Marvin’s Best Weekly Reads January 7th, 2024
"Be willing to be a beginner every single morning" –Meister Eckhart.
Follow the world's energy trail.
https://www.youtube.com/watch?v=4mbQDmbaZuQ
2. A solid perspective on Henry Kissinger. Realist but effective in a ruthless and cynical way. Bit too cold blooded for me but something to learn here.
https://www.youtube.com/watch?v=NCCC0mOYNos
3. This is such a great episode talking about different business stories. Always learn so much.
https://www.youtube.com/watch?v=lNSVc0S5MvA&t=20s
4. "While her popularity has grown across the decades, this is the year that Swift, 33, achieved a kind of nuclear fusion: shooting art and commerce together to release an energy of historic force. She did it by embracing what she does better than anyone, entertaining and writing songs that connect with people.
Now she becomes the first Person of the Year to be recognized for her success in the arts, in a year when we were reawakened to questions about who makes and who owns our cultural expressions. Swift is also a symbol of generational change: she is only the fourth solo Person of the Year born in the past half century.
In the 17 years since her debut, Swift has notched more No. 1 albums than any other woman in history. This year alone she had three. She was everywhere in 2023, filling stadiums and breaking records, which meant we were forced to find novel ways to measure the magnitude of her reach. Seismograms were deployed to show the literal impact caused by her fans.
As Swift reportedly became a billionaire, countries’ gross domestic products became the yardstick for her financial contributions. University classes to study Swift’s lessons in literature, business, and law were announced. Swift was showered with keys to cities and street signs changed to her name."
https://time.com/6342816/person-of-the-year-2023-taylor-swift-choice/
5. I'm bullish on SBSW & VTNR.
"The Nasdaq today is overvalued on nearly every conceivable historical metric. The CAPE ratio for the Nasdaq 100 is over 50 - near an all time high. Meanwhile the market thinks Braskem is literally worth less than half of the offers made by large industrial companies.
History shows that the time to by cyclical companies is when everyone else hates them. The time to sell is when others love them. Value investing may not be a perfect strategy, but it’s the only way to make money in markets that at least to my mind, seems repeatable. I’m sticking with it."
https://calvinfroedge.substack.com/p/the-market-is-kicking-me-in-the-teeth
6. Big fan of Chris Williamson.
https://www.youtube.com/watch?v=iTaDwpDTcX8
7. These are excellent ritual situations for operating tempo.
"Operating velocity helps you create an exceptional culture and phenomenal team, both of which are critical ingredients to moving even faster. There is one other ingredient that makes or breaks the velocity of a company: its operating cadence.
By the time you cross 10 employees, as CEO, you start to ritualize key team events. Events like the “Weekly All-Hands” become a standard way that communication occurs and culture is built.
As you get bigger, these events are the “operating cadence” of a company — they are the rhythm of an organization that shape how decisions get made and how information is shared as companies scale. Different companies have different operating cadences: some companies are meeting-heavy, and some underemphasize communication; some companies develop process too early, and others too late."
https://medium.com/@travismay/building-the-right-operating-cadence-6c608fd142e1
8. "As Ukraine’s anticlimactic summer counteroffensive abates (and the Western media excitedly reverts to another cycle of hyperbolically dire assessments and forecasts about the war), it is easy to lose sight of the remarkable fact that Ukraine has recaptured over 20,000 square miles of terrain and continues to deliver a succession of tactical and strategic humiliations to Moscow.
Most recently, it has forced the Black Sea Fleet to relocate its historic naval base - in occupied Crimea - 500 miles east to Novorossiysk in Russia-proper. through the use of harassing drones, missile attacks, and marine raids, – Ukraine has achieved a feat of deterrence the British, French, and Turks would have envied as far back as the mid-nineteenth century. This is to say nothing of Ukraine’s ability to strike well behind enemy lines via its hypertrophied covert action capability. The SBU, the country’s domestic security service, has reportedly blown up two cargo trains in Siberia, some 3,000 miles from Ukraine’s border, according to a Ukrainian source speaking to Reuters.
If anything resembling a normal political environment existed in the United States, Ukraine’s battlefield successes to date would be trumpeted as an enormous return on investment. But as of writing, the latest security assistance package, which included $61 billion of aid for Ukraine plus funding for Israel and Taiwan, stalled in the Senate, the victim of partisan squabbles over a supplemental border security package and curbs on immigration.
