Marvin’s Best Weekly Reads Nov 13th, 2022
“Courage isn’t having the strength to go on — it is going on when you don’t have strength.”― Napoleon Bonaparte
- Important video on a possible future war with China. They are the enemy, like it or not.
2. If you are a geopolitical geek like me, this is a lively and fascinating discussion.
3. “As with bankruptcy, the sell-off happened gradually, then suddenly. Last week was a turning point. Amazon, Google, Meta, and Snap all missed big on earnings. The common theme? Ads. Or lack thereof. We knew the Mad Men era had come to an end; we weren’t expecting the end of Ad Men.
But let’s be honest, advertising sucks. Cable ads provide a glimpse into what it’s like to have restless leg syndrome, and digital ads, while more relevant, are carbon — the noxious byproduct of converting attention into shareholder value via algorithms that bring out the worst in the species. I’ll say it again, advertising sucks.”
4. “Technology adoption turns hyperbolic during a recession or any major event promoting budget cuts, layoffs, or dramatic changes in the market. Covid-19 was a good example of what this looks like.
So much of the company prospecting process can be eliminated due to automation.
They also clean their CRM data so if anyone changes jobs or changes an email/phone number it gets automatically updated in the CRM. This makes the outreach process more effective due to not wasting time on bad info.
Simple. It’s cheaper to use sales technology than it is to hire more salespeople. When you use sales technology you multiply your sales efforts and decrease management overhead. If you can manage sales reps via software instead of a sales manager why would you hire a sales manager? And if you can get the 2x more results from the current reps you have there’s no need to hire more reps.
The issue is companies don’t know how to use sales tech!”
5. “Let’s accept layoffs as part and parcel of business cycles, amongst many other smart-sounding external factors and mismanagement despite best intentions. It is what it is. They happen! Life is unfair.
What grinds my gears is leadership not owning their difficult decision of laying people off. Again, I don’t consider them bad people for laying off! I do not believe they enjoy doing them.
But, let’s fault them if and when they fail to own the decision and take the necessary steps to minimize the pain, confusion, and uncertainty that inevitably flow from layoffs. The most effective levers for doing so are appropriate communication and post-layoff support to the extent a company’s financial situation allows them to.”
6. “Long story short: if you’re ever expecting to retire, you’ll need to make preparations to take care of this yourself. Nobody else will — especially your government, despite their promises.
So, what’s a person to do? Well, I can’t tell you how you should prepare. That’s not my place, especially considering our unique individual circumstances.
But for me, setting aside at least 10% of my monthly income (though ideally 20%) to be invested into hard appreciating assets like real estate, precious metals, or even commodities is a good start. And if the idea of setting aside up to a fifth of your income for future safekeeping seems like an impossibility, then it may be time to increase your income or earning ability in whatever way you can, as soon as you can.
Just remember: the sands of time wait for none of us.”
7. “So overall the acquisition of equipment has (as it always does) played a major role in determining the war so far. Russian issues in this area and Ukrainian successes have basically helped change what was a war of Russian offensive to Ukrainian counteroffensive. Both sides, however, have major vulnerabilities.
The Russians need to be able to find ways to either produce or acquire equipment to make up for their losses while the Ukrainians need to make sure that their NATO supporters continue on with their aid programs. The real canary in the coal mine here is what happens with the US mid-term elections.”
8. “Intuitively, it makes sense that more entrepreneurial activity in a community is a good thing. Only, it’s important to go up a level to think about why a larger, broader, and deeper startup scene helps the region, especially in the context of a long, multi-decade horizon.”
9. “Please do not lose your income as layoffs will continue through Q1. As a rule of thumb the cuts come in October/November and then February/March for most industries.
This is due to budget setting as mentioned many times here to start the year and Feb/March is another round if they don’t see enough “natural attrition”. Which means people leaving/quitting/retiring etc.
If you want an idea of what the next 12 months will look like, we suggest watching some old Rocky movies. The quiet quitting trend is over.”
10. “To get to simplicity I have to push through distractions, complexity, and lots of hard work but I know it’s worth the effort. I have to reduce everything I’m learning down to its essence to leap forward.
Simplicity is simply mastery, the state of mind and being when you can express yourself in any medium with fluidity, clarity, and excellence, making it seem so easy that anyone can do it without any effort.”
11. This is a worthwhile panel to listen to as a VC.
12. Detroit & Houston are well positioned for the future. In fact, US already well positioned as we re-industrialize.
13. Pretty important discussion here on energy and geopolitics.
14. “But when researchers expanded their definition of aggression to include verbal aggression and indirect aggression (rumor spreading, gossiping, ostracism, and friendship termination) they found that girls score higher on indirect aggression and no sex differences in verbal aggression.
