Marvin’s Best Weekly Reads November 12th, 2023

Marvin Liao
20 min readNov 12, 2023

“It is not the strength of the body that counts, but the strength of the spirit.” ― J.R.R. Tolkien

  1. “Everyone thinks they are being discriminated against and that the world is “unfair” to them.

Instead of wasting your time complaining about reality, just recognize reality and play accordingly.

At the end of the day, the buyer determines the value, not the seller.

If you are selling a house, you cannot complain that “people should not care about the broken walls and leaky roof”. The buyer decides what he cares about in the house he buys.

In life, you are selling yourself and you have to go work on what the buyers consider valuable. It’s that simple.”

2. “Instead of underwriting to the idea that some other investor will understand these companies and mark them up, we find ourselves underwriting increasingly to at least one of two other things: (1) breakeven and/or (2) our own convictions. Either a company has a path to get to sustainable growth on its own or it has the ability to achieve milestones such that we ourselves will be able to continue to support them in their growth path — with or without other investors.

Unlike Sam, however, we are not completely convinced that the venture factory is completely shut down. We do continue to occasionally find a company where we think the next step is likely a traditional Series A. It’s just that we increasingly find ourselves backing companies that are building optionality around other pathways to success.

I want to be crystal clear: we remain convinced that now is the best time in recent memory to build a large multi-billion dollar business from the seed stage. That is why we are here — and we continue to see companies that meet that bar. What has changed is not the scale of potential outcomes. What has changed is the way the pathway from seed to huge exit might look. The whole entrepreneurial journey will be far more artisanal and less factory-like.”

3. “Understanding the average net worth by age and how it changes is more than just a financial exercise — it’s also a way to gauge your financial health in the context of your peer group. While the average net worth figures shown above can be skewed by outliers, looking at the distribution of outcomes — and particularly the median — can offer a more relatable snapshot.

Regardless of whether you are at the 25th percentile or the 90th percentile of the wealth spectrum, it’s crucial to remember that these are just benchmarks. Your financial journey is yours alone and will be influenced by a variety of factors such as career choice, inheritance, and luck.”

4. Xi has squandered China’s potential. Well, kind of like the political class in USA but much worse.

“In less than five years, the Party has hobbled industries that once supplied tax revenue, jobs, inspiration, and global stature. For a generation, the Party found ways to put practicality ahead of ideology. “It doesn’t matter if the cat is black or white,” Deng said, “as long as it catches mice.” In the Xi era, that principle has become, in effect: It doesn’t matter if the cat catches mice, as long as it’s red.

For all of China’s ambitions to greatness, it faces a consuming struggle to restore the trust and vigor of its own people. The stagnation could pass, as it did for America in the nineteen-eighties, or it could deepen, as it did for the Soviet Union during the same years.”

5. “There is no chance of a rate cut any time soon. As long as unemployment is below 5% or so, there is absolutely no shot of rates being cut. Also. If you look at the commentary he says “over the coming quarters” this suggests the fed is planning to keep rates elevated or even raise them if they don’t get the results they want.

All year we’ve basically said the same for the majority: 1) short term t-bills for your future down-payment and 2) crypto on the other side BTC/ETH ($25Kish and $1,600ish as proxies).”

6. I don’t agree with this guys views on Ukraine or his generally anti-Pax Americana view. BUT he has a very good view on global macro.

“And the end game, when yields get too high, is for the Fed to end all pretence that the US Treasury market is a free market. Rather, it will become what it truly is: a Potemkin village where the Fed fixes the level of interest at politically expedient levels. Once everyone realises the game we are playing, the Bitcoin and crypto bull market will be in full swing.

This is the trigger, and it’s time to start rotating out of short-term US Treasury bills and into crypto. The first stop is always Bitcoin, then Ether, and finally my beloved shitcoins. I’ll start small in case I’m wrong, but you can’t sit on the sidelines forever waiting for the perfect setup. The perfect setup is usually staring you right in the face, and you are just too preoccupied with the past to notice.”

