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jerryking : large_markets   21

What You Need to Know to Pick an IPO
April 7, 2019 | WSJ | By Andy Kessler.
Dig up dirt on the competition and board members, and buy to hold long-term.......How do you know which IPOs to buy? No, not to trade—you’d never get it right. Lyft priced at $72, traded at $85 on its first day, then closed at $78, only to fall to $67 on its second day. It’s now $74. I’m talking about buying and holding for a few years. Yes I know, how quaint.

The trick is to read the prospectus. What are you, crazy? That’s a couple hundred pages. Well, not the whole thing. But remember, where the stock trades on its first day is noise....... So understanding long-term prospects are critical. Here are a few shortcuts.

(1) First, glance at the underwriters along the bottom of the cover. On the top line are the banks putting their reputation on the line. If the one on the far left is Goldman Sachs , Morgan Stanley or JPMorgan , you’re probably OK.
(2) open the management section and study the directors. Forget the venture capitalists or strategic partners with board seats—they have their own agendas. Non-employee directors are the ones who are supposed to be representing you, the public investor. And their value depends on their experience.
(3) OK, now figure out what the company does. You can watch the roadshow video, look at prospectus pictures, and skim the offering’s Business section. Now ignore most of that. Underwriters are often terrible at positioning companies to the market.......when positioning companies, only three things matter: a monster market; an unfair competitive advantage like patents, algorithms or a network effect; and a business model to leverage that advantage. Look for those. If you can’t find them, pass. Commodities crumble........read the Management’s Discussion and Analysis. Companies are forced to give detailed descriptions of each of their sectors and products or services. Then flip back and forth to the Financials, looking at the items on the income statement and matching them up with the operations being discussed. Figure out what the company might look like in five years. And use my “10x” rule: Lyft is worth $25 billion—can they make $2.5 billion after-tax someday? Finally there’s the Risk section, which is mostly boilerplate but can contain good dirt on competition.
(4) Put the prospectus away and save it as a souvenir. Try to figure out the real story of the company. Do some digging.
(5) My final advice: Never, ever put in a market order for shares on the first day of an IPO.
10x  advice  algorithms  Andy_Kessler  boards_&_directors_&_governance  business_models  competitive_advantage  deception  due_diligence  howto  IPOs  large_markets  long-term  Lyft  network_effects  noise  patents  positioning  prospectuses  risks  stock_picking  think_threes  Uber  underwriting  unfair_advantages 
april 2019 by jerryking
Robotaxis: can automakers catch up with Google in driverless cars?
January 31, 2019 | Financial Times | by Patrick McGee.

A new network of small tech companies could allow the car industry to compete with Waymo.

The automotive industry is among the most capital-intensive in the world: If the economy sours, assets turn into liabilities overnight as factories churning out thousands of cars begin to haemorrhage cash. So when toxic mortgage securities blew up in 2008, causing a recession, banks performed terribly — but carmakers fared even worse.

