56: My Thoughts on Sports, Buffett & Matt Rose, Interview with Nvidia CEO, E-Commerce & COVID19, Stripe, Microsoft’s Pluton Security Processor, and Space Art
56: My Thoughts on Sports, Buffett & Matt Rose, Interview with Nvidia CEO, E-Commerce & COVID19, Stripe, Microsoft’s Pluton Security Processor, and Space Art
"Now we can have computers write software."
A cynical student seeks an easy answer. A curious mind seeks a hard question.
The closest I’ve come to truly feeling what it is to be a sports fan was when I used to watch South-Korean professional Starcraft 2 leagues a few years ago (probably around 2013-2015? Not sure.. At the time it was on GomTV. I think today, a lot of the same crew can be found on this channel — I’ve heard so many hundreds of hours of commentary by “Artosis” and “Tasteless”, I feel like I know them, same as with some podcasters).
I knew all the teams, the players, the meta-game strategies and how they were evolving, which players and teams had rivalries, which had good story arcs (the underdog that finally wins, the fallen idol, the raw intuitive talent vs the grinder who out-works and out-practices everybody else, etc).
I spent countless hours watching games, tournaments. Converted a couple friends to it and watched finals with one of my buddies, and it was about as fun as anything else.
So that helped me really get what it is to follow Hockey or Football or whatever.
Another similar experience was watching the documentary ‘The Last Dance’ (2020) about Michael Jordan and his era of the Chicago Bulls earlier this year. Despite having never watched any basketball, I still appreciated not only the general life lessons from it, but I could see how those who had invested the time could get huge emotional pay-offs from the drama, and how it’s the kind of culture that is tailor-made to be shared with friends and to provide something to bond over and spend time talking about.
It similar to how, as a late-teen, some of my friends played in a band together. I didn’t join because the music style wasn’t quite my thing, and I didn’t think I was a good enough guitar player. But I did feel like I was missing out on that built-in reason to see each other frequently, to go out in a van for shows and have crazy adventures that we all talked about for years. I was there for some of it, but it’s never the same when you’re not in the band…
So basically, sports is a big band that anyone can join, even if you can’t do sweep picking for crap…
Wow, I didn’t know I would end up with that conclusion, but after writing the above, it’s the logical place to end.
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Investing & Business
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‘Okay Warren, you now own a railroad.’
I was recently reminded of an interview with Matt Rose from 2018 in Railway Age (what an awesome name for a magazine… I almost want to buy some physical copies just to keep around, as a conversation starter once this pandemic is over).
Here’s the part I love, about when Rose called Buffett after learning that the BNSF had been acquired:
I called Warren, and I said, “Okay Warren, you now own a railroad. Congratulations. What do you want me to do? You want me to come to Omaha and bring a power point and show you what our next five-year plan’s going to be?” And he said, “No. I want you to run this company like you own it, and you’re going to be in charge of it for the next 100 years.” And I don’t think that’s consistent with a hedge fund wanting to know what the next quarter’s going to look like. [...]
When we did the deal in 2009, I told our management team that it would probably take us 10 years to look back and say whether or not this was a good experiment. And by that I meant, could we outperform vs. being a standalone company? And I think the answer is yes. Why is that? Warren has given me, personally, tremendous flexibility to run the company.
They’ve got a couple basic philosophies. Charlie Munger, who’s Warren’s right-hand man, says, “We don’t have to make the last dollar.” Warren talks about this in his annual letter. He says that we make these investments with the belief that the future regulator—not the regulator who’s there today, the regulator who’s there tomorrow—will take all this into account. I simply call it the unwritten commitment. That is, we spend enormous amounts of capital on these networks, and we get a regulator who allows us to provide good returns.
Thanks to MarAzul for originally posting it on Twitter.
U.S. E-Commerce Pre-and-Post COVID19
Cool graph by James Ho of Altimeter:
Amazon still gaining share
But the others slowly catching up.
Real question is where did the 500bp+ of combined share come from?
And no it's not eBay I already included them 😛😅
Stripe is Huge
Speaking of e-commerce:
Financial technology startup Stripe Inc. is in talks to raise a new funding round valuing it higher than its last private valuation of $36 billion, according to people familiar with the matter.
