Rory Sutherland, A Guide To The Good Life, Sequoia, Web3 and V for Vendetta

November 7 2021

Good morning. How are you?

I am sharing this weekly email with you because I count you in the group of people I learn from and enjoy being around.

Thank you for reading.

“The only way of discovering the limits of the possible is to venture a little way past them into the impossible.”

- Arthur C. Clarke

“Waste no more time arguing what a good man should be. Be one.”

- Marcus Aurelius

“A wealth of information creates a poverty of attention.”

- Herbert Simon

“Nothing in life is to be feared, it is only to be understood. Now is the time to understand more, so that we may fear less.”

- Marie Curie

“Go as far as you can see; when you get there, you'll be able to see farther”

- Thomas Carlyle 

A. A Few Things Worth Checking Out:

1. With COP26 out of the way, it’s time to get down to business about climate change. This great chart shared by Azeem Azhar is useful in thinking about where the changes need to happen.

The source article is a good read.

Key section:

We clearly see very different positions of the world’s countries. The “high emitters” face a complex challenge: 1) accelerate their switching to an economy based on renewable energy, 2) accept the losses from stranded assets (switching off fossil-fuel based infrastructure before their end of life), and 3) finance renewable energy infrastructure in the low-emitter regions.

On the other side, “low emitters” are currently in a catch-up phase. Their priority is economic development that is linked to higher energy usage. They are called upon to give up any plans based on fossil fuels, and instead invest in renewable energies.

2. The amazing Rory Sutherland was on the Infinite Loops Podcast. He’s one of the most interesting and funniest people I know. This one is filled with insights.

For example:

“Only because reductionist logic is so reliable in the physical sciences, it doesn't mean that it is applicable everywhere—especially in the much messier field of human affairs.”

Here’s a good picture summarising Rory’s amazing book Alchemy:

3. One of the books that most impacted my life was William Irvine’s: A Guide To the Good Life. It’s a great discussion of stoic philosophy and how to apply it to your life.

He was on the Shane Parrish The Knowledge Project Podcast discussing: How To Live a Stoic Life.

Every few months, I re-read the Stoics. These are some passages I have found helpful recently in dealing with life, relationships, work and markets.

“.…freedom isn’t secured by filling up on your heart’s desire, but by removing your desire”

- Epictetus

My Lesson: There are only two ways to be wealthy - a) to get everything you want or b) want everything you have. Be wealthy right now.

“Throw out your conceited opinions, for it is impossible for a person to begin to learn what he thinks he already knows”

- Epictetus

My Lesson: As smart or successful as we may be, there is always someone who is smarter, more successful, and wiser than us. As Emerson said: “Every man I will meet is my master in some point, and in that I learn from him”

“These individuals have riches just as we say that we “have a fever,” when really the fever has us.”

- Seneca

My Lesson: Pursue freedom, not things.

4. Hot Streaks in Your Career Don’t Happen by Accident by Derek Thompson of the Atlantic. A few key bits:

Several years ago, the journalist David Epstein wrote the book Range: Why Generalists Triumph in a Specialized World, which argued that early specialization was a poor strategy for succeeding in a world of complex problems that defy easy answers. Instead, Epstein said, people are better off exploring a variety of fields and approaches and braiding their knowledge to produce new solutions. Wang’s research seems to back up that claim. The central paradox of the explore-exploit sequence is that hot streaks are examples of specialization, but specialization itself doesn’t lead to hot streaks. Today’s best exploiters were yesterday’s best explorers.

The point is not that exploration is good and exploitation is bad. It’s that all success—career success, corporate thriving, national flourishing—requires that we pay close attention to the interplay between scouting new ideas and pumping established wells. By and large, America seems to suffer from too much exploitation and too little exploration. “We’ve gotten very good at encouraging people to be more and more focused and at penalizing people who wander outside their lane,” Wang said. “I don’t think America is particularly good at rewarding novel thinking.” Indeed, we have a national scouting deficit, because our theories of success emphasize immediate productivity in a way that might obscure the benefits of a little bewilderment and curiosity.

5. Cumulative flows into stocks, bonds and cash since the GFC.

6. In 1996, there was just over 1 CFA charter holder for every 1 company listed on the US stock market. Today that ratio exceeds....45:1. The market is a complex adaptive system, what did work, will not necessarily continue to work.

7. A useful read to get ahead in your career.

B. The Tech and Crypto Section:

1. The big news in technology circles this week was Sequoia announcing its new fund structure, which brings with it more permanent capital and the ability to hold businesses once they have gone public. They already hold $45 bn of public securities!

Here’s the medium post by Roelof Botha of Sequoia announcing the move.

And the Pitchbook article discussing it further.

2. Roelof Botha of Sequoia was on Invest like the Best discussing their decision to restructure from its traditional term-based fund structure to an open ended, permanent fund called the Sequoia Fund.

His logic: the venture capital industry hasn’t changed its structure since the 1970s and in today’s world, a lot (if not most) of the value created by many of their portfolio companies is created after IPO so why should they be forced to exit to the public markets at a time where many companies are just beginning to hit escape velocity?

3. I am re-sharing this cause it’s that good. Chris Dixon and Naval were on the Tim Ferriss show discussing crypto and web3.

4. What’s the difference between the Facebook Metaverse and the “real” Metaverse? A great tweetstorm by Yat Siu, the OG of Blockchain gaming and the Metaverse.

5. A great mental model on how to value Layer 1 chains:

In honour of November 5th and Guy Fawkes day in England, I re-watched V for Vendetta.

I useful reminder for our times.