Genetics

[VIC – 94] D2C 🚑 healthcare. 💩 on the fan. Interesting tea flavors ☕ . Stop losses and OTC stocks.

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Business & Money

The direct-to-consumer (D2C) model might be one of the most transformational things happening in retail right now. You no longer have to spend millions on TV commercials to make people aware of your products. You don’t have to own distribution or fight for shelf space in big box stores. Brands like Warby Parker and Dollar Shave Club have built massive businesses by cutting out the middleman and building direct relationships with their customers.
While this is all good and well (lower prices, better service, etc), I believe there’s another vertical that might benefit from the D2C model even more. Healthcare. The market is incredibly broken, and one reason is because you have this convoluted system where companies don’t care about people. And why should they? Companies don’t make any money from the end users of their products. Instead, they’re paid by insurance companies (often called payers). So the incentives are all screwed up. There might be a treatment option that is best for the consumer, but if it isn’t covered by payers, provider go with a different option.
So how do you effectively reach a D2C type model in healthcare? There are a lot of people searching for an answer, but one interesting example is a company called 23andMe. They’ve built a D2C genetic testing kit that circumvents all of the BS mentioned above. They mail you a testing kit, you spit in it, and mail it back. 8 weeks later you can log in to their app to review tons of different reports detailing what your DNA has revealed about you. But how do you really get people interested in personal genetic testing? The early trick was ancestry. People were really keen to find out where there were from or if they were likely to inherit that shiny bald spot on top of dad’s head. But I think this part was a marketing ploy. What 23andMe is really after is a massive database of genetic data. A couple coincidences for you:
Anne Wojcicki, 23andMe’s CEO and a co-founder, is the sister of Susan Wojcicki (CEO of YouTube and a former Google exec) and the ex-wife of Google co-founder Sergey Brin.
Brin and Google lead 23andMe’s series A investment round of $3.9 million (they’ve since raised an additional $483 million and I imagine Google has followed on to retain its ownership stake).
I wouldn’t be at all surprised if Google acquires the company in the not too distant future. And it would make perfect sense. The world’s leading search company acquires a company that has built the largest database of perfectly organized and searchable personal genomics data. Sounds like a match made in heaven.

Human Progress

I’m reading an incredible book called The Sovereign Individual. It’s all about massive and foundational changes to the trajectory of human development. One such moment it mentions is the fall of the Roman empire. The book describes how in modern times, with the benefit of 20/20 hindsight, most historians easily classify the capture of the Roman emperor Romulus Augustulus as the defining moment signifying the collapse of the empire. But at that moment, most Roman citizens and many of the surrounding peoples didn’t realize the significance of this event. Even Charlemagne, who sat on the Roman throne some 3 or 400 years later may have been under some false pretense that the crown was still intact. It wasn’t until much later when people began to realize that Rome was no more.
I point this out because it would seem that this is always the case for the ruling group at any point in time. Specifically, I am thinking about right NOW, our present moment in history. The US has the largest economy on the planet. Many of the leading companies in the world hail from our shores. We purportedly hold military supremacy over all other nations. You could point to many data points that say we’re on top.
But things are also getting pretty strange. We’ve elected Donald Trump to the highest office in the land. Perspectives among our population are becoming ever more polarized. The US dollar is faltering (not to mention what crypto might mean for reserve currencies and the financial system more broadly). All this to say that you could look at a different set of data points that say we’re standing on shaky ground.
Is this the moment when the 💩 hits the fan? Is this the moment when the US goes into secular decline? Of course, there is no way for us living in the moment to really know the answer. But there is the possibility that historians will look back on this moment as the moment that the US got knocked out of the top spot.
It’s an interesting idea and one worth spending some more time with.

Philosophy

A couple weeks ago my fiance wasn’t feeling well and wanted some tea. We went to the local corner store to see what types of tea we might find. They had chamomile, ginger, black tea, herbal tea, green tea, and a bunch of other teas. She stood in the tea section for what felt like forever trying to make a decision (she always takes forever in any store, even when we’ve already established that we are there for one specific thing). After walking around aimlessly perusing random aisles, I finally joined her in the tea section to see if I could speed up the process. It turns out that, because she’s rather tiny, she missed an entire section with a bunch of other interesting tea flavors that were perched on a higher shelf. I pulled a bunch down and to my delight, I was holding one that she was looking for. We made the purchase and were on our way.
On the walk home, I found myself ruminating about the tea experience further. I was thinking about the fact that what happened in that Duane Reade tea isle actually happens all the time in life. One person with a specific perspective and vantage point will see a situation completely differently than another person. It happened to be a physical difference in height in this scenario, but more commonly it is differences in perspective that stem from our various sets of experience, differing value systems, and all of the other things that lead to human subjectivity.
I believe it to be invaluable to surround yourself with people in this life whom you really respect and admire, but are from completely different walks of life. It’s the only way that you’ll see those really interesting tea flavors on the top shelf. ☕

My Latest Discovery

I’ve been talking about stop losses a fair amount here on VIC of late. It’s recently come to my attention that you can’t use stop losses for many OTC stocks. I’m bullish on Chinese internet companies, especially Tencent (maker of WeChat), so this limitation is a problem for me.
Just wanted to make you guys aware of this in case you were planning to invest in any OTC securities. For now, my approach is to simply use price alerts to make sure I’m aware of any big price movements. But all ears if you guys have other ideas.