The valuation being discussed could be more than $70 billion or significantly higher, at as much as $100 billion (Source)
The first photo in edition #28 is a photo of Stripe as a startup 10 years ago.
Interview with Jensen Huang, Nvidia CEO
VentureBeat has an interview with Jensen. Some highlights:
Q: What do you think about the environment for antitrust?
Jensen Huang: There’s nothing on my radar. All the businesses we’re in are super-competitive. Arm has giant customers. The new markets they want to grow into, they’re the severe underdog. There’s every reason to believe that by adding more horsepower to Arm, we’re going to increase customer choice and increase innovation in the marketplace. Our assessment is that regulatory is going to be quite favorable to this transaction. [...]
Q: What do you think of the PC versus console right now? There’s an interesting competition shaping up.
Jensen Huang: I don’t really think they’re competitors. The things you can do on a PC, you can’t do them on a console. But the thing that’s great is that all the content developers are having to raise the bar because the consoles are so powerful. Everyone is moving to ray tracing, which is fantastic. All of that is good for gaming. [...]
On gaming and AI, the two big segments of the company:
Jensen Huang: It’s a foregone conclusion that everybody in the world will be a gamer someday. There are only a billion active gamers today. Someday there will be 7 billion, 8 billion active gamers. The growth opportunity for gaming is still well ahead of us. Gaming is the only entertainment that can be any entertainment. You and I both know that when the metaverse [arrives], we’re going to spend a lot more time in game worlds, not just to game, but just to hang out, to be with people, to interact with people. The gaming market has a great future ahead of it.
On the other hand, I also know that AI is a new way of writing software, and this way of writing software is going to impact every industry. Because we can now write software that we otherwise could not before. Computing could reach more places that we otherwise could not before. For example, who would have thought that on the roads of the future, a billion computers could be just driving around? Who would have thought that, in the future, there will be thousands of computers roaming around warehouses and factories? Those are all new applications that otherwise wouldn’t have been possible without AI.
Every building will be an AI. Everything will be an AI. That’s going to generate a lot of data, a lot more computing. The computer industry is going to be gigantic because of AI. It’s the catalyst that’s been missing. It’s the final piece of the puzzle, to write the software. If someone can write the software, we can sell a computer. Now we can have computers write software. Those two businesses are long-term secular opportunities.
I love people who has such a clear vision of the future and are working hard to build it. Too many CEOs are thinking about the next quarter and the next couple years, and what they see is mostly the same as today (but hopefully more profitable)…
Semiconductors: 2019 revenue in billions of U.S. dollars
Source. h/t Nick Ellis
Elon Musk Now Richer than Bill Gates ($128bn)
Tesla’s market cap passed $525bn on Tuesday, making Musk the second-richest man in the world, behind Bezos. Who would’ve expected this a few years ago? Even the bulls and stans are probably surprised that it actually happened this quickly.
Back in 2014, Larry Page said (not sure how seriously) that he’d rather give all his money to Musk than to charity, and now Musk is richer than Page (estimated at $75-80bn, I’m too lazy to open the proxies and figure out the exact amount).
At the beginning of 2014, Musk was worth around $5bn, I think, and at the time everybody thought Tesla equity was a huge bubble about to pop any day now.
Interview: Chris Best, Substack co-Founder and CEO
Just like the media likes nothing better than to write about the media and Hollywood to make films about Hollywood, when you sign up for a Substack account, the terms make you promise that you have to write about Substack once in a while…
This interview of Substack’s co-founder and CEO, Chris Best, is quite good. Jason Calacanis knows the online media space well, having grown up swimming in those waters, and asks good questions — some tough ones too, like about how Substack can prevent all its biggest stars from eventually moving to their own domains to avoid giving them a 10% cut.
Here’s both the video and the podcast versions:
Interview: Science of Hitting (Podcast)
Good thoughtful conversation with Alex a.k.a. Science of Hitting and Tobias Carlisle, perfect for a walk in the new snow. Some of the companies discussed: BRK, BKNG, WFC, MSFT, QRTEA.
