Sunday Snapshots (12/27/20) – Subprime Attention, Vaccine source code, and Mid-sized restaurants

In which I share the last issue of 2020

Hey everyone,
Greetings from Washington, D.C.!

This is the last Snapshots issue of 2020. I’m not quite sure how to describe this year. On one hand, there was tremendous suffering across the world. On the other hand, I was removed from the worst of it. Yes, I had to cancel plans, had a muted college graduation, and my social interactions are severely limited but that pales in comparison to the much more existential problems of millions of people. All in all, I feel incredibly lucky.

Luck has also played a large part in the growth of the Snapshots reader base this year. We grew more than 800% over the last 12 months and I’m convinced we are nowhere close to the steepest path of the curve yet. In part, that has been through my collaborations with Brett Bivens on Spotify, Packy McCormick on Succession/Spotify, Nathan Baschez on Complexity Convection, Ross Gordon on Career Growth, and Jake Singer on Lululemon. In part, it’s been driven by my stubbornness to publish on every single Sunday of the year – it’s the first full year of Snapshots issues and we are now on the 84th consecutive weekly issue. But it’s mainly been driven by readers like you who have shared the newsletter on social media, in their company’s Slack groups, and in direct messages to their smartest friends. So thank you for your generosity and let’s get into the last issue of the year, in which I want to explore:

  • Subprime Attention Crisis by Tim Hwang

  • Reverse engineering the source code for the COVID-19 vaccine

  • Introducing The Golden Age of middle-of-the-road restaurants

  • Amazon’s ambitions, Madhappy’s zags, and The Criterion Collection

Book of the week

I must have missed the memo about me reading terrifying books back-to-back. If last week’s book on The Secret Life of Groceries was the inside track on what we put in our bodies, this week’s book – Subprime Attention Crisis by Tim Hwang – is the inside track on what we put in our minds daily through the ever present black mirrors in our pockets and homes.

This book most closely reminds me of Ryan Holiday’s Trust Me, I’m Lying in that it abstracts away the idea of individual actors and hence avoids the common pitfall of looking at good vs. bad narratives. Instead, it looks at the structural gaps in the current infrastructure of advertising-funded internet.

By building compounding arguments across the chapters, Hwang is able to draw deep parallels between the shaky financial system of the mid-2000s and the programmatic, automated advertising system of 2020 that finances most of the internet.

At the center of his argument is the claim that the very thing that platforms such as Facebook, Google, and numerous other ad networks claim to be selling access to – attention – is increasingly of a low quality as users ignore ads or use some sort of ad-blocking software to circumvent them altogether. This issue is compounded by the fact that algorithmically driven exchanges that do real-time ad placement are notoriously complex and as a result, opaque to conventional understanding.

So, you have an important system that finances most of everything on the internet built on a commodity that doesn’t reflect the underlying asset. Sounds like a recipe for a crisis.

This is the start of an upcoming essay on the book that will be published in early January. If you have any thoughts on the topic, please send them my way by replying to this email.

Long read of the week

Reverse Engineering the source code of the BioNTech/Pfizer SARS-CoV-2 Vaccine

Did you know that you could type out the source of the COVID-19 vaccine? I didn’t!

As the article correctly predicts:

Now, these words may be somewhat jarring - the vaccine is a liquid that gets injected in your arm. How can we talk about source code?

Enter the world of DNA printers, source code, RNA molecules, signal peptides, and spike proteins.

A fascinating read that’ll leaving you questioning whether or not we live in a simulation.

Business move of the week

This section is the start of a longer essay about The golden age of mid-sized restaurants.

The prevailing wisdom in business seems to be to operate at the extremes. Either be a niche poster shop on Shopify and drive sales through branding or be a commoditized product like USB-C cables on Amazon and drive sales through price.

This is largely been true. You’ve seen a squeezing of the middle in everything from media (NYT at one extreme and Substacks on the other extreme), publishing (Amazon on one extreme and self-publishing on another), and in retail.

But there are exceptions. A couple of months ago, I talked about one company powering the powerful middle of retail. This week, I want to switch my attention to another industry – restaurants.

On first glance, there has never been a worse time to be in the hospitality industry. But within the dark clouds of delivery apps and loss of indoor dining are a few streaks of silver. These players are not McDonalds or Dominos with big brand names to flex around, but instead dominate a specific target audience.

Two players that immediately come to mind are sweetgreen and CAVA. While the correct capitalization of their names are diametrically opposed to one another, the strategy similarities between them is remarkable. Let’s go through how they tackle two fundamental questions for any business:

  • How to acquire new customers: While sweetgreen and CAVA certainly grow through word-of-mouth, an important part of their growth is by their ubiquitous presence on every delivery app. This allows casual consumers to try out their offerings and increases top of the funnel growth, even if this comes at the expense of lower margins.

  • How to retain old customers: Their personal apps is the center of their loyalty program. Here at Snapshots HQ, we (I) are fans of Uber Rewards and the Starbucks app (my thread on this went semi-viral). But those are multi-billion dollar companies with tons of engineering and product resources. