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
“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.
1. some says the stock market has matured, all blue chips company are pretty much well managed, so it does not really matter picking the right one, so passive investing
2. But some other noted that if you take out the value created by a 4% of high-performers the rest of the pubblic companies just thred water, so pick thos 4% and grow rich. So pick the google and facebook early. Buy a crystal ball
3. Or just get into any seed round you can, because someone says this is the best way to gt into those winners
1. would Maubouissin in this paper The Incredible Shrinking Universe of Stocks
2. would be The best-performing four percent of listed companies explain the net gain for the entire U.S. stock market since 1926, as other stocks collectively matched Treasury bills
3. is Angel List If you miss the best-performing seed investment, you will eventually be outperformed by someone who blindly invests in every credible deal.
Moats & Trenches
“Voleva sapere che cosa c’entrassimo noi in quell’articolo e supponeva fossimo mandatarii di potenti concorrenti esteri. La prima volta era sconvolto e temeva il peggio. Quando indovinò la nostra ingenuità, ci rise in faccia e ci assicurò che non saremmo riusciti a nulla. Finì ch’ebbe ragione, ma prima che ci acconciassimo alla condanna durò non poco tempo e da Carmen furono scritte non poche lettere. Trovammo che l’articolo era irraggiungibile perché circondato da trincee.” La Coscienza di Zeno, Italo Svevo
“The most important thing [is] trying to find a business with a wide and long-lasting moat around it … protecting a terrific economic castle with an honest lord in charge of the castle,” Warren Buffet
Ancora nella Coscienza di Zeno: cut the loss soon let the profits run
“Curioso come a questo mondo vi sia poca gente che si rassegni a perdite piccole; son le grandi che inducono immediatamente alla grande rassegnazione.”