7. “We won the first Cold War. And 2022 was a good year for the U.S. and its allies — we set Russia on the back foot in Ukraine, while China’s economy was weakened by Xi Jinping’s mistakes and by the contradictions in its system. But the authoritarian powers — or the continental powers, or the New Axis, or whatever you want to call them — are not out of the fight.

The expansion of proxy conflict to the Middle East, a region where the U.S. lacks strong dedicated allies and moral authority, is bad news, because it threatens to bog American resources and attention down in a conflict far away from the all-important theater of Taiwan and East Asia.

So I think the framework of Cold War 2 isn’t just a useful way to make sense of the blizzard of news right now — it’s a reason for alarm, and for getting serious about addressing the external threats. This is not a situation in which our usual political divides and ideological differences should take precedence.”

8. “If you haven’t fundraised before or your last fundraising experience was in the Good Times™ of 2020–2021, expect to have a very different experience than what you’ve read about or previously experienced. VCs are still looking to cut checks, but they’re slower moving and more cautious than during times of heightened activity.

Be prepared and stick to the basics. It might take extra work to overcome their inertia, but if you come correct you’ll get the result you’re looking for.”

9. “Part of the premise for the rise of seed VC funds in the late 2000s was that cloud computing, other technical innovations, and lean startup thinking meant that startups could get to validation points earlier. Many articles were written about how we would see a generation of capital-efficient startups that would do more with less as a result. This capital-efficient ethos never really took root as it happened to coincide with an unprecedented explosion in the venture ecosystem’s access to capital and historically low interest rates. There was no need to be capital-efficient in an era of capital abundance.

With the era of capital abundance coming to an end, the stage might finally be set for the era of the capital-efficient seed stage company. Seed-stage startups are likely to confront a world in which raising Series A rounds of investment remains difficult for quite some time. There will be a premium on execution and doing more with less capital. The necessary pieces might finally be in place to push companies back toward the hoped-for levels of capital efficiency.

There will be money for our very best companies. However, This change opens space for us to look at companies where a seed and pre-seed round will give the company the money it needs to become a high-growth company with minimal go-forward external capital needs. This is not about finding small, break-even companies that don’t build to scale. This is really about making sure we find companies where we are aligned with the founders on the long-term capital needs of the business. Those who have joined me on pitch calls of late have probably heard me ask this question of the founders who pitch us.”

10. “Being long-term bullish on crypto is a bet on the following: gambling, degeneracy, greed and desperation. Seems like a pretty easy yes from us. The most important part is staying in the game for a long time and rotating into more risk when you see an opportunity. That is the core working thesis.”

11. Eric is a friend and this was an excellent interview. So many nuggets of insight. Recommend his books.

12. Masterclass from one of the best tech investors on the planet.

13. Impressive young man. Makes you question your own momentum and ambition level.

14. “Russia is often portrayed as the invincible military power. And yet, this reputation is based on two wars — Napoleonic and WWII. In both cases Russia won only thanks to the alliance allied with *the* leading economic powerhouse of that era.

Napoleonic Wars were won because of the Russian alliance with the UK. WWII — because of the alliance with the US. In both cases the leading economic, industrial and technological power of the age supported Russia, giving it almost unlimited credit and supply line.”

15. “Eventually what I decided to do was try and show just how a supply based campaign would be the most effective thing for Ukraine, by talking about the issue of ammunition supply for Russian artillery — which has received a great deal of coverage lately. Long story short, if Ukraine could damage/destroy even a relatively small percentage of the ammunition heading to Russian guns, it would make an outsize difference in the war in 2024.

This is because Russia is not actually a great economic power and is generating relatively little new force (this is also true for tanks and other armored fighting vehicles and artillery pieces). Basically Russia is using and losing far more equipment than in can replace on an annual basis.”

16. “While most Christians would say the devil is the best liar in the world, I think the best is the person in the mirror. Self-delusion is perhaps the most challenging aspect of attempting the fuller lifestyle. Avoiding work because you’re being negligent and avoiding work because you are achieving balance look identical from the outside.

Getting this right means you have to be able to confront the full breadth of your weaknesses to ensure you aren’t being controlled by them. The hard part of living fuller, not bigger, is being honest with yourself. That there is no answer is the answer. You have to believe that you have the intelligence and grit to figure it out yourself.”

