Clean API Call With React Hooks
| Photo by Juanjo Jaramillo on Unsplash |
Calling APIs is the most common thing to do in any modern web application. When it comes to talking with an API then most of the time we need to do a lot of repetitive things like getting data from an API call, handling the success or error case, and so on.
When calling tens of hundreds of API calls we always have to do those tedious tasks. We can handle those things efficiently by putting a higher level of abstraction over those barebone API calls, whereas in some small applications, sometimes we don’t even care.
The problem comes when we start adding new features on top of the existing features without handling the API calls in an efficient and reusable manner. In that case for all of those API calls related repetitions, we end up with a lot of repetitive code across the whole application.
In React, we have different approaches for calling an API. Nowadays mostly we use React hooks. With React hooks, it’s possible to handle API calls in a very clean and consistent way throughout the application in spite of whatever the application size is. So let’s see how we can make a clean and reusable API calling layer using React hooks for a simple web application.
I’m using a code sandbox for this blog which you can get here.
import "./styles.css";
import React, { useEffect, useState } from "react";
import axios from "axios";
export default function App() {
const [posts, setPosts] = useState(null);
const [error, setError] = useState("");
const [loading, setLoading] = useState(false);
useEffect(() => {
handlePosts();
}, []);
const handlePosts = async () => {
setLoading(true);
try {
const result = await axios.get(
"https://jsonplaceholder.typicode.com/posts"
);
setPosts(result.data);
} catch (err) {
setError(err.message || "Unexpected Error!");
} finally {
setLoading(false);
}
};
return (
<div className="App">
<div>
<h1>Posts</h1>
{loading && <p>Posts are loading!</p>}
{error && <p>{error}</p>}
<ul>
{posts?.map((post) => (
<li key={post.id}>{post.title}</li>
))}
</ul>
</div>
</div>
);
}
I know the example above isn’t the best code but at least it’s working and it’s valid code. I will try to improve that later. For now, we can just focus on the bare minimum things for calling an API.
Here, you can try to get posts data from JsonPlaceholer. Those are the most common steps we follow for calling an API like requesting data, handling loading, success, and error cases.
If we try to call another API from the same component then how that would gonna look? Let’s see.
500: Internal Server Error
Now it’s going insane! For calling two simple APIs we’ve done a lot of duplication. On a top-level view, the component is doing nothing but just making two GET requests and handling the success and error cases. For each request, it’s maintaining three states which will periodically increase later if we’ve more calls.
Let’s refactor to make the code more reusable with fewer repetitions.
Step 1: Create a Hook for the Redundant API Request Codes
Most of the repetitions we have done so far are about requesting data, handing the async things, handling errors, success, and loading states. How about encapsulating those things inside a hook?
The only unique things we are doing inside handleComments and handlePosts are calling different endpoints. The rest of the things are pretty much the same. So we can create a hook that will handle the redundant works for us and from outside we’ll let it know which API to call.
500: Internal Server Error
Here, this request function is identical to what we were doing on the handlePosts and handleComments. The only difference is, it’s calling an async function apiFunc which we will provide as a parameter with this hook. This apiFunc is the only independent thing among any of the API calls we need.
With hooks in action, let’s change our old codes in App component, like this:
500: Internal Server Error
How about the current code? Isn’t it beautiful without any repetitions and duplicate API call handling things?
Let’s continue our journey from the current code. We can make App component more elegant. Now it knows a lot of details about the underlying library for the API call. It shouldn’t know that. So, here’s the next step…
Step 2: One Component Should Take Just One Responsibility
Our App component knows too much about the API calling mechanism. Its responsibility should just request the data. How the data will be requested under the hood, it shouldn’t care about that.
