in the US, so I wanted to highlight a few of the best PNW founding stories.

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Startup success outside of Silicon Valley

Founder Collective put together an interesting analysis on the last ten years of software M&A and IPOs by geography (Jan 2009 - Aug 2019). Seattle got a nice ☕ emoji, and $50B of exit value over the last decade.

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July 2019 Venture Deals

Here’s a roundup of PNW startups that announced new fundraising rounds in the month of July. Looks like VCs weren’t on vacation just quite yet!

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Seattle's biotech startups and the Fred Hutch 👩‍🔬

Putting together the Pacific Northwest unicorn chart, I was surprised to learn that ~10% of the PNW unicorns over the last two decades have been biotech companies – Juno, Adaptive Biotechnologies, and Seattle Genetics

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How much money do VCs make? 💸

Last week, Version One, an early-stage VC based in Vancouver and SF, published a great blog post on the returns to-date for their first fund, a $15M fund raised in 2012.

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Softbank 2 -- Looking for the next 105 Robinhoods

Last week, Softbank announced that they raised $108B in their second Vision Fund with investors like Apple, Goldman Sachs, and Kazakhstan’s sovereign wealth fund.

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Microsoft on 🔥🔥🔥

After Microsoft’s Q4 earnings call last week, the WSJ wrote, “Microsoft’s comeback is no longer tech’s best-kept secret.” The company made over $125B in revenue and $10.6B in profit last year, beating analysts’ forecasts

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Seattle Tech Trends - What's Happening in Real Estate?

There is a lot of interest in real estate in Seattle, and over the last decade, Seattle has become a major center of real estate innovation and investment. Here are some of the trends we are seeing

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1% Ideas

Businesses for the 1% are great. You don’t need to sell a lot of stuff to generate a lot of revenue, and you get to sell super cool stuff - like a four day astronaut training course that ends with a trip into space.

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Starting a Startup from Microsoft

Last week at Madrona, we hosted a lunch and learn with our interns and Brian Saab, the CEO of Unearth, a modern mapping platform. He talked about his journey from Microsoft to startup CEO, and it was a really insightful session

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Zillow, how much is this photo worth?

It’s hard to live in Seattle without seeing an article on home prices or artificial intelligence every day, but this article about Zillow is actually a cool demonstration of how much AI is changing the game

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June 2019 Venture Deals

Here’s a roundup of PNW startups that announced new fundraising rounds in the month of June.

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How to Sell a Company to Uber

Last week there were two acquisitions of autonomous vehicle startups. Apple bought Drive.ai, and Uber bought MightyAI (a Madrona portfolio company – woohoo!)

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Advice from Jeff Bezos

A couple years ago, we had a 20th anniversary celebration for Madrona, and one of the events was a fireside chat between Jeff Bezos and Tom Alberg, one of Madrona’s founders and the first outside investor in Amazon.

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Forward this to your friends at Tableau

Tableau’s largest acquisition ever, and pretty amazing for the teams that have built Tableau into a $15B+ company (to put that in perspective, Nordstrom’s current enterprise value is ~$10B)

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Pacific Northwest H1 2019 Venture Deals

I thought it would be good to start issue #1 out with some commentary on the overall startup market in Washington, Oregon, and British Columbia.

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