17. “While Musk may not be in the business of convincing people he’s less capable, he is hurtling dangerously toward the classic failing of all great hustlers — playing outside of the odds that made him rich in the first place.

Musk’s successes — SolarCity, Tesla, SpaceX and Starlink (which has only recently hit profitability) — come from buying into or building companies that sell something, juicing their revenues and valuations by extolling bright futures of eternal growth, the kind that the market adores.

Anything that Musk talks about is automatically covered by the media, which is something that inherently boosts any company that actually sells something, because there’s a call-to-action at the end of whatever churlish statement he chooses to make. When motivated by greed, Musk can be incredibly effective, because there’s something (theoretically) valuable at the end — Elon Musk has endorsed this product, the product does this, and you should either buy the product or the associated stock.

Every product decision he’s made feels like every time I’ve seen a desperate man lose thousands at a craps table “trying to make his money back,” mumbling that he “has a system” as the dice seem to work against him with every roll. Musk’s playbook has always been to sell the sizzle — that you’re buying into the future of something, even if that future is murky and the something kind of sucks — but it hinges heavily on there being something tangible and “cool” to own.

Musk has ultimately made the biggest mistake one can in gambling or hustling — letting emotion take the wheel. Acquiring Twitter was never about making money.”

18. “At hyperscale, the companies with the deepest AI exposure are enjoying faster growth rates as enterprise demand for these products accelerates.”

19. “Mining and processing graphite is an especially dirty business, and China doesn’t mind getting dirty when it can accumulate geopolitical advantages in the process.

The global production share chart for graphite is indistinguishable from countless others we have encountered over the decades. If a commodity is deemed critical and producing it is environmentally taxing, China inevitably comes to dominate it.”

20. Always enjoy these conversations. Why do founders stay in their company even after F — You money.

21. “RAADfest’s opening keynote speaker — and a big reason why I am here — is Bryan Johnson, a wealthy tech entrepreneur who has lately become an object of media fixation, owing to his colorful Twitter presence, absorbing diet and fitness regimen, and the fact that he spends most of his time and money on his attempt to live forever. To do so, he has created “Blueprint,” an algorithm using data about Johnson’s various organs that recommends protocols for his health, diet, and fitness.

Johnson is a big deal for the immortalist community. He is a lot younger and richer than most of the other RAADfest presenters, and due to a series of recent articles in The New York Post, Bloomberg Businessweek, and Time Magazine, he is kind of famous. He gets recognized in public a lot. People say things like, “Yo, vampire bro! Can I get some of that blood?” Johnson loves this.”

22. “But in recent years, it was his intense familiarity with those daily rhythms of his in New York City that made him realise it might be time for a major pivot. “After one too many days of doing the same thing, I just got this overwhelming sense that I was still playing the same hand of cards I’d had for a long time — but that I had a better hand to play,” he said. “I was living in this rental place that didn’t feel like home. I was getting the same bacon, egg, and cheese at the same deli. Resisting any lifestyle change.”

All the while, his circumstances had changed. He had grown older. The films were bigger. His profile was immeasurably larger. But he was holding onto something. Why? He had seen it up close in Hollywood. The man-child. The people who so loved playing characters that they played characters in their real lives, too, without actually transforming themselves into more mature human beings. He knew the cliché about celebrities staying developmentally the age that they were when they became famous.

But how is a beloved movie star meant to change the right way? How is he supposed to grow up? How does he meaningfully evolve his life and art without killing his core? This was the most important thing there was for Timothée Chalamet. It might be worthwhile to chart the course. “All I knew,” he said, “was it was time to level up.

It’s difficult to underscore how polar opposite the two ways Timothée Chalamet experiences time are. There are the long stretches during a movie production, during a press cycle, during a fashion campaign, when every minute is scheduled for days or weeks or months at a time. But there are other long stretches, in between the making of films and promoting them, that are seemingly devoid of time as we experience it, with infinite opportunities for developing a film character or developing himself.”

23. This is a good state of the seed vc investing market, I like the concept of inception investing rounds. Some very useful frameworks.

