@Varkain

Happenings and other random stuff at Varkain

WHY did we get here?

“Stress is the fertilizer of creativity.” – Jonas Hodges

Should this prove true, we are in for an explosion of creativity! In the absence of it, the country will not survive. Everyone is intimate with the pandemic because you can’t turn on the news or pick up a paper without being inundated with the current number of dead people, supposedly from Covid-19. 

A quick recap of the data points that are not in dispute. I make that distinction because so much of what we are told is not factual.  We know that in December of 2019 China admitted to a patient with symptoms of coronavirus. Whether they knew of earlier cases is not known. Mid-January the virus was in Thailand, and the WHO, a mouthpiece for the Chinese press, states there is no evidence of human to human contact.

Jan. 31st, Trump restricts entry into the US by foreign nationals coming in from China, other than American citizens. The move was met with vile criticism from multiple sources.

 Feb. 29th, the first death in the US attributed to the virus. It continued to spread throughout the US, with nursing homes and large population centers, recording the most death.

March 13th the brakes are slammed on the US economy with shut down orders to all 50 states. In a matter of weeks, the US went from an all-time low in unemployment to 30 million out of work. Once free people were threatened if they dared to violate the heavy hand of some state governors.

My question is: WHY? did we surrender our freedom so easily?  We have experienced other pandemics, terrorist attacks, wicked flu seasons, and a long list of incidences that resulted in more death than the current virus.  The country never skipped a beat, much less entertained a shut down.    In 1968–69, the Hong Kong flu ravaged the world; it wound up killing more than one million people worldwide, over 100,000 of them in the United States. No lockdowns were imposed, and people still went to work. There was less bus travel, social distancing and more washing of their hands.

Why the drastic response to Covid-19?  Who had the most to gain or was more motivated to extract the maximum amount of damage from this pandemic?  The best way to determine that answer is to look at the facts. 

  1. We know that the media (CNN, MSNBC, ABC, NBC, CBS, etc.) has tried to get Trump out of office since 2016.
  2. We know that the FBI and DOJ went to great lengths to get rid of Trump with lies, false accusations, impeachment, special prosecutor, relentless attacks, along with Trump haters on both the left and the right. To date, they have failed.  To them, the pandemic was a golden opportunity to do sufficient damage so that Trump would not get a second term. 3. With that in mind, the mainstream media had a mission. The anti-Trump crowd eagerly participated and together they managed to stoke enough fear in the public to bring the country to its knees. It’s hard to grasp that WE, the working, tax paying citizens, just handed our rights and freedoms over to the federal and state officials. The result has been an economic disaster that will have consequences no one has even thought of yet.
  3. With that in mind, the mainstream media had a mission. The anti-Trump crowd eagerly participated and together they managed to stoke enough fear in the public to bring the country to its knees. It’s hard to grasp that WE, the working, tax paying citizens, just handed our rights and freedoms over to the federal and state officials. The result has been an economic disaster that will have consequences no one has even thought of yet.

HOW did the MSM and the their willing accomplices pull it off? 

  1. They used FEAR.  Everyone has heard that the stock market is driven by two powerful emotions: FEAR and GREED.  Look at a recent chart of the market and it’s obvious that fear is the more powerful.
  2. There is an absence of logic or rational thinking when emotions are in charge. Conclusion: extract as much fear as necessary to make the public pliable and at the mercy of “experts”.
  3. Right on cue, the experts concocted a computer model.  QUESTION: what data is a computer model based on? ANSWER: none – it’s guesswork.  Nevertheless, it was rolled out and used to make predictions on how many would die as a result of Covid-19.  Since the goal was to paralyze our brains with FEAR, the public was given the highest number in the model.

Consider the damage done by blindly following models that are nothing more than guesswork. Elective surgery was cancelled nationwide because hospitals would be overrun with virus patients. OOPPSS – no crowded hospitals and the loss of revenue that elective surgery would have produced is not available. Hospitals are now in financial trouble.

The Gov. of New York, demanded 40,000 ventilators. He only needed 5000. The same governor demanded thousands of additional hospital rooms to accommodate the flood of cases from the virus.  Trump and his team delivered; now the mayor of NYC wants several billion to keep the city operating. Is another model being used to arrive at that number?

Testing has been a problem and the media has hung that around Trump’s neck when in fact, the CDC (more experts) put the US behind by more than a month because the initial test they distributed was contaminated.  Then the FDA used its heavy hand to forbid the states and independent labs to make and use their tests.  While that was finally overruled, the testing process was delayed due to incompetence and power-hungry bureaucrats.

In order to support the bogus model being used, the CDC said that anyone who died and “might have had” the virus (tested or not) should list the cause of death as the virus. This was confirmed by Dr. Birx several times during the daily press briefings. Recently we learned from two CA doctors that there is pressure applied to list the cause of death as COVID-19, regardless of the truth.  As late as March 31st, another expert, Dr. Fauci, cited a model that put the deaths at 240,000. 

Yet, when the MSM wants to blame someone for mistakes, they point to Donald Trump who since the beginning, has followed the lead of “the experts”.  But then the MSM and anti-Trumpers are not trying to get rid of “the experts”.

