“Consumerization of the Enterprise” is one of those phrases that now feels old, in part because it was used so much without real examples. That was then, and this is now — we are now starting to see enterprises adopt design-oriented products like Slack and Zenefits, to name a few. Looking back now, it shouldn’t be a surprise that products designed with principles to suit everyday consumers are preferred by workers at larger companies.
This got me thinking — what about other prevalent consumer business models today? Could concepts like “on-demand services” or “collaborative consumption” take root inside older, larger, perhaps stodgier, less sexy industries? I wrote about this with respect to on-demand services here. While I didn’t find many on-demand services with consumers as the end customer (except for Boomtown), I did start to see some interesting companies in the sharing economy, but now applies to other industries, specifically related to industrial equipment.
Growing up studying economics, textbooks beat into your head that western economies were stronger in part because they were fueled by consumption. Buying things drove GDP, and that had a strong, trickle down effect. Then, 2001 and 2008 happened, and went the tide went out, the people (and industries) who were naked had to scramble to find new places to eek out efficiency and lower their own operational and capital costs. We’ve seen what’s happened to consumer markets, with the success of companies like Airbnb (full list of “sharing economy” companies on AngelList) — so, can larger industries benefit from the trend?
What I found out is: Yes. The first company I found is Cohealo, based out of Boston. When I found them and finally met them, they’d already well passed me by as an early-stage investor, and they’re well on their way to the big time, helping hospital networks share their high-end equipment which requires high, upfront capital expenditures but often just sits around waiting to be used. Cohealo found the white space between centers which own these and those which need them, and now the sky’s the limit for them.
The next two companies I found, I invested in them. The first is Asseta, which provides an aftermarket for industrial parts for semiconductor companies, a capital-intensive business which Asseta helps provide more financial efficiency.
And the second company I found was Getable. There’s a fun story behind it. I had been tweeting about this subject after posting about it, and Kevin from Getable jumped into the conversation. I knew construction, like medical equipment, was a huge industry ($40B+ industry), big enough for a concept like sharing to pervade. It took a while for Kevin and I too schedule our meeting to talk more about this, and I had no idea how they were doing as a company. Finally, Kevin called me to apologize he had to cancel a meeting because they were just about to close a round — and, the light went off in my head.
“Can I invest, too?”
Kevin was busy as a co-founder dealing with the round, but he took my request seriously, checked out my references, and after a few weeks, managed to make a bit of room for me in the latest Series A round that was announced in February. I had a bit of time to really dig into the Getable’s metrics, which now already services more than 50 construction companies across 250+ job sites, process over $3M in construction rentals (saving on average over 20% for companies), and also driving over $20k in sales to suppliers who join the Getable network.
I am grateful to Kevin for taking my call during a stressful time and taking the time to read my posts on the matter. In return, I am now allowed to invest alongside a great syndicate which led Getable’s Series A as the company marches further into a massive industry ripe for new technologies and new business models. Finally, it’s worth noting I wouldn’t have arrived at Getable if I didn’t see the concepts take root among consumers and then, write about them here on my blog. The writing helps reinforce what I see taking place, and then helps me connect with new friends like Kevin, and those connections lead to things that I couldn’t have planned with any grand strategy. That feels good.
Disclaimer: This list is not likely complete nor precise. Please read on: A few weeks ago, I looked at U.S. consumer unicorns and scraped public databases (imperfect sources) to find which institutional investors got into companies that would eventually turn out to be worth over $1 billion. Specifically, I looked back to 2008 and tried to find funds which invested when the company was valued at or under $100m. These are just arbitrary parameters.
Now, I’ve done it for enterprise/B2B companies in tech which have started in 2005 or after in the U.S. Note, there are more of them, but the total enterprise value of these companies added up would still be dwarfed by what has happened in consumer services. Again, please note the data isn’t 100% precise, so if you see an error or omission, please just tell me and I’ll fix it. Also, some of these companies have ballooned above $1b (like WeWork), so while the pre-$100m rule doesn’t apply exactly to that company, I kept it the same here — I don’t know IRR but safe to say some of these firms have outsized returns on just one investment, so congrats to all who made the list.