24. “Where does that leave the magical 250m population figure in reality? For many business models, especially those which are common in more developed markets, the real addressable market is perhaps only 10.6m if we include all of Groups 3, 4, and 5. While still a $43bn opportunity, if we factor in the propensity and ability of different ages within those groups to adopt technology, the number may be only half of that.

To build a scalable consumer-focused business in a market like Pakistan requires novel business models and go to market strategies that must be highly localised to succeed.”

25. “Given another few years at this pace of innovation, it’s not unreasonable to expect blockchains to be cost-competitive to classical databases.

More than that, they offer different types of promises to developers for data sovereignty, mathematical proofs, resiliency, & resistance to attack.

It’s the gas gas revolution. As the gas costs fall, more applications will be built on blockchains.”

26. “The starting point is WiFi Money (Online Business).

Once you’re making money from the internet, you can quit and most of the other things in the “good life” list come pretty much automatically.

WiFi Money is the starting point to freedom.

All I can say is, I’ve worked for others and I’ve worked for myself, and I like working for myself far more.”

27. “But, failure to recognize that we are already in a worldwide war and that we can resolve it with innovation and generosity of spirit are equally serious problems. All this is a reminder of Winston Churchill’s book While England Slept and John F Kennedy’s take on the same period called Why England Slept. Amazon ought to get both up on Kindle asap! Both leaders warned us.

But, we sleepwalked into WWI and WWII and further conflicts from the 1960s. Are we sleepwalking into another such situation? Are we asleep when we should be awakened to technological possibilities (something Marc Andreessen calls “Techno-Optimism”)? We exited WWII through technology. The atomic bomb unleashed destructive power so great it ended war. Could we release a constructive power so great that it begins a new era that would be post-geopolitics? I want everyone not just to wake up, but to start dreaming about what the future could and should look like before it is too late. The task is hard.”

28. “A year ago, Netflix was losing 1 million subscribers per quarter and had shed 75% of its market cap. It was the worst performing stock in the S&P 500. Fast-forward one circumnavigation of the Sun, and Wall Street is “gushing” over its “beautiful” results while the rest of the industry flounders.”

29. “The sweet spot is to find a strategy that works, which suits your temperament, and which interests you because…

Good investing is mostly ‘boring’ working with brief moments of excitement. I say ‘boring’ because the research process is boring to most people, but not to everyone. It is an endless loop of keeping up with the world and trying to understand things — a company, an industry, a trend, a technology, an event — by reading, crunching data, and talking to people.

Every once in a while, things get exciting. Like when you find a great idea or when the market punches you in the face. And in exactly those moments, you have to resist and remain calm. It’s the inverse of how most people go through life: they run from the grind of mundane work and throw themselves into thrills.

If the process of learning about companies and markets feels like keeping up with your favorite sport or celebrities, you’re ahead of the game.”

30. “One thing should be clear: allowing price fixing to occur through shared software rather than an explicit agreement is not just a technological change — it’s a legal change. Indeed, judges are simply rewriting the law to legalize price-fixing.

When it’s extremely hard to bring a complaint because the burden is just too high for plaintiffs — as is happening in the Rainmaker case and potentially the RealPage litigation — judges have created a liability shield for corporations to collude. “Nobody thought you could win” is a devastating and avoidable sentiment in the face of clear and pervasive harm.”

31. “Every founder tells themselves a story about why they’re heading to the gold rush, but the executive coach I would eventually hire says there are really only two. Do you want to be rich, generating wealth in service of some further end? Or do you want to be king, with money a mere byproduct of trying to make the world the way you feel it should be?

At the time, I told myself I wanted the freedom of being rich. I thought I’d be able to recognize a winning hand fast or fold. Now, several years later, I’m still waiting for the river card that determines my fate. You could call me a middle-class founder: proprietor of a business you may or may not have heard of, tenuously wealthy on paper, by no means a failure but not yet a success, chugging along in the twilight of an era that minted more giants and more waste than any other in history, with no exit in sight.

