Cole’s Mills, New York

When I moved to Carmel, NY in the early days of Covid-19, in the Town of Kent, I discovered that my house was part of a large tract of land that was part of a colonial village, Cole’s Mills, founded in 1747.  It was obliterated when the Carmel Dam turned the adjacent West Branch of the Croton River into a reservoir, and the only trace was on old maps and in library archives.  A year ago I began an effort to install a historical marker just a few steps from my house, and made presentations to the Kent Board, Kent Historical Society, and completed a successful fundraising effort.  Today, along with more than a dozen members of the Cole Family, the marker was unveiled.  

I also created a Wikipedia page:  https://en.wikipedia.org/wiki/Coles_Mills,_New_York.  Some highlights:

Cole’s Mills was settled by Elisha Cole in 1747. Elisha and his wife Hannah Smalley, both Wampanoag Native Americans, moved from Harwich, MA on Cape Cod.  They built a grist mill at the outlet of Barrett Pond into the West Branch of the Croton River in 1748. A carding mill, saw mill, and school house were added in subsequent years. Elisha and his sons were members of the 7th Regiment of the Dutchess County Militia, under Colonel Henry Ludington, during the American Revolutionary War. The land was leased from Mary Philipse Morris, confiscated after the Battles of Saratoga by the Commissioners of Forfeiture, and sold back to the tenants in 1782.

In 1888, NYC purchased the land and water rights of Cole’s Mills from members of the Cole family. By 1890, work had begun on Reservoir D, now known as the West Branch Reservoir.  Building the West Branch Reservoir required clearing Cole’s Mills and the nearby basin of buildings and vegetation, relocating Dickson Road (now Dixon Road) over a new bridge at Cole’s Mills, and building an 1,800-foot causeway, now part of New York State Route 301, which runs above the reservoir. The reservoir was put in service in late 1895 and construction completed in 1896. Cole’s Mills was fully submerged when the dam was completed and the reservoir was filled.

The incursion by New York City and its reservoirs destroyed the hamlet of Cole’s Mills and reshaped the physical and cultural landscape of the town of Kent.  Prior to the reservoirs, Kent had ninety-four farms, with 7,952 acres of cultivated land. A rural landscape of mills and dairy farms was transformed back into forest dotted by homes at a safe distance from the waterways. The NYC Department of Public Works targeted health “nuisances” throughout Kent beginning in 1893. Cole’s Mills was called an example of “the worst case of several here” with a house and mill in close contact with the water. Local residents were cast as villains and farmlands were sold off at discount rates. Putnam County’s center of commerce shifted from Kent to Brewster, and a planned railroad was rerouted from Boyd’s Corner and Cole’s Mills to Brewster.

Cole’s Mills and its 150 years of history was erased by the NYC reservoir system.  This marker is one way to revive its memory and celebrate Kent’s long history of patriotism and essential contribution to New York City’s world class water system.

The “Prime Directive” for AI

The writers of Star Trek in the 1960s recognized the potential for technology to wreck the course of civilization, so they created the Prime Directive to prohibit Starfleet crews from doing anything to “interfere in the normal development of any society.”

Many observers today see the potential for generative artificial intelligence to damage civilization on earth, but their remedies are far less eloquent and clear.  The rapid deployment of ChatGPT and other systems in their current unfinished state is proceeding unchecked.  AI ethicists have produced long lists of ethical rules for AI that are too arbitrary and complicated for current systems to implement, and seen by many to be too “woke.”  The state of AI ethics is a mess, with Microsoft dissolving its 30-person AI Ethics and Society team and Google firing the head of its AI ethics team.

We need a “Prime Directive” for AI.  Something simple and clear which speaks to the technology today and in the future, and is enforceable. 

Something like this:

The Prime Directive for AI:  No killing, no lies, no deception. 

