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Invest Like the Best

Exploring the ideas, methods, and stories of people that will help you better invest your time and money. Learn more and stay-up-to-date at InvestorFieldGuide.com
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Now displaying: November, 2018
Nov 27, 2018

My guest this week is Hunter Walk, the co-founder of Homebrew, a unique venture capital firm. Hunter is a tool builder, having spent his career before venture at companies like Google and YouTube. The topic of our conversation is the intersection of creative expression, technology, human behavior, and problem solving. 

We discuss his time at the company behind the video game Second Life, building tools for creators at YouTube, and why a very hands-on style of early stage venture investing represents an interesting use of his skillset at this stage of his career. 

Please enjoy my conversation with Hunter Walk.

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

1:24 - (First Question) – Background on Second Life and what role Hunter had there

6:10 – The virtual currency system at use in Second Life

9:51 – Measuring how people behaved in this virtual world

12:21 – How closely is the Second Life world mimicking real life

15:13 – The market for platforms that lets people take on creative ventures

17:58 – Investments that interest Homebrew

20:21 – Lessons learned while working at YouTube

28:34 – The idea behind Homebrew

33:44 – How to best describe good problems to solve for

36:10 – The Shadow economy and investing in companies operating there

42:17 – Monetization of attention

47:22 – His interest in fintech companies

54:03 – Major trends of change he’s observed over his first three funds

1:04:13 – What is there take on the state of returns for VC’s

1:09:52 – What is the most common way that founders need help and what advice is more helpful

1:14:35 – Kindest thing anyone has done for Hunter

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Nov 20, 2018

[REPLAY]

Modern Monopolies: What It Takes to Dominate the 21st Century Economy, which explores the platform business model (Uber, Airbnb, Github).  Alex is also the founder and CEO of Applico, a company that he started in his dorm room that is since grown into a huge enterprise that helps startups and Fortune 500 innovate with platforms.  Alex and I talk about history and future of businesses and different types of business models.  There’s a lot in here for investors, entrepreneurs, and historians.  Please enjoy!

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Books Referenced

Modern Monopolies: What It Takes to Dominate the 21st Century Economy

The Systems Bible: The Beginner's Guide to Systems Large and Small

The Master Switch: The Rise and Fall of Information Empires

Zero to One: Notes on Startups, or How to Build the Future

 

Links Referenced

Failed Color App

Applico

 

Show Notes

2:39  – (first question) – Exploring the history of business models from linear to platform.

5:46 – A look at the share of overall business platform companies have taken over

            7:06 - Modern Monopolies: What It Takes to Dominate the 21st Century Economy

7:48 – The potential for platform businesses over the next 20 years

9:18 – Detailing the difference between a linear and a platform business

12:08 – Exploring transaction costs and core transactions across different business models

19:49 – Is the platform business model good for investors and VC’s since so many can get crushed when there’s a sole victor, or is it just for the founders and entrepreneurs.

 24:35 – How the self-driving car is going to deliver more opportunity for consumer consumption

27:15 – Untapped supplies as the opportunity for new platforms and where we could see new openings

30:24 – How consolidated will things become across all platforms

33:16 – How do platform companies create a moat to keep others from replicating their business strategy

37:03 – Are there platform strategies that specifically don’t work

            37:40 - Failed Color App

38:45 – Why complex systems typically don’t scale up and you should think small and easy to get started

            38:47 – The Systems Bible: The Beginner's Guide to Systems Large and Small

40:02 – How the origin of so many larger companies started out small and localized, and why it makes investors more comfortable

41:37 – How Alibaba had to tweak their business model to accommodate the Chinese market

44:07 – Why are the modern monopolies better for consumers

47:52 – Exploring platforms that are asset heavy

49:00 – What do you look for as a VC to determine

52:05 – Alex’s take on whether a platform based company like Uber should be more asset heavy

54:31 – Exploring some lesser known platform businesses that Alex finds interesting

56:18 – If there is a demand in the secondary markets for a product, why don’t the primary suppliers simply raise their prices

57:03 – What Alex’s portfolio of platform-based businesses would look like

58:48 – A couple of most influential books Alex has read

            59:12 – The Master Switch: The Rise and Fall of Information Empires

            59:38 – Zero to One: Notes on Startups, or How to Build the Future and other Peter Thiel books

59:53 – Looking at Applico, how it started and how it become so focused on the platform business model

1:03:56 - Most memorable day for Alex 

1:05:13 – Kindest person to Alex in his life

1:06:10 – What platform opportunities could exist in the financial world

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Nov 13, 2018

My guest this week is Cliff Asness, the managing and founding principal at AQR Capital Management. 20 years after its founding in 1998, AQR manages $226 Billion dollars across a number of quantitatively based investing strategies.

Cliff was an original quant researcher and he has long been one of the financial writers and thinkers that I look to for education and for inspiration.

