Per My Last E-mail #31
My Five Best, 2020s Predictions, Emerging Trends, 4-Day Workweek, Haidt, Solving the Market, and Trick Mirror
Hi Friends 👋,
Happy Monday! It’s the most wonderful time of the year - Christmas is on Wednesday, the Eagles beat the Cowboys to get one step closer to an improbable playoff berth, and The New Yorker has finally hopped onto the Per My Last E-mail bandwagon. (Good find, NickMo).
This will be the last full-length Per My Last E-mail of 2019. Next week’s (I say this now) will be a little bit lighter. Let’s get to it.
Links & Listens
🙋🏻♂️My Five Best of 2019
Beginning to write in public was one of the things that defined my 2019, so bear with me while I look back for a minute. The five pieces that best represent what I’ve been thinking about this year are:
2. The Rise of the Natively Integrated Company
3. Why There Isn’t a Dominant Aggregator in Online Education
4. Startup Economic Lessons From Shen Yun’s Empire
5. Eight Reasons WeWork’s Downfall is Great for Real Estate Startups
Thanks to everyone who’s read terrible drafts, provided feedback (the harsher the better), argued with me, and just read what I’ve written. The conversations with you that writing has kicked off have been a highlight of my 2019, I’m looking forward to getting better at it in 2020.
🔮 Ten Predictions for the 2020s (1-5) by Alex Danco
Alex Danco has been a fixture in 2019’s Per My Last E-mails - his essays have appeared in this newsletter more than anyone else’s. He’s stretching his lead this week and next, with a two-part 2020s prediction essay to wrap up the year.
Of his first five predictions, one aligns with something that I’ve been thinking and writing about: #5: Higher ed: undergrad will stay the same, but grad school will get blown up
MBA applications have declined five straight years, the way that people distribute their research and writing has changed, and credentials are slowly becoming more about what you’ve produced than where you went. I agree with Danco that these trends will continue, and that the next decade will see a radical transformation in graduate education. As grad school gets unbundled, we will be able to mix the best pieces from many different sources - finance courses from Wharton, job shadowing at Stripe, coding bootcamp from Lambda School, writing classes from Write of Passage, and IRL Member Communities for network-building, meaning, and fun - to build curricula tailored to our goals and interests.
🎱 8 Emerging Trends That Can Help Companies Understand Their Future Consumer by IDEO
IDEO, the global design company, released the results of a survey it sent to all of its offices and studios around the world asking just one question: What emerging patterns are you seeing in your work that few are talking about?
Five of the eight trends relate to topics that I’ve been exploring and writing about:
1. Attention Economy Backlash
2. Multi-Track Mind
3. Distributed Devotion
8. Skipping School
Taken together, these five trends point to the need for IRL Member Communities focused on creating a sense of meaning, building offline connection, and enabling us to continue to learn, grow, and develop outside of traditional institutions.
🗓 What if You Had a Four-Day Week? Why Don’t You? by Niraj Choksi in NYT
We’ve been talking about moving to a four-day workweek for over half a century, but we still end up in the office every Monday through Friday. For most of that half-century, research has focused on employee happiness and well-being, and as a result, the four-day workweek has remained a nice idea that’s almost impossible for a board with a fiduciary duty to shareholders to approve.
But recent studies from Perpetual Guardian in New Zealand last year and from Microsoft last week show that a shorter workweek can actually boost productivity. In Microsoft’s recent trial in Japan, employees who worked four days per week were 40% more productive than their five-day-workweek counterparts.
While the results are counterintuitive - how can you get 40% more done with 20% less time?! - they make sense when you think about the last time you worked under an intense deadline. You shut out distractions, got in the zone, cut out the planning meetings, and just focused on getting the work done.
Imagine a world in which we went to work to do work, spent most of the day in flow instead of meetings, and got the wasted time back to spend on the things we love to do. I’m all for the four-day workweek.
🎧 Jonathan Haidt on Polarization, Social Media and its Effects on Society on Venture Stories
What a way to wrap up Links & Listens in 2019: the author of one of my favorite books of the year being interviewed on my favorite new podcast of the year.
Haidt is optimistic that we can get the internet right - he points out that Thomas Jefferson was worried about the effect of novels on women and that we didn’t have stop signs when cars first came out - but he’s worried about the negative impacts of social media in particular.
