The Austrian Wonder

On this blog I will compose my (semi-)daily trade and market thoughts, which might go horribly wrong, so don't follow any of my advice - or take any of my opinions seriously.

Oh, and the background color is mean to mimic the FT, which I think is the best daily newspaper around.
Feb 12
I read the Financial Times before other people read the Financial Times. Now it’s trendy and everybody carries around a Financial Times
— Barack Obama, US president in an interview with the FT in 2009 (via financialtimes)

Are you serious?? Ridiculous quote

Sep 30

Peter Thiel’s CS183: Startup - Class 18 Notes Essay


Here is an essay version of my class notes. Errors and omissions are mine. Credit for good stuff is Peter’s. Thanks to Joel Cazares for helping proof this.

I. Traits of the Founder 

Founders are important. People recognize this. Founders are often discussed. Many companies end up looking like founder’s cults. Let’s talk a bit about the anthropology and psychology of founders. Who are they, and why do they do what they do?

A. The PayPal Origin

PayPal’s founding team was six people. Four of them were born outside of the United States. Five of them were 23 or younger. Four of them built bombs when they were in high school. (Your lecturer was not among them.) Two of these bombmakers did so in communist countries: Max in the Soviet Union, Yu Pan in China. This was not what people normally did in those countries at that time.

The eccentricity didn’t stop there. Russ grew up in a trailer park and managed to escape to the one math and science magnet school in Illinois. Luke and Max had started crazy ventures at Illinois Urbana-Champaign. Max liked to talk about his crazy attributes (he claimed/claims to have 3 kidneys), perhaps even a little too much. His came to the U.S. as sort of a refugee weeks after the Soviet Union collapsed but before other countries were formed. So he liked to say that he was a citizen of no country. It made for incredibly complicated travel issues. Everybody decided that he couldn’t leave the country, since it wasn’t clear that he could get back in if he did.

Ken was somewhat more on the rational side of things. But then again, he took a 66% pay cut to come do PayPal instead of going into investment banking after graduating from Stanford. So there’s that. 

One could go on and on with this. The main question is whether there is a connection—and if so what kind—between being a founder and having extreme traits.

B. Distributions

Many traits are normally distributed throughout the population. Suppose that all traits are aggregated on a normal distribution chart. On the left tail you’d have a list of negatively perceived traits, such as weakness, disagreeability, and poverty. On the right tail, you’d have traditionally positive traits such as strength, charisma, and wealth. 

Where do founders fall? Certainly they seem to be a bit less average and a bit more extreme than normal. So maybe the founder distribution is a fat-tailed one:

But that radically understates things. We can push it further. Perhaps the founder distribution is, however strangely, an inverted normal distribution. Both tails are extremely fat. Perhaps founders are complex combinations of, e.g., extreme insiders and extreme outsiders at the same time. Our ideological narratives tend to isolate and reinforce just one side. But maybe those narratives don’t work for founders. Maybe the truth about founders comes from both sides. 

Read More

(Source: blakemasters)

Sep 27
Sep 04
Jun 05
May 31