Marvin’s Best Weekly Reads Feb 6th, 2022
“There is nothing permanent except change”–Heraclitus
This is important geopolitically. But also personally I have deep affinity for the Ukrainian and Russian people. Alas, politics gets in the way.
The West needs to take a much harder line against any Russian incursion & also should arm up the Ukrainian army more. Good fences make good neighbors. Relevant in any arena. The present wishy washy approach right now is weak and problematic to say the least.
https://mercurial.substack.com/p/special-briefing-the-russia-ukrainian
2. This is a good thing btw.
"The takeaway is not "fund = bad, being alone = good." It's a shifting of the focus towards the person. The influence they have as a renegade. Harry realized he could do more leaning into his own brand than trying to force himself into a monolith.
No one would argue these renegades are going to overwhelm the entire established venture community. The "kingdoms" of Sequoia, a16z, etc. are still powerhouses that aren’t going anywhere. But renegades exist in the ecosystem with them. They're not after-thoughts like regular angels that VCs might entice into a round to add flavor. They're frenemies that can contend for deals.
VC renegades have emerged from different backgrounds, whether from traditional celebrity (Serena Williams, Ashton Kutcher), new media (Harry Stebbings, Packy McCormick), operating roles (Elad Gil, Josh Buckley, Lachy Groom) or spin-offs from traditional funds (Lee Fixel, Katie Haun, Dave Yuan). And I think this is just the beginning of these kinds of investors."
https://investing1012dot0.substack.com/p/the-unbundling-of-venture-capital
3. "Since those early days, Air-Glaciers has become famous in Switzerland for its rapid deployments in Alpine disasters. They've extracted the injured from deep crevasses and carried them down from towering ledges on high mountain walls.
The skills to respond to such a wide variety of high-mountain disasters are honed by the Air-Glaciers rescuers through intensive training that begins with a three-year Swiss-mandated course in alpine guiding. That's followed by months of specialized practice and a yearlong paramedic course. Every 12 months, just before ski season, each of Air-Glaciers' rescue guides and pilots must also complete a weeklong proficiency course designed to refine their skills in everything from post-avalanche searches to high-altitude extractions."
https://www.gq.com/story/rescue-heroes-swiss-alps
4. "Given all these events, perhaps it is worth considering the possibility that the potential for conflict is not exclusively in Ukraine. Perhaps there is a chance that the Baltics and the Suwalki Gap are also “in play”.
The difference is immense. Another invasion in Ukraine will capture the world’s headlines but probably not move the world’s markets. Action in the Baltics and across the Suwalki Gap will."
https://drpippa.substack.com/p/warwhere-the-suwalki-gap-part-2
5. "The old warfare was about damaging an opponent’s hardware before it could do any damage. The new warfare is about denial of use. It’s about damaging access to the digital operating space by disrupting access to WIFI, GPS and Sat Nav. But, that has untold consequences for civilian life we should all be thinking about.
Further complicating matters, the Superpowers seem to have spent the last decade pushing militaries themselves off-balance sheet. The debt problem has led to the privatization of militaries. We may have more mercenaries funded by governments today than at any time in history. The Russians have done the same, perhaps for other reasons. Plausible deniability is valuable in a world where conflict is remote and subthreshold.
Private American and Russian mercenaries and Chinese "contracters” seem to be all over Africa, the Middle East and Asia these days. It has become nearly impossible to disentangle the role of the state and private military organizations in this new era of competition, confrontation and sub-threshold conflict."
https://drpippa.substack.com/p/wwiii-has-already-started
6. Important facet of any future war. Cyber aspect of it.
https://www.linkedin.com/pulse/beginners-guide-cyber-war-terrorism-espionage-tony-martin-vegue
7. Man, I really miss Warsaw and Poland overall. Hope to make it back in the summer.
https://www.gq-magazine.co.uk/lifestyle/article/warsaw-travel-guide
8. I am very partial to Ukraine. An interesting diagnosis on the country. Bullish on the place assuming it does not get invaded.
"Ukraine has one huge advantage: It has a very important reason to grow. Becoming a rich country like Poland is Ukraine’s best chance for standing up to a domineering neighbor three times its size. External military threat has been a catalyst for development for countries throughout the ages, most notably Japan and South Korea. Hopefully it will do the same for Ukraine now."
https://noahpinion.substack.com/p/why-is-ukraine-such-an-economic-failure
9. Good analysis on the crisis in Ukraine. I hope peace prevails here.
https://www.fpri.org/article/2022/01/moscows-compellence-strategy
10. This is hilarious and eye-opening.
"In recent years, research has suggested that a certain fraction of consumers are particularly skilled at picking out products that are destined to fail, or get discontinued.
They’re called harbingers of failure, or harbinger customers."
https://thehustle.co/the-customers-who-repeatedly-buy-doomed-products
11. What a surprise: high employee turnover at high growth startups run by people who have never managed people before. This is frankly endemic in startup world.