Returning to the original question of WHY, I am of the opinion that the public became easily manipulated because they were driven by FEAR: for themselves, for their family, their livelihood, their way of life, etc.  Every aspect of life was threatened by the predictions of bogus models being used – built by the experts – not by Trump.  Human nature responded as expected, even hoped for, by the cynical segments looking to destroy Trump.

There are a number of lessons we can and should learn from what has taken place to date. And of course, we’re now told that this virus is not done yet, perhaps the worst is yet to come.  More guesswork!  But it does serve its purpose of keeping the public on edge. 

One of the few lessons that should take hold versus all the others that will be dismissed, is the financial aspect.  Faced with a new crisis, pandemic or otherwise, would you be less easily seduced if your financial house was in order?  If you had at least 4-6 months of emergency funds put aside, would you think more rationally versus emotionally?  My opinion is that people behave more intelligently when they have some financial security. 

You have control over that and perhaps little else, but it will make all the difference.  We must stop making it easy for the elites in government to rob us of our freedom.  Early in life I heard over and over “if you can live on 100%, you can live on 90”.      

As Dad Always Used to Say…

The life of any startup can be divided into two parts — before product/market fit and after product/market fit.

Marc AndreessenAndreessen Horowitz General Partner and Serial Entrepreneur

The only thing that matters is getting to product/market fit.   Rachleff’s Corollary of Startup Success:  Andy Rachleff is the co-founder and CEO of Wealthfront; also co-founded VC firm, Benchmark Capital.


Over a decade ago, Andreessen wrote the following statement: “If you ask entrepreneurs or VCs which of team, product, or market is most important, many will say team.”  It’s obvious from the quotes above that the “team” answer is incorrect.  Hers’s why according to Andy Rachleff, the #1 company killer is lack of market:

  • When a great team meets a lousy market, market wins.
  • When a lousy team meets a great market, market wins.
  • When a great team meets a great market, something special happens.

Startups should be obsessed and focused on getting to product/market fit. The path often takes several iterations, pivots, and includes costly mistakes. Companies should begin with an MVP (minimum viable product) with features that are compelling enough to get people to buy it.  “Minimum” is critical because several iterations will likely be required before you can prove product/market fit.

When you attempt to identify your target audience, look for those who are “desperate” for your product, either because the product is new and a disrupter; or your product is less expensive, easier to use, more convenient, or even more available.  Once you have identified your “niche” market and become accepted, you can scale, having found product/market fit.

There are tests available to prove product market fit:

  1. The Sean Ellis
  2. The David CummingsTest

What brought this topic to mind was a recent article in INC. magazine entitled “Raising the Bar”. It summarizes the story of the RX BAR and the two founders. As best friends, they started the company in the basement of Peter Rahal’s home with only $10,000.  Inspired by the lack of a simple, clean protein bar, they created a minimalist formula and made their label on PowerPoint.  Their initial marketing effort was going door to door, giving them away for free to retail outlets and cross-fitness gyms.

And then, the classic line was uttered by Peter’s father as they discussed finding investors while working in Rahal’s kitchen.  Peter’s father entered the kitchen and the summary of his comment was, “You guys need to shut the fuck up and just sell a thousand bars…”  The founders called it a defining moment.

Dad told them to find product/market fit rather than worry about funding, etc. Obviously, they found their market and 5 years later sold to Kellogg for $600 million.  Peter Rahal and Jared Smith still run the company today as a subsidiary of Kellogg.  Whether by accident or knowledge in business, Peter’s father correctly directed them to make sure their product was accepted.  They had a great team and a receptive market and something special did happen.

Vegas baby, Vegas


As the Entrepreneur in Residence for Varkain, I feel very fortunate to be a part of an amazing, up-and-coming venture fund in Las Vegas, NV. We’re not known for our tech companies or tech entrepreneurship, but we hope to change that. General Partner Laurie Hinckley is controlled-aggressiveness personified and I mean that with the utmost respect. If you asked any of our partner companies, they would tell you that Varkain doesn’t waste time when it comes to money and we never waste an entrepreneur’s time, which might be more important.

When I travel to other markets (Utah, SoCal, Denver, New York, Boston, Austin) to raise money or pitch it becomes increasingly more obvious to me how different Varkain really is. When I meet with entrepreneurs at various accelerators or when they come to town, I am always told how much they appreciate Varkain’s direct approach and wish we weren’t hiding in Las Vegas.

I think Varkain’s short-term success can be attributed to its infancy and good fortune avoiding bad habits or predisposition to how things are “normally” done. It can also be attributed to Laurie’s great analytical mind and her willingness to dive deep into companies and industries. Varkain also has a great network developed over the past four years and willing mentors who have assisted us along the way. Being from Vegas, we don’t see much local deal flow, but we do get introduced to great companies from a trusted network and that likely has something to do with our success. But ultimately, nobody forces Varkain to cut checks and it’s on our head to pull the trigger, so to speak. We also benefit because we don’t have quotas or LPs to please. Being independent clearly, has its perks.

Varkain has big plans for the future. I’m not sure how long I’ll be involved as JRNL grows, but Varkain’s goals are mighty and the people working behind the scenes are even bolder. We hope to bring great tech to Vegas and we expect to make it a place where entrepreneurs with great ideas seeking to change the world come to be lifted up and get a real shot.