Sunday Snapshots (22nd September, 2019)

Clarity vs. Mystery, Quantum computers, Bill Gates, and South Indian food

Hey everyone,

Greetings from Evanston.

It’s been a relaxing week of setting up my new house, spending time in Chicago, and figuring out what I want to do after graduation. It’s so rare that I get uninterrupted time to reflect on the past and consider the future. I’ve also had many long, uninterrupted conversations with my friends who have moved in over the week.

This week, I want to talk about:

  • Design, Clarity, and Mystery

  • A request for your advice

  • Quantum computers and longshot bets

  • Bill Gates, Ambition, and PR

  • And more!

Personal update of the week

I start my final undergraduate year of college this week. If you spent any time at a university, I have a question for you:

What did you do at college that you most regret or what didn’t you do that you most regret?

Just reply to this email to answer.

Book of the week

After reading a long biography, I like to break things up with a couple of smaller books. I was at the amazing Open Books in West Loop and picked up Chip Kidd’s Judge This. Chip Kidd is a book cover designer who don’t like the motto “don’t judge a book by it’s cover.” He argues that “design, by its very nature, demands to be judged when you initially encounter it” and it’s his job to make sure that that first impression is great. The biggest takeaway from the book is the concept of the “Mysteri-o-meter.” Every design can be rated on a spectrum of absolute clarity to absolute mystery. Which one you want to optimize for depends on the task at hand. If you’re designing direction signs for the subway, clarity is obviously way more important. On the other hand, if you’re designing a poster for a movie, maybe a little bit of mystery isn’t so bad.

Kidd goes through different designs and uses this framework of clarity vs. mystery to evaluate them. Occasionally, he’ll redesign them. These are my favorite parts of the book. He also discusses some of his own work.

It’s not a must-read but a good book to flip through on a train ride or flight.

Business move of the week

Google claims to have reached quantum supremacy

Massive value is created and destroyed when the assumptions of doing business are changed. An example of such a paradigm shift is the zero marginal cost of serving another customer on the internet.

This week, Google allegedly took an important step towards such a paradigm shift – cracking the mysteries of quantum computing. Their processor computed a calculation in three minutes and 20 seconds that would have taken the world’s most powerful classical computer approximately 10,000 years to do.

That’s 0.00000006% of the classical computer time! While the researcher note that this was a technical calculation and that application of quantum computers is still years – if not decades – away, this is an important milestone.

If you have more than $100B in liquid cash reserves, these are the longshot bets that you should be working on. I think there is something very neat about the idea that all of us are funding this research through our interactions with Google every day.

Random corner of the week

Taking about longshot bets, I watched the Bill Gates documentary that came out last week. It’s a 3-part exploration of the work done by the Bill and Melinda Gates Foundation, through the . I actually think the documentary was pretty impartial and the interviewer pushed Gates when his answers were not satisfying.

Here were my three takeaways from the series:

  • Don’t trust the report: Last year, I read Rich Cohen’s The Fish that Ate the Whale, a biography of Sam Zemurray of the United Fruit Company. Sam was famous for visiting the banana fields in Latin America himself to ensure that corrupt executives were not distorting results. In a similar way, Gates goes straight to the source of the knowledge. When he’s lobbying states to adopt his solutions, he reads boring thousand-pages long state budgets. When he wants to learn about sanitation in the developing world, he reads the World Development Report and supplements that with visits to the countries he’s concerned about. If one of the most influential people in the world can do the grunt work, then so can all of us.

  • Complimentary strengths in your partner: The dynamics between Bill and Melinda Gates was an under-explored part of the documentary. Melinda seems to have an analytical mind with a bent towards the human interaction piece of solutions. That’s different than Bill, who has is still a programmer at heart and looks at solutions in terms of scalability and utility. Every partnership must have complementary strengths, and the Gates family definitely has it figured out.

  • PR turnarounds: Whoever worked with Bill Gates to change his public persona from a ruthless monopolist to a philanthropist working on improving the lives of the bottom 10% of the world’s population needs to get a raise. While it’s true that Gates has done incredible work in developing countries, many rich people do that but don’t get the goodwill that comes with it. The Gates family does.

