Marvin’s Best Weekly Reads November 10th, 2024
"Success isn't always about greatness. It's about consistency. Consistent hard work leads to success. Greatness will come." —Dwayne Johnson
"When you look at manpower, the Russian government has significantly increased the payouts and benefits to recruit personnel. The reason for that is straightforward. It’s clear that at this rate of loss, the Russian contract recruitment campaign is unable to keep up. This too does not mean that Russia is going to run out of manpower, but it’s clear that they’re struggling, and they are not likely to be able to sustain this pace of operations, staying on the offensive with this rate of loss.
The way I would put it is that the Russian military is actually operating under significant constraints. Given the likely decline in the relative advantage at the front line, Russia’s potential negotiating position actually isn’t all that strong. And while Russia has the resources to sustain the war in the near term, looking just a bit beyond that you see a fairly problematic picture in terms of the rate of inflation in Russia’s overheating economy, the deficit of skilled labor — because the state is pulling workers into the defense industry and contracting them to fight in the war — the steady depletion of Russia’s liquid reserves, and the fact that much of the budget is tied to the current oil price. The economic picture for Russia isn’t particularly rosy. The effort to juggle several different parts of this equation may not be sustainable. And this too must at some point weigh on the Russian leadership’s mind."
https://nymag.com/intelligencer/article/ukraine-war-why-russia-is-in-more-trouble-than-it-looks.html
2. This is a grim outlook for geopolitics and the economy from Simon Hunt.
https://www.youtube.com/watch?v=wMxgtbmOU1E
3. "Here’s the bottom line: In this next new era, risk capital available for startups will be much less concentrated in a few Sand Hill Road firms doing old-school equity financings. It will be much more distributed, and much more diverse in the ways that financings are structured.
For entrepreneurs, I think this is a good thing. As I’ve written before, I don’t think the unicorn obsession was necessarily good for us.
2025–2035 will look a lot different than 2010–2022. And I am so here for it."
https://medium.com/@bretwaters/the-venture-capital-landscape-changing-c762f33e8c73
4. Educational conversation on the race to AGI.
https://www.youtube.com/watch?v=wMQoDRTWwUg
5. What a terrifying new world of war.
https://www.youtube.com/watch?v=EEXI6r08908
6. "How good of a CRM could a software company build with a $10m annual budget & with AI? It’s the equivalent bet to funding a startup with a $20-30m Series A & a big design partner.
Technology is always commoditizing itself. Perhaps bespoke software will have the same impact in sales as in customer support. That would provide Klarna a sustainable competitive advantage over time.
It’s also a forcing function to require the organization to rethink their workflows in the age of AI. More than just changing software, burning the boats & forcing a company to reimagine workflows with a blank slate can be a powerful way to drive innovation."
https://tomtunguz.com/klarna-ai/
7. This is always a good show for learning what's up in Silicon Valley.
https://www.youtube.com/watch?v=xHEt2HLxRfU
8. More on what's up in Silicon Valley. Definitely right title: "The crisis in venture" with GV's MG Siegler.
https://www.youtube.com/watch?v=UMizwOPI3w8
9. Strong views whether you agree or not and this is great. Glad to see a more outspoken and authentic Silicon Valley.
https://www.youtube.com/watch?app=desktop&v=CgEWwL_wwQk
10. This looks damn good. Inspiration for training.
https://www.youtube.com/watch?v=Q4gz6Kwpotw
11. The global war broadens unfortunately with North Korean troops training in Russia in preparation to go to Ukraine, opens up massive implications geopolitically.
https://www.youtube.com/watch?v=T0uYxK66VLU
12. Talk about an OG Defense-tech investor. This was incredibly insightful. Strong recommendation.
https://www.youtube.com/watch?app=desktop&v=idpsqCH2VTA&t=3s
13. "My recommendation is to articulate a clear vision, sell the future, and then continuously adapt, solicit feedback, and iterate. The vision is seen, but the journey to achieve it is unknown."
