62: My Thoughts on Pride, Snowflake ❄️ Slootman's Paycheck, Daniel Ek Interview, Nvidia Does More With Less, FireEye Hacked, Allulose, and Chuck Yeager (1923-2020)

"that’s almost a Buffett-like base salary, right?"

Wisdom is not only to be acquired, but also to be utilized.

—Marcus Tullius Cicero

Here’s my thoughts on pride:

I don’t feel like I can be proud of things that I have purely because of a roll of the dice. For example, I don’t feel proud of speaking French, because I don’t even have memory of learning it.

But I’m proud of my English skills, because I learned the language relatively late (between 15-18yo, mostly), and it didn’t come easy, as I have no particular aptitude for languages.

To me, learning it was a means to an end — I cared about music, computers, video games, and wanted to watch un-dubbed TV shows. I didn’t learn much from school, it was too boring. It was The Simpsons, Frasier, Futurama, and Third Rock from the Sun with the subtitles on (to see what I was hearing).

In the same way, I don’t feel what I’d describe as pride about being a Canadian or Québecois. I can love many things about where I live, I can want to make the place better, I can appreciate many things about the culture, etc. But to me, it doesn’t fall under “pride”. I was just randomly born here, I could’ve been born an Afghan woman. I had nothing to do with any of it, pure chance. Should I be proud of having brown hair? What’s the point?

I’ve always felt like immigrants have a rational claim to pride about where they live, because they chose it, made the decision to go, worked for it, and it probably required sacrifice (leaving behind friends, family, and culture).

So if you’ve decided to move across the globe to become an American or a Canadian or whatever, and you succeeded, I think you can be proud of that, it’s a real accomplishment. Kudos to you! I know it would be a big deal to me and my family if we had to move to China.

Side note: Another context where the word “pride” is used is gay pride, LGBT pride, etc. I have no problem with that, because I see it as meaning something different than what I’m talking about above.

The way I grok it, it’s a positive word that is mostly used to mean the absence of the negative opposite (ie. “we’re not ashamed”), which was the dominant societal pressure for so long (ie. “you should be ashamed, you should hide” “No we won’t hide, and there’s nothing to be ashamed of.”). So the very words “gay pride” may sound like “white pride” or “heterosexual pride”, but the underlying meaning is different.

Man, people who joined this newsletter for stock tips must be tripping balls with these intros…

✥ Shower thought (didn’t actually have it in the shower, I don't want to lie to you):

There's one of you and billions of others.

Thanks to the internet, you can now find millions of people who dislike/disagree with anything you do, whatever you decide to do.

In this context, the best strategy is often to work on not caring what most* others think, rather than attempting to somehow please everybody. When feedback is scarce, it’s valuable. When it’s overwhelming and paralyzing, it’s the filter that becomes valuable.

*Obviously you should care about what people you respect and love think. But there’s usually not hordes of those, and if you don’t discriminate on your feedback sources, they can get drowned out by everybody else that has access to your mental space — if you let them.

✘ I don't recommend jealousy, but if you're going to do it, be jealous of happy people, not wealthy ones.


Investing + Business

Frank Slootman Comp Package: $1.3bn/Year

A compensation package he received upon joining Snowflake in April 2019 awards him a batch of options every month -- for four years -- that are now worth more than $108 million each [month], or about $1.3 billion annually.

Slootman’s pay includes more than 13.7 million options with a strike price of $8.88. The vast majority can already be exercised but the underlying shares vest monthly over four years, beginning with the month he started.

He also gets a $375,000 annual base salary, which can go higher depending on the firm’s performance.

Wow, that’s almost a Buffett-like base salary, right?

Once the full options package is paid out in early 2023, it would be worth about $5.2 billion based on the latest share price. [...]

In October 2018, about six months before Slootman joined and negotiated his compensation, the company raised funds at a valuation of about $3.5 billion. It’s now worth almost $110 billion. (Source)

Just earlier this year, in edition #27 on September 18, I wrote:

To put things in context, they raised money at around $12bn earlier this year.

Either they basically gave away a chunk of their company to private investors, or there's a massive amount of turbo-FOMO going on... Not saying $12bn is the correct valuation today, but 7 times that may be a little... extreme?

How quaint that now seems, with fully-diluted market cap around $150bn.

h/t Joe Weisenthal

Interview: Daniel Ek, Spotify CEO

Some may think I’m anti-Spotify because I’ve been a critic of their approach with podcasts (you can read it in edition #18 under the heading ‘My Worries about Spotify & Podcasting’), but I think it’s important to be able to untangle the good & the bad in various things.

