Marvin’s Best Weekly Reads March 28th, 2021

  1. “So as we are watching this all play out, investors are fearful of inflation. They aren’t going to wait for inflation to occur before they act. They’ll front run the inflation. They will move capital into inflation-hedge assets. And those inflation hedge assets will continue to rise.”

2. This looks like a cool place. Will have to check it out.

3. “Instead of focusing so heavily on content expansion, creators and publishers need to be thinking about building features they can provide their most loyal customers — the subscriber. The goal should be to have subscribers identify directly with the creator and feel invested in their work. They should feel value in the environment the creator is building outside of the content itself, through community, collaboration and participation. These features and tools should enable that, which makes loyalty and retention as a functioning utility vs. a sentiment.”

4. “The best way to scale these technologies up quickly will be to directly speed-up large-scale adoption. That means massive government investment in solar and storage. Carbon taxes will be much less effective, since their effect is diffused through all sectors of the economy rather than focused on the key areas, and since carbon taxes are partially a degrowth policy in addition to an adoption incentive. Similarly, policies to intentionally limit economic growth will be actively counterproductive.

Green growth — intentional rapid mass adoption of renewables — is America’s best shot at saving the planet from catastrophic climate change, because it’s our best shot at actually getting China and other countries to decarbonize. It’s also fair, because it minimizes the sacrifices that developing countries will have to make. And it’s likely to be far more politically acceptable to the American people than high carbon taxes or degrowth policies.”

5. “In an industry roll-up, you acquire and merge multiple smaller companies into a large company. If you have chosen the right industry and the right acquisition targets, a roll-up allows you to:

— Cut costs by pooling resources.

— Become more competitive.

— Benefit from so-called “multiple arbitrage”. Smaller firms tend to be offered for a cheaper valuation, whereas the stock market values larger, growing firms at higher multiples. In theory, with each acquisition, the valuation of a publicly-listed consolidator should leap forward.

It’s a neat strategy if you can find the right industry to apply it to. Most industries already have a significant degree of concentration, and there are simply not enough smaller targets to acquire.”

6. Tanzania is a growth star in Africa.

“There is a huge domestic market with a population of nearly 60 million, two-thirds of whom are under 20. Population growth is over 3% a year. Dar es Salaam, the commercial capital and major port city, is projected to be among the largest urban areas by population anywhere in the world, during our lifetimes.

There is great potential and much to be positive about, but, as ever, the execution risk is massive. “This is Africa,” as they say.

As I have often said, the perception of risk is often much higher than the actual risks of investing in Africa, which has much to offer.”

7. Routines are critical for nomad capitalists. Always interesting to learn about other folks.

8. This is quite a good discussion on what’s happening in Venture Capital these days. It’s cray cray competitive which is great for founders and death for most of the traditional undifferentiated VCs.

9. Alexander Tamas is the secret weapon behind DST’s success. Incredible investor.

“Cross-border foresight can also be very important, as the history of technology is playing out in different geographies at different speeds.”

10. This is a smart kid. Alot of the knowledge, opportunities & tools available now did not exist 20 years ago.

“Your goal should be to reframe how you approach traditional investment returns. Effectively split your investments into 2 buckets. One, the traditional path designed as retirement savings. The other, your angel portfolio that you’ll use over the next 5 to 10 year period to reinvest profits in yourself.”

11. “Bitcoiners are conducting an information insurgency.

They are quite literally controlling the public narrative through an overwhelming amount of content that has no reliance on traditional distribution methods. Up until recently, the only time that journalists or television shows wanted to speak with bitcoiners was to ridicule, mock, and attack them.

The bitcoin community ignored those short term challenges and instead built a direct relationship with the mass population. Twitter. Reddit. Telegram. Podcasts. Instagram. Facebook. Email. You can’t exist on the internet for 24 hours without coming in contact with content that is created by this community.”

12. “Looking back at history, we see that general-purpose technologies often take a long time to start lifting productivity by measurable amounts. The reason is that when new technologies appear, you can’t always just swap them out for existing ones — you often have to entirely reorganize your systems of production around the new technology, and that’s a difficult and expensive process.”

13. Rally (and all the others listed) is an AMAZING business and I wish I had discovered them earlier so I could have invested in them. This is the future.

