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The founders of Wag abandon fund and ride off into the sunset with bike-share startup
Last year, Wag’s founders, wonder-bros Jonathan and Joshua Viner, went from being fundees to funders, launching their own fund for consumer startups.
If you love something, let it go
Almost exactly one year ago, then-3-year-old dog walking startup, Wag, secured a massive, $300m investment from SoftBank’s infamous Vision Fund, in exchange for 45% of the company and 2 board seats.
Prior to the deal, Josh Viner also agreed to abdicate his position as CEO in favor of more experienced exec, former LifeLock CEO Hilary Schneider.
Josh and Jon said they would stay on at the company in senior roles and it appeared to be a classic case of the SoftBank steamroller — though the brothers have denied SoftBank’s influence on their decision.
The brothers Viner were down, but not out: 5 months later, they announced their plan to leave Wag to start their own $50-200k fund, leveraging their “marketing chops and celebrity connections” to help consumer startups.
Take that FU(nd) money and run
Now, after 7 months in stealth, the Viners are calling it quits on their so-called fund, to focus on its golden child, Wheels.
Josh said that after starting the fund, “Wheels quickly became a massive opportunity, and we’re now entirely focused on this business.”
You guys know that’s not how a fund works, right?
Wheels inexplicably hopes to compete with the likes of Uber, Lyft, Bird, Scoot, and Lime in the “dockless electric mobility” market, by focusing on a “sustainability-first approach” with swappable part replacements.
But how sustainably can Wheels “swap out” bikes after teens throw them in a lake???
|@ Me Anything|
| Lindsey Quinn, Managing Editor at The Hustle
Step 1: Start a “fund.” Step 2: Take the best idea. Step 3: Close fund. Step 4: Profit!
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Enter ‘the reverse supply chain’ — where Amazon returns are sold and reborn
Amazon’s product-sorting and ranking algorithms are the best in the business — after all, the company sells a wider variety of goods than an industrial-sized bag of Otter Pops. But once a product is returned, all organization goes out the window.
Once the items wriggle free of the database, they’re randomly cobbled into mystery boxes full of other unwanted goods — cuz who wants to waste time sorting the rejects?
Per The Atlantic, it turns out there’s a whole market of hustlers looking to capitalize on Amazon’s slop… which is where Liquidation.com comes in.
Going where lots of returns have gone before
Founded in ’99, Liquidity Services (branded as Liquidation.com) is a marketplace that connects sellers to its list of nearly 3.4m registered buyers.
The company calls dealing with returns “the reverse supply chain” — a side of the retail biz that has only grown as online shopping increases (in 2016 an estimated 25-30% of online purchases were returned).
In the past fiscal year, Liquidity Services bought $33m of leftover Amazon inventory (which it then sells for maybe 5% of the supposed retail value) — and then it sold $626m worth of shtuff.
A side-hustle is born
Once people buy Amazon’s mystery boxes from Liquidity Services, they can sort the items and then sell them for larger profit.
Now that liquidation is taking off, some people are making side cash while others are making it a profession: But don’t be a liqui-fool, in the world of resale, there’s always more dirt than gold.
Andela, which pairs African developers with global tech companies, raises $100m
Andela, a company that mentors African software developers and connects them with top-tier tech companies, raised $100m to double in size.
As both an outsourcing company and a professional development program, Andela has staffed more than 200 tech companies and launched tech careers for 1.1k developers.
So, how does Andela work?
Andela wears two hats. For applicants, Andela is a highly selective professional training program; for corporate clients, it’s a top-quality tech staffing agency.
Employees apply to Andela: If they survive the rigorous application process (less than 1% do), developers go through 6 months of immersive training before they’re paired with a partner company.
Clients pay between $50k-$120k per developer, and Andela pays ⅓ of that directly to the employee and keeps the rest to feed back into the business to provide resources that allow their developers to work remotely.
The distributed future
Andela’s ‘distributed’ model is good for local economies (because highly skilled employees stay in-country) and global tech companies (who need trustworthy remote employees).
To date, Andela has raised $180m (with backing from Mark Zuckerberg’s Chan Zuckerberg Initiative and Al Gore’s investment firm).
|»||Contribution by distribution|
Dirt moguls: Why it’s better to own a dirt lot than an old building in a housing boom
According to new research from the Federal Housing Finance Agency reviewed by The Washington Post, the value of land in hot real estate markets rises faster than value of houses in those same markets.
While real estate is a good investment for people who have enough money to buy houses and apartment complexes, it make fortunes for the people who can afford to sit on a plot of sweet, tenantless dirt.
The haves and the have-dirts
Like houses, land is most valuable in developed areas: An acre of the brown stuff is worth 7.5k times as much in Brooklyn Heights as it is in rural Arkansas.
Yet, when real estate market heats up in a particular city, landowners benefit far more than homeowners. The first reason for this is obvious: You can build more houses, but you can’t build more land.
But the second reason is more complex: Since developers need to buy land before they create buildings, landowners can always cash out before homeowners — and they don’t need to remodel their condo to do it.
Research shows that huge spikes in land prices are accurate predictors of subsequent housing busts. So, when housing markets hit the fan, landowners can sell their dirt right away (or hold onto it until prices go back up).
On the flipside, building developers are often stuck with expensive construction or renovation projects, with no way to recoup all the money they spent.
Long story short: If you happen to own a dozen vacant lots in Seattle… You’re doing all right.
|»||Dirt is the word|
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| Lindsey “Got dirt?” Quinn
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