Monday 17th June 2019
  • Be a Better Negotiator in Everyday Life

    Negotiating, most of the time is something that requires significant prep: Doing research, practicing your lines, giving yourself the requisite pep talk, and finally wiping sweaty palms before walking into the boss's office or the car dealership to make your case. This is a high-stakes battle of wits, and you want to be as ready as you can possibly be. Or at least, that's how most people think of it. Really, though, negotiating isn't an isolated activity to be stressed over and meticulously planned; it's something you're doing all the time, with everyone around you, in ways large and small - figuring out how to share expenses with a partner, making vacation plans with a friend, or splitting up a project with a colleague.

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  • Subject: Airbnb

    Yesterday Fred Wilson published a remarkable post about missing Airbnb. VCs miss good startups all the time, but it's extraordinarily rare for one to talk about it publicly till long afterward. So that post is further evidence what a rare bird Fred is. He's probably the nicest VC I know.

    Reading Fred's post made me go back and look at the emails I exchanged with him at the time, trying to convince him to invest in Airbnb. It was quite interesting to read. You can see Fred's mind at work as he circles the deal.

    Fred and the Airbnb founders have generously agreed to let me publish this email exchange (with one sentence redacted about something that's strategically important to Airbnb and not an important part of the conversation). It's an interesting illustration of an element of the startup ecosystem that few except the participants ever see: investors trying to convince one another to invest in their portfolio companies. Hundreds if not thousands of conversations of this type are happening now, but if one has ever been published, I haven't seen it. The Airbnbs themselves never even saw these emails at the time.

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  • "A Lesson on Elementary, Worldly Wisdom" by Charlie Munger

    What is elementary, worldly wisdom? Well, the first rule is that you can't really know anything if you just remember isolated facts and try and bang 'em back. If the facts don't hang together on a latticework of theory, you don't have them in a usable form.

    You've got to have models in your head. And you've got to array your experience - both vicarious and direct - on this latticework of models. You may have noticed students who just try to remember and pound back what is remembered. Well, they fail in school and in life. You've got to hang experience on a latticework of models in your head.

    What are the models? Well, the first rule is that you've got to have multiple models - because if you just have one or two that you're using, the nature of human psychology is such that you'll torture reality so that it fits your models, or at least you'll think it does. You become the equivalent of a chiropractor who, of course, is the great boob in medicine.

    It's like the old saying, "To the man with only a hammer, every problem looks like a nail." And of course, that's the way the chiropractor goes about practicing medicine. But that's a perfectly disastrous way to think and a perfectly disastrous way to operate in the world. So you've got to have multiple models.

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  • How Corporations Can Better Work With Startups

    One way that corporations spur innovation is by working with startups - through mechanisms such as corporate accelerators, venture builders and venture clients. Since 2013 the number of corporate investments in startups has nearly tripled from 980 in 2013 to 2,795 in 2018, and their value has risen from $19 to $180 billion, according to GCV Analytics, a company that tracks corporate venturing deals.

    Yet the success rate of these initiatives is low. Research we conducted with chief innovation officers (CINOs) and others in similar roles in the United States, Asia and Europe, shows that around three quarters of corporate innovation initiatives fail to deliver the desired results. Failed projects don’t help a company fend off hungry, agile competitors.

    To discover the challenges that arise in these initiatives, we talked to more than 120 CINOs in 22 sectors. They shared the challenges that derailed (or threatened to derail) their projects and described the approaches they deployed to surmount them. We found that three strategies are proving effective against 80% of the major issues.

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  • 10 ways cities are tackling the global affordable housing crisis

    The unprecedented rate of urbanization across the world has led to increased demand for good, affordable housing. A recent survey revealed that of 200 cities polled around the globe, 90% were considered unaffordable when applying the widely-used standard of average house prices being more than three-times median income.

    Affordability is not just about the ability to buy or rent a home, but also about being able to afford to live in it. This definition of affordability goes beyond meeting expenses related to operations and maintenance, taking into consideration transport, infrastructure and services. If a home is economical enough to buy and maintain but located too far from work or school, it cannot be said to be affordable.