“Rally is a platform that allows people like you and me to invest in partial shares of high-value stuff. Rally started as a place where investors could purchase shares of rare cars, before moving into art and watches. Now, it’s ramping up its sneaker offerings with these Kobe 2s, along with more: a pair of Air Jordan 6s game-worn and signed by Michael Jordan himself; shoes Zion Williamson wore in action; and a 1972 prototype of Nike’s Moon Shoes.

What all these investment vehicles — Otis, Rally, WatchFund, Robinhood, cryptocurrencies and NFTs more generally — have in common is a stated desire by their founders to level the economic playing field. For decades, only the wealthiest people have been able to play the stock market, buy a rare watch worth tens of thousands knowing its value would only rise, or treat a collectible item like a painting (or a sneaker!) like an investment opportunity.”

14. This seems like a very interesting way to buy farmland. Acretrader, Tillable, FarmTogether & Harvest Returns are taking different angles to this.

15. “So while China’s government is popular within China, it is extremely unpopular among most of its neighbors, developed and developing alike. The Russians are a big exception, of course (and maybe Pakistan too, though I can’t find a poll). But if China is going to supplant the U.S. at the center of the global order, or even just the regional order in Asia, it’s going to need the approval of countries like India, Japan, Vietnam, and Indonesia. Currently, it just doesn’t have it.”

16. The things people do for free sushi!

17. Beyonce’s content strategy: very good stuff.

“Every content creator should have a funnel. It’s a living document that changes over time. In today’s content landscape, there are plenty of tools to segment your audience to do the same. For many folks starting, social media is their best opportunity to reach the masses.”

18. “It is through the transitive property of trust that companies and employees can share audience members. Once an employee builds a trusted relationship with an audience, their followers are more inclined to trust the individual’s employer. After all, the choice of where to work is not a decision most people take lightly. When an impressive person shows their dedication to a company, it signals to audience members that the employer must be impressive as well.

As the brand gains prestige through its public-facing employees, it can distribute the status back to its employees in the form of a virtuous cycle. This is the magic of a strong platform brand.”

“Rather than building skill-based career moats, workers of the future may be using their audiences to secure permanent employment.

If this turns out to be the dominant strategy, many younger workers will start looking for opportunities that enable them to grow their following.

While some individuals will still want to build audiences on their own, many will opt to gain legitimacy and investment by partnering with an employer who can help them grow their reach and status.”

19. Nobody likes change. But Goldman Sachs always seems to end up on top.

“In many ways, it should all be sunny at Goldman Sachs: Its Wall Street businesses are booming, the stock is on a tear and the bank finally put to rest the 1MDB scandal that dogged it for six years. Instead, the firm is riveted by palace intrigue over executive defections, bristling over the use of company jets for personal trips and debating how flexible the workplace will be after Covid subsides.”

20. For those who don’t know what a SPAC this is a good discussion.

“Prominent companies like DraftKings, Virgin Galactic, and OpenDoor have all used SPACs to go public.

But SPACs — which are generally subject to less regulation than IPOs — have also drawn controversy for the risks they pose to public investors: earlier this week, the investment bank UBS banned its financial advisors from recommending SPAC stocks to clients.

What exactly is a SPAC? Why are so many companies choosing to go public via SPACs in lieu of a standard IPO? And how beneficial are they to businesses and investors?”

21. “Clean air is now the ultimate luxury, and the business proposition rests on turning a commodity we’ve never had to pay for into a premium -product. But hovering over Molekule and the rest of the purifier industry are questions coming from university labs and consumer–product testers: Do these things actually work? And how much should clean air cost? Molekule and other manufacturers would put the question back to you more urgently: Just how much is your next breath worth?”

22. “A scene is essentially a collection of purpose that everybody has agreed to and that’s why they’re there. And that’s why they help you get into those mindsets. That’s why scenes actually accomplish all these interesting, creative things.

These human behaviours about how scenes work and how this jockeying for status and competition and half working together, but also half being wary of each other is a generally reproducible rule about how people behave in general in situations where people’s status and worth and presence and value is expanding rapidly, but also very indeterminately.