Mention frequency > 1 are: SV Angel (7); Sequoia (5); Lightspeed (3); Greylock (5); Accel (3); Khosla Ventures (3); Kleiner Perkins (2), Blumberg (2); Benchmark (2); First Round (2); a16z (2); Felicis (2). Note, also, that many YC companies focused on B2B like Zenefits and Optimizely on their way to the billion dollar mark, so if you have suggestions there for a “too watch out for list,” I’ll update this. And, as they say, once is lucky (but still awesome), two is good, and three a pattern.
Being a new, inexperienced, and small investor, I really have to “take what the defense gives me.” Put another way, I am often forced to look in areas and stages where more professional investors wouldn’t go. Sometimes I ride along and go late, but lately, I’ve also been going early, and one of the things I try to do in these cases is see if the company has what it takes to get into Y Combinator in the next 3-6 months. Here, I help them prepare.
People may think of Y Combinator as a startup incubator, and in some cases it can be, but it’s really a startup selector and accelerator. And, over the past two years, it has quietly been moving upmarket, as well as growing in absolute size. This means on Demo Day you can see three companies in a row present, where one has zero revenue, one is making about $4k a month, and one is making $350k/month and growing. This distorts the Demo Day vibe a bit (and potentially puts less mature companies in a tough spot), but ultimately, the YC engine is about a huge, smart, network effect and growing. The best startups coming out of there are doing both, leveraging the network for advice and new customers and growing by any means necessary.
Which brings it back to me and Haystack. I love going to Demo Day but it’s also so big and fun and a firehose, it’s hard for me to make decisions so quickly. So, I meet a bunch of the companies earlier, like many others. So, I also try to meet people early who I think have a great idea and incredible drive and who could benefit from applying and getting into YC. I have a company in the current batch I did this with, and while it was a bumpy road, it worked out and the founders are loving the experience.
A final note: I do not have any special ties with YC to help with applications, and this approach doesn’t work all the time (I’m 2 for 3), but I do think it’s an opportunity to find founders who have already started something that’s beginning to work, and a big idea — if they’re thinking about something big, if they’re leveraging their limited resources, and if they’re focused on how to grow, it’s a fair shot to get into YC. Getting into YC doesn’t mean the company will be successful, of course — but the network, peer & time pressure, and focus on growth gives an early company a great chance to get to the next key milestones.
As someone who worked on consumer mobile products for a good number of years (and who carries the scars of the endless search for mobile distribution), the chatter about new mobile services using text messaging as the interaction layer has been fascinating to watch. Kent Goldman from Upside has some of my favorite tweets about the emergent trend, remarking “Good old SMS is the new UI” and Jonathan Libov of USV had a longer post (click here) about how this trend developed as a UI and where it could go in the future.
With the release of Magic and Luka.ai, why is all of this happening at the same time? When Twitter launched back in 2006, its signature 140-character limit was originally created and imposed in order to ensure tweets fit inside text messages, which were limited to 160 characters. Since then, users could always tweet via text through Cloudhopper by syncing their phone to their Twitter account and texting their tweet to 40404. I still do it often when I’m on the go and don’t want to open TweetDeck but have a question I want to ask or thought I need to share in the moment.
Here’s a brief recap of how we got here:
Dearth Of Mobile Distribution Dampens Developer Libido: If you’ve read this blog over the years, I am a broken record on this topic – mobile distribution is so hard to engineer, yet while the overall market size of mobile users creates the largest technology market we’ve ever seen. For an enterprising mobile developer who has tried his/her hands with a few apps only to never get distribution, these conditions can force mobile app makers to look for other ways to capture consumer attention on phones.
Global Tidal Wave Of Messaging Apps: We all understand this, I trust — the massive footprint of mobile messaging apps which will eventually turn into commerce, interaction layers, and much more.
Avoiding App Store Noise and Taxes:Kent pointed out releasing a service via SMS also allows developers to avoid the morass which are the mobile app stores. This also reduces developer libido, working so hard over an app only to see the store flooded with copycats, black box featuring schedules, and drastic changes in UI which reduce search functionality and browsing. I’d add to Kent’s point that for digital transactions for services rendered through the app, some of these new SMS services could provide a bypass around Apple’s 30% toll in the app store.
Reduced Cognitive Load Requirements: It’s hard to design a transactional mobile app where the user doesn’t have to make lots of decisions. Uber is one of the few. But, if I could just text “I want X delivered a bit after 8pm” it’s just easy, and I don’t have to search for an app, open it, wait for it to load, and then find the input areas, etc.