  • Ambitious, even for Bill Gates: Towards the end, the interviewer asks Gates a question: “Have you taken on projects that are too ambitious for you?” Things like re-inventing nuclear energy, ensuring clean sanitation, and eradicating polio. That struck as a very powerful question. Things are not a cakewalk, even for Bill Gates.

I definitely recommend the documentary series.

Meal of the week

When you think about Indian food, you probably imagine a nice tomato-based curry and a naan. That cuisine from the northern part of the country. While I swear by the fact that North Indian food is way better, I definitely enjoy South Indian food. My dad grew up in the southern state of Kerala, so he loved going to South Indian restaurants and even cooking it at our house.

Here in the US, South Indian food is rare. So when I learned that there was a spot in West Loop where you get a satisfying South Indian meal, it was a no brainer for me. Thattu in Politan Row on 111 N Aberdeen St is an amazing food stall run by a lovely couple who will greet you with the biggest smile.

I had the Chicken Coconut Curry, Appam, Ghee Rice, and Fried Chicken. Amazing food, definitely worth a visit.


That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,

Sid

Sunday Snapshots (15th September, 2019)

JFK and the Cuban Missile Crisis, Street designs, Botanical Gardens, and Apple Sign In

Hey everyone,

Greetings from Madison, Wisconsin! I’m here visiting one of my oldest friends, Devang. Since I moved a lot when I was kid, it was difficult for me to maintain lifelong friendships. I got to know Devang in Manila, then he joined me in boarding school in India, and now he goes to college just a 3 hour bus ride away. Our families are as tight as us – our mothers lovingly call each other “sister.” It’s been a fun weekend of recounting the stories during the years when we were both awkward kids just trying to fit in.

This week, I want to talk about:

  • JFK and the Cuban Missile Crisis

  • Simulating people-first street designs

  • Chicago Botanical Gardens

  • Apple’s masterstroke to disrupt Google and Facebook

  • Cheese curds

  • And more!

Book of the week

This is the last week of talking about JFK. He’s a complex figure who is viewed through the lens of his charisma and his assassination in 1963. The latter gives the title to Robert Dallek’s An Unfinished Life: John F. Kennedy. Having finished this book, three things stand out to me:

  1. His health: JFK was diagnosed with Addison’s disease in 1947 when was 30 years old. For these 30 years, he had intermittent crippling pain throughout his body. He even took hormonal steroids as a result of various misdiagnoses, probably exacerbating his Addison’s. He spent years in the Navy without letting anyone know – we only know about his superhuman stoicism through his letters to his friends. Even as president, his health was a closely guarded secret and he operated effectively in situations that required extraordinary resilience and would have broken a lesser man.

  2. His decision to go into politics: JFK wasn’t groomed to be in politics. That would have been his elder brother Joe Kennedy Jr. But when Joe died during World War 2, JFK became the eldest son of the Kennedy family. The patriarch Joe Kennedy Sr. had already amassed a fortune through his time as a merchant and then later through his government work. There was little point in adding to a multi-million estate. Therefore, JFK was pushed towards a more noble profession that was looked at as ideal for a second or third-generation immigrant like him. He definitely did some post-decision justification:

    I saw how ideally politics filled the Greek definition of happiness: "A full use of your powers along lines of excellence in a life affording scope."

    Our parents shape us all in good and bad ways. In some cases, parental pressure means choosing a stable job over a risky one. In this case, parental pressure meant giving America its 35th President.

  3. Cuban Missile Crisis: Perhaps the most shining moment of the JFK presidency was his role in the Cuban Missile Crisis. At a time when his military advisors suggested war with the Soviets for their transgression in placing nuclear weapons in Cuba, he absorbed the pressure and remained balanced. His ability to withstand the pressure of his advisors meant that the world didn’t slip into nuclear winter.

    In the days leading up to the crisis, he was giving away copies of Barbara Tuchman’s The Guns of August to everyone at the White House. The book is about the series of events that led to the World War 1 and how leaders in various states didn’t do enough to stop the buck when they could have. What followed was less a war, more a human meat grinder featuring trench warfare, the lost glory of war, and the seeds of the Third Reich.

