Marvin’s Best Weekly Reads August 15th, 2021
"Strive not to be a success, but rather to be of value." - Albert Einstein
"Social commerce will turn us all into shoppable product demos, and our lives into a catalog of stylized products. It will also introduce new revenue streams, business models, marketing strategies, and regulatory hurdles, reversing a short-sighted belief that “the Internet lets you buy, but it doesn’t let you shop.” Social currency is the fuel of the modern retail economy. Community is its killer app."
"In all this, we can borrow freely from science-fiction. But if a handful of novels from the 1980s and 90s continue to supply the best available explanations we have of the world in the 2020s, we should worry. It would signal a devastating failure of our collective imagination.
We are in urgent need of new stories to believe in. New stories that make sense. In the years ahead, let’s write a few we can file under non-fiction."
"For its part, non-dilutive funding can de-risk climate tech investments, accelerate commercialization and market entry, prove product-market fit, and bridge the climate tech valleys of death. Private capital helps demonstrate (and create!) a clear and viable pathway to scale for individual climate solutions."
"To recap, in a world where supply (capital and production) is abundant, we’re going to reorient around what's actually scarce — what people care about. The stakes are high: people only have so much attention and interest and loyalty to give.
This scarcity to abundance and then back to scarcity again flywheel accelerates like this: Software takes over, customers get hooked on new capabilities and then immediately ask for more, which pushes the whole tech cycle to move faster. Entrepreneurs conquer scarcity which leads to abundance, which leads to emergent scarcity somewhere else, which leads to unbundling and rebundling, internet-native business models, and more winner-take most distributions."
"We are learning that the internet provides us access to a limitless variety of goods, services, and communities. This leads to a fragmentation of society along an infinite number of preferences. And we intuitively understand that this fragmentation of wants and needs creates an infinite number of opportunities to create profitable income streams.
The internet created a bountiful opportunity along the long tailed preferences of society.
The millennial and Gen Z generations grew up as digital natives. They have the principles of virality and the value proposition of long tail opportunities ingrained in their brains."
This is interesting. Big oil getting into bitcoin mining.
"Bitcoin mining can occur anywhere in the world with it being an energy intensive process. If all the gas that is completely wasted in being flared was used to power bitcoin mining, it would be sufficient to provide energy for the entire bitcoin network many times over."
Lesson is leverage works both ways. The Archegos saga continues. Almost hard to fathom losing 20 billion dollars. Look forward to the movie and book coming out from this.
"For Hwang’s family office, now comes the inevitable: liquidation. Only months ago, it boasted holdings — built on borrowed money — valued at more than $120 billion. Today, everyone is lining up for the scraps."
I really wrestle with this all the time. My biggest regret over the last 12 years.
"Men, I leave you with this. While you’re running as fast as you can towards the title, promotion, goal, accolade, and a paycheck, all in the name of supporting your children. Make sure you don’t leave them behind. Your legacy as a man will live on far longer through your children than it ever can from accomplishments."
“Stop Caring About the Results”.
When the average person reads that, they think this means sit around and be lazy doing nothing. No. It means you should shot gun as much as possible and let the chips fall.
Notice? The guy who needs money the least tends to attract even more money. The guy who doesn’t care about getting the girl at the bar? He usually get the girl. The guy who has a smile on his face after the 50th sales call that ends with a no? He usually ends up being the head of sales later on.
The single thread that connects all of these “coincidences” is not caring about the *result*. If you care about the end-result the end-result is unlikely to be positive. You end up focusing on things that don’t matter which drain valuable amounts of time from your pool of energy.
Simply stop caring about the result. Iterate. Repeat. Iterate. Repeat. The habits you build will drive the results over the long-term.
And? Once you see something works, step on the gas."
"Maybe the value investors end up being right — the markets are insane and everything will correct back to a historical norm. Maybe the new age investors are right — the market is manipulated and this is the new normal. No one actually knows the answers.
People are taking pre-revenue, pre-product companies public via SPACs at multi-billion dollar valuations. People are buying pictures of fake rocks. And everything in between. The world is insane, but it is likely the result of an insane monetary policy environment that has been a shot in the arm for gamblers around the world."
