Like many people, I’m currently deep in SPACland. I’ve been writing privately about it a lot but have now crossed over into a zone where I feel like writing more publicly about it.

When Jason and I wrote the first edition Venture Deals in 2011, we built off a series of 30+ blog posts we wrote in 2005 about Term Sheets. It’s fun to explore them for historical reference since Jack Bauer plays a major part in the posts.

While these posts were the seed for what is now a book (Venture Deals: Be Smarter Than Your Lawyer And Venture Capitalist), it was also a way for us to think through all the elements of a VC financing, back at a time when there was enormous opacity about how these worked, along with massive information asymmetry between people who did them all the time (e.g., us) and the entrepreneur, who did a few of these over her lifetime.

While the web is a much noisier place in 2021 than it was in 2005, the opacity and information asymmetry around SPACs are remarkably similar to what existed 16 years ago around venture deals.

The cliche “everyone’s an expert, but no one knows anything” applies. Yes, there are some experts, but not that many. And the amount of misinformation, misperception, opacity, and information asymmetry is enormous.

As I continue to write privately, I’m going to start writing more publicly. And I encourage comments, feedback, and corrections.

While there is much debate about SPACs, I believe they are a long-term part of the capital stack. They are evolving rapidly, which is part of what is so interesting about them, at least to me.

The post Writing about SPACs appeared first on Feld Thoughts.

I've spent some time on Roblox. My reason is simple. I have a 10 year old son, and he likes loves it (second only to Minecraft). 

I'll be honest. I do not like the games on Roblox. I find them formulaic and repetitive. Many of them also have what's called "the grind" where you have to mindlessly click on something in order to make some arbitrary number go up (see: Lifting Simulator for an example).

But, like many others, I bought Roblox shares, now that the company is public. 

My reason is simple: Roblox is not just a gaming "platform" (there are many of those out there), but because:

Roblox is a low-code game development platform for citizen developers.

I'm a big fan of low-code platforms that allow mere mortals to do things that previously required "real developers". I'm the co-founder/CTO of HubSpot and we're big believers in making it easy for people to automate processes across marketing/sales/service.  And I would have invested in Zapier (Hi, Wade!) or Airtable (Hi Howie!) if they would have let me, but they didn't. No hard feelings though. OK, maybe just a little bit. ????

Anyways, back to Roblox. 

They created a multi-platform game development environment called "Roblox Studio". Looks something like this:

This development environment is pretty well done -- and it's a non-trivial thing to build. I wish they hadn't picked Lua as the default language, and instead gone with something like Javascript or Python. Some might argue that Lua is a simpler language, but I disagree.  In any case, it's impressive the level of control you have. 

In any case, they've made it possible for people to create games -- which they have done -- by the thousands. Are the games great?  No. But, could they one day be great? Yes. And if they pull that off, Roblox could be a Very Big Deal.

The lesson for software startups: See if you can figure out ways where it's not just you trying to create value for your users/customers. Make it such that *others* can create value too. That's where the really big opportunities are.  Case in point: At HubSpot, we just learned (from IDC) that the HubSpot ecosystem is predicted to grow faster than HubSpot itself -- from $4.8 billion in 2020 to $12.5 billion in 2024.

Real platforms are when the value you help others unlock externally is more than the value you create internally. 

$avvy, the latest movie that Amy and I helped underwrite, is now out. It’s another movie from Robin Hauser and Finish Line Features.

$avvy investigates the historical, cultural, and societal norms around women and money. This documentary questions why women often take a backseat to their finances. Interviews with business and financial experts like Carrie Schwab, Farnoosh Torabi, Sallie Krawcheck, and Haley Sacks (aka Mrs. Dow Jones) show why it is so important—now more than ever—for women to take control of their financial futures.

The first screening of $avvy is at the Santa Barbara International Film Festival from March 31st to April 10th.

Sign up here to register to watch $avvy.

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Every company wants great relationships with its customers. The question what does it take to truly turn your connection with customers into a superpower?

Let's start very simply.

