If the majority of your understanding of how tariffs work is from Twitter, CNN, or Fox News, I encourage you to go read Trump’s China Tariffs Hit America’s Poor and Working Class the Hardest. And, if you think China is paying the U.S. directly for the tariffs, well, no …
We have a lot of hardware companies in our portfolio so I’ve been living in the world of “what to do about tariffs” for several quarters. My fantasy at the beginning was “ignore and hope they go away.” This quickly evolved through “are there any ways around this” to land at “deal with the reality of increased cost, research, and compliance.”
It also became apparent, almost right away, that startups had a huge disadvantage over larger companies that had significant U.S. lobbying activities. We explored a few paths to engaging with the U.S. government around this and basically were told some version of “go away – you are too small and unimportant.”
Once I accepted the reality that the startups were going to have to pay the tariffs directly, that they had little control on what the tariffs would be, how and when they would change, and whether or not they’d get exemptions, I started operating under the assumption that 100% of the cost associated with the tariff would fall on the startup.
So, I started observing what other companies, especially large ones, were doing beyond the lobbying efforts of BigCo that resulted in exemptions. Would they absorb the tariff as an increase in COGS? Would they increase prices? Would they pass on the tariff to the customer?
A little more research showed what is pretty obvious in hindsight. Many BigCos are simply treating the tariff like a tax and passing it on, either directly or indirectly, to the consumer. This is similar to what is happening with state taxes, as states come up with lots of new taxes for out of state vendors, both physical and digital.
This shows up a few ways. While some companies are increasing the cost of their product to include the tariff (or even a markup on the tariff), many companies are trying to hold their price the same while passing the tariff on through other approaches.
Some companies are adding a line to their invoice called “Tariffs” and charging that to customers (I’m seeing this mostly in B2B situations). This looks like:
Product Price: $X
Total: X + Y+ Z + T
Others are including Tariffs in the Shipping line.
Product Price: $X
Shipping and Tariffs: $Y + $Z
Total: X + Y + Z + T
But the one I’m seeing the most is simply including Tariffs in the “Taxes” line, where Tariffs are considered a tax.
Product Price: $X
Taxes: $T + $Z
Total: X + Y+ Z + T
While some BigCos appear to be eating the cost of the tariff, this seems to be the exception. Startups should pay attention, and act accordingly.
If you are a hardware startup and have either seen, or figured out, a different approach, I’d love to hear about it.
The modern computer science education movement, commonly referred to as Computer Science for All or #CSforALL, has been gaining momentum nationwide since 2004 and is poised to be the most significant upgrade to the US education system in history.
History is recorded and codified through the journalism, social media, and public policy, and tends to emphasize the voices of those already in the public eye. Moreover, we know that media frequently amplifies the loudest voice in the room, and often misses the contributions of those without social capital and power, including women and minorities. Recent films like Hidden Figures and The Computers show this phenomenon by documenting the lost history of women’s contributions to engineering and technology fields.
Unfortunately, reporting on the Computer Science for All movement is already showing evidence of the erasure and dismissal of the contributions of educators, and in particular women and minorities.
On March 3, 2019, 60 Minutes ran a segment on increasing girls’ participation in computer science that excluded the contributions of all of the women-led organizations working to increase girls’ involvement in tech. The segment credited Code.org with solving the problem “once and for all,” sparking nationwide outrage and pushback from community stakeholders including Girls Who Code, littleBits, AnitaB.org, NCWIT, and CSforALL.
Even more damaging, the 60 Minutes piece incorrectly claimed that the number of women majoring in computer science has declined. The number of women receiving undergraduate degrees in computer science has quadrupled since 2009 thanks to efforts of organizations like the National Center for Women & Information Technology, CSTA, and AnitaB.org, as well as investments by the National Science Foundation, Microsoft, Google, Apple, and many others over the past decade.
I was excited to watch the 60 Minutes piece and wrote a quick blog post titled littleBits Is Helping To Close The Gender Gap in Technology with a teaser about it. I then watched the whole episode and was incredibly upset. I fumed for a while and then emotionally supported several women, including Ayah Bdeir, littleBits CEO, who wrote An Insider’s Look at Why Women End Up on the Cutting Room Floor.
I wrote a draft of a blog post but realized that it wasn’t additive to the discussion. I was mad at 60 Minutes, felt incredibly frustrated, and was sad for all the women who were once again marginalized by the way things were portrayed.
