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jerryking : dotcom   7

Winners in Silicon Valley put in the hard yards
October 24, 2019 | | Financial Times | by Michael Moritz 6 HOURS AGO

The genuine formula for success among Silicon Valley's "real companies" are longevity and persistence against all odds. It is no coincidence that the greatest companies to emerge from Silicon Valley and its sister regions in China share hallmarks that are very different from popular perception. These companies are never “overnight sensations”, and they have usually had plenty of close encounters of the worst kind.

Their founders will not be leading the lifestyles of the rich and famous. Instead, they will be strapped to the mast displaying single-minded devotion to their business, jealous of every minute that is not associated with the welfare and sustenance of their company.

Their reading lists will be long; they will be voracious in their willingness to learn from others; harbour insatiable curiosity; display a fetching mixture of supreme confidence and humility; and have a keen understanding of how to make the impossible possible.

They will also adopt healthy corporate habits in their early days, have a sound appreciation for how their company will become profitable and refuse to pursue a strategy for growth come what may. They will pay keen attention to unit economics, operating expenses, cash balances, positive cash flows and dilution. The founders of the flagship technology companies of the past 50 years — Intel, Cisco, Qualcomm, Amazon, Facebook, Google, Microsoft, Apple, Oracle, Alibaba and Tencent — have all shared these traits and that is true for today’s best privately held companies.......In the technology world, fatuous slogans, broken promises, unlaced basketball shoes and black turtlenecks can only get you so far. It is then that the absence of a sound business model suddenly becomes evident. It is then that heaps of protective voting rights melt away. It is then that people understand gravity has not been repealed and that patience is the best way to build what you want. That’s the life of the persistent majority.
business_models  character_traits  dotcom  founders  hard_work  illusions  Juul  ksfs  longevity  Michael_Moritz  persistence  Silicon_Valley  reading  Sequoia  single-minded_focus  start_ups  WeWork 
october 2019 by jerryking
Companies should learn from history to avoid repeating mistakes of the past
September 27, 2019 | The Globe and Mail | by HARVEY SCHACHTER.

Those who cannot learn from history are doomed to repeat it. -George Santayana
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BEST BUSINESS HISTORY BOOKS
If you want to improve your knowledge of business history, two good places to start might be Prof. Martin’s books, From Wall Street to Bay Street, the first overview of the Canadian financial system in half a century, co-written with Christopher Kobrak, and Relentless Change, the only case book for the study of Canadian business history. Beyond that, here’s three others he suggests you could benefit from:

* Northern Enterprise: Five Centuries of Business History by Michael Bliss;
* Historical Atlas of Canada, Volumes I to III with different editors;
* Madisson Database Project 2018 by The Groningen Growth and Development Centre, Faculty of Economics and Business, University of Groningen, The Netherlands.
*****************************************************************

Joe Martin, a professor of Canadian business history and strategy at Rotman School of Management, is on a mission. He believes Canadians lack sufficient knowledge of history in general and business history in particular. But rather than seize upon Santayana’s famed quote about the value of history, he points to an anonymous businessman who said, “I study history so I can make my own mistakes.”.....We fail in business schools, where virtually no courses are offered (other than at Harvard Business School, which has included history programs since its founding in 1908 and now has about 20 historians affiliated to the school). And we fail in corporations, where new leaders think history begins with their ascension and the few histories produced on the organization tend to be heavily sanitized....Certain themes recur in business history, of course. Recessions are one. Some signs suggest we may be on the cusp of one now, but each time they hit many corporate leaders seem flabbergasted, as if nobody ever experienced this situation before....Then there’s boom-and-bust. In the dot-com heyday of the late 1990s, Prof. Martin notes in an interview, he was chairman of Angoss Software Corp. and watching his net worth go up $250,000 a week. It was glorious until it started going down $250,000 a week. It seemed new, but history is littered with equivalent situations. .....At the core of understanding the history of our economy should be the baseball diamond growth model developed at the Stern School at New York University. At home plate is government because an effective political system enables economic growth. First base is a sound financial system, to allow growth. At second base are enterprising entrepreneurs to build upon that. Third base is for sophisticated managers of large corporations......As for corporate histories, he prefers them done by historians, with full access to the material, including key players. ....“Learn from history so you don’t repeat the mistakes of the past. That’s critical,”
best_of  boom-to-bust  books  business_archives  business_history  Canada  Canadian  dotcom  Harvey_Schachter  history  Joe_Martin  lessons_learned  Michael_Bliss  quotes  recessions  Rotman 
september 2019 by jerryking
Mental bias leaves us unprepared for disaster
August 14, 2017 | Financial Times | Tim Harford.