    Kennedy was determined to not make the same mistake. He even left the room at times so that the military advisors could left off some steam and essentially bad mouth their commander-in-chief. There was a strong sentiment that Kennedy was just a “pretty boy” and didn’t know enough about military affairs to lead effectively. It’s this image that lead Nikita Khrushchev to underestimate Kennedy and put missiles in Cuba.

    Ultimately, Kennedy’s deftly named “quarantine” stopped the construction of Soviet missiles in Cuba. Nuclear winter was averted. Not bad for a “pretty boy.”

JFK was a flawed human. His numerous affairs and mistreatment of Jacqueline Kennedy are well documented. Like any president, he would had a complicated legacy if not for his assassination. He is seen through the lens of his assassination as much as Lyndon Johnson and Richard Nixon are seen through the lens of Vietnam and Watergate, respectively. In JFK’s case, the lens are a lot more rose-colored than his successors.

After reading about him for the past four weeks, it’s difficult to say whether I like JFK. I’m certainly in awe of him.

I highly recommend Dallek’s An Unfinished Life if you’re interested in the life of JFK, his presidency, and his legacy on American politics.

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Long read of the week

Simulations on people-first street designs

Sidewalk Labs is Google’s urban innovation organization that is reimagining how cities should look like.

Earlier this year they released four street design principles:

  • Principle 1: Tailor streets for different modes.

  • Principle 2: Separate streets by speed.

  • Principle 3: Incorporate flexibility into street space.

  • Principle 4: Recapture street space for the public realm, transit, bikes, and pedestrians.

Of course, they can’t advise cities with just amigious principles. Any principle must be backed with lots of data when billions of dollars are at stake.

So they ran two simulations:

  1. The base case: A simulation of a city block roughly one-fifth of a square mile big. They limited driving speeds to 40 miles per hour and assumed 70% of people traveling in this simulation would drive their own car. This reflects the average city block so it serves as a base case for any and all improvements.

  2. Their proposed design: This simulation incorporated their suggestions – prioritizing different modes of transport for different lanes on the roads, separating streets by speed, having dynamic curb spaces depending on the time of the day, and building spaces for public and transit use.

The results?

  • Throughput – the number of people going through the city block over a given time – remained the same for the proposed streets.

  • The proposed streets had lower average speeds. This makes sense given the segregated lanes for different modes of transport.

Read the article to see more detailed takeaways, along with some pretty neat GIFs like this one:

Personal highlight of the week

In addition to traveling to Madison, I also got the opportunity to visit the Chicago Botanical Gardens in the northern suburb of Glencoe earlier this week.

It’s been a real grind of a summer, so it’s finally good to kick back and relax. There is not a better way to do that than spending time in nature with friends. Thanks to my friend Idan (and recent Snapshots subscriber) for showing me around.

If you’re visiting Chicago during the summer or spring, I highly recommend the Chicago Botanical Gardens. You can take a Metra train from downtown and be there in less than an hour.

Business move of the week

Sign in with Apple (WSJ)

Disclaimer: This is my analysis of Apple Sign In. If you have thoughts that don’t agree with this take, please reply to this email and let me know. I’m curious about the magnitude of this move.

This is a masterclass in disrupting your competitors core business by leveraging your own core competencies. Apple Sign In basically creates new phantom emails for every service a customer uses on an iOS device. That’s important because Google and Facebook make most of their profits through ads that have specific attribution rules. For example, if you click on a GrubHub ad on your laptop today, any GrubHub purchase in the next 30 days on your desktop will be attributed to that ad. You can change that attribution window (make it 7 days or 60 days) and could even do some cross-device attribution.