The Biden administration, then, has done three things simultaneously by arming Ukraine, all of which MAGA bangs on about in advocating the United States “defund” Ukraine. It has created and is still creating new manufacturing jobs at home while breathing new life into an obsolescent or sclerotic American defense sector. It has cajoled ambivalent or tentative NATO allies into taking more responsibility for their own security and shouldering more of the burden for a European nation at war.
It has radically diminished the conventional threat posed against the United States by Russia – a threat previously anatomized by Donald Trump’s own Defense Department – thereby freeing up resources, attention, and bandwidth for deterring China, the other state power posing such a threat. All this without the deployment of a single American soldier to a combat zone or the loss of a single American life overseas. You might even say the vanguard of the Republican Party should by now be “tired of winning;” instead, they insist, getting everything they ever claimed to have wanted is presented as a colossal defeat."
https://theins.press/en/politics/267432
9. "The second problem is that Western war production hasn’t really ramped up nearly as much as it needs to. Russia has increased its ammunition production to 1 million shells a year, and may eventually be able to make it to 2 million; they’ve figured out ways to evade Western sanctions by routing imports through third countries like Kazakhstan, and they’re getting significant help from China. The U.S. plans to increase shell production to a similar amount, but not until 2025.
Meanwhile, the Europeans are still floundering, unwilling to spend the required money and saddled with a defense procurement process even more dysfunctional than America’s. Thus, for the next year or two, Russia — a country with a GDP only the size of Italy’s — will be singlehandedly outproducing the entire West in terms of some of the most essential weapons of war.
(Side note: Imagine what a war with China would look like.)
Ukraine’s third and final hurdle is manpower. Russia has more than four times as many people as Ukraine. Even though Russia’s mobilization has been chaotic and haphazard and Russians are less motivated to fight in the war, it’s a lot easier for Russia to come up with bodies to throw into the meatgrinder, simply because of the country’s sheer size.
So Ukraine is in trouble. But that doesn’t mean Russia is about to win, or has already won, or any of the things that the pro-Russia people love to scream on Twitter. Before we believe their propaganda, we should think carefully about why this war is happening, what Russia hoped to accomplish, and what Ukraine has won so far.
In the year since Ukraine took Kherson, the war has become a static one. But Russia has continued to take massive casualties. According to recently declassified U.S. intelligence estimates, Putin’s military has taken 315,000 casualties (dead and wounded). That’s almost half again as many as the 218,000 casualties that the U.S. took in the entire Vietnam War.
But it’s still a staggering number. Only by throwing Russia’s entire economy and society into the effort has Putin managed to maintain battlefield parity with a poor country less than one-fourth Russia’s size. And even more importantly, Russia has lost massive numbers of tanks and other armored vehicles — by some estimates as many as 4000 tanks! — basically running down the huge arsenal bequeathed to them by the Soviets.
To sum up, if the war ended tomorrow, it would be a technical Russian victory over Ukraine, but a strategic defeat for Russia and a successful independence struggle and nation-defining episode for Ukraine. And the U.S. and NATO would have achieved a strategic success without even fighting. A lot of Ukrainians would be mad that 18% of their country was still occupied by the Russians, of course, and would resolve to get it back at a later date. But when you put it in perspective, it’s clear that this would be an overall Ukrainian triumph."
https://www.noahpinion.blog/p/some-thoughts-on-where-the-war-in
10. Guy is a MAGA Kook but he is not wrong here. The WEF is anti-human.
https://www.dossier.today/p/world-economic-forum-demands-35-trillion
11. Super helpful info for sales managers in B2B.
https://kellblog.com/2023/12/14/lessons-from-playing-with-a-simple-quota-attainment-model/
12. Hybrid war happening against us.
"The general perception is that the number of hate crimes in the US has exploded since 2016.
-They haven’t. The perception of a surge is due to:
-Amplification from social networking and mainstream media.
-A large and rapidly growing number of faked incidents.
Disturbingly, a growing number of incidents appear to be the work of nation-states, corporations, or funded activist groups."
https://johnrobb.substack.com/p/unlimited-outrage
13. Excellent conversation this week. VC is over for the year. Make number go up!
https://www.youtube.com/watch?v=A0vtDOKU5Tg
14. Love this guys Newsletter: Recommend it. Byrne Hobart is great.
https://www.youtube.com/watch?v=BoKjGfiK3nM
15. "While even the greatest venture investors will attribute their success to luck, the consistency of returns amongst the top investors is evident. It’s not just luck when you’re an investor that is consistently investing in amazing companies at the earliest stages. While early success certainly makes it easier to win subsequent opportunities, I’m a fervent believer that there are better “pickers” than others — those who can develop independent conviction in opportunities that are non-consensus.
