• The founders of Kitu Life appeared on "Shark Tank" pitching Super Coffee in February 2018.
• They didn't land an offer, but they say going on the show helped them prepare for future business meetings.
• They also discovered new types of customers they hadn't anticipated.

Three years ago, the DeCicco brothers came up with the idea for Kitu Life in a college dorm room.

Jordan DeCicco was a basketball player at Philadelphia University looking for a more nutritious alternative to the energy drinks he saw on the shelves of grocery stores. He and his brothers, Jim and Jake, who had also been college athletes, devised a bottled coffee drink made with Colombian coffee, lactose-free protein, and MCT oil from coconuts.

Today, the company is valued at about $50 million and Kitu Life products — which include Super Coffee and Super Creamer — are sold in Wegmans, Whole Foods, and Fairway. Jordan has since dropped out of school, while Jim has ditched his Wall Street gig to go all in on the business.

In November, the DeCiccos were named to the Forbes 30 Under 30 list of innovators in the food and drink space.

Much of Kitu Life's success has hinged on their appearance on "Shark Tank" in February 2018 (the company was then called Sunniva Super Coffee). The founders went on the show asking for $500,000 for a 4.5% stake in their company and walked away without a deal — but Jim told Business Insider that the show was still a major boon for their entrepreneurial careers.

"The best outcome of 'Shark Tank,' despite the publicity, was how prepared we became for our business," he said.

In the month leading up to their appearance, the founders dedicated every spare second to preparing for anything and everything that could happen in the tank. They divided the 90-second pitch into three parts — one for each brother — and practiced it constantly: in the gym, in the car, in elevators.

"People would look at us like we were crazy, because we were walking down the street in here in New York City, just talking to ourselves doing this pitch," Jim said. "That's how we memorized it."

(Interestingly, the founders of Cousins Maine Lobster also said they practiced their pitch in different types of situations in order to get more comfortable with it.)

The Kitu Life founders called on investors, advisers, and even former professors to help them stage mock pitches. And once the founders had given their official "Shark Tank" pitch and gone through the Sharks' interrogation, they felt like they could handle anything.

The Kitu Life founders discovered new types of customers they hadn't anticipated

Another benefit of their "Shark Tank" experience was that it expanded their customer base: People who they'd never imagined using Super Coffee or Super Creamer were sharing their thoughts (some positive, some negative) on the products.

They'd initially marketed the product to college athletes, but Jim said they learned that "millennial moms with money"— i.e. relatively wealthy parents of young kids — had also taken a liking to Super Coffee and Super Creamer.

The Kitu Life founders aren't the only entrepreneurs to look beyond money when they think about the benefits of appearing on "Shark Tank."

Read more:People think startup founders go on 'Shark Tank' for big-name investors and a pile of cash, but entrepreneurs who have done it say that's not really the point

Randy Goldberg, cofounder of sock company Bombas, previously told Business Insider that, even though Bombas landed a $200,000 deal, preparing for the questions he might be asked was useful for future meetings.

Similarly, Jack Mann, founder of earplugs company Vibes, previously told Business Insider that even though he turned down a $100,000 offer, he discovered new uses for the earplugs. Initially, he was focused on using the product at concerts — but he learned that people were excited to use it at fitness classes and sporting events, and even on motorcycle rides. 

As for the founders of Kitu Life, Jim said, "The fact that we did it on that ['Shark Tank'] stage made every other business meeting a piece of cake, or much more comfortable than it otherwise would have been."

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• Divvy provides alternative financing options for potential home buyers who don't qualify for traditional mortgages. 
• Divvy buys homes outright and allows customers to pay it back in a series of monthly payments — 25% of which goes toward building equity and 75% goes toward paying “rent." 
• The company's COO, Adena Hefets, told us: "We want [Divvy] to be the stepping stone that allows people to transition from renting to eventually owning their own homes.”
• In October, Divvy raised a $30 million Series A round led by Andreessen Horowitz. 
• The company operates in three cities currently (Cleveland, Memphis, and Atlanta) and in its first year, helped buy homes for over 100 people. 

When Adena Hefets was growing up, her parents weren’t able to get a traditional mortgage.

Her family, however, believed in owning a home as an investment and a place to raise a family. So they found a way around the banks and received what’s called “seller financing,” where the home buyer pays the home seller in a series of payment installments.

Eventually, Hefets’ family built up enough equity in their home through the payment installments to qualify for a mortgage from the bank. With the mortgage, her parents were able to refinance their home, take out cash, and buy other rental properties.

“I was probably the only 10 year old who knew how to fix a clogged sink,” Hefets told Business Insider in a recent interview. “[It] was not a very useful skill to have then, but surprisingly useful now.”

That’s because Hefets and her co-founder Brian Ma have created a real-estate startup called Divvy, which emulates the idea of seller financing. Potential home buyers in Cleveland, Memphis, and Atlanta (the company’s first markets) who may not qualify for traditional bank mortgages can work with Divvy to receive alternative financing options and build toward owning the home.

Divvy buys homes outright and customers pay the company back in a series of monthly payments — 25% of which goes toward building equity and 75% goes toward paying “rent,” which is how Divvy makes its revenue.

Hefets explains that Divvy requires a 2% down payment from customers so that they have “some skin in the game.” Over a three-year period, customers will build toward owning 10% of the home, at which point they’ve built enough equity to apply for a mortgage.

A major pain point in the housing market

In October, Divvy raised a $30 million Series A round led by Andreessen Horowitz with participation from others like Affirm CEO Max Levchin. Hefets — who serves as the company’s COO —  tells us that in its first year, Divvy helped buy homes for over 100 people and has had over 20,000 people sign up for an application.

“We’ve found a really huge pain point in the market,” Hefets tells us. “People are really excited about finding alternative financing and are starting to gravitate towards Divvy.”

Hefets — who started her career in private equity — tells us that Divvy’s program of payment installments is a lot less risky for buyers than a traditional mortgage.

“The customers do feel like they’re owning a home and they are building up equity within in it. The difference is that we’re doing it in a more manageable way where it’s not as risky as being like, ‘Here’s an entire home and a giant mortgage,’ which is a lot of responsibility for some folks to take on,” Hefets said. “We’re not pushing [customers] to take on debt. Instead, we’re letting [them] build up equity which is nothing but wealth creation and savings.”

The San Francisco-based startup currently has 15 employees, and its COO says its official mission is getting 100,000 families their first homes.

“That’s what we’re trying to do in the next, no more than five years. We want 100,000 homes,” Hefets said. “We want that to be the first home that a family can buy and we want it to be the stepping stone that allows people to transition from renting to eventually owning their own homes.”

Still, there are plenty of challenges.  

The emotions of buying a home

As a team, one of Divvy’s core values is to “check the upstairs plumbing,” which Hefets explains to mean, “don’t ever miss anything.” That value is especially important when it comes to home inspections. In the past, Hefets and her team have decided against buying certain homes, even if a customer said it was their “dream home,” because of issues like a leaky roof or termites.

That can lead to a range of emotions from potential customers.

“It’s the largest consumer purchase that they’re ever going to make in their lives, so it’s super emotional,” Hefets explains. “Which means what we’re doing is more exciting, but probably harder than what I had given it credit for.”

For every hard conversation though, there are plenty of positive ones. Hefets tell us of a conversation she recently had with a customer who just had his home approved.

“I got on the phone with one of our customers who’s typically a very serious guy. We’re on the phone and it’s like, ‘Yes, ma’am. No, ma’am. I agree. I don’t agree.’ Super formal,” Hefets explains. “At the end of the call he said, ‘Miss Adena, I want you to know that my mom tells me I don’t tell people enough how I’m feeling. And I want you to know: I am so excited!”

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• There's a lot in common between working at a restaurant and running a business, said Setter cofounder David Steckel, who's done both.
• Both roles require workers to negotiate between several parties and anticipate problems to best serve the customer, Steckel said.
• He still uses the skills he learned from waiting tables in college in the home maintenance-management business he founded.

There's a surprising amount in common between working at a restaurant and running a construction project.