Easier User Onboarding: Asking to download a mobile native app has many steps. Find the app. Push button to download and/or use TouchID to verify download. Wait for the software to arrive. Open the app, wait for it to load. Then, sign up, register, perhaps go through a tutorial….ah, screw it, I just want my burrito and some organic juice. Another friend, Robert Stephens, pointed out it’s an easier request of the user’s time and attention, and after a few interactions, an easier upsell to download the native app. But, to start, asking a user to just “Send us a text to 70707 to get started with Sandwich Valet” is a pretty easy call to action.
Immediately Cross-platform:Kent also pointed out going text-first on mobile also makes the service omni-platform from Day 1, even for a Windows Phone. That’s a joke. But, not really, think of Xiaomi in China or other OS and app ecosystems emerging. Whereas many startups are thinking about going iPhone-first, some of these new services can service everyone right out of the gate.
Conversational UI: This is sort of an aside, but related….My friend Max shared a screenshot of Luka.ai and called it “Conversational UI,” which is clever — delivering a service (in this case, in a mobile native app) in a format where users feel like they’re texting with their friends.
Gateway To Mine Our Conversational Patterns: Last year, we started to see apps deployed which mined our emails to build up our profiles and preferences for eventually delivering a predictive or AI-based solution. Like email, getting into our native messaging clients like SMS provides developers another fertile ground for mining our conversational habits and preferences. People have been wondering aloud about “How can Magic scale if humans are providing answers?” and the answer is, often, “AI.” Eventually, machines will be communicating with us, and we will likely not have any idea.
Potential Drawbacks To This Strategy: This all sounds great, but what are the drawbacks? It’s hard to build a bond with the user without the mobile app. Not having a mobile app blocks the service from leveraging core phone sensors (mainly GPS and camera). Some commerce functions require a browsing interface or creating a basket of goods, in which case typing out the basket is inefficient. There’s also a business model consideration for services which launch here but are on top of other services — additional tips and fees could conceivably add 3x to COGS of an item’s true cost. And, well, we must only believe it’s a matter of time before Messenger, Whatsapp, Snapchat, Instagram, maybe Twitter, and others do some version of this, too, inside their own “chat” experiences.
Like everyone else blabbering on about unicorns, I catch myself reading the posts, too — and many LPs I talk to often just want to know, “How many unicorns do you have?” I’m partially joking, but it’s directionally true. These are the companies which drive the outsized returns. However, I wanted to ask a slightly modified question and see what public data sources would reveal. I wanted to focus on America, on consumer companies that have grown to a $1Bn of private market value since 2008., and specifically on the institutions which were able to invest relatively early — not later stage investors. Here’s the list I came up with, based on a conversation on Twitter. (Disclaimer: Please let me know if I missed any company or fund, happy to amend this!)
Since 2008, the following consumer-facing companies (U.S. HQ’d only) have been formed and reached a private market valuation of at least $1Bn. I’ve also included the only the institutional funds (even if small) who were in the round before a $100M pre-money valuation, give or take, based on public sources — note, 1) I may have not listed a fund, so please correct me if I need to, and 2) I am not listing individuals:
Uber / Lowercase, Benchmark, Structure, Founder Collective, Kapor, First Round, *AngelList Pinterest / Bessemer, FirstMark, High Line Whatsapp / Sequoia Instagram / Baseline, a16z, Benchmark, Lowercase Waze / BlueRun, Magma, Vertex Oculus / *Kickstarter, Formation8, Spark, Matrix, Founders Fund, Big Ventures Nest / Shasta, Kleiner Perkins Tinder / none (*Benchmark now on BoD) Living Social / Revolution, Grotech, USVP, Lightspeed Groupon / NEA, Accel, SV Angel Houzz /Advent, Sequoia Square /Khosla, First Round, SV Angel Snapchat /SV Angel, Lightspeed, Benchmark Wish /XG Ventures, Caffeinated, Felicis, Digital Garage, CRV, AME Cloud, Formation 8, GGV Instacart /Y Combinator, Khosla, Canaan, Sequoia, *Funders Club Tango / Hambrecht
Assuming this list and rundown is true, what can we glean from it? Well, no surprise, Benchmark and Sequoia are both early and swinging big; First Round and SV Angel caught a few, as did Khosla and Lowercase, then there’s actually plenty to go around for the rest, as many firms have one — and two companies above were actually part of crowdfunding platforms (while one was on Kickstarter, but no equity was sold there). Finally, consumer is what grabs everyone’s attention and what the tech and popular media focus on, but relative to enterprise & B2B startups, there are just fewer consumer companies (16 since 2008, by this case in the U.S.) that reach $1B status — however, the total market cap of the consumer companies is much larger, hence our collective obsession and fascination of tracking such things. Oh, and LPs care, too ;-) By the way, if I only started counting from 2010 onward, the list for consumer would drop from 15 to only 10, and a good portion of them have been acquired already. Of course, there are many more in the pipeline, and if I checked on this list in a year, there will be more.
