The New Normal

28 10 2008

I’m generally a Mark Cuban fan, and he illustrated a point I’ve been thinking about lately with this blog post about the “new normal”.

I’m not smart enough to know exactly how things will look in 10 years, but I’d be willing to bet that the rate of change has accelerated beyond any other 10 year period in recent history. I agree with Cuban that what happened in the financial markets over the last month can’t be analyzed in terms of historical norms. “Normal” just fell off a cliff with the Dow.

Warren Buffett is as likely as anyone else to know what is going on, and he’s buying. However, even Buffett would tell you he doesn’t have a crystal ball.

There will be innovators who will correctly predict how the dominoes fall as a result of the current financial environment, and they will make a fortune. This is a huge opportunity for anyone who has patiently, consistently stayed on top of their industry waiting for a reshuffling of the pecking order. I’m paying my respects in advance for their ingenuity.

However, most of us (me included) are probably too stunned to know what to do and will by default do nothing. We’ll stuff cash in our mattresses and wait for some indication of where things are going. I’m not being critical, nobody can be an expert at everything, and turning the current crisis into an opportunity will take a decent amount of luck in addition to quick thinking. But my hat’s off to those who innovate their way out of 2008, and correctly predict the future by creating it.





Book Recommedation: Better by Atul Gawande

28 09 2008

If you’re looking for a quick, meaningful, and thought provoking read try Better: A Surgeon’s Notes On Performance by Atul Gawande. Standing in a book store before a long flight, the subtitle caught my attention, and I decided to pick it up. My grandpa is a surgeon and I’ve always been fascinated with his work, so I was curious what a surgeon would have to say about performance, and presumably achieving better performance.

Better was great. Several stories about how health care providers have gotten better at hand washing, treating cystic fibrosis, and delivering babies, for example. The great common theme is that a few simple modifications in thinking and/or behavior can have great impact. For a surgeon, this means more patients live.

One suggestion that Gawande makes that I wanted to call out is to count something.

Regardless of what one ultimately does in medicine - or outside medicine, for that matter - one should be a scientist in this world. In the simplest terms, this means one should count something…It doesn’t really matter what you count. You don’t need a research grant. The only requirement is that what you count should be interesting to you.

Gawande shares the story of Dr. Virginia Apgar, creator of the Apgar Score. Dr. Apgar overcame several hurdles to become a doctor, and made a huge contribution to the mortality rates of infants by creating a simple scoring mechanism that rates how healthy a newborn is at birth. She observed that many newborns born with conditions such as low birth weight, blue skin, or weak breathing were essentially left to die. She began scoring newborns’ conditions in her own hospital, and later published the scoring system. It turned out that by simply quantifying a newborn’s state, doctors changed how they administered treatment and as a result, thousands of young lives are saved each year.

I don’t know what I’ll count, but I will try counting something.





Generation ADHD

25 07 2008

Do you ever find yourself in one of those conversations where you wonder how you got through high school without a cell phone? Or how people were ever productive without email?

I was in a conversation that was heading that direction, but it took a turn. I found myself asking, “What would I do without the Internet? Could I make it through an entire day at work completely offline? How about a week? a month? And then I thought, “How did my grandparents work their entire careers without ever checking a score on espn.com, or catching up over IM, or taking a few minutes to watch someone get hurt really badly on YouTube?” Basically, how could you just…work?

That’s the thought that caught me off guard. I started feeling pretty flighty for how dependent I am on the Internet, and how weak my generation’s work ethic seems in comparison to our parents and grandparents. We’ve done some great things, no doubt, but could we survive 40 years of selling insurance to names in the White Pages? I don’t think I could.

I got my first email address when I was 18. First cell phone at 21. I stumbled into Napster at 22, first used instant messenger at around 23, joined my first social network and tinkered with day trading at about 24, started my first blog at 25, and discovered the wonders of RSS that same year. Sometime during all of that I created accounts on eBay, Amazon, Flickr, and started texting but I couldn’t say exactly when. Now a few years later on any given day I’m on several of the above plus Facebook apps, a couple forums, Techmeme, iTunes, and whatever beta signup Techcrunch is giving away that day. Thank goodness I’ve mostly avoided Twitter so far, but the iPhone app store has proven too much (if you like your job and want to keep it don’t download Enigmo).

What’s funny is I always have considered myself a hard worker. I even have this get-down-to-business quote by Lance Armstrong within arm reach of where I’m typing this post:

“Everybody wants to know what I’m on. What am I on? I’m on my bike bustin’ my ass six hours a day. What are you on?”