The most obvious (and most common) way to deepen a customer relationship is to ask for customer feedback so that you can improve your product. You do NPS (Net Promoter Score) surveys. You set up focus groups. You conduct user testing. You try to identify bugs. You try to collect, categorize and prioritize new feature requests. All good things to do. If you’re not doing those things, you should start. It’s good, clean living.

Next, there’s an even better thing to do. Don’t just get feedback on your product, get feedback on  your entire customer experience. What’s it like evaluating your product before buying? Was it easy to figure out pricing? Was a conversation with a sales person necessary? If so, was that conversation enjoyable or dreadful? What do customers think about the invoice emails they get from you? Are they clear? How do they feel about your support? Is your sales team helpful or aggressive when looking to upsell existing customers? Is your experience good enough that when the customer changes jobs, they take you with them to their new gig? If you’re not collecting feedback and seeking answers to these kinds of questions, you should start. It’s better, cleaner living.

Once you start getting good at this kind of customer feedback, there’s one more level to achieve. And, it’s not about “collecting feedback”. The inherent limitation with collecting customer feedback is that it’s all about you. How your product can get better. How your business can get better. Nothing wrong with your goal being to make your business better. That is a fine, understandable goal to have.

But, in order to truly build that deeper connection and understanding, it can't be about you. Not directly.

The next level is going beyond collecting customer feedback and connecting to a customer's hopes, dreams and fears. Remember, customers are people too.  How is your customer doing? Are they OK? What’s work been like? What’s life been like? What problems are they trying to solve? What is keeping them up at night?

Now, you might have this question in your head:

“Dharmesh, this is all well and good, but how is all that relevant to my business?”

It may or may not be relevant to your business. But I guarantee you it’s relevant to the customer. And they are relevant to your business.

You may find that response a tad too abstract and not sufficiently satisfying.

So, let me expand on it.

Let’s say you’re looking to spot new market trends before others. Find new adjacencies to expand your offering. Identify an acute market need. The best way to do these kinds of things is to understand your customers. Like, really understand them and what’s going on in their lives.

The ability to deeply connect with customers in this way is a super power.  

Does it scale? No. But, it doesn’t need to. Even if after a hundred conversations you uncover  just one transforming insight, it’s worth it. And you will. It’s just a matter of time.

At my company, HubSpot, we believe that we’re not just here to build software, we’re here to build careers. So, we really try to dig into the true needs of our customers. We ask ourselves not just what our software can do for them, but what our company can do for them. That mindset has served us well -- and I think it would work for you too.

My first full day in isolation was one year ago. My last dinner out was on Tuesday, March 10, 2020, with Mike Platt. I remember driving home that night pondering when I’d be back in the office.

On Wednesday, March 11, 2020, I had a full schedule at home, starting at 9 am and ending at 5:45 pm. Little did I know that would be the pattern for at least a year.

Amy and I each had a long day yesterday, so we spend the evening having “morning coffee #2 without the coffee.” It was an emotional reflection on a year with a vast range of positives and negatives for both of us.

By far, the biggest positive has been spending 365 days together. We spent the first 25 years of our relationship apart more than 75% of the time as I traveled constantly. To spend 365 days together, waking up and having coffee each morning, and saying goodnight in person each night, has been amazing.

As we both look forward, we are talking a lot about what we’ve learned from the last year – both good and bad. It sets the table for how we want to live the rest of our lives, however long that may be.

Amy shared an article from The Atlantic titled We Have to Grieve Our Last Good Days, which impacted me. I encourage you to read it and ponder as you reflect on the anniversary of the start of the Covid crisis in the US.

The post One Year Ago Today appeared first on Feld Thoughts.

Last summer, I shifted my personal behavior around racism. I realized that I had spent the previous 20 years providing “passive” support to social justice causes. I decided that I’d spend the next 20 years actively helping to eliminate racism in America. That includes learning, doing, supporting, and being an accomplice.

At the end of last week, two articles written by CEOs in our portfolio made the rounds on our CEO list.