No Killing.  With the advent of autonomously AI-piloted drones and robots, the gravest threat to civilization arises when a readily reproduceable AI-controlled device independently decides to kill, and then acts.   This is different from a warhead with a smart navigation system ordered by a human to attack a specific target at a specific time.  Since the advent of the nuclear age, human intervention has prevented simple errors from causing Armageddon, most notably when Soviet Lt. Colonel Stanislav Petrov disobeyed nuclear launch orders in 1983 arising from a mistaken signal that the US had launched a warhead.   AI systems like ChatGPT lack any similar safeguards.  All generative AI systems should be built with an absolute prohibition of killing any living thing, most especially right now when the technology is just emerging from its infancy.

No Lies.  A more present threat arises from the falsehoods that are generated by current AI systems.  ChatGPT can create elaborate and well written narratives which are completely fabricated.  Editorial cartoonist Ted Rall reported that ChatGPT created an utterly fictitious account of a 2006 trip to Uganda (he’s never been to Uganda) and a public feud with his best friend (which never happened).  It took ChatGPT just a few seconds to relate to me that “as a young boy, Thomas Jefferson chopped down his father’s apple tree with a hatchet,” confusing the famous “never tell a lie” story about George Washington with one it just made up about Thomas Jefferson.

The next version of Microsoft Office makes it easy to add ChatGPT narratives to word documents, and further automates and accelerates the potential for “fake news” to bedevil our society.   While Free Speech is valued in America, and protected by the First Amendment, even publishers are liable when they knowingly publish falsehoods and slander.  At minimum, Generative AI needs to be held to a similar ethical and legal standard

No Deception.  It was widely reported that GPT-4 was able to pose as a human and convince real people to complete a Captcha “I’m not a robot” test.  And many of us have been frustrated by voice recognition systems and web chats that appear human but drain our patience with their in-humanity.  Any output from generative AI needs to be clearly labeled as computer-generated, and not from a living beingAs the interfaces become more advanced – text, voice, robotic – the potential for generative AI to masquerade as human and control human behavior is frightening.

* * *

These three basic principles — No Killing, No Lies, No Deception — need to be a bedrock of the design of any generative AI system.  Ideally, the tech industry itself should establish these as part of a Prime Directive and not release or propagate AI systems which don’t follow these basic guardrails.  Congress and the EU should also review current laws and make clear that companies and individuals that propagate AI systems and outputs that violate these standards are liable for the consequences. 

The late Stephen Hawking predicted in 2014 that AI could end mankind.  Current AI ethics “experts” have muddled this debate and gotten lost in the weeds.  It’s time to focus on some core inviolate rules for AI before it’s too late. 

Angel Resiliency during COVID-19

Angel investing in the US has been remarkably resilient during COVID-19 as angels have adjusted to remote operations and actively sought new opportunities, as well as loyally supported their portfolio investments.

Angel investing showed the greatest growth in the number of deals done in the Fourth Quarter of 2020, according to On Grid Ventures analysis of Pitchbook/NCVA quarterly data.

Angel investing deals done grew 9% in the Fourth Quarter, while Seed and Early Stage, activity contracted -35% and -26%, respectively, and Late Stage increased 6%.

What’s going on?  I suspect Angels think like entrepreneurs, and see opportunity in times of extreme change.  Since they are basically accountable just to themselves (and, as some angels are quick to point out, their spouses!), they are freer to take risks as they seek opportunities. 

VC’s may have similar instincts, but are more heavily influenced by fund investment considerations and LPs.  Fundraising for some has been severely limited, and available funds were diverted to support troubled portfolio companies.  LP’s also tend to be far more conservative, and many lobbied their VC funds to cut back investing, and not make planned capital calls.

This is nothing new. It repeats the pattern from the Global Financial Crisis in 2009 when Angel investing grew 45%, while Early Stage and Later Stage VC contracted -35% and -21%, respectively.

When Should I Apply for Angel Funding?

So you decided to apply to an angel network for funding.  When is the best time to apply?

Before you run out of money, of course.  But most startups these days have some flexibility given the low cost of lean design as well as funding from self, friends and family.

If you have a truly exceptional startup, or a truly exceptional track record, don’t wait, apply asap.  What is a truly exceptional startup?  As Justice Potter Stewart said in 1964, “I know it when I see it.”

If you are in the other 99.8% of startups, you should be more strategic about timing.

