Tools for progress #55
Institutional collapse in the age of AI, Making progress on controversial problems, If you are useful, it doesn’t mean you are valued
We (humans) read hundreds of articles on company building, angel investing, and self-management and curate the best ones into a weekly summary—helping founders and operators stay on the top of their game.
Better thinking
Institutional collapse in the age of AI (11 minute read)
Kyla Scanlon, a popular economic commentator, breaks down how institutions fall apart during big tech changes. We’re actually destroying the systems we need to manage AI. Past tech revolutions built new institutions to handle the chaos. The Industrial Revolution created labor protections, public education, and financial regulations. We’re not creating new kinds of institutions to support this AI transition. We’re doing the opposite (tearing down institutions) right when algorithms might replace democratic decision-making.
Highly recommended read. Whether it’s a jacket you bought, or the software you use, quality just feels harder to come by. Lots of things nowadays feel forgettable. Sarah from Conviction Capital boils this down to “taste.” This word has been doing the rounds recently. Taste is about obsessing over the details. It’s about pursuing something excellent, leaning into craftsmanship, caring about the output. And, as Sarah argues, it’s a viable business strategy. Particularly when AI is going to make everything same-ish.
While James Clear’s right about the importance of consistency, it’s not enough to lead you to the promise land of success. Doing the same thing over and over again and expecting a different result is insanity. Instead consistency needs to be paired with extreme intensity. The best way to do that is to chase an obsession and be extreme. So extreme that others view you as an outlier. To transcend consistency, here are a few tips. First, become more selfish and make your default answer to trivial asks like a ‘pick your brain’ meeting a ‘no’. Second, put in real hours into your projects. Not 30 mins here and 60 mins there but several uninterrupted hours. You won’t feel burnout. What you will have is a religious experience. The bottom line is that life gets simpler when you combine consistency with an an obsessive mindset.
Operational tactics
It ain’t much, but it’s honest work (9 minute read)
One for the operators quietly dreaming of sacking of SaaS and rolling up laundromats and improving EBITDA with software. Boring businesses are doing pretty well right now. Here’s CJs latest dive into that, coupled with a set of SaaS benchmarks to keep you grounded.
Excel induced hallucinations (3 minute read)
Startups fall victim to “Excel-induced hallucinations” where financial models make unrealistic growth targets appear achievable on paper. Sales capacity models are particularly dangerous, suggesting companies can easily scale from $5M to $25M ARR by simply hiring more reps, while ignoring practical realities like hiring timelines, ramp periods, and attrition. Avoid this fairytale by deeply understanding the variables in your model.
Making progress on controversial problems (3 minute read)
Have you ever been pulled into a controversial strategy or team problem — one where every person involved has an opinion, no one agrees, and no one has an actual solution? At some point at any company, these thorny problems become inevitable. Rising seniority also increases the odds of encountering such challenges. If you find yourself with the most unique context, the best service you can do is synthesize the info, understand options, and recommend one, complete with trade-offs and decision criteria, in a simple, yet opinionated, document. Look, there’s no silver bullet here and you shouldn’t hold out for the perfect solution. As simple as this process is, it’ll help you tackle the hardest problems and escape messy situations unscathed.
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Venture investing
Why VCs get portfolio size (and tickets) wrong (6 minute read)
Do more bets and spread them, or do fewer based on conviction? Looking at the venture math helps here. With unicorn hit rates hovering around 0.5-2.5% (across all startups), spreading bets across 50+ companies gives you a >50% chance of finding one. Fewer investments reduces that likelihood. Diversified funds deliver better returns and way higher survival rates than most pickers. But, the very best funds (top 95%) are conviction based. So, if you’re a really good picker (like the top 25 in the world), go for fewer investments with a higher ticket size. If you’re not, spread’em.
Late cycle investment theory (35 minute read)
Long read, worth it. We’re arguably reaching the top of our SaaS/Cloud s-curve. This piece argues we are indeed in the late-cycle phase of computing. In this phase, optimisation beats disruption and new opportunities emerge (like AI, Stablecoins, and Quantum) that help us break though that s-curve. America is doubling down on financial dominance through stablecoins while China builds the infrastructure for programmable electricity. The next technological shift may center on intelligent energy systems rather than software platforms.
Social Capital’s 2024 annual letter (18 minute read)
Chamath’s back again with his annual letter for Social Capital, summarizing his investment fund’s performance till date and 2024 trends that shaped culture, economics, and politics. The newest edition covers a slew of topics ranging from the Federal Reserve’s loss of influence over capital markets to the AI Sputnik moment in the backdrop of the heated geopolitical contest between the US and China. He wraps up by highlighting the importance of personal brands as the core engine of distribution and his ongoing work at All-In and 8090, an AI-enabled software factory designed to produce high-quality, well-maintained enterprise software.
Managing your career
10 things I learned from 10 years at Figma (13 minute read)
First marketer at Figma who stuck around for 10 years (wowza) shares their learnings riding the wave. Hard to distill all of these down into a single TLDR. But if I had to summarize - there are no playbooks, trust your instincts, don’t let metrics replace thinking, don’t spend too long planning, just do the thing.
Most opportunities in life are replaceable. That’s not a bad thing. It gives us the freedom to try, to fail, to move on, especially in a world optimized for scale and copies with simply different branding. But some things aren’t. Some people, some companies, some moments… Are not just another version of something else. They’re the version. The only one. It’s a strange intangible thing you feel more than see. It’s also easily dismissed because generally, so few people get to experience it, so few of us know what it looks like when it’s happening. Those of us who do know have developed a taste not for what’s popular or well-packaged, but for what’s real and truly unique.
If you are useful, it doesn’t mean you are valued (2 minute read)
As you progress in your career, understanding the difference between being useful and being valued is very important. Being useful means that you are good at getting things done in a specific area, so that people above you can delegate that completely. Being valued, on the other hand, means that you are brought into more conversations, not just to execute, but to help shape the direction. If you’re valued, you’ll likely see a clear path for advancement and development, you might get more strategic roles and involvement in key decisions. If you’re just useful to your organization but not necessarily valuable, at some point you’ll feel a sense of stagnation. That’s when you need to step back and consider your options.