David Steckel would know. He went from waiting tables in college to founding Setter, a company that manages home maintenance projects. The startup announced a $10 million Series A, led by Sequoia Capital and NFX, in November.

Steckel told Business Insider that he gained many of the skills he uses today from that early restaurant gig — the most important one being how to negotiate between customers, clients, and employees.

"If you actually think about the structure of a restaurant, you have a very similar environment to a marketplace," Steckel told Business Insider. "The language you use with a customer is very different than the language you use in back-of-house with the kitchen staff."

"In front-of-house, the lights are warm and low, in the back they're fluorescent and bright," he said. "You get back into the kitchen and you have to negotiate with the kitchen on behalf of your customer. Then you also have the bartenders who are busy trying to serve all the other waiters, so you have to negotiate with them to make sure your customers are getting what they need."

Read more:Here's what it takes to make $100,000 a year as a waiter in NYC

That constant push and pull is similar to what Steckel said he faces at Setter. The Toronto-based company, founded in 2015, pairs customers with "home managers" to take charge of their home maintenance and repair projects. Whenever the customer needs their plumbing fixed, their walls painted, or their yard landscaped, for example, Setter contacts vendors and contractors, negotiates a rate, and arranges the appointment.

That's a lot of moving parts.

"You're kind of changing gears with your language, your ability to negotiate, and you're using all your skills at the same time," Steckel said.

Of course, restaurant patrons are usually less anxious than a homeowner in need of a new countertop. Home maintenance is naturally stress-inducing for most people, Steckel said, while diners typically don't get upset unless something goes wrong.

But regardless of the situation, a good worker puts their customers' fear at ease by anticipating problems and taking action to correct them, Steckel said.

"No matter how good your restaurant is, at some point the food is going to be cold or it's going to be late," he told Business Insider. "You don't just go to a table to your customer and say the food's late. You say, hey, here's something to snack on, the kitchen is a little behind, and I'm going to offer a solution."

Steckel learned from his restaurant gig that if you're proactive about fixing a problem, customers will remember how you helped them more than they'll remember the problem itself. That leads to them having a better experience and being more likely to come back.

"If you have the ability to take a deficiency and turn it into an opportunity to add value to the customer's life, we've found their loyalty," he said.

"So in effect, when something goes wrong, it's an opportunity to have a better relationship."

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• When a founding CEO sells their company, they might be thrilled from a financial and emotional perspective, or ... not.
• There are a few different outcomes for CEOs after an acquisition: They might leave to start a new company, stay on in the same role, or stay on and take a new role within the combined company.
• Research suggests taking on a new role within the combined company is the most productive,  but the least common.
• For founding CEOs in the acquisition process, it's important to set expectations beforehand — or risk running into conflict down the road.

"You'd think we would've been celebrating," said Marc Lore. "Like, 'Wow, we just made enough money that we never have to work again.'"

Lore is the CEO and president of Walmart eCommerce in the US. In an interview with Business Insider's Alyson Shontell, he remembered the moment he sold his first big startup, Quidsi, which sold diapers, to Amazon for $550 million in 2011.

But "it wasn't a celebration," Lore said. "It was sort of like mourning."

In retrospect, Lore said, he realized that the money he and his team made from the sale wasn't enough to compensate for the seeming loss of purpose. He told Shontell:

"I think a lot of entrepreneurship is about … having fun building something, being empowered to make decisions and run, build your own unique culture, hire the people you want to hire, watch them grow and develop, and go on to bigger and better things, and learn while they're there."

After the sale to Amazon, he said, it occurred to the Quidsi team that, "Hey, in this new structure, this new world, a lot of the things that made us happy are not going to exist anymore."

For many CEOs, especially founding CEOs, selling their company can bring up ambivalent feelings — not solely about whether it was the right move financially or logistically, but also about what it means for their personal careers. Others see the decision as tough, even if it was the right call.

The best — and least common — outcome for a CEO may be to take on a new role within the combined organization

The fate of a CEO post-acquisition depends not only on what they want, but also on how the acquiring firm sees them.

If the acquiring firm perceives the CEO as critical to their success, they might try to lock them down with "golden handcuffs," Noam Wasserman, founding director of the University of Southern California's Founder Central Initiative, told me. For example, the CEO and the acquiring firm might negotiate an earn-out agreement, meaning that the CEO would be compensated for hitting certain performance targets.

In other cases, Wasserman said, the acquiring firm might ask the CEO to sign a non-compete agreement, preventing them from starting a similar business, at least for a few years.

It's hard to find exact statistics on what happens to CEOs once they sell their companies. But Donald Hambrick, a professor of management and organization at Pennsylvania State University's Smeal College of Business, estimated that 40% stay on as the head of the acquired unit; 40% agree to leave within the first six months of the acquisition; and 20% take on another executive position in the acquiring firm.

While that third option is the least common, research suggests it can be the most productive.

Melissa Graebner, an associate professor of management at the University of Texas at Austin's McCombs School of Business, pointed me to a 2004 paper she published in the Strategic Management Journal, for which she interviewed the CEOs of multiple IT businesses that had been acquired.

Graebner found that "serendipitous value"— positive developments that the buyer didn't anticipate before the deal, such as new product development techniques — happened most often when the CEO took a cross-organizational role (i.e. a role in the new, combined company).

Graebner said that, although there are exceptions, when a CEO doesn't take on that cross-organizational role, "it's usually a missed opportunity."

Lore took that opportunity when he sold his second startup, Jet.com, to Walmart in 2016 for $3 billion and stock: He became the CEO of Walmart eCommerce in the US.

Lore told Business Insider's Shontell that when he and Doug McMillion, the CEO of Walmart, started talking about working together, "The one piece was I didn't want to go down this path that we did last time, which was, 'Hey, we're going to let you do your thing.' Because I learned that lesson before. And Doug said, 'No, we actually want to give you the keys, and have you, your team, take the best of both worlds and drive this thing forward.'"

Some founding CEOs are just itching to start another company after they sell one

Many founder CEOs who sell their company are serial entrepreneurs, and wind up launching another successful business shortly after the acquisition.

Read more: 'Entrepreneurship porn' lures young people with a pretty picture of startup life, but it glosses over the most dangerous parts

In 2013, Bryan Goldberg sold Bleacher Report to Turner Media (owner of CNN) for roughly $200 million. "When the money hit the bank account, I was just relieved that this grueling eight-month process was over," Goldberg previously told Business Insider's Shontell. "Then you realize, I don't own this [startup] anymore, which is a very powerful feeling."

Goldberg went on to launch Bustle in 2013, which has raised $12 million, according to Crunchbase.

Ben Horowitz, meanwhile, told The New York Times that he had "total seller's remorse" after selling Opsware to Hewlett-Packard in 2007, for $1.6 billion. "I spent eight years, all day every day, trying to build this thing, and all of a sudden it's gone, it's just over," he said. "It's a little bit like something dies," he told The Times.

Horowitz subsequently cofounded Andreeseen-Horowitz with Marc Andreesen; it's now one of the most influential venture-capital firms in Silicon Valley.

And Jyoti Bansal sold his startup AppDynamics to Cisco for $3.7 billion in 2017. He made the decision just days before the company had planned to IPO, Business Insider's Zoë Bernard reported.

In the months following the sale, Bansal pondered what to do with himself. (He'd stepped down as AppDynamics CEO several years earlier, though at the time he was still chairman.) "I started with trying to retire," he told me, but "that didn't work for me. I got bored after a few months."

Since selling AppDynamics, Bansal has gone on to launch several other businesses, including a venture-capital firm. He realized that, like many entrepreneurs, he liked "the thrill of building companies" and "going through that hustle and struggle." Plus, he wanted to help newer entrepreneurs bring their ideas to fruition.

Bansal said that, at this point, he's not really involved in decision-making at AppDynamics.

Other founding CEOs can't imagine leaving their baby in someone else's hands

Marla Beck had a starkly different acquisition experience. In 2015, Beck sold Bluemercury, the company she'd cofounded with her husband, to Macy's for $210 million.

