Notes from reading in Spring 2020
- Going from 0 to 1 is not improvement but creation.
- Perfect competition is bad—it leads to commodification of a business. Commodities mean no personality and no competitiveness on anything of merit, only existence. The aim is to be so revolutionary by default that the result is monopolistic.
- Network effects preclude the creation of other monopolies because, by definition, they form one solitary cohesive network.
- Anti-Anna Karenina principle: All happy companies are different because they address unique problems in unique ways, while failed companies tend to fail for the same reasons.
- The rat race of students involves ascending a ladder of status games. Higher education traps people with big plans in high school into rivalry with other former dreamers, all chasing conventional top-tier optionality careers.
- Unambiguous top-tier rewards mean no real risk or value was created since the endgame was predetermined for everyone to chase.
- “All Rhodes Scholars had a great future in their past.”
- In this setting, being less sensitive to social cues is better because it allows you to think for yourself and stay focused on your path of interests (passion). This focus enables you to become world-class, as opposed to being one of millions with surface-level competency.
- Focus on aspects of the world you can control because so much is out of your hands.
- “Shallow men believe in luck and circumstance; strong men believe in cause and effect.” (Ralph Waldo Emerson)
- Luck is for those prepared for it (e.g., Roald Amundsen, the South Pole explorer). Why read anything on self-improvement or skill development if you’re focused on chance? You’d be better off studying lotteries.
- It’s not in your control, so why despair?
- Have a definite attitude about the future—focus on conviction and clarity, not process over substance or “many-sided mediocrity.”
- We can control our future—or at least fail heroically while trying our best.
- Diversified portfolios make sense at a macroeconomic level. But for investors, is it really a good approach? No.
- You want to have specific criteria and allot significant capital to a few opportunities.
- The power law applies: you cannot diversify your time and still maintain top-tier results.
- Can you diversify your life by hedging across many careers (e.g., staying in consulting forever)? If so, what value did you create?
- Power laws actually matter, not the “equal time” fallacy we’re raised with (e.g., 45 minutes in history class when you know you want to do math).
- Sales is a skill—a very hard one with a “grandmaster” level few people ever achieve.
- Distribution = sales. (Investment banking is selling companies; business development is selling customers and markets.)
- At the highest level, sales is hidden but essential.
- Breakthrough tech questions (0 to 1 versus incremental improvements):
- Monopoly: What share of the market can you capture?
- Timing: Is now the right time?
- People: Who is your team?
- Distribution: How will you not just create but deliver your product?
- Durability: Is your solution defensible in 5, 10, or 20 years?
- Social entrepreneurship as a standalone concept is a myth. It removes the premise of competitive business, making such initiatives weak players in the economy.
- Questions arise: What is social good? Who defines it? Who does it serve?
- It’s easier to actually do good for society than to prove or say you did.
- Social entrepreneurship focuses on signaling or doing the latter, so incentives are misaligned.
- Example of failure: Cleantech isn’t truly viable yet.
- Ayn Rand’s villains (politics, societal pressure, communalization) are real, but her heroes are not.
- You can embody aspects of heroism, but there’s no room for self-delusion or self-heroism.
- Don’t believe your own BS—let it work for you as long as it doesn’t harm others.