Unicorn Ventures
Quarterly Letter to our wonderful LLPs
First of all, we want to say a huge Thank You to each and every one of you wonderful Limited Liability Partners who’ve entrusted us with your companies’ money. As we’re all newly-minted MBAs, we know how to make that =SUM(RangeStart:RangeEnd) function really sing in Excel and let me tell you, a $750,000,000 fund is a truly beautiful thing to have custody over.
Some ignorant and petty people may claim that our 2% management fee and 20% carry on any upside we manage to eke out is excessive, but we know you understand that $15 million a year doesn’t go very far these days. Sand Hill Road rents are exorbitant and our Administrative Assistants cost us $80,000 a year each, plus benefits. This leaves barely $14 million for Partner salaries, and as there are six of us, that doesn’t go far.
But we’re not writing this to complain. We’ve each learned to scrape by on just over $2 million a year while we invest your money in sure-fire startup opportunities that will generate enormous returns. And so, without further ado, we want to present our recent investments for the last Quarter.
As you all know, here at Unicorn Ventures we only invest in companies targeting trillion-dollar-a-year revenue opportunities. As there aren’t too many of those here on Earth, this means we’ve adopted a pro-active forward-looking outward-facing investment posture and we’re putting your money where our mouths are. For each of the companies we invest in, our strategy remains clear: to keep our powder dry while putting all our wood behind the arrow and thinking outside the box while drawing clear lines in the sand.
First out of the gate is MarsNet, a startup aiming to provide gigabit Internet WiFi on Mars. As we all know, Elon will have millions of people living on Mars by next Tuesday afternoon and they’re going to want their Netflix and Disney+, especially because living in gloomy concrete underground bunkers 7/24 while drinking their own recycled urine will make everyone more than a little squirrely. As the only provider of Mars Internet services, MarsNet will be able to generate a serious hockey-stick type return. Our initial investment of $50 million has enabled crucial proof-of-concept development carried out in the company’s Tahiti headquarters under the guidance of Huey Cheetham, the company’s brilliant twelve-year-old founder. Based on our pre-money valuation of $250 million and the six-and-a-quarter minutes we spent on due diligence between vodka shots, we’re supremely confident this investment could make the fund.
Next up is Titanic Transportation, a revolutionary game-changing innovative blue-sky startup that will disrupt an entire industry and disintermediate all the existing players. The concept is simple: with climate change at the forefront of everyone’s agenda the continued pollution from oil tankers, bulk cargo carriers, container ships, and other forms of maritime transportation is now non-viable. When you factor in losses due to piracy and the fact those boats don’t exactly blast along, it’s clear that by the end of this year the world will be ready for an alternative. Titanic Transportation will bore tunnels through the Earth’s crust, linking continents through a series of vast vacuum tubes. Instead of containers from South Korea taking twelve days to reach the Port of Los Angeles, for example, the vacuum tubes will deliver the same cargo in just twelve minutes. The company estimates that the first tubes, linking Seoul to Los Angeles and New Jersey to Bristol, will require only $3.1 trillion of capital and should generate unbelivable returns by the end of next year or, at the very outside, February of the year after. We’ve placed a big bet on Titanic Transportation by investing $100 million. We looked at their Excel model showing projected income and profit margins and the cute graph they generated showing annual revenues of $27 trillion by June 2024 and we think this could be just the tip of the iceberg.
Here at Unicorn Ventures we’re not just all about making big bets on tomorrow’s most-talked-about entrepreneurs and their larger-than-life visions. As part of our fully tax-deductible Social Conscience Initiative we’re also passionate about improving ordinary people’s lives in tangible and meaningful ways. As many of you know, for the last couple of years a revolutionary new rejuvenation therapy has been emerging among Silicon Valley billionaires: blood replacement. Gnarly wrinkled old veterans of the Valley have been paying upward of $5,000 per pint for blood taken from healthy young people and we believe that this represents a potentially enormous opportunity in the mass market. We led the recent round and put $25 million into McBlood, led by the charismatic Drake Kuler. The plan is to offer millions of unemployed under-30s the chance to earn slightly more than minimum wage by coming to stay in hundreds of Blood Farms across the nation from where their daily donations will be distributed to the deserving wealthy. The company has already arranged a tie-in with Amazon, UPS, and FedEx to ensure no delivery takes longer than 240 minutes. McBlood’s marketing program will feature a lovable mid-twenties freckled all-American blood donor called Archie and the slogan “From Archie to Artery in Under Four Hours!” The company is also thinking about cutting a deal with Carly Simon to re-purpose her old hit and re-release it as “You’re So Vein.” We really feel we’re on the bleeding edge with this one.
Finally, as we ease towards year-end, we are proud to announce another investment we think is a true can’t-fail opportunity. Some of our older LLPs will remember the days when if you wanted something delivered to your home you used a mail order catalog. The lag from order to delivery was usually around two weeks. Then Amazon burst onto the scene and since then delivery times have been slashed. Amazon’s gorgeously buffed CEO has stated that the company aims to go from order to delivery in four hours. Sounds amazing, right? But we looked at this trend and we realized it signals an even greater opportunity. What if you could go from order to delivery in under two minutes? We were super pumped when Red, Inc. and Black Whole Systems both pitched us within days of each other last month because both are aiming to meet this obvious market need. We’ve put $50 million into each one, doubling our odds of success in a single stroke. Each has the same basic business model: spend an initial $1 trillion on trucks equipped with 3-D printers and enough raw materials to make absolutely anything the customer could desire. Loose-fit jeans and a pair of sneakers? Easy! Chocolate-fudge cake and bolt cutters? Literally a piece of cake! To deliver proof-of-concept each company will start off with around 50 trucks each, scaling up as the model proves itself. By ultimately having millions of these trucks circulating across the nation, no home will be more than a couple of minutes’ drive away. During the time required to get the truck to the front door, the 3-D printer will be manufacturing whatever it is the customer ordered. Although the cost of producing and delivering, say, a pair of jeans will be in the region of $104,029.53 and the sale price will be $21.99, we’re confident that as consumers react with delight and order more and more, increased volume will enable both companies to become market-leaders.
That concludes our roundup for the latest Quarter. We’re super excited about the future, we’re confident we’ve made investments that will deliver exceptional results, and we appreciate the opportunity to lead the way with investments in startups other venture firms simply don’t have the nous to appreciate.
Before we sign off, we have one last exciting piece of news: Unicorn Ventures is raising another fund! Yes, riding off the fact the current fund will undoubtedly be a success, we’re looking to raise our next fund, Unicorn Fund XIII. Our intent is to raise $2 trillion to permit follow-on funding of the companies we already have a significant stake in and increase our ownership when the opportunity arises. We hope each and every one of you will step forward, write a big check, and enable us to continue the frankly unbelievable and amazing work we’re so thrilled to be allowed to be doing.
Sincerely,
The Partners, Unicorn Ventures LLC, New Sand Hill Road, Bali