That is what makes auto consultants at Bain so worried. They fear that carmakers are about to be hit with a one-two punch: first, they project a US recession in the next 12 to 18 months. Then, increasing numbers of baby boomers will retire, causing a structural decline so big that, they warn, US car sales could shrink from more than 17m last year to just 11.5m by 2025 — the same level seen in 2008-09, which caused GM and Chrysler to go bankrupt and Ford to suffer a $14.6bn loss.....But there is hope. If carmakers play their cards right, they could be saved by what GM has called “the biggest business opportunity since the internet”. The potential saviour is the rise of shared, driverless “robotaxis”, which Bain expects to become mainstream in some large cities in six to eight years. This new market, virtually non-existent today, promises to be huge. ... Intel projects a “passenger economy” worth $7tn by 2050....Car brands typically earn $2,000 from a vehicle sale. That is just $0.01 per km over the lifetime of a vehicle, whereas for robotaxis “the potential is 20 to 25 cents per km”,...To realise this potential the industry will need to update its entire business model. The challenge for carmakers is to gain the expertise in self-driving algorithms, in-car entertainment, streaming services and fleet management for ride-hailing that will be central to this new era......Luckily, there has been an explosion of small companies developing the skills and technologies that carmakers can make use of. .......Waymo, the Alphabet self-driving unit that began as a Google project, is widely seen as the leader in this new landscape....it has built a commanding lead since its founding in 2009. And with at least 600 of its vehicles driving more than 25,000 miles a day, it is perfecting its algorithms in a way that could blindside the competition. Last year UBS projected that Waymo “will dominate” the operating systems for autonomous vehicles, taking “60 per cent of the total projected revenue pool in 2030”.......The threat of Waymo is not that it will build better cars. It has no need to. Instead it is ordering vehicles from Chrysler and Jaguar — effectively turning them into suppliers — and then fitting them out with self-driving software and hardware built in-house. But its potential goes beyond superior self-driving capabilities. Once robotaxis are mainstream, Alphabet can collect data from Google Maps and Search, entertain with YouTube and the Play Store, offer advice through Google Home smart speakers and use its software knowhow to manage fleets. Aside from the vehicle itself, Waymo is a vertically-integrated “closed system”........Carmakers are responding by partnering up like never before and making big investments to acquire new expertise. Volkswagen has linked up with Ford, while arch-rivals BMW and Mercedes have pooled their mobility efforts. In 2016 GM paid $500m for a stake in Lyft, the ride-hailing group, and it spent more than $1bn to buy Cruise, a self-driving company.......These deals, however, are merely the tip of the iceberg. Beneath the car brands, an entire ecosystem of niche companies has spurred into existence. Known as the “data value chain”, these groups specialise in the software, sensors, data processing and navigation needed to make autonomous cars a reality. None has the willpower, resources or vision to take on Waymo. Instead, they are forming clusters, exercising “swarm intelligence” to independently work towards the same collective goal of creating a safe, driverless experience......The implications of this ecosystem are profound. It suggests the carmakers can catch the likes of Waymo up without being the best-in-class in the new technologies. They merely need to be competent enough to know who is best — and then partner with them.
Alphabet  automotive_industry  automobile  autonomous_vehicles  Bain  blindsided  capital-intensity  GM  Google  large_markets  partnerships  supply_chains  Waymo 
january 2019 by jerryking
Meg Whitman: ‘Businesses need to think, who’s coming to kill me?’
January 18, 2019 | Financial Times | by Rana Foroohar 7 HOURS AGO.

Whitman has just launched Quibi, a $1bn start-up of which she is chief executive (entertainment mogul Jeffrey Katzenberg, her co-founder, is chairman). The venture, backed by a host of entertainment, tech and finance groups including 21st Century Fox, Viacom, Alibaba, Goldman Sachs and JPMorgan, has the lofty aim of becoming the Netflix of the mobile generation, offering high-quality, bite-sized video content for millennials (and the rest of us) hooked on smartphones......Whitman's experience has left her with plenty of advice for chief executives struggling with nearly every kind of disruption — technological, cultural and geopolitical. “I think every big business needs to be thinking, ‘Who’s coming to kill me?’ Where are the big markets that for regulatory reasons, or just because things are being done the way they always have been, disruption is likely? I’d say healthcare is one,” ...... a “Quibi”, is the new company’s “snackable” videos, designed to be consumed in increments of a few minutes....“You have all these in-between moments, and that’s what inspired the length of the content,” she says. “Very few people are watching long-form content on this device,” she says, holding up her iPhone. “They’re spending four to five hours a day on their phones, but they’re playing games, watching YouTube videos, checking social media, and surfing the internet. And although [people] pick up their phones hundreds of times a day, the average session length is 6.5 minutes.”.......Whitman’s hope is that just as people now binge on hour-long episodes of The Crown or House of Cards at home, they’ll do the same on their smartphone while in the doctor’s office, or commuting, or waiting for a meeting to start. As Whitman puts it, “every day you walk around with a little television in your pocket.” She and Katzenberg are betting that by the end of this year, we’ll spend some of our “in-between moments” watching micro-instalments of mobile movies produced by Oscar winning film-makers or stars ... interviewing other stars. ....The wind was at her back at eBay, where she became president and chief executive in 1998, presiding over a decade in which the company’s annual revenues grew from $4m to $8bn. “It’s hard to change consumer behaviour. We did that at eBay. We taught people how to buy in any auction format on the internet, how to send money 3,000 miles across the country and hope that you got the product.”