We will extract the API client-related codes from the App component. Also, we will group all the API request-related codes based on the API resource. Now, this is our API client:
import axios from "axios";
const apiClient = axios.create({
// Later read this URL from an environment variable
baseURL: "https://jsonplaceholder.typicode.com"
});
export default apiClient;
All API calls for comments resource will be in the following file:
import client from "./client";
const getComments = () => client.get("/comments");
export default {
getComments
};
All API calls for posts resource are placed in the following file:
import client from "./client";
const getPosts = () => client.get("/posts");
export default {
getPosts
};
Finally, the App component looks like the following:
import "./styles.css";
import React, { useEffect } from "react";
import commentsApi from "./api/comments";
import postsApi from "./api/posts";
import useApi from "./hooks/useApi";
export default function App() {
const getPostsApi = useApi(postsApi.getPosts);
const getCommentsApi = useApi(commentsApi.getComments);
useEffect(() => {
getPostsApi.request();
getCommentsApi.request();
}, []);
return (
<div className="App">
{/* Post List */}
<div>
<h1>Posts</h1>
{getPostsApi.loading && <p>Posts are loading!</p>}
{getPostsApi.error && <p>{getPostsApi.error}</p>}
<ul>
{getPostsApi.data?.map((post) => (
<li key={post.id}>{post.title}</li>
))}
</ul>
</div>
{/* Comment List */}
<div>
<h1>Comments</h1>
{getCommentsApi.loading && <p>Comments are loading!</p>}
{getCommentsApi.error && <p>{getCommentsApi.error}</p>}
<ul>
{getCommentsApi.data?.map((comment) => (
<li key={comment.id}>{comment.name}</li>
))}
</ul>
</div>
</div>
);
}
Now it doesn’t know anything about how the APIs get called. Tomorrow if we want to change the API calling library from axios to fetch or anything else, our App component code will not get affected. We can just change the codes form client.js This is the beauty of abstraction.
Apart from the abstraction of API calls, Appcomponent isn’t right the place to show the list of the posts and comments. It’s a high-level component. It shouldn’t handle such low-level data interpolation things.
So we should move this data display-related things to another low-level component. Here I placed those directly in the App component just for the demonstration purpose and not to distract with component composition-related things.
Final Thoughts
The React library gives the flexibility for using any kind of third-party library based on the application’s needs. As it doesn’t have any predefined architecture so different teams/developers adopted different approaches to developing applications with React. There’s nothing good or bad. We choose the development practice based on our needs/choices. One thing that is there beyond any choices is writing clean and maintainable codes.
More on Web3 & Crypto
Elnaz Sarraf
3 years ago
Why Bitcoin's Crash Could Be Good for Investors
The crypto market crashed in June 2022. Bitcoin and other cryptocurrencies hit their lowest prices in over a year, causing market panic. Some believe this crash will benefit future investors.
Before I discuss how this crash might help investors, let's examine why it happened. Inflation in the U.S. reached a 30-year high in 2022 after Russia invaded Ukraine. In response, the U.S. Federal Reserve raised interest rates by 0.5%, the most in almost 20 years. This hurts cryptocurrencies like Bitcoin. Higher interest rates make people less likely to invest in volatile assets like crypto, so many investors sold quickly.
The crypto market collapsed. Bitcoin, Ethereum, and Binance dropped 40%. Other cryptos crashed so hard they were delisted from almost every exchange. Bitcoin peaked in April 2022 at $41,000, but after the May interest rate hike, it crashed to $28,000. Bitcoin investors were worried. Even in bad times, this crash is unprecedented.
Bitcoin wasn't "doomed." Before the crash, LUNA was one of the top 5 cryptos by market cap. LUNA was trading around $80 at the start of May 2022, but after the rate hike?
Less than 1 cent. LUNA lost 99.99% of its value in days and was removed from every crypto exchange. Bitcoin's "crash" isn't as devastating when compared to LUNA.
Many people said Bitcoin is "due" for a LUNA-like crash and that the only reason it hasn't crashed is because it's bigger. Still false. If so, Bitcoin should be worth zero by now. We didn't. Instead, Bitcoin reached 28,000, then 29k, 30k, and 31k before falling to 18k. That's not the world's greatest recovery, but it shows Bitcoin's safety.
Bitcoin isn't falling constantly. It fell because of the initial shock of interest rates, but not further. Now, Bitcoin's value is more likely to rise than fall. Bitcoin's low price also attracts investors. They know what prices Bitcoin can reach with enough hype, and they want to capitalize on low prices before it's too late.
