jakarta

it demonstrates that investors want to see a return on their investment more quickly in a higher cost of capital environment. Look across tech, all of these companies staffed up hard, raised at too high of valuations, and are now fat with slow growth and no profitability.

Looks like the stock is up 11% on this news. Does this and the the staff cuts at X demonstrate you can take out significant numbers of engineer without drastically impairing the user experience?

I doubt most tech execs would have the wherewithal to make this kind of decision but it's clearly the case that many big tech cos staffed up too hard during the pandemic with average salary per employee rising too much

hopefully by now companies realize parachuting in ex-AMZN employees is a recipe for disappointment, esp in terms of cost relative to work output

a few million? I would guess ~$100mm

Nice unit economics: Our Connected Fitness Subscriber Lifetime Value for fiscal 2017, fiscal 2018, and fiscal 2019, was $267.1 million, $604.4 million, and $1,053.8 million, respectively, or $3,433, $4,015, and $3,593 per Connected Fitness Subscriber, respectively.

As we expand our content offering, develop new interactive software features, and grow our community of Members, we believe we can maintain a low Average Net Monthly Connected Fitness Churn, resulting in a high Connected Fitness Subscriber Lifetime Value. In addition, with the growth of our Connected Fitness Subscriber base over time, we expect to improve our Subscription Contribution Margin as we scale our fixed content production costs.

Net Customer Acquisition Cost (profit) can be calculated as Adjusted Sales and Marketing Expense (which excludes depreciation and amortization expense and stock-based compensation expense) less Adjusted Connected Fitness Product Gross Profit (which excludes depreciation and amortization expense and stock-based compensation expense). Our Net Customer Acquisition Costs (profit) for fiscal 2017, fiscal 2018, and fiscal 2019, was $14.2 million, $(4.9) million, and $1.6 million, respectively, or $183, $(33), and $5 per Connected Fitness Subscriber added, respectively. We believe we will continue to drive rapid payback and efficiencies in Net Customer Acquisition Costs (profit) by further leveraging sales and marketing investments as a result of heightened brand awareness and growing word-of-mouth referrals. Changes in Connected Fitness Product margins or sales and marketing expenses may result in an inability to fully offset our customer acquisition costs.

why would the cohort expansion rate be so much lower than Fastly's? https://www.sec.gov/Archives/edgar/data/1477333/000119312519... ^ cloudflare data on p. 80 shows a rate of 10-15% expansion

https://www.sec.gov/Archives/edgar/data/1517413/000119312519... ^fastly data on p. 66 shows cohort expansions that are much faster

I could never get into Farnam Street because it just seemed like appropriating Charlie Munger's mental models to sell self-help services.

I'm more intrigued by something like Online Great Books (https://onlinegreatbooks.com/) which seems like a lot of effort but would probably force me to widen my knowledge - In reality, I wish something like Online Great Books included some first principles math/science books to round it out more beyond the philosophy/literature bent.

If only their customer service could match Metro Bank

Interactive Brokers does not sell your order flow

Equity is not a measure of actual worth, it's a product of accounting conventions (which are increasingly incorrect)

A company's value is the free cash flow available to owners from now to kingdom come discounted back to the present.

Waymo progress seems to be slowing on critical disengagements (in older CA DMV reports these were called "safe operation disengagements" - they stopped reporting this type in 2017). These disengagements deal with perception issues, the software leading to unwanted maneuvers, inability to react to reckless road users, and incorrect predictions.

You can see it reduced rate of improvement when you dig into the numbers:

2015 0.16 disengagements per 1000 miles

2016 0.13 disengagements per 1000 miles

2017 0.12 disengagements per 1000 miles

Kyle Vogt blog post on the deal: https://medium.com/kylevogt/how-were-solving-the-lidar-probl...

what is wrong with their technology?

you are confusing valuation with shareholder's equity

Berkshire fundamentally was not a good business, he invested in a textile firm right around the time the North American textile industry started to face really heightened global competition. If I recall correctly, in '64 Buffett took control and tried to keep the thing going and had the mill invest some of its cash flow into the business, but all those investments ended up worthless as the mill eventually had to shutter. He could have deployed the capital elsewhere and earned positive returns.

Eventually (circa '67)he realized it was a lost cause and stopped investing in the mill, instead he used its cash flow to go out and invest in other companies (insurance, etc) which remain there to this day.

I'm an analyst at a hedge fund, I have a job as a generalist so I look at pretty much every asset class/geography/industry.

Historically have done very little investing in tech, but I'm interested in it and HN is a good way to keep up with the industry.

I look at startups as businesses or industries where the rate of change is much faster than normal. I think as an investor you're really a student of business and that makes startups a really fascinating area to observe.

How are you balancing GSLP with 5k running so far?

Are you running on rest days or doing a combo?

You seem really sure of yourself.

Here's the counter argument from a noted short seller:

http://brontecapital.blogspot.com/2013/07/it-was-night-befor...

http://brontecapital.blogspot.com/2013/01/notes-on-visiting-...

I think the best example of recruiting good members is the SumZero model. SumZero is a buyside investor site, where buysiders can exchange and rank investment ideas with each other. It was started by Divya Narendra of Facebook fame.

When I first signed up for SumZero, the application process was pretty extensive. It involved a phone call with Divya or one of the other co-founders to check you out and make sure you weren't just some wannabe, that you actually worked at an investment fund.

I actually think was critical early on to make sure the membership base was high quality and acted as a self-reinforcing mechanism to continue to attract good members.