Quibi, she believes, doesn’t require that shift. “People are already watching a lot of videos on their phones. You just need to create a different experience.” She lays out how the company will optimise video for phones in ways that (she claims) will utterly change the viewing experience, and will leverage Katzenberg’s 40 years in the business.

..
paranoia  CEOs  disruption  Meg_Whitman  Rana_Foroohar  start_ups  women  bite-sized  Hollywood  Jeffrey_Katzenberg  mobile  subscriptions  web_video  high-quality  smartphones  advice  large_companies  large_markets  interstitial  Quibi 
january 2019 by jerryking
Blitzscaling
ENTREPRENEURSHIP
Blitzscaling
Tim Sullivan

FROM THE APRIL 2016 ISSUE

Let’s start with the basics. What is blitzscaling?
Hoffman: Blitzscaling is what you do when you need to grow really, really quickly. It’s the science and art of rapidly building out a company to serve a large and usually global market, with the goal of becoming the first mover at scale.

This is high-impact entrepreneurship. These kinds of companies always create a lot of the jobs and industries of the future. For example, Amazon essentially invented e-commerce. Today, it has over 150,000 employees and has created countless jobs at Amazon sellers and partners. Google revolutionized how we find information—it has over 60,000 employees and has created many more jobs at its AdWords and AdSense partners.

Why this focus on fast growth?
We’re in a networked age. And I don’t mean only the internet. Globalization is a form of network. It adds networks of transport, commerce, payment, and information flows around the world. In such an environment, you have to move faster, because competition from anywhere on the globe may beat you to scale.

Software has a natural affinity with blitzscaling, because the marginal costs of serving any size market are virtually zero. The more that software becomes integral to all industries, the faster things will move. Throw in AI machine learning, and the loops get even faster. So we’re going to see more blitzscaling. Not just a little more, but a lot more.
blitzscaling  economies_of_scale  scaling  HBR  high-growth  high-impact  Silicon_Valley  LinkedIn  Reid_Hoffman  networks  first_movers  large_markets  market_sizing  accelerated_lifecycles 
may 2016 by jerryking
Michael Hyatt lays out your plan for success - Western Alumni
May 6, 2014 | Alumni Gazette|by Jason Winders, MES'10.

Shut Up and Listen

No Guarantees
Just because you have a great product, doesn’t mean you are going to make any money.

Play in a Big Sandbox
Go into a big and growing market. When you go into a big and growing market, you can probably get a slice of it – even if you are incompetent. You need a big and growing market, great people and a great product – in that order. Having a great product in a small and shrinking market with OK people, you will always make no money.

Embrace Discomfort
Discomfort, pain and sacrifice actually make the entrepreneurs. Being uncomfortable, being lonely, being misunderstood, everybody looks at the great entrepreneurs and don’t realize the struggle.

Trust No One
Your friends and family, everybody, they will tell you what you have is amazing and you’re so great and, when you bring that product out next year, they are going to buy it. It’s not true. People are trained to give niceties. Go ask all your friends and family for $10,000 to invest in your start-up, then you will find out right away what their problems are.

The Hard Truth
The ride doesn’t necessarily have any good payout....You are not always going to get what you want.

Personal Plan
Live below your means, not at your means. Invest the difference to become wealthy.

Don't Ignore the Basics
(diet, sleep and exercise).
UWO  entrepreneur  alumni  rules_of_the_game  high-growth  frugality  Michael_Hyatt  large_markets  discomforts  personal_cost  personal_sacrifice  hard_truths  personal_enrichment 
may 2014 by jerryking
So Far, Russia's Oil and Gas Allow It to Act Badly - WSJ.com
By GERALD F. SEIB | April 22, 2014

Of all the lessons one might draw from Russia's bullying of Ukraine, this may be the most coldblooded of all: If you want to behave badly, it helps to have a lot of oil and gas. Much will be forgiven, or at least ignored.