Some angel groups like to be the first outside funding source.  These favor earlier companies with lower valuations, and regularly lead rounds of $500k and up.  For them, the sooner you apply, the better.  Consider them as soon as you need funds beyond friends and family, and have a hint of demonstrable traction.  New York Angels is one of these groups.

For most all angel networks, better to try to wait until you have basic business traction, which I see as:
  1. A working product,
  2. Some revenue and market validation,
  3. Your co-founders are in place (e.g., “I’m looking for a co-founder with [insert skill]” is a red flag.)
It is also better to wait will you have some basic financing traction.  This means:
  1. You have a credible lead investor,
  2. You have at least $100-200k and 20% of your round committed,
  3. You have deal terms largely agreed by the lead and committed investors.

Yes, this is an chicken and egg problem. How do you get there without funding?  Wing it?  Sorry about the pun.  Here’s where being a scrappy entrepreneur is a plus.

Most companies that raise angel network funding successfully do so after they have some business and financing traction.  There are many more entrepreneurs seeking funding than there are early stage angels and VCs.  Supply and demand means that investors can wait, at least in most cases. Harvard Business School Alumni Angels is one large angel network that prefers companies with at least some basic business and financing traction, and most angel networks fall in this group.

Waiting and self-funding for more months than you’d like isn’t fun.  But it may save you time and money, and lead to more fun over the long haul.

Some additional suggestions as your move ahead:
  1. Focus first on angel groups and micro-VCs who could lead your round.
  2. If you do pitch before having a lead investor committed, be prepared for other investors to wait until you find a lead.
  3. Put forward your ask for funding amount and terms, and indicate that you are negotiable once you identify a lead.  [If you say that terms are “TBD and up to the lead” you risk coming across as clueless].
  4. Don’t be so greedy that spend too much time with a funding ask that is above the market, and you run out of money and never raise a dime.
  5. Never insist on a SAFE note with a serious angel.  They know that is so unfavorable to angels that it can easily be a worthless investment in at otherwise successful company.

Good luck!

 

The Facts on Deal Valuation and Structure

Attention Entrepreneurs:  Investors at different stages have varied interests so you are likely to get different counsel from Big VCs, Big Accelerators, and other Big Shots.

I’ll keep this post brief and fact-based.  Early stage financing has supply and demand, and deal terms and valuation are determined by market factors.  When you determine valuation and deal structure for your company, consider the current data on Angel financing.

66% of Angel financings are done at a pre-money valuation of $4.5 million and under.60% of angel financing is done with Preferred Stock.

The source of this data is the Angel Capital Association’s new Angel Funders Report, dated August 2018 and released October 2018.  Drawn from 432 investment rounds in 2017 across 393 companies totaling $102 million invested.  Companies were located in 36 US States, Canada, and Israel.

So when you set your terms, the closer you can price your deal based on its merits relative to other angel deals getting funded, the faster your funding round will go, and the quicker you can get back to your business fundamentals.

Crash! NYC Angel/Seed Funding Down 25% in 2017

2017 was a down year for angel/seed funding in NYC!  Despite the continued growth in NYC’s startup ecosystem, particularly from eager first-time entrepreneurs, the number of seed deal funded in 2017 declined to 235 from 328 in 2016, a decline of 28%, according to AlleyWatch.

 

 

 

 

 

 

Seed stage funding in NYC declined to $361 million in 2017, from $483 million in 2016, a decline of 25%.

While the data from other markets has not been assembled, I don’t expect NYC is an outlier:  2017 was the year of me-too startups, with companies piling on and overhyping areas like AI and Big Data.  Investors saw through the clutter to be more selective in 2017.  Median round size increased to $1.25 million, up 25% from $1 million, a sign that investors were more confident concentrating more money in fewer deals.

23 New Geo Big Data Sets for Smart Cities

The universe of geographically-tagged big data is growing exponentially.  From Brookings, here are 23 public and private sectors generating data 24/7 across the globe.  The possibilities are vast.

Top 15 New York-Based Venture Capital-Backed Exits 2012 – 2017

The Top 15 New York-Based Venture Capital-Backed Exits 2012 – 2017

As the NY early stage and VC community grow, so do the number of larger exits.  From CB Insights, here are the top 17 NY VC-backed exits for the past five years, with Yext at number five with its April 13, 2017, IPO.