Bitcoin's crash was bad, but in a way it wasn't. To understand, consider 2021. In March 2021, Bitcoin surpassed $60k for the first time. Elon Musk's announcement in May that he would no longer support Bitcoin caused a massive crash in the crypto market. In May 2017, Bitcoin's price hit $29,000. Elon Musk's statement isn't worth more than the Fed raising rates. Many expected this big announcement to kill Bitcoin.
Not so. Bitcoin crashed from $58k to $31k in 2021. Bitcoin fell from $41k to $28k in 2022. This crash is smaller. Bitcoin's price held up despite tensions and stress, proving investors still believe in it. What happened after the initial crash in the past?
Bitcoin fell until mid-July. This is also something we’re not seeing today. After a week, Bitcoin began to improve daily. Bitcoin's price rose after mid-July. Bitcoin's price fluctuated throughout the rest of 2021, but it topped $67k in November. Despite no major changes, the peak occurred after the crash. Elon Musk seemed uninterested in crypto and wasn't likely to change his mind soon. What triggered this peak? Nothing, really. What really happened is that people got over the initial statement. They forgot.
Internet users have goldfish-like attention spans. People quickly forgot the crash's cause and were back investing in crypto months later. Despite the market's setbacks, more crypto investors emerged by the end of 2017. Who gained from these peaks? Bitcoin investors who bought low. Bitcoin not only recovered but also doubled its ROI. It was like a movie, and it shows us what to expect from Bitcoin in the coming months.
The current Bitcoin crash isn't as bad as the last one. LUNA is causing market panic. LUNA and Bitcoin are different cryptocurrencies. LUNA crashed because Terra wasn’t able to keep its peg with the USD. Bitcoin is unanchored. It's one of the most decentralized investments available. LUNA's distrust affected crypto prices, including Bitcoin, but it won't last forever.
This is why Bitcoin will likely rebound in the coming months. In 2022, people will get over the rise in interest rates and the crash of LUNA, just as they did with Elon Musk's crypto stance in 2021. When the world moves on to the next big controversy, Bitcoin's price will soar.
Bitcoin may recover for another reason. Like controversy, interest rates fluctuate. The Russian invasion caused this inflation. World markets will stabilize, prices will fall, and interest rates will drop.
Next, lower interest rates could boost Bitcoin's price. Eventually, it will happen. The U.S. economy can't sustain such high interest rates. Investors will put every last dollar into Bitcoin if interest rates fall again.
Bitcoin has proven to be a stable investment. This boosts its investment reputation. Even if Ethereum dethrones Bitcoin as crypto king one day (or any other crypto, for that matter). Bitcoin may stay on top of the crypto ladder for a while. We'll have to wait a few months to see if any of this is true.
This post is a summary. Read the full article here.
Tim Denning
3 years ago
The Dogecoin millionaire mysteriously disappeared.
The American who bought a meme cryptocurrency.
Cryptocurrency is the financial underground.
I love it. But there’s one thing I hate: scams. Over the last few years the Dogecoin cryptocurrency saw massive gains.
Glauber Contessoto overreacted. He shared his rags-to-riches cryptocurrency with the media.
He's only wealthy on paper. No longer Dogecoin millionaire.
Here's what he's doing now. It'll make you rethink cryptocurrency investing.
Strange beginnings
Glauber once had a $36,000-a-year job.
He grew up poor and wanted to make his mother proud. Tesla was his first investment. He bought GameStop stock after Reddit boosted it.
He bought whatever was hot.
He was a young investor. Memes, not research, influenced his decisions.
Elon Musk (aka Papa Elon) began tweeting about Dogecoin.
Doge is a 2013 cryptocurrency. One founder is Australian. He insists it's funny.
He was shocked anyone bought it LOL.
Doge is a Shiba Inu-themed meme. Now whenever I see a Shiba Inu, I think of Doge.
Elon helped drive up the price of Doge by talking about it in 2020 and 2021 (don't take investment advice from Elon; he's joking and gaslighting you).