European nations, international energy companies and China are all, in their own ways, driving home the point. The Europeans are afraid of pushing economic sanctions against Moscow too far lest they be cut off from the Russian natural gas that provides a significant share of their energy.

The international energy companies are busy reassuring the Russians that they will keep working to help develop Russian energy supplies, the Ukraine crisis notwithstanding.

And the Chinese—well, they may be on the verge of completing a deal that has been under negotiation for 10 years to begin buying a lot of Russian natural gas. Russian officials said last week that they expect the negotiations to be completed before Russian President Vladimir Putin visits China in May.

For Mr. Putin, a China deal would amount to a multibillion-dollar strategic security blanket. If European nations to Russia's west don't want to buy his gas because of his annexation of Crimea and intimidation of Ukraine, never mind. He soon will have a large market for his gas to the east as an alternate.
natural_gas  oil_industry  Russia  Gerald_Seib  Ukraine  China  petro-politics  large_markets 
april 2014 by jerryking
The Four Best (and Worst) Uses of Market Research| Page 2
April 9 2013 | | ChiefExecutive.net | Chief Executive Magazine | by Taddy Hall

Experience and research suggest that CEOs of many companies look for growth in the wrong places and in the wrong ways, thereby missing opportunities and leaving them for the newbies. In a sense, though, this is good news: success lies in doing things differently, not spending more.

Specifically, there are four approaches organizations often take, none of which reliably lead to the actionable insights business leaders need:

Seek and profile large, growing and profitable markets
Solicit feedback from current best customers
Segment markets based on customer attributes, such as demographics, or based on product characteristics like “high end” vs. “low end,” “regular” vs. “light,” etc.
Benchmark progress against competitors

In each case, it is easy to see why an industry leader might have interest in the findings; however, these outputs speak primarily to aspects of the existing business or to the franchises of other established players. In other words, mapping current demand reveals little to nothing of the less-visible latent demand that is essential fuel for transformational innovation. As Henry Ford mused a hundred years ago: if he’d asked folks what they wanted, they would have asked for faster horses. Echoing Ford, Steve Jobs noted that consumers can’t describe what they’ve never experienced.
market_research  disruption  Clayton_Christensen  high-end  latent  insights  growth  opportunities  transformational  customer_insights  innovation  large_markets  market_segmentation  customer_risk  actionable_information  hidden  Henry_Ford  Steve_Jobs  market_share  static  dynamic  segmentation  missed_opportunities  hiring-a-product-to-do-a-specific-job  unarticulated_desires 
april 2013 by jerryking
In search of up-and-comers: some principles to follow
02 Dec 1995 | The Globe and Mail pg. B.18.| Gary Lamphier.

IMAGINE investing in technology stars such as California's 3Com or Ottawa's Istar Internet - last week's market darling on the Toronto Stock Exchange - long before they've gone public and other investors have jumped aboard.

That's the game venture capitalists play as they scour obscure industry publications and trade shows, attend endless conferences and swap gossip with entrepreneurs in search of tomorrow's success stories.
(1) Most want to see company principals put their money where their mouth is by investing in their own companies. Otherwise, no deal.
(2) The market that the startup company plans to sell its product into must be big and getting bigger.
(3) Any start-up company that hopes to prosper must have exceptionally strong management, the pros agree.
(4) Successful companies breed successful companies.
Sequoia  Michael_Moritz  venture_capital  vc  Kleiner_Perkins  start_ups  rules_of_the_game  large_markets  teams  skin_in_the_game  unglamorous 
july 2012 by jerryking
The Young & Restless of Technology Finance
November 1993| The Red Herring | Anthony B. Perkins.