Pay Attention Kids, This is How You Do Marketing
Email I got from Zoom:
This Thanksgiving, we are thankful for Zoomers, our amazing customers that have inspired and delighted us in 2020.
To show our appreciation, we will be lifting the 40-minute time limit starting at midnight on November 26th through 6 a.m. ET November 27th for meetings globally. We hope you are able to connect with family and friends to share a meal, raise a glass, and swap stories.
This has been covered many places (CNN, The Verge, etc — “earned” media is best media)…
Science & Technology
Another one from Ken Shirriff’s blog about computer history, via Massimo.
This is a core memory module from the Saturn V LVDC (Launch Vehicle Digital Computer). This module stored 4K words of 26 data bits and 2 parity bits. It weighs 2.3 kg (5.1 pounds) and measures about 14 cm×14 cm×16 cm (5½"×5½"×6")
Basically, this thing that would hurt your foot if you dropped it couldn’t hold in memory the files for the fonts for the text that you’re reading right now.
More about the whole LVDC here.
Microsoft’s Pluton Security Processor to be Embedded in Intel, AMD, Qualcomm Chips
Ok, this is geeky, but kinda cool:
In collaboration with leading silicon partners AMD, Intel, and Qualcomm, we are announcing the Microsoft Pluton security processor. This chip-to-cloud security technology, pioneered in Xbox and Azure Sphere [...]
Today, the heart of operating system security on most PCs lives in a chip separate from the CPU, called the Trusted Platform Module (TPM). The TPM is a hardware component which is used to help securely store keys and measurements that verify the integrity of the system. TPMs have been supported in Windows for more than 10 years and power many critical technologies such as Windows Hello and BitLocker. Given the effectiveness of the TPM at performing critical security tasks, attackers have begun to innovate ways to attack it, particularly in situations where an attacker can steal or temporarily gain physical access to a PC. These sophisticated attack techniques target the communication channel between the CPU and TPM, which is typically a bus interface. This bus interface provides the ability to share information between the main CPU and security processor, but it also provides an opportunity for attackers to steal or modify information in-transit using a physical attack.
The Pluton design removes the potential for that communication channel to be attacked by building security directly into the CPU. [...] Windows devices with Pluton will use the Pluton security processor to protect credentials, user identities, encryption keys, and personal data. None of this information can be removed from Pluton even if an attacker has installed malware or has complete physical possession of the PC. (Source)
Microsoft has always been good at partnering with others. This is a good example.
‘10 bands of latitude and longitude with equal populations’
That one tiny strip going through India in the second map compared to the entire west side of the map covering the Americas. It's insane how they are equal. (Source)
The Arts & History
Space Art is a Thing
So I’ve been exploring TikTok a bit in recent months (I know, it must mean that it’s about to become uncool to kids if a 38yo joins), and the algorithm is indeed pretty good, because one of the things it served me up is the Space Art of Cathrin Machin, an Australian artist who is “obsessed with astronomy and scotch” (☑️ and ☑️) and paints things like nebulas, neutron stars, galaxy clusters, and giant space-dust clouds…
This video showing a lot of her work is pretty funny (it contrasts it with what people generally think of as “space art”).
She also posts a lot of her stuff on Instagram. You can follow her on Twitter here.
Her official website is here, and if you want to be added to a mailing list where she announces when new paintings are available for sale, you can do that here.
Netflix’s ‘Queen Gambit’ Numbers
On Netflix, a record-setting 62 million households chose to watch The Queen’s Gambit in its first 28 days [our biggest limited scripted series ever.]. Its global reach has been extraordinary - from Russia and Hong Kong, to France, Taiwan and Australia. In fact, the show made the Top 10 in 92 countries and ranked No. 1 in 63 countries, including the UK, Argentina, Israel, and South Africa. [...]
The Queen’s Gambit novel is now on The New York Times bestseller list - 37 years after its release;
Google search queries for chess have doubled while searches for “how to play chess” have hit a nine-year peak;
Inquiries for ‘chess sets’ on eBay are up 250% and Goliath Games says its chess sales have increased over 170% ; and
The number of new players has increased five fold on Chess.com.
I didn’t even know until reading this that it was based on a book. Looks like a good one. Source. h/t Jerry Capital