This first is from Xiao Wang, the CEO of Boundless. The article is an NBC OpEd titled Violence against Asian Americans means we must fight for ourselves, not just pursue success. It’s extraordinary (as is Xiao) and includes a gem in the middle of it.

For too long we’ve been passive observers, reveling in how much better America is compared to where we or our ancestors have come from, instead of actively shaping how good America could be.

Xiao’s son just turned one year old. He ends his OpEd with:

And, yes, I will make my son do his math homework and learn how to play piano, but I will also teach him how to be proud of who he is. He doesn’t need to be ashamed about the size of his head, his face flushing after a beer or his last name. I want him to grow up in an America that will treat him equally as a U.S. citizen, and not one where he will be asked “But where are you really from?”

But if they do, I want him to be sure of himself when he says, “The United States. Just like you.

The next is by Craig Lewis, CEO of Gig Wage. It’s an article on TechCrunch titled Investors are missing out on Black founders. It’s broken up into the following sections.

Black founders need to own their resiliency and leverage the power that has resulted from their unique experiences. The victory mentality that ensues thereafter is the type of mindset that venture capitalists should want to invest in, and if they do not, they are undoubtedly missing out.

I’m glad I get to work with, learn from, and support Xiao and Craig.

The post Helping to Eliminate Racism in America appeared first on Feld Thoughts.

The Techstars Foundation recently announced a new program called Accelerate Equity.

We created the Techstars Foundation in 2015 to help make innovation and entrepreneurship more accessible and inclusive. Since then, the Techstars Foundation has been investing in and accelerating nonprofits that deliver scalable impact for underestimated entrepreneurs.

Through Accelerate Equity, the Techstars Foundation identifies early-stage nonprofits and ideas to empower and support underestimated entrepreneurs. Each non-profit has a significant nominating donor. We then call on the Techstars network to pitch in, provide mentorship, and add additional financial donations. The Techstars Foundation will add a 5% match to the total raised at the end of the calendar quarter.

Amy and I helped get this program started by nominating and underwriting initial grants to Grid 110, Sistahbiz, and HBCUvc. The Techstars Foundation added Knox St. Studios to the list.

If you are interested in supporting any of these organizations, please click on the respective link above or reach out to the Techstars Foundation. Or, for the three I’m involved in, drop me an email also, and I’ll make an appropriate connection.

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At 7:52, I was upstairs having coffee with Amy. It’s a new routine that we started at the beginning of Covid. Every morning we have coffee together. Long-time readers of this blog or our book Startup Life: Surviving and Thriving in a Relationship with an Entrepreneur will recognize this as the evolution of our daily “Four Minutes in the Morning” ritual.

“Morning coffee” lasts about 30 minutes. We each make a cup of coffee in our magical Nespresso machine. Mine is simple – put a random capsule in and press the button. Amy’s is more elaborate since it involves milk, a microwave, sugar, and the Nespresso machine. We then sit together in the living room and talk about how we slept, our Whoop recovery scores, and what is to come for the day ahead. That’s the four-minute part. We then let the conversation take us wherever it goes. The last few days, we’ve talked about octopuses, the Nature Conservancy, a Zen garden we are designing, tents, the dog next door who barks hello to us, winter turning into spring, summer adventures, estate planning, friends who just had a great exit for their business, and knitting.

When I finish my first cup of coffee, I make an exaggerated “grunt.” This is a new part of the ritual that makes us both laugh. Amy loves to do acts of service, and making my second cup of coffee (decaf) during our morning coffee ritual is a daily one that makes both of us smile.

After I finish my second cup of coffee, we get up, hug for eight seconds, and then I go to the office. Which, in this case, is a 15-second commute downstairs from our living room.

This used to be a 30-minute drive from my house to my office in downtown Boulder. We’ve repurposed this 30-minute drive into our morning coffee. Not surprisingly, I enjoy our 30 minutes together a lot more than I enjoyed my 30-minute drive to the office.

So, at 7:53 this morning, I was in my office, at my desk. While I’ve worked from home part-time for 30 years, I’ve never had a continuous rhythm of this. It’s been almost a year where I’ve done this every day. My last day in an office was March 10th, 2020. My last dinner out for business was at Jaipur in Boulder with Mike Platt that night. It wasn’t really a business dinner since we talked about life and our anxiety about this new thing called Coronavirus.