Finding opportunity where others don’t see it requires more than a crystal ball — it requires work! As I witness the best investors in the VC asset class, they put in this work to consistently see greatness where others don’t. Yes, they win consensus “hot” deals as well, but even those opportunities require them to develop a premium on their conviction. Developing that type of conviction requires a way to structure thoughts despite incredibly unstructured data — that’s done through mental models.
Kenneth Craik proposed the concept that individuals use “mental models” to “anticipate events, reason, and form explanations”, but it was Charlie Munger who popularized their application in the investing world, implying that he used a latticework of different mental models — essentially an integrated system of different mental models — to inform his investment perspectives.
While value investing and venture investing are different disciplines, the best venture investors of the last decade all have their constructs for evaluating investment opportunities — some of which are based on popularized emerging concepts like the power of network effects and others of which were likely home grown."
https://medium.com/@EqualVentures/on-the-importance-of-mental-models-in-investing-fa2b3a285e5c
16. "In 2024, I expect most of these figures to revert to the mean - not the peaks of 2020-2021, but more akin to 2018.
The public valuation environment & pace of venture capital investments mirror those years better than others.
Five years ago, valuations continued to grow, competitive rounds didn’t last in market for more than a week or so, & pre-emptions did occur. But most of the market operated at a steady cadence with predictable figures for traction, valuation, & dilution."
https://tomtunguz.com/the-typical-round-in-2023/
17. OG of Silicon Valley. Vinod Khosla. Lots of great learnings.
https://www.youtube.com/watch?v=A5c2ho3YQBg
18. Grifters everywhere. These people are the enemy. But still appreciate the hustle.
19. Rick Rule is one of the best observers of commodities and consequently geopolitics.
https://www.youtube.com/watch?v=0aDfNjkH9DE&t=65s
20. Not a bad thing that the VC bubble is popping. Hopefully the arrogance too.
"For the last decade, a career in VC came with the promise of huge returns, as technology startups raised record sums and a flurry of initial public offerings minted a new generation of VC millionaires. But OpenView’s sudden collapse, precipitated by the departure of several of its senior partners, cemented a growing fear among investors that a job in VC was far less secure than many of them had once imagined. Even firms that have raised funds in the billions of dollars aren’t immune to the challenges presented by higher interest rates.
For junior investors who grew accustomed to the bountiful opportunities of recent years, the adjustment to the current reality is especially harsh. Many of them came to see quick follow-on investments, which increased the value of their deals on paper, as the natural order of things, along with speedy job promotions. Succeeding in venture during downturns requires a different skill set and patience, seasoned investors claim. The adjustment can be painful.
“This year, partners have left an array of elite Silicon Valley VC firms, including Menlo Ventures, Sequoia Capital, Y Combinator and Greycroft Partners. Many departures have occurred as the firms have shifted their strategies to focus on hot investing categories like artificial intelligence. So taboo is the subject of layoffs at VC firms that almost none of them will publicly admit they have happened.
For the first time in more than 10 years, the downsides of the job are much more apparent,” said Theory’s Tunguz, who started his venture career in 2008.
Bear market conditions have caused “simmering pervasive anxiety” among VC’s next generation, Slow’s Rechtman said.
“A year ago it was, ‘Things are going to be really bad, but it’s not going to be me and it’s not going to be you,’” Rechtman said. “Now I would be surprised if there’s anyone that doesn’t have a good friend and colleague who’s been laid off in the last year. It’s sort of impossible to ignore.”
21. This was such a great conversation. So insightful. I use this word alot but it really was so good. Interview with Jeff Bezos. It's a long one but it went by very fast.
https://www.youtube.com/watch?v=DcWqzZ3I2cY
22. "All businesses exist on a spectrum and this 2x2 just reduces the complexity of the real world into something easier to generalize. I think the answer to whether to get off the train really depends on the kind of company you have.
If you have a business that is no longer a fit for the venture model and doesn’t have near-term prospects for good unit economics, you have to get off the venture train and figure out if the business you’re working on is viable. If you have a business that has really good unit economics, can get profitable, and grow, you might want to seriously consider getting off the train. This is particularly true if you are in a category where investors do not have a lot of enthusiasm for your category. Taking your own destiny into your own hands might be the right answer for you.