But it's possible to turnaround assuming founders get professional coaches or lean on new experienced execs. Most founders will not though sadly. #Hubris
https://sifted.eu/articles/n26-employee-exodus
12. Whatever you think, Putin has been masterful. I personally do not like it at all but you have to give him credit where its due, he has been playing chess while the west plays checkers (badly).
"All this activity is the culmination of years of painstaking Russian planning and effort that long predated active Russian preparations to threaten an invasion of Ukraine. It is another example of Putin’s ability to conceive and pursue coherent strategies over a long period of time, not just to seize opportunities. And Putin has always meant it to threaten NATO as well as Ukraine."
https://thehill.com/opinion/national-security/591008-nato-must-reinforce-its-eastern-flank-right-now
13. "So for now, we have to make do with the next best thing: A network of overlapping, mutually reinforcing alliances and partnerships that serve to thicken and reinforce the barriers to aggression. The Quad is part of that; AUKUS helps; the Japan-Australia defense cooperation act signed recently is a good sign. It's great when six or seven nations get together in military exercises, as happened in the Philippine Sea in October, or when the U.S. and Japan subtly advertise (mostly through media leaks) their plans to cooperate militarily in the defense of Taiwan.
Perhaps one day we'll get to a more formal, multilateral organization for collective defense in the region, but for now we need a lot of little things that add up to the threat of a very big, multilateral response if China uses force.
The good news is that, even together, Russia and China can't overmatch the U.S. and its allies. Even a distracted U.S. plus NATO is still capable of competing with Russia; the U.S. plus its allies and partners in Asia has significantly more geopolitical heft than China. I don't want to make this sound easier than it is. But the balance of power still favors the democracies."
https://noahpinion.substack.com/p/interview-hal-brands-international
14. "The risk of being exposed to the liquidity trade (long bonds, tech, private equity, ESG, most of crypto) given peak profit margins and hawkish environment is now significantly higher, and we might want to hedge our exposure or take some profits where we can.
Real Assets continue to be our preferred theme: from commodities to real estate (selectively, and hopefully near a surfable beach) and some buckets of equities (significant preference for value over growth simply because it allows us to sleep at night, and we really like to sleep). This is a multi-year theme that will continue to play out.
You know our view on Bitcoin, and broadly think that we should (1) only allocate money that, if we lose it, it won’t change our life (2) only think about taking profits when Tom Brady retires, or Tim stops trying to be a surfer.
After the beating last year, Emerging Markets might bring some positive upside, especially if the US Dollar softens – but we need to know what we’re investing in, and that also includes an awareness of the local rule of law and of the “in between the lines” shenanigans of politics."
https://www.thelykeion.com/higher-rates-peak-margins-and-how-to-allocate
15. A skeptic’s view of Bitcoin.
https://doomberg.substack.com/p/dollars-ex-machina
16. Good summary of key drivers of the crazy market we are in.
"We look at things purely through the money lens of the economy sometimes. But the economy and markets are much more than just stock and flow - it’s human behavior. And when we think about coming out the other side of a pandemic (maybe?), there was a psychological human cost to that. There’s a human cost to ALL OF THIS.
Markets are mechanisms that price change - reflections of ourselves. They tell us what we want to see, what we want to believe. When things get rough, it’s super easy to get pessimistic - in fact, it’s human nature to do so. Reflexivity begets reflexivity.
Everything is a game until it is not. We sometimes get caught in the game, which I think happened to many in the most recent crypto/stock cycle - the game becomes us, we are defined by the money we make, by the gains - money becomes a religion. And when the losses come - well, so does the loss of faith.
However, the game is changing - the possibility to enact change with some elements of crypto/web3, the need for alternative energy sources, demographic shifts - it’s a constant evolution, a constant shift of the economic game."
https://kyla.substack.com/p/on-market-movement
17. Definitely good perspective here on the Ukraine-Russia issue.
https://puck.news/inside-the-biden-putin-chess-match
18. This is an incredible situation that the EU has gotten themselves in & entirely preventable.
"The #1 lesson of Europe’s natural gas dependence is this: European governments have wildly overestimated the ability of solar and wind to provide the energy they need and wildly underestimated the need for fossil fuels and nuclear to provide the energy they need.
If Europe’s level of dependence on Russia for natural gas scares you, know this: America is even more dependent on China for many of the key components of solar panels, wind turbines, and batteries than Europe is on Russia for natural gas."
https://alexepstein.substack.com/p/europes-extreme-vulnerability-to
19. I agree with this. Africa is a super interesting frontier investment opportunity.
https://mailchi.mp/1a4a49e014a5/one-of-my-favourite-long-term-investments?e=123a1c25c4
20. This is really smart & differentiated. So glad I am not in the accelerator game anymore. Pear, ODX & Hyper are the ones to watch.
"The short version is: distribution. It’s hard to argue with the overall assumption that the Hyper team is working under — capital is majorly commoditized. Frankly, sometimes that’s all you want from an investor whose value add is more of a thorn in your side than anything. But, especially at the early stage there are a few funds and firms that offer a strong value outside of writing checks in the form of, say, hiring, sales introductions or board members that have relevant operational experience.