According to Haidt, social media amplifies the worst characteristics of human nature and is responsible for the deterioration of Gen Z’s mental health. Gen Z is statistically more mentally unhealthy across the globe. Not only is self-reported depression up, but suicide rates have increased significantly, particularly among teen and pre-teen girls, and social media usage is the most likely cause.
He proposes that the government needs to step in to protect kids and teenagers from Facebook, Instagram, and their ilk. This, coming from the person who wrote The Coddling of the American Mind, which argues that we’re harming America’s youth by overprotecting them. But Haidt argues that social media is different and more harmful than skinning a knee on the playground; we’re not evolved to face the speed, scale, and impact of social media.
In arguing that the government should step in, Haidt invokes John Stuart Mills’ harm principle:
"The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others."
That whole argument takes place in the first ten minutes, and the rest of the conversation is equally thought-provoking, covering fair inequality, radicalization, on-campus activism, identity, and how wokeness is like a quasi-religion. If you need conversation starters for Christmas dinner, give it a listen.
What I’m Reading
Just Finished: The Man Who Solved the Market: How Jim Simons Launched the Quant Revolution by Gregory Zuckerman
Stories about the financial markets have always fascinated me because they operate at a higher level of abstraction than most stories. Liar's Poker, The Greatest Trade Ever (also by Zuckerman), Barbarians at the Gate, When Genius Failed, The Big Short, Reminisces of a Stock Operator, The Handbook of Fixed Income Securities (kidding, don't read this unless you must), Too Big to Fail. The list goes on. Most books are about the things that are happening in the world; these stories are about how a small group of highly intelligent people play those things that happen in the world to make (or lose) oodles of money.
The story of Jim Simons and Renaissance Technologies is so intriguing because it takes us one more level of abstraction above the stories in those books. Renaissance’s Medallion Fund has been the best performing hedge fund for decades, generating an average annual return of 40% after charging eye-watering 5% and 44% fees.
Whereas the heroes of the other financial markets books I’ve listed made their fortunes by trading on the things that happened in the world - the anticipation of the mortgage crisis, for example - Medallion’s computers beat all of them by trading based on how those people, and the millions of others who play in the markets, can be predictably expected to behave irrationally.
Renaissance’s earliest employees were mathematicians, code breakers, theoretical physicists, and other PhDs trained in detecting patterns in noise. At first, when they applied their skills to the markets, they didn’t understand why their algorithms were recommending the trades that they were, just that they seemed to be working. Over time, they realized that their system took advantage of investors’ biases and psychology:
“What you’re really modeling is human behavior… Humans are most predictable in times of high stress — they act instinctively and panic. Our entire premise was that human actors will react the way humans did in the past … we learned to take advantage.”
This is my big takeaway from the book. The most successful trading algorithms in history were enabled by the fact that, no matter how smart or unique each of us thinks he or she is, we ultimately all react predictably to certain types of events. Computers, which lack emotion, are able to take advantage of our very humanly predictable emotions. I’m not sure what the implications of this are, but I’m sure that there are implications.
Currently Reading: Trick Mirror by Jia Tolentino
An odd but perfect follow-up to The Man Who Solved the Market, Trick Mirror is a collection of Tolentino’s essays, all of which, according to Slate, “wrangle with the challenge of arriving at an organic self in an age of pervasive, technology-facilitated phoniness.” I’m only about one-fifth of the way through, but I’m looking forward to digging into two things:
1) whether we can have an organic self when we’re all so predictable, and when technology directs and amplifies our behavior, and
2) as the decade that Tolentino writes about winds down, how did we get where we are, what does it tell us about where we’re heading, and what ability do we have to alter that trajectory?
More to come next week…
After we all sprinted to the end of the 2019 work year, I’m really looking forward to spending two weeks with no meetings, just hanging out with family and friends, eating, reading, exchanging presents, heading to Austin, and thinking. Next week’s e-mail will have some more on what 2020 has in store; for now, I’m excited to unplug and unwind.
My Christmas wish: if you know 1-2 people who would enjoy Per My Last E-mail - friends who are a little nerdy, love a good debate, and are always down for good conversation, please spread the holiday cheer 👇🏻👇🏻👇🏻
Thanks for reading and happy holidays!