"The appeal and promise of the passion economy are readily apparent: creators can reach a global audience with just an internet connection and earn a living with only 1,000 or 100 true fans. Some creators today are earning millions of dollars per year through engaging in brand deals, selling digital content, creating courses, and more.
These online micro-entrepreneurs now number over 50 million in the US. At the same time, excitement from the tech industry around the creator/passion economy is at a fever pitch: nearly every large social media platform is rolling out new funds, programs, and features to attract and retain creators. And a multitude of new startups seeks to serve creators and make it easier for them to earn a living.
But just as the gig economy mode of work brought about negative consequences, strong parallels are emerging between the gig economy and creator economy, rooted in the commoditization of work and erosion of worker leverage."
"I think there’s sort of this cultural dynamic where you have people that truly do live in these bubbles and so when you’re in the technology industry in San Francisco or quite honestly the entertainment industry in Los Angeles, I think folks just live entirely in this sort of self-referential bubble.
And you only communicate and only ever interact with people that are in the same industry as you, and I think that leads to just a very, quite honestly parochial sort of inward looking worldview. There is something about a place that is less dominated by technology."
"Not to go fully galaxy brain, but remote work on some level throws out the classical structure of working hours as a whole. While yes, you probably want to be available 9 through 5 (and companies regularly ask for more!), one has to wonder if there won’t be an evaluation of how many human beings actually work all of those hours, and, indeed, consider whether that person could have another job on top of it from another company.
This could mean that people basically become full-time freelancers, taking on jobs from multiple companies at full compensation (if said companies are cool with it), assuming that the work is done and their availability is balanced."
It is a nutty time in VC.
"Now this week, as if to make the case, our Senate passed a $1.2 trillion dollar spending bill for “Real Infrastructure,” which is to say something like $500 billion dollars on the “modernization” of physical infrastructure that in large part already exists, and another $700 billion dollars on… I mean I’m not even sure how to characterize these items.
There are spending allocations for healthcare, childcare, and care for the elderly. There’s a lot of niche “green” programming, there’s military stuff, there’s ambiguous social justice stuff. Critics of the infrastructure bill have mostly focused on the bullshit we’re buying with our newly-minted cash, but it looks like we’re also banning cryptocurrency (destroying things is infrastructure!), and this is not even the bill’s biggest problem. The question consuming me today is how did we come all this way, spend all this money, and not build anything new?"
"Even if Russia’s hydrocarbons become worthless, Russia will still possess something which is always in demand in international relations — military might. Two decades from now, Russia will likely remain a formidable military player. Why not try and convert Russia’s military prowess as well as its pivotal geostrategic position into money? China could become the main customer, generously paying Russia to perform military missions Beijing is unwilling, or unable, to undertake on its own.
Russian private military companies’ activities in some of the world’s flashpoints may already offer a hint of what Moscow may be up to under the envisioned scenario. In a nutshell, Russia could become a giant military contractor — a twenty-first-century condottiero state, and a nuclear-armed one at that. A broke but still militarily strong and audacious country that does the bidding of a rich superpower — for remuneration. Sounds a bit medieval? Perhaps. But isn't it often said that global politics may be entering the New Middle Ages, marked by the ragtag multitude of players, brutal competition, and complex hierarchies?"
"The art of travel hacking is where you take advantage of big sign-up bonuses over by banks for getting approved for their card and meeting various spending criteria over the course of a few months. When successful, you receive a reward that when used correctly, can get you thousands of dollars worth of value. This is how we travel for free on the banks’ dime."
Love these profiles & productivity tips.
"Wealth is, by its very nature, hidden. Morgan Housel explains this in his new book The Psychology of Money. Wealth is income not spent. Being “rich,” on the other hand, can be distinguished as a measure that relates more to one’s current income and how it is spent.
A Lamborghini, for example, is not an ostentatious display of wealth. It’s an ostentatious display of money.
“People are good at learning by imitation,” Housel notes. “But the hidden nature of wealth makes it hard to imitate others and learn from their ways.” [emphasis mine]
We can’t imitate many of the actions that lead to wealth because the most important action that leads to wealth — not spending every dollar we make — is an anti-action. Wealth comes, in part, from the things that we don’t do — the money that we don’t spend. And so it grows in secret.