I’ve been living in this problem since 2004 when I joined the board of a nascent organization called the National Center for Women & Information Technology (NCWIT). I’ve learned an incredible amount about gender issues in technology – and in general – from working alongside Lucy Sanders and her wonderful organization since then. I’ve tried to be the living embodiment of a male advocate (now commonly referred to as a male ally) and, while I’ve made plenty of mistakes over the years, have been on a learning journey that has made me a much better human.
When Ruthe Farmer, the Chief Evangelist for CSforALL (and formerly of NCWIT) reached out to me about helping with a new project called CSbyALL, I immediately said yes. Amy and I have been supporters of CSforAll for several years and count a number of the board members as friends, especially Fred and Joanne Wilson who helped get CSforAll up and running.
Amy and I, along with Fred and Joanne, are proud to be the first contributors to this new project to document the actual history of the modern computer science education movement. CSbyALL will be a crowd-sourced interactive timeline and data visualization tool that will surface and illuminate the collective stories, artifacts, and events from the distributed CS education community. It will recognize the contributions of not only national leaders and policymakers, but also local advocates like teachers and school administrators, out-of-school time educators, local organizations, and researchers.
If you are interested in supporting this effort or getting involved in any way, drop me an email.
I had surgery recently and a few friends, including Chris Moody and Sarah Ahn, gave me some books as gifts. They knew I’d be spending a lot of time on the couch either napping or reading, so my pile of infinite books to read became more abundant with a few good ones including The Moment of Lift: How Empowering Women Changes the World by Melinda Gates.
While I’ve met Melinda’s husband Bill a few times, but I’ve never spent any time with Melinda. I know plenty of people who know her or work for her and have overlapped with a few organizations that we both support. However, after reading The Moment of Lift, I feel like I now know her. And, she is awesome.
The book is a combination of a memoir, a manifesto, a case study, and a roadmap. While it uses the backdrop of empowering women as the framework, it genuinely addresses how empowering women can change the world.
In the current entrepreneurial climate of “changing the world” and “making a dent in the universe”, this is the first book that I’ve read in a while that really hit home on these issues. I’ve felt discouraged recently by the tenor of the entrepreneurial discussion, where phrases like “changing the world” have become cliches and are really an entrepreneurial proxy for “making a lot of money.” While I don’t object to that, I get tired of the optimistic language as a shield, rationalization, or misdirection for the real underlying motivation.
Melinda turns this on its head in The Moment of Lift. The examples she gives are real examples of changing the world through foundational activities for women, mostly led by women, and supported by the Bill and Melinda Gates Foundation. She devotes a chapter to each of the following topics:
- Maternal and Newborn Health
- Family Planning
- Girls in Schools
- Unpaid Work
- Child Marriage
- Women in Agriculture
- Women in the Workplace
Buried in the middle of the book is an intensely personal chapter about Melinda’s own journey. Her level of self-awareness, humility, and discovery reinforced her awesomeness, and created my own moment of lift while reading the book.
Melinda, both personally, and through her work with the Bill and Melinda Gates Foundation inspire me. It was a perfect book to read while healing. Thanks Chris and Sarah for the gift.
Yesterday, I started my day by finishing A People’s History of American Empire: The American Empire Project, A Graphic Adaptation and ended my day by finishing Everything Is F*cked: A Book About Hope.
In between Amy took me to see John Wick: Chapter 3 – Parabellum (or maybe I took her to see it.)
All three experiences were satisfactory.
Mark Manson is a phenomenal writer. While the book is about hope, it’s not in the way you might think. He mixes philosophy, literature, opinion, self-help, inappropriate jokes, and thought experiments. His footnotes are in the spirit of David Foster Wallace. He has mastered when to include the word “fuck” in a sentence, although his publisher is apparently afraid to use it in unmodified in the book title.
The first half of the book is a setup for the really good stuff in the second half. He defines what he calls “The Uncomfortable Truth”, navigates the reader through an excellent explanation of the Thinking Brain vs. the Feeling Brain, and does a great job summarizing this with his theoretical protagonist “Emo Newton” in the chapter titled “Newton’s Laws of Emotion.” He ends the setup with “Hope is Fucked” which lands with a nice, violent explosion.