Even if we could clearly see a crisis coming, would it have made a difference?

The 2004 storm, Hurricane Ivan, weakened and turned aside before striking New Orleans. The city was thus given almost a full year's warning of the gaps in its defences. The near miss led to much discussion but little action.

When Hurricane Katrina hit the city, evacuation proved as impractical and the Superdome as inadequate as had been expected. The levees broke in more than 50 places, and about 1,500 people died. New Orleans was gutted. It was an awful failure but surely not a failure of forecasting.

Robert Meyer and Howard Kunreuther in The Ostrich Paradox argue that it is common for institutions and ordinary citizens to make poor decisions in the face of foreseeable natural disasters, sometimes with tragic results.

There are many reasons for this, including corruption, perverse incentives or political expediency. But the authors focus on psychological explanations. They identify cognitive rules of thumb that normally work well but serve us poorly in preparing for extreme events.

One such mental shortcut is what the authors term the “amnesia bias”, a tendency to focus on recent experience (i.e. "disaster myopia" the human tendency to dismiss long-ago events as irrelevant, to believe This Time is Different and ignore what is not under one’s nose). We remember more distant catastrophes but we do not feel them viscerally. For example, many people bought flood insurance after watching the tragedy of Hurricane Katrina unfold, but within three years demand for flood insurance had fallen back to pre-Katrina levels.

We cut the same cognitive corners in finance. There are many historical examples of manias and panics but, while most of us know something about the great crash of 1929, or the tulip mania of 1637, those events have no emotional heft. Even the dotcom bubble of 1999-2001, which should at least have reminded everyone that financial markets do not always give sensible price signals, failed to make much impact on how regulators and market participants behaved. Six years was long enough for the lesson to lose its sting.

Another rule of thumb is “optimism bias”. We are often too optimistic, at least about our personal situation, even in the midst of a more generalized pessimism. In 1980, the psychologist Neil Weinstein published a study showing that people did not dwell on risks such as cancer or divorce. Yes, these things happen, Professor Weinstein’s subjects told him: they just won’t happen to me.

The same tendency was on display as Hurricane Sandy closed in on New Jersey in 2012. Robert Meyer found that residents of Atlantic City reckoned that the chance of being hit was more than 80 per cent. That was too gloomy: the National Hurricane Center put it at 32 per cent. Yet few people had plans to evacuate, and even those who had storm shutters often had no intention of installing them.

Surely even an optimist should have taken the precautions of installing the storm shutters? Why buy storm shutters if you do not erect them when a storm is coming? Messrs Meyer and Kunreuther point to “single action bias”: confronted with a worrying situation, taking one or two positive steps often feels enough. If you have already bought extra groceries and refuelled the family car, surely putting up cumbersome storm shutters is unnecessary?

Reading the psychological literature on heuristics and bias sometimes makes one feel too pessimistic. We do not always blunder. Individuals can make smart decisions, whether confronted with a hurricane or a retirement savings account. Financial markets do not often lose their minds. If they did, active investment managers might find it a little easier to outperform the tracker funds. Governments, too, can learn lessons and erect barriers against future trouble.

Still, because things often do work well, we forget. The old hands retire; bad memories lose their jolt; we grow cynical about false alarms. Yesterday’s prudence is today’s health-and-safety-gone-mad. Small wonder that, 10 years on, senior Federal Reserve official Stanley Fischer is having to warn against “extremely dangerous and extremely short-sighted” efforts to dismantle financial regulations. All of us, from time to time, prefer to stick our heads in the sand.
amnesia_bias  biases  books  complacency  disasters  disaster_myopia  dotcom  emotional_connections  evacuations  financial_markets  historical_amnesia  lessons_learned  manias  natural_calamities  optimism_bias  outperformance  overoptimism  panics  paradoxes  perverse_incentives  precaution  recency_bias  short-sightedness  single_action_bias  Tim_Harford  unforeseen  unprepared 
august 2017 by jerryking
Tech startups: A Cambrian moment | The Economist
Jan 18th 2014