Bluemercury and Macy's agreed that Beck would stay on as CEO. Beck said that was a no-brainer for her, describing BlueMercury as her "first child." (She now has three human children.)

The decision to sell wasn't so difficult either, Beck said. She and her husband, Barry Beck, had been entertaining the idea and looking for a potential partner to help them scale the business.

When she finally signed her company over to Macy's, Beck said, "it was pretty much validation that our idea was right," after hearing over and over again that it wouldn't work. (Bluemercury started as an e-commerce beauty company.) It showed her "after all of the blood, sweat, and tears that went into the 19 years along with our team, that we had the right vision and we were being recognized for it."

It's crucial for founding CEOs and leaders at the acquiring firm to set expectations in advance

New entrepreneurs often call Beck for advice, especially around acquisitions. She always gives them the same piece of wisdom: Make sure to set expectations together with your new parent company.

Read more: The best advice for entrepreneurs, from 16 real people who started their own companies

Beck recommends getting into the nitty-gritty as much as possible. For example, she said, you should decide how often you're going to meet with leadership at your parent company: Weekly? Monthly? Quarterly?

If you meet once a month, for example, you'll spend several days preparing for the meeting, Beck said, "which takes your focus off the business."

Beck wanted to stay focused on growth, and didn't want to be distracted by having to prepare for a weekly or monthly meeting with Macy's. "It was really important for me to have the mind space to continue to be a creator as well as a CEO scaling a company," she said.

Recent examples of startup founders leaving their parent companies after high-profile acquisitions may serve as a warning for entrepreneurs considering selling.

In September, six years after selling to Facebook, the founders of Instagram, Kevin Systrom and Mike Krieger, left Facebook. As Business Insider's Sean Wolfe reported, it was rumored that their departure resulted from conflict with Facebook executive over what Instagram should be — and whether Instagram was competing with Facebook's user base.

Brian Acton, a cofounder of WhatsApp, which was acquired by Facebook in 2014, also left the company recently. As Business Insider's Shona Ghosh reported, there was tension over Facebook's desire to place ads on WhatsApp, and whether that meant Acton could leave and take his full allocation of stock.

When deciding whether to sell, entrepreneurs should consider how they'd handle the worst-case scenario

Oftentimes, there's no easy way to decide whether to sell your company. Wasserman suggested that, in order to minimize regret, founding CEOs should consider how they would handle the worst-case scenario in addition to the best-case — for example, if they no longer had any substantive say about the company's major decisions.

Wasserman also recommended considering the "competitive landscape," as in whether remaining small and independent will help or hurt them in the long run.

As for Bansal, he remembers when he realized that he'd do well either way (selling or going public), but his employees would fare better financially if he sold AppDynamics to Cisco. That was what ultimately pushed him to sell the company, and Bansal said that more than 400 people made more than $1 million.

Recently, one of Bansal's former AppDynamics employees texted him to say "thanks." He'd just bought a new house using the money he made from the AppDynamics acquisition.

Bansal said, "It's life-changing for a lot of people."

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• Token, a New York-based startup that offers "gifting" services for businesses, is attempting to re-envision the corporate gifting industry by providing tasteful, hand-wrapped gifts.
• Token founder Jonathan Jarvis says that companies should look at gift giving as an opportunity to build a relationship with their customers.

It's no secret that the industry known as corporate gifting — the exchange of gifts between a business and its clients — is known for producing an array of often less than desirable gifts. Among the more objectionable offerings are items like bottles of wine prominently embossed with company branding, wicker baskets filled with unappealingly packaged foods, and, of course, the dreaded fruitcake.

One scrappy New York startup is taking on the multi-billion dollar corporate gifting industry by executing what may at first seem like the impossible: selecting, wrapping, and delivering hundreds of gifts at a time, in a way that makes each item appear to be hand-selected by the gift-giver themself.

The company, called Token, (like a token of appreciation, not the crypto kind of token, its founder Jonathan Jarvis is quick to point out) is re-envisioning gift-giving through a process that provides tasteful, hand-wrapped gifts. Inside Token's airy, Williamsburg office, employees write personalized notes in pen (these are often handwritten by Jarvis himself) and stamp individual envelopes with the company's signature red wax seals. 

When Jarvis first launched Token two years ago, he planned on helping both individuals and businesses better select bespoke, thoughtful gifts. But now, Jarvis says that the overwhelming majority of Token's business comes from its corporate offerings, an aspect that he hopes to augment in upcoming years.

"When we started, we saw a lot of 'professional gifting' — for instance, a real estate agent sending a gift to a client, or a colleague sending a congratulations gift to someone who had recently been promoted," said Jarvis. "But then we started getting more requests: entire companies that wanted to offer a way to send out holiday gifts. That’s when we got really interested in the idea of building a system so that we could be notified every time a company wanted to send out a new gift." 

Token's services are particularly in demand among tech companies, says Jarvis, with both Google and Salesforce among the startup's bigger clients.

"Tech companies are interested in trying out a new approach to gift-giving," said Jarvis. "We're trying to bring the convenience of digital outreach to an IRL experience. In the future, people will be able to send packages as easily as they'd be able to send a thoughtful, personalized text message."

When re-thinking the gift-giving process, Jarvis and his team decided to start from scratch. After all, there's plenty to be improved upon, says Jarvis.

"Corporate gifts are often the worst gifts you're given," said Jarvis."Think about all the money that goes into corporate gifting, and how seldom it pleases the recipient. It's a missed opportunity to further the experience of your brand, and it's hugely inefficient."

Notably, Token's approach runs short on actual branding. ("Nobody actually likes receiving branded stuff," Jarvis points out.) Instead, Jarvis, a former Google creative director, tailors Token's gifts to an audience that he describes as "sophisticated and design-focused." Among Token's offerings are items like gold-plated cheese knives, marble-topped whiskey decanters, geometrical plant holders, and champagne truffles. 

Jarvis says that Token will only grow in upcoming years, as more companies look for opportunities to connect with their customers in tangible ways. 

"Giving a gift is like an act of service, as well as a physical token," said Jarvis. "Gifting done bad looks like a bribe. If you approach business with a lot of generosity, you accrue credit with people. In general, if you do that, people will remember and repay your original gift with interest."

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• Most of us try to avoid tough conversations, but the most successful people tackle awkward subjects head on.
• A professor who studied 20,000 startup founders said "going ugly" and addressing uncomfortable issues can help you both in the business world and in romantic relationships.
• From planning for the departure of a company's cofounder to drawing up a prenuptial agreement, "going ugly" tends to benefit all parties in the long run.

It's human nature to want to avoid tough conversations.

But the most successful people know that skirting around uncomfortable subjects just makes things worse in the long run.

That's what Noam Wasserman, a professor of clinical entrepreneurship at the University of Southern California, discovered after almost 20 years of studying 20,000 startup founders.

Wasserman wrote about the lessons he learned from his research in The Wall Street Journal on Sunday, and he said they apply to both business and life itself.

The professor wrote that the best startup founders he studied had a tendency to approach tough discussions head on — "going ugly," as he calls it.

"In a hypercompetitive environment, there is little wiggle room for balky products or ineffective team members," Wasserman wrote for The Journal. "As a result, the best founders move quickly to identify and deal with any problem areas they see, despite the natural inclination to avoid tension-filled issues."

Read more:How to successfully have a difficult conversation with your boss

In one case he studied, two of the three cofounders of a software startup had doubts that the third founder would remain with the company. The third founder had just become a father, and they suspected he might take his ownership stake in the startup and leave for a more stable job, leaving the company unable to attract a good replacement.

To cover their bases, the founders "went ugly" and drafted a plan about what would happen in such a scenario.

"It was a tough conversation, but it paid off," Wasserman wrote. "When the new father decided that he couldn't found a venture while founding a family, the company had a deal ready to go. The co-founders reclaimed his ownership stake, used his shares to lure a replacement executive and, down the road, attracted a buyer."

But "going ugly" is more than just good business advice — it can help in personal relationships, too.