My big takeaway from having had many of these conversations that the choice to stay on the train really requires evidence or a belief that you’re pursuing an opportunity that really fits the kind of outcomes that VCs want to see. If you’re not in one of the rightmost quadrants in the chart above, I would question whether it makes sense for you to stay on the VC train and rely on venture funding for your future financing needs."
https://chudson.substack.com/p/getting-off-the-vc-train
23. Lots of good tips for productivity and enjoying it at the same time. Ali is the man! Can't wait to get the book.
https://www.youtube.com/watch?v=z3jNYz0kxWg
24. "All of these machinations have helped forge a new category in the clubby world of venture capital, elevating the hosts of “All-In” from mere startup investors to business-celebrity influencers. However, the brands they are most avidly promoting aren’t companies or consumer goods (yet), but themselves. Meanwhile, the success of the podcast has helped paper over a less-than-dazzling run in the hosts’ day jobs, including flopped investments, increased regulatory scrutiny, dozens of shareholder lawsuits and humbling fundraising struggles.
A source familiar with the podcast's production explained that the four hosts used it as “a way to get business, as a way to get deal flow, as a way to be recognized by [limited partners], as a way to build brand notoriety.” This strategy, said the person, aligned with a philosophy commonly espoused by young VC firms—that “the ones that have really held the staying power and distinguished themselves had a very differentiated marketing strategy.
Some fans hang on every word the besties say. Others love to hate-listen. But the podcast’s reach within tech is undeniable. “Every time I survey entrepreneurs, it is the only podcast that has wide adoption,” said Founders Fund general partner Keith Rabois.”
25. "My recommendation for entrepreneurs is to find a relief valve during stressful periods. For some, it’s going on a jog; others, it’s playing video games. Some love to cook or read fiction. In the end, it’s important to have something that works for you so that when the stressful times occur, and they always will, you have a relief valve ready to go."
https://davidcummings.org/2023/12/16/relief-valve-during-stressful-periods/
26. "In America, to have money is to be more interesting. People are drawn to you, give you the benefit of doubt, laugh at your jokes, and are apt to want to help you and your family. In sum, to be rich in America is to be loved. If America is a family, the household has never been more prosperous and full of love. However, like the future, it’s not distributed equally.
As we’ve written before, ground zero for America’s problems boils down to one thing: For the first time in our history, a 30-year-old is not doing as well as his/her parents were at 30. This is a fundamental break and, more disturbing, a function of deliberate decisions (i.e. social and economic policies that transfer wealth from young to old).
Nimbyism, rejectionism, seniors voting themselves more money and bailouts, financed by future generations, to preserve the wealth of incumbents are generational theft, full stop. A 70-year-old is, on average, 72% wealthier than four decades ago; a citizen under 40 is 24% less wealthy."
https://www.profgalloway.com/prof-g-person-of-the-year/
27. "This should be the first very strong clue that modern rich nations’ wealth didn’t come primarily from plunder, but from something else — something that nations started doing over the last century and a half. In fact, we know what that something is — it’s industrial production, coupled with modern science.
We are far richer than our ancestors because we know how to make a lot more stuff than we did then — cars and trains and planes and antibiotics and vaccines and reinforced concrete and electricity and running water and TVs and computers and all the rest. And we know how to make stuff more efficiently. In 1810, 0.4 percent of Americans’ income was spent on nails. Yes, you heard that right — the little metal pointy things took $1 out of every $250 we earned. Nowadays it’s negligible. In 2006, the price of lighting in the UK was about 1/4500 the price of lighting in 1786.
So the fabulous wealth of the modern day can’t be due to plunder alone. The world does not contain a fixed lump of wealth that gets divided up among the people of Earth. Human ingenuity and hard work increases the amount of wealth in the world.
All things considered, I think the more reasonable case to make is that wealth, generally speaking, is something that comes from a country’s technological ingenuity, hard work, sound policy, political stability, high-quality institutions, and openness to foreign ideas and technology and investment. Today, in 2023, wealth is a thing that nations create for themselves, not something they steal from other nations."
https://www.noahpinion.blog/p/nations-dont-get-rich-by-plundering
28. "What keeps Russia going (and saves it from defeat) is primarily Western hesitation, disunity, and a lack of political will in providing a decisive and powerful military and financial aid to Ukraine.
With: 1) no troops on the ground, 2) most of the contracts and military-industrial benefits going to US states and manufacturing plants (that create more jobs, and get their assembly lines in shape - in preparation for a larger conflict with China), and 3) at a mere 0.18% of its GDP and an annual amount 4x less than what is lost by the Federal government to general transaction errors, what the US gets in return is astonishing: a 315k casualty inflicted on Russia’s armed forces (with 90% of pre-invasion army accumulated at the Ukrainian border, now destroyed).