You may like certain things that Google does, and not others, certain things that Apple does, and not others. Etc etc. Companies are not sports teams, it’s pointless to get tribal about them and try to excuse their flaws just because we like them.

Anyway, Tim Ferriss did a good interview with Ek. It’s 60% about him personally, and 40% about Spotify and his role as CEO. There are definitely some similarities to listening to an interview with Tobi Lütke.

There’s also the transcript at the link above, if you prefer to read than to listen.

I thought his observation about how certain jobs can change a lot even if the title stays the same. He estimates that he’s had like 8 different jobs at Spotify, and it has been very different to be a startup founder than to be the person that is trying to set the tone to the leaders under him who then deal with thousands of employees.

World Largest Automakers by Market Capitalization

h/t Dividend Growth Investor

Trigger Warning: Elon Musk Interview

Brad Slingerlend was right, it was an interesting one.

I liked the part where the interviewer asks him if he’s looking at buying a house in Berlin, and Musk answers that sometimes he stays at hotels, but tonight he’s sleeping in a conference room at the factory. How many other multi-billionaires are doing that tonight?

  • Video. Transcript. (somehow the transcript isn’t in the same order as the video)

‘U.S. cybersecurity firm FireEye discloses breach, theft of internal hacking tools’

This is bad. Almost as bad as this.

FireEye, one of the largest cybersecurity companies in the United States, said on Tuesday that is has been hacked, possibly by a government, leading to the theft of an arsenal of internal hacking tools typically reserved to privately test the cyber defenses of their own clients. (Source)

Sounds like the Red Team tools. There’s a Blue Team that focuses on defense, and a Red Team that tries to breach those defense to test their effectiveness.

They’re getting help from the FBI and Microsoft for the investigation.

Here’s what FireEye’s CEO wrote:

Based on my 25 years in cyber security and responding to incidents, I’ve concluded we are witnessing an attack by a nation with top-tier offensive capabilities. This attack is different from the tens of thousands of incidents we have responded to throughout the years. The attackers tailored their world-class capabilities specifically to target and attack FireEye. They are highly trained in operational security and executed with discipline and focus. They operated clandestinely, using methods that counter security tools and forensic examination. They used a novel combination of techniques not witnessed by us or our partners in the past. [...]

We have seen no evidence to date that any attacker has used the stolen Red Team tools. We, as well as others in the security community, will continue to monitor for any such activity. [...]

Consistent with a nation-state cyber-espionage effort, the attacker primarily sought information related to certain government customers. While the attacker was able to access some of our internal systems, at this point in our investigation, we have seen no evidence that the attacker exfiltrated data from our primary systems

Yikes. More here.

MBI Subs: Choose Your Own Adventure

High-Quality Classifieds

Dennis Hong of Shawspring wrote:

Please consider joining our team! My teammates and I are currently seeking a talented investment professional to help us generate exceptional returns for our investment partners. We look forward to hearing from you!

Here’s the link to the job listing.

I’m only posting it because everything I know about Dennis is positive and impressive. Anyone would likely be very lucky to join that team.


Science + Technology

NVIDIA Research Achieves AI Training Breakthrough Using Limited Datasets’

Really cool software from Nvidia, helping train neural network models on smaller datasets when bigger ones aren’t available, or when it’s simply too expensive to gather the large dataset required by previous methods.

The video above explains it pretty well, but here’s a few highlights:

The technique — called adaptive discriminator augmentation, or ADA — reduces the number of training images by 10-20x while still getting great results. The same method could someday have a significant impact in healthcare, for example by creating cancer histology images to help train other AI models. [...]

It typically takes 50,000 to 100,000 training images to train a high-quality GAN. But in many cases, researchers simply don’t have tens or hundreds of thousands of sample images at their disposal. (Source)

The full research paper is here.

Hello Allulose (101 on this sugar replacement)

Peter Attia has a good post on Allulose, an interesting sugar replacement.

Context from Wikipedia: “Its taste is said to be sugar-like, in contrast to certain other sweeteners… The caloric value of allulose in humans is about 0.2 to 0.4 kcal/g, relative to about 4 kcal/g for typical carbohydrates… The glycemic index of allulose is very low or negligible.”

