Is this immigration game really worth the candle? I think not. And I say this as someone who is an immigration reformer, not a restrictionist.
The free movement of trade, capital, and labor is strongly pro-growth. History shows that legal immigration is good for America, economic growth, entrepreneurship, job creation, and hard-working families. America must remain a city on a hill, attracting the best and brightest from around the world - a beacon of freedom.
The trouble is, Obama’s executive actions not only usurp powers that are not his, they don’t really solve key immigration…

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Check out this brilliant video from the TGIF restaurant in Manchester where they hung mistletoe from a drone to get their customers kissing. The ‘Kisscam’ at 0.55 is my favourite moment. That’s quite put me in the mood for Christmas, and it’s not even December yet )



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It was nice to see that the FOMC considered US treasury bond trading on October 15 at its October FOMC meeting. More than a month later, there still isn’t much by way of consensus on what caused the “crash” nor how to interpret the events of that day. Even the “crash” itself was odd in that what occurred was not a precipitous drop in price, but the exact opposite. In terms of yields on treasury bonds, it was there where the usual convention about such things related.
To say it was an extraordinary event is to be severely understated, though attention is limited outside the immediate rungs…

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It’s pretty well recognised now that a strong company culture helps bring success to a business, but what’s new is that a company’s culture is starting to matter to consumers. Moreover, whilst shareholders may judge a company’s culture on how much it contributes to good execution, customers judge it on ethical grounds.

Hence, for the second year running Amazon Anonymous are running a boycott Amazon campaign this Christmas which they claim has so far diverted £1.3m of spend (many of my north London neighbours will be pleased…) and a range of people are urging us to boycott Uber. I think we will see more and more of this sort of thing. People are increasingly concerned that the companies they shop with match their values. This plays out positively for companies with a strong ethical profile and negatively for those with unpopular practices.

Interestingly, some of the elements of company culture which have historically been great for shareholder value are the ones that are now undermining brands. Taking the examples above, Amazon’s famously frugal culture has landed them in trouble for low wages and Uber’s all out aggression has led them to many actions that most people view as unacceptable, most recently threatening journalists with smear campaigns.

I think we are heading towards a better world where unsavoury behaviour is tolerated less, but it is also a more complicated world for managers.



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While California’s official November 4th election results won’t be finalized until the end of the month, we can still gauge the success of certain economic competitiveness messages. With national Republicans failing to pick up any California Congressional seats, the national messaging largely proved ineffective, even with a seemingly Republican-friendly electorate. Instead, it would appear that despite the lackluster gubernatorial election, California issues reined. But that doesn’t mean all of them were successful.
The Messages That Succeeded
Pension Reform: San Jose and San Diego are…

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Sherry Coutu’s much anticipated Scale Up Report has now been released with the clear argument that job creation comes from fast growing companies, or ‘scale-ups’ rather than all startups, and hence that’s where we should focus our policies. The report goes on to make a set of practical recommendations for government to help the UK’s scale-ups and hence improve job creation and GVA. The Scale Up Report’s recommendations are designed to produce better data so scale-ups and the effectiveness of scale-up policies can be tracked, to reallocate resources from start-ups generally to scale-ups specifically, and to make individuals, including a Minister, responsible for increasing the number of scale-ups we have in the UK.

I’m interested in the impact that a venture capital fund like Forward Partners can have on job creation and GVA. On page 106 of the report there’s a table showing the number of scale-ups by region. This year there are 8,923 scale-ups in the UK, with 2,264 of those based in London. Thames Valley Berkshire is the next biggest region with 562 scale-ups. (Scale-ups are defined as companies with 20% growth p.a. in turnover or employees for three years and with more than 10 employees at the start of the period.

Like many venture funds Forward Partners has a target portfolio of around 30 companies which we will invest in over a three year period. If all of our partner companies were to become scale-ups that would be 0.3% of the UK total and 1.3% of the London total. Research cited in the report predicts that scale-ups will create 238,000 new jobs over three years and contribute £38bn to GVA. If we have invested in 0.3% of the scale-ups then we will have had a hand in the creation of 714 jobs and £114m of GVA (which curiously enough isn’t far away from the amount we project our share of our partner companies will be worth).

That’s a nice target to aim at and a result that would make us proud.