While many people want to get back to an office, I don’t. I’ve found a much better rhythm. While it took a 120-nanometer virus to reinforce it for me, I embrace it.

The post The 15 Second Commute appeared first on Feld Thoughts.

After my blog post Book: The Soul of an Octopus I received a flurry of emails telling me I needed to watch the movie My Octopus Teacher on Netflix.

I watched it last night and it was beautiful.

I’m fascinated by which blog posts generate email responses. Sometimes is zero. Sometimes it is a lot. This one was a lot.

Octopuses are crazy interesting. And Craig Foster is pretty awesome.

Thanks everyone for the email with the recommendation.

The post Movie: My Octopus Teacher appeared first on Feld Thoughts.

My favorite animal is a polar bear.

For some reason, I have always related to polar bears. When I’m reincarnated, I hope I come back as a polar bear.

I’ve always like octopuses but never thought much about why. After reading Sy Montgomery’s incredible book The Soul of an Octopus: A Surprising Exploration Into the Wonder of Consciousness, I now know why. It’s simple – we don’t understand how they think.

While a quick throwaway thought is, “Brad, we don’t really know how animals think” or some other assertion around that, there’s such an enormous gap between this question when applied to a dog versus an octopus. This lives in Sy’s subtitle: “A Surprising Exploration Into the Wonder of Consciousness.”

I read the book over a week and had several incredibly complicated dreams, especially around processing stimuli. I had magic superpowers in my hands, arms, legs, and feet in one of them. I remember waking up thinking, “that would be so cool.” And then the dream slipped away.

One of my favorite movies of the last decade is Arrival. We’ve watched it a few times, and I think I’ll watch it again.

Time and language play key roles in the film. As humans, we have a very linear view of time and a constrained view of language. Sci-fi plays with time a lot, and Arrival plays with both time and language.

That leads me back to octopuses. Humans often anthropomorphize everything, where we apply our concept of time and language to other species. As I read The Soul of an Octopus, I kept flashing back to Arrival. The book itself is linear through time, but the octopuses in the book don’t feel like they are necessarily operating in a time-linear fashion. The protagonist (the author Sy) hints at this but doesn’t fully embrace it. I wonder what she would have written differently if she approached the experiences she had with octopuses as ones where the octopuses weren’t experiencing things in a time-linear fashion.

Sy embraced the difference in language processing more fully. The octopus brain has around 500 million neurons (similar to a dog) – the most of any invertebrate. However, two-thirds are in their arms. The eight arms appear to process information independently of each other, resulting in octopuses being incredible multi-taskers. Their non-verbal communication has many levels, and they seem to be taking input simultaneously in multiple dimensions.

Combining this with non-linear time is fascinating to me. Other than sci-fi, the only other non-linear time entity I consciously engage with is a computer. It also uses a different approach to language.

And then the rabbit hole gets deep, twisty, and really fun.

Octopuses are now my second favorite animal.

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Amy and I have coffee for about 30 minutes every morning. It’s been one of the wonderful positive side effects of the Covid crisis.

Some days we land on a topic. Other days we don’t. Today, after a few minutes, the question “What is your worldview?” popped up, and we bashed that around for a little while.

The last year has had an enormous impact on my personal worldview. My underlying value system and beliefs haven’t changed, but I’ve reconsidered, rethought, adjusted, and modified many external perspectives. But that’s the easy stuff.

Amy said something this morning that caused me to jump out of my skin with delight.

“You have always been the weird kid in the corner with a big book.”

At the moment she said this, we were discussing how we understood others and how others understood or misunderstood us.

My internal perspective is unchanged, but in the last year, it has surfaced much more clearly. About four years ago, Jerry Colonna and I had a conversation described in his book Reboot: Leadership and the Art of Growing Up where I said, “I’m no longer striving.”