Glauber caved. He invested everything in Doge. He borrowed from family and friends. He maxed out his credit card to buy more Doge. Yuck.
Internet dubbed him a genius. Slumdog millionaire and The Dogefather were nicknames. Elon pumped Doge on social media.
Good times.
From $180,000 to $1,000,000+
TikTok skyrocketed Doge's price.
Reddit fueled up. Influencers recommended buying Doge because of its popularity. Glauber's motto:
Scared money doesn't earn.
Glauber was no broke ass anymore.
His $180,000 Dogecoin investment became $1M. He championed investing. He quit his dumb job like a rebellious millennial.
A puppy dog meme captivated the internet.
Rise and fall
Whenever I invest in anything I ask myself “what utility does this have?”
Dogecoin is useless.
You buy it for the cute puppy face and hope others will too, driving up the price. All cryptocurrencies fell in 2021's second half.
Central banks raised interest rates, and inflation became a pain.
Dogecoin fell more than others. 90% decline.
Glauber’s Dogecoin is now worth $323K. Still no sales. His dog god is unshakeable. Confidence rocks. Dogecoin millionaire recently said...
“I should have sold some.”
Yes, sir.
He now avoids speculative cryptocurrencies like Dogecoin and focuses on Bitcoin and Ethereum.
I've long said this. Starbucks is building on Ethereum.
It's useful. Useful. Developers use Ethereum daily. Investing makes you wiser over time, like the Dogecoin millionaire.
When risk b*tch slaps you, humility follows, as it did for me when I lost money.
You have to lose money to make money. Few understand.
Dogecoin's omissions
You might be thinking Dogecoin is crap.
I'll take a contrarian stance. Dogecoin does nothing, but it has a strong community. Dogecoin dominates internet memes.
It's silly.
Not quite. The message of crypto that many people forget is that it’s a change in business model.
Businesses create products and services, then advertise to find customers. Crypto Web3 works backwards. A company builds a fanbase but sells them nothing.
Once the community reaches MVC (minimum viable community), a business can be formed.
Community members are relational versus transactional. They're invested in a cause and care about it (typically ownership in the business via crypto).
In this new world, Dogecoin has the most important feature.
Summary
While Dogecoin does have a community I still dislike it.
It's all shady. Anything Elon Musk recommends is a bad investment (except SpaceX & Tesla are great companies).
Dogecoin Millionaire has wised up and isn't YOLOing into more dog memes.
Don't follow the crowd or the hype. Investing is a long-term sport based on fundamentals and research.
Since Ethereum's inception, I've spent 10,000 hours researching.
Dogecoin will be the foundation of something new, like Pets.com at the start of the dot-com revolution. But I doubt Doge will boom.
Be safe!
Julie Plavnik
3 years ago
How to Become a Crypto Broker [Complying and Making Money]
Three options exist. The third one is the quickest and most fruitful.
You've mastered crypto trading and want to become a broker.
So you may wonder: Where to begin?
If so, keep reading.
Today I'll compare three different approaches to becoming a cryptocurrency trader.
What are cryptocurrency brokers, and how do they vary from stockbrokers?
A stockbroker implements clients' market orders (retail or institutional ones).
Brokerage firms are regulated, insured, and subject to regulatory monitoring.
Stockbrokers are required between buyers and sellers. They can't trade without a broker. To trade, a trader must open a broker account and deposit money. When a trader shops, he tells his broker what orders to place.
Crypto brokerage is trade intermediation with cryptocurrency.
In crypto trading, however, brokers are optional.
Crypto exchanges offer direct transactions. Open an exchange account (no broker needed) and make a deposit.
Question:
Since crypto allows DIY trading, why use a broker?
Let's compare cryptocurrency exchanges vs. brokers.
Broker versus cryptocurrency exchange
Most existing crypto exchanges are basically brokers.
Examine their primary services:
connecting purchasers and suppliers
having custody of clients' money (with the exception of decentralized cryptocurrency exchanges),
clearance of transactions.
Brokerage is comparable, don't you think?