Where Hyper differs, says Buckley, is that they see distribution as the biggest value add for a nascent startup at the stages where the firm hopes to invest. Product Hunt is one opportunity that he points to as an example. It’s an established launch pad to an audience of extreme early adopters that can provide a seed of a real user base — Hyper itself is launching via a post on the platform."
21. The Russian military is no joke. They mean serious business.
https://news.yahoo.com/russias-military-once-creaky-modern-124721425.html
22. I seriously hope these guys are right. War in Ukraine is bad for everyone.
https://sofrep.com/news/we-remain-skeptical-that-russia-will-invade-ukraine
23. Jim Rogers is an international investing legend and inspiration for me personally.
https://www.codiesanchez.com/blog/2017/8/14/jim-rogers-investing-legend-original-nomad
24. Write up on Jim Rogers. Pay attention to this guy.
https://ckarchive.com/b/v8u3hrh6gq37
25. One of my favorite thinkers. Balaji S Srinivasan. Worth listening if you want to understand the future.
https://www.youtube.com/watch?v=F4RTXF1JX0E
26. Part 2 of this amazing interview. Info dense discussion with Balaji.
https://www.youtube.com/watch?v=eDvTrw7QW6E
27. "But a new wave of aging pros competing and winning at the highest level is showing how you can age not just gracefully but masterfully. I'm thinking of Tom Brady (44), LeBron James (37), Chris Paul (36), Serena Williams (40), Sue Bird (41), Cristiano Ronaldo (36), Lionel Messi (34), Phil Mickelson (51), and Roger Federer (40). And I could go on: It's not just one sport, or a few outliers, or veterans transitioning into supporting roles. It's a sports-wide revolution.
And you may have heard about the out-there things they're doing to maintain their bodies: Brady has so optimized his nutrition that he tries to avoid coffee and even tomatoes. LeBron reportedly spends more than a million dollars on his body annually, on everything from cryotherapy to pedicures.
But beyond the expensive equipment and the sometimes dubious cutting-edge science, something bigger is happening: The greatest athletes are realizing that you can't play your way into shape; performance is a no-days-off, year-round lifestyle. It's the commitment to fundamental, practical routines that amateurs like you and me can learn from. The moves pros are using to delay their twilight by just a few years can help the rest of us feel and live well for decades."
https://www.gq.com/story/lessons-from-ageless-super-athletes
28. This is too bad. But also shows how challenging and early we are in growing IoT space.
29. Tech growth stocks, especially in B2B side may be oversold. I like them for the long run.
"Buying growth stocks on the cheap will remain a good strategy for long-term capital growth.
Timing is difficult, though, and no one will ever manage to catch stocks exactly at the bottom.
However, what you do have full control over is to pick companies that are not at risk of going out of business if the market takes longer to turn around. Also, you can (and should) focus on businesses that have a track record of growing even during periods when financial markets and the broader economy are weak.
That's why I have long been a proponent of companies that run subscription-based business models. Such companies don't start at zero every year. Instead, they can tell you in advance how much baseline revenue they are likely to generate from existing subscribers. The steady cash flow doesn't just enable such companies to weather the storm, but they may also be able to invest in growth during times when others struggle to raise funding. Last but not least, some of them can increase their margins by "upselling" their customers to additional services."
30. "There are countless examples over the last few years that should shake VCs awake and help them realize there are a lot of founders in a lot of sectors at a lot of stages and they don't all want the same thing. Folks like Boldstart proved that founders are prioritizing people who will actually help them over big brands. Stripe proved that corporate VC's can be fast-moving value-add partners. Tiger proved that some founders just want to be left alone!
Very few firms have a clear answer to the question "what is your differentiated product?." There has never been a better time for venture firms to stop and think about what a product-led venture firm would do."
https://investing1012dot0.substack.com/p/productization
31. This is a very disturbing discussion but its important. Possible negative scenarios for the world order but better to understand prepare. Its very worthwhile.
Chaos=Disorganized violence & Decentralized & massive opportunities/Upside/failure
Order=CCP: Organized, Stable and centralized violence
https://www.youtube.com/watch?v=nlEStTMauBg
32. Very wise reminder and write up here. Especially as we've seen our investment portfolios get decimated in last few weeks.
"Focus on what matters. Be a Stoic in the face of temptation. Use Time to your advantage. Diversify your investments.
In any economic climate, how do we build economic security, foster love, and find joy? How do we get rich?
Slowly."
https://www.profgalloway.com/the-algebra-of-wealth-2
33. A very cogent discussion on the Ukraine-Russian (and EU/USA) crisis.
https://adamtooze.substack.com/p/chartbook-68-putins-challenge-to
34. This is a really interesting company with some impressive people at the helm.
https://a16z.com/2022/01/25/investing-in-prologue
35. For anyone who cares about democracy or self sovereignty this is worth reading. The place is worth defending.
Ukraine has its problems but it has changed alot in the last 8 years as someone who has been going there since 2007.
No one wants war, either regular Ukrainians or Russians that I know.