Late last year, in one of my many chats w/ Connie (who created StrictlyVC), we came upon the topic of “Hey, how could StrictlyVC be something more than it is today?” Big question. We batted around a ton of ideas. I was willing to help on whatever made sense, and Connie — juggling a daily newsletter and a bunch of other things — decided on a few live events for 2015. Thus, “The StrictlyVC Insider Series” was born.
Connie had her first event last week in San Francisco, and the turnout was great, all readers of her newsletter getting to meet live, in person, in the beautiful offices of Next World Ventures (which was also hosting an original Banksy — see pics below). We were lucky to book a star lineup — I kicked things off in conversation with Keith Rabois, then Mark Gainey (Strava founder), and the event closed out with Naval from AngelList & Connie in a 1:1 discussion. If you’re interested in the world of venture and you haven’t already signed up for StrictlyVC, take a look at Connie’s excellent post-event reporting which recapped the conversations about Strava, AngelList, and two separate posts (Part I & Part II) on all market insights from Keith Rabois. (Sign-up here for StrictlyVC.)
In particular, I want to highlight the discussion with Rabois (again) and would encourage you all to read through Connie’s synopsis. In the first part, Keith makes a more detailed case about why private companies should be going public in today’s environment, and why it’s unhealthy (and an excuse to avoid scrutiny) for the overall ecosystem. The full argument from Rabois is captured here, by Connie. In the second part, Keith and I discuss how larger VC firms can think about having a multistage strategy of investing at seed, traditional Series As and Bs, and then on to growth. I see more firms wrestling with this issue as company formation becomes quicker, cheaper, and flooded with micro- and crowd-based funds. See more of Part II here.
Finally, congrats again to Connie and her readership at StrictlyVC. What may look like a simple daily newsletter on the venture industry requires a ton of work, focus, and dedication. And, we are already planning the second event and talking to a few speakers. From what I see so far, it will be fantastic, and as soon as we know the date, time, and venue, you’ll want to pen this in your calendar.
Below are some topics that have come up often lately in conversation with early-stage founders, so I wanted to write them down. Most of them are not related to each other, so I just smashed them into one post for brevity’s sake. I hope some of this resonates with you and, if you see something different, I’d love to hear your perspective. -Semil
Owning The Metrics: At a certain point in a company’s fundraising path, the foundation of conversation shifts from promise to data. Executive team, market, and vision remain critical, no doubt, but so much of every conversation, every piece of diligence and modeling, revolve around metrics. One thing I’ve observed is the best executive teams don’t just grasp their metrics — they own their metrics. Owning the metrics means the team has defined each term, pegged them to industry standards, and has set up systems to measure, record, and slice data in ways that demonstrate a firm grasp of modeling, ratios, and drivers. While investors can fall in love with narratives, a grasp of the metrics can instill a more rational level of confidence.
Confusing Inbound Interest With Real Interest: This scene usually unfolds as follows. The founder receives a cold email from an investment fund. Often, it will come from the big dog at the fund, some times an underling. A few of these rack up, and the founder starts saying “we have inbound interest.” No, you have inbound email, and inbound email is not necessarily interest. Most of this “interest” is just trolling. So, how does a founder measure real interest? I’ve written about this a bit in a post titled “Turf Signaling.” Read it. Then, ask yourself: Will this investor engage in conversation on email, and/or hop on the phone? If that goes well, will the investor come to your office or a place that’s convenient for you? The moment you start bending to the schedule of the investor who emails you, you’ve already signaled you’ll go out of your way for him/her. You’ve signaled your intent before even meeting the person.
