Patrick McKenzie Profile picture
Aug 8, 2019 3 tweets 1 min read Read on X
Advice which seems obvious to me now but which wasn't and so maybe will help you:

If you ever are talking to someone who is very good at some X relevant to you, and you hit it off, ask them "Who else should I talk to about X?"
They are very, very likely to talk to other people who are good at X (or otherwise professionally involved with the sorts of problems of people who talk to people working on X), likely have a better calibration than you do on who is good at them, and *will often love to be asked*
(In Silicon Valley there is a subtle culture about the difference between "Who should I talk to about X?" and "Who would you introduce me to talk to about X?" Part of me understands; part of me believes that where the difference is material just resample the conversational pool.)

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More from @patio11

Mar 27
This week on Complex Systems, a continued discussion of credit card rewards, interchange, and what I believe is a persistent misconception about how society should want justice done via payments systems.

It ends with the following, which the team took the liberty of putting into a short clip. (Sound on if you like hearing my voice, but video is subtitled.)
Last week the Atlantic published an opinion piece which argues that the poor are subsidizing the rich's receipt of credit card rewards. This view has wide currency among certain advocates and among opinion writers.

It is not true.
Credit card rewards are actually funded by interchange, a cost which is ultimately paid by card-accepting businesses for a combination of services they get from the payments industry.

Rewards have a few equilibria globally; the U.S. is in a high rewards, high interchange one.
Read 10 tweets
Mar 20
An argument I have had with some credit card enthusiasts for a very long time, paraphrased.

Enthusiasts: I’m robbing the bank blind!
Me: Doubtful? They are probably pretty happy to have a portfolio of you.
E: Oh by carefully layering promotions and making a spreadsheet and…
Me: So checking my understanding: you spend a lot of money on credit cards.
E: Yes, that’s the whole point.
Me: And in a nation which makes it illegal to underwrite using an IQ test, you have self-constructed an IQ test.
E: Yes and I pass it obviously.
Me: Right. Tracking.
Me: You sound like a very desirable bank customer.
E: Oh no I’m not! I take them so hard.
Me: Your income and net worth are likely to be quite higher in ten years right. You predict that too?
E: Oh yeah.
Me: Yeah you’re going to continue consuming lots of financial services.
Read 7 tweets
Mar 20
The Atlantic has an interesting piece on credit card processing. The thesis is that interchange fees redistribute money from poor to rich.

I do not subscribe to this thesis.

For a quick recap on how credit cards make money, see Bits about Money's issue on the topic.

bitsaboutmoney.com/archive/how-cr…
There is a general feeling in some quarters that the payments industry functions as a tax on everyone, and that the incidence of this tax must be highest on the poor, because they're least likely to have a rewards card.
Read 36 tweets
Mar 18
Last up at #microconf, Marcos Rivera from Pricing I/O on pricing.

"How to avoid stupid mistakes in SaaS pricing"

(I am likely to have some thoughts.)
As always, quotes are Marcos (lightly paraphrased; real time is hard), anything attributed to Marcos is a heavy paraphrase, anything unattributed is me.
Marcos was previously Head of Pricing for Vista Equity Partners (hoohah; noted PE firm in software space).

Podcast host of Street Pricing, too.
Read 33 tweets
Mar 10
This is a useful enough specific observation that I'm promoting the general observation to text:

Organizations don't make decisions. People at organizations make decisions. Very often, there is one lynchpin person who must hypercommit to an org doing something for that to be.
From this follows any number of corollaries, including:

1) If you desire change in an org, it is really useful to understand who, specifically, is the lynchpin for the change you want to see.
2) You might be offered the choice to be that person at some point in your career.

This will rarely follow someone whose job title is Quest Giver coming to you with a choice of two pills, one of which is failure and one of which is success, with clearly listed of side effects.
Read 5 tweets
Mar 8
One of the cultural quirks of capitalists is that there are many lies that one is allowed or even encouraged to tell in society, and capitalists are members of society, but are in principle not allowed to lie about revenue.

This strikes many non-capitalists as odd.
I have jokingly phrased this as “Certain forms of writing are sacred. For example, if you write the word Balance Sheet on top of a list of numbers, those numbers become sacred to capitalists, and a lie amongst them is a sin that the gods of capitalism will punish most severely.”
But this causes a cultural disconnect because society broadly allows many fudgings of numbers. And e.g. conversations between management and investors allow for certain forms of salesmanship.

But about revenue: not allowed. We are pretty serious on that.
Read 6 tweets

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