But with Apple Sign In, two things break:

  1. Discontinuity in user history: Presumably, by using Apple Sign In, you’ll create a discontinuity between your historical activity on an app and your future activity. This creates all kinds of issues for analysts trying to calculate ROI on marketing campaigns, accurate LTV:CAC ratios, and precise targeting information. Google does some of this, Facebook does a lot more. Google’s offerings are also more diversified and have stronger lock-in – you’re not going to get a “Sign with Apple ID” option for Gmail any time soon, if ever. Ultimately, I think the moat of exceptional ad targeting by Google and Facebook will mean that companies will actually opt-out of allowing Apple Sign In, but in general I would say that Zuck has a lot more to worry about than Pichai.

  2. Few defections affect the entire network: One of the core reasons why Google and Facebook allow users to sign in using their credentials is to build a user profile. Did you start using Tinder after a 6 month break and are also listening to Sam Smith on Spotify (both allow for Facebook log-in)? You’re probably going through a breakup and Facebook can target products to you accordingly. Even if one of these nodes in this network of services breaks, you have a much foggier picture of what’s happening. So you don’t even need everyone to adopt Apple Sign In, even if a few defections decrease your ability to successfully target ads.

Companies that need to re-target their existing customers on a regular basis will try to shy away from using Apple Sign In. Even though it’s good for the customer, companies have too many incentives to know their customer in detail. Apple Sign In breaks that. In anticipation of this, Apple is using its platform power to force developers to offer Apple Sign In:

Apple’s newest developer guidelines require any apps that offer a social sign-in to also implement Sign in with Apple. As of last week, new apps submitted must offer the button. Existing apps and app updates must follow by April 2020.However, with strict guidelines for the App Store means not allowing Apple Sign In is equivalent to not getting access to more than 50% of the US population on mobile.

What’s stronger – incentives to know your customer or lock-in of the iOS platform? I suspect the latter, but it remains to be seen how this plays out in the coming months as Apple rolls out iOS 13.

Random corner of the week

How do you create art using algorithms?

Ask Tyler Hobbs.

He consistency puts out beautiful designs which you can check out on his website.

What stuck out to me about this video was how even though all his artwork is generated by algorithms he writes on a computer, his process still starts from his notebook. I’ve found that there is no better medium that forces you to ask the fundamental questions about any type of work like “What’s the purpose of this?” and “Who is this for?”

Go check out some of Tyler’s work!

Meal of the week

The meal of this week of course involves cheese curds. This was at Graze right next to the State Capitol building. It’s a great breakfast spot to try out if you find yourself in Madison.


That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,

Sid

Sunday Snapshots (8th September, 2019)

JFK and WWII, Predicting Bitcoin prices, and Men's grooming

Hey everyone,

It’s an overcast night in Chicago and I’m enjoying being curled up inside after a long summer. I wrapped up my internship at SpotHero this week (more on than below) so I’m taking this weekend to recharge before gearing up for my last year at Northwestern.

This week, I want to talk about:

  • JFK and World War II

  • Predicting Bitcoin prices using machine learning algorithms

  • Men’s grooming and DTC companies

  • Large, cheap meals in Lincoln Park

  • And more!

Book of the week

This is my third week of dissecting An Unfinished Life: John F. Kennedy by Robert Dallek. This week, I read about his time in the navy as a captain on PT (patrol torpedo) boats. There are two themes I noticed:

  1. “In human affairs, the public must be offered a drama.” – FDR

    JFK was involved in an accident in the Pacific theatre of World War 2 where he had to rescue himself and his crew members. This heroic act received a lot of press back in the US. It was the perfect story of egalitarianism – a member of a prominent family risking his life alongside everyone else in service of his country. It was undoubtedly a coup for his later political life. The story is similar to Churchill’s escape from the Boers in South Africa.

  2. Developing empathy with his countrymen

    In the last couple of weeks, I’ve written about how JFK had an incredibly privileged upbringing. Being on deployment was his first taste of the real world. The huge human cost of the war was not lost on him. In a letter to his parents during that time, he wrote:

    All the talk about “billions of dollars and millions of soldiers” made “thousands of dead” sound “like drops in the bucket. But if those thousands want to live as much as the ten I saw on my boat – they should measure their words with great, great care.

    The war was certainly extremely influential in forming Kennedy’s perspective on conflict. This averse to unnecessary human loss became critical when he was the linchpin in hair trigger situations like the Cuban Missile Crisis.