The startup scene is almost indistinguishable from a music scene. It is virtually the same thing. Bands are like startups, record labels are like VCs. You have the press and the whole mechanics of telling people about things is virtually indistinguishable from the Techcrunches and the Twitter presences of the world.

But ultimately what matters is that it’s a hits business. Nothing matters until you get a hit, even if it’s a small hit. And then once you do, your life changes and everything revolves around this idea of figuring out how to preempt who is getting these hits and why, and that’s how everything organizes. And so the elements that contribute to these scenes, which are the terroir for hits happening, like the floor plan of CBGBs. This is where art comes from. This is where creativity comes from. This is where new comes from.”

23. It happens……

“Never before had Puritan, founded a century ago in the tiny town of Guilford, been more important. And never before had it been so dysfunctional. A yearslong feud between the two owners, Templet and his cousin John Cartwright, had left the business in a management crisis.”

24. I really like these! Building your personal competitive advantage.

25. “There is a playbook for success as an influencer and I believe it is a skill that can be taught,” Venz Box says. “Let me say ‘skills’ plural, that can be taught. To succeed you have to be a polymath — you need marketing skills, business skills, performance skills and creative skills.”

RewardStyle isn’t as difficult to get into as Harvard, but it is close — according to its spokesperson, hundreds of thousands apply every year but they only have approximately 100,000 registered influencers, among them Molly Sims, The Home Edit, Studio McGee, Aimee Song, Louise Roe, Nastia Lukin, Kristen Taekman and Tayshia Adams. The application involves a review of a potential influencer’s social media feeds — examining their audience engagement, their aesthetic, how often they post, what kind of an audience they reach and whether their content is “shoppable.”

26. Not sure why this is a big surprise as I think most billionaires do this. You want your people in power.

But this also shows the eternal nexus between money and power that has existed throughout human history.

“The donations are the latest display of how Thiel is cultivating a network of young, populist, Ivy League-educated proteges and encouraging them to run for Senate all around the country.”

27. “Just look at the kind of coin and you know how much it’s worth because everyone else agrees to accept that coin too. It changed the world and the way we run our civilizations.

But the time of analog money is passing and passing fast.

Digital technology is infinitely more flexible and it will let us take money in a thousand new directions we’re only beginning to imagine now.

Tomorrow’s money is smart money.

Just as digital cameras have replaced their analog counterparts, so too will digital, programmable money replace plain old paper money.”

28. “It’s a textbook example of a rational action in response to monetary inflation. Can we agree that the money supply is expanding in an unprecedented fashion the past 12 months everywhere in the world? If you’re going to make a rational investment decision today, whether you’re a real estate investor, a stock investor, a bond investor, or just a wage earner or you’re a treasurer, you have to estimate the rate of monetary expansion for the next eight years. We know there’s a commitment to run deficits, and we know this commitment to stimulus.

So now the issue is, What’s a rational behavior? I’ve got to find a store of value.”

29. This is a very deep discussion. I had to listen to this half speed to understand it (not sure I have either). So much here.

30. Thanks to the ever continuous & badly thought thru long downs. The almost 1 year lockdown in California (and other Democratic ruins states) will be considered a crime against humanity many years from now. (and FYI: I voted and am actually a Democratic but maybe not for long if things continue)

“More than a year into the pandemic, people have become accustomed to the lives they’ve built and the routines they’ve created in isolation at home in their “Covid caves.”

“The pandemic has already taken a mental toll on Americans. As of June 2020, nearly 41% of adults in the U.S. had reported they were struggling with mental health or substance use, with 31% reporting symptoms of anxiety or depression and 26% reporting trauma or a stressor-related disorder related to the pandemic, according to a survey by the Centers for Disease Control and Prevention’s Morbidity and Mortality Weekly Report.”

31. This is SUPER smart. VC fund with influencers as their LPs and supporters. As good as a win-win for all parties & major value add for their consumer portfolio cos.

32. Geopolitical Anarchy is here.

“By dismantling physical and informational barriers across the globe, the basic capacity of states to provide security for their citizens has become weakened, perhaps fatally. By eroding the lines between home and abroad, postmodernity has globalised conflicts, and eroded even the very distinction between war and peace. Instead of perpetual peace, it has ushered in an age of perpetual anarchy that states are finding themselves powerless to contain.