The most common reasons people give for their most recent act of aggression are threats to social status and reputational concerns.”
15. This was a masterclass on Venture investing from one of the best leading the best. So many gems of wisdom.
16. “You always say yes to more responsibility and a promotion. The reasoning is quite simple. If you get promoted your manager and his manager have to “admit” it was a mistake.
This is unlikely. If you get promoted you usually have about a year or so to show results. The only way you get promoted then fired in a month is if there are major management changes in the org chart. Per usual, there are always “exceptions”. Example: never take a promotion to a non-revenue generating role. Stay in the profit centers.
90% of the time? There is no way your boss or the boss of your boss is going to walk up to Senior Management and say “Hey i made a huge mistake already! It has been 3 weeks!”.”
17. “Since 1945 all nuclear powers have refrained from using nuclear weapons because none of them have been presented with an existential military threat against there existence. If Russia were to break that taboo in a war of conquest, it could have dramatic impact on nuclear non-proliferation.
If states around the world see that nuclear weapons can now be used to compel their capitulation to conquest, what would stop Taiwan and Japan, for instance, from developing their own nuclear deterrent. That would be probably the worst possible development from a Chinese perspective.
Likewise, if China believes this era represents that dawn of a new Chinese age, they cant be wild about the prospect of a nuclear weapons use leading to global instability.
So all in all, China probably represents a huge break on any Russian use of nuclear weapons, and the Chinese statement today is real confirmation of that.”
18. Hmmm……
“Musk has accidentally created a public hearing on his reputational and professional worth, where we now will see if he is a great CEO or a rich guy who kept winning until he didn’t. The public will now watch and judge him in real time as he makes the decisions that most CEOs get to make behind closed doors, in part because he can’t help but announce them personally. He cannot post less, because it will show a lack of attachment to the massive purchase he made, and if he posts more, he will be subject to the hyper-attention that made him famous.”
19. “My way of achieving this goal is to scale back on consumption; only buying well made things that last and that I frequently use. This has allowed me to both work less on meaningless projects, having higher quality experiences, and enjoying a nomadic lifestyle. Your dream might be different but the process is the same.
Today we are exposed to an infinite amount of ideas, things, and people via the Internet. And as much as I love this technology, it’s important to understand how it really works and to create your own filters and boundaries for how you use it.”
20. “It’s harder and harder to break those stars today. That’s why labels offer more favorable contracts to keep those artist who are already proven. It’s also why they are eager to find the next superstars from non-English speaking markets that are less saturated. It’s all connected.
This shift is bigger than music. It’s happening in Hollywood. It’s happening in all forms of content and media. But since music is often first to get disrupted, there’s a larger disconnect between expectations and reality.
There are many artists sold on the belief that they can be the next Kendrick Lamar. The challenge today is that even if they have K.dot’s talent and adapt his playbook for today’s era, that merely gives them a chance of success. TikTok algorithms can have artists think that those millions of views on a viral post will translate to millions of concert tickets sold.
The power laws of music are stronger than they are in any other form of entertainment. The platforms, superstars, niche stars, and the companies they work with have all benefited. It’s everyone else that has to catch up.”
21. This explains the bizarre German foreign and domestic policy we see.
22. “As leaders, we would do well to welcome our own humanity and at times even our own frailty. We would do well to invite the humanity of those we seek to lead.
As investors, we would do well to check in with our portfolio CEOs as humans, not simply as operators.
You are not a robot. Neither was Jobs. And that, my friend, is wonderful if inconvenient news.”
23. “We think of war as a battleground involving tanks, troops, ships, and planes. But technology has made it possible for a new battleground involving DNA, cells, organs, and scientists in labs.
The human body is the battleground in an era of hybrid biogenetic warfare. We have a situation now where China is accusing the US of engaging in such warfare. The US is fearing that China might engage in such warfare.”
24. This seems more relevant than ever.
“If you’re going through a rough situation, my advice is stay strong, stay data-driven, leverage the resources around you, and demand the best of your team. Focus on first diagnosing the problem and then on building and attaining a steady-state funnel model to get things back on track.
It may feel like you’re going through hell, but remember, as Winston Churchill famously said, “if you’re going through hell, keep going.”
25. This is pretty damn surprising.
Maybe not, Considering how tumultuous the crypto space has been this year.
