25iq

My views on the market, tech, and everything else

A Dozen Things I’ve Learned From Bill Campbell

1. “Growth is the goal and growth comes through having innovation. Innovation comes through having great engineers, not great product-marketing guys.” “Empowered engineers are the single most important thing that you can have in a company.”  “[An innovative culture is] where the crazy guys have stature, where engineers really are important…The Campbell School is that engineers need to have clout.” I’ve seen businesses dominated by a single discipline many times. […]

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A Dozen Things I’ve Learned From John Doerr

1. “Swing for the fences when your time is right.” What John Doerr is talking about is the so-called Babe Ruth Effect. Michael Mauboussin writes: “a lesson inherent in any probabilistic exercise: the frequency of correctness does not matter; it is the magnitude of correctness that matters.” When you find an obvious bet with a big upside and a relatively small downside (i.e., positive optionality), bet big! That won’t happen very often, but […]

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A Dozen Things I’ve Learned from Paul Graham

1. “Y Combinator is a minor league farm club. We send people on up to VCs.” Paul Graham successfully found a role for Y Combinator in the startup ecosystem which has allowed it to thrive. He is saying that Y Combinator is dependent on other investors to provide growth capital to its graduates and that it will continue to specialize in what it does best. Roelof Botha of Sequoia puts it […]

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A Dozen Things I’ve Learned From Heidi Roizen

  1. “Even though the numbers [in the entrepreneur’s business model] will likely be wrong, your thinking behind how you arrived at those numbers is critically important. Think of each assumption as a dial.  Which ones connect to things that matter, and what impact would they have on your ultimate outcome if they turn out to be only half as effective – or then again twice as effective? Of the […]

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A Dozen Things I’ve Learned from Ann Winblad

1. “We don’t fund inventions. We like inventions.” “We don’t fund products. We only fund software companies.”  Two important points are being made here by Ann Winblad.  The first is that she decided early in her career as a venture capitalist to only invest in software companies. She was ahead of her time in understanding the value of software and the value of specialization.  Mark Suster writes: “The VC structure is changing and […]

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A Dozen Things I’ve Learned from Jim Breyer

1. “I’ve learned that when the pessimism is high, dial up the investment pace. When the optimism is high, take a breather.” This is a version of Warren Buffett’s admonition that investors “should try to be fearful when others are greedy and greedy when others are fearful.” This is easy to say but hard to do, especially since the desire to run with the crowd can be so strong in humans. Most investment […]

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A Dozen Things I’ve Learned from Andy Rachleff

1. “When a great team meets a lousy market, market wins. When a lousy team meets a great market, market wins. When a great team meets a great market, something special happens.” “If you address a market that really wants your product, if the dogs are eating the dog food, you can screw up everything in the company and you will succeed. Conversely, if you’re really good at execution but […]

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A Dozen Things I’ve Learned from Peter Thiel

Peter Thiel's Matrix

  1. “Great companies do three things. First, they create value. Second, they are lasting or permanent in a meaningful way. Finally, they capture at least some of the value they create.”   “More important than being the first mover is the last mover. You have to be durable.”  “The most critical thing for every startup is to be doing one thing uniquely well, better than anybody else in the world.” […]

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A Dozen Things I’ve Learned from Jim Simons

There was so much interest in yesterday’s NYT article on Jim Simons, I thought I would do a special “Dozen Things” on Jim Simons with no commentary. 1. “Models can lower your risk. It reduces the daily aggravation.”  2. “Certain price patterns are nonrandom and will lead to a predictive effect.” 3.  “Efficient market theory is correct in that there are no gross inefficiencies, but we look at anomalies that may be […]

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A Dozen Things I’ve Learned from Fred Wilson

1. “Venture Capital is a hits business. All of the returns come from the top cohort of investments.” “The distributions of exits each year is distributed on a power law curve.” Venture capitalists working with partners select a portfolio of bets which have significant positive optionality. Over the lifetime of the fund the venture capitalists discover a very small number of blockbuster 10-2,000X hits from the portfolio. After tape measure home runs emerge, it will […]

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