1/ Thread: You and Your Research

In 1986, Richard Hamming, a famous mathematician, gave a speech titled “You and Your Research”.

@RishiGosalia insisted I read the speech, so I did. It is one of the few things I would like to re-read many times in future.

Leaving some notes.
2/ “shouldn't you say to yourself,, “Yes, I would like to do something significant”

Success is not a mere byproduct of luck although it does play a role. Many successful scientists had many great work, not just one-off work. Think Einstein, Shannon etc.
3/ Newton said, ``If others would think as hard as I did, then they would get similar results.''

“Once you get your courage up and believe that you can do important problems, then you can. If you think you can't, almost surely you are not going to.”
4/ "When you are famous it is hard to work on small problems. The great scientists often make this error... They fail to continue to plant the little acorns from which the mighty oak trees grow."
5/ ``Knowledge and productivity are like compound interest.''

"The more you know, the more you learn; the more you learn, the more you can do; the more you can do, the more the opportunity - it is very much like compound interest."
6/ "Most people like to believe something is or is not true. Great scientists tolerate ambiguity very well. They believe the theory enough to go ahead; they doubt it enough to notice the errors and faults so they can step forward and create the new replacement theory...
7/ ...If you believe too much you'll never notice the flaws; if you doubt too much you won't get started. It requires a lovely balance."

A beautiful example of this was Charles Darwin.
8/ “If you do not work on an important problem, it's unlikely you'll do important work. It's perfectly obvious. Great scientists have thought through, in a careful way, a number of important problems in their field, and they keep an eye on wondering how to attack them”
9/ “The average scientist, so far as I can make out, spends almost all his time working on problems which he believes will not be important and he also doesn't believe that they will lead to important problems.”
10/ "I finally adopted what I called ``Great Thoughts Time.'' When I went to lunch Friday noon, I would only discuss great thoughts after that. By great thoughts I mean ones like: ``What will be the role of computers in all of AT&T?'', ``How will computers change science?''
11/ "The great scientists, when an opportunity opens up, get after it and they pursue it. They drop all other things and they get after an idea because they had already thought the thing through. Their minds are prepared; they see the opportunity and they go after it
12/ “How do I obey Newton's rule? He said, ``If I have seen further than others, it is because I've stood on the shoulders of giants.'' These days we stand on each other's feet!”
13/ “I have now come down to a topic which is very distasteful; it is not sufficient to do a job, you have to sell it. `Selling' to a scientist is an awkward thing to do. It's very ugly; you shouldn't have to do it.”
14/ “You have to learn to write clearly and well so that people will read it, you must learn to give reasonably formal talks, and you also must learn to give informal talks.”
15/ “it is very definitely worth the struggle to try and do first-class work because the truth is, the value is in the struggle more than it is in the result. The struggle to make something of yourself seems to be worthwhile in itself. The success and fame are sort of dividends”
16/ Why do so many of the people who have great promise, fail?
17/ How to convert a fault to an asset
18/ “why so many people who have greatness within their grasp don't succeed are: they don't work on important problems, they don't become emotionally involved, they don't try and change what is difficult to some other situation which is easily done but is still important..."
End/ Although it was directed to fellow scientists, a lot of parallels exists for analysts, investors, and entrepreneurs! I recommend you read the whole speech in a quiet afternoon.

Link to the full speech: cs.virginia.edu/~robins/YouAnd…

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More from @borrowed_ideas

11 Jul
1/ Thread: The value of a newsletter

For a long time, I thought the value proposition of a newsletter is great. Only recently I have understood my framework for assigning value to a newsletter was perhaps flawed.
2/ My initial framework was based on my own opportunity cost. I thought since the opportunity cost is $200-300k but I am willing to sell my intellectual capital for $100/year, that must be a great deal for subscribers.
3/ That thesis isn’t entirely wrong at first glance since I did end up getting 1k subscribers in less than a year. But this thesis is very much “author-centric” view.

A more “subscriber-centric” view is likely to reveal the value proposition (or lack thereof) better.
Read 12 tweets
28 Jun
1/8 quick thoughts on $ETSY's acquisition of Elo7

Etsy just announced acquisition of Elo7, marketplace for handmade items based in Brazil, for $217 mn cash.

Elo7, founded in '08, is also known as Etsy of Brazil and was backed by Accel ('11), Insight Venture Partners ('12).
2/8 56k active sellers, 1.9 mn active buyers.

My first impression is liquidity of the marketplace is still not quite there yet.

Etsy didn't disclose GMV/revenue of Elo7. Quick google search shows $4 mn revenue (not sure of veracity). Assuming $50 mn GMV, Etsy paid >4x GMS.
3/8 As per an IFC study, 85% buyers and 80% sellers are women on Elo7.

Interestingly, ~75% of the women in the IFC study responded they became seller on Elo7 after becoming a mother.
Read 10 tweets
25 Jun
1/ Thread: The impact of intangibles on base rates

@mjmauboussin and Dan Callahan published a new piece couple of days ago. As an ardent student of Mauboussin's work, I am leaving my notes here.
2/ There are two ways to forecast the future.

a) The Inside View: You study the company of interest, understand the economics, and project operating metrics based on the narrative.

b) The Outside View: You think statistically, find reference class of the company of interest...
3/ ... and evaluate what happened to that reference class. You get your base rates from the reference class which influences your forecasted numbers.
Read 12 tweets
20 Jun
1/9 Thread: No Slam Dunk in Investing

I was recently speaking with someone and we both somewhat lamented how Buffett did not bet big on Google.

Google IPOed in 2004; it may not be clear then that they would win search. But surely by 2014, Buffett should have known it, right?
2/9 Following our conversation, we both explored a bit whether it really was that obvious that Google was an easy buy in 2014 when it was trading at ~$500.

Let me share two quotes.
3/9 "The growth rate in Internet penetration is set to peak in 2016. Were Google’s revenue and profit continues to track Internet penetration, then those metrics would peak as well"
Read 9 tweets
9 Jun
1/5 Thread: Income inequality gimmick

ProPublica's "leak" on wealthy individuals' taxes reminded me of some of the studies related income inequality I read a few years ago.

A short thread.
2/5 University of Michigan did a study from 1975 to 1991 following a group of individuals who initially started in the bottom 20%.

95% of these people were found not to be in the bottom 20% in 1991. 29% actually reached the top 20%.

Link: (page 8) scribd.com/document/88651…
3/5 IRS later did a similar study from 1996 to 2005, and found people who started in the bottom 20% in 1996 saw their income increase by 91% over the decade and people who started at the top 1% actually saw their income fall by 26%.
Read 5 tweets
2 Jun
1/ Thread on @depop acquisition by $ETSY

Etsy just announced to acquire Depop, a gen Z focused online apparel resale marketplace for $1.625 Bn (all cash). Optically expensive i.e. ~2.5x GMS or ~23x revenue based on 2020 numbers.

Here are my thoughts.
2/ Etsy coined an interesting term today “house of brands”.

After Reverb acquisition in '19 and now Depop, the strategy seems clear: keep penetrating vintage, handmade core marketplace AND acquire other niche marketplaces that you will have hard time building a connection with.
3/ Why is this important?

E-commerce is primarily behavioral in nature. Once you buy something from a marketplace, they have enough of your data to encourage you to buy again.
Once a marketplace grabs critical attention in a niche, it can be difficult to unseat the incumbent
Read 16 tweets

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