There are exceptions. I mean a few large crypto exchanges that follow the stock exchange paradigm. They outsource brokerage, custody, and clearing operations. Classic exchange setups are rare in today's bitcoin industry.
Back to our favorite “standard” crypto exchanges. All-in-one exchanges and brokers. And usually, they operate under a broker or a broker-dealer license, save for the exchanges registered somewhere in a free-trade offshore paradise. Those don’t bother with any licensing.
What’s the sense of having two brokers at a time?
Better liquidity and trading convenience.
The crypto business is compartmentalized.
We have CEXs, DEXs, hybrid exchanges, and semi-exchanges (those that aggregate liquidity but do not execute orders on their sides). All have unique regulations and act as sovereign states.
There are about 18k coins and hundreds of blockchain protocols, most of which are heterogeneous (i.e., different in design and not interoperable).
A trader must register many accounts on different exchanges, deposit funds, and manage them all concurrently to access global crypto liquidity.
It’s extremely inconvenient.
Crypto liquidity fragmentation is the largest obstacle and bottleneck blocking crypto from mass adoption.
Crypto brokers help clients solve this challenge by providing one-gate access to deep and diverse crypto liquidity from numerous exchanges and suppliers. Professionals and institutions need it.
Another killer feature of a brokerage may be allowing clients to trade crypto with fiat funds exclusively, without fiat/crypto conversion. It is essential for professional and institutional traders.
Who may work as a cryptocurrency broker?
Apparently, not anyone. Brokerage requires high-powered specialists because it involves other people's money.
Here's the essentials:
excellent knowledge, skills, and years of trading experience
high-quality, quick, and secure infrastructure
highly developed team
outstanding trading capital
High-ROI network: long-standing, trustworthy connections with customers, exchanges, liquidity providers, payment gates, and similar entities
outstanding marketing and commercial development skills.
What about a license for a cryptocurrency broker? Is it necessary?
Complex question.
If you plan to play in white-glove jurisdictions, you may need a license. For example, in the US, as a “money transmitter” or as a CASSP (crypto asset secondary services provider) in Australia.
Even in these jurisdictions, there are no clear, holistic crypto brokerage and licensing policies.
Your lawyer will help you decide if your crypto brokerage needs a license.
Getting a license isn't quick. Two years of patience are needed.
How can you turn into a cryptocurrency broker?
Finally, we got there! 🎉
Three actionable ways exist:
To kickstart a regulated stand-alone crypto broker
To get a crypto broker franchise, and
To become a liquidity network broker.
Let's examine each.
1. Opening a regulated cryptocurrency broker
It's difficult. Especially If you're targeting first-world users.
You must comply with many regulatory, technical, financial, HR, and reporting obligations to keep your organization running. Some are mentioned above.
The licensing process depends on the products you want to offer (spots or derivatives) and the geographic areas you plan to service. There are no general rules for that.
In an overgeneralized way, here are the boxes you will have to check:
capital availability (usually a large amount of capital c is required)
You will have to move some of your team members to the nation providing the license in order to establish an office presence there.
the core team with the necessary professional training (especially applies to CEO, Head of Trading, Assistant to Head of Trading, etc.)
insurance
infrastructure that is trustworthy and secure
adopted proper AML/KYC/financial monitoring policies, etc.
Assuming you passed, what's next?
I bet it won’t be mind-blowing for you that the license is just a part of the deal. It won't attract clients or revenue.
To bring in high-dollar clientele, you must be a killer marketer and seller. It's not easy to convince people to give you money.
You'll need to be a great business developer to form successful, long-term agreements with exchanges (ideally for no fees), liquidity providers, banks, payment gates, etc. Persuade clients.
It's a tough job, isn't it?
I expect a Quora-type question here:
Can I start an unlicensed crypto broker?
Well, there is always a workaround with crypto!
You can register your broker in a free-trade zone like Seychelles to avoid US and other markets with strong watchdogs.
This is neither wise nor sustainable.
First, such experiments are illegal.
Second, you'll have trouble attracting clients and strategic partners.
A license equals trust. That’s it.
