Hi All,
This week is a different week than most other weeks. I’m generally one of those people who support silently from the sidelines but enough is enough. This is not the America that I dreamed about when I was a kid, that I came to, to work hard and have a great life. This is not the American dream. A moment of silence for George Floyd #blacklivesmatter
It doesn’t take too much to have some basic empathy … My neighbors (whom I posted about a couple of weeks ago) has now put a little table outside their door and are offering chocolates as a token of gratitude for the delivery folks. Now that is a nice touch! I hope each of us can think of how we might help in our own small way. As always, I hope you enjoy reading and if you did, I’d appreciate you sharing this with someone else that will enjoy reading this.
On fashion
Who'd have thunk that face masks would be a fashion thing in 2020 but yet here we are ...
On equity by use case: An interesting thread on unbundling equity. There have been similar exercised with unbundling debt for specific use cases and Alex Danco has written a lot about this in his article “Debt is coming”
This unbundling of equity is coming. Expect an explosion of new financial products that take on specific risks (vs a bundle) increasing optionality that are cheaper and better aligned. Equity will get pushed back to what it was always meant to underwrite: unstructured risk
On COVID surcharges (which I think are pretty fair right?)
On mobility:
This Nexar blog showed some interesting patterns for mobility. Miles are coming back …
On weird laws :
Just turning your phone on qualifies as searching it, court rules and Grandmother ordered to delete Facebook photos under GDPR. On the 2nd one I wonder if it's fair on the child even if the parent posts the photos? I mean would your child want all their privacy ruined because you wanted to share their photos? How would they remove such photos if they wanted to. It is kinda scary for the next generation of kids growing up now. Thoughts since I am not a parent?
On plain weird!
Talking about weird here is one man's experiment of being secluded from it all for 4 weeks. I don't know if I can ever do this and how it would change me. What's the longest you have been alone without any human contact (direct or indirect?) A day or two max? Can we escape from information overload? | 1843
Did you know? Pigovian tax (from wikipedia)
A Pigovian tax is a tax on any market activity that generates negative externalities. The tax is intended to correct an undesirable or inefficient market outcome, and does so by being set equal to the social cost of the negative externalities. In the presence of negative externalities, the social cost of a market activity is not covered by the private cost of the activity. In such a case, the market outcome is not efficient and may lead to over-consumption of the product. Often-cited examples of such externalities are environmental pollution, and increased public healthcare costs associated with tobacco and sugary drink consumption. In the presence of positive externalities, i.e., public benefits from market activity, those who receive the benefit do not pay for it and the market may under-supply the product. Similar logic suggests the creation of a Pigovian subsidy to help consumers pay for socially-beneficial products and encourage increased production.Wikipedia
COVID-19 reads this week:
Scenarios for a COVD-19 future.
This presentation breaks up post COVID-19 into 4 scenarios and some interesting speculation and scenario planning
A great read on how the whole world is using tech to track and combat coronavirus - contact tracing and smartphone data, wearables and apps, thermal scanning, facial recognition and other AI : The technologies the world is using to track coronavirus — and people
As the economy starts to open we create more jobs that didn't exist before
Coronavirus Jobs: New Era Brings Scanners, Tracers and Sanitizers
Coyle Hospitality Group -- whose typical business is employing independent contractors known as mystery shoppers to rate customer service -- now plans to hire several thousand “social distancing ambassadors” over the next few months, said President Jim Coyle. Those workers will visit businesses such as hotels and restaurants to review standards for safety measures such as distancing and wearing masks and gloves.
This week’s chart from PEW
This week’s dozen:
An uh well EPIC set of reads from Matthew Ball on the EPIC ecosystem and flywheel. Lots I didn't know about gaming and definitely a worthy use of time if you are at all interested in gaming. This is a long 6 part read
The Epic Games Primer: Parts I-VI Directory — MatthewBall.vc
This read from Ranjan Roy from The Margins on Doordash and arbitrage was phenomenal. I cannot believe that this happened! Seems surprising/shocking actually that Doordash would run an experiment like this : Doordash and Pizza Arbitrage
If someone could pay Doordash $16 a pizza, and Doordash would pay his restaurant $24 a pizza, then he should clearly just order pizzas himself via Doordash, all day long. You'd net a clean $8 profit per pizza [insert nerdy economics joke about there is such a thing as a free lunch].
I guess I have never fully realized the potential of TikTok, I had always been hesitant to use the product because of the rumors of them being spyware. I don’t know if that's true (and I still didn’t create an account or post) but his read on TikTok was super enlightening and I was intrigued. The product is truly magical and the 15s limit on videos, such as this one makes this a truly compelling product : The Rise of TikTok and Understanding Its Parent Company, ByteDance
Content on TikTok is very short - originally 15 seconds, and now up to 120 on Douyin in China. Short video is optimized for mobile by default, and naturally leads to a very different product DNA than long video.
On love and spreadsheets : Using a spreadsheet to track and measure who you should marry? I thought this was super weird. I have done such a spreadsheet to evaluate jobs but a partner?