Wasserman said one of his students had a habit of "going ugly" on first dates, refusing to tiptoe around awkward topics like income prospects and where he wants to live.

Prenuptial agreements are another example of how "going ugly" can benefit both parties in a relationship.

"Just as in the entrepreneurial world, agreements like these can strengthen relationships by surfacing issues early, revealing people's true intentions and motivations and clarifying expectations while adjustments can still be made easily," Wasserman said.

Read the full Wall Street Journal article here »

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• The public markets have taken a beating in recent weeks, and some investors are comparing the plunge to the early days of the dot-com bust.
• Alex Niehenke, a partner at Scale Venture Partners, explains how a downturn in the public markets can affect the venture-capital industry.
• Much of this trickle-down effect is psychological, Niehenke says, and can inspire both general and limited partners to make more conservative bets.

The public markets have taken a beating in recent weeks, and some investors are comparing the plunge to early days of the dot-com bust.

In a recent interview with Business Insider, Alex Niehenke, a partner at enterprise-focused venture fund Scale Venture Partners — which made early bets on companies like Docusign, Box, and Hubspot — broke down the "psychology-driven" effect that a plunge in the public markets can play on venture capital.

In short, he says, a downturn in the markets means investors are more scared to place big bets on startups, because there's less assurance that you'll get a strong return on your investment.

Here's a passage from that interview, edited and condensed for clarity, quoted from Niehenke:

"If you think about the value proposition of venture, it's fundamentally borderline ludicrous ... The business of venture is all based on near-term belief. Any time this belief becomes a question mark, or an insecurity, it can be troubling.

"Let’s put you in the seat of a general partner. If you're a pretty successful general partner at a standard fund, you're maybe on the board of five or six companies. A third are hopefully knock-out-of-the-park good, a third are in the middle, and another third are going to have some trouble. When things are in a positive environment, your top performers will take care of themselves, the middle third might need a little help along the way, and the bottom third will require more work.

"You can generally manage this bottom third in two outcomes: When the market turns (for instance, I'm thinking back to 2009 here), the bottom third of companies are unfinanceable. No one will touch them. And then, the middle third will have trouble finding financing. So that’s two-thirds of your portfolio. Then you start focusing on the top third of your portfolio, which are performing really well.

"But by then, everyone starts worrying. It's a terrible metaphor but, when your house is burning, you're not thinking about how to build out your deck because you're too concerned with putting out the fire.

"Everyone starts worrying, and the belief becomes the reality. This often starts with the limited partners who manage large positions. They start seeing a certain amount of their wealth decrease from the public markets, and seeing their market cap decrease overall, which drives more conservative behavior.

"This business is so psychology-driven. In 2009, if you were trying to raise a venture fund, it was incredibly difficult. Everyone with money had problems. People weren’t talking about how to grow a business, they were trying to survive the economy. If you do decide to raise that capital, you become more cautious and thoughtful in your capital deployment. Venture operates in 10-year fund cycles.

"Psychology really matters in this industry because so much of venture is based on believing.

"So, this goes back to entrepreneurs. If I’m going to a set of investors and saying, 'Hey, I think that the taxi industry is backwards and that should change,' then I have to postulate that I should change it. ... Still, many entrepreneurs start companies during downturns because there's a definite reason to change the status quo.

"I've been very excited about the M&A markets this year. Acquirers have such large balance sheets, and there's been a string of fantastic M&A deals. I think this is healthy for the ecosystem and something that we anticipated and hoped for.

"But if we see a 15 to 20% slide in the public markets, you'll see less that this tends to be the behavior among acquirers, and this would be a shame for the venture industry.

"M&A can drive good venture returns, it's a great way for investors to clear out our portfolios. What inevitably happens when that goes away is that one of our options to see a realization for returns disappears. I'd like to say that at Scale all of our companies will go public, but that's just not true. You need the ability to exit for a good return.

"If you can't execute on returns, then at some point, LPs stop giving you money. You have to have reality checks when these markets change."

Join the conversation about this story »

NOW WATCH: Review: Google Pixel 3 and 3 XL are the best smartphones you can buy right now

• If you've never failed before, you won't get a job at the home-maintenance startup Setter.
• That's a rule developed by Setter cofounder David Steckel, who said if a job candidate hasn't made any professional mistakes, it's a red flag.
• Steckel drew the rule from his personal experience founding the company, and said he is looking for people who can talk candidly about their failures and mistakes and learn something from them.

During a job interview, you're expected to show off your best self.

But if you come off as a little too perfect, that's a turnoff for some employers.

In fact, one startup founder has a rule to weed out job candidates who seem a little too good to be true: If you've never failed, you're not getting the job.

"If I'm interviewing someone and they tell me they’ve gotten everything right in life, that's a red flag right there," David Steckel, the founder of the home-maintenance company Setter, wrote on LinkedIn. "Because it means they’ve never gone out of their comfort zone. Never pushed themselves to the edge and beyond. Never faced an obstacle larger than their skill set."

Steckel said he drew his rule from his own experience as an entrepreneur. He cofounded Setter in 2015 as a way to help customers manage all their home-maintenance projects in one place.

This month, the Toronto-based company announced it raised $10 million in Series A funding. But the first iteration of the company, Steckel told Business Insider, was a failure that cost him $100,000. His problem was trying to do too much by himself, which led him to enlist cofounder and CEO Guillaume Laliberte.

Read more:9 puzzling interview questions from real execs that seem to have nothing to do with the job

Now, Steckel can relate to job applicants who can talk candidly about mistakes they've made in their careers.

"The type of person that I'm looking for in any role at Setter is comfortable talking about experience where a project has backfired, utterly failed, the outcome was the opposite of what was desired, or if they've just made a mistake that negatively affected a deal, customer, or opportunity," he told Business Insider.

As for the type of person they're not looking for? Steckel recalls one example that stands out.

His team was interviewing a potential hire and was asking him about times something went wrong on the job. The applicant's answers, to Steckel's disappointment, shifted the blame to his coworkers and supervisors.

"He never once used an example with 'I' as the subject that made a mistake," Steckel told Business Insider.

"This interviewee clearly believed that they never did anything wrong in their life. The ability to be humble is part of our culture, and this candidate was very focused on laying blame rather than learning."

The critical element is learning from your mistakes and being honest about them, he added.

"If you've played video games, you know you can never beat the boss on the first try. It might take 10, 50 or even 100 attempts," he wrote on LinkedIn. "What I’m looking for are the people who keep trying."

• Read more:
• 9 puzzling interview questions from real execs that seem to have nothing to do with the job
• A tech CEO asks job candidates about the qualities they like least and most in their parents — and he says the answers are hugely revealing
• Jeff Bezos once said that in job interviews he told candidates of 3 ways to work — and that you have to do all 3 at Amazon
• Former Googlers who run their own tech startup ask candidates 3 questions that seem to have nothing to do with the job

SEE ALSO: The classic advice to dress for the job you want has a major flaw, and it could make a job interview that much harder

DON'T MISS: An entrepreneur who waited tables in college took away business lessons that made all the difference in his startup

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• Relationship Hero is an on-demand coaching service that provides customers with dating and relationship advice.
• Users can call, text, or chat one of the company's 70-full time coaches at any time of day.
• On Friday, the company announced it raised a $2 million seed round led by Foundation Capital, Village Global, and Shrug Capital.

When Liron Shapira was in his 20s, he relied on dating advice from one of his best friends. He really needed help with online dating.

"I would be looking at the blank wall, thinking like, 'I have nothing to say. How could I possibly say anything interesting?'" Shapira remembers.

His friend would explain to him "there's actually a way to have a natural, funny conversation inside online dating." 

Shapira and his friend, Lior Gotesman, realized there were probably plenty of people out there who needed similar help — whether it was getting over the anxieties of dating or working through issues in existing relationships. 

The entrepreneurs launched Relationship Hero two years ago to do just that — provide on-demand coaching for anyone looking for dating or relationship advice. The Y Combinator-backed startup now has 70 full-time relationship coaches on staff and on Friday, announced it raised a $2 million seed round led by Foundation Capital, Village Global, and Shrug Capital. 

