Swipe Right for Entrepreneurs

Data from an online dating site suggests that entrepreneurship is increasingly sexy (at least for some).

Good morning!

Here are today’s highlights:

• Banks have lots of cash but are finding few borrowers.

• Partnering with Shopify, TikTok adds in-app shopping.

• Do you know your company’s financials? A simple test.

THE ENTREPRENEURIAL LIFE

On online dating sites, is entrepreneurship sexy? Maybe. “According to data from dating website OkCupid, more people have been proudly owning the title ‘entrepreneur’ while looking for love online this past year, says Melissa Hobley, the company's global chief marketing officer. And for some, it's a clear advantage. From July 2020 to July 2021, use of the terms ‘entrepreneur’ and ‘self-employed’ on U.S. OkCupid profiles increased by 10 percent. And users who identify themselves as entrepreneurs in their profiles have a better chance of getting a match's phone number, according to the company.”

• “Specifically, the company compared the contact exchange rates of profiles that mentioned ‘entrepreneur’ or ‘self-employed’ with the rates of profiles that didn't. Sure enough, the entrepreneurs were getting more numbers.”

• “But there may be a catch: If you're a woman, being open about your entrepreneurial career might give you a better chance of moving to the next level with a match, but if you're a man, it might actually reduce your likelihood of making an initial connection.” READ MORE

SELLING THE BUSINESS

An entrepreneur explains why he sold his startup, Zonehaven, to a public company instead of raising venture capital: “The San Francisco-based company founded in 2019 makes software that helps authorities plan and execute evacuations. The company has partnerships with fire departments in more than a dozen counties in California, including most of the Bay Area. In June, the 25-person company sold to emergency-alert company Genasys for $24.2 million, according to the publicly traded company's SEC filings. Here, Zonehaven co-founder and CEO Charlie Crocker discusses the sale.”

• “I went down to San Diego a bunch and would work from their offices down there. I wanted a feel for the offices. I wanted a feel for the people. I wanted to feel their culture.”

• “‘Some will say we sold too early: Why don't you just take VC money and scale? If you got this far in two years, imagine where you'll be in two more.’”

• “For us, the ability to scale nationwide and internationally went up 10X because Genasys already has people in all these areas.’” 

• “‘In a sense, this company is still my baby. This wasn't a drive-by for me. I'll probably stay there as long as they're willing to keep me here.’” READ MORE

OPPORTUNITIES

Co-working spaces are benefitting from the uncertainty about returning to the office: “Shared office space firms like WeWork and Industrious are enjoying a rise in sales this summer as U.S. businesses grappling with the seismic changes in the workspace world sparked by the pandemic seek flexible and short-term solutions. Hundreds of companies particularly in the technology sector are taking spaces from these firms, ranging from a handful of hot desks to over 50,000 square feet for periods as short as one month. Many individuals are doing this on their company’s dime as they wait for their employers to figure out when it is safe to require workers to return to pre-pandemic offices.”

• “‘In a time of uncertainty we provide flexibility to corporations and small businesses trying to figure out what their employees want,’ said Melinda Holland, WeWork head of sales for the U.S. and Canada.”

• “‘Inquiries are off the charts with very short lead times,’ [said Debra Larsen, WorkHouse’s chief executive and founder]. ‘Companies are solving for September.’” READ MORE

FINANCE

Banks have lots of cash but few borrowers: “When the economy is growing — like now — banks usually have no problem finding borrowers as consumers make big purchases and businesses expand. These loans provide better returns than Treasury bonds, which are usually reserved for times of uncertainty because banks will accept their lower rate of return in place of a risky loan. Borrowing briefly spiked when the pandemic hit, as companies tapped lines of credit. But the now-booming economy isn’t producing demand for loans, just as banks have plenty of money on hand to lend.”

• “Businesses either have enough cash already, have other ways to raise money or see little reason to undertake a risky expansion amid the still-smoldering pandemic.”

• “The lackluster demand for loans reflects the government’s success in protecting companies and households from ruin during the pandemic.”

• “The dynamic is unlikely to change until companies and entrepreneurs have a better sense of certainty about future economic conditions ...” READ MORE

Steven Wilkinson has a simple test for whether you know your own financials: “Without looking at your own financial reports. Write down the main elements of your P&L and the numbers from your YTD to last month end or just end of last year. Do the same for your Balance Sheet. Use 000 approximations for the numbers (ie. 2.5K instead of 2,500) and don‘t forget Warren Buffett‘s dictum: ‘I would rather be roughly right than precisely wrong.’” READ MORE

MARKETING

TikTok adds in-app shopping in partnership with Shopify: “TikTok has largely been known as a video app that provides entertainment and memes. Users have not been able to buy products directly in the app, even though TikTok features many influencers who often talk up clothing, makeup, and household products. Instead, users have only been able to buy goods on TikTok through ads on the app. But under the new partnership, Shopify merchants that participate in a pilot program will be able to add a shopping tab to their profiles and link to products within TikTok posts. Shopify said it expected to expand the feature to all of its merchants this fall.”