Friendship

[VIC – 93] I hit the lottery!

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Taking a break from the normal format this week because a thank you is due. Take a look at this picture:
What do you see? If you look closely, you’ll see me hitting the lottery. The friendship lottery. And the payout is infinite. It’s the gift that keeps on giving.
This crew just gave me the best bachelor party that a man can ask for. Seriously, it was like a dream that was so incredible that you don’t want to wake up.
Perhaps that’s why I stayed up so late last night. I thought that, just maybe, if you don’t go to sleep, the next day can’t come.
Unfortunately, I was wrong. But it’s not all bad because this dream actually doesn’t have an ending. It’s real. I get to spend the rest of my life with these people.
And like I said at dinner last night, I love each and every one of you and I hope that I can be half the friend you are to me. I’m not one for getting all emotional and sentimental, but I feel completely comfortable knowing that I cried like a baby last night out of pure happiness.
I can’t wait to celebrate again with these incredible people in a few weeks. Thank you all for being you!
Investing

[VIC – 92] Naked people in the streets. Individual sovereignty. Go with the flow. Golden Week.

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Business & Money

I’ve been working through Howard Marks’ Memos over the last few weeks, and I couldn’t be more thankful for the recommendation from a close friend. The memos are wonderful.
As a result of reading a few, I realize that I have been falling into one of the traps that so many investors fall in to, getting far too confident during a bull cycle. You start making bets than you otherwise wouldn’t. It’s so easy to fall into this trap thinking everything that you touch will turn to gold. Luckily I read a few of these memos before anything bad happened.
And hey, who knows? Maybe the market continues to rally for another year. Or maybe 5 or 10 years.
But I also know the law of large numbers. I know that over long periods of time, things will regress to the mean. I know that this time is NOT different.
So here’s what I’m doing to protect my downside:
There are a group of stocks known as the dividend aristocrats. These are stocks that return money to shareholders on a consistent basis in the form of dividends. And the great thing is that these stocks generally perform better than the market during a downturn as compared to the S&P 500. I’m shifting a higher percentage to these assets.
I’m decreasing my positions in companies that are not profitable and shifting towards those with extremely healthy balance sheets and lots of cash on the books.
I’m selling off some crypto to rebalance the portfolio and reduce risk.
I’m tightening up some of my stop losses.
I’m planning to keep 10-15% of the portfolio in cash to be opportunistic.
Buffet always says you have to be greedy when others are fearful and fearful when others are greedy. Let’s just say I see a lot of greedy MFers running around naked in the streets!

Human Progress

I regularly read a blog called Stratechery. It’s author, Ben Thompson, is an incredible journalist, business strategist, and technologist. He goes deep into the companies and topics he writes about. I have no idea how much money he makes, but at $100 per year for the annual subscription, I’d imagine he makes a few hundred thousand dollars per year just with the blog, if not more.
I’ve also recently kicked off a virtual meditation retreat led by David Cohn. David writes another of my favorite blogs called Raptitude. He built a significant following on the blog writing about meditation and mindfulness, then parlayed that into running these virtual retreats. Again, no idea about his financial success, but Imagine he does well. After day 3 of the retreat, there are hundreds of comments and likes on the meditation forum. At $67 for the 30-day retreat, it only takes 1500 participants to crack $100,000 in revenue.
I’m currently reading a book called The Sovereign Individual (highly highly recommend it). It’s about how individuals will have increasing sovereignty as we transition into the information age, and old paradigms of power and control (i.e. nations, corporations, political affiliations, financial institutions, etc) will have less control over us.
The internet is an incredible means to individual sovereignty. A single person with a passion, a WordPress site, and a bit of work ethic have the ability to make a life for themselves. And a good life. And it doesn’t matter where you live, what you look like, or who you choose to have sex with. There is absolutely nothing holding you back and no reason you shouldn’t exercise your sovereignty.

Philosophy

I’ve noticed this thing I sometimes do when reading content online. I quickly scroll to the bottom of the page to get a sense of the length of the article. I basically refuse to start reading, if I cannot first set my expectations about length and duration.
The interesting thing is that I even do this when reading my favorite authors and blogs. Despite the fact that I’ve already established a fondness for the writer and subject matter, I still have to set proper expectations before diving in.
I’m not sure if this is a good thing or a bad thing. Or perhaps it’s just a thing. But I noticed it. And I think it’s worth thinking about.
I think a lot of “suffering” in life is due to this constant expectation setting. You often hear about how someone is so disappointed about the outcome of a particular situation. But, of course, there would be no disappointment were it not for expectations.
Don’t get me wrong. Setting goals and having aspirations is an important exercise. After all, without a target, how does one set their aim?
But sometimes it’s also important to just dive in, to stop asking questions, and go with the flow. To try something new. To step outside of your comfort zone.

My Latest Discovery

Apparently this past week was “Golden Week” in China. It’s a 7-day national holiday to celebrate the founding of the PRC.
It’s estimated that nearly 700 million people were traveling this year during Golden Week, which is a 10% increase over last year. 700 million?!?!? That’s half of China’s population and 10% of all humans on the planet. That’s 🍌🍌🍌🍌!! (been a while since the 🍌s made an appearance here on VIC – feels good to bring em back 😉 )
Apologies, for bringing this one full circle back to the finance section, but I can’t help it. Everyone’s already aware of the rapidly growing middle class in China, which means the traveler numbers will likely keep going up. And most of these people are booking their flights and accommodations on Ctrip.com (CTRP). Ctrip is basically the Priceline of China. Have you seen the Priceline stock chart over the last 10 years? I’ve owned CTRP for a while now, and will likely keep adding to the position. Don’t sleep!
Of course, the health of the markets will have an impact on discretionary spending in the short term, but from a long-term perspective, China appears to be going up and to the right.

Cryptocurrency, Electric Vehicles, ICO, Investing, Tesla 3 Comments

[VIC – 91] Overvalued is horse shit. ICO 101. Damn millennials. Don’t close your apps.

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Business & Money

Early this year I sold my Tesla (TSLA) stock. It had gone up a bunch over the years and the markets were (are) feeling frothy, so I decided to cash in and walk away with the gains. Of course, it has gone up an additional 20% this year and I’m sitting here feeling like an idiot. That said, I’ve noticed a couple other things that I thought were worth sharing.
The first is that there are a couple of foundational pieces of technology that are large drivers of success for Tesla, one being the lithium-ion battery pack.

There are 7,000 individual batteries in one battery pack. And now, given Tesla’s success and a growing global consciousness about climate change, you have every other major car company saying that they will switch all models to electric, and thus lithium-ion battery packs, in the next 5-10 years (unless some other breakthrough comes from left field). So lithium will be in very high demand. If TSLA feels too risky for you as an individual stock, I’d recommend the Lithium ETF (LIT) which gives you exposure to the entire category (lithium miners, battery manufacturers, EV companies, etc) as a hedge against any one specific bet.
The other key factor I was referring to driving Tesla’s success is, of course, artificial intelligence, but I write ad nauseum on that subject here on VIC so I’ll leave it alone today.
The other thing I’ve noticed as a result of selling TSLA is that there is a lot of talk about the market and individual companies being overvalued. And in some respects that is true. If you use traditional valuation metrics like P/E, EV/EBITDA, and the like to compare a company to historic multiples in the category, then yes, the market is expensive. But what I’m realizing more and more is that there are a lot of things that aren’t captured in ratios and financial statements. If you look at Amazon’s filings, where is Jeff Bezos. He’s not on there. There’s no entry for “visionary CEO” on an income statement or balance sheet. There are no entries for durable competitive advantage or strong network effects. I believe it’s far more important to think about the fundamentals of the business, rather than a simple mathematical exercise, and why it will be successful in the long run. Most of the great companies of our day are always “overvalued.” My thinking has shifted considerably to take “overvalued” as a strong buy signal. Perhaps the term is just horseshit altogether.

Human Progress

I’ve gotten the question about how to participate in ICOs a bunch of times, so I figured it was time to write a quick blurb. For the uninitiated, ICOs (initial coin offerings) are a means by which startups and blockchain-based projects raise capital. In short, the company initiates a crowd sale of tokens (think Bitcoin or Ether, but specific to that company or project) to the public. This year ICOs have raised over $1 billion, with the largest individual sales raising over $200 million (Filecoin and Tezos have been the largest and most talked about).
So how to participate.
First, you have to acquire Bitcoin or Ether. The easiest way to do so is via Coinbase, the leading crypto exchange and wallet. You just open an account, connect a bank account, and purchase your token of choice. Keep in mind that, because this purchase happens via a traditional bank, the transaction will take a few days to settle. So if you want to participate in an ICO, you’ll want to purchase Bitcoin/Ether a week in advance.
Second, you’ll need to transfer your Bitcoin/Ether to a wallet you control. With Coinbase, you don’t own your private keys, so that won’t work. The way ICOs work is that you send tokens to a specified address, then a smart contract is executed and your desired tokens are sent back to your address. You need your private key in order to access those tokens. I use My Ether Wallet for this.
Third, participate in the ICO by sending your Bitcoin/Ether to the appropriate address. The company hosting the sale will provide the address where the funds are being collected during a specified window of time. Be careful here, though, because hackers and scammers will try to replace the correct address with their own, stealing any funds sent to their address, with no recourse. They’ve been successful to the tune of millions of dollars.
Last, and especially if we’re talking about considerable sums of money, you’ll want to store your tokens in a cold wallet, aka one this isn’t connected to the internet. Hardware wallets are best for this, with Trezor and Ledger being the most popular.
Hopefully this helped. Be careful out there!

Philosophy

I often write here on VIC about the positive effects of the internet and technology. But one not-so-positive side effect is that we increasingly live in a world of instant gratification. If you want to go on a date, just swipe right and viola! One date coming right up! Hold the awkward meandering up to a group of strangers in the park. Hungry? Not for long with Seamless or GrubHub at your fingertips. Feeling down, just post a picture to Instagram so everyone can like it and stroke your ego.
At every turn, it seems, every need can be met in an instant. The problem is, when it comes to important things like meaningful relationships or fulfillment at work, there’s no quick fix. Substantive interpersonal connections require a sustained and genuine interest in another person’s affairs. If you want to find meaning at work, there will likely be a ton of long hours, frustrating conversations, and uncomfortable situations. And while none of these are fun in the moment, I’d say they’re almost a requirement for anything worthwhile.
This might be the primary reason that people ascribe laziness and entitlement to millennials. You have an entire generation of people that are expertly trained in instant gratification. How you can you blame them (us) for expecting to get exactly what they want when they want it.
And what’s more, many of the needs currently met by technology were previously met by other people. Individuals look to social media for their self-esteem and their sense of well-being, instead of relying on friends and family. This likely leads to underdevelopment in communication faculties and an inability to cope with stress in effective ways.
What you have here is the perfect recipe for what I’ll call the millennial psychosis. And given that the pervasiveness of technology in our lives is sure to increase over time, the future looks rather bleak.
I wish there was some easy answer or magical cure, but there isn’t one in sight. That said, I AM a firm believer that making space in your life to be free of technology and instant gratification is a good start.

My Latest Discovery

I was recently speaking to a friend who happens to be an iOS engineer. As we were walking side by side, he noticed that I had pulled my phone out of my pocket, and was in the process of force quitting a bunch of apps to conserve battery life. He proceeded to tell me that this was futile. He claimed that the power required to reboot an app from scratch was likely equal to, if not greater than, the power used by an app sitting idle in the background.
I’ll have to fact check this one, but an interesting insight none the less.

Apple, Meditation, Mindfulness, Uber

[VIC – 90] Lift raising capital. Paradigm shifts in computing. No mac & cheese. Camp Calm.

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Business & Money

Apparently, Alphabet (Google) is batting around the idea of a $1 billion investment in Lyft. This is funny and ironic for a whole host of reasons, but I’ll leave those for another day. The thing I’m really thinking about is, what if Lyft just accelerated IPO plans and listed early as a means to raise capital, instead of relying on the private markets?
This would poor serious gasoline on the fire that is the burning chaos over at Uber. First off, I doubt Uber’s private valuation would hold up if the market had an opportunity to value its closest rival. This would lead to serious markdowns from the late stage investors and mutual funds, more board disputes, and more disgruntled employees. It also might further delay Uber from going public to give it more time to grow into its private valuation. Further, it might give Lyft the opportunity to control their own narrative instead of constantly living in Uber’s shadow.
Of course, this is all really just an interesting thought experiment. Once both companies are public, who went first won’t really matter. But it’s interesting to think about nonetheless.

Human Progress

We went from mainframes to PCs, PCs to the internet, and from the internet to mobile. But what comes after smartphones?
Apple would like to think it has something to do with the Apple Watch, and they may be on to something. At their latest Keynote, Apple announced that Watch 3 comes with built-in cellular capability, which is the beginning of the watch’s untethering from the iPhone.
If you remember, this is exactly what Apple did with the iPhone. When the original iPhone launched, it required that you had iTunes running on a computer to be able to use it. That’s how you got your music, backed up data, and installed software updates. Then the app store launched and you could download all software over the air, stream music, and do anything else that software developers could dream up.
Now with Watch 3 + Airpods, the same thing is happening. You can start to imagine a world where you don’t actually need to carry around a smartphone all the time. And as Siri continues to improve, coupled with powerful NLP technology, Apple could be ushering in the next major paradigm shift in computing.

Philosophy

One of the things I love about meditation is the mindfulness that cultivates outside the practice itself.
I went to grab my normal lunch at Dig Inn this past Friday. When I arrived, I saw the macaroni and cheese looking fresh and delicious. Despite my elimination of dairy lately, I thought “maybe I’ll have a cheat day and treat myself to some mac & cheese.” Then not even a second later, I thought “nah, that’s just a temporary craving and I don’t really want it that bad.” The craving had appeared then disappeared in my mind, just like that.
Then I got to the register and the cashier proceeded to ring up the person in line behind me as if I wasn’t even standing there. I got annoyed for a half second, then it was gone. I was in no particular rush.
Then, as I proceeded to the cutlery station to retrieve a pair of silverware, that same girl who had been rung up before me viciously cut me off to get her silverware first. I stepped back, watched her walk away, and just had a little laugh to myself. It’s so confusing to me how rude people can be, while being completely oblivious to it. Haha. No big deal. I just sat down, enjoyed a wonderful lunch, and subsequently had a wonderful day.
All of these cravings and emotional responses just rise and fall seamlessly when you recognize them for what they are, and realize that they need not upset your mindset.

My Latest Discovery

I’ve written here before about how much I love Raptitude, “a blog about getting better at being human.” David Cain, the blog’s author, also runs a virtual mediation retreat called Camp Calm. Registration for the next session opens up this week if you’d like to check it out. It’s a very lightweight introduction to mindfulness and meditation. You won’t regret it.

Time

[VIC – 89] Fixed vs variable cost. Mesh networks. The uncanny valley. So many clocks.

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Business & Money

I work at a software company that provides a marketing intelligence platform (marketing intelligence = business intelligence for marketing). One of the things that make our offering different than technologies of yesterday is that we provide it as a SAAS platform, or software-as-a-service where customers can pay a flat monthly fee for the right to use our software from any web browser or mobile device.
Business intelligence in the old world was provided as most software applications were provided in the past. There was a huge up front cost for software installation & integration, then a small annual maintenance fee. In other words, customers recognize a big fixed cost up front, with negligible variable costs over time. In the SAAS model, there is no massive up front cost, but instead, a variable cost over time (based on usage) that gets recognized as an operational expense every month.
Most software is going the way of the SAAS model these days, but the fixed cost vs variable cost debate is alive and well. You can find a great example of this if you compare Snap(chat) and Facebook. These companies have taken a drastically different approach to their cost structure which could have massive implications over time.
Facebook has built 8 or 9 massive data centers (don’t quote me on that number) all over the world in which they’ve invested billions of dollars. They recognized these data centers as a massive fixed cost up front, with the variable costs over time (electricity, wages for employees working in the data center, etc) being relatively marginal compared to the initial investment. This means that over time, as Facebook has adds more users (closing in on 2 billion) and more advertisers to its platform, their margins and profitability have grown significantly. They are basically spreading that fixed cost over more and more users and customers as they scale, which is a boon for the business model.
Conversely, Snap has decided not to invest in their own data centers, but instead rely on the infrastructure of other cloud providers (Google Cloud) for computing and storage. Thus, they’ve opted for a variable cost or operational expense model that continues to grow linearly as they bring on more customers and advertisers. Of course, they can negotiate better rates as they spend more money, but this model does not scale nearly as well as the one Facebook chose.
Not to say that Snap’s can’t succeed with its model, but it will definitely be much harder, especially given that they’ve chosen to focus on a much smaller niche market.

Human Progress

As the nation continues to be bombarded with increasingly powerful storms (cough cough.. climate change.. cough cough), one of the most important things to consider is cell phone coverage. As critical infrastructure and power grids fail, people often rely on wireless networks to call for help and stay tuned for the latest weather updates. But said infrastructure includes cell towers, which of course rely on electrical grids to stay on line and route calls and data. So what happens when the power goes out?
One startup I’ve kept an eye on over the years, goTenna, is trying to solve this problem. They’re building mesh networks which allow for communications to be routed via other mobile devices. So in an area without power, and thus no cell coverage, data can hop from device to device until it gets from sender to recipient. Thus, more wireless devices in an area equates to a stronger mesh network, while completely circumventing the traditional cell network.
This technology has the ability to not only improve communication during natural disasters, but also improve communication in any densely populated area or areas where coverage is hard to reach. Think about concerts, for example, where too many devices are trying to ping the same tower. Or in NYC when you’re traveling on the subway in between stations. And the best part? Since the number of devices is exploding with wearables, IOT, and the like, you are inherently increasing the strength of the network without building any additional towers or wireless infrastructure. The devices themselves are the network.
Here’s a quick video of the founder giving a presentation at the New York Times as part of their “Cities For Tomorrow” conference series earlier this year.

Philosophy

There’s this concept in the tech community known as the “uncanny valley.” It is the concept that is most often used to describe the development of humanoid robots (and artificial intelligence by extension). Basically, as we develop robots and intelligence technologies, for a long time these are very clearly non-human (take a Roomba vacuum or a Firby for example). Even when they start to stand upright and have a silicone covering that looks a lot like human skin, they lack the basic skills of non-verbal communication, the fluidity of motion, the ability to discern things like sarcasm or deceit, and a whole host of other basic underpinnings of being a human being, even if the outward appearance seems to suggest otherwise. Not until we reach near perfection on all of these “soft” components of humanity, would we be able to escape the “uncanny valley” where the robots are not too far from human, but still very creepy and easily identifiable replicas of ourselves.
But I believe this concept can just as easily be applied to areas outside of technology. Specifically, this week I’ve been thinking about it in terms of human psychology. There’s a long list of human deplorables where disassociation is fairly straight forward. Hitler, Charles Manson, Ariel Castro, Osama Bin Laden, you’d be hard pressed to find many people that would willingly associate themselves with these people. These are the robots that are very clearly non-human.
But then you have this huge gray area, this “uncanny valley” where individuals seem fairly human in some regards, but are merely creepy replicas. And these people are coming out of the wood work with increasing frequency. A number of people have dropped (or been forcefully removed) from my life because it became pretty clear to me that they lacked basic elements of what I consider to be core to humanity. Things like recognizing the fact that certain minority groups have been discriminated against and fundamentally disadvantaged in this country for a long time. And that these problems are still problems today. Things like embracing the idea that people that love each other, regardless of creed or color, should be encouraged and supported if they decide to spend their lives together in marriage.
In general, I’d say the world is stuck in an “uncanny valley” today. There are faint signs of equality and progress if you look closely, but it’s a mere replica of where I hope things end up at some point in the future.

My Latest Discovery

I never realized just how many clocks are in our lives. In my typical day, there’s the microwave, the oven, my alarm clock, both iPhones, my lap top, Apple watch, and a million other clocks in public spaces. I’ve discovered that looking at the clocks less brings more peace to my life. And I don’t really lose any sense of time. Given the routines of everyday life, and our natural instincts of time-based on the sun and what’s happening around you, you’d be surprised how accurate our sense of time is without ever looking at clocks.

I’ll be writing more about this one in the future…

Computing, Investing

[VIC – 88] Stop losses are for suckers. There’s Moore where that came from. Magnify your spirit. Narcoooos!

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Business & Money

I once had someone say to me “stop losses are for suckers” (a stop loss is when, after buying a certain stock, you set a lower limit on how far it can fall in price before being automatically sold. So if you buy a stock at $100, you might set a stop loss at $80, which means if the stock reaches that point it will automatically sell to protect your down side).
That sentence stuck with me for a long time, probably because I aint no sucker! 😂 But seriously, I had just kind of accepted it at face value without giving it much thought. When you really think about it though, it’s a load of crap for a whole host of reasons, including:
1) Stop losses take emotions out of the equation. Emotions are the investors worst enemy leading her to do incredibly stupid things.
2) Stop losses free up money to pursue other ideas. You obviously want to make your money back, but it might be easier to do so on other companies.
3) Stop losses give you flexibility. The great thing about the stock market is that you can make money whether the market is going up or down. If something important has changed, you need the flexibility to act on that new information. No reason to stay trapped in a losing position.
Now I know what some of you are probably thinking. There are always major drawdowns, even in the market leaders. Amazon, Apple, Google, Facebook, all have seen huge drawdowns and one time or another. Getting stopped out of those means you would have lost out on the incredible gains to come. Fair point. But there’s a far longer list of stocks that have tanked and never came back. Don’t anchor on the outliers. Plus, a stop loss does not mean you can’t come back in at a later point.

Human Progress

These days you often see people writing about the end of Moore’s law (Moore’s law, named after Gordon Moore of Intel, being the principle that computing power, or the number of transistors on a chip, doubles roughly every two years). But, while the pace of improvements to this paradigm are definitely slowing down, to say that Moore’s law is coming to an end is to miss the larger point.
Before integrated circuits (chips), early computers relied on punch cards and vacuum tubes to handle the heavy lifting. It wasn’t until the 1950s when transistors came on the scene.
So, I believe the real idea of Moore’s law is to say that we will continually find ways to improve computing power at an exponential rate, regardless of whether the underlying technology is a transistor moving around electrons on a slab of silicon.
Take quantum computing for example. Once, these are generally available for regular applications, we will see a sudden step increase in computational power. Modern encryption might become obsolete in an instant.
The human brain example of another form factor. Instead of transistors, we have this biological blob inside our heads with about 100 billion neurons layered on top of one another firing in incredibly complex patterns. This is why computer scientists have taken this idea and abstracted it to build what they refer to as neural networks loosely modeled on the structure of the human brain. However, while neural nets are incredibly powerful and this area of research fascinating, we should be wary to spend too much time aiming to replicate the biological version. This was the line of thinking when inventors tried to replicate bird flight by building machines with flapping wings. Then we figured out that a fixed wing system was far more practical and efficient for our purposes.
All this is to say that we’re in the early innings of our computational journey. Regardless of the substrate, we will continue to see exponential improvements with the potentiality of recreating the notion of intelligence altogether.