"We're one of those companies that is finding a market that was hiding in plain sight," Shapira told Business Insider in a recent interview. "We're all going to our friends for relationship advice, but where is the equivalent company for that?" 

Don't call it therapy

So what does a relationship coach actually do?

The coaches help customers with a mix of dating and relationship advice — from sending an opening one-liner on Tinder to composing a heartfelt email to an ex. Customers range from 18 to 70-years-old and its demographic is split almost exactly even between females and males, according to Shapira.

Users can call, text, or chat a Relationship Hero coach at any time of the day and expect an immediate response. Fees for coaching vary, but the average rate is around $90 per hour. 

Coaches all must go through the same intensive training program, but not all have a background in psychology. One coach, for example, was a former accountant.

There's been some pushback by professional therapists who say people should be going to them for relationship advice, Shapira acknowledges. But he doesn't think traditional therapy is the answer. 

"If you go to a therapist, they're going to have you focus on yourself — focus internally on your emotions, your own mental state," he says. "And the problem is that relationships are actually very external. It's all about getting the results you want with your partner and with the outside world. And it's a totally different skillset." 

Working at Relationship Hero 

There are 75 employees at Relationship Hero, and 70 of them are coaches. 

"We're basically a team of coaches, with a little bit of overhead," Shapira explains. He says with the company's 20% month-over-month growth, it's continually adding new coaches to its team. 

Interestingly, these coaches are full-time employees of Relationship Hero, rather than contractors. 

"It's not a marketplace. We're helping invent and ensure the quality of the coaching so we have to own that," Shapira says. "The people who work for us, they're really not independent contractors. We're really strict how they go about the coaching." 

When it comes to where and when employees work however, Relationship Hero is very flexible.  The company is entirely remote. Coaches live across the US and have flexible schedules which helps the company provide customers with coverage throughout the day. 

"It's really hard for people to find quality jobs in middle-America and places where the local economy isn't doing that great. We're offering people a job that's full time, guaranteed, with a steady stream of clients," Shapira tells us. "They also love the work because they get to help people. They can see that they're putting families back together." 

As for Shapira, he'll be putting the remote work model to the test next month when he leaves Silicon Valley and moves to upstate New York with his wife. 

Shapira met his wife on Tinder three years ago, and thanks to the coaching of his friend and Relationship Hero co-founder, he was able to land a date. 

"I met my wife on Tinder all thanks to Lior's help!" Shapira explained. "Afterwards she told me she always flakes on guys, but somehow I convinced her to go on a date. It was a high stakes situation and the coaching was life changing." 

SEE ALSO: 'We have screwed up': Uber CEO Dara Khosrowshahi says in an all-hands meeting that the company deserves some fault after its self-driving car killed a pedestria

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• Jason Brown, cofounder and CEO of personal-finance app Tally, asks every potential hire, "As a human, are you happy?"
• It's Brown's way of finding out if the applicant is aligned with Tally's mission and has personal motivations for wanting to work there.
• Applicants who can pinpoint the things that drive their happiness tend to also have better reasons for wanting to work at the company, Brown said.

A company runs smoother when all of its employees are aligned with its mission.

For Jason Brown, the cofounder and CEO of personal-finance app Tally, that means determining at the interview stage where a potential hire's priorities lie.

And Brown has a unusual way of finding that out. Whenever someone interviews for a job at Tally, he makes sure he asks them if they're happy.

"One question I ask people is, 'As a human, are you happy?'" Brown told Business Insider.

The point of the question, Brown said, isn't to assess an applicant's mental health or emotional state, but to see if they can put into words the things that drive them. Someone who cites a recent vacation or hanging out with friends, for example, is less likely to get the job than someone who talks insightfully about personal relationships and health.

"It really is very telling of people who understand what makes them happy and who have self-awareness about deeper things driving happiness, versus more shallow things," he said.

"It's not so much the answer," he added, so much as it's "a) have you ever thought about this, and b) do you have at least some foggy notion about the rough elements that matter to you?"

Related:A startup founder who's raised $10 million has a rule to weed out job candidates who seem a little too good to be true

Founded in 2015, Tally helps users lower their credit-card debt by consolidating their debt from multiple cards, paying off the debt, and then charging them a lower interest rate. The San Francisco-based company raised $25 million in Series B funding earlier this year, and has grown from about 20 employees to 60 in 2018.

Inevitably, the Tally applicants who can pinpoint what makes them happy are the ones who have more personal motivations for wanting to work there. For example, some Tally employees had their own struggles with credit-card debt, Brown said. 

Asking them about their happiness tends to make those motivations more clear.

"At that point, I'm like, OK, cool, there's somebody who really does genuinely believe in making people less stressed and better off financially," Brown said.

Hiring people who believe in Tally's mission is the "most important thing" for the company, Brown said.

"If you have everybody on your team who has a personal, deeper reason to be there, I think that's where the next level of ideas come out," he told Business Insider. "Instead of them being done at the end of the day, they're thinking about, 'how can we make this better?'"

• Read more:
• A startup founder who's raised $10 million has a rule to weed out job candidates who seem a little too good to be true
• 9 puzzling interview questions from real execs that seem to have nothing to do with the job
• Former Googlers who run their own tech startup ask candidates 3 questions that seem to have nothing to do with the job

Join the conversation about this story »

NOW WATCH: The 3 key words to use on your résumé to land the interview

• At Business Insider's Ignition conference, Dropbox CEO Drew Houston explained the one thing that's even worse than a failing startup: a "zombie startup."
• A zombie startup is a company that's neither "succeeding nor dying."
• Houston said focusing on growth is the best way to avoid "zombie mode."

Turns out, there might be one thing even worse than a startup that's failing: a "zombie startup."

In a conversation with Business Insider's editor-in-chief, Alyson Shontell, and Y Combinator's Paul Graham at Business Insider's Ignition conference in New York on Monday, Dropbox CEO Drew Houston described how having a "zombie startup" can sometimes be even worse than heading up a company that's failing. 

"I felt like in my first company which I bootstrapped, it's very easy to get into this 'zombie mode,' where your startup is neither truly succeeding nor dying," Houston said. "This is actually worse than failing."

Read more:The rise of Dropbox CEO Drew Houston, who just made the Forbes 400 after taking his company public

For many startups, growth is often one of the surest metrics of measuring a company's success early on, and Houston said that one way to avoid "zombie mode" is to keep that focus on growth, even as the company scales.

"You can't fake growth," Houston said. "[Growth] is just a measure of: do you have customers? Are they happy?"

You can watch the full conversation here: 

Ignition is Business Insider's flagship conference featuring the biggest names in business, tech, and media. You can check out the agenda and who to expect right here. 

SEE ALSO: Buzzy software company Carta is raising funding at an $800 million valuation

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• At Business Insider's Ignition conference, AOL founder Steve Case explained why he's bullish on the Midwest.
• Case recently launched a $150 million "Rise of the Rest" fund to spur innovation in cities beyond tech hubs like Silicon Valley and New York.
• Case compared his bets on Midwestern companies to his belief in the internet in the early '80s.

AOL founder Steve Case is making bold bets on companies from the Midwest.

In a conversation with Business Insider reporter Richard Feloni at Business Insider's Ignition conference in New York on Monday, Case explained why he's so bullish on funding startups outside of Silicon Valley, and compared it to the prescient bet he made on the internet in the early '80s. 

"When I believed in the idea of the internet — even though for a decade it was a struggle and we almost didn’t make it, I [still] believed in the idea of the internet — I similarly believe in the idea of the 'rise of the rest,'" said Case.

Read more:Billionaire investor Steve Case says the failure of the 2000 AOL Time Warner mega merger taught him a crucial lesson about execution

Case is the founder of venture capital firm Revolution, which recently launched a $150 million fund centered on spurring innovation in cities beyond tech hubs like Silicon Valley and New York.

While Case said he doesn't think those major tech hubs are going anywhere, he predicts there will be new cities that will be "surprising us." 