the world of startups today offers a preview of how large swathes of the economy will be organised tomorrow. The prevailing model will be platforms with small, innovative firms operating on top of them. This pattern is already emerging in such sectors as banking, telecommunications, electricity and even government. As Archimedes, the leading scientist of classical antiquity, once said: “Give me a place to stand on, and I will move the Earth.”....yet another dotcom bubble that is bound to pop. Indeed, the number of pure software startups may have peaked already.... warns Mr Andreessen, who as co-founder of Netscape saw the bubble from close by: “When things popped last time it took ten years to reset the psychology.” And even without another internet bust, more than 90% of startups will crash and burn.

But this time is also different, in an important way.

the basic building blocks for digital services and products—the “technologies of startup production”,...Some of these building blocks are snippets of code that can be copied free from the internet, along with easy-to-learn programming frameworks (such as Ruby on Rails). Others are services for finding developers (eLance, oDesk), sharing code (GitHub) and testing usability (UserTesting.com). Yet others are “application programming interfaces” (APIs), digital plugs that are multiplying rapidly....Startups are best thought of as experiments on top of such platforms, testing what can be automated in business and other walks of life. Some will work out, many will not. Hal Varian, Google’s chief economist, calls this “combinatorial innovation”. In a way, these startups are doing what humans have always done: apply known techniques to new problems. The late Claude Lévi-Strauss, a French anthropologist, described the process as bricolage (tinkering)..... software (which is at the heart of these startups) is eating away at the structures established in the analogue age....this special report will explain how start-ups operate, how they are nurtured in accelerators and other such organisations, how they are financed and how they collaborate with others. It is a story of technological change creating a set of new institutions which governments around the world are increasingly supporting.
anthropologists  Archimedes  bubbles  Cambrian_explosion  dotcom  entrepreneurship  Greek  Hal_Varian  innovation  innovation_policies  Marc_Andreessen  millennials  platforms  software_is_eating_the_world  start_ups  taxonomy  technological_change  urban 
february 2014 by jerryking
Lunch with the FT: Peter Thiel - FT.com
December 20, 2013 4:06 pm
Lunch with the FT: Peter Thiel

By Richard Waters

Venture capital, where success depends on picking winners in the next hot tech markets and sticking with them, seems a long way from riding booms and busts as a hedge fund manager. In Thiel’s world, however, all things are connected, as he stitches ideas together into a grand unifying theory of our times.

The pieces fit together something like this. The historically anomalous bubbles of recent years – Japan’s stock market boom of the 1980s, the dotcom mania of the 1990s, the housing finance frenzy of the past decade and, now, the government bubble – all resulted from the fact that people retained outsized expectations for the future, even as reality came up short.
"Twitter may not be enough to take civilisation to the next level"

The reason for this expectation gap, Thiel argues, is that technological progress came to a halt at the end of the 1960s. As the website of Founders Fund declares: “We wanted flying cars, instead we got 140 characters.” Thiel is still making it up to Twitter for this jab: it’s a perfectly fine company, he says, and may even be worth the high valuation placed on it by Wall Street, though he adds with deadpan irony that “it may not be enough to take civilisation to the next level”
anomalies  boom-to-bust  bubbles  dotcom  expectations  Founders_Fund  libertarians  Palantir  Peter_Thiel  Richard_Waters  Silicon_Valley  Twitter  vc  venture_capital 
december 2013 by jerryking
Portrait of a dotcom survivor - FT.com
October 24, 2011 | FT | By Barney Jopson

One Click – Jeff Bezos and the rise of Amazon.com By Richard Brandt
Penguin Portfolio $25.95/£14.99
Amazon  books  book_reviews  dotcom  Jeff_Bezos 
november 2011 by jerryking
Savvy e-learners drive revolution in education: THE CASE FOR CORPORATE UNIVERSITIES
Apr 3, 2000 | Financial Times: pg. 02 | by Jeanne C Meister:
The number of corporate universities is growing rapidly. Meanwhile,
education dotcoms are reinventing adult learning so that it is
efficient, flexible and accessible 14-hours a day; [Surveys edition]
Meister, Jeanne C.
dotcom  Freshbooks  corporate_universities  Jeanne_Meister 
november 2009 by jerryking

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