Today, the market has turned for everyone. We’re growing slower than I want, but other start-ups, even the hot companies that dominated fundraising in past years, are showing far more signs of strain. Some have already flamed out spectacularly, and for those that survive, the gobs of money raised from megafunds come with a catch: It needs to be paid back first, which means that employees and early investors who expected millions won’t make any money unless they deliver on their tall tales.

The culprit is technically rising interest rates, but you could argue it began when founders and investors started to see the downside of swinging for the power law. The first venture funds formed as a way for savvy investors to help innovators create fundamental technologies like transistors, which required huge outlays of time and treasure before they could produce value. But in the past few years, causality inverted: Start-ups and entire markets were manufactured from whole cloth to meet the demand of overcapitalized venture funds searching for a home run.

At work, there’s some sense that we’ve missed the windfall, the easy IPO, the fairy godmother of acquisition that taps some lucky people and makes them rich. You’d think that would suck for morale. But from what I can tell, our team seems happy. What venture capitalists are now telling startups to do — forget “growth at all costs”, be profitable — is what we, partly by accident, have been doing all along. With the exception of the new wave of AI companies, the skies are full of Icaruses crashing to earth, but we’ve been here the whole time.”

32. “Taking all these factors together, one must wonder about the efficiency gains for a software company. Will it be 20% cheaper or even 50% less costly to run a software company? This will undoubtedly impact the costs, scalability, and efficiency of running a business. Will it lead to the creation of more software companies or result in more mergers and acquisitions? Will the market competition offset these efficiency gains?

The exciting aspect of technology and considering the future is that these advancements are inevitable. From the perspective of software companies, using AI to enhance business operations, not just the products they offer, will be an intriguing area of innovation over the next decade.”

33. This is such an important discussion. The West is our own worst enemy due to our luxury beliefs/bad thinking and being afraid of exercising power.

It’s worth listening to. (skip the part on language and transgender/gender stuff, which was incoherent). Rest is excellent.

34. Learning from Founder Led Funds. Always stuff to learn.

35. “Venture capital is an existentially flawed, yet powerful, economic system that could kill the thing most VCs purport to love: startups. Just like the person who doesn’t want to take a life on the boat — you’re staring at a deadly thing. The deadly outcome isn’t something you want. But the failure of that outcome threatens your own life. The dissolution or rapid revolution of the venture capital industry threatens to kill a generation of tried-and-true VCs. So what’s to be done?

That’s the key to survival. Adapt. Venture capital is dying because it has adapted to focus on returns. The model has crafted an engine that generates returns, not necessarily enduring, generational companies. The same is true of things like the oil industry. Eventually, companies will be forced to bear the brunt of their own externalities. Venture capital is no different.”

36. “Expect this consolidation to continue, especially where platforms are emerging, and complementary products integrate well. Over time, we’re going to see more consolidation, but not as much as some might think.

The nature of SaaS, with its predictable cash flow, recurring revenue, and great gross margins, means that companies can remain in a “zombie state” — not growing rapidly but not dying off either. They don’t have to transact, and they don’t have to be acquired. So, the majority will not consolidate, but for those that align well with a larger platform, look for more M&A activity, especially over the next two to three years, as larger, well-funded platforms look to expand their total addressable markets more aggressively.”

37. “You aren’t successful because you say you want to help others, but you won’t learn the skills that allow you to help others.

You aren’t successful because you focus too much on art, and then blame the market when they don’t see the value in what you have to offer (because you couldn’t articulate it with marketing and sales).

You aren’t successful because you “focus on your craft” rather than getting your craft in front of potential customers. Your websites, designs, writing, and other projects do not count until other people see them. You are delaying the time to feedback. Without feedback, you can’t make it valuable. Your first iteration will not be valuable.

You aren’t successful because you have an incomplete perspective on what business is. It is how you participate in the advancement of humanity by creating a product that raises the collective consciousness.

You aren’t successful because you took these points as personal attacks, closed your mind to your potential, and allowed your conditioning to rule you.

You aren’t successful because you don’t create something valuable that the market wants to pay for. People don’t want what your ego wants, they want what Mother Nature wants, and who are you to act like you know what that should be?”



Marvin Liao

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