I didn’t completely understand what I meant by this back then, but it was the beginning of me bending the arc on my internal worldview. Jerry linked it to equanimity, which has deep roots in Buddhist thought in addition to its traditional definition.

In Buddhism, equanimity (Pali: upekkhā; Sanskrit: upekṣā) is one of the four sublime attitudes and is considered: Neither a thought nor an emotion, it is rather the steady conscious realization of reality’s transience. It is the ground for wisdom and freedom and the protector of compassion and love.

I’ve anchored on the phrase the steady conscious realization of reality’s transience which speaks to me and feels reflective of my current internal worldview.

The post What Is Your Worldview? appeared first on Feld Thoughts.

Amy and I just underwrote one-year memberships to the Boulder Chamber of Commerce for 62 Black-owned businesses in Boulder.

Last summer, Aaron Clark started putting together a list of Black-owned Businesses in Boulder. The current list is at 62.

A few weeks ago, John Tayer at the Boulder Chamber mentioned an initiative he was working on with Aaron to get discounted memberships to all 62 companies. The Boulder Chamber is a long-standing and important part of the Boulder business community, and John has been a great leader for many years.

In an attempt to eliminate any friction associated with a decision for these 62 businesses to join the Boulder Chamber, Amy and I decided to underwrite their memberships for a year. I hope that all 62 will join, and the overall Boulder business community will engage deeply with and support these business owners.

I appreciate Aaron and John’s leadership enormously. I’ve gotten to know and work with Aaron on several initiatives over the past nine months, including participating in an equity learning initiative led by his firm Equity Solutions, supporting Justice Reskill, and experiencing a lot of equity activity Aaron has lead for Energize Colorado.

John recently did one of his Chamber Chats with Aaron. It’s a great overview of some of the work Aaron is doing, along with a discussion of Black History Month.

If you’d like an intro to Aaron or John, just email me.

The post Boulder Chamber Memberships for Black-Owned Businesses appeared first on Feld Thoughts.

The only time I go outside right now is to go running. I had an awesome run in the dark at 5:30am today in 10 degrees. There were only two cars that passed me and one person near the end of my run walking his dog.

As Amy and I sit in our office in Aspen and grind away, we are blessed with a magical view.

A few moments ago, my EA Annie sent me a link to WindowSwap. It’s a treasure. I felt like hanging out in Ukraine for a bit, so off I went.

Each video is 10 minutes long with sounds, so on a big monitor, it feels pretty close to looking out the window.

The post WindowSwap – Travel Around The World From Home appeared first on Feld Thoughts.

A few minutes ago, Amy sent me this to ponder as we head into the weekend after an intense week.

Find meaning. Distinguish melancholy from sadness. Go out for a walk. It doesn’t have to be a romantic walk in the park, spring at its most spectacular moment, flowers and smells and outstanding poetical imagery smoothly transferring you into another world. It doesn’t have to be a walk during which you’ll have multiple life epiphanies and discover meanings no other brain ever managed to encounter. Do not be afraid of spending quality time by yourself. Find meaning or don’t find meaning but “steal” some time and give it freely and exclusively to your own self. Opt for privacy and solitude. That doesn’t make you antisocial or cause you to reject the rest of the world. But you need to breathe. And you need to be.

 – Albert Camus
Notebooks, 1951-1959

I’ve been spending a lot of time with Nietzsche lately. I expect I’ll be adding some Camus to my diet.

The post Finding Meaning appeared first on Feld Thoughts.

I haven’t been posting about my reading lately. While I continue to read at my typical pace, I think I was a little tired of writing book reports, but that has passed.

Last night I read The 80/80 Marriage: A New Model for a Happier, Stronger Relationship. Kaley and Nate Klemp have written an excellent book that can help any married couple improve their relationship. This is especially true in the time of Covid, given all the additional dynamics about being home together most of the time.

When Amy and I wrote Startup Life: Surviving and Thriving in a Relationship with an Entrepreneur in 2013, our goal was to write something different than YARB (“yet another relationship book”). Whenever I worked on it, I had in my mind, “Do not let this be a YARB.”