Against the backdrop of our current existence, Manson makes Einstein, Kant, and Nietzsche accessible. I particularly loved his section on Nietzsche, since I’m in the midst of writing a book about Nietzsche and entrepreneurship. AI plays a part in Manson’s future view, and he does a good job of summarizing it in the chapter “The Final Religion.”
After spending the day consuming these three inputs, I went to bed feeling that all was ok with the world. It is as it should be, has always been, and will always be. “All this has happened before, and all this will happen again.”
Game of Thrones ends tonight. I think Daenerys melted the Iron Throne (physically and metaphorically) and no one sits on it. But we will see soon enough.
If you are looking for a great book to read this weekend, I recommend Ian McEwan’s Machines Like Me. I read it last weekend and am still thinking about it.
McEwan is a magnificent writer. When the hardcover ended up on top of my infinite pile of books to read, Amy said, “Wow, you’ll love Ian McEwan’s writing.” Whenever Amy says something like that, I know I’m in for a treat.
The setting is London in 1982. But it’s a parallel universe. Alan Turing chooses jail over chemical castration, lives, and has created massive innovations that are 40 years ahead of their time. Lennon and JFK didn’t die. Jimmy Carter wins a second term. Margaret Thatcher gets booted after botching the Falklands War.
That’s the backdrop for the introduction of our protagonists Charlie and Miranda. Charlie uses his inheritance to buy an Adam, one of 25 first production models of artificial humans (13 Eves, 12 Adams are available – the Eves sell out immediately so Charlie ends up with an Adam.)
I love the narrative feature of a parallel universe. Amy and I started watching Season 2 of The OA last night which aggressively jumps to an alternative universe. Some of today’s best near term sci-fi writers are using this as a basis for their writing, although they are often less explicit about how they are twisting current reality to the alternative universe.
McEwan isn’t subtle about the twists, which makes the book awesome. You quickly feel that this 1982 is the real 1982 and things take off from there. Every time McEwan drops another new reality fragment, more pieces fall nicely into place.
The result is a very provocative journey through the introduction of an artificial human into the evolving relationship of two existing real humans.
If you are a reader, especially one who likes (a) sci-fi and (b) literary fiction, you’ve got a fun weekend ahead of you if you grab Machines Like Me.
I’ve been working on the Startup Visa since I first wrote about it 2009 in my post The Founders Visa Movement. After a decade, it’s clear that our federal government has broadly failed us on this front.
In 2015, I announced the Global EIR initiative to try something different. Today, I’m happy to welcome the University of Michigan to the Global EIR network. Applications are now open to become a Global Entrepreneur in Residence at the University of Michigan’s Economic Growth Institution (EGI). Interested applicants can learn more about the program, fill out an application form, and reach out to Millie Chu at Global Detroit.
For founders, this announcement means access to a startup visa, with a long runway, and a path to a green card. Global EIR founders will use their experience as founders to support EGI’s mission of helping other Michigan-based companies develop and execute growth strategies while simultaneously building their startups without worrying about their visa status.
From a broader perspective, the Global EIR program attracts international founders to Michigan. The goal of the Michigan coalition, led by Global Detroit and joined by the William Davidson Foundation, EGI, and Global EIR, is to contribute to the Detroit renaissance and demonstrate how startups are a critical part of economic growth in the 21st century. Thank you in particular to the William Davidson Foundation for their generous support to launch Global EIR in Michigan.
If you’re interested in learning more, I encourage you to look at the detailed information on Global Detroit’s site and apply. They are looking for high-growth international founders primarily in the STEM sector who have a need for an H1B visa and would like to establish their business in southeastern Michigan. Once approved by Global Detroit and EGI, the founder is offered a stipend for working part-time (10-20 hours a week) at the university, along with receiving entrepreneurial guidance and resources to help grow their business.
As of today, Global EIR has helped over 80 founders solve their visa issues. Their companies have raised $450 million and employ nearly 900 people. I’m excited by the progress being made despite frustrating inaction from Washington DC after a decade of conversation about creating a startup visa. Local action by leaders like Global Detroit, EGI, and the William Davidson Foundation is where solutions arise.
Amy and I are proud to be supporting the Global EIR program and the Global EIR Coalition. If you are interested in getting involved and bringing the Global EIR to your state, send me an email and I’ll connect you with the right person.