Long read of the week

Are Bitcoins price predictable using machine learning techniques?

Short answer – not really. There are three reasons why:

  1. Lots of noise: The reason why this is a difficult problem to solve for is the average standard deviation of closing prices is larger than $3000. That’s a lot of noise in the dataset to train a specific algorithm.

  2. Lack of data: There’s also not that much data to behind with. If we start from 2009, it gives us 10 years times 365 days or 3650 data points. That might sound like a lot, but it’s not enough for a predictive model, especially one with so much volatility.

  3. Usefulness of the signal: Add to this the fact that for most of it’s history prices were much lower than the last 3 years, you get rid of the most meaningful signals.

Data and fancy techniques can only do so much.

Personal update of the week

I wrapped up my internship at SpotHero this week. It was amazing experience. As a Business Intelligence Intern, I was able to get exposure to multiple teams across the company and learn a lot from them. More specific lessons I learned from my summer to come soon. Here’s a photo from my last day with my boss, Kate:

Business move of the week

When you’re ready to move beyond Irish Spring

The thesis behind this NYT piece is that Men’s grooming is due for disruption by direct-to-customer (DTC) companies. I worked at a startup in this space last year and I’ve talked to several people who are starting companies serving this customer.

Here are my thoughts on the space:

  1. Product categories and go-to-market strategy:  If you look at industry reports on this space, two product categories stand out – deodorant and razors. Deodorant by itself is almost as big a category as the rest of men’s skincare combined. Effective go-to-market strategies start with one “hero” product that the company becomes known for, then drives incremental revenue through other products. Ex: Harry’s (razors first, now skincare), Native (deodorant first, now skincare), Hims (ED medicine first, now skincare). This is because of the customer behavior – it’s extremely difficult to get the CVS shopper who buys Irish Spring in bulk to try skincare products. You’ll end up emptying your bank account on over-priced keywords and Facebook or Instagram ads. Much better to give them a better version of something they already use over a sustained period of time (possibly with tight margins), develop a brand relationship through email marketing, then up-sell with higher margins items like face wash, etc.

  2. Untouched segment: An interesting customer segment that is extremely underserved is 30-45 year olds. While the customer segment of the rich, young adult on the coast does exist, most 20-30 year old men simply don’t think about skincare – it’s an afterthought. However, once you hit 30, you start to see the first signs of aging – hangovers last longer, maybe a few silver hairs, etc. It’s also when a lot of people become more conscious about their age. Their default choice right now is Kiehl’s. I think there is an opportunity here.

  3. The 800-pound gorilla and logistics: One part of the space that founders don’t pay a lot of attention to is logistics. The average order value for skincare products is around $20-30. Customers expect (expectations are shaped by Amazon) that they will get free, 2-day shipping. That’s incredibly expensive and cuts into 20-30% of the typical 50-70% margins. This is why I’m so excited about Shopify’s fulfillment project – I wrote about it back in June. It levels the playing field for new companies without the expertise to build a 2-day fulfillment network. It’s tempting to sell through Amazon to solve this problem, but for a DTC company in this space, Amazon is like an anaconda that will slowly squeeze your breath (margins) out.

As for the Men’s grooming space, I think it’s an attractive space but it needs exceptional execution to be successful. The margins of error are small. Let me know if you disagree by replying to this email. I’d love to learn about your perspective.

Meal of the week

Do you like a lot of food for not a lot of money? Me too. If so, Pasta Bowl in Lincoln Park is must late-night spot. Their bruschetta was delicious and the huge portion of their pasta ensured that I got 3 meals for the price of one.


That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,

Sid

Sunday Snapshots (1st September, 2019)

Scaling issues, predicting hits, the delivery wars, and Peloton

Hey everyone,

I hope all of my readers in the US and Canada are having a relaxing Labor Day weekend, and, as always, a happy normal weekend to everyone else!

This week I want to talk about:

  • JFK, scaling issues, and privilege

  • Predicting hit songs using machine learning

  • How restaurants think about delivery apps

  • Peloton’s S-1

  • And more!