Credit where it is due: when it comes to manipulation and deception, Putin stands out as a class of his own.
To be clear, he is not necessarily extraordinary in his skill (although he very well may be), but his willingness to be so brazen in applying his skills certainly makes him extraordinary.
He has managed to convince a not so insignificant portion of the electorate in the US and the EU that he is a bastion of traditional christian values - fighting against the woke and decadent west."
Also JD Vance, Orban and their ilk are scum.
https://thebismarckcables.substack.com/p/weekly-overview-ukraine-war-putins
29. "In our cartoon world view, every single industry follows long cycles. This could be the business cycle, the crypto cycle and even the stock market cycle that typically goes for about a decade or so. The bond market also has a cycle if you look at interest rates.
Therefore, the main reason we were so focused on the bond market at the end of the year is simple. It’s usually a 15-20 year frame cycle. We’ve never owned bonds or even considered talking about them for anyone who has followed us for more than a decade.
This created a chance to build a position and never look at it again. The same applies to all of the financial assets we try to buy: stocks, bonds, crypto and RE.
Currently: Crypto cycles are historically quite short since it’s a brand new asset class. Innovation is continuing to move in that direction so just like the internet you are forced to research, invest and use the products. If you don’t you could be left in the dust bin similar to people who didn’t take computers seriously in the 2000s.
RE: This is usually a 10-12 year cycle and as you know getting out in 2021 means that we think it’s largely done. While being flattish over the last 2 years is not bad, it isn’t good if rates remain at 5%.
Stocks: This is turning into the new bond market. Outside of a few major winners who continue to take market share (FAANNG) or some other acronym, there are very few companies that will become extremely large in the future. Even then it will be tech/healthcare since that’s what drives value. People will be glued to screens and using tech to lower the cost of every other product made on the planet (from food to clothing). Without tech, no productivity improvements are seen.
Bonds: Only move in dramatic events. COVID was one, the financial crisis was one and the Tech boom/bust was another good example."
https://bowtiedbull.io/p/re-market-update-lump-sum-investing
30. Hmmm......geopolitical view of MENA region after America retreats.
https://www.youtube.com/watch?v=PycoZ1R35Z4
31. I fall in this camp. Sam Lessin is incredibly incisive on his views of what VC will look like. A return to craftsperson style of venture. Cookie cutter VC is over, thankfully.
https://www.youtube.com/watch?v=crj_H3JPHvg
32. Very educational conversation from a very experienced LP. All venture managers should listen to this. Emerging fund managers are where the action is at.
https://www.youtube.com/watch?v=IwL6WbMt5oM
33. "It's hard to imagine a break-glass, wartime general allowing any of these issues, which amount to middle school politics, to get in the way of outcomes. But why wait until wartime to solve problems we can fix today?
If the military-industrial complex is only capable of innovating during wartime (and even that premise is questionable) and is dysfunctional during peacetime, this bodes poorly for progress writ large. The U.S. government has a unique role to play in progress by seeding capex intensive and often highly regulated technologies that will not otherwise make it to a commercial market. For some of the world’s most impactful technology, the U.S. government will be the first but not the biggest customer.
The integrated circuit is the best example of this. Minuteman and Apollo were critical early programs, but chip demand for personal computing was soon a much bigger market than defense. The Space industry today is around the same stage as the integrated circuit was in the early 1960s.
Now, the U.S. government should not seed industries it has no use for, but for certain technologies, it is the pacesetter on progress. It is therefore unacceptable to have stagnation just because the American people no longer practice duck-and-cover drills."
https://kinetic.reviews/p/rejecting-our-faustian-bargain
34. "But there’s another place that chipmakers can put their fabs right now — a country with cheap land, labor, and capital, with a sophisticated existing semiconductor supply chain and lots of skilled workers. A country more secure from Chinese invasion than Taiwan, yet not as hobbled by domestic political divisions and labor-management struggles as the U.S.
That country is Japan.
In fact, this post is a bit late, since chipmakers are already investing quite a bit in Japan.
In any case, I don’t want to make it sound like I think Japan is headed for dominance in the semiconductor industry. Instead, I think it will reintegrate itself into a supply chain that includes the U.S., Taiwan, South Korea, and Europe — a globally distributed web of high-tech companies that cooperates more than it competes, and which is dedicated to the overriding purpose of staying ahead of a hard-charging China.
That’s a very feasible goal for Japan, rather than the single-country dominance it aimed for in the 1980s. And that’s why I predict that chipmakers are going to continue investing there."
https://www.noahpinion.blog/p/six-reasons-chipmakers-should-put