Business models are changing.
Success doesn't really depend on an ecosystem or platform. It depends on access to the best customers. At an extremely simplistic level we can think of the best customers are those who are most willing to pay for what you're selling. That definition is broad in that it can encompass any market and the customers within markets are not disjoint. The companies that own access to those customers are the companies that are going to generate the profits. It is them who have the power to direct those customers to the products. They can influence, they can drive desire. This post's idea of success is that a company captures a certain type of customer, knows a lot about that customer and therefore is able to profit by directing them to the most efficient seller.
The modern way to get those users is to first deliver superior user experience. Capture the superfan - others will follow. To capture those fans, you have to have a superior product. Marketing can't make a mediocre product good. It can make is sell a few in the beginning, but it can't create a superstar. Simple as that.
What about the best businesses? It is no secret I am a fan of Aswath Damoaran. The Industry Average Excess Returns data he provides with the post (Investing in Bad Businesses)[http://aswathdamodaran.blogspot.com/2015/05/no-light-at-end-of-tunnel-investing-in.html] is fun to look at. Download it and sort descending by the Average Excess Returns 2005-2015 column. While it is fun to dream of owning a company that consistently achieves double-digit returns and laugh at anyone who works at the bottom, I think the sectors in the middle are those who have the most interesting problems and who will probably be more willing to work on solutions.
This post is falling off the rails:
investing - the only thing that matters is you paid less than you sell it for. one way to do this is to find things that have a higher value than what they're selling for. one way to do this is by simply excluding the losers.
exclude the losers, hold on to the average or better. you make money by avoiding the losses.
primacy of risk control
do not time the market. trying is futile.
what the wise man does in the beginning, the fool does in the end, first the innovator, then the imitator, then the idiot
Yep, the post is a complete wreck. must re-write.
YOU SHOULD DO THIS BECAUSE NOBODY ELSE IS DOING THIS AND IT IS A GOOD THING BECAUSE OF REASONS A B C and D. explain the merits, tell the story clearly, concisely and convincingly, you'll get the clients.
Self assessment is important.
There has been a lot of talk about unicorns lately, or, at least, I'm getting a nice Baader-Meinhof phenomenon for unicorns. At any rate, I think Aswath nicely illustrates some fuckery that can be done in valuation during an up round. It is nicely explained here:
And then there is this analysis of biotech unicorns and the idea that maybe it is better to invest in a basket rather than one:
In that article there is a link to a slideshare that, in fact comes from a bennedict evans post. You might as well check that out, too:
I knew the day would come when someone would say, "Tricky Keg Stands? Really?" I didn't have a plan for what I'd do next, though. It has been nearly a year and I still do not. On one hand, I want to keep trickykegstands and just own it. On the other hand, it feels like it is time for something new. I am definitely overthinking it, but that's what I do. Also, there are so many domain names available I can't decide on something new. Let's start with the ones I already own.
I want to do some industrial automation work. If I do, I will name the company Standard Automata, Inc. I bought standardautomata.com and thought, hey, that's kind of a mouthful but it still might make a good name. Then I was going to change my twitter name to standardautomata. Sad trombone... too many letters. The best one I can find is standardautoma... but that sounds like hematoma. stndrdautomata? i don't love it.
So, yeah, I've got nothing. Should I keep trickykegstands?
Per the damodaran finance class i'm listening to, the risk free rate basically boils down to the expected rate of inflation in the currency in which you are working. (This is the sound of lightbulbs going off in my head.) Rule of thumb - Use the 10 year zero coupon rate for the risk free rate if the bond is rated AAA. If it is not rated AAA, then take the published rate and subtract off any default risk. You do this because often you will add in default risk at a different point in your analysis. You do not want to double count.
For me, this is kind of huge. I always thought of the risk free rate as the minimum return you could possibly expect with zero risk of default. Which, sure, that's true, but understanding that the market essentially drives that number to track expected inflation of the currency in which you are investing helps me to better understand the fact that different countries have wildly different risk free rates. I never knew why you wouldn't just shift currencies around to get the best deal.. well, i forgot to think about inflation.
update 20120519 - Heh, in lecture 6 he said that the risk free rate is really inflation + macro market growth. I guess that makes sense, too. Still learning
The difference between html's bold and strong tags and italic and emphasis tags eludes me.
Let's talk about hidden markov models. No, really, someone teach me because I ran out of copy paper this week and wound up using all the papers I printed out that I hoped would help me understand them as printer paper. Dammit.
I love John Steinbeck's letter that is on letters of note today:
"If there is a magic in story writing, and I am convinced that there is, no one has ever been able to reduce it to a recipe that can be passed from one person to another. The formula seems to lie solely in the aching urge of the writer to convey something he feels important to the reader. If the writer has that urge, he may sometimes but by no means always find the way to do it."
I know I'm no writer, but everything on this site and armp.it is from me getting this compulsive need (out of nowhere, typically) to put a certain feeling into words and most of the time it doesn't work. Or, rather, I Get It.
I'm putting together a comment service for the app i'm building. I think my implementation is interesting. Here's how i'm doing it. Everything in my system uses a UUID as its ID or primary key. Everything, including each comment. Each comment stores the UUID of the item to which it is attached, the comment text, timestamp, etc. All comments are shoved into this service so that when something says, "I want to display any comments associated with me." All it has to do is pass its UUID to the service which returns a (JSON) list of comments.
The challenge here is how do you go from Comment to the Item. Well, since I don't store the Item's location we fall back to a searching pattern. Every item is indexed anyway, so we just hit the search service with the UUID and get the item back.
This is completely decoupled. It fails if you delete an Item (which, of course, you NEVER delete anything. So, that's not a problem.) Or, if you need to move the comments. Not sure why you would do that, though.
Finally, you can comment on comments. So, your comments can have comments that comment about the comments.
I'm recording guitar parts in my car again while I wait for band practice to start. YOU CAN RECORD DECENT SOUNDING ALBUMS WHILE SITTING IN YOUR CAR. I love the present.