Alvin's Newsletter: No. 9
Weekly newsletter on what I saw interesting in tech, venture capital and business.
📰 News
Tech and the latest round of anti-trust: We were due to see the 4 largest tech CEO’s, Apple, Google, Facebook and Amazon, appear in-front of a House Judiciary Committee tomorrow but this been postponed due to a memorial service for the late Rep. John Lewis. It will be a blockbuster event when it gets rescheduled but it is unclear what is to be done and or if it should be done at all, especially given the current context of the geo-politic tensions and Covid. Each of the companies are mostly dominating in quite different digital verticals for different reasons. As such, the anti-trust arguments and conditions are quite different for each of them. Layer on on-top of that that the digital cycles today are much shorter than when the last anti-trust movement took place against Microsoft 20 years ago. By the time any action actually takes place - the landscape and conditions may have changed anyway. Looks to be a long way away before anything happens. Link
Google’s checkout button goes free: Google made their ‘Buy on Google’ checkout commission free and more importantly, made it open to third-party providers starting with PayPal and Shopify. Lots of activity in payments and retail riding the Covid offline -> online tail-winds. We don’t often see fees like this completely dropping away, a sign that Google is prepared to take the hit to play the long game. Link
More Reliance action: I talked about Jio a couple of weeks ago. Jio’s parent, Reliance Industries, is in many many verticals across India through their subsidiaries. One of their largest is retail. Amazon is looking to get into Reliance Retail by buying a 9.9% stake. Somewhat defensive play on Amazon’s part as Reliance Retail launches their Amazon India competitor, JioMart. No numbers yet. Link
📚 Reading
Hedge fund manager John Hempton has made a business out of shorting stocks. He was one of those who had been shorting Wirecard for over a decade. This article goes into how he still lost money on Wirecard - even though he was right in the end. [Paywall] Link
On how to become a unicorn in less than 2 years - buy it. We go into Therasio - a company that buys Amazon third-party private label businesses. It holds the title for the fastest profitable company in the US to become a unicorn. Interesting question at the end is where else could this be done in the digital economy? Link
Peter Thiel on progress and stagnation. I haven’t read it yet because it is a huge Google doc of his thoughts. Whilst I don’t agree with many of his positions on topics, I do applaud his contrarian take on matters. This pushes the discourse forward and makes my/your own positions stronger by examining the other angles. More often than not - Thiel provides these angles. Link
TikTok’s rise in the west has been spectacular. But how did it actually happen? What mechanics did they use? Here is an excellent article on how TikTok went about it’s assault. Here is a tidbit - nearly 13% of all ads seen be users of Facebook in 2019 were for TikTok. Incredible spending. It is also interesting to note how Facebook/Instagram have allowed a competitor to be built on-top of its own platform without partaking (besides that ad dollars). A competitor being anything else that takes up your ‘free’ time. Link
🦖 Entertaining & Interesting things
Netflix’s mediocre shows and movies and their ability to get us to watch them. Link
Google doesn’t know what to do with the Pixel (or Android). Link
Pricing and arbitrages in markets. Link
‘Good enough theory’ - incumbents don’t have to build a better product typically, just good enough to discourage users to jump ship. Link
Wired on Steve Jobs and the G4 cube from 20 years ago. The G4 was a commercial failure but it highlighted a key trait of Jobs and indeed the most successful people - the ability to change positions, even strongly held ones. Link
Troy Hunt on building the ultimate home office. Link
🎧 Podcasts
The best podcast episodes last week according to Bosco Tan:
Samsung and the Lee Family (Brought to you by… ) – 35 mins: In less than a century, Samsung has become one of the worlds biggest makers of electronic products. Yet it is still run by the family that started it all. Here’s the story of humble beginnings to save an impoverished South Korea, stretching to an inferior global challenger to becoming one of the biggest brands globally today. However the biggest leadership challenges are ahead - will they still be able to keep it in the family? Link
The Lululemon Story (Noah Kagan Podcast) - 25 mins: Lululemon has been in the news of late, buying the New York based at-home fitness-tech company Mirror for US$500m. Here, Chip Wilson, Lululemon’s founder talks about his product and marketing journey as a principle architect of the “athleisure” category that exists today. Link
New Series – The WeWork Story (Foundering) – 33 mins: The collapse of WeWork was perhaps one of the biggest tech stories in 2019. Due in particular to the scale of the collapse and the peculiarities of its founder Adam Neumann. This series traces the entire history of the company up to its unsuccessful IPO and beyond. Episode 1 here covers the backstory of Adam how we may have got to his vision. Link
How to Invest in Chinese Tech (Village Global) - 35 mins: China has been a big theme of podcasts I’ve listened to and this is one that probably covered the most ground. Tsingyuan Ventures found success over the past decade by investing in companies started by top tier Chinese students that studied and worked abroad in the US. This track record provides a unique view on the future of how innovation will flow between China and the world. Link
📹 TikToks
Qantas 747 flying over Sydney for the last time. Link
How quick your reactions need to be in F1. Link
Keep the fire burnin. 🔥 Link