A better read: Psychology of Intelligence Analysis

by Richards J. Heuer, Jr.

https://www.cia.gov/library/center-for-the-study-of-intellig...

This volume pulls together and republishes, with some editing, updating, and additions, articles written during 1978-86 for internal use within the CIA Directorate of Intelligence. The information is relatively timeless and still relevant to the never-ending quest for better analysis. The articles are based on reviewing cognitive psychology literature concerning how people process information to make judgments on incomplete and ambiguous information. Richard Heur has selected the experiments and findings that seem most relevant to intelligence analysis and most in need of communication to intelligence analysts. He then translates the technical reports into language that intelligence analysts can understand and interpreted the relevance of these findings to the problems intelligence analysts face.

On the public company side board ownership of stock is often trivial

http://www.icahnreport.com/report/2008/06/about-ceos.html Icahn on CEOs:

"The way CEOs become CEOs in America is a travesty. This is one of our major problems. I use the anti - Darwinian metaphor. The survival of the unfittest.

If you remember if you were in college the fraternity president was always there for you. When you had nothing to do or when you were a little depressed. Feeling down. You go to the club and the fraternity president would always be there. You wondered when he had time to study which he probably didn’t do very much of in school. He was there to sympathize with you if your girlfriend didn’t show up or didn’t call you back and you obviously sort of liked the guy because the fraternity president was usually a likeable guy.

When the elections came up you would always vote for him. He had a couple qualities - the fraternity president. Politically, he was a survivor and he never made many waves. He did not promote controversy. Therefore when he went out into corporate America he was able to move up the ladder fairly quickly. Remember he survived, he didn’t make waves, and he wasn’t a threat. He kept moving up and up.

Eventually he becomes the assistant to the CEO. The CEO had the same qualities. He’s a survivor. He’d never employ anyone underneath him who might be a threat. The boards like these guys… this type of CEO. The boards generally don’t own any stock (another problem with our system). The boards don’t really care to hold CEOs accountable. Remember it’s a symbiotic relationship. These guys pay the boards very well – they give the boards perks. The boards don’t care to hold them accountable because that might endanger the perks they love so much.

When the CEO retires the assistant becomes the CEO. And remember what I told you. He’s a survivor. He would never have anyone underneath him as his assistant that’s brighter than he is because that might constitute a threat. So therefore, with many exceptions, we have CEOs becoming dumber and dumber and dumber. We can all see where this is going. It would almost be funny if it wasn’t such a threat to our ability to compete and to our economy in general."

Why would it be a good thing for the Middle Class to participate in IPOs which are typically skewed against them? The IPO process is one in which you're usually buying into a company whose price has been bid up considerably (these are "Growth" stocks).

I think it's been proven that investors aren't adequately compensated for taking on "growth" risk. The risk premia attached to "growth" doesn't outperform passively owning the index over long periods of time.

Seems like all A16Z is trying to do is juice the IPO market for more liquidity (from dumb money middle class investors) so that they can have an easier time exiting when they're ready.

This might be an unpopular view, but here goes -

All of these efforts to create valuable journalists will probably fail. The fact is, the business side of news has a lot going against it. The current newspaper model just isn't very viable because ad spending in newspapers continues to go down and page views can't mitigate the decline enough. Subscriptions help, but those dollars tend to flock to really important publications which offer some kind of differentiate product to an affluent client base. E.g.: the WSJ serves the business community and businesses will continue to pay for it.

That's very different from something like the Boston Globe, which doesn't offer enough value. Sure, there's local reporting, but I have a feeling that people don't care as much as you'd hope about that and as a result wont be willing to pay up for subscriptions.

You can learn programming and R to do some data viz, but it's not going to be enough to counteract the secular decline you're facing as capital exits the industry.

Honestly, I think journalism and being a journalist will be a career that eventually goes to rich people / people with other income sources than their primary job. Those are going to be the only kinds of people who can afford working for long hours and really low pay and gradually working their way up during school and afterwards with unpaid internships.

Your argument is pretty flawed. On an ev/ ebitda basis zip car traded close to rental peers pre acquisition, 12x for zip versus 10x for Avis which had a mature business. Zip spends 25% of sales on capex which inflates D&A making net income superficially low and the pe appear ultra high

Options Volatility by Natenberg is much better:

http://www.amazon.com/Option-Volatility-Pricing-Strategies-T...

You have to consider the risk/illiquidity that's taken on to achieve that return.

It's my understanding that VC works in a manner similar to PE, where investors are given their returns when the entire fund they invest in is run down. Each fund has a vintage, so if you invest in the 2006 fund you might get paid back 7 years from then in 2013, that's kind of a long time.

For a liquid asset class to compare to, equities have done something like 6-6.5% real historically.

I don't think Fred's investors want to be sinking money in renewable energy. If you look at the returns to that asset class, they've been pretty bad.

It's great to do big things and change the world, but the pension funds backing Fred want to earn a good return.

Direct link to article: http://www.newyorker.com/online/blogs/newsdesk/2012/06/atul-...

Does it really matter if you have a 1% or 3% rate on your bank account? At the end of it, because of the inflation rate, you still have a negative real rate for deposits which would promote investing elsewhere (like apartments).

I don't see anywhere where he said everyone was speculating on property as a savings mechanism. Obviously some parts of China are very poor. The fact remains though that people are choosing to speculate in property, which is logical given the negative real rates in China.