We think that marketing is everything. We try to help our companies figure out what is going to set them apart. We encourage companies to define their biggest risks-up front, work hard to put the risks behind them, and then move forward with very innovative marketing...During the interview process, you see whether entrepreneurs have passion and tenacity. The hardest thing to determine is their ability to stick-to-it. Entrepreneurs need to be very dynamic, wi11ing to adjust. And that's why an important part of our process is checking references, we have to be convinced the entrepreneur has never give up, even when things get tough. In other words, when Plan A work, because Plan A never works, we like to hear entrepreneurs say "That's O.K.,Plan B is on its way. I've twisted this valve and turned this knob and I really think we've figured it out." What we don't like to hear is "Well,it didn't work out...sorry." We also like to see entrepreneurs who are singularly focused on building -great products that fill distinct market needs. We are less interested in people who like nice digs, hype,and PR.

Moritz: ‘We have a very tight on making sure there is a sizable market opportunity in front. of us before we make an investment. We are much more focused on market growth potential and the ability for a company to reach a market successfully and profitably. We have also demonstrated as a firm and individually the ability to get companies off the ground with a small amount of fuel. We like to start wicked infernos with a single match rather than two million gallons of kerosene. This is clearly a differentiated way of getting a company put together. This approach has terrific benefits for the people who start the companies and for all our limited partners. You might say that we have a morbid fascination with our ROI, as opposed no the amount of dollars we put to work. And this is a very different message than you get from a lot of other venture firms.
The: HERRING: How often does a Sequoia partner actually go in and help operate a company?

Moritz: Pierre is the great unsung hero of Cisco Systems. He spent a tremendous amount of time at the company. working behind the scenes helping to make sure the engineering department was designing and getting new products to market. People don't realize the significant contribution Pierre made to Cisco because Don's name is on the hubcaps as the chairman of the company. The ability we have to help operate companies is a useful tool in our arsenal.

The HERRING: Sequoia's image on the streets of Silicon Valley is that you are the Los Angeles Raiders of venture capital--the tough guys who are quicker than the other firms to boot the CEO or pull the financial plug.
Moritz: We are congenitally incapable of pouring good money after bad. Some people. for their own will thrust us into a position to be harbingers of bad new to management, which is all right. But we do not want to continue propping up a company if we think its chances for success have evaporated. We would be wasting our money as individuals and wasting the money of our limited partners. There have been very few instances where we decided to stop funding a company and have regretted it.
The HERRING: What ’s the hardest part of your job?
Moritz: We usually don't make mistakes when it comes to assessing market opportunity. And we are reasonably accurate in predicting how long it will take to bring a product to market. The great imponderable is to judge accurately and predict how well a president is going to be able to run the business. It is easy to mistake the facade for reality
The HERRING: ‘What characteristics does Sequoia look for in a company president?
Moritz: Frugality, competitiveness. confidence, and paranoia.
venture_capital  vc  howto  Kleiner_Perkins  Sequoia  career_paths  Michael_Moritz  no_regrets  endurance  frugality  competitiveness  paranoia  self-confidence  market_sizing  market_windows  team_risk  market_opportunities  ambitions  large_markets  sticktoitiveness  entrepreneur  perseverance  indispensable  Plan_B  off-plan  champions  reference-checking  unknowns  assessments_&_evaluations  opportunities  unsentimental  wishful_thinking  illusions  overambitious 
july 2012 by jerryking
Don Valentine, Venture Capitalist - Forbes
12/09/2005 @ 10:59AM |149 views
Don Valentine, Venture Capitalist
Rich Karlgaard Rich Karlgaard,

Most VCs say they invest, first and foremost, in people. Technology and markets are secondary considerations. The thinking goes: “A” people will know how to find “A” technology and “A” markets.

Valentine rejects that. He bets on markets that are ready to explode. Deep in his salesman’s bones, Valentine knew the market for microcomputers (Apple), databases (Oracle) and routers (Cisco) would go nuclear before other investors did.
Don_Valentine  Rich_Karlgaard  Sequoia  large_markets  teams  high-growth 
june 2012 by jerryking
Netflix vs. Naysayers - WSJ.com
March 27, 2007 | WSJ | By NICK WINGFIELD

CEO Hastings Keeps Growth Strong; Plans for Future After Death of DVDs. In the decade since Netflix Inc. NFLX +3.07% began renting DVDs online, CEO Reed Hastings has faced down a murderers' row of rivals.