Book of the week

We continue to talk about An Unfinished Life: John F. Kennedy by Robert Dallek. This week, I read about his early adolescence and college years at Harvard. Here are three themes that stood out to me.

1) Scaling issues: JFK’s father had a meteoric rise from a small time merchant to one of the most powerful people in the United States. As is often the case in scaling fast, there were some issues. The Kennedys, especially Rose Kennedy (JFK’s mother), faced a tension between their religious education and the comfortable existence opened to them.

2) A life of privilege: JFK lived a luxurious life. He took frequent trips to Europe during his college years, staying at opulent palaces and houses. When it came to writing his Senior thesis about appeasement in 1930s England, his father put him in touch with embassies across Europe where he spent significant time touring. Talk about a leg up in life!

3) Generalists: At Harvard, JFK was a generalist. Even though he didn’t do well in his classes, he developed an interest in contemporary affairs:

One classmate remembered that JFK was able to answer between 50 and 60 percent of the questions on the popular radio quiz show Information, Please, while he himself could only get about 10 percent of them right. He became a regular subscriber to the New York Times, reading it every morning. He also began a lifelong fascination with the writings of Winston Churchill.

I’ve been really enjoying this biography. More on it in the coming weeks.

Long read of the week

Song Hit Prediction: Predicting Billboard Hits Using Spotify Data

Researchers at University of San Francisco claim that they can predict whether a song is going to be a Billboard hit with 88% accuracy – that’s really high! The performance is more impressive when you consider that the dataset they used contained 1.8 million tracks, out of which 12,000 tracks or 0.67% of the total track were Billboard hits. That’s a serious “class” imbalance in the dataset. The researchers used four different algorithms and 27 features or characteristic of the songs to predict which ones were going to be hits.

To evaluate the four algorithms, they used three measures – accuracy, precision, and recall. Here’s what they mean:

1) Accuracy means what % of the data was correctly classified as a hit or not a hit. This is a typical measure to look at when evaluating performance of an algorithm.

2) Precision means what % of the data was actually a hit out of all the data predicted as a hit. Precision is important when you don’t want false positives. For example, you don’t want a music label to invest in a song which is unlikely to become a hit.

3) Recall means what % of the data was predicted a hit out of all the data that was actually a hit. This is helpful when there is a false negative. For example, the music label doesn’t want to miss out on a hit that was predicted as a non-hit.

Typically, there is a tradeoff between precision and recall. The direction you skew your results depends on your use case. For example, you might want to favor precision in email spam filters since if non-spam gets classified as spam, you might lose important information. On the other hand, if you’re a venture capitalist, you want to favor recall as you don’t want to miss out on the next Uber!

This is a great paper if you’re just starting to learn about machine learning since it discusses most of the common classification algorithms, evaluation techniques, and nuances associated with the process of transforming a business question into a business answer through data analytics.

Business move of the week

Domino’s Pizza Goes It Alone on Delivery

Whenever you outsource some part of the customer experience, there is a risk associated with how that affects your brand and your bottom line. Usually companies will outsource something that is not their core competency.

Food delivery companies have a simple business proposition – we will take a revenue cut from the orders delivered through our app but will expand the demand of your business. Restaurants get to decide whether the tradeoff is for them.

Dominos has decided it’s not for them:

Domino’s Pizza Inc. is one of the largest chains to stay off the new third-party delivery apps altogether. The company relies on its own employees to make deliveries from its 6,000 U.S. stores and most of its 11,000 international ones, and it runs its own online-ordering app. Chief Executive Ritch Allison said the profit hit and reputational risk of working with delivery companies isn’t worth the extra sales.

Owning the customer relationship is also important to them:

Executives were also reluctant to surrender control of the customer data that they use to target consumers with marketing based on their past orders.

It’s a delicate balance, one that companies will scramble to figure out in the next few years.

IPO of the week

Peloton S-1

Fitness startup Peloton released their S-1 filing last week. Despite being the victim of probably the funniest thread ever, it’s a pretty solid business!