Between the spreadsheets | 1843
Jacob is just one of a growing number of people seeking inspiration from business schools rather than poetry in the quest to find the right partner. This hard-headed attitude is evident in the practical turn that romance’s ardent lexicon has taken in recent years. We look for partners, not soulmates. We avoid deal-breakers. “Are you in the right headspace to receive information that might hurt you?” reads a recent meme, advising people to ask loved ones for consent before making demands on their emotional labour.
Writing is hard. Good writing is even harder. Here is a list of tips (lots of them writing tips) from David Perell : The Best of David Perell: Big Ideas From His Last 3,000 Tweets
Podcasting as we know it is dying : The End of Podcasting's Innocence
This means Spotify now has a free music service, a paid music service, a podcast player, exclusive podcast content, written content (The Ringer’s website) — and perhaps a video service, in the form of video podcasts (at least to start). Oh, and an ad network. The leverage is growing, alongside the market and the userbase.
Thoughts on building breakthrough products : How to build a breakthrough - Mike Maples, Jr.
The future doesn’t happen to us; it happens because of us
The future is not like the weather. It doesn’t just happen. People make the future. It’s not a destiny or hope; it’s a decision.
Steve Jobs didn’t “discover” a market need for smartphones or tablets: He designed the category and taught us how to think about it.
Elon Musk did the same with electric cars and commercial space travel.
So, how do legendary people make the future? How can you be a legendary builder of a breakthrough idea? That’s where Backcasting comes in.
Brilliant read on the 4 functions of markets: interfluidity » Four functions of markets
Building moats. I’m writing an article on this inspired by the below read : Mind the Moat, a 7 Powers Review – Florent Crivello
Moats are those barriers that protect your business’ margins from the erosive forces of competition. It doesn’t matter how revolutionary your product is: even if it literally changed the face of human civilization, you’re going to get nothing for it if anybody can sell it too, arbitraging profits away. The whole surplus of the revolution will go to the consumer, and none to you. Charlie Munger phrases it this way:
Silicon Valley tends to reduce moats to network effects. But a simple look at Fortune 500 companies will tell you that there exist some other very powerful moats out there. The success of commodities sellers like Kraft Heinz, Procter & Gamble, or the Coca Cola Company has certainly shown me there was a gap in my understanding of them.
Thoughts on the future of education from Scott Galloway : How Coronavirus Will Disrupt Future Colleges & Universities
Not education. It’s credentialing. The most value-added part of a university is not the professors; it’s the admissions department. They have done a fantastic job creating the most thorough and arduous job-interview process in modern history, between the testing, the anxiety, the review of your life up until that point, the references you need. If I’m applying for a job at New York Magazine, I’d give you a list of references and you’d call them. You don’t ask the references to write a two-page letter. Universities now do background checks to see if you’ve ever had a DUI or been accused of a crime. They look at your social media to see if you’re abusing alcohol or if you’ve made racist or bigoted statements. We’re screening people like crazy.
When you go to Penn, you know that your classmates are solid citizens who are qualified and have good EQ [emotional quotient]. There is an opportunity for new companies to figure out testing and research methods to certify people around certain skills or EQ. So far, no one has really come up with the ability to certify to the same extent that universities do. To a certain extent, Google, Apple, Amazon, and Facebook are also in the business of certification. If you get a job at Google, there’s a certain belief that the HR department has vetted you enough to certify that you have very strong skills. There will be opportunities in certification that aren’t universities.
Thoughts on the Metaverse : The Minimum Viable Metaverse
Pay cuts vs job cuts vs both? What is the right balance to strike?
This is an interesting read (Pay Cuts Become a Tool for Some Companies to Avoid Layoffs) I think about this situation and it's a very hard one. Would I prefer a pay cut v/s being completely laid off; I don’t know but I think very much that I’d rather earn less money than no money at all. However this a16z article gives the following advise:
One last thing based on some comments from draft readers (HR pros, CEOs, etc.): What about pay cuts instead of, or as a part of, layoffs? This sounds good in theory and often helps the team in the short-term feel better about sharing the pain collectively, but it has side effects. First, your financial analysis will tell you it does very little to reduce your cash burn unless your company has hundreds of people (then it is worth considering, as it may save some roles from being impacted). If you only do 10% or 20% pay cuts, it doesn’t materially impact the overall weighted cost of a full-time employee. Second, it risks hurting morale significantly. Within two or three pay periods, when people start to see their reduced paycheck, they will often start to look elsewhere for work (assuming they can, otherwise they’ll just be annoyed). That said, for founders, executives, the broader leadership team, and people making over a certain amount of money, pay cuts can be an important symbolic gesture. In those cases, I’m supportive of pay cuts — but the gesture is generally symbolic — it’s not really saving meaningful amounts of money. For individual contributors, or people paid less than a certain amount, it’s not worth doing pay cuts and I would absolutely exclude those individuals if you plan on enacting any pay reductions.
Thank you for reading, stay safe, be well!