Wal-Mart Stores Inc., WMT -0.59% Amazon.com Inc. AMZN +0.72% and Blockbuster Inc. have all piled into the market with services that mail DVDs to consumers who've ordered them over the Web.

...WSJ: You've started letting some of your subscribers watch movies from your Web site. How seriously are you pushing into Internet-delivery of movies?

Hastings: We're taking it pretty aggressively. We're investing about $40 million into it this year. We feel that that's the appropriate size investment, given the size of the market. If you overinvest in a market, of course, a lot of the money is wasted.

If you underinvest, then someone else can get ahead of you. We'll be up to 5,000 films by the end of the year, open to all of our subscribers....

WSJ: Blockbuster was once dismissive of Netflix, but now they're taking you very seriously. Did their initial attitude affect the way you view potential threats to Netflix?

Hastings: Absolutely. We have to recognize that now there are tens and maybe hundreds of start-ups who think that they're going to eat Netflix's lunch. The challenge for a management team is to figure out which are real threats and which aren't.... It's conventional to say, "only the paranoid survive" but that's not true. The paranoid die because the paranoid take all threats as serious and get very distracted.(jk....which threats are worthy of my attention?==> distinguish between illusory and legitimate threats and fears.)

...WSJ: What are some examples of how you were choosy in reacting to potential threats to Netflix?

Hastings: There are markets that aren't going to get very big, and then there are markets that are going to get big, but they're not directly in our path. In the first camp we have small companies like Movielink -- a well-run company but not an attractive model for consumers, sort of a $4-download to watch a movie. We correctly guessed when it launched four years ago that this was not a threat and didn't react to it.

The other case I brought up is markets that are going to be very large markets, but we're just not the natural leader. Advertising supported online video, whether that's at CBS.com or YouTube -- great market, kind of next door to us. But we don't do advertising-supported video, we do subscription, so it would be a huge competence expansion for us. And it's not a threat to movies.
Netflix  Reed_Hastings  CEOs  DVDs  downloads  streaming  subscriptions  threats  large_markets  discernment  paranoia  distractions  overextended 
june 2012 by jerryking
What Business Would You Start?
Mar 1, 2002 | Inc. Magazine |By Thea Singer.

The simple answer to the question 'How do you do this?' is, you find a really large market -- or one that's going to be large -- that's inefficient, and you come up with a breakthrough way of delivering value to customers that nobody has ever done before.
start_ups  advice  entrepreneur  opportunities  Dell  demographic_changes  financial_services  healthcare  education  travel  large_markets  inefficiencies 
may 2012 by jerryking
Rules to Live By, and Break, According to Staples Founder Thomas Stemberg - Knowledge@Wharton
January 14, 2004 in Knowledge@Wharton

Thomas Stemberg, founder and executive chairman of Staples, an office products retail chain, doesn’t buy one piece of advice that is often given to aspiring entrepreneurs: Follow your passion.

These words have spawned a stream of bankrupt restaurants and golf companies. “I think following your passion is a really dumb idea. I follow a great market that provides an opportunity to satisfy customers and to make money.”....Most of the dozens of business plans Stemberg sees each week propose marketing improvements of products or services that already exist. “None of these are good ideas,” he said. “Great ideas are [based on] identifying a true need in the marketplace and then finding a way to service it.”
Thomas_Stemberg  Staples  entrepreneur  problem_solving  market_sizing  passions  large_markets 
november 2011 by jerryking
What You Need to Succeed - Thomas Stemberg - Highland Capital Partners
By Thomas Stemberg | Jan 1, 2007

business plans are interesting chiefly as indications of how an entrepreneur thinks. Here at Highland Capital Partners, the venture capital firm I'm part of now, we spend most of our time talking about what really matters: management and market. If you have the right management team and an exciting market, the rest will take care of itself. I suspected that was true before I came here--it had always been true for me. Now I know it for a fact.

(1) The right people: Folks who have been there and done (something like) that.
(2) The right market: Preferably, it involves an absolute mob scene.
(3) The right answers: Sometimes you need an outside perspective.
Staples  entrepreneur  business_planning  venture_capital  Lululemon  Highland_Capital  fresh_eyes  large_markets  outsiders  the_right_people  what_really_matters 
november 2011 by jerryking
Scouting staffs are the true All-Stars in salary cap era
4/3/2008 | USATODAY.com | By Kevin Allen
When the salary cap was introduced, the league was supposed to be about younger free agents moving from team to team.

Instead, it's probably more about scouting and drafting than it has ever been....The salary cap system was supposed to be about all teams being on equal financial footing and general managers, from large and small markets, being able to jump into a rich free agent pool every summer....The key to staying in contention is having a steady stream of inexpensive younger players stepping in ...With the salary cap preventing large market teams from stockpiling talent, there is indeed less tolerance and patience for any long-term rebuilding plan. General managers are expected to repair as they rebuild....a poor drafting history now hurts a franchise far more than ineffective penalty killing. Good coaching can solve problems, but it can't overcome a lack of talent....if management is smart in those cities, what it should do is overhaul the thinking, or perhaps the personnel, making the drafting decisions. To win in this league, you need as many All-Stars on your scouting staff as you need in your lineup.
scouting  Octothorpe_Software  talent_management  talent  sports  salaries  large_markets  talent_scouting  stockpiles 
october 2011 by jerryking
Stop Looking for Ideas, Look for Problems to Grow Your Business - India Chief Mentor - WSJ
April 19, 2010, | WSJ | By Gautam Gandhi. Stop looking for
good ideas. That’s right, you read this correctly. Please don’t speak of good ideas ever again. Instead tell me about good problems. They'll most likely bring a business opportunity, Where are the problems?

If you look around there are problems everywhere. Question things you
take for granted and think to yourself: Is there a better way? When you
have your next business meeting, whether it is with a client or
customer, ask them what their biggest problems are. You will be
surprised by what people tell you. Hopefully, you will start to notice
patterns and will soon identify a problem to solve. Better still, if it
is a problem that affects you directly.

When you think of the problem that you are going to solve, ensure that:

You are tackling it for a sizable market
People are willing to pay for your solution
You assess your rivals