A company can be thought of as a bucket of liquid with a hole at the bottom. You can have liquids (types of customer) flowing into the bucket (growth) and liquids going out of the bucket at the bottom (churn).

In this model, you have four levers to pull:

  • Change the type of liquids flowing in or out (attract better customers)

  • Increase the flow of liquids into the bucket (attract new customers)

  • Decrease the flow of liquids out of the bucket (reduce churn)

  • Change the bucket (play in a new market)

If I apply this model to Peloton, the thing that stands out to me the most is the decreasing CAC and corresponding increasing engagement (screenshot from the S-1).

Startups typically have low Customer Acquisition Costs (CAC) when they start out. This is confusing because you’d guess that it takes a lot of money and effort to get the initial momentum of users going. While that may be true, your first users are going to be users who really like your product and probably took little convincing (read: marketing dollars) to try it out. As your customer base grows, you’ll attract customers that will require more marketing dollars to use your product. This typically means that later customer cohorts have lower engagement rates.

For Peloton, it’s the exact opposite. Later cohorts are more engaged – do more workouts per month on average – than earlier cohorts. They’ve been able to grow with better customers than before flowing into the Peloton bucket. This combined with low churn rates makes them a force to reckon with in the fitness space.

Meal of the week

This is a bit of a blast from the past from my favorite ramen shop – Ivan Ramen in NYC. Ivan Orkin’s restaurant is the most consistent ramen experience. I like the Pickled Daikon and the Chicken Paitan Ramen.


That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,

Sid

Sunday Snapshots (25th August, 2019)

JFK Part I, Serendipity, and 747s

Hey everyone,

It’s been a very busy week so this Snapshots is a bit shorter as usual. SpotHero, the company I’m interning for this summer, announced its Series D funding of $50M on Thursday. The company is well-poised to take advantage of rapidly shifting trends in the mobility landscape. I’m grateful to be a small part of the SpotHero journey.

This week, I want to talk about:

  • An experiment and JFK

  • Algorithms that optimize for serendipity

  • 747s and kids

  • And more!

Book of the week

I started reading An Unfinished Life: John F. Kennedy by Robert Dallek. I’m going to talk about the takeaways from this one over the next few weeks (probably 4 parts). This multi-part section is an experiment, so let me know what you think.

The thing that stuck out to me in the first 100 pages was how much JFK’s childhood was formed by his father, Joseph P. Kennedy Sr. who was conscious of his immigrant background and was an extremely successful businessman. He comes across as a typical helicopter parent before the advent of the word.

That must have left a mark on JFK’s psyche. More on come on this in the coming weeks.

Long read of the week

A serendipity-oriented greedy algorithm

Most recommender systems suggest items that are popular among all users and similar to items a user usually consumes. As a result, the user receives recommendations that she/he is already familiar with or would find anyway, leading to low satisfaction.

Anyone who has spent a long time looking for something to watch on Netflix is familiar with this problem.

The solution:

To overcome this problem, a recommender system should suggest novel, relevant and unexpected i.e., serendipitous items. In this paper, we propose a serendipity-oriented, reranking algorithm called a serendipity-oriented greedy (SOG) algorithm, which improves serendipity of recommendations through feature diversification and helps overcome the overspecialization problem.

If you have an intermediate understanding of set notation and computational complexity, I highly recommended the paper.

Gesture of the week

Flexport CEO Ryan Petersen invites a 13-year old kid to a tour of the company’s new 747. Reminds me of this gesture by the Qantas CEO.

Meal of the week

This week, I went to Aba in West Loop. It’s a great spot – we had the Shrimp Scampi, the Muhammara spread, the slow-braised leg of lamb, and the Grilled Chicken Kebab. While the food was good, I think the layout of the restaurant (with a rooftop patio) itself stood out as exceptionally inviting.


That wraps up this week’s Sunday Snapshots. If you want to discuss any of the ideas mentioned above or have any books/papers/links you think would be interesting to share on a future edition of Sunday Snapshots, please reach out to me by replying to this email or sending me a direct message on Twitter at @sidharthajha.

Until next Sunday,

Sid

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