This Week I Learned #19
““Go to bed smarter than when you woke up””
2018-10-08
Wealthy: Josh Elman on podcast interview with Jason Calacanis. His presentation on product is great. They discuss the importance of focusing on the metrics that matter. The most important one being "how many people are actually using your product". It's the bottom-up approach of first understanding the intended use case for the product and how to think about tracking true customer captivity. Like Airbnb would fail if they tracked daily, weekly or even monthly use because most people don't travel every month. People that travel every month are probably business folks who would probably get a hotel since they don't need to save costs and/or aren't focused on "experiencing culture". Whereas for Uber it could be a daily or weekly tracker. For blogs it could be engagement from the subscriber base of how often they open newsletters. The higher level message of the video is to actually "think". Everyone is obsessed over MRR, CAC, LTV blah blah blah but the true competitive advantage of a product lies in its customer captivity and how will you measure it? Because that is the metric you would be investing your dollars to improve upon. The link is a video presentation. https://thisweekinstartups.com/osh-elman-greylock-rob-may-talla/
2018-10-09
Wise: Currently reading the Icarus Deception by Seth Godin and I hit upon a few passages that hit me. 1) "Failure is an event, not a person." There is just so much with this quote. The first addresses the internal narcissism so many people have in calling themselves a failure. On the first level it may seem like a humble thing but on the second level it's an internal acknowledgment that the individual is so special to even have a "failing" to be considered worthy to be announced and attributed to oneself. No one cares. With the dissection of failure being pulled out as an event it pulls that narcissism away. On a positive note it de-personalizes it. I've always believed every event has 2 outcomes. You've either succeeded or learned. By categorizing failure as an event it makes that an easy mindset shift to make. 2) "The Youtube video maker gets more out of making a video than you get out of watching it." It's true! The creator of a product, whether it be an iphone, software or even an excel dashboard, will have gained much more from the process than the end user. The spectator can only feel a minute portion of what truly happened. With such limited time, limit the time dedicated to being a spectator.
2018-10-10
Wise: My attention was drawn to Masayoshi Son's 100bn Vision Fund today by my good friend Eric. Interesting fact, Masayoshi Son is Korean and he changed his first name to a Japanese one. I'd passed over any previous news of this fund as indications of the "frothiness" of the venture capital space. $100bn is a huge fund. It's also a lot of capital to think about deploying for any kind of private company. I mean, my previous fund was $45bn and we'd have difficulty investing in great small-cap companies so any form of seed or Series A investing will be close to impossible for the Vision Fund. This is all assuming they are looking to generate outsized returns. Jason Calacanis' perspective on the Vision Fund gave me a new perspective. The Vision Fund is not an early-stage fund, it isn't even really a venture capital fund. It's the IPO fund for private venture-backed companies. One of it's key raison d-etre is to provide soverign wealthfunds (mainly the Saudi government) exposure and ownership to global tech companies to diversify the country's industrial mixture. So they aren't about taking big risks but buying close to sure things just before they hit the stock market. The fund also provides liquidity to many VCs as well, since unrealized gains is worth $0 and funds are handcuffed to return money to investors. With less companies wishing to go public the VIsion Fund provides another layer for liquidity to private company investors. https://thisweekinstartups.com/e829-all-askjason/
2018-10-11
Wealthy: Learning about SEO for content marketing for my blog from a conversation with a technical entrepreneur. Utilizes SEOs as a cost free way of content marketing and it allows you to just set it up and let Google crawl over your site. The key is to make the content specific and niche enough to be found in the search. Also, Google will put a higher "preference" to trusted sources like Yelp of a forum like Indie Hackers so posting content there and having a shareable link is more effective for the content. A great tool for this is going onto Google Search Console to obtain analytics on the site.
2018-10-12
Wise: A fun investment piece showcasing various examples of company strategies for creating competitive advantages. Learned about Gillette's razor blade business model where they would practically make profits on the razor blades rather than the razor itself. Once consumers had the razor they would continuously come back for the blades that fit that razor and that became the captivity factor that Gillette capitalized on. The blade is a much smaller component of the total cost buying a razor + blade but has the recurring aspect where Gillette could slowly increase prices to increase revenue over time. However, they got to the point of having increased prices too much and that resulted in cheap alternatives like Dollar Shave Club to enter. THe jury is still out on whether P&G can turn this around now. A similar model to Rolls Royce and their airplane engines. There is a different business model of a Japanese home appliance company that has a dominant market share and competitive position in the country but they won't increase prices. They serve the stakeholder (that includes shareholders and customers) and raising prices on them is not a strategy the company is willing to pursue. This limits the entrant of new competitors and helps grow the company's advantage. This is like the "shared economics of scale" that Nick Sleep talks about. Those were a few examples I enjoyed reading about. Now, where I disagree with the author on is the idea of "protecting the moat". I think business strategy is all offense. Your moat is a dynamic thing that will either expand or shrink constantly with competition. Spending money to defend a moat is a strategy to have it shrink over time. A company must expand it all the time. https://www.burgundyasset.com/wp-content/uploads/Marshmallows-and-the-Cost-of-a-Moat-WEB.pdf
2018-10-13
Wise: "Action expresses priorities" - Mahatma Ghandi
2018-10-14
Wise: Just listening to an interview with Tobias of Semplice on Indie Hackers and today's learning is a continued reinforcement of an idea. I was reinforced with this idea this morning whilst reading Antifragility by Nassim Taleb so double reinforcement in a day. Its the idea of how those who call your idea stupid, the anti-fans, the ones who just passionately think your idea sucks are your greatest assets. Because they will create a train of negative press but that passion they have will bring in the interest of others. Its like if you want someone to read a book, telling them how much you passionately hate one book is a greater reason for people to read it than you saying its a great book. When I tell people how I don't consider “The art of not giving a fuck" worth reading it gets a huge response from peers. Compared to me saying how much I love reading another book. Its also especially powerful if someone passionately is against your idea when the majority are lukewarm to okay with it. So far i haven't had any passionately negative press on my essays, podcast nor my mission of turning OMD Ventures into a media and investment company. Guess its just not crazy stupid enough. It just means i have more room to try to press the agenda further. https://www.indiehackers.com/podcast/035-tobias-van-schneider-of-semplice
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