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  • Automation in retail: An executive overview for getting ready

    Retail is under pressure. Margins are stressed from all sides: higher costs to manage e-commerce supply chains, growing demands from suppliers to pass on raw-material cost inflation, higher investments to match new competition, and steadily rising labor costs. At the same time, the customer's expectations continue to surge as digital natives and disruptors alike raise the bar for personalized service - on the back of what, at times, is an advantaged cost structure. As retailers struggle to adapt, and even to survive, they increasingly pursue automation to address margin strain and more demanding customer expectations. Automation, however, is a new capability for all but digital natives, and the sophistication in approach varies accordingly.

    Over the past three years, the McKinsey Global Institute has conducted a broad-based research initiative on automation across sectors. This research has shown that about half of the activities in retail can be automated using current, at-scale technology. While this number is alarming, the change will be less about job loss and more about the evolution of jobs, the creation of new ones, and reskilling. Only about 5 percent of all jobs can be fully automated with current technology, and automation will lead to the creation of jobs as companies invest in growth.

    In our work in the retail sector, we see automation reshaping business models and the broader value chain. Let’s start with four new realities we observe among retailers.

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  • Want to know when you're going to die?

    Your life span is written in your DNA, and we're learning to read the code.

    It's the ultimate unanswerable question we all face: When will I die? If we knew, would we live differently? So far, science has been no more accurate at predicting life span than a $10 fortune teller. But that's starting to change.

    The measures being developed will never get good enough to forecast an exact date or time of death, but insurance companies are already finding them useful, as are hospitals and palliative care teams. "I would love to know when I'm going to die," says Brian Chen, a researcher who is chief science officer for Life Epigenetics, a company that services the insurance industry. "That would influence how I approach life."

    The work still needs to be made more practical, and companies have to figure out the best uses for the data. Ethicists, meanwhile, worry about how people will cope with knowing the final secret of life. But like it or not, the death predictor is coming.

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  • Why You Should Create a "Shadow Board" of Younger Employees

    A lot of companies struggle with two apparently unrelated problems: disengaged younger workers and a weak response to changing market conditions. A few companies have tackled both problems at the same time by creating a "shadow board" - a group of non-executive employees that works with senior executives on strategic initiatives. The purpose? To leverage the younger groups' insights and to diversify the perspectives that executives are exposed to.

    They seem to work. Consider Prada and Gucci, two fashion companies with a good track record of keeping up with - or shaping - consumer tastes. Until recently, Prada enjoyed high margins, a legendary creative director, and good growth opportunities. But since 2014, it has witnessed declining sales. In 2017, the company finally admitted that it had been "slow in realizing the importance of digital channels and the blogging online 'influencers' which are disrupting the industry." Co-CEO Patrizio Bertelli said, "We made a mistake."

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  • In the age of fake news, these digital watermarks could stop the spread of fake images

    To thwart deep fakes, researchers have developed an experimental technique to authenticate images from acquisition to delivery using artificial intelligence.

    Determining whether a photo or video is authentic is becoming increasingly problematic. Sophisticated techniques for altering photos and videos have become so accessible that deep fakes - manipulated photos or videos that are remarkably convincing and often include celebrities or political figures - have become commonplace.

    In tests, the prototype imaging pipeline increased the chances of detecting manipulation of images and video from approximately 45 percent to over 90 percent without sacrificing image quality.

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  • Jeff Bezos: Big Things Start Small

    When asked about the pressures of running a public company and meeting quarterly earnings expectations Jeff Bezos said:

    Well, I think that if you're straight forward and clear about the way that you're going to operate, then you can operate in whatever way you choose. We don't even take a position on whether our way is the right way, we just claim it's our way, but Warren Buffet has a great saying along these lines. He says, "You can hold a ballet and that can be successful and you can hold a rock concert and that can be successful. Just don't hold a ballet and advertise it as a rock concert. You need to be clear with all of your stakeholders, are you holding a ballet or are you holding a rock concert and then people get to self-select in."

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