https://davidcummings.org/2024/10/12/the-vision-is-clear-but-the-journey-is-unknown/
14. "Yet Britain’s resolve will only truly become clear if and when a contest for polar assets — or indeed fully-fledged polar war — finally arrives. And in the event, any showdown could come sooner than we think. Long-term oil reserves are one thing. But Russia also has a profound strategic interest in the Arctic in the here-and-now. Last February, Norway’s normally reticent intelligence service publicly warned that nuclear weapons could be present on Russian vessels in the High North. No less important, Sweden and Finland’s accession to Nato also brings the possibility that Western nuclear weapons might be deployed in the Arctic too.
China, for its part, needs the Arctic as well. With sea lanes in the Red Sea threatened by the Houthis, and the Panama Canal with problems of its own, Beijing needs a reliable route from its port at Dailan to Rotterdam in Europe. The Arctic is the obvious choice here, not least when Chinese ships can now make the journey in less than 25 days, and when its economy would surely struggle without it. Britain, in short, seems unwilling or unable to exploit its polar bounty. But its future here may ultimately depend on decisions taken by others — something Keir Starmer and his admirals would both do well to remember."
https://unherd.com/2024/10/britains-coming-polar-war/
15. Mike Maples Jr is a legend. This is an insight deep conversation in startup investing.
https://www.youtube.com/watch?v=b_lqGHKHi5M
16. "In this post, I’ve argued that the primary goal in organization design should not be reducing of span-of-control, but in surfacing conflicts most important to the company. I’ve also introduced a value-add rule that says no department should report into an executive who can’t add value to it. And finally, knowing that consolidation is inevitable over time as a successful company scales."
https://kellblog.com/2024/10/12/design-your-organization-for-the-conflicts-you-want-to-hear-about/
17. A masterclass in founder selling. And software sales in general, especially for enterprise sales. Learned a lot personally.
https://www.youtube.com/watch?v=ROsrlUFAVZs&t=887s
18. I had to watch this. Of course, both Mearsheimer & Sachs are anti-Ukraine which is wrong in my view. Jeffrey Sachs is very much naive in my opinion, CCP is absolutely a massive threat. CCP is pushing aggressively in South and East China seas. I agree more w/ Mearsheimer's view.
https://www.youtube.com/watch?v=uvFtyDy_Bt0&t=13s
19. Geopolitical take here on China and the fight for African resources between China, USA, France, Russia, UAE & Turkey among others.
https://www.youtube.com/watch?v=z2PJF9_9w4w&t=1s
20. "Ten to twenty years ago, none of these worrying laws or actions enacted by our governments were commonplace. Today, they’re growing at a rate that should terrify us all.
Where will we be in another decade from now?
Sure, people aren’t yet being arrested in the West for wearing a t-shirt the government doesn’t like. But we’re very close to that being the case."
https://anticitizen.com/p/heads-will-roll
21. Worth watching if you want to know where AI and compute is going. BG2 is the best show on tech biz right.
https://www.youtube.com/watch?v=Z77jZkYDpIE&t=1736s
22. "Since 2020, according to published reports, the United States has been urging countries in the region to avoid using a Chinese company to repair or lay new cables at the bottom of the sea out of concern that China could intercept and monitor sensitive communications passing through the cables.
It has also been urging companies to route new cables around the perimeter of the sea, avoiding the central part of the waterway claimed by China based on historic maps showing a 10-dash line that infringes on the exclusive economic zones of several other countries.
In what may be an act of retaliation, according to a Washington Post report this month, China has been delaying — sometimes for months — its approval of permits for companies to repair or lay new cables under the sea. The delays have been particularly troublesome for countries such as Vietnam, which is anxious to replace five aging cables that have failed repeatedly, slowing internet traffic in the country.
In the past four years, the U.S. government has blocked at least three cable projects that would have linked the United States to Hong Kong because of concerns that China could spy on or sabotage communications, the Post reported."