The 80/80 Marriage is definitely NOT a YARB. The framework comes from the idea that many marriages are 80/20 with a goal of shifting to 50/50, where the partners are equal in the relationship. Kaley and Nate’s goal is to do better than 50/50, hence 80/80.

Amy and I have had an equal partnership in our marriage from the beginning. However, as any married couple knows, that ebbs and flows and at times doesn’t feel equal. The two of us talk about it often, and when we get out of balance on any dimension, we both own what is going on, discuss what we need to do to get back in balance, and then move forward.

Once you start deconstructing this, many traditional relationship tools fit nicely in the 80/80 Marriage construct. Amy and I are big fans of the Five Love Languages. I like receiving acts of service, she likes receiving praise, and both of our #1 is quality time. We also like giving what we like receiving, and fortunately, we both like receiving acts of service and being together all the time.

But what if instead of each person being at 50% of the relationship, the goal was to exceed expectations? That’s where the 80% comes from. An example would be from this morning. Amy is a huge knitter and has been wrestling with a giant yarn tangle. Rather than throw it away, she spent some time last night unsuccessfully trying to untangle it. Today, while she was on a board call and I was upstairs, I spend 10 minutes and untangled it. When she came upstairs, she was delighted with the minor act of service that she didn’t ask for.

There are hundreds of things like this we do for each other each month. Some are significant. Some are trivial. But they are all unexpected and unrequested. That’s what pushes the 50% up to 80%.

Kaley and Nate cover all aspects of a relationship, including roles, priorities, boundaries, power, and sex. And, they finish with the 5 essential habits of the 80/80 marriage:

This felt great to me, as Amy and I have regular approaches for each of these. Our Qx vacation approach is highlighted in the book as an example of #1. My yarn story above is an example of #2. Our Life Dinner is how we practice #3, although we do it in real-time also. Morning coffee and Life Dinner is #4, along with shared meals (typically lunch in the time of Covid.) And our Qx vacations and Digital Sabbaths are #5. Of course, what we do is more than just labeling the activity, but if you read our book or follow along on this blog, you can probably related to some of the examples I’ve given in the past.

Kaley and Nate Klemp have made a significant contribution with The 80/80 Marriage: A New Model for a Happier, Stronger Relationship and written something that is not-YARG.

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We are running the Venture Deals Online Course from March 7, 2021 – April 30, 2021.

We’ve moved the Venture Deals Community from Slack to Mighty Networks where we have much more functionality and flexibility.

Once again, we’ll do a weekly AMA with a variety of people participating.

For now, registration is open. Please sign up if you want to take the Spring 2021 Venture Deals Online Course.

The post Venture Deals Online Course – Spring 2021 Edition appeared first on Feld Thoughts.

I used to love the Matrix’s Red Pill / Blue Pill metaphor and still use it occasionally to try to make a point around dealing with reality in an entrepreneurial context. Several years ago, I became deeply bummed out about how this metaphor was being used in politics and gender equity situations. It’s gotten worse since then, and I find many of the cases it is used in and the people who use it reprehensible, so I don’t use it much anymore.

However, I used it today for a company that is doing well and has exceptional strengths and some fundamental weaknesses.

This is true of every company that is doing well.

But it’s hard to deal with reality all the time. When things are going well, leaders (and boards) often avoid dealing with weaknesses. Some board members and investors are great at motivating a CEO to level things up. Others aren’t. Some CEOs want to embrace the challenge of leveling up in areas where they, and the business, are fundamentally weak, even if it’s emotionally and functionally challenging. Others don’t, or their own behavior and wiring get in their way.

There are many points in a company’s life where the CEO and the board can either deal with or deny reality. When dealing with reality, a key factor is embracing the business, team, and individual’s weaknesses and then deciding how to address them. Collectively. With empathy and emotional support for each other.

This isn’t easy. Over the past 30 years, I’ve been in this position many times, often multiple times as a board member in a particular company. These are different than crisis moments, where everything is on the line. It’s often when many things are going well, but there are prominent areas of the business that aren’t keeping up with what’s working.