Anticipating Reference Calls: In the diligence process, an interested investor will talk to customers, big and small. The easy tip for the founder is: Train those references! Reach out well in advance, spend time with them, explain to them that investors will be reaching out, explain the process, and do it early. Priming those conversations helps make for smoother diligence, and also demonstrates the executive ability to anticipate events, to marshall resources, and to engage third-parties in the success of your company.
The Peculiar Seasonality Of Valley Fundraising: This comment only replies to larger investment rounds, say those of about $8M and above, the types the very large Series A funds now make. (For rounds small than $8M, this doesn’t apply.) There is a seasonality of how larger rounds are raised in the Bay Area. While deals can certain “close” in the summer or in late November and December, those times in particular are not great times for kicking off a fundraising process. (Read an earlier post I’ve written called “Creating A Fundraising Process.”) Put another way, it’s great and wise to “start” discussions formally with investment firms from January to about Memorial Day, and then again in September, maybe a bit into October. Outside of those windows, it’s tougher (not impossible) to start conversation with the types of firms and partners that a founder may want to engage. Again, not impossible, but much harder. Investors won’t like to admit this because they work hard (it’s true) and many have had their summers or holidays evaporate because they’re working on a deal, but it’s more often to close a deal that likely started a discussion earlier in the year. (Again, I know people will cite data about when deals happen, but that’s when they’re reported to that source. They likely closed earlier, much earlier.)
By now, we all know seed stage fundraising doesn’t happen in rounds – seed funding is a process — and it’s dragged out for many weeks, many months, and sometimes years. Founders and companies issue notes for debt which converts to equity when a round is priced by a bigger fund (most often), and those notes are usualled “capped” at some price. Likely, you’ve read about this before and/or can find more information on the intricacies of notes and capped rounds on the WWW.
I stumbled upon a lesson in raising Haystack. Because the fund is very small (like, really small) and because the LPs are mostly just individuals I know personally across the country, I can also raise the fund in a rolling model — though I can’t “split caps.” What I initially found — like a founder raising money — is that oftentimes people can wait a bit before committing to see who else comes in. No problem, but after a while, I realized it could encourage behaviors that are counterproductive.
So, instead, when someone approaches me about the fund, and there’s mutual interest, I politely mention that from the time we discuss any details, I give the person about one month to decide. It’s enough time to ask questions, poke around the web to learn about me, and to make a decision. I have now most certainly informed people after their month is up that I will happily save their name for the next fund. No harm, no foul — but I retain control and peace of mind. It sends an important signal.
Seed-stage founders could do something similar in an era of rolling closes. Instead of meeting millions of early-stage investors like me and trying to herd us like blind mice, why not put a clock on the offer? There’s so much seed funding going around, don’t worry about saying “no” to someone. It’s simple — you meet someone who inquires about your business. They dig in a little and explore. You gently suggest that your company policy is to give early-stage investors about 4 weeks from time = 0 to decide. After that, it moves on to a different “cap.” The key here is that one has to be totally comfortable with just walking away from an investor — and I’m writing this to underline the fact that oftentimes it is entirely OK to do so.
A founder I know well struggled for 8 months to just get $500k. Brutal struggle. Now, he’s in YC. When word spread, he had plenty of offers, of course. But, many of those people early didn’t invest, and he let them hang around the hoop. Now when those folks ping him, he’s quoting a higher cap. Time is money.
A friend on Twitter recently requested a blog post, and I thought it was a good idea. He wrote: “would love nuanced seed stage view on dealflow and the sharing dynamics amongst early stage firms/super angels.” Well, here you go, with the caveat I can only (1) explain what I do, as that’s what I know, and (2) generalize a bit on what I observe, though can’t say so with absolute certainty.
I try to invest at two points in a company’s cycle. One, very, very early, too early for even the microVC funds to get involved. Two, when a round has come together, and I meet the founder who has allocated some space for individuals like me, even though a firm is leading. I’m happy letting the market dictate things for now, and this gives me a good deal of latitude to write different check sizes and swing early or late depending on the specific case.