23. A deep dive into the future of AI with the man driving much of this. Jensen of Nvidia.
https://www.youtube.com/watch?v=bUrCR4jQQg8
24. "But it's also true that VCs and founders have kept chasing the ghost of pandemic-era valuation excess, thus stymieing exit efforts.
Moreover, Biden had presided over very strong public stock markets that have proven welcoming to IPOs — which is where VCs historically have made their strongest returns — but too many VCs have become so "founder-friendly" as to become lousy fiduciaries.
The bottom line: The VC market's cowardly chickens are coming home to roost."
https://www.axios.com/2024/10/11/venture-capital-deal-slow-liquidity
25. An excellent discussion on what's up with Silicon Valley VC: AI & Defense Renaissance.
https://www.youtube.com/watch?v=nXHQfhQrhfs
26. Incredible & insightful discussion on the art of seed stage investing. This is worth watching a few times.
https://www.youtube.com/watch?v=njgJ4w9DAao
27. "Meanwhile, in pre-Columbus North America, native tribes were engaged in a constant state of territorial warfare. Far removed from the Disney depiction of Native life, to borrow from Hobbes, life was indeed brutal, nasty, and short. With no common language, values system, or acknowledgment of property rights, it was every clan for themselves.
The strong persevered, and the weak perished. Tribes maneuvered almost like gorillas in the wild. Outsiders were deemed a potential barbarian who must be dealt with violently in the interest of self-preservation.
Native Americans failed to truly thrive, and there is no indication it was because they were somehow less intelligent."
https://www.dossier.today/p/why-the-left-canceled-columbus-day
28. This makes me both angry and sad. Disgusted at the lack of strategy, the cowardice and weakness of the USA & Europe. We have let down Ukraine & set them up to fail but it's not too late to turn things around.
"What would a betrayed Ukraine look like? At least it would retain some 82% of its territory. A guilty West would doubtless provide aid to rebuild infrastructure. It might be given a pathway to eventual EU membership (unless that option had been bargained away at the negotiating table), but joining the Western club may have lost its appeal at that point. Ukraine’s corrupt oligarchs would re-emerge from hibernation. The old post-Soviet cynicism would replace the youthful enthusiasm of the Maidan generation. There would be antagonism towards those returning from abroad after avoiding the fight, and – of course – thousands of grieving families.
This should have been Europe’s war to manage. In spite of decades of discussion about European defence, it proved too convenient to rely on US largesse. This made Europe a prisoner of US electoral factors. It also caused Europe to shirk the difficult decisions that helping win the war entailed: the big increases in defence expenditure, the 24-hour working in ammunition factories, the hikes in food and energy costs and the political risks such as seizing frozen assets. What remains now for Europe is to secure a place at the negotiating table and to argue for NATO membership for Ukraine as part of any settlement.
Failing that, the West will have years to repent the betrayal of the courageous Ukrainians, whose only crime was their wish to join the Western democratic order."
https://rusi.org/explore-our-research/publications/commentary/impending-betrayal-ukraine
29. This is motivating and helpful for any budding entrepreneur. We can all learn from Alex Hormozi.
https://www.youtube.com/watch?v=WO5m-roVzjg
30. Good discussion on investing in AI. A good VC needs to be a historian.
https://www.youtube.com/watch?v=QsV2avKGXQM
31. "I’m not a fan of lifetime value (LTV) in startups (how can one predict a 7 year customer lifetime value if the company isn’t yet 7 years old?) But for public software companies with these sparser economics, LTV becomes an important determinant of whether & when to invest more in growth.
If paybacks are 4.5 years & LTVs are five years, that data should provoke strategic questions about the company operations."
https://tomtunguz.com/why-ltv-matters-more-in-2024/
32. "The most interesting point that was focused on was Taiwan. The conclusion of everyone I talked to or overheard talking about China was that Taiwan is a when, not an if. The universal conclusion of what happens after China takes Taiwan - slowly or quickly depending on who you ask - is that China won't face consequences for that. The sanctions mechanisms that have been used to attempt to harm smaller countries like Russia and Iran - who have continued to trade with China - wouldn't work at all on China.