I’ve never figured out magic words to say as a board member in these moments. Instead, I say what is on my mind, take responsibility for my participation in any weaknesses, dysfunction, or challenges, and focus on where I think we need to put additional energy in improving the business.

This is often an acknowledgment that we need to add a few experienced people to the leadership team. The CEO has to drive this. When the right people are added, notable positive shifts in the weaknesses can happen extremely quickly. But, in the absence of them, the talk generally continues, without action. Reality is not dealt with – just poked around the edges.

One of an effective board’s roles is to speak clearly about the weaknesses and hold the CEO accountable for addressing them. When I am effective as a board member, I do this well. When I’m not, I don’t. I’ve got plenty of cases of both in the last 30 years.

My mantra as a board member is:

“As long as I support the CEO I work for her. If I don’t support her, my job is to do something about that, which is not to replace her, but to try to get back to the place where I support her.”

Ultimately, as a board member and major investor, I can participate in replacing the CEO. While I’d prefer not to do that, I’m not afraid of doing it. But dealing with reality with the existing CEO is much more enjoyable and has generally been a more successful path for me.

All of this is extremely challenging, as it has to do with personal growth in the context of business growth. It’s easier to have entrenched thinking, play out the exact historical patterns that worked or be resistant to addressing whatever the current reality is. It’s compounded by the fact that exogenous factors are constantly changing and often change extremely fast.

The probability of long term success increases with a CEO, a board, and a leadership team is tuned into whatever the current reality is, their strengths and weaknesses, and focus on continually leveling up the weaknesses while continuing to play to their strengths.

If you are a CEO, spend a few minutes today contemplating whether your board is highly effective at helping you grow, scale, and evolve the business. Are you systematically and continuously addressing your weaknesses as an individual, leadership team, and company?

Are you dealing with reality?

The post Dealing with Reality in Business appeared first on Feld Thoughts.

On my run yesterday, I listened to Tim Ferriss interview Naval Ravikant on Happiness, Reducing Anxiety, Crypto Stablecoins, and Crypto Strategy.

I know both Tim and Naval. I have a mostly virtual relationship with each of them (I think I’ve been in the same physical space with Tim twice and never with Naval), but they are two people I’ve learned a lot from over the past decade.

When I run, I listen to one of four things.

I go through phases, and I’m in a Podcast / Audible phase. I’m a little bored of Diamond Age (I’m halfway through in a slow spot), so I fired up a random Tim Ferriss podcast. I noticed he’d done one recently with Naval, so that was it.

The crypto stuff was good, but I was much more intrigued by everything else. I’m a big fan of Richard Feynman, so when Naval started rolling out Feynman quotes, he had me. There was a ton of wonderful in the back and forth between Tim and Naval, and when Naval got on a roll on a topic, the running just vanished into the background.

A fun sleeper idea in the middle of things was that Naval, who has over a million followers, doesn’t follow anyone on Twitter. I only use Twitter to broadcast things these days, so I think I’ll try that hack for a while and see if it works.

I haven’t been blogging much lately – on purpose. I’ve been trying to reset a few things in my writing and decided to go inward for a few months, starting around my birthday. I believe the reset has happened and listening to Naval and Tim helped reinforce a few things I’ve been playing around with now that I’m 55 years old.

Tim / Naval – thanks. I enjoyed listening to y’all.

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I expect we’ll be exploring, unscrambling, pontificating, and dealing with what is happening with GameStop (GME) for a while.

If you are reading this in the future and want some historical context for the rest of this post, this chart from the last 30 days of trading is instructive. At the end of 2020, we start at $20 / share.

30 days later, it’s at $238 / share with a high of $482 / share.

I’m not going to analyze this. I know what I think GME is worth, and it’s not $238 / share.

This morning, Fred Wilson wrote a post titled The Revenge Of Retail. It’s got a lot of good stuff in it, but plenty of things that are very different than what I’m actually thinking about today.

He ends with a recommendation.

What we need to do is stop printing money to stabilize the economy. And start addressing the real economic issues that exist on main street, not wall street. Monetary policy is not the answer. Fiscal policy is. That won’t stop more Game Stops from happening. They are a by-product of markets. But it will get the money to where it is needed versus where it is just gameplay.

