The Connection Newsletter 26 - Perseverance

The Connection Newsletter 26 - Perseverance vs. Delusion

September 24, 2018

Hello!

This is edition #26 of

The Connection

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First, an

. I strongly believe if you have a Dream, regardless of the odds, you have to try. What I’ve been wrestling with is, what’s the line between perseverance and delusion? Here are some questions I pose to myself to decide -- I call it my “sanity checklist.”

, would love to hear what you think.

Next, onto the articles this week:

…

. In Connection #14, I wrote about David Chang’s prediction that food delivery services would force mom-and-pop restaurants out of the market:

“...mom-and-pop restaurants are the ones that will feel the squeeze and get forced out of the market. When you realize that: (1) these delivery service fees eat up the entire margin on an order and(2) their dominance in SEO means customers will completely bypass the restaurant and order directly from the delivery service”

Casey Winters (former Growth Lead at Grubhub) made the case this is just a (common) misconception. He argues that food delivery marketplaces help restaurants capture unrealized profit. Two pieces of supporting evidence:

1. For food delivery marketplaces, the

under-utilized fixed asset is not the restaurant, but the kitchen.

2.

Restaurant loyalty is one of the least important and last steps in the process of the person ordering food.

This means people ordering food do not have loyalty, and you need to compete for every order as if it’s the first.

…

. This is Jedi-level, not for the faint of heart, and goes deeper than the usual “hacks” e.g. make your bed, meditate, Pomodoro, etc.

Some key points worth highlighting:

  • “I’m almost always working on something”... and why that’s a good thing

  • The difference between macro and micro planning

  • Clearly defined non-negotiables e.g. sleep, exercise, etc.

  • Cleary define trade-offs e.g. television, YouTube, responsiveness, etc.

…

. An expert explains why Burberry, H&M, Nike, and Urban Outfitters destroy unsold merch — and what it says about consumer culture. The highlights:

  • Fashion cycles have also gotten shorter because of the internet and fast fashion, so there’s a push to constantly put new merchandise out on the market. This combinations means there’s no place to put this stuff, so now companies just need to get rid of it.

  • How? Burning and shredding are the main methods. The third is simply landfilling.

  • Why not donate it? Because a number of countries have banned the importation of second-hand clothing , since it suppresses their own textile and apparel industry,

  • Isn’t it better to discount than to destroy? Not necessarily: It can be damaging to brand. And destroying a $1,200 Chanel dress doesn’t cost Chanel $1,200 -- it might have cost less than $100 to produce.

Also worth checking out: Andrew Morgan’s documentary

(it’s on Netflix)!

…

. Many of these benefits were very much on my mind when I bought my house. The emotional benefits of buying a house can be replicated by renting. And people underestimate the benefits of renting including the lack of stress, extreme liquidity, and freedom.

Advantages of owning a home:

  • Taxes

  • Leverage

  • Peace of mind

Advantages of renting:

  • Low stress

  • Liquidity

  • Optionality

I agree with many points in this article. Yet three months ago I bought a house.

.

(H/t Ramit for sharing this article via Twitter.)

…

. Social Capital arrived in Silicon Valley seven years ago with a charismatic co-founder, former Facebook executive Chamath Palihapitiya who also owns a piece of the Golden State Warriors. It raised more than $1 billion and made early bets on companies like Slack.

The firm is currently imploding and nine sources blame Palihapitiya for its demise. It’s being called Silicon Valley's Icarus story.

. 

…

Very

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