"I can’t predict exactly how long it will take; I can’t predict exactly which cities will rise faster; I can’t predict which entrepreneurs will have the breakout successes — the iconic, multi-billion dollar companies of the future," Case said. 

"But I'm pretty confident over the next decade, people will be surprised that while San Francisco, New York, and Boston will continue to be strong, there will be many other cities, including maybe where you grew up ... including maybe where you went to school, that will be rising up and surprising us."

You can watch the full conversation here: 

Ignition is Business Insider's flagship conference featuring the biggest names in business, tech, and media. You can check out the agenda and who to expect right here. 

SEE ALSO: The CEO of Dropbox explains the one thing that's worse than having your startup fail: becoming a 'zombie startup'

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The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.

Ten seasons in and hundreds of products later, the show "Shark Tank" continues to entertain us as well as the panel of celebrity investors with creative pitches. However, that doesn't always mean the products are actually good. Some end up being a little too creative or out-there and border on plain gimmicky or "Who would even use that?"

We looked through all the "Shark Tank" products available for purchase and came away with a selection of star products for the home that made us curse and ask ourselves, "Why didn't we think of this earlier?"

Many solve for the wasteful design of many common products you already use, while others address the annoying inconveniences that everyone experiences. 

Check out the "Shark Tank" home products that are worth buying below.

SEE ALSO: The 20 best gifts that got their start on ‘Shark Tank’

A spring-loaded laundry hamper

This hamper drops down as you add clothes and rises as you remove them, meaning doing laundry will no longer be that uncomfortable chore you never look forward to. It eases the strain on your lower back, so it's especially great for expecting mothers, people with bad backs, and the elderly. 

Household Essentials Lifter Hamper, $29.99, available at Amazon

A self-cleaning dog potty

If you've already tried many indoor potty training systems, your search ends here with the world's first self-cleaning dog potty. You can adjust the timer to automatically change a dirty pad one, two, or three times a day, or manually change it with a push of a button. The machine will wrap and seal the waste, keeping your home clean and odor-free. It's best for dogs under 25 pounds. 

BrilliantPad Self-Cleaning & Automatic Indoor Dog Potty + 1 Roll, $129.99, available at Amazon

A rapid ramen cooker

Granted ramen is already a pretty convenient meal to make, this tool makes the process even easier. The water line stops you from overfilling the bowl, the bowl doesn't get overly hot, and you don't need to use a pot and stove. It's perfect for anyone who doesn't have access to a kitchen, including students living in dorms and office workers. 

Rapid Ramen Cooker (Red), $6.99, available at Amazon

• Entrepreneur Jason Brown wants people to think of his personal-finance app Tally like a washing machine
• Most people don't think about how much time and stress washing machines save them.
• Brown's endgame is for Tally is "a world where all of your financial decisions and financial work will be done invisibly."

If entrepreneur Jason Brown had his way, people would think of his technology like they do washing machines. 

That is to say, they would barely think of it at all.

Brown is the cofounder and CEO of Tally, a personal-finance app that uses an innovative method to reduce credit-card debt. Founded in 2015, Tally consolidates the debt customers accrue over multiple credit cards, pays off the debt, and then charges customers a lower interest rate than they initially had. The San Francisco-based company raised $25 million earlier this year and has raised $42 million overall.

So what does any of that have to do with washing machines?

"A lot of the truly transformative technologies end up being so taken for granted that they're not even seen anymore," Brown told Business Insider.

Before the electric washing machine, Brown said, American families spent nearly 500 hours a year washing their clothes and linens by hand. When the machines became widely available in the early 1900s, that figure shrank to one or two hours a week.

That gave people more time to spend with their families, work, study, or do anything else that enriched their lives in a way manual chores didn't.

"Suddenly, this functional load that we had was completely taken off of us, and regular people had what rich people already had, which, they had people they paid to do that for them," Brown said at the Fintech Inclusion Summit in October. "But now it was available at a low cost for everybody."

Today, the washing machine is so ubiquitous that it would be hard to imagine life without it.

And Brown envisions the same future for Tally.

"Right now, the idea that somebody else is making your financial decisions and moving your money around sounds pretty crazy and out there," Brown told Business Insider. "But in 10 or 15 years we won't even realize that that's happening, because it's just like, 'Oh yeah, I have my Tally, and I ask it questions, it tells me things, but otherwise it's just churning every single day and makes me better off.'"

"It will be so present, we won’t even know it exists," he said. "We will have a world where all of your financial decisions and financial work will be done invisibly."

Read more:Tally CEO Jason Brown asks every potential hire the same question, and it has nothing to do with work

Brown also has personal reasons for founding Tally. Growing up, he said, money was a source of anxiety for his family that prevented his parents from being "fully present" at times.

On a larger scale, American credit-card debt recently hit an all-time high, surpassing the $1 trillion mark in August, while the average American household is more than $5,000 in debt. Studies show that debt contributes to stress and depression.

By having Tally consolidate and reduce people's credit-card debt, it can free up time, and more importantly, make them happier, he said.

"It will be conceptually taking this anxiety that's on their shoulders and putting it on the shoulders of machines," Brown said. "They won't know any better because it's the way things will have always been. But we'll be taking burden off of people's lives and erasing that from the human experience."

SEE ALSO: The CEO of a startup that just raised $25 million asks every potential hire the same question, and it has nothing to do with work

DON'T MISS: Startup founders who landed a deal with Mark Cuban on 'Shark Tank' used a 100-year-old piece of business advice to build their company from the ground up

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• BMW and Mini have announced their fifth class of startups in their Urban-X lab in Brooklyn, New York.
• Esther Bahne, BMW Group's head of impact ventures, said the selection process is extremely competitive.
• It's all about taking risks on emerging companies, she said, rather than buying startups to eliminate competition or bolster their offerings.
• Mini is building an apartment building in Shanghai as it transitions into more lifestyle offerings.

When BMW's subbrand Mini arrived in Brooklyn, New York, to establish a technology incubator and accelerator in 2017, it took a different approach to the Silicon Valley norm.

Today, its A/D/O (an acronym derived from Mini's original Amalgamated Drawing Office) space in Brooklyn's hip Greenpoint neighborhood isn't full of the company's branding, nor does it look much like the countless WeWork buildings or similar spaces that dot the area.

Speaking to a group of journalists in the sun-drenched building — which comprises a public space, a coffee shop, an art gallery, and a high-end restaurant — Esther Bahne, BMW Group's head of impact ventures and Mini's head of brand strategy, explained the company's approach to innovation.

"Obviously, we knew about the disruptions that were coming for the car industry, and we were in the middle of it," Bahne said. And while some of her team's recommendations, like making more electric Mini models and changing sales strategies, are similar to moves other old-guard automakers are making in order to stay relevant, the other arm of her team's mission involves zero cars whatsoever: making Mini into a lifestyle brand.

A brand beyond cars

Through its now five classes of startups, Mini is clearly thinking beyond the traditional notion of an automobile and its function in our lives. Executives are quick to boast that the selection process for the incubator is more competitive than the famous YCombinator, which accepts about 1.5% of applicants.

Seven companies have joined Urban-X, the accelerator located at A/D/O, for its newest cohort, the company announced Wednesday. The group spans a wide range of products and services, from The Free Ride, which offers rides in electric golf carts to and from events, to GreenQ, which uses digital analytics to improve trash collection, and Borrow, a peer-to-peer-vehicle-rental app.

"Our teams are with them in the trenches every day," Bahne said. "They have business support, they have financial advisers. I mean, we have to get them onto a stage on demo day in front of millions of dollars in a room, so they have to have their s--- down."

This is a key distinction for Mini, according to Bahne. Other automakers are snapping up small companies to make headlines, add to their product line, take competition off the market, or do all three.

Ford, for example, recently did this with its buyout of scooter startup Spin. Other automakers have purchased self-driving startups, mapping companies, and more for high prices in recent years.

Mini, in contrast, is making small, early-stage investments in companies that could very well fail when their products finally go to market.

"For what we want to do, it is not a smart idea to take them off the market," Bahne said. "It's a really smart idea to have them on the market and make exactly those connections, so we can understand where it's going and be there for the ride."