In situations where I’ve decided to invest (whether early or toward the end of the round), I’ll ask the entrepreneur if there’s room left and if I can help fill out the round. Some times, the founder will be all set; other times, they’ll say, “sure!” In those cases, I first email the LPs in Haystack, as I’ve initially committed to the company out of a joint fund, and on occasion (though it’s rare), someone will like the option to invest more directly. Then, after 24 hours, I will email a specific list I’ve created of angels, microVCs, bigVCs, family offices, and foundations that I all know personally. There are about 45-50 people on the list. The criteria for being on the list is simple — do I know the person and would I feel comfortable sending a founder to them in the event there was mutual interest in meeting. (I’ve only had to remove one person from the list.) There are also cases where syndicating on AngelList makes sense, as I’ve written about earlier.
The reason I elected to create this email list is that because I’m investing so early, there’s not much data to work off of other than the fact that I’ve vetted the opportunity in some way. So, instead, I just email the list and everyone on the list gets the email at the same time. They’re free to act on it if they choose, or simply ignore it. Very lightweight. On rare occasions, something will be very tailored to another investor I know, and in those cases, I’ll personally reach out to that investor, but I’d say that’s happened less than 10 times.
After doing this email sharing list for about a year, it’s been interesting to see some patterns emerge. Most people don’t reply, as I’m sure they’re inundated with dealflow these days. Some people habitually love to meet new founders, and some bigger VCs like to meet to build a relationship early. Some people who follow-on an investment write back to say “thank you” or give feedback, and some just move on to the next thing. A few people will share back in sort of a reciprocal way, and some won’t. I don’t have any expectations around it because, at the end of the day, I go early and direct with founders and it’s all about getting them the right investors and dollar amounts once I’ve committed.
For those who nerd out on VC happenings on Twitter, you may notice lots of “small A” rounds ($2-5m level) getting done by the same cast of syndicate microVC firms quite often. I’d gather many of them share deals based on years of working together and relationships. Companies that raise these new “small A” rounds need runway to breathe, and when you unpack how these microVC firms are capitalized and their check sizes, it makes sense they collaborate often and work together on forming rounds. I’d also imagine, however, that there’s lots of jockeying and “hey, can you make room for me?” texts and emails going on to get into deals, and if something heats up in this environment with strong signals (say, the right branded investor, getting into YC, and having something unique), that company could raise way more than they need…there’s an oversupply of money for those companies, so they have to choose and or cut down peoples’ allocations. This is part of a challenge facing microVC stage, which I’ve written about earlier.
Ultimately, I’m more of a wallflower to all of this. I’m still learning. Sometimes I time things well or move early enough, and sometimes, I’m a shade too late or just not making the cut to get into a deal. This is also why I spend time speaking and writing about what I’m interested in, with the hopes that some founders will reach out to me, even if early, to talk and brainstorm. I may miss things this way, but for now, it provides calmer waters to swim in.
A concept that’s come up often lately in conversation revolves around “running a process” in fundraising. Even though I’m a small number on the cap table for any company I work with, my #1 goal is to help the team evaluate existential risk, which usually comes down to funding risk. Eventually, some get to the point where they’re ready to go for the next investment round. It’s an exciting time, but the change in game dynamics from seed to institution is so drastic, I see lots of founders getting tripped up, wasting precious time, enduring extra mental taxes, and most tragically — losing control.
The CEO position is about control. The most successful founders I’ve seen (with respect to being efficient at fundraising from bigger institutions) run a process. They have a game plan tied to a calendar. It’s like Bill Belichick who coaches the New England Patriots. They have a start date, and an end date. They over-communicate their timelines to prospective investors (in a friendly way). They’ve already socialized things before the process even begins. They send subtle reminders. And, they’re unafraid to cut off a discussion if diligence takes too long or investors are hovering around but not digging in. Their entire body language, email language, and overall communication style oozes “I am in control.”
The cost of not creating and executing a process can be brutal. What should take a few weeks could take months — or worse, end in a bridge situation with existing investors. It’s hard to regain any deal momentum (should one be lucky to have it in the first place). It can sow doubt and worry among current team members, e.g. “Hey, do you think ___ can actually raise the next round?” It can even dampen future discussions if the company has to go back to a firm where the process wasn’t there or fell apart. Investors are implicitly looking to invest big money into who they perceive to be leaders — leaders with a plan. There’s no playbook, so the trick is to create one’s own playbook.
I’m not theorizing here. I’ve seen this happen a bunch now. There’s a pattern. This is likely one thing (not the only thing) that starts to separate the haves from the have-nots. Plan accordingly.