An animal eats fructose to store energy in preparation for hibernation, for example. [...] In western societies, the most commonly used sweeteners are sucrose (table sugar) and high fructose corn syrup (HFCS), an artificial product made from corn starch. The problem with the cumulative amount of sugar consumed in most modern societies today is that we effectively make our bodies believe it is wintertime all year round. [...]

Allulose is on the top of my preference list for both objective and subjective reasons. Let’s start with the facts. The molecule has been around for a long time (found naturally in small quantities in some fruits), but it was only in 2014 that it was given a generally regarded as safe (GRAS) food designation by the Food and Drug Administration (FDA)—indicating the general expert consensus on a substance’s safety.

Here’s an interesting bit of unintended consequences, showing once again the power of incentives:

Until recently, it was not commonly used in the US because the FDA did not differentiate it from sucrose or HFCS. In other words, it had to be listed on ingredient labels as an added sugar, turning off any potential customers not fully in the know.

🤦‍♀️

allulose is mostly absorbed in the small intestine without being converted into energy: at least 90% is excreted by the kidneys without being metabolized. This means that in a functional sense allulose has 95% fewer calories than sucrose and is why the FDA determined in 2019 that it does not need to be listed under total or added sugar.

But it’s maybe even better than just “not being a negative”, it looks like it could potentially even be a positive:

Data from animal studies suggest that compared to fructose and/or glucose, allulose may lower blood glucose, reduce abdominal fat, decrease insulin resistance and fat accumulation in the liver, and prevent or delay the onset of type 2 diabetes. In a recent meta-analysis of human trials, when allulose was given with carbohydrate-containing meals, it was found to decrease postprandial glucose by 10% (noting that the quality of evidence is moderate).

Attia wears a Dexcom G6 real-time blood glucose monitor, she he’s an interesting N-of-1:

I can anecdotally support that when I put allulose into black coffee, my blood glucose goes down. Usually black coffee would be neutral for my blood sugar, so this suggests that allulose is pulling glucose out of my body via my kidneys. In my experience, it also doesn’t leave me with that weird, slightly astringent aftertaste left by many sugar substitutes

I decided to try it out (well, my wife read Attia’s post first and sent me an Amazon link for a bag of allulose, to be exact). I’ll report here when I have an opinion on it …

But if it’s as good as it sounds like, I really wish production would be scaled up and price would go down (a lot) so that it can more widely be used. That would save some lives, and reduce a lot of human suffering, because not everyone will significantly cut sugar, and even those that do could probably use a low-glycemic cookie that tastes good once in a while.

While we’re on this topic, here’s a must-listen episode of Attia’s podcast on fructose and its effects (I need to re-listen to it soon). Trust me, the topic is more interesting and actionable than it seems:

Apple, Cloudflare and Fastly Create More Private DNS Protocol

we are announcing support for a new proposed DNS standard — co-authored by engineers from Cloudflare, Apple, and Fastly — that separates IP addresses from queries, so that no single entity can see both at the same time. Even better, we’ve made source code available, so anyone can try out ODoH, or run their own ODoH service! [...]

ODoH works by adding a layer of public key encryption, as well as a network proxy between clients and DoH servers such as 1.1.1.1. The combination of these two added elements guarantees that only the user has access to both the DNS messages and their own IP address at the same time.

This is pretty cool. More details here.


The Arts + History

Chuck Yeager: 1923-2020

A great man and a pioneer has died. My introduction to the general was Tom Wolfe’s book ‘The Right Stuff’, which I highly recommend (followed by Andrew Chaikin’s ‘A Man on the Moon’, if you want to keep follow this bunch of test pilots, many of who became astronauts in Gemini, Mercury, and Apollo).

It may be out of stock for a while, but Yeager also wrote an autobiography.

Technically, a fighter “ace” refers to a pilot who has shot down at least five enemy aircraft in aerial combat. Only a minority of wartime pilots shoot down even one enemy airplane, let alone become an ace. But Yeager belonged to an even more exclusive club—he’s one of a few combat pilots to have become an ace in a single combat mission. [...]

Yeager broke the sound barrier with broken ribs

Two days before his scheduled supersonic flight in 1947, Yeager was riding a horse with his wife at night when he was tossed off and broke two ribs. Fearing his record-breaking flight would be canceled, he had a civilian doctor tape the ribs and did not inform his superiors. Still in pain on the day of his flight, his injury forced him to rely on a jury-rigged broom handle to seal the cockpit canopy. (Source)