Mini wants to be a lifestyle brand — starting with apartments

Mini's plans for its diversification don't end with mobility — it wants to be in every part of your life, even your home.

Armed with an array of sampling data, the company saw three major trends that customers valued more than mobility. At the top of the list was living, followed by style and experiences.

So the team set out to create Mini Living — a high-flying, luxury apartment building in Shanghai that aims to take the design process Mini used to create its first car in as little space as possible beyond the commute.

"The idea is that you live on a small, personal footprint but have shared amenities, like a great kitchen and community lounge," Bahne said. "It's like a luxury flat share, but you can still close your door and still have your bathroom."

Mini hopes to set up coworking and design spaces similar to A/D/O in Shanghai and other, future Mini Living sites. Similar to the one in Brooklyn, these will also be a fusion of office space and public areas.

"The mobility space is just d--- exciting right now," Bahne said. "Yes, there are a lot of players out there, but I think we have a very good shot at coming up with quite a few that will work."

Here's the full list of Urban-X's 2018 cohort:

• The Free Ride is an all-electric, short-range ride-sharing company providing city-goers with free, sustainable transportation.
• Borrow is bridging the gap between leasing, ownership, and on-demand ride-sharing by providing short-term electric-vehicle leasing.
• Thrilling is reducing carbon, waste, and water footprints by encouraging the reuse of clothing through vintage- and secondhand-store online marketplaces.
• Treau is building advanced climate-control systems to bring sustainable, comfortable, and efficient cooling and heating to buildings everywhere.
• GreenQ is creating truck-based waste-analytics systems to improve logistics, diversion, and recycling.
• Toggle is building an automated process that utilizes software and industrial robotics to reduce costs and increase productivity of rebar cages used in reinforced-steel projects.
• Gearbuddy uses the internet of things and machine learning to digitize every aspect of construction, including equipment-making, to make construction more efficient, more effective, and safer.

SEE ALSO: The head investor at a $4 billion early-stage venture capital firm explains why he's all in on cannabis and scooters — and reveals what he's most excited about for 2019

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It's an exciting time to be in retail — as a brand, as a consumer, and for us as product writers. The Insider Picks team tested countless new products, learned the stories of many new startups, and followed the growth of dozens of our now-favorite companies. 

A select few retail companies really impressed us in 2018, and for a variety of reasons — from superior product launches to admirable social initiatives with quantifiable impact.

They're a standout representation of what it takes to succeed in retail today: the puzzle pieces of mission, product, branding, customer service, and other key business components fitting together to create a cohesive solution to the needs and wants of consumers. 

Learn more about the all-stars of 2018 retail below. 

Everlane

Shop Everlane here

Everlane has much to celebrate this year, including the opening of its first brick-and-mortar stores, which were welcomed with open arms in San Francisco and New York; stellar product drops like basic but comfortable underwear, the soft leather flats we can't stop talking about, and an outerwear collection made from recycled plastic water bottles; and another successful anti-Black Friday initiative that sent $260,000 to help fund beach cleanups across the country.

The brand impressed us throughout the year for its continued commitment to ethical, transparent manufacturing practices and almost-eerie grasp of the styles customers crave — and how to fill the gaps with its own minimalist, carefully curated take. 

Dagne Dover

Shop Dagne Dover here

It's not just you — we've been seeing a lot more Dagne Dover bags in the streets of urban jungles, too. This might be because of its increased but carefully managed offline presence in select Nordstrom stores, Equinox boutiques, and BANDIER shops, or confident push into styles and textures you wouldn't expect from a women's work bag company.

Whether it's a work tote, gym and travel bag, or laptop bag, the women of Insider Picks have agreed that Dagne Dover hits it out of the park every single time with a consistent track record that's not always easy for experimental startups to achieve. 

Patagonia

Shop Patagonia here

More so it seems than other clothing industries, outdoor brands share a special connection with the environments they design for. With the push into recycled materials like down and cashmere, and the no-hesitation decision to send its $10 million 2018 tax cut to grassroots environmental activist groups, Patagonia ramped up its efforts to protect the outdoors. 

The ubiquity of its vests and sweaters might inspire joke Instagram accounts, but at least they're the products of a highly-rated B Corp with a conscience. In February, it launched Patagonia Action Works to connect individuals to events, petitions, and organizations they might be interested in, and on Election Day, stores across the country closed as a reminder for citizens to vote.

• Andreessen Horowitz's General Partner Angela Strange spoke about the history of the insurance industry and the tech companies that are helping to shape its future. 
• Strange explains why no new insurance company has cracked the Fortune 500 list since before World War II. 
• She's confident, however, that the industry is ripe for disruption: "The innovation we’ve seen over the last three centuries [in insurance] isn’t going to be nearly as exciting as what happens over the next three decades."
• The full video of Strange's presentation can be found here.

At Andreessen Horowitz's annual Innovation Summit in November, a16z General Partner Angela Strange spoke about the history of the insurance industry and the tech companies that are helping to shape its future. 

Strange explains the difficulties that incumbent companies face, which is why no new insurance company has cracked the Fortune 500 list since before World War II. 

With the advent of new data analysis technology however, Strange is confident that the insurance industry is bound for a seismic shift.

"The innovation we’ve seen over the last three centuries [in insurance] isn’t going to be nearly as exciting as what happens over the next three decades," she said. 

Chek out BI's recap of Strange's presentation on tech and the future of  the insurance industry below (you can also watch the full video here): 

SEE ALSO: This Andreessen Horowitz General Partner discusses the future of home buying and the startups that are turning the 'broken' real estate industry on its head

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The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.

Startups are often seen as incubators or think tanks making better, smarter, or cooler products faster than traditional companies can. And thanks to the lean businesses models made possible by the internet, those products don't have to cost more than the status quo they're replacing. 

Their uniqueness, cool origin stories, and — on average — more sustainable and ethical business practices also make them particularly good gifts. Below are 76 up-and-coming startups we love to shop at, plus a cheat sheet for what to buy from each of them.

Below, you'll find 76 of the best gifts you can buy from startups this year.

Looking for more gift ideas? Check out all of Insider Picks' holiday gift guides for 2018 here.

Allbirds

What to buy:
Women's Wool Loungers, $95
Men's Wool Loungers, $95

This is the footwear company responsible for the merino wool sneakers and loungers often called the "most comfortable shoes in the world"— a statement we agreed with after trying them. They're great for everyday use or for traveling, and you'll find them in high concentrations in hubs like Silicon Valley and New York City. 

Allbirds are also a great gift for environmentally-conscious shoppers. The company is well-known for practicing "better business" and engineering its shoes from sustainable wool, eucalyptus leaves, or foam made from sugar cane.

Brooklinen

Atlas Coffee Club

What to buy:
Three-Month Subscription, $55

Atlas Coffee Club is a monthly coffee subscription that curates freshly-roasted, micro-lot coffees from around the world and sends them to your door. Since the coffees span the globe, each shipment is meant to connect recipients with the culture that produced it. Shipments include a corresponding postcard (plus flavor notes and brewing tips), and the coffee bag designs are inspired by local landscapes and textiles. 

The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.

• FoundersCard is an exclusive membership for startup founders, CEOs, entrepreneurs, and just about anyone with that "innovator" mindset.
• In addition to getting access to private networking events, FoundersCard members get VIP perks, discounts, and extras from retailers and services ranging from airlines and hotels, clothing brands, and gyms to office services.
• Until December 31, 2018, FoundersCard is offering a discounted rate exclusively for Business Insider readers, and a waived initiation fee. To get the discount, you'll have to apply through this page.

If you're an entrepreneur, an innovator, a startup creator — in other words, a founder — there's a unique and exclusive program that you might be interested in joining. Beyond personal benefits, it can provide direct, tangible benefits to the business or project that you're trying to grow.

FoundersCard is a private membership club for — well, founders — designed to provide members with various elite statuses, VIP treatment, and top benefits. In addition, FoundersCard fosters an ambitious, social community of similarly driven people from different industries, helping to facilitate networking opportunities, connections, and more.

