Sunday Reads and Listens - Software Is Eating The World, But Interest Rates Are Eating Software Valuations -

Good morning everyone…

It is nice to be writing from my home office and my desktop Mac.

I am catching up on notes, decks, emails from my weeks on the road.

On the way home from Tel Aviv I listened to two excellent videos/podcasts that readers should enjoy re investing and bubbles and rates.

The first is Howard Marks giving a mastercalss on risk and investing.

The second is ‘bubble historian’ Jeremy Grantham who says this bubble has yet to burst and a great dioscussion on interest rates.

Looking back, I was wearing my ‘grumpy old man ‘ angel investing hat all week in Tel Aviv.

To keep it simple I am trying to explain to the founders and mangers/co-investors that will listen that while software may still be eating the world, higher interest rates are eating valuations.

In Tel Aviv, I was meeting with founders in our portfolio and managers in our emerging manager portfolio sharing my opinions and worries about the persistence of higher rates and too high valuations.

My friend Rami, a co-founder of fast growing Marble Law (fund 3 of Social Leverage) shared this tweet with me after our meeting so I know he understands the investing landscape…

It takes Two to Tango, so for the seed/angel/venture economy to get healthy, both founders, investors and LP’s need to make good decisions based on the world we live in.

From my vantage, founders and VC’s are listening, but not really adhering yet. Most probably can’t because they only know ZIRP and growth/marketing terms like ‘growth hacking’ and ‘blitzscaling’ which at best were useful for a small group of winners and the authors.

Even in high flying Israel, things have cooled. I know this because Rami and Marble are subleasing what I think is a prized office in town directly above Sarona Market.

Rami is a real person and an amazing guy…

When I landed in Tel Aviv I headed straight to Yoni and Mor Assia’s home because Yoni was headed out of town the following day.

Both are incredible entrepreneurs and the parents of 5 kids. I enjoy being in their chaos. They got me Thai food and Israeli chocolate bubka cake which was delicious…

Yoni and I have been talking fintech and markets and trading since 2010 when we invested in Etoro. Today Etoro is a global, highly profitable, well capitalized, multi billion dollar company. It makes these strategy sessions more interesting as most of fintech is in a nasty bear market with deteriorating fundamentals. Yoni’s brother and co-founder Ronen also joined us (he is a full time VC the last few years). Ronen has an even more important role as my go to on Whatsapp all week for street food recos. He knows every spot.

Another favorite person I get to spend time with is Omri Caspi who started Sheva.vc with David Citron. We are LP’s in their fund. Omri was the first Israeli to play in the NBA and also won a title back with the Warriors. Last time I saw Omri about 6 months ago I razzed him about getting soft in the belly, and sure enough this time he was in the best shape of his life. He is now the Israeli national Paddle champion (not that lame Pickleball).

Have a great Sunday.