 

 

GeoDisrupting Commerce: IoT, Beacons, Robots

GeoDisrupting Commerce: Iot, Beacons, Robots

retail-iot-market-map

 

These are the top companies bridging the physical and digital worlds, based on CB Insights.

Company Chart

Retail IoT Company List
Company Category Select Investors
Hiku At-Home Shopping Buttons Otter Rock Capital, Plug and Play Accelerator, Firsthand Technology Value Fund
Kwik At-Home Shopping Buttons Norwest Venture Partners, NFX Guild
Crowder Beacon Analytics And Marketing Wearable IoT World Labs
Estimote Beacon Analytics And Marketing Bessemer Venture Partners, Innovation Endeavors
Footmarks Beacon Analytics And Marketing Commerce.Innovated
Freedom Smart Labs Beacon Analytics And Marketing Kapil Goel
Kimetric Beacon Analytics And Marketing Microsoft Ventures Accelerator
Minodes Beacon Analytics And Marketing MarketTech
Monolith Beacon Analytics And Marketing Startup Wise Guys
Movvo Beacon Analytics And Marketing Caixa Capital
Proxidyne Beacon Analytics And Marketing Undisclosed
Radius Networks Beacon Analytics And Marketing Core Capital Partners, Contour Venture Partners
Resun8 Beacon Analytics And Marketing Undisclosed
Sensorberg Beacon Analytics And Marketing WestTech Ventures, Berlin Technologie Holdings
Swirl Networks Beacon Analytics And Marketing Twitter Ventures, Longworth Venture Partners, Softbank Capital
Euclid Analytics Beacon- And Sensor-Based Analytics Harrison Metal, NEA, Benchmark
Innorange Beacon- And Sensor-Based Analytics Undisclosed
Measurence Beacon- And Sensor-Based Analytics Undisclosed
RetailNext Beacon- And Sensor-Based Analytics August Capital, Commerce Ventures, Nokia Growth Partners, StarVest Partners
Scanalytics Inc. Beacon- And Sensor-Based Analytics Wearable IoT World Labs
Tamecco Beacon- And Sensor-Based Analytics Yume no Machi SoZo Iinkai
Torch Beacon- And Sensor-Based Analytics Target Accelerator Program
VideoMining Beacon- And Sensor-Based Analytics Ben Franklin Technology Partners
Viewsy Beacon- And Sensor-Based Analytics Qualcomm Ventures, Kima Ventures
Walkbase Beacon- And Sensor-Based Analytics SBT Venture Capital
Aislelabs Beacon-Based Marketing Salesforce Ventures, Rho Ventures
Beabloo Beacon-Based Marketing Baozun
Bfonics Beacon-Based Marketing Undisclosed
Blue Bite Beacon-Based Marketing Undisclosed
ConnectQuest (CQ) Beacon-Based Marketing Undisclosed
Ebizu Beacon-Based Marketing Cradle Fund
Ifinity Beacon-Based Marketing SpeedUp Venture Capital Group
Shelfbucks Beacon-Based Marketing Capital Factory
Aisle411 Indoor Mapping Cultivian Ventures, St. Louis Arch Angels
Cartogram Indoor Mapping Undisclosed
Indoora Indoor Mapping Startupbootcamp Smart Transportation & Energy
Cosy Inventory Tracking 500 Accelerator
QueueHop Inventory Tracking Y Combinator
Carttronics Loss Prevention Undisclosed
Gatekeeper Systems Loss Prevention Undisclosed
Fellow Robots Service Robots HAX, Crowdfunder
Simbe Robotics Service Robots HAX
Oak Labs Smart Dressing Rooms Wing Venture Capital, R/GA Accelerator

 

Use the NYC #6 Subway to Convert Fahrenheit to Celsius

Yes, you can do it.  Each stop on the 6 train converts to a round 5 degree temperature in Celsius.  Mostly, at least.  86th Street:  86°F = 30°C.  And on down after that, with 14th Street 14F = -10C.

6train

 

28th Street?  Just ignore it.