Even a pseudo-license from Mauritius matters.
Here are this method's benefits and downsides.
Cons first.
As you navigate this difficult and expensive legal process, you run the risk of missing out on business prospects. It's quite simple to become excellent compliance yet unable to work. Because your competitors are already courting potential customers while you are focusing all of your effort on paperwork.
Only God knows how long it will take you to pass the break-even point when everything with the license has been completed.
It is a money-burning business, especially in the beginning when the majority of your expenses will go toward marketing, sales, and maintaining license requirements. Make sure you have the fortitude and resources necessary to face such a difficult challenge.
Pros
It may eventually develop into a tool for making money. Because big guys who are professionals at trading require a white-glove regulated brokerage. You have every possibility if you work hard in the areas of sales, marketing, business development, and wealth. Simply put, everything must align.
Launching a regulated crypto broker is analogous to launching a crypto exchange. It's ROUGH. Sure you can take it?
2. Franchise for Crypto Broker (Crypto Sub-Brokerage)
A broker franchise is easier and faster than becoming a regulated crypto broker. Not a traditional brokerage.
A broker franchisee, often termed a sub-broker, joins with a broker (a franchisor) to bring them new clients. Sub-brokers market a broker's products and services to clients.
Sub-brokers are the middlemen between a broker and an investor.
Why is sub-brokering easier?
less demanding qualifications and legal complexity. All you need to do is keep a few certificates on hand (each time depends on the jurisdiction).
No significant investment is required
there is no demand that you be a trading member of an exchange, etc.
As a sub-broker, you can do identical duties without as many rights and certifications.
What about the crypto broker franchise?
Sub-brokers aren't common in crypto.
In most existing examples (PayBito, PCEX, etc.), franchises are offered by crypto exchanges, not brokers. Though we remember that crypto exchanges are, in fact, brokers, do we?
Similarly:
For a commission, a franchiser crypto broker receives new leads from a crypto sub-broker.
See above for why enrolling is easy.
Finding clients is difficult. Most crypto traders prefer to buy-sell on their own or through brokers over sub-broker franchises.
3. Broker of the Crypto Trading Network (or a Network Broker)
It's the greatest approach to execute crypto brokerage, based on effort/return.
Network broker isn't an established word. I wrote it for clarity.
Remember how we called crypto liquidity fragmentation the current crypto finance paradigm's main bottleneck?
Where there's a challenge, there's progress.
Several well-funded projects are aiming to fix crypto liquidity fragmentation. Instead of launching another crypto exchange with siloed trading, the greatest minds create trading networks that aggregate crypto liquidity from desynchronized sources and enable quick, safe, and affordable cross-blockchain transactions. Each project offers a distinct option for users.
Crypto liquidity implies:
One-account access to cryptocurrency liquidity pooled from network participants' exchanges and other liquidity sources
compiled price feeds
Cross-chain transactions that are quick and inexpensive, even for HFTs
link between participants of all kinds, and
interoperability among diverse blockchains
Fast, diversified, and cheap global crypto trading from one account.
How does a trading network help cryptocurrency brokers?
I’ll explain it, taking Yellow Network as an example.
Yellow provides decentralized Layer-3 peer-to-peer trading.
trade across chains globally with real-time settlement and
Between cryptocurrency exchanges, brokers, trading companies, and other sorts of network members, there is communication and the exchange of financial information.
Have you ever heard about ECN (electronic communication network)? If not, it's an automated system that automatically matches buy and sell orders. Yellow is a decentralized digital asset ECN.
Brokers can:
Start trading right now without having to meet stringent requirements; all you need to do is integrate with Yellow Protocol and successfully complete some KYC verification.
Access global aggregated crypto liquidity through a single point.
B2B (Broker to Broker) liquidity channels that provide peer liquidity from other brokers. Orders from the other broker will appear in the order book of a broker who is peering with another broker on the market. It will enable a broker to broaden his offer and raise the total amount of liquidity that is available to his clients.
Select a custodian or use non-custodial practices.
