Weekend Briefing No. 358
Welcome to the weekend.
Did your brilliant friend forward this to you? Subscribe here.
900—What started as a random act of kindness from one man paying for the car behind him in a Dairy Queen drive-thru resulted in over 900 cars also taking part in the pay it forward chain.
50—Facebook has acquired 86 companies since its founding, their properties account for 75 percent of time spent on social networks and they control 50 percent of display ad space online.
2—A Chinese team tested a jet engine that flies nine times the speed of sound and is able to reach anywhere on Earth within 2 hours.
Pipe, a marketplace for revenue-based lending, has started to let its employees sell some of their equity each year through company-managed secondary sales on the AngelList platform. Shareholder liquidity continues to be a challenge for tech startups as companies remain private longer than ever before. Pipe CEO Harry Hurst says: “I just have this fundamental belief that the way the system is set up isn’t friendly for employees. It isn’t set up for team members of tech companies to win along the way. If you expect someone to give you five, six, seven, even a decade of their life, people are going to have life events happen—having [equity] on paper doesn’t actually help you.” Pipe is now orchestrating annual secondary sales, letting every employee sell some vested equity, no questions asked, says Hurst. The company's existing investors have become regular participants on the buyer side of these transactions. While Pipe itself hasn't used these sales to buy back some of its own equity, Hurst says it's entirely possible it may do that at some point. The bottom line: “We’ve seen the evolution of capital come in and position themselves as ‘founder friendly’—I think the next phase is for founders to be more ‘team friendly.’” Axios (5 minutes)
Sustainability and Accounting
Companies, investors and consumers alike are frustrated by a lack of standardized accounting for corporate ESG performance. This might be about to change, thanks to a recent proposal from the IFRS Foundation, which is the body that oversees the work of the International Accounting Standards Board (IASB) in setting financial reporting requirements for most companies in the world. If the proposal is adopted, investors and other stakeholders will suddenly have a much clearer view of a company’s sustainability performance—just as they do its financial performance. While most companies today issue sustainability reports, these are divorced from their financial reports, making it difficult to see the relationship between financial performance and sustainability performance. The proposal from IASM will make it possible for the ideal of integrated reporting to be realized. Harvard Business Review (11 minutes)
A private rocket-launch startup unveiled its fully autonomous drone designed to drop a rocket in midair that shoots small satellites into orbit without a launchpad. Alabama-based company Aevum rolled out its Ravn X Autonomous Launch Vehicle at the Cecil SpacePort launch facility in Jacksonville, Florida, on Thursday. The 80-foot aircraft has a wingspan of 60 feet, stands 18 feet tall and is the world’s largest Unmanned Aircraft System (UAS) by mass, weighing 55,000 pounds. The completely autonomous aircraft is 70 percent reusable with plans to be up to 95 percent reusable in the future. The craft flies just like a typical plane and can launch from any one-mile runway, doing away with the costly infrastructure that comes with a launchpad. Once the Ravn X reaches the proper location and altitude, it drops a rocket that launches a payload of about 220 pounds into low-Earth orbit. After delivering the payload, the aircraft lands and parks itself in a hanger. The company says the aircraft is designed to put satellites into space as fast as every 180 minutes. The Hill (6 minutes)
CRISPR and COVID
Scientists at UC Berkeley and Gladstone Institutes have developed a new CRISPR-based COVID-19 diagnostic test that, with the help of a smartphone camera, can provide a positive or negative result in 15 to 30 minutes. Unlike many other tests that are available, this test also gives an estimate of viral load, or the number of virus particles in a sample, which can help doctors monitor the progression of a COVID-19 infection and estimate how contagious a patient might be. The new diagnostic test takes advantage of the CRISPR Cas13 protein, which directly binds and cleaves RNA segments. This eliminates the DNA conversion and amplification steps, and greatly reduces the time needed to complete the analysis. Marginal Revolution (6 minutes)
The press had been following this production story for years. There was considerable excitement. Many speculated the Nano would become the most popular car in the second-most populated country in the world. Behind all of the initial hype was a good first wave of sales via 200,000 pre-orders. The Nano even won a slew of awards for its design, fuel efficiencies and weight. However, quite quickly, everything slumped precipitously from tens of thousands of units sold per month to mere hundreds. Tata’s marketing team positioned the Nano as the “cheapest car in the world” which, at face value, seems like a logical thing to do in a cost-sensitive market. But only a quick glance beneath the surface will tell you those five words were a massive blunder. While Indian consumers are indeed cost-conscious, there are powerful cultural factors that make the “cheapest car in the world” a repulsive slogan. Indian society has lots of pressure around class and status. For many buyers, to be seen owning “the cheapest car in the world” was to be seen as poor, which is a very sensitive word in India. Consumers with new money were eager to participate in conspicuous consumption (purchases that project achievement and status). In turn, they opted to spend a few extra bucks for slightly nicer cars with better reputations. The marketing position of the Nano was far more catastrophic than any of the fires that came before it. Ambitious middle-class Indians could deal with minor safety concerns but not the perception of being low-income. BetterMarketing (5 minutes)