Philosophy

I often return to this “10 learnings” list by Maria Popova. She published it on the 10 year anniversary of starting her blog. It’s one of my favorites.
The one I love most from this list is “seek out what magnifies your spirit.” The language is simply beautiful and the idea even more so. I’d say it serves any human being well to make sure you find space in your life for whatever it is that magnifies your spirit.

My Latest Discovery

Narcos is back babyyyyy!! (no spoilers please!)

Blockchain, Business Strategy, Cryptocurrency, Diet & Nutrition

[VIC – 87] Power of defaults. App layer vs protocol layer. Intellectual flexibility. No dairy experiment.

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Business & Money

Apparently, Google is paying nearly $3 billion per year to be the default search engine on iOS devices.
This reminds me of when AOL was included as the default internet service on Windows when Windows 95 launched. You could search for and use a separate service, but there was a ton of friction in those days (remember software was sold on cd-roms in physical retail stores).
Being the default option is powerful. You don’t have to have the best product if you’re the default. You only have to be good ENOUGH. There are countless examples of this. Going back to Windows 95, it also came with Internet Explorer, which was Microsoft’s web browser. IE was not even close to being as good as Netscape Navigator. But it didn’t matter. IE was free and it was the default. Netscape’s dominant position in the browser market evaporated seemingly overnight.
Tied to this idea of being the default, is distribution. Again here, the product can be inferior if the distribution strategy is spot on. The direct to consumer model has started to change this a bit, but not by much. Distribution still matters a ton.

Human Progress

There’s something interesting happening with the development of blockchains. If you think about the internet in its current incarnation, there is no value capture at the protocol layer. No one got rich solely by creating or investing in open protocols (HTTP, TCP/IP, etc). Instead, all of the value has been captured at the application layer. The big internet companies that have built successful applications on top to the protocols have made all the money.
The reverse is true with blockchain. The market cap of Ethereum is north of $30 billion and Bitcoin is over $70 billion. But the most valuable companies that have built interesting applications on top of the leading blockchain networks might be worth a couple hundred million dollars, at the high end. Most of the value is accruing at the protocol layer.
This suggests that the internet of tomorrow might look vastly different than it does today. With data replicated and shared across a decentralized network, perhaps massive monopoly platforms will not grow to dominate their markets as they do today. Perhaps competition will be more vibrant as barriers to entry come down and new creators can emerge. Perhaps this is how it was always meant to be.

Philosophy

For a long time, I’ve been doing a certain thing a specific way. Recently, some one suggested I do it another way. I gave feedback that I didn’t think it would work for all of these conceptual reasons (not based on any evidence). Then a bit later, I witnessed some one else doing it the way it had been suggested to me. It worked perfectly and made complete sense.
I stretch a lot in the gym these days, sometimes even devoting an entire day to just doing it. But it’s clear my intellectual flexibility needs work. If someone that you trust and admire makes a suggestion, it often makes sense to give it a try, at least once or twice. Of course, there’s no guarantee that what works for them will work for you. But there’s a reason that that person holds your respect and admiration in the first place.

My Latest Discovery

I’ve been trying a bit of an experiment for the last couple of weeks. I’ve removed dairy from my diet to see if it makes me feel materially different (outside of one scoop of cookie dough ice cream that I couldn’t resist 😞 ). So no cheese on my chicken parm, no yogurt in my protein shakes, and I’ve even swapped out my normal whey protein supplement with a plant based protein substitute. Overall, I’d say I’ve noticed better digestion, a bit more energy, and my allergies seem to less of a problem. Planning to keep this up to see if the changes persist.

Digital Health, Free Will, Investing, Sleep

[VIC 86] Waiting for your pitch. Digital health. Free will. Trouble sleeping.

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Business & Money

A few weeks ago I went to a baseball game in Chicago for a friend’s bachelor party. It was a ton of fun.


For whatever reason, I was looking at this picture the other night and started to think about investing in terms of baseball.
In baseball when you step up to bat, there’s this concept of the strike zone. If the pitcher throws the ball within that zone, it’s called a strike. If he throws it outside of the zone it’s called a ball. What makes baseball tough is that you can’t stand around waiting all day for a perfect pitch. If the pitcher throws three strikes (regardless of whether or not you swing), you’re out and you lose your turn at bat.
In some respects, investing is like baseball. Every time you analyze a stock, that’s a pitch barreling down toward home plate. If you decide to make a purchase, that’s analogous to a swing. You might get a single and make a little bit of money, or, you might hit a home run and make a ton of money. You also might whiff and lose money.
The difference with investing, however, is that you’re never forced to swing. There’s no 3 strike rule. You can stand at the plate all day long waiting for that perfect pitch. You can wait day after day, week after week, month after month, even year after year. Only when you see the perfect pitch, and you have a ton of conviction, do you swing.
I’d say that’s one of the hardest things about investing, being patient and waiting for your pitch.

