Patrick McKenzie Profile picture
Feb 4 6 tweets 1 min read
I thank my lucky stars for the superpower which is “A single email address which files a bug with… anyone.”

It takes some real work on the backend but is incredibly useful for scaled software companies.
The convention in ticketing systems to push all the classification work to reporters is a) hostile to getting good bug reports and b) probably suboptimal because reporters will never understand owning engineering team as well as local part of the org does.
So you should just optimize for getting a high volume of good reports and have a process to triage and classify, which can be done in your ticketing system of choice.
As a user of this system, this lets me take a report of an infelicity in anything Stripe does at literally any time anywhere and just fire-and-forget (or let reporting external user know once it is fixed).
Most recently: “Hey we can set this via the Dashboard UI but not via the API. What gives?”

*forwards email*

And now I don’t have to reacquaint myself with which of four places could have caused that infelicity. It just gets fixed “magically” from user’s perspective.
Again: this is a lot of work on the backend by responsible engineers, and I salute them for it. It is worth it for getting to the desired level of quality and responsiveness.

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More from @patio11

Feb 5
If I were a cynical man, I’d say you could write a cron job to flag clients for which the blockchain offered you an excuse to terminate loan contracts and then *time doing so* when maximally in your interest, harvesting lots of free option value.
“Compliance as a profit center!”
In this case, the borrower had economic exposure similar to being short a OTM put on Bitcoin. That implies that the lender has economic exposure to that decision similar to being long an OTM put on Bitcoin.

That’s a position that has some value.
Read 4 tweets
Feb 4
Applies equally to tech investing, and I think LPs should probably just stop requiring particular numerical targets for GP contribution.

(This norm also has terrible distributional consequences for emerging managers.)
The norm is that you put up, say, 2% of the money in a fund, which is very plausibly more than the net worth of many early career tech professionals if they didn’t come from money.

Historically, most VCs didn’t have a problem with that. However.
As a (tiny) LP, I tell fund managers “Not going to ask and you don’t have to tell me; I know this is your main career focus for next 10+ years. If I didn’t trust you to care about that more than you care about money, we would not be here.”
Read 5 tweets
Feb 1
“We did not pay interest on time” is sometimes considered a consequential issue for financial services providers.
“It will be a day or two late due to computer issues”, posted to one’s status page, is also generally speaking not seen as a complete response.
I’m not sure I even buy the “They can’t pay because of solvency” source of risk; I just think of “Oh you’re going to try continue being a regulated financial entity after this. Um, well, about that.” source of risk.
Read 4 tweets
Feb 1
Here's a really interesting thread about a recent startup financing.
With a VC hat on, there's a big question as to whether investors are paying valuations rationally calculated to some discounted percentage chance of an outlier return, and whether businesses on this model can generate outlier returns to grow into market-comparable valuations.
With a technologist's hat on, this seems like disruptive innovation of the early-stage VC model, where funding happens in a dense network not by serial approaching angels or by getting into the YC/Demo Day pipeline but instead by an ad hoc process akin to GoFundMe or crypto.
Read 8 tweets
Jan 31
I watched a creator describe their journey from underutilized technical civil servant to full-time small entertainment business. Won't link to avoid stigmatization but parts of it reminded me of my own experience back in BCC days.
"The only labor market I have available to me misuses me in pathologically bad ways so my options are either a) emigrate or b) do literally anything else, and I choose the subtype of b where there is a script available to me." sums up our mutual thought process quite a bit.
On the one hand: yay for having more choices in the world.

On the other hand: wonder how much of this is just a reflection of non-borked labor markets having structural reasons why they can't hire in XYZ.

(Said creator in Germany, me in Japan, etc etc.)
Read 10 tweets
Jan 30
. @ByrneHobart had this in his newsletter, the last sentence of which is very relevant to the relative size of Tether’s claimed reserves and the commercial paper market.
I’d phrase it as this: “Ponzi schemes have an unbridled urge to expand, and eventually the expansion of the fake books is so large that it should produce a visible change outside those books, but does not. This fact is often noticed casually by someone uninterested in scheme.”
Even the smallest businesses create ripples in the outside world, and are very detectable if one knows what to look for, but Ponzi schemes describe themselves as roiling tsunami generators than fail to measure up to that.

(Satoshi schemes also have this property.)
Read 5 tweets

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