"'Stay close to the money.' If you're not close to the stream of cash flow, if you're not directly responsible for winning the bread, and bringing in cash, you're expendable... Cash flow is a lifeblood."
"Time is the most important thing our brain uses to perceive causality. Anything more than 2 seconds has been shown to inhibit our ability to see a cause and effect relationship - unless a reason is given."
"And in most businesses... people end up being the most important thing you've got. Remember that more often than not you're betting not on a business, but on a person that will build, evolve and adapt a business"
"the two most important things that kids (especially inner-city kids) require for a successful education are (1) picking the right heroes and (2) developing a deep desire to learn"
"Today, we still need liquid fuels to power our cars - but soon enough we'll have electric fleets and the most important question won't be the price of oil but the price of electricity to run our cars"
"A phenomenal individual is... a spinning force that pulls people in. The most important thing we can do as a firm is have the good judgment in finding and picking these people and convincing them that Lux is their partner for the next 5 or 10 years"
"'Edge' is the most important thing any competitor in any arena must possess... Overt or covert, widely signaled or held as trade secret, it is a competitive advantage that makes playing unfair"
"Yahoo founder Jerry Yang told me he thought the market had jumped the shark... with Snapchat, Oculus, and WhatsApp. But he said the most important thing I heard: he capitulated. Now, he said, he thought it could go on for two more years and maybe more"
"the two most important questions [were/are]... Number one: Why should you exist?... Number two: If your hypothesis is right that these are the next waves, what is going to stop Kleiner, Sequoia, Benchmark, Accel from blowing you out of the water?"
"I think the most important thing in business... I am psychotic about competitive advantage. What can you do, or what can you assert that you can do that will scare competitors that nobody else can do? From that flows good unit economics"
"The most important conversation, the most memorable, was when we went to Bill... all these crazy areas of emergent tech, and I said, 'I want to put our money where our mouth is now in this space, actually I want to put your money where our mouth is'"
"Survive is number one... To me, it is the most important thing in life. Some people don't want to have kids, and some, but I just, to me it's everything."
"today, the technology, and this is actually a really crazy thing. There are tools, like something called generative design. This to me is one of the most important areas of technology that I want my kids to understand"
On the most important things that people don't know about him: "I love heavy metal and hardcore. I grew up going to a mosh pit in Brooklyn... And I like skateboarding and I like people that just have this sort of gritty rebel side"
"I think the single most important thing for anybody is to build your brand, be differentiated, be indispensable, stay close to the money, find where the capital is flowing and stay close to it"
1/ On April 3, 2024, Sapient Capital's Tom Morgan gave a presentation at the Sohn Conference titled "The Most Offensively Taboo Idea in Western Civilization" where he distilled 10 years of curiosity research into a 5 minute talk.
I found this presentation to be one of the tightest, information-dense, and thought provoking talks I've listened to. I wanted to be able to refer back to it easily, so I transcribed the talk and screengrabbed the slides.
I shared the transcript in A Letter a Day (link in bio), but people enjoyed when I shared my transcript of Bill Gurley's "2,851 Miles" presentation on X, so I thought I would share this one here too.
⬇️ Full Transcript with Slides below ⬇️
2/ So I'm not going to talk about a stock today. Instead, I'm going to talk about the most offensively taboo idea in western civilization.
3/ This is Dr. Ian McGilchrist. He wrote, probably the most interesting book I've ever read, The Matter with Things. His focus of his very long career has been the two hemispheres of the brain. Now, you're probably thinking this brain hemispheres stuff has been debunked. It hasn't. It's just nuanced.
1/ On Sept 12, 2023, Benchmark’s Bill Gurley gave a presentation at the All-In Summit titled “2,851 Miles” where he discussed the past, present, and future of regulatory capture in Silicon Valley.
He received a standing ovation and his presentation was dubbed “an instant classic.”