Comparing network crypto brokerage to other types:
A licensed stand-alone brokerage business is much more difficult and time-consuming to launch than network brokerage, and
Network brokerage, in contrast to crypto sub-brokerage, is scalable, independent, and offers limitless possibilities for revenue generation.
Yellow Network Whitepaper. has more details on how to start a brokerage business and what rewards you'll obtain.
Final thoughts
There are three ways to become a cryptocurrency broker, including the non-conventional liquidity network brokerage. The last option appears time/cost-effective.
Crypto brokerage isn't crowded yet. Act quickly to find your right place in this market.
Choose the way that works for you best and see you in crypto trading.
Discover Web3 & DeFi with Yellow Network!
Yellow, powered by Openware, is developing a cross-chain P2P liquidity aggregator to unite the crypto sector and provide global remittance services that aid people.
Join the Yellow Community and plunge into this decade's biggest product-oriented crypto project.
Observe Yellow Twitter
Enroll in Yellow Telegram
Visit Yellow Discord.
On Hacker Noon, look us up.
Yellow Network will expose development, technology, developer tools, crypto brokerage nodes software, and community liquidity mining.
You might also like
Aaron Dinin, PhD
3 years ago
I'll Never Forget the Day a Venture Capitalist Made Me Feel Like a Dunce
Are you an idiot at fundraising?
Humans undervalue what they don't grasp. Consider NASCAR. How is that a sport? ask uneducated observers. Circular traffic. Driving near a car's physical limits is different from daily driving. When driving at 200 mph, seemingly simple things like changing gas weight or asphalt temperature might be life-or-death.
Venture investors do something similar in entrepreneurship. Most entrepreneurs don't realize how complex venture finance is.
In my early startup days, I didn't comprehend venture capital's intricacy. I thought VCs were rich folks looking for the next Mark Zuckerberg. I was meant to be a sleek, enthusiastic young entrepreneur who could razzle-dazzle investors.
Finally, one of the VCs I was trying to woo set me straight. He insulted me.
How I learned that I was approaching the wrong investor
I was constructing a consumer-facing, pre-revenue marketplace firm. I looked for investors in my old university's alumni database. My city had one. After some research, I learned he was a partner at a growth-stage, energy-focused VC company with billions under management.
Billions? I thought. Surely he can write a million-dollar cheque. He'd hardly notice.
I emailed the VC about our shared alumni status, explaining that I was building a startup in the area and wanted advice. When he agreed to meet the next week, I prepared my pitch deck.
First error.
The meeting seemed like a funding request. Imagine the awkwardness.
His assistant walked me to the firm's conference room and told me her boss was running late. While waiting, I prepared my pitch. I connected my computer to the projector, queued up my PowerPoint slides, and waited for the VC.
He didn't say hello or apologize when he entered a few minutes later. What are you doing?
Hi! I said, Confused but confident. Dinin Aaron. My startup's pitch.
Who? Suspicious, he replied. Your email says otherwise. You wanted help.
I said, "Isn't that a euphemism for contacting investors?" Fundraising I figured I should pitch you.
As he sat down, he smiled and said, "Put away your computer." You need to study venture capital.
Recognizing the business aspects of venture capital
The VC taught me venture capital in an hour. Young entrepreneur me needed this lesson. I assume you need it, so I'm sharing it.
Most people view venture money from an entrepreneur's perspective, he said. They envision a world where venture capital serves entrepreneurs and startups.
As my VC indicated, VCs perceive their work differently. Venture investors don't serve entrepreneurs. Instead, they run businesses. Their product doesn't look like most products. Instead, the VCs you're proposing have recognized an undervalued market segment. By investing in undervalued companies, they hope to profit. It's their investment thesis.
Your company doesn't fit my investment thesis, the venture capitalist told me. Your pitch won't beat my investing theory. I invest in multimillion-dollar clean energy companies. Asking me to invest in you is like ordering a breakfast burrito at a fancy steakhouse. They could, but why? They don't do that.
Yeah, I’m not a fine steak yet, I laughed, feeling like a fool for pitching a growth-stage VC used to looking at energy businesses with millions in revenues on my pre-revenue, consumer startup.
