A children's book explanation of what's happening:
1. If you are "smart money" you are allowed to take your $1 and leverage it up to $15+
2. You can now buy $15 of stock AND if you promise to short companies, you can short $15 of stock as well
3. In finance language, this means that you are $30 "gross" ($15 of longs + $15 of shorts) but $0 net (+$15 of longs -$15 of shorts). This makes everyone feel good because it feels like you are taking zero risk...but in reality, your $1 is exposed to $30 of risk.
4. Now you go around and tell your friends about both your longs and your shorts and when you do it at a restaurant vs on Reddit, its called an "ideas dinner".
5. You also publish your longs on a quarterly lag via an SEC rule. You don't have to tell anyone about your shorts.
Over the last year a few things have become clear: the world is more uncertain than ever, and the situation for small businesses is more perilous than ever.
Technology and capital can play a role in solving this problem.
It may sound boring to some but Insurance is a key enabler of economic growth and backstops trillions of dollars of economic activity.
As many business owners found out, significant gaps exist in coverage for the business interruptions that are becoming more and more frequent.
@davidsoloff and I are building @ottrisk to combine machine learning with traditional risk underwriting to make a meaningful start in filling the business interruption coverage gaps which are upending economic lives.
Here's the story of how I came to own a piece of the @warriors.
In 2011, I was 34 and had left $FB to start @socialcapital. When I was raising my first fund, I spoke to @peterthiel about investing. He asked me how much I planned to invest as the founder and only keyman.
- 1,000 total proposals submitted
- 156 were rated "Excellent" and were surveyed
- 29% were collaborative efforts
- 86% male / 14% female
- 38% non US (45% non US citizens)
- 24 countries represented
- 51% work in the private sector
Passion about climate change and recognition that this is one of the biggest challenges of our time was the driver for almost all applicants.
More than half of applicants were also interested in working with us on setting up this NewCo.
β’1,392 applications
β’96.2% Male
β’40% Non-US
β¦76 countries represented!
β’56% non-white or multiracial
β’44% of applications are currently full time or professional investors
The opportunity to join a community of investors was the primary driver for most applicants, even beyond the opportunity to manage capital (although this may be skewed by the high number of people already managing capital).