Moats, gross margins and strategy sounding fluff

Moats Before (Gross) Margins

so you got to have gross margins, fat gross margins. But you end up doing only software

but you know Apple has not SW margins but it is a good company.

Gotta have moats moats moats, baby

so what are htese moats? Founders feeling the crisp air of the morning while standing on top of the tower and look beyond their moats. The fascination of military metaphors that is strategy 🙂

BTW of course a fixation on gross margin is ok if you have to win the startup race on the internet, everyone will have a go at the next tool, platform, aggregaotor and we know the rules of competition there. But then strategy does not stop there

Moats are just a beautiful, inspiring image

Confirmation bias and New Thought

“By 1890, this stream of religious philosophy had morphed into a set of mystical beliefs in the power of thought to affect the material world beyond the self”

“Elements of New Thought have recently seeped into strategic thinking through literature on leadership and vision”

Excerpt From: Rumelt, Richard. “Good Strategy/Bad Strategy”. Apple Books.

also, confirmation bias from Fooled by Randomness, who has made money feels optimist until maybe they blow, maybe they don’t.

mental habit and DeepL

I have a funny writing habit

when I need to post something in italian I write in English and then translate into english

quando devo scrivere lunghi report di lavoro per i colleghi tedeschi li scrivo in italiano e poi li traduco in inglese

grazie Deepl per aver “materializzato” questo mio mental habit and made it way more efficient

Covid Innovation: a lot, not so great

Covid therapies are entering the pipeline at a rate 15 to 80 times faster than any previous epidemic with over 4 new therapies entering the commercial pipeline every single day

The relative share of “short term” solutions – non-vaccines and repurposed drugs – is unusually high. 23 percent of Covid therapies are vaccines, versus at least half for the previous three recent less severe epidemics. Over 60 percent of Covid therapies are repurposed drugs, versus no more than a quarter of those for Ebola, Zika, or H1N1.

the rate at which new vaccines enter the pipeline is essentially the same in February and April!

The increased entry driven by huge payoffs to any successful Covid therapies causes entrants to inefficiently race toward lower-value therapies. If enough small firms begin to race in this way, even the large firms that otherwise would have worked on vaccines will give up. And note that this pattern appears empirically: more severe epidemic leads to more entry by small firms, more work on short-term projects

Vaccine nationalism

a bit of vaccine news and vaccine nationalism

Moderna all in one day, last Monday, first positive results of trial, collects 1,34 billion in new stocks offering at 30 billion valuation, to be used for vaccine production https://www.fiercepharma.com/manufacturing/moderna-eyes-1-34-billion-stock-offering-to-manufacture-covid-19-vaccine

Sanofi says US will be the first to get vaccine since they invested in it https://www.businessinsider.com/potential-coronavirus-vaccine-united-states-first-french-pharmaceutical-sanofi-ceo-2020-5?IR=T

Advent will give the UK government the first 30 million doses of vaccine co-developed in Italy with IRBM https://www.irbm.com/press-review/london-reserves-30-million-doses-of-the-vaccine-born-between-oxford-and-pomezia-rome/

Let’s zoom out, The EU held a funding conference 2 weeks ago, collecting almost €8 billion. Bill Gates donated but the US was not even there, China attended but did not donate. Neither did Russia nor India attend. The world is divided in 5 blocks, each block has its own vaccine strategy

A beautiful 3d on vaccine and geopolitics by Paul Poast. Vaccine nationalism is a real risk, an aspect of the power politics of pandemics https://twitter.com/ProfPaulPoast/status/1257642933949476866

In the general uncooperative and nationalistic stance on Covid and vaccine, a country like Italy, biggest pharma producer in EU, should bet on one or more vaccine candidates and start building productive capacity. It would be an effective industrial policy and would give more chances to get the vaccine early.

Will we grab a few billions off the ESM and invest it? Or will we wait for the EU to ivenst its own 8 billions and dictate the strategy?

 

 

 

The season of our technologies

Crypto Winter A16z The Crypto Price-Innovation Cycle by Chris Dixon and Eddy Lazzarin Note how the technology winter is the environment where we  find the bear markets

Last week Ben Evans The VR Winter

In the origins it was the AI Winter, set off by Minsky’s comments in 1969 on perceptrons unable to reproduce the XOR operator

Now is the winter of our discontent

The suggestion of the original AI Winter in the 70’s came from the Nuclear Winter “The term was coined by analogy to the idea of a nuclear winter.[2] The field has experienced several hype cycles, followed by disappointment and criticism, followed by funding cuts, followed by renewed interest years or decades later.” https://en.wikipedia.org/wiki/AI_winter