He stressed that it's not necessary. There are investors targeting your company. Not me. Find investors and pitch them.
Remember this when fundraising. Your investors aren't philanthropists who want to help entrepreneurs realize their company goals. Venture capital is a sophisticated investment strategy, and VC firm managers are industry experts. They're looking for companies that meet their investment criteria. As a young entrepreneur, I didn't grasp this, which is why I struggled to raise money. In retrospect, I probably seemed like an idiot. Hopefully, you won't after reading this.
Adrien Book
3 years ago
What is Vitalik Buterin's newest concept, the Soulbound NFT?
Decentralizing Web3's soul
Our tech must reflect our non-transactional connections. Web3 arose from a lack of social links. It must strengthen these linkages to get widespread adoption. Soulbound NFTs help.
This NFT creates digital proofs of our social ties. It embodies G. Simmel's idea of identity, in which individuality emerges from social groups, just as social groups evolve from people.
It's multipurpose. First, gather online our distinctive social features. Second, highlight and categorize social relationships between entities and people to create a spiderweb of networks.
1. 🌐 Reducing online manipulation: Only socially rich or respectable crypto wallets can participate in projects, ensuring that no one can create several wallets to influence decentralized project governance.
2. 🤝 Improving social links: Some sectors of society lack social context. Racism, sexism, and homophobia do that. Public wallets can help identify and connect distinct social groupings.
3. 👩❤️💋👨 Increasing pluralism: Soulbound tokens can ensure that socially connected wallets have less voting power online to increase pluralism. We can also overweight a minority of numerous voices.
4. 💰Making more informed decisions: Taking out an insurance policy requires a life review. Why not loans? Character isn't limited by income, and many people need a chance.
5. 🎶 Finding a community: Soulbound tokens are accessible to everyone. This means we can find people who are like us but also different. This is probably rare among your friends and family.
NFTs are dangerous, and I don't like them. Social credit score, privacy, lost wallet. We must stay informed and keep talking to innovators.
E. Glen Weyl, Puja Ohlhaver and Vitalik Buterin get all the credit for these ideas, having written the very accessible white paper “Decentralized Society: Finding Web3’s Soul”.
Maria Stepanova
3 years ago
How Elon Musk Picks Things Up Quicker Than Anyone Else
Adopt Elon Musk's learning strategy to succeed.
Medium writers rank first and second when you Google “Elon Musk's learning approach”.
My article idea seems unoriginal. Lol
Musk is brilliant.
No doubt here.
His name connotes success and intelligence.
He knows rocket science, engineering, AI, and solar power.
Musk is a Unicorn, but his skills aren't special.
How does he manage it?
Elon Musk has two learning rules that anyone may use.
You can apply these rules and become anyone you want.
You can become a rocket scientist or a surgeon. If you want, of course.
The learning process is key.
Make sure you are creating a Tree of Knowledge according to Rule #1.
Musk told Reddit how he learns:
“It is important to view knowledge as sort of a semantic tree — make sure you understand the fundamental principles, i.e. the trunk and big branches, before you get into the leaves/details or there is nothing for them to hang onto.”
Musk understands the essential ideas and mental models of each of his business sectors.
He starts with the tree's trunk, making sure he learns the basics before going on to branches and leaves.
We often act otherwise. We memorize small details without understanding how they relate to the whole. Our minds are stuffed with useless data.
Cramming isn't learning.
Start with the basics to learn faster. Before diving into minutiae, grasp the big picture.
Rule #2: You can't connect what you can't remember.
Elon Musk transformed industries this way. As his expertise grew, he connected branches and leaves from different trees.
Musk read two books a day as a child. He didn't specialize like most people. He gained from his multidisciplinary education. It helped him stand out and develop billion-dollar firms.
He gained skills in several domains and began connecting them. World-class performances resulted.
Most of us never learn the basics and only collect knowledge. We never really comprehend information, thus it's hard to apply it.
Learn the basics initially to maximize your chances of success. Then start learning.
Learn across fields and connect them.
This method enabled Elon Musk to enter and revolutionize a century-old industry.