In July 2015, I wrote about New Story asking readers to crowdfund one $6k house for a family in Haiti. At the time, Brett was only a few months into building New Story and had built less than twenty total homes. They were young and inexperienced but had a strong conviction to do things differently as a nonprofit which appealed to me.
In the past four years, New Story has funded over 2,200 homes, building 17 communities for over 11,000 people across Mexico, Haiti, El Salvador, and Bolivia. They started out by chasing one crazy idea, and have grown nearly 100x since my original post.
They have now come up with a unique model for scaling their impact. There are over a billion people living without safe shelter. The need for safe housing is as staggering as the lack of solutions to meet the need — one traditional home at a time will never scale to the size of the problem. To even begin imagining a solution, New Story had to change their strategy.
In the past two years, they have shifted their primary focus from funding and building their own communities to pioneering solutions for the entire global social housing sector to use. The strategy is to create innovative solutions, prove their value in New Story’s work, and then share everything with others in the social housing sector.
In 2018, New Story partnered with ICON and developed the first 3D printer of homes designed to serve the families who need shelter most. This is a breakthrough technology that will cut costs, increase speed, and improve home design quality. New Story is on track to begin creating the world’s first 3D printed community of 50+ homes this summer in Latin America.
In addition to 3D printing communities, New Story created a SaaS team to help other organizations working to end global homelessness become more transparent and efficient. They’ll be sharing the tools they’ve created, including everything around 3D printing, while continuing to develop new breakthroughs.
The magic for creating this innovation-focused model has been New Stories private group of donors, the Builders. This group of about fifty families partners with New Story to fund their operating expenses and give them the license to take calculated risks through new R&D projects. In addition to me and Amy, my partner Seth Levine and his wife Greeley Sachs are members of the Builders program.
In Summer 2019, New Story is offering vision trips to see the world’s first 3D printed community. For families interested in learning more about the Builders program, email Brett Hagler.
From June 5 to June 8, Techstars Startup Week West Slope will be happening on the western slope in Colorado, with the main event in Grand Junction.
I’m doing a Keynote at on Thursday, June 6 from 11:30am – 1:00pm at Colorado Mesa University. I’ll be talking about building startup communities outside Colorado’s front range in a fireside chat / AMA format.
Startup communities in Colorado that are outside the front range (Boulder, Denver, Colorado Springs, and Fort Collins) have become something that my partner Seth Levine and I have been very involved in the past few years. Seth’s providing a lot of on the ground leadership, through his work with Startup Colorado and the Greater Colorado Venture Fund. I try to show up or help remotely whenever I can and Amy and I have been writing plenty of checks from our Anchor Point Foundation to support various initiatives.
We have family in Hotchkiss, a house in Aspen, and have spent a lot of time in Summit County over the past decade when we had a house in Keystone. There are magical things going on all over Colorado, especially on the western slope. I have a strong belief that startup communities should exist everywhere and can have a meaningful impact on cities outside the large urban concentrations that we have in many parts of the U.S.
What’s happening in Colorado’s Western Slope is powerful and an example that can be used through the U.S. and the world. If you are interested, come join us at Techstars Startup Week West Slope to learn more.
At the time there were 108 projects that fit the profile. Our hope was that our match would fund these projects, encourage more teachers to put their projects up on DonorsChoose.org, and get more new donors involved.
We ended up funding 394 projects, helping 40,404 students, 246 schools, and 380 teachers in Colorado.
At the time, we didn’t announce the size of our matching gift, but it was $100,000. So, through Donorschoose.org we’ve helped fund $200,000 of direct purchases for classrooms in Colorado.
Thank you to everyone who supported these teachers. We love supporting Donorschoose.org because the projects are initiated by teachers who know what they need in their classroom to best serve their students’ educational needs.
David Cohen and I are doing a podcast together called Give First. Readers of this blog likely know that this is the mantra of Techstars and the title of an upcoming book of mine that will be published in 2020.
While I’ve been interviewed for many podcasts, I’ve never hosted one before. David and I have been massive fans of Harry Stebbing’s 20 Minute VC so we’ve modeled Give First after it. Harry really hit his stride after about 100 episodes so my guess is it’ll take us a while to be in the same zone as he is. It’s good to have something to shoot for!
The first episode is an intro with an overview. We’ve got a steady stream of episodes coming that are already recorded, so subscribe to Give First and give us feedback.