Newsletter #3: May 24, 2022

the executive nap

A 10 minute nap can reset the brain and make the next two hours twice as productive. To quote the mug on my desk, “I wasn’t sleeping, I was dreaming of success”.

Three months feels like 12 years and 12 hours all at once. Here’s the latest Glen Lake stats from the last three months:

This month we prepare to launch two new concepts to PoC/MVP phase. What does this mean? We will build no-code prototypes of two products and take them to potential customers to get their feedback. With that feedback, we will iterate and iterate until there is something that people want.

Additionally, we continue to consult to help clients commercialize their products. This helps to cash flow Glen Lake and minimize the amount of venture investment needed to make the company run. This is important because…

Straight cash, homie

We’ve entered an economic contraction. Venture-backed startups feel this because VC is one of the first asset classes to dry up in a high-risk economy. Investors will prefer lower risk investments like bonds and cash. Great time to start a company, eh?

There are two types of startups. A default-dead startup’s expenses exceed its income. The company operates because of equity investment capital. Without this capital, the company would not be a going concern. In a high-risk environment, this may not be good. A default-alive company is cash flow positive. The company may still take on investment capital to scale, but otherwise can cover their expenses without investment capital. This is good. In a market contraction, a default-alive company is in better shape because their survival does not depend on investors.

Paul Graham introduced the concept in his letter here. You can tell its good because the website’s 90’s UI has survived the last 7 years.

Glen Lake intends to be a default-alive company to start. We support our operations with consulting services because this provides us the cash to fund the new company creation efforts. Venture capital will be solicited to scale great ideas when the time comes. Will this work? Who knows! Guess that’s why you should keep tabs on the newsletter.

A few books we like:

Burn Rate by Andy Dunn

Andy Dunn founded Bonobos. He also manages bipolar disorder. Startup founders are 3-4x more likely to be diagnosed with mental health conditions like bipolar disorder. Burn Rate is a shockingly honest story of how Dunn navigated startup growth while he contended with his (at the time) untreated disorder.

Borrowing Brilliance by David Kord Murray

Did you know that the patent system was created not to protect IP, but to allow others to build upon it? Borrowing Brilliance anchors on the fallacy of original thought. Ideas come from patterns observed elsewhere, so you might as well be intentional about how to seek them. This book teaches you how.

An industry we like: reverse logistics

Reverse logistics answers the question: when I return the chocolate fondue fountain I bought after a few too many Chardonnays, where does it go?

Customers return 16.6% of all goods that they purchase online. As eCommerce grows exponentially, so too does the problem of how to return the goods that we buy. 59% of retailers offer free returns to their customers. There is a massive opportunity to solve this problem in a cost-effective way for these companies.

There are a few solutions in this $624B (!!) market. Amazon has grown its brick & mortar presence in part to combat these challenges. You can now return Amazon products to Kohl’s stores—because I know you all shop at Kohl’s. Also, startups like Happy Returns (acquired by PayPal in April 2019) connect eCommerce to brick & mortar to streamline the return process.

help us Build glen Lake Pioneering

To build a business takes a village. A couple of asks for this group:

  • We seek MBAs or other interns to do due diligence on industry opportunities that we have identified. Is this you or someone you know? Reach out!

  • Do you know anyone with IoT hardware experience? RF, RFID, sensors, etc. Would love to talk to them.

  • Do you have any friends at consumer product eCommerce companies? Would love to talk to them.

  • Do you know any concierge physicians? We’d like to talk to them!

Will the Pittsburgh Pirates go 0-for the rest of the way?