Drone, camera and social media sharer thus become a single, integrated weapon system, a hybrid semi-autonomous proxy as useful and as cheap to operate as the expendable proxies fighting on the ground.”

33. “As we transition from the industrial age to the information age, and now the digital age, the lifestyle operating systems of happy people are changing. And as we move deeper into the digital age, we will see a fragmentation of society along an infinite number of cultures.

But governments will continue to experience a slow stagnation as their constituents fragment along a growing number of lifestyle preferences. This will force governments to adapt policies to support the growing number of lifestyle preferences in their communities.

This adaptation reinforces the rise of the Sovereign Individual. As governments fail to adapt to changing preferences, individuals will move to locations that better suit their ideals. Supported by remote work and the tech-enabled exit, we will see a large scale reshuffling of people moving to communities that support their belief systems. The change will be slow at first but then will advance rapidly. And we are already seeing an example of this reshuffle of communities take place referred to as the “purpling of America”.

34. “If you knock it out of the park on day one, you should just quit. It is clear that you’re an anomaly. If you’re in the second camp and it takes you 5–8 years to really figure things out, you should take a calmer approach to your decisions. If it took you 5–10 years to figure it out, there is no reason to leave your career if you haven’t taken your foot off the gas. If you’re a middle of the pack employee you’re actually important to a company. Anyone who is generating operating profits for the firm is an asset. You just want to find a way to improve your operating margins while reducing your time.”

“The only reason you should quit entirely is if you’ve knocked it out of the park or your career is hindering your side income. This is quite rare. If you’ve successfully built something over 5–10 years, is much more likely that dedicating 2–3 more hours will lead to more income. So you’re already increasing your exposure to your side income without giving up the steady pay check.”

35. I find it very hard to be sympathetic here.

This is what Investment banking is notoriously known for ever since the 80s & am surprised they are surprised. (well not surprised because most people don’t do their homework). This is what you signed up for to make what you make!?? This upcoming generation is so WEAK!

36. “In recent years, sneakers have become an asset class like stocks, bonds and cryptocurrency, becoming a multibillion-dollar market worldwide. They trade on a variety of reseller platforms; the best known include StockX, GOAT, Flight Club and Stadium Goods.

The marketplaces like to promote their extensive authentication processes so that buyers know that the items they end up with are the real deal.

But such efforts don’t get at how the sellers acquired the shoes, and that’s what is stirring up sneaker fans who don’t think they’re getting a fair shot at buying newly released products.”

37. I will have to say, it does work. Cold showers are powerful.

38. Incredibly insightful presentation by THE Balaji S. Srinivasan…..The rise of the Network State. So much to take in here but the future looks bright (for some tech savvy folks at least).

39. About bloody time. America has been asleep at the wheel and forgotten about the critical piece of supply chains (not just for semiconductors). This review is only the start of what needs to be done.

“Biden’s review won’t just look at the US supply of semiconductors. Over the next two months, the administration will also look at America’s manufacturing abilities for pharmaceuticals, high-capacity batteries, and rare-earth elements that are found in everything from lasers to electric vehicles. There’s also a broader, year-long review of sectors ranging from food and energy to transportation. The ultimate goal, the president said in February, is “making sure the United States can meet every challenge we face in the new era.”

40. Portugal represent! Big round for Feedzai.

41. “Investing is directly linked to money and also to status. So it’s no surprise that every generation creates its own investing platform in response to its unique relationship with status. In a purely offline world, a game of golf with your Merrill Lynch broker cuts it, but that doesn’t work in an online world where followers count.

In this framing, ETrade was simply the stepping stone between Merrill Lynch and eToro. It provided the means for users to accumulate wealth but it didn’t vertically integrate that into status. ETrade’s marketing tagline in its 2000 heyday was “It’s your money.” Contrast that with eToro’s: “Trade like Steve.” One’s solitary; the other is social.”

42. This is smart. Leveraging their brand for ownership.

“Creative Juice initially will focus on valuing and buying minority stakes in YouTube channels and supporting creators with mentorship. It’s part of a growing trend toward platforms aimed at meeting the financing needs of the creator economy by offering investors the chance to buy into creators’ future earnings in various forms.