• “Shopify said sales on its social commerce channels — including TikTok, Facebook, Instagram, Snapchat and Pinterest — grew 76 percent from February 2020 to February 2021. In total, Shopify works with 1.7 million merchants.” READ MORE

RETAIL

Why would Amazon put an Amazon Fresh just a few blocks from a Whole Foods? “The Amazon Fresh concept, which launched less than a year ago in California, is the e-commerce giant's high-tech answer to a streamlined shopping experience. It positions itself as having consistently low prices as it competes in the conventional grocery space. This is different from its Whole Foods offering, which Amazon purchased in 2017 for $13.7 billion. That arm is focused on natural and organic foods and tends to have a higher price point than its sister company.”

• “That means, as with the two Amazon properties in Washington, D.C, the stores can be close together because the audiences — although there is some overlap — are different.”

• “‘You can put Whole Foods next door to Amazon Fresh because it's most likely two different customers,’ [said Brian Yarbrough, senior analyst of equity research at Edward Jones].”

• “‘Grocery is a major part of retail, and it's a frontier, right?’ Vadakkepatt said. ‘One thing we know really well about Amazon is that they have no problems experimenting, and they are perfectly okay with failure and learning from failure.’” READ MORE

HUMAN RESOURCES

Looking to hire tech talent? Here’s what the Big Boys are paying: “Companies are required to disclose information including salary (or, in some cases, salary ranges) when they hire foreign workers under the H1-B visa program, giving insight into what these tech giants are willing to shell out for talent. So, to get a sense of what salaries in the industry are like these days, Business Insider analyzed the U.S. Office of Foreign Labor Certification's disclosure data for permanent and temporary foreign workers to find out what companies pay employees in key roles, including engineers, designers, and salespeople.”

• “[At Google] a software engineer was offered $353,000, a vice president of engineering can get $475,000, and a senior vice president recently took in an annual salary of $650,000.”

• “Insider reviewed more than 200 H-1B visas that Amazon's cloud unit applied for from January to June to reveal how much it paid software developers, data scientists, marketers, salespeople, business analysts, and more. The highest-paid employees, according to that data, can make as much as $185,000 in base salary.”

• “[Apple] sponsors visas for a range of well-paid marketing jobs. One marketing manager makes $240,000, while a marketing senior director earns $325,000.” READ MORE

SILICON VALLEY

Tech workers are returning to the Bay Area: “The pandemic was supposed to lead to a great tech diaspora. Freed of their offices and after-work klatches, the Bay Area’s tech workers were said to be roaming America, searching for a better life in cities like Miami and Austin, Texas — where the weather is warmer, the homes are cheaper and state income taxes don’t exist. But dire warnings over the past year that tech was done with the Bay Area because of a high cost of living, homelessness, crowding and crime are looking overheated. Mr. Osuri is one of a growing number of industry workers already trickling back as a healthy local rate of coronavirus vaccinations makes fall return-to-office dates for many companies look likely.”

• “‘I think people were pretty noisy about quitting the Bay Area,’ said Eric Bahn, a co-founder of an early-stage Palo Alto, Calif., investment firm, Hustle Fund. ‘But they’ve been very quiet in admitting they want to move back.’”

• “Bumper-to-bumper traffic has returned to the region’s bridges and freeways. Tech commuter buses are reappearing on the roads. Rents are spiking, especially in San Francisco neighborhoods where tech employees often live.” READ MORE

THE 21 HATS PODCAST

Episode 74: ‘Every Day, I Have to Force Myself to Get Out of Bed’: This week, our conversation takes an unexpectedly dark turn. We start out talking about Laura Zander’s efforts to manage personnel conflicts and Dana White’s visits to potential salon sites on military bases and Jay Goltz’s bizarre battle with his phone company, and we think we know what we’re talking about. But we keep talking until we realize that some of the issues we are discussing are more complicated and more painful than we’d understood, as is often the case with matters of mental health. You should know this conversation contains frank discussion of depression and suicide.

• You can subscribe to The 21 Hats Podcast wherever you get podcasts.

If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren