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Over the past two weeks I’ve heard the word “contrarian” more times than I can count. Suddenly, to become a successful investor in any segment (angel, venture capital, public markets, debt markets) you have to be contrarian. The assertion that a “contrarian strategy” always wins seems to be in the air.
When I ask people what they mean by “contrarian”, I’m amazed at how often they define it as either as “actively investing” or “sitting on the sidelines.” Specifically, “there are too many people investing at this point – I’m going to take a contrarian approach and sit on the sidelines for a while.”
To me, contrarian means doing the opposite of everyone else. If everyone is buying, you are selling. If everyone is selling, you are buying. Our friends at Webster even give us an example:
“As an investor, he’s a contrarian, preferring to buy stocks when most people are selling.”
Now, to be fair, you can make the case that “not buying” when everyone else is buying is contrarian. But I have never thought about it that way. And, as the word contrarian enters the mainstream vernacular around entrepreneur / angel / VC land, I think it’s important to ponder what it really means, especially if the majority suddenly adopt a “contrarian strategy” which, by definition, ceases to be contrarian.
Do you remember the amazingly hilarious “We’re All Individuals” segment from Monty Python’s Life of Brian?
In 2009, the word that finally got on my nerves was “space”, as in “our product is in the X space” or “the space we are going after is X.” It seems like the word “space” managed to find its way into every paragraph.
The annoying word of 2010 appears to be “platform”, as in “we are going to be a platform for X” or “our platform for X will solve the following problems.”
In my little corner of the world, the word “platform” is a lot more precious. There are very few platforms. You aren’t a platform until you have a zillion users (well, at least 100 million). Until then, feel free to call yourself a “junior platform” or an “aspiring platform.” Or, call yourself an “application”, which is what you most likely are.
I definitely make this mistake myself (e.g. “Company Y is a platform for X”) and I’ve been self-censoring lately and now saying “Company Y aspires to be a platform for X”).
Ok, I feel better now.
I’m been fighting through one of the worst colds I’ve ever had. I started feeling crummy on Friday, spent the entire weekend in bed, suffered through work on Monday, and had the entire experience crest with the worst headache and one of the longest pain filed and sleepless night ever. I finally am feeling better today, but man that was a nasty 27 headed viral monster.
I’ve never been a fan of handshakes. While I get the formality of it, I hate germs and – in a parallel universe – would probably spend all my time with my extremities wrapped in saran wrap. I’ve had a running joke of it with some friends, including Paul Kedrosky, who also thinks handshakes are stupid.
Today, Paul and I decided to start a movement – “No More Handshakes in ‘09"’. Fist bumps, elbow bumps, and hugs are fine – just no handshakes. Join us!
I do this every year just because it’s a pet peeve of mine. It’s now officially 2009 – time to update all those copyright notices if you haven’t turned the ending year into a variable. What’s the point of these stupid copyright notices on the bottom of every web page anyway?
Kudos to Matt Blumberg at Return Path for (a) reminding me about this and (b) having his copyright notices automated. Google – not so automated. Microsoft – not so automated (although Live appears to be). Yahoo – automated! Ask – not so automated. Ebay – not so automated. IBM – not so copyrighted! I could go on but it’s time to go have lunch with my partners.
Oh goody, they are here. Every magazine, newspaper, and most of the online publications known to man are putting together their “2008 year in review” and their “2009 prediction” editions. What a fucking waste of human energy.
This has been one of my pet peeves for 20+ years. For a while I managed to ignore them completely. At some point I started getting asked for my predictions and succumbed to my ego for a few years and participated in the prediction folly. At some point I realized that there was zero correlation between my predictions and reality and that by participating, I was merely helping perpetuate this silliness.
The energy that goes into the “year in review” and “prediction” stuff seems to be significantly greater in “extreme” (both good and bad) times. The prognostications become stronger and bolder. The analysis by hindsight intensifies. I don’t think this benefits anyone.
Over dinner recently, I was having a discussion with a friend. The conversation took place in a very full and busy restaurant. At some point the discussion turned to the sentiment throughout the United States right now and how the level of anxiety, negativity, pessimism, depression, and downright panic seemed at an extremely high level and appeared disconnected from general reality. We talked about what “general reality” meant for a little while – both “our realities” (which are different) as well as our view of the “actual general reality in the United States.”
As we rolled through some of the discussion, I made the offhand comment that I thought much of the sentiment that existed started near the end of the summer a few weeks before the DNC. As I thought about it more, it made sense. For the 90 days prior to the election, all we heard and read was “things suck in America.” Oil hit $135 / barrel and was going to go to $200 / barrel (it’s $35 / barrel today.) Gas was going to be $10 / gallon (it’s under $2 / gallon in Colorado today.)
I was on vacation in England the week Lehman went bankrupt, AIG melted down, and Merrill Lynch got bought by Bank of America. Amy and I rarely watch TV on vacation (other than movies) but since CNBC’s Closing Bell was on about the time we were crawling into bed, we watched it as though it was a sporting event. Over the course of the week, we must have seen 100 different people predict 500 different things. 485 of them were wrong. Oh – and I read Taleb’s The Black Swan: The Impact of the Highly Improbable during this week and just could stop bursting out with cynical laughter each evening. Over the 90 days we heard over and over again how much America sucked. How many problems we had. How everything was totally screwed up.
Of course, the financial markets have been a disaster in Q3 and Q4. The housing bubble has finally officially exploded (doesn’t explode sounds more dramatic than burst.) Unemployment is rising. Credit is frozen. Retail sales are massively off this Christmas. All companies except Walmart are having a tough Q4. Blah blah blah. And now come the 2009 predictions.
My prediction for 2009 – the vast majority of the 2009 predictions will be wrong. Ignore them. Find a Dharma that fits your Karma (more on that when I review Strategic Intuition: The Creative Spark in Human Achievement (Columbia Business School) by Bill Duggan, which I read last night.) You get a finite number of years on this planet – make the most of all of them, no matter what is going on around you.