Equity-based investment models for individuals are gaining momentum. A variety of companies oriented toward income-sharing agreements, particularly in the education arena, have emerged in the last several years. Meanwhile, companies such as Pando Pooling offering income-pooling products, which allow young baseball players and MBA students to pool together for a share of their future earnings, are gaining acceptance as financial products.”

43. “One misconception about creators is that they’re just seeking fame and fortune. The same survey of today’s youth showed that “Creativity” is the top-rated reason for wanting to work as a creator, outpacing celebrity and money. Being a creator is a form of self-expression.”

“The creator economy is broader than entertainment and it’s broader than consumer — it’s about people being able to use technology to build in new ways, and then being able to use the internet as distribution to share and monetize those creations.”

“The internet levels the playing field, and anyone can use their hustle and savvy to amass a following and monetize that following. In a time when American capitalism is broken and when the rich get richer, the internet actually resembles something like a meritocracy.

We’re just at the beginning of this shift — work will continue to disaggregate and the next generation of entrepreneurs will be “solopreneurs”.

44. Whoops……

Titanic Taiwanese ship could be stuck in Suez Canal until mid-April

45. “Aella herself ranks in the top 0.8% on OnlyFans, and in her best-performing month last year made $103,000. Others on the site may make very little, despite posting lots of content. This extreme asymmetry in who benefits from a platform eviscerates everything except the very top of the curve. I think of this dynamic as Aella’s Law — and over the past year, largely thanks to Covid control measures, it has made rapid incursions into real life.”

46. This is too bad. I really like Medium and hope they can turn it around. Also shows how VC probably is not the right fuel for most media startups.

“Medium entered the year with more than 700,000 paid subscriptions, putting it on track for more than $35 million in revenue, according to two people familiar with the matter. That’s a healthy sum for a media company. But it represents a weak outcome for Williams, who previously sold Blogger to Google and co-founded Twitter, which eventually went public and today has a market capitalization of more than $50 billion.

Medium has raised $132 million in venture capital, but its last funding came in 2016. Williams has been funding the company out of his own pocket since then, sources said.”

47. “The market is undeniably hot, but that doesn’t mean a majority of rounds get done overnight — far from it. “Dry powder”, the capital that investors have at their disposal, is always less than the number of startups looking for funding. So when established players say they’ve never seen such a busy market, they’re right — but there have also never been so many great startups to fund.”

“The truth is that the scene of early-stage funding has shifted, and very few funds want to invest in rounds ~1M€. So you’ll likely get quite a bit of enthusiasm right away, because they do invest those amounts in pitch decks, but only with people they can “trust” because of their existing relationship, track record or someone else’s trust. So a few weeks later, you’re likely to be sitting with a lot more No’s than your first impressions suggested.”

48. On Deck is the future of education. Super bullish and love what they are doing.

“On Deck is building a modern, digitally native education platform at a fraction of the time and cost of traditional higher and continuing education.

Over the past year, On Deck has done something insanely hard: scaled community and education, online, profitably, while growing revenue 10x and building out a platform on top of which it can launch new products and integrate acquired ones such that each is a desirable standalone offering that connects to and strengthens at least one other part of the ecosystem. If that’s a lot in one sentence, that’s because On Deck has done a lot.”

49. “This is the future. The technologists are in charge. They are innovating at a pace that the nation states can’t keep up. We have digitized financial markets, which shifts the power dynamic. The regulators and former owners of the system are now rendered less effective. This is a net positive. It moves us closer to a free market. Free markets lead to more innovation. What a time to be alive.”

50. I’m such a big fan of Argentineans & the country (the continually destructive government there, less so).

“Since mid-2020, major agricultural price indices have surged by over 40%. Prices are now at their highest level since 2013, and some predict there is more to come.

One of the biggest beneficiaries? Argentina, the country that makes 70% of its export income from agricultural products.

Is now the time to pile into Argentinean assets at vastly discounted prices?

The surge in global food prices can be a powerful catalyst for Argentina, if the trend continues — as many believe it will.”

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Marvin Liao

Marvin Liao

Ever curious: Tsundoku, Reader, Aspiring Shokunin, World traveller, Investor & Tech/Media exec interested in almost everything!