Junior Bridgeman wasn’t a superstar, but with a career total of 11,500 points and almost 3,000 rebounds, he certainly wasn’t a slouch either. Playing 10 years with the Milwaukee Bucks and two years for the Los Angeles Clippers, Bridgeman excelled as the sixth man. Bridgeman, as a role player, earned no more than than $350,000 in a single season. This was enough to live comfortably but certainly not what you expect for an NBA player. Here’s where it gets interesting. In an effort to prepare himself for life after basketball, Bridgeman spent his offseason working at a local Wendy’s drive-through to learn the business model of fast food restaurants. While other players were taking advantage of offseason freedom, Bridgeman was putting in the time and essentially building his empire. By the time retirement came, Bridgeman had already purchased three Wendy’s. Over time, Bridgeman amassed a portfolio of 360 restaurants in 16 states but eventually set his sights on a bigger opportunity. In 2016, he sold his restaurant franchises. Coca Cola named him just the third new independent bottler to join the brand in recent decades, and granted Bridgeman exclusive operations that span most of Kansas, a significant portion of Missouri, a little over half of Illinois and a small part of Nebraska. The Coca Cola deal was a dream for Bridgeman, who had been fascinated with the business since his playing days and later went on to purchase additional bottling rights within Canada. All in, it’s estimated that Bridgeman has built up a net worth of over $600M—not bad for a role player. Huddle Up (9 minutes)
Useful and Overlooked Skills
Here’s a list of useful and overlooked skills: (1) Calibrating how much you wanting something to be true affects how true you think it is. The idea that rewards promote focus and skill is only true to a point; when the rewards get high enough, it spins the other direction because mental bandwidth that would otherwise go toward strategy and reason is overwhelmed by dreaming about the reward. (2) Respectfully interact with people you disagree with. The trick to opening your mind to those you disagree with is to find people whose views on one topic you respect—that checks the box in your head that says “this person isn’t totally crazy” —and debate them on the topics you disagree about. Without the first step, it’s too easy to write someone off before you’ve heard their full argument. (3) Diplomatically say “No.” A diplomatic “no” is when you’re clear about your feelings but empathetic to how the person on the receiving end might interpret those feelings. It’s critical in private investing like venture capital, where the pass rate on potential investments approaches 99 percent. Collaborative Fund (7 minutes)
Leadership by Doris Kearns-Goodwin. Doris Kearns Goodwin draws upon the four presidents she has studied most closely—Abraham Lincoln, Theodore Roosevelt, Franklin D. Roosevelt and Lyndon B. Johnson—to show how they recognized leadership qualities within themselves and were recognized as leaders by others. By looking back to their first entries into public life, we encounter them at a time when their paths were filled with confusion, fear and hope. Leadership tells the story of how they all collided with dramatic reversals that disrupted their lives and threatened to shatter forever their ambitions. Nonetheless, they all emerged fitted to confront the contours and dilemmas of their times. At their best, all four were guided by a sense of moral purpose. At moments of great challenge, they were able to summon their talents to enlarge the opportunities and lives of others. Does the leader make the times or do the times make the leader? Amazon
Most Read Last Week
The Year in Pictures—The photographs in this collection capture this historic year when more than 1.5 million people globally died during a pandemic, racial unrest gripped the world and democracy itself faced extraordinary tests.
Sales—With marketing professionals handling the art of grabbing customers’ attention and e-commerce turning sales into a series of clicks, what exactly is the sales industry all about in 2020?
Golden Handcuffs—Why don’t more engineers in Big Tech companies quit their jobs to pursue their dreams?
About the Weekend Briefing
Should We Work Together?
This newsletter is my passion project. I hope it helps you gain deeper insight and equips you to create meaningful impact in the world. Many readers have asked about how we can work together. In case you’re interested, I run a law firm for startups. We try to keep things simple by offering transparent flat fees. We structure our engagements in two ways: (1) Per-project flat fee engagements—No billable hour means no surprise legal bills. (2) General Counsel—A simple monthly fee for all your day-to-day legal needs. It’s like getting a subscription to your own general counsel. If you’re interested, let’s jump on a call to see if you’re a good fit for the firm. Click here to schedule a call.
Nature does not hurry, yet everything is accomplished. –Loazi
Did your brilliant friend forward this to you? Subscribe here.