Ignore the fact that not too long ago I wrote a post on work. I’m nowhere near my Grandpa, a farmer in his 90’s who still pulls his boots on six days a week. And that worries me a bit.

The Times (UK) published an article that accuses pretty much all of us of chronic distraction. It says we have fallen slave to hundreds of daily interruptions - mostly perpetrated by the Internet - and that they’re slowly ruining us. Sounds a bit Chicken Little, but it obviously resonated enough to make me read it. OK I skimmed it. (3 chat windows open at the time, can’t keep people waiting.)

Taken to its logical conclusion, how does this end? It ends with my generations’ contribution to the world marginalized by millions of little ding! noises. Our media consumption habits are the dietary equivalent of cotton candy, yet we’re expected to solve some of the toughest problems our world has ever faced.

Has technology made us more efficient? Absolutely. But we’re kidding ourselves if we think we can equal our parents’ accomplishments without equaling their work ethic. At some point, we’ve all got to simply disconnect and get back to work (1). I’m not calling for an all out boycott of the web. I’m just saying that we all could stand to hit refresh a few less times each day, and set the bar a little higher on where we invest our attention. It’s not just required of us, we wouldn’t expect anything less of ourselves.
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(1) I see the irony in publishing this on a blog, but I don’t think blogs - good ones at least - are the culprit. (This does not apply to Perez Hilton.) Blogging is a great way to vet ideas, and “there is nothing more powerful than an idea whose time has come.” (Victor Hugo)





My new friend Tina from China

15 07 2008

Dear friend (wow, I feel like we ARE friends),

     I am Tina Meihwa from China (Hello, I am Bill from United States), I send you this message because I think everyone need health (You know you’re right, what have if no health?). You are healthy enough (Oh stop), but nobody refuse to be more healthy. Maybe you are beautiful girl, maybe you are handsome boy, or grandmother (Tina, you know me so well), we congratulations on your health . We produce infrared sauna rooms to help people become much more strong, much more beautiful, handsome (This sounds perfectly safe Tina, please go on).

     …We mainly use the global SPA phototherapeutics(?!?) through human body’s five senses: sight, smell, hearing, taste and touch to please their mind and body, Which can make people’s dream come true such as healthy, beautiful and joyful (Healthy, beautiful, and joyful being the 3 inalienable rights).

Best regards,
Tina Meihua

I’ll be sure to post a review of my new global SPA phototherapeutics infrared sauna room just as soon as the funds clear Mr. Muhammadu’s account in Nigeria (I know what you’re thinking, but this is rock solid - he’s the son of the Minister of Tourism).





Tiger Woods: Mental Toughness

17 06 2008

“The will to win means nothing without the will to prepare.” - Juma Ikangas, winner 1989 NYC Marathon

Two of my favorite authors are Malcolm Gladwell and ESPN’s Bill Simmons; Gladwell for his ability to make ordinary things fascinating and Simmons for his hilarious take on the psyche of a sports fan. Coincidentally they had an email exchange that was posted here.

Cue Gladwell:

“This is actually a question I’m obsessed with: Why don’t people work hard when it’s in their best interest to do so?

“The (short) answer is that it’s really risky to work hard, because then if you fail you can no longer say that you failed because you didn’t work hard. It’s a form of self-protection… If you get drunk the night before an exam instead of studying and you fail, then the problem is that you got drunk. If you do study and you fail, the problem is that you’re stupid — and stupid, for a student, is a death sentence. The point is that it is far more psychologically dangerous and difficult to prepare for a task than not to prepare. People think that Tiger is tougher than Mickelson because he works harder. Wrong: Tiger is tougher than Mickelson and because of that he works harder.” (Emphasis added)

Like many other American information workers, I was mesmerized by today’s US Open. Tiger showed us what is so great about sports, and Rocco Mediate is due his respect for pushing Tiger to show his brilliance in order to win. If you didn’t catch it, Nike aired an ad that featured Earl Woods (Tiger’s late father) talking about Tiger’s incredible focus:

We can’t all be Tiger, but we can work like Tiger.





It’s about execution

13 06 2008

and a bit of luck.

I’m tired of the accusations against Mark Zuckerberg. He didn’t “steal” anything. Like most great ideas, its time had come. It was in the air.

This isn’t just a Facebook thing, most great inventions emerge with a little bit of controversy. They can’t even say for sure if Alexander Graham Bell really invented the telephone. He may have been beaten by a few hours.

So get over it. From the Rolling Stone article, here’s the salient line:

Wherever the idea for Facebook came from, it was Zuckerberg’s version that went viral throughout college campuses that spring.

That’s it. Atta boy Mark.





Warren Buffett bets hedge funds can’t beat the market

10 06 2008

Fascinating news from money.cnn.com: Warren Buffett reaffirms his distaste for sophisticated investment vehicles, this time putting up some serious cash to back it up. Well, serious for me. Probably not for him.

The Sage has bet Protege Partners, a fund of hedge funds, $1 million (sort of - more on that in a minute) that, net of all fees, the Vanguard S&P 500 index fund will beat the average of 5 funds of hedge funds chosen by Protege over the next 10 years. Although it’s not disclosed, you can assume that Protege itself is one of those 5. The bet took effect on Jan. 1 of this year. Each party put up $320,000 to purchase a Treasury bond that will be worth $1 million at the end of the bet, at which time the money goes to the winner’s charity. This is apparently a standing offer that Buffett made in May 2006.

Seems to me that Buffett is just toying with these guys. “Sure, I’ll take your bet. Knock yourself out, kid.” As for Protege, they already got their money’s worth. Not everyone gets to make a bet with Warren Buffett, let alone a big one. However, if Buffett wins (60% likely according to Buffett, 15% likely according to Protege) I’m sure it won’t be reported. It’s no longer news when Buffett makes the right bet. Now if Protege wins, then they’ll make a big deal out of it. But this bet is all about the PR value right now, not financial performance 10 years from now. In that respect, Protege’s money was well spent.

As intriguing as hedge funds are, I’m an index fund guy - I subscribe to Mark Cuban’s theory that the best investment is made with an information advantage, which you and I don’t have in public companies. However, it’s simply not practical to invest your meager savings in startups where you can have an information advantage. That leaves index funds as the most reasonable investment. Fees, transaction costs, and management expenses drain most mutual funds and hedge funds of the really good returns. I’m with Warren on this one.





My worst nightmare

3 06 2008

I love cycling. That’s why I probably take notice more often than your Average Joe of car-related cycling deaths, which happen all to frequently.

So when I saw this image on CNN, I literally gasped:

Be careful out there people. And please - PLEASE - watch out for cyclists.





New York Venture Fund: NYC Seed

3 06 2008

The NY Times is reporting that Mayor Bloomberg has launched a new seed stage fund for pre-revenue and pre-product technology startups in NYC. Called NYC Seed, the fund has a few interesting details:

  • First-time founders are encouraged
  • NYC Seed will make investments of up to $200,000
  • NYC Seed will provide guidance from VCs, entrepreneurs, and technologists - presumably from the NYC area
  • Companies must be located in NYC

So, will this work? If by ‘work’ you mean recreate Silicon Valley, then probably not. Silicon Valley has a mindset that is extremely accepting, both financially and socially, of the failure inherent in developing new technology companies. However, if the measure of NYC Seed’s success is adding fuel to the burgeoning startup community forming in New York as in other cities, then yes I think this is a good start. They are incorporating several key ingredients of an evolving technology venture model: young founders, small investment amounts, and an involved mentor community.

Best of luck to these new companies and their founders.





How much is culture worth? $1000 per FTE for Zappos.

20 05 2008

Zappos gets lots of love. Their customer service is legendary, which is incredible given that they expect revenues to approach $1 billion in 2008. That’s a lot of feet to make happy.

As startups obsess about their culture, there is an inevitable ‘corporatization’ that takes place when it’s no longer possible to know every one of your coworkers. How has Zappos maintained a culture of customer service among all 1600 employees? The answer lies in “The Offer“:

“It’s a hard job, answering phones and talking to customers for hours at a time. So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period. After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.” The fast-growing company, which works hard to recruit people to join, says to its newest employees: “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” - Bill Taylor

Isn’t that incredible? It is worth a grand to Zappos to find out now, rather than later, if their new employees buy in to the culture or not. Think of the ROI on that investment - Zappos has defied the odds and built an invaluable brand by creating a culture of fanatical service, and ingrained that culture with tangible policies and practices. Hats off to them.

What’s scary is that this is your competition and mine. Doesn’t matter if you sell shoes or houses or laser beams. This is the bar we are all measured against.