Human Progress

I’m excited to see how digital health will transform our lives.
I already wrote about my Teladoc (TDOC) investment here and why I’m excited about what they’re up to.
I also invested in Care.com (CRCM), which is an online platform that helps people find various types of care (senior care, child care, etc). Seems like another perfect problem to solve with an online marketplace (platform + network effects).
I’m considering an investment in a company that makes surgical robots for spinal procedures. Spinal surgery seems much better suited for the machines. Plus, consumers don’t pay for surgeries, insurers do. Even when out of pocket expenses are huge, you will take out a loan or do what’s necessary if you need serious spine surgery.
Apple is working hard to turn the iPhone into digital health tracking powerhouse.
If you’re at all interested in this space, here’s an awesome newsletter I subscribe to to stay abreast of what’s happening.

Philosophy

I’ve been doing some thinking about free will of late. The question I’m mulling over is “does it really exist?”
On the surface, we all have free will. You can decide where to go for dinner, what clothes to wear to work, and whether or not you treat people with kindness.
But if you think about the concept of free will on a deeper level, even with respect to those simple examples I just provided, things start to fall apart.
Let’s take the “where to eat dinner” example. First, you get hungry, which is simply a physiological and biological reaction to a lack of energy and nutrients. Chemical signals in your brain drive you to eat. The types of food that you like are a product of cultural and social pressures from the environment in which you inhabit. The time at which you eat is based on a schedule that has been arbitrarily defined to meet the needs of humans where ever you live.
You can see how this plays out when you start to peel back the layers for any “decision” you make.
While this line of thinking may seem like a glass-half-empty type of exercise or philosophical circle jerk, there’s also a bright side. When people treat you poorly or things don’t work out, I think it may be easier to deal with if you understand that no one really had a choice to do anything differently. That guy that was rude to you this morning probably had coffee spilled in his lap on the subway. The homeless woman blocking the entrance to your building didn’t choose to be homeless. She’s probably a war veteran who’s seen some really fucked up shit and this country doesn’t do nearly enough to help vets successfully integrate back into civilian life.
No one is out to get you. Life is just one huge chain of cause and effect that doesn’t start or end with you. You’re just one random link in the chain. No reason to be upset about it.

My Latest Discovery

Sometimes I have a little trouble sleeping. Lucky for me, my fiance is super creative with natural solutions to this problem. Two of her ideas that have been a god send have been:
1) Apple cider vinegar tea. It’s simple, delicious, and effective. Just hot water, a tiny bit of raw unfiltered honey (this helps with seasonal allergies as well), and a couple table spoons of apple cider vinegar. It works wonders!
2) Avalon Organics Nourishing Lavender Shampoo. People often use lavender shampoos for babies, but it seems to work well for big people too.

Uncategorized

[VIC 85] Business trips. International diplomacy. Walking a tight rope. Shake to undo.

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Business & Money

I recently went on a business trip to visit a client and discuss ways to expand the relationship.
On the business side, it was about 5 hours in total of meetings wherein we accomplished a lot.
On the relationship side, we enjoyed a boat cruise and a night on the town. It was a blast.
It goes without saying, but I’ll say it here anyways. Business is a truly human affair. The human element involves the psychologies of incredibly diverse individuals, all with wide ranging goals (personal & professional), emotional states, and idiosyncratic personalities. What people are willing to share when you’re sitting across from them is vastly different than what they’re willing to share on a conference call. What you learn about some one after having a few drinks or during an Uber ride, is vastly different than what you learn from their LinkedIn profile or their latest blog post.
If you really want to build an enduring partnership (as supposed to a vendor-client relationship) that adds real value for both sides, you have to spend time with people getting to know them.

Human Progress

I’m worried about the progress of international diplomacy. As a (perhaps THE) global superpower, we’re used to making calculated and strategic decisions on how we interact with other nations. Regardless of your political persuasion, I believe it’s fair to say that we’ve always had generally competent people in the oval office, surrounded by other generally smart and competent people in other top positions. And generally, decisions have been made by consulting the top people in their relevant domain (e.g. generals for defense related issues, the fed for financial issues, etc).
All of this is in contrast to where we sit today. The guy in the top spot has an itchy Twitter finger and consultants no one before saying he’ll rain “fire and fury” on another country. Are you kidding me? The entire point of democracy and the apparatus of government is to make decisions by committee and force lots of smart people to collaborate with our collective benefit as their chief aim.

Philosophy

What happens at the intersection of logic/reason and emotion?
Too much emotion, and logic/reason never has a chance.
But too much logic/reason, you’re emotionally blind to other people’s perspectives.
Basically, you’re left walking a tight rope with incredibly powerful and unrelenting crosswinds.
I tend to err on the side of logic/reason, but as you’d imagine, I’m tipping to one side. I need to work on my balance.

My Latest Discovery

Ok, this is an older discovery, but it truly changed my life. Did you know that you can shake your iPhone to undo/redo typing? Like literally shake it. Game changer.