26. This is actually a very good idea from a VC fund.
“Her bet? At least 0.1% to 1% of the thousands of employees impacted by tech layoffs this year could become incredible founders.”
27. I think everyone is still shocked here.
“The rapid disintegration of Bankman-Fried’s crypto empire will likely unravel further VC investors’ confidence in blockchain startups, which attracted a frenzy of investor interest last year. And Bankman-Fried was one of the most successful fundraisers.”
28. “When journalists have suspicions about a business, they like to call it a “house of cards.” It’s a vivid analogy that basically means “We can’t tell you what is wrong with the business, but something is.” It honestly irks me when people throw the expression around without doing the work to explain what’s happening, but it is also important to follow one’s instincts.
And for a while now, a lot of people have had a funny feeling about crypto and specifically about FTX, one of the world’s most popular places to buy and sell cryptocurrencies.
Specifically, the thing that didn’t smell right was FTX’s relationship with crypto trading fund Alameda Research, which Bankman-Fried also controlled.
It seemed icky that one of the world’s largest brokers of crypto currency was so close to one of the world’s largest buyers of crypto currencies. Some wondered about that broker’s impartiality given their relationship. But that’s just how crypto works, people said. And who doesn’t want to bet on a young wunderkind? That was a part Bankman-Fried played so well.
No one really asked the tough questions about the relationship, apparently not even the world’s most renowned investors, including Sequoia Capital, SoftBank and Paradigm, which collectively poured hundreds of millions into FTX, valuing the three-year-old company at more than $32 billion.”
29. “First, the economic and military dominance of the Western world is not nearly as overwhelming as it was one hundred years ago, or even fifty years ago.
That dominance is being eroded by the growth of other parts of the world organized according to different principles, and obviously so by China. So if the performance of the liberal capitalist model is inferior to another model, then perhaps democratic liberal capitalism is not the best way to organize the mankind everywhere?
Second, in responding to the challenges of globalization and the hollowing out of the domestic middle classes, a significant part of the Western public opinion shifts to populism, nationalism etc. all the forces that a successful liberal capitalist model should make sure remain marginal. But they are no longer so.
Third, Danny raises the issue: should not our thinking about what is the best way to organize economic and political life be influenced not only by who is doing it most successfully but also by where the majority of the world population lives? It is not simply an arithmetical point. It comes from requiring that the modes of successful life that many people experience do have a greater empirical validity than the ways of successful life experienced by smaller groups of people.”
30. “From a US security perspective its just a no brainer to arm the Ukrainians to take out Russia, and Iranian, military capability. The best bang for buck, quite literally, for the US, and putting zero US lives in danger.”
31. “Now, following a series of missteps — that’s the best-case scenario — FTX didn’t just lose its rich valuation. According to the WSJ, FTX founder and CEO Sam Bankman-Fried told investors today that he needed emergency funding to cover a shortfall of up to $8 billion due to withdrawal requests received in recent days. Reportedly, he has been seeking a mixture of debt and equity.
It’s not surprising that Sequoia decided instead to write off its roughly $210 million investment. Presumably, others of FTX’s investors — including BlackRock, Tiger Global, Insight Partners, and Paradigm — are shooting out their own communications to limited partners about making the same decision.
(The Ontario Teachers’ Pension Plan Board, which invested directly in FTX, has a much broader base of shareholders who may be wondering about their retirement savings, even while their pensions are guaranteed.)”
32. “Russia’s strategy is about suffering: for people, to diminish morale and the population’s support for Ukraine’s war effort; and for the economy, to crush it so that Ukraine can’t meet the needs of its people and is even more reliant on the West — a West that is also dealing with cost of living, inflation, and energy crises as winter approaches.
The strategy is cruel, but, as experts pointed out, so far it has failed to do anything more than harden attitudes against Russia. And it has not, at all, boosted Russia’s fortunes on the battlefield. “Despite that massive wave of terrorist attacks that [Putin] just recently did, he’s still losing ground,” Spencer said.
Russia retreating from the city of Kherson may also help make Ukraine’s case that its strategy of retaking Ukrainian territory and expelling Russia is the right course. As Menon said, “it’s a big morale boost,” even as Russian and Ukrainian troops face fiercer and more critical battles in the east.
It will likely also bolster Ukraine’s case to the West that it can possibly win those battles if it can just get more Western military support, including advanced weapons and air defense systems to protect against Russian barrages targeting infrastructure. “They also have a very strong card to play, which is: you’re supplying us — but we’re delivering, we’re showing we’re capable of winning,” Menon said.”
33. Great Discussion about FTX from the NIA guys.