Former PayPal COO David Sacks immediately called it “the best talk in the history of All-In” and said “we need to get it out there immediately so it can start going viral. And I think it will go very viral.”
First Round’s Chris Fralic thought it was “So good. A Perfect TEDTalk” and “it’s gold.”
Shopify Founder and CEO Tobi Lutke commented that everyone should “definitely watch [Bill’s] incredible talk… once it comes out.”
One audience member liked it so much he yelled at Bill to run for President as the applause died down.
I found the talk full of interesting anecdotes and wanted to be able to refer back to it easily, so I transcribed the talk and screengrabbed the slides.
Thought I might try something new and share it here.
⬇️ Full Transcript with Slides below ⬇️
2/ I'm Bill Gurley. I got to Silicon Valley in about 1997. And was fortunate enough to become a venture capitalist in 98. And the entire first year of my career, I had zero interest in interacting with any form of government. It didn't seem necessary for what I was trying to do. I was working with founders and software and technology. I didn't see what it would bring me.
3/ Until one day where I ran into an issue, which I'll tell you about later, that required me to understand what was going on in Washington. So I checked in with a few advisors, they introduced me to this lawyer in DC. Turns out, DC lawyers do a lot of things that aren't lawyering. And he listened to what I had [to say], he said, I'll call you back. He calls me back. He says, Bill, I got exactly what you need. I found a congressman on the committee that matters to what you're talking about. And I can set up a meeting. I go Great, I'll fly out. He goes, No, no, no, don't fly out. He's coming to you. He's coming to me? That's pretty nice. He goes, Do you have a conference room? I said, I'm a venture capitalist. We have lots of conference rooms. So he said, I need you to get some people together. And here's the catch. They need to bring $5,000 each.
1/ With a flurry of successful U.S. tech firms absent from China, would you have been above being the one to bring them there?
Wang Xing wasn’t – creating businesses “inspired” by not just Groupon, but Facebook and Twitter too, coming to epitomize the term "Chinese copy-cat".
2/ His clones were so precise that you almost sensed pride when he added “a Mark Zuckerberg Creation” at the bottom of his Facebook clone.
But ironically, it’s actually for his innovative prowess and creating something the world has never seen before, that we know him.
3/ In 2010, after middling success with his other clones, Wang Xing set out to copy Groupon, but what resulted was one of the world’s most innovative apps.
1/ Coupang $CPNG reported 4Q21 and the market seems to be a bit disappointed (-2.5%) as they had a small miss.
But we think the market is focusing on the wrong things. An overview of earnings and their new disclosures below.
2/ Topline slightly missed at $5.1bn vs cons at $5.2bn. This represents +34% y/y growth and a 1,400bps deceleration from last Q’s +48% y/y. However, in constant currency they grew +39% y/y in 4Q vs 44% last Q.
2a/ Adjusting for currency fluctuations shows their growth deceleration isn’t so stark, but at their size they will continue to slow.
2/ 3Q21 revenues were +10% y/y, which is a 1900bp sequential deceleration from 2Q, and missed consensus by ~1.5%. Adj. EBITDA of RMB 51.3bn missed consensus by ~0.5% and is down ~25% y/y.
There are many pieces to this and we will start to unroll it with their China Commerce.
3/ To the positive, in China BABA added 20mn new users to reach 882mn and they noted on the call that annual active customers (AACs) who spend >10,000 RMB on the platform increased y/y.
1/ What could you do with 4 square meters of retail space?
Try creating over $100 billion dollars of market value with one of the worlds largest retailers.
The path would not be easy though, and at times you would have to risk it all.
2/ With just a 4 sqm stall in an offbeat Chinese market, after 5 grueling years of battling against purveyors of cheap, faked goods, Richard Liu was able to build a chain of 12 electronics stores.
3/ His niche?
a) Never sell inauthentic goods and provide receipts to signal legitimacy.
b) Put price labels on everything so customers know they are getting the same prices as everyone else vs other sellers who endlessly haggled with customers to get their last penny.