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In the four years since the passage of Dodd-Frank, the financial regulators have written a lot of new rules. Throughout the implementation period, at least one of the chambers of Congress has been under the control of the party that passed Dodd-Frank. Agencies therefore have been spared some painful scrutiny of their Dodd-Frank implementation programs. This month’s election changed that, and agencies are likely to face a lot more uncomfortable oversight in the upcoming Congress. But the new Congress, not as wedded to Dodd-Frank as its predecessors, could also make life more bearable for…

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A new Congress is arriving, and it is time to reform FSOC, the “Financial Stability Oversight Council.” FSOC is part of the efflorescence of regulatory bureaucracy created by the notorious Dodd-Frank Act of 2010– a typical political over-reaction, as happens in every cycle.
FSOC is a committee of regulators assigned the high-sounding job of identifying and preventing the threat of “systemic risk.” This is probably not possible. The utter failure of central banks, notably including the Federal Reserve, regulators and economists in general to diagnose the great 21st century bubbles in the…

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Snapchat just launched their Snapcash service in the US which you to send money to friends by sending them a message (details here in Techcrunch). Many entrepreneurs have gone after the P2P payments market, but no-one has so far succeeded. I think Snapcash might be different for the following reasons:

  • It piggy-backs on a large existing network
  • It is simple to use – just start a message with a dollar sign
  • It’s free

The service is based on Square and requires the sender and receiver to enter their debit card info, which makes it a small step from here to being able to pay retailers as well as consumers. As well as increasing engagement with their users the benefit it Snapchat is that it will have real names for participating users, useful for ad targeting.

I wonder if Facebook will do something similar to Snapcash with Whatsapp.



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Now that the midterm elections are over, the Department of Labor is getting ready to release new proposed rules on overtime pay. These rules will fulfill President Obama’s promise to raise the salary level at which employers are required to pay overtime. In March, at the White House, the President said, “Overtime is a pretty simple idea: If you have to work more, you should get paid more.”
But this promise contradicts other promises the president has made, most specifically towards working women. The president wants working women to have flexible hours and to be able to telecommute, job…

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President Obama has claimed that income inequality is the “defining issue of our time.”
There is no doubt that income inequality is growing. A recent CBO report that traced market income (before taxes or government transfer payments) shows that 80 percent of U.S. households had a smaller share of market income in 2007 (before the Great Recession) than in 1979. Even the top 20 percent, taken as a whole, increased its share of market income by less than half a percentage point. The winners were the top 1 percent of earners. Their share of market income leaped from 10.5 percent in 1979 to 21.3…

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It’s perhaps apocryphal, but in his classic 1982 book The Economy In Mind, the late Warren Brookes referenced the arrival of a famous Keynesian at New York’s JFK airport in 1979. Upon reaching customs, the customs’ official checking passports said to the economist “I don’t know whether I should let you back, Professor, considering what you economists have done to this country.”Brookes’ story bears relevance in light of the aggressive actions taken by economists at the Fed, and at central banks around the world. To witness their machinations is to marvel at the damage being done, and to…

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median-days-seed-a-tech-2014

The ever excellent CBInsights just released new data on the time between rounds. As you can see from the chart above year to date in 2014 the median time between seed and Series A has been 349 days and that’s been reasonably consistent over the last couple of years. If the median time is just under a year then in the spirit of planning for the worst and hoping for the best this data suggests that reckoning on making your seed round last 12-18 months is the way to go.

Thinking about our portfolio and other companies I have seen recently in the UK I would estimate that over here the median time from Seed to Series A is slightly longer than this, maybe just over a year. That would make sense given that the volume of capital in the market is lower and the competition between investors is less intense. (The good news is that the a number of new funds have come to market recently, including Google Ventures and Mosaic Ventures.)

For UK companies then, I would advise reckoning on 12 months as a minimum. Some companies do better than that, but that takes luck and it isn’t wise to plan on being lucky.

All that said, within reason more runway is better and if you can get extra cash at an acceptable dilution it’s usually worth doing. Important caveat: if you do raise a large seed round don’t ramp the burn too much before you’ve found a repeatable business model.

On a side note, in a bubble times between rounds usually drops, but we’re not seeing that in the chart above, or in times between later rounds.



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Trying to invest like Warren Buffett has such a long history that numerous columns have been written about how to construct portfolios of companies that the writer posits Warren Buffett would like. Other investors or money managers simply build portfolios of companies in which his Berkshire Hathaway has substantial holdings. Multiple books have been written on how to invest like Buffett. Still, it is always worth reminding, particularly as the subject of tax reform bubbles up in Washington, D.C. once again, that while imitating Warren Buffett can come with large rewards, listening to him is a…

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The greatest economic challenge of our time is how to restore economic growth. Over the past dozen years, average real growth has slowed to 1.8 percent annually, under both Republican and Democratic presidents and congresses. It’s a bipartisan problem.
And it’s a new one. For the past 50 years or so, the American economy grew at just less than 3.5 percent per year. But we’re now experiencing one of the longest slow-growth periods in the past 100 years. Excluding the Great Depression, I bet it is the longest slow-growth period in a century.
There are any number of fiscal and monetary…

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