Despite its name, the FoundersCard isn't a credit card and doesn't involve transactions, which means that anyone can apply, regardless of what country they're from.

FoundersCard was founded in 2009 by Eric Kuhn, a new Austin-based venture for a veteran entrepreneur of the 1990s and early-2000s. While the card initially grew its network and offerings slowly — and had a few early bumps in the road — it's made leaps and bounds over the past few years as an organization. Since running into a few issues in its early years, it has bolstered its membership, and made connections with a lot of travel, lifestyle, and business services companies.

If FoundersCard sounds like something that could be useful to you, read on to learn more about how it works — and to take advantage of a discounted rate of $395 per year (compared to the normal $595) with a waived initiation fee (usually $95). This rate is a special exclusive for Business Insider readers who apply through this page.

How it works

To join FoundersCard, you have to complete an application — because the organization is designed to be exclusive and especially curated to be useful and enjoyable for members, everyone isn't always accepted. The process is fairly subjective, 

You can apply for a preview membership to get a better sense of which benefits are currently active. From there (or right away, if you don't care about the preview), you can fill out the complete application. You have to enter your personal details, including your company name and your title — FoundersCard is open to people other than strictly company founders — as well as your contact and billing information. If you're approved, your payment method will be charged the first year's annual dues — $395, with FoundersCard's exclusive offer for Business Insider readers, or $595 without — and a one-time $95 initiation fee — waived for Business Insider readers. 

Benefits of FoundersCard membership

FoundersCard offers a wide range of benefits that can be loosely broken into three categories: savings and discounts, VIP treatment and perks, and exclusive events.

FoundersCard hosts an ongoing series of networking events in cities with high concentrations of members — thanks to business travel, though, there are often different people and new faces at these mixers, even if you go to two in a row in the same city. Usually with 100–200 members, the networking events offer attendees an opportunity to mingle, make connections, and share experience with members from a wide spectrum of industries.

Other benefits tend to change as promotions become active, things become available, or FoundersCard negotiates a new partnership or improvement to an existing one, so it's difficult to share a comprehensive picture of what membership entails. There are also a ton of different benefits — this is a deliberate move to appeal to the widest possible cross-section of member, so that there are appealing things to many different people.

The following are examples of some perks available at the time of publication. FoundersCard provided Business Insider with a temporary active account in order to access the full benefits portal.

Airline discounts and elite/VIP perks, including:

• Cathay Pacific offers 5-25% off flights, as well as a complimentary upgrade to Silver elite status. That status includes priority check-in, complimentary advance seat reservations, access to business class lounges while traveling on the airline in any class, and an extra baggage allowance. The status is valid for a year, after which you'll need to re-qualify through normal methods.
• British Airways offers FoundersCard members up to 10% off most round-trip fares between the US or Canada and the UK.
• Alaska Airlines offers 5% off fares within the Continental US, Hawaii, and Canada.
• JetBlue features preferred flat fares for Mint (business class) transcontinental flights, plus up to 5% off coach and business class tickets. Mint fares are as low as $800.
• American Airlines offers a changing list of benefits, including extra frequent flyer miles, elite qualifying points, or the opportunity to receive complimentary Platinum status for three months, with the chance to keep it by flying a certain required amount within three months.
• Qantas, the Australian flag carrier, offers a whopping 10–25% off flights from the US to Australia or New Zealand.
• Emirates offers 5–10% off US originating fares. The airline serves more than 125 destinations around the world, and offers particularly useful routing for those traveling from the US to the Middle East, Asia, and Africa.
• Singapore Airlines discounts US originating flights up to 5%.
• JetSmarter, a service that helps members find available seats on private and chartered flights as an alternative to flying commercial — but for a much cheaper price tag than flying private normally carries — offers FoundersCard members a free three-month trial.

Rental car and chauffeur service discounts and elite statuses, including:

• Complimentary Preferred Plus membership at Avis, and up to 25% off rentals.
• Platinum membership at 15% off rentals at Sixt Rent a Car.
• 20% off all Silvercar reservations — the founder of Silvercar is a FoundersCard member.
• Credits and discounts with major car services including GroundLink, EmpireCLS, Carey, and Getaround.

Exclusive FoundersCard rates, elite statuses, and perks at various hotels brands, including:

• Starwood
• Marriott
• Kimpton
• Hilton
• Park Hyatt
• The Standard
• Mandarin Oriental
• Omni Hotels & Resorts, and more.

Lifestyle and retail discounts, including:

• Discounts when you buy or lease a new Audi.
• 20% off at John Varvatos.
• Up to $10,000 off when you buy or lease a new BMW.
• A complimentary $100 credit at Trunk Club— the founder and CEO of the company is a FoundersCard member.
• Complimentary Diamond Total Rewards status at Caesars resorts and casinos, plus 20% off most rooms.
• 20% off at 1-800-Flowers.
• 15% off headphones, speakers, and more from Bang & Olufsen.
• Discounts at other retailers including Adidas, Reebok, Indochino, Rent The Runway, Cole Haan, Tommy John, Todd Snyder, and Jonathan Adler, and more.
• Discounts or credits at gyms, fitness studios, and wellness centers, including Equinox, Crunch, SoulCycle, Bliss Spa, Peloton, CorePower Yoga, and more.

Business discounts, including:

• 15% off voice and data plans with AT&T Wireless.
• Up to 47% off UPS.
• Up to 50% off Dell computers.
• 20% off business card and stationary orders from MOO — the company's CEO is a FoundersCard member.
• A free year of service from the Phone.com virtual office service.
• A flat 20% discount off products and services from LegalZoom.
• Loyalty pricing at Apple.
• 40% off Lenovo computers.
• 25% off classes at General Assembly — one of the co-founders is a FoundersCard member.

This is far from a conclusive list. FoundersCard has hundreds of benefits, discounts, and offers available, and can offer enough value to outweigh the annual fee even if you're a sole proprietor just getting your idea off the ground, or even an individual who can take advantage of the retail and gym discounts.

If your small business has grown a bit, though, you can get tremendous value from discounts on shipping, IT services and gear, travel, and more.

Between that, and the opportunity to network with like-minded and similarly focused entrepreneurs, FoundersCard presents a unique and potentially valuable opportunity — whether it's worth the $395 annual fee (with the Business Insider discount) depends on you. 

Click here to learn more about FoundersCard's offer exclusively for Business Insider readers.

SEE ALSO: The best credit card rewards, bonuses, and perks

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• Uber employees are most likely start the next class of hot startups, according to a survey in First Round Capital's 2018 State of Startups report.
• The survey found that 23% of respondents believed Uber employees were the most likely to become the next generation of notable founders within the next five years.
• About 16% thought Slack employees had the best shot, and about 15% thought they would come from Stripe.
• The most infamous group of startup founders was the PayPal Mafia, the group of PayPal founders and early executives that included the likes of Peter Thiel, Reid Hoffman, and Elon Musk.

Uber employees are most likely to start the next class of hot new startups.

That's according to a survey included in First Round Capital's 2018 State of Startups report, which was released on Thursday.

The survey found that 23% of respondents believed Uber employees were the most likely to become the next generation of notable founders within the next five years.

About 16% thought employees at Slack (last valued at $7.1 billion) had the best shot of creating the "next big thing," and about 15% thought they would come from online-payments company Stripe.

The most infamous group of alumni came from PayPal. Known as the PayPal Mafia, this group of overachieving entrepreneurs included Peter Thiel (cofounder of $20 billion Palantir), Reid Hoffman (cofounder of LinkedIn, which Microsoft bought for $26.2 billion), Jeremy Stoppelman (cofounder of Yelp, valued at $3 billion on the public markets), and Elon Musk (cofounder of Tesla and founder of SpaceX).

Read more:Meet The PayPal Mafia, The Richest Group Of Men In Silicon Valley

Only time will tell if Uber employees can become the next PayPal Mafia. But with the company's S-1 filing last week, which could see it go public at a valuation as high as $120 billion, current Uber employees may be cashing out and starting their new projects quite soon.

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