Tiger Global

  • A fascinating read about Tiger Global’s innovative velocity focussed venture/growth strategy.
  • It can be summed up as follows:
    • Be (very) aggressive in pre-empting good tech businesses
    • Move (very) quickly through diligence & term sheet issuance
    • Pay (very) high prices relative to historical norms and/or competitors
    • Take a (very) lightweight approach to company involvement post-investment
    • Above all, deploy capital, deploy capital, deploy capital
  • It is disrupting venture investing and earning high returns in the process.

a16z Marketplace 100: 2021

  • The latest edition of the top 100 private/start-up consumer facing marketplaces using Bloomberg real-time consumer spending data.
  • A lot has changed in 2020 for obvious reasons. The full report is here.
  • Interesting to see Turo at number 9 (up 5 places), which is an investment (they own ca. 26.8%) by IAC that few talk about.

Being Negative

  • This is an eye-opening essay on The Art of Negativity with useful read-across to investing.
  • This was an interesting result from research – “there is a clear asymmetry in the way that adults use positive versus negative information to make sense of their world; specifically, across an array of psychological situations and tasks, adults display a negativity bias, or the propensity to attend to, learn from, and use negative information far more than positive information.“”
  • A nice quote – “An optimist believes we live in the best possible of worlds. A pessimist fears that this is true.

The Internet

  • A thought provoking and contrarian read arguing that the tailwinds from the internet and silicon valley are fading i.e. the industry is maturing.
  • This chart shows that growth rates are coming down in most areas of tech.
  • Worth noting it was done in early 2020 so missed the pandemic driven acceleration (the unanswered question being whether that was just pull forward or a true step change).
  • This type of environment leads to a rebalance of growth away from start-ups towards internet-first incumbents – as the former can’t rely on the market to grow and the latter use vast operational muscle.
  • This has profound effects including the financialisation of the technology industry.

Power of a Story

  • A really nice piece about the power of stories in academic research, investing.
  • And even innovation as seen in these great extracts from Rory Sutherland’s Book:
  • Making a train journey 20 per cent faster might cost hundreds of millions, but making it 20 per cent more enjoyable may cost almost nothing.
  • The Uber map is a psychological moonshot because it does not reduce the waiting time for a taxi but simply makes waiting 90 per cent less frustrating.
  • It seems likely that the biggest progress in the next 50 years may come not from improvements in technology but in psychology and design thinking. Put simply, it’s easy to achieve massive improvements in perception at a fraction of the cost of equivalent improvements in reality.

Reddit

  • Comprehensive and fascinating look at Reddit.
  • The article covers its tumultuous founding (YC start-up) and history.
  • The undervaluation vs peers – the latest round valued the company at $6bn or $115 per daily active user (DAU) vs. $400 for Facebook and $310 for Twitter.
  • And finally possible areas of improvement and expansion.
  • All interesting to read ahead of the speculated IPO.

Lessons from Gian-Carlo Rota

  • Twelve lessons from the famous mathematician and lecturer.
  • They relate largely to teaching and writing mathematics but, with Farnam Street’s magic commentary, they transcend to much of life.
  • A nice quote from Feynman as well – “Richard Feynman was fond of giving the following advice on how to be a genius. You have to keep a dozen of your favorite problems constantly present in your mind, although by and large they will lay in a dormant state. Every time you hear or read a new trick or a new result, test it against each of your twelve problems to see whether it helps. Every once in a while there will be a hit, and people will say: ‘How did he do it? He must be a genius!’”
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