The shipping companies wouldn't have anybody left to trade with. You'd likely have some companies that would only trade with western approved counter parties - but in general, any attempt by the west to prevent ships from loading in China - a country that builds more ships now than any other nation, drives half of global commodities demand, and serves as the world's factory - would be so disastrous that its implementation wouldn't even be attempted. If you believe the shipping guys, the United States has already lost its world leadership position. China is everything.
I don't think people are really willing to talk about what the end of US hegemony means - I brought up "US currency devaluation" several times and I think nobody really liked that topic. But the fact that all of these people - who have their finger directly on the pulse of global trade - see a US/China conflict, or even just China facing any consequences or resistance at all for invading Taiwan - well it tells you an awful lot about how much the world has changed over the past 30 years. China was still barely an industrial power at the end of the 1990s. Now they are the power."
https://calvinfroedge.com/insights-from-capital-link-forum-2024/
33. "And now we come close to the heart of the Art Deco movement: it was futuristic while having one eye in the back of its head. That was the secret to its genius. It embraced machines, new materials, and the future...while never forgetting the primal value of beauty."
https://oldbooksguy.substack.com/p/why-art-deco-is-making-a-comeback
34. "We know that war is inflationary. We understand that the US government must borrow money to sell bombs to Israel. We know that the Fed and the US commercial banking system will buy this debt by printing money and growing their balance sheets. Therefore, we know that Bitcoin will rise stupendously in fiat terms as the war intensifies.
What about Iran’s military expenditures? Will China/Russia help Iran’s war effort in some way? China is perfectly willing to buy Iranian hydrocarbons, and China and Russia sell Iran goods; however, none of this trading is done on credit. In a cynical sense, I believe China and Russia will act like the clean-up crew. They will publicly denounce the war but do nothing of note to attempt to prevent Iran's destruction.
Israel is not interested in nation-building. Instead, they would delight if, as a result of their attacks, the Iranian regime crumbled due to popular unrest. China, in particular, could then roll out its preferred method of diplomacy. Loan a newly formed weak Iranian government funds to rebuild their country using Chinese state-owned firms. That, in essence, is the Belt and Road program Chinese President Xi Jinping has pursued throughout his reign. Then Iran, with its massive deposits of minerals and hydrocarbons, would be fully within the Chinese orbit. China obtains another captive market in the Global South to dump its overproduced, high-quality, and low-priced manufactured goods. In return, Iran sells China cheap energy and industrial commodities.
If you want to call it that, the support from China and Russia will not expand the global fiat money supply. Therefore, it will have no discernible impact on the fiat price of Bitcoin.
An intensified Middle Eastern conflict will not destroy any critical physical infrastructure supporting crypto. Bitcoin and crypto will rise as energy prices spike higher. The hundreds of billions or trillions of newly printed dollars will re-energize the Bitcoin bull market."
https://cryptohayes.substack.com/p/persistent-weak-layer
35. "So what do you have to do at seed? You have to go further out on the risk curve, to something that’s weirder, different, or too early for a later-stage investor. Early, but not too early: hence the “12-36 months” phrasing. If you go too early and either the technology or market is not ready, the company may run out of money before you hit an inflection point. Finding an idea whose time has finally come with a multi-decade tailwind driving your potential is critical to building a generational venture-backed company.
A good litmus test I’ve been using recently is: “If I asked someone who works at a middle-of-the-road Series B/C fund about this company, would they react with skepticism or excitement?” If it’s the latter, I worry that the market is already defined and obvious and it’s too late for me.
If it’s the former, there might actually be something there."
https://pratyushbuddiga.substack.com/p/what-do-you-invest-in
36. Jeff does a good job on the state of the venture capital market right now: signs of consolidation. Really interesting, specifically with his view on the emerging manager sector.