The last one is important. Never think: “I don’t have any competition.”
growth  problem_solving  pattern_recognition  idea_generation  problems  challenges  worthiness  messiness  uncharted_problems  large_markets  competition  questions  ideas  assumptions  criteria  India  pain_points  discernment  curiosity  dissatisfaction  opportunities  inquisitiveness  Michael_McDerment  worthwhile_problems 
july 2011 by jerryking
THE BIGGEST GROUPS ARE ILL WITH INEFFICIENCY
April 06 2011 | FT | Luke Johnson
● Sunk cost fallacy:
● Groupthink:
● An obsession with governance:
● Institutional capture: the phenomenon whereby mgmt. end up running an
enterprise for their own benefit, rather than for the real owners. Also
known as the principal/agent problem.
● Office politics: self-destructive infighting for power within large
businesses is endemic, and perhaps the biggest value destroyer of all.
● Lack of proprietorship:
● Risk aversion: in large corporates, the punishment for management
failure is greater than the rewards for success. So, rational
individuals pursue cautious strategies to avoid damaging their career
prospects. (aka "playing it safe")
● The burden of history: many older companies have legacy issues such as
pension scheme deficits, union contracts, inefficient equipment and so
on.
● Anonymous mediocrities: there is nowhere to hide in a small company –
if you can’t deliver, you’re out.
● Commodity products: large companies need large markets,
playing_it_safe  start_ups  inefficiencies  size  groupthink  Luke_Johnson  large_markets  large_companies  bureaucracies  risk-aversion  mediocrity  owners  office_politics  commodities  self-destructive  brands  legacy_tech 
april 2011 by jerryking
Geoff Vuleta Has New Ideas for Consultancy Firms
June 1, 2010 | Fast Company | By: David Lidsky. The New
Zealander and former ad man develops large-scale growth initiatives for
major firms seeking $100 million-plus in new revenue. He makes money
only if the idea works: "
entrepreneurship  ideas  innovation  inspiration  large-scale  management_consulting  growth  jck  size  scaling  large_markets  new_businesses 
may 2010 by jerryking
The Internet Report
February 1996 | Morgan Stanley U.S. Investment Research pg. 41 |
by assorted writers. When looking for investment ideas in new markets,
we default to our favorite maxims from Don Valentine of Sequoia Capital,
who is known as one of the toughest and smartest technology venture
capitalists in Silicon Valley. Don follows several simple rules in
choosing early-stage tech investments: (1) Find “monster” markets that
can be really big, like the Internet; (2) find good technology and good
technologists who can stay ahead of competitive threats; (3) find
outstanding leaders/management teams that can drive the technologies and
markets forward; and 4) buy companies, not products, and try to find
companies that have achieved critical mass with their products — or can
achieve it, and can create some form of “barriers to entry.”
barriers_to_entry  buying_a_business  critical_mass  Don_Valentine  engineering  good_enough  high-growth  investors  large_markets  leaders  Mary_Meeker  Morgan_Stanley  rules_of_the_game  Sequoia  teams  technology  vc  venture_capital  filetype:pdf  media:document 
february 2010 by jerryking
VC Confidential: Wisdoms of Sequoia's Don Valentine
November 15, 2007 | VC Confidential | by Matt McCall.
"The trouble with the first time entrepreneur is that he doesn’t know what he doesn’t know. After a failure he does know what he doesn’t know and can beat the hell out of people who still have to learn."

"That's easy. I just follow Moore's Law and make a few guesses about its consequences." (on his success investing in semiconductor plays)

"I got to Silicon Valley in 1959. Nothing is revolutionary; it's evolutionary. Look the sequence of Intel microprocessors. It's all predictable. The nature of silicon and software and storage go hand in hand. In the case of software, you just have to be more clever about the nature of the application. So all these things kind of tick along, feeding off each other"

“All companies that go out of business do so for the same reason - they run out of money.”

"Why did you send me this renegade from the human race?" (comment after meeting Steve Jobs)

"Great markets make great companies."

"I like opportunities that are addressing markets so big that even the management team can't get in its way."

"One of my jobs as a board member has been to counsel management to avoid distraction and to execute with constructive paranoia."
boards_&_directors_&_governance  distractions  Don_Valentine  failure  large_markets  Moore's_Law  paranoia  pretense_of_knowledge  quotes  Sequoia  Steve_Jobs  vc  venture_capital 
january 2010 by jerryking
Google's Banker
May 3, 2004 | Fortune | By Adam Lashinsky.... Valentine also
took a different approach on making investments: He bet on the
racetrack, not the jockey. "... you build great companies by finding
monster markets that are in transition, and you find the people later,"
says Valentine...."But in Moritz, Valentine saw a resemblance to another
precocious go-getter he had observed at close range: Steve Jobs.
"They're both incredibly aggressive questioners," says Valentine. "And
our business is all about figuring out which questions are relevant in
making a decision, because the people who are starting a company (i.e. the founders) don't
have a clue what the answers are."... Valentine's principles: only
targeting businesses with fat margins; avoid capital-intensive
businesses; take measured steps; never underestimate the difficulty of
changing consumer behavior; don't begin a rollout until you're sure the
recipe is working; avoid any business Wall Street is prepared to throw
hundreds of millions of dollars at.
behavioral_change  capital-intensity  consumer_behavior  disequilibriums  Don_Valentine  founders  large_markets  margins  Michael_Moritz  precociousness  questions  rollouts  rules_of_the_game  Sequoia  Steve_Jobs  vc  venture_capital  Wall_Street 
october 2009 by jerryking

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