I’m more interested in the 2nd, 3rd, and 4th order effects instead of the financial and market dynamics. For example, from Fred’s post.

The generational aspect of this is important. Boomer hedgies getting crushed by young folks self-organizing in social media. It feels like a moment where you realize that the power structure has shifted and things won’t be the same.

But hang on. Is that actually what is happening? Let’s go to something Fred says in his next paragraph.

The financial system in the US, and in other developed countries, is a rigged system and has been for a very long time. Only big institutions can get into hot IPOs. Only rich people can invest in startups. Many of these rules are designed to protect “widows and orphans” but all they really do is make the rich richer and keep those without money out of the game.

Rather than keep quoting Fred, I encourage you to go read The Revenge Of Retail post and then come back to the rest of what is on my mind this morning.

When I was an undergraduate in college (age 17 – 21; 1983-1987), I was interested in business and read three magazines: Forbes, Businessweek, and Fortune. I learned about the stock market by reading those magazines. That period was full of pump and dump schemes, especially on the pink sheets.

There have been periodic articles about the pump and dump activity in crypto. With the introduction of frictionless (e.g., free trading), a coordinated online crowd of millions of people, and low float stock (either highly shorted or not much supply in the first place), the setup for a classic pump and dump exists.

The regulatory environment has no capacity to keep up with something like this.

A combination of factors has created an environment where completely different behavior is possible. Today’s news is that it is happening in the financial markets. We may be talking about it here because we are now on the other side of 1/20/21; our prior President is no longer on Twitter and Facebook, so there’s a new sandbox to play in.

The dynamics are the same. Sentiment is manipulated. There have been endless discussions about this around politics over the past few years. Welcome to another part of our world (financial markets), where the unintended consequences of technology wreak havoc.

I expect we will see many more and many different examples emerge over the next few years. Governments trying to regulate it each time will be slow, and all will fail to do what they want to do while creating other unintended consequences.

We are living in a complex system. Technology has increased the velocity of change. It’s recursive, as the velocity of technology is changing faster than ever.

I have no idea what’s next. That’s the reality of a complex system. All I know is that it is going to get much wilder.

And, the best picture of the day is linked to a txt thread I’m on with Amy (we both love Capybaras) that includes the phrase “PhD in the madness of crowds.”

Minor change: I initially titled this “The Gamestop Phenomenon.” That’s a nice error on my part (freudian slip maybe)?

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The Covid crisis has generated an extraordinary amount of what I like to call “false reassurance.”

Consider how many times you heard something general like the following some time in 2020.

Or, consider all of the messages you heard about the severity of the disease over the past year. Most of the messaging, until recently, was not “79,000 people in the US are going to die of Covid in the first 26 days of 2021.”

Or, “By the end of January 2021, over 425,000 people in the US will have died of Covid.”

It’s tough to focus on what is actually happening and what to do when bombarded by false reassurance. It doesn’t matter what the context is – Covid, business, relationships, health, sports, …

Pema Chödrön’s book, When Things Fall Apart: Heart Advice for Difficult Times is a powerful place to start when considering false reassurance. But, an even more grounding place is Jerry Colonna’s comment that “things are falling apart all the time.”

I’ve always loved the clichés about mortality, such as “Life is a fatal disease” or “Life is a process of continual oxidation.” I’m sure the physics majors out there can add to the clichés, especially since entropy always wins in the long run.

Amy and I work hard to eliminate false reassurance in our life. Instead of saying, “It’s going to be ok,” we try to address what is in front of us. Instead of denying reality, we deal with it. I try to do this in my work, although it’s much harder as the number of people in a system increase beyond two.

2020 has been brutal for many people, on many different dimensions. I expect 2021 will continue to be brutal, in some similar ways, but many that are different. There will be wonderful things mixed in, but they won’t be distributed evenly or equitably.

If you defer your own reality because of false reassurances, consider what would change if you deleted the false reassurance and started considering what was directly in front of you.

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