I distinctly remember reading one paper in particular—value and momentum everywhere—somewhat early in my career and thinking: this is the kind of research I want to do forever.

You can always tell when talking to Cliff or hearing him speak that he just loves researching markets. There is a deep intellectual honesty in his work, and a respect for thinkers at different ends of the market spectrum, from Gene Fama and Ken French, to Jack Bogle, to Dick Thaler and Robert Shiller.

Our conversation is about all things quant—past, present, and future. Cliff touches on many of the big issues facing quant investing and tells some great strong along the way. I hope you enjoy our discussion. Let’s dive in.

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub.

Follow Patrick on Twitter at @patrick_oshag

 

Show Notes

1:47 - (First Question) – Favorite superhero

2:43 – Why ‘Ka nama kaa lajerama’ is part of his twitter profile.

3:38 – How portfolios have shifted the way they use factors in a portfolio

10:15 – What are good questions clients are asking right now

            13:24 – Contrarian Factor Timing Is Deceptively Difficult

15:40 – Does technology impact investing strategy

22:14 – When to share information vs keep it proprietary for clients sake

26:40 – How their research process is governed

31:14 – How they will incorporate machine learning into their process

34:21 – What they will do when red flags show up

37:01 – Wackiest question from a client

41:47 – The Three Sharpe Ratio Strategy

            41:53 – Liquid Alt Ragnarök

48:10 – Does his thinking change when it comes to asset allocation vs portfolio building

            50:17 – Parallels Between the Cross-Sectional Predictability of Stock and Country Returns

            53:01 – Sin a Little

57:14 – Trends in fees and pricing

1:02:43 – Thoughts on private equity markets

1:11:03 – Common attributes of really good researchers

1:13:21 – What is he most curious about right now

1:15:43 – What excites him outside of finance

1:17:00 – How much he discusses his work with his kids

            1:18:35 – The Devil in HML’s details

1:19:36 – Kindest thing anyone has done for him

 

Learn More

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Nov 6, 2018

[REPLAY]

My guest this week is Peter Attia, M.D., whose mission is to understand and improve human lifespan and healthspan (or quality of life).  Reading Peter’s research, you find that there are many similarities between health and investing—ideas like compounding—which we explore in detail.

We spend a lot of time on mind, body, spirit and performance as it relates to living a better life. Of particular interest is the strategic problem that we face when studying longevity. As Peter puts it in our conversation: we are the species of interest, but we can’t conduct the kinds of experiments on humans—randomized trials, with control groups—that we apply to solve other big problems. So we have to back our way into a better understanding of longevity and quality of life.

To that end, we discuss what we can learn from studying centenarians, the problem of progress in science, a drug called Rapamycin (which Peter believes could be revolutionary), eating, the importance of muscle mass, and the idea of distressed tolerance.  We emerge with a framework for thinking about health and well-being which can hopefully help us all live longer, better lives. Please enjoy!

For comprehensive show notes on this episode go to http://investorfieldguide.com/attia

For more episodes go to InvestorFieldGuide.com/podcast

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

Posts From Peter Attia That You Should Read

Do Calories Matter

How You Move Defines How You Live

2016 Update

Long List of Questions Answered: Part 1 and Part 2

Links Referenced

The Scientific Method-Richard Feynman

Knowing Versus Understanding-Feynman again

Books Referenced

Barbarians at the Gate: The Fall of RJR Nabisco

Diffusion of Innovations

Good Calories, Bad Calories

Show Notes

2:31  – (first question) – Getting Peter to define the concept of wealth and how it might have changed in his life

5:01 – How do you increase the number of really good people in your life.

6:50 – Looking at the relationship between healthspan and lifespan and a chart that Peter created on this specific topic.

11:11 – Drilling down into the different dimensions and aspects of this chart that could be most important for people, especially how compounding plays into our health.

16:57 – The difference between strategies and tactics that will help you extend lifespan

17:54 – The Scientific Method-Richard Feynman

21:41 – Different types of intermittent fasting

28:59 – What role does repair play in health

34:17 – Barbarians at the Gate: The Fall of RJR Nabisco

36:01 – Looking back, what health trends today will look absurd

36:19 – Diffusion of Innovations

39:24 – What are the primary benefits of weight lifting

40:21 – The importance of glucose disposal

45:07 – Good Calories, Bad Calories

46:31 – What is the state of progress in the scientific community

52:14 – Peter is asked about how he guards against getting too attached to old beliefs

1:01:51 – A look at how performance relates to healthspan

1:03:34 –Peter’s first great auto-racing experience

1:09:17 – Looking into Peter’s medical practice and understanding his thinking that goes into helping people

1:18:11 – The most memorable day in Peter’s career

1:22:31 – The kindest thing anyone has done for Peter

Learn More

For more episodes go to InvestorFieldGuide.com/podcast.

Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub

Follow Patrick on twitter at @patrick_oshag

 

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