Yet people try to find all sorts of silly ways to grow wealthy through imitation."
"The 50-year-old industrialist is nothing if not mercurial and contradictory. He may not like the boring parts of the chief executive’s job, but make no mistake: he sure as hell wants to control his company."
No Sh-t! This last 1.5 years have been awful for so many people.
"For a lot of Americans, part of what we’re experiencing is the disorientation of a pandemic that seemed to be on the wane here in the US, then came roaring back with the arrival of delta. “Every time the epidemic curve goes up, especially when it’s variant-related, we just have a new injection of fear,” Lindsey Leininger, a public health scientist at Dartmouth’s Tuck School of Business who also co-writes the advice column Dear Pandemic, told Vox.
We’ve also never had a break from the trauma. Instead of having time to rest and recover from the loss, fear, and burnout, we’re just ... still in it, almost a year and a half later. Indeed, what’s unusual and worrying about the pandemic from a trauma perspective is that “it’s been going on for so long,”
"Despite Wood’s lunatic predictions, Ark’s E.T.F.’s continue to put up impressive numbers as the bull market roars on. The Ark Innovation E.T.F., with $25.5 billion under management, is up 51 percent in the last year, although it’s had a rough 2021 so far, down more than 2 percent, while the S&P 500 is up around 19 percent.
None of this gives her the slightest pause. Her evangelism knows few bounds."
This is good news for the environment & the planet (and humanity).
"Sacca, who became well-known for his early and outsize bets on both Twitter and Uber, was somewhat famously a judge on the popular TV show “Shark Tank” for several seasons before quitting the show — and venture capital — in 2017, saying he had always intended to retire at age 40. (At the time, he was 42.)
Sacca’s growing concern regarding climate change — and his lack of faith that politicians can make a dent in reversing it — prompted him to rethink that decision. As he told Forbes in March: “We think that markets might actually hold the key to unf***ing the planet.”
"If you study the world's greatest investors, you will find that many of them completely ignored all advice about diversification. Going the opposite way led to immense riches, and for quite a few of them, it did so rather quickly."
"If you invest your own money, there is no corporate policy forcing you to subscribe to the latest investment craze. No boss disagreeing with your view, no investment guidelines influencing your decisions, and no compliance department slowing down your decisions.
If you are seeking outsized returns, you will have to put up with outsized volatility. If you invest permanent capital, sitting through a period of volatility won't have to bother you. As an employed fund manager, you are likely to get fired for outsized volatility – unless your investors have given you permanent capital, as in the case of Berkshire Hathaway's shareholders. Being able to invest permanent capital is a HUGE advantage, and as a private investor investing their own money you naturally have that advantage on your side."
"I have a great deal of insecurity and fear that, coupled with the instincts we all have, has resulted in hunger. It can come from a lot of places. I don’t think I was born with it. Understanding where hunger comes from can illuminate the difference between success and fulfillment."
"With appropriate instruction, expectations, and effort, children at all levels can succeed. The success at the bottom of the distribution necessarily looks quite different than at the top, but that is not an excuse to abandon the bottom altogether. Nor should we delude ourselves into thinking we can achieve equal results that look anything like the top half.
But just such nihilism and delusion are pervasive in the system. The test scores crater? Cancel the test. The students can’t read? Tell them they don’t have to! This is no way to run a school system; it’s an abdication of duty. If our education leaders really don’t think they owe our students anything at all, then they ought to step aside for people who do. This won’t happen, obviously, because the purpose of the education monopoly is power, not service to the public."
"Afghanistan is likely to become the next geopolitical quagmire after Syria. It will be interesting to follow how China will navigate this playground, as Beijing is likely to be the next great power to try and fill the void. Perhaps that is exactly why the US is pulling out now—the move could possibly become an American trap if China enters the Afghan quagmire and fails, as the USSR did between 1979 and 1989. Washington seems to have a plan to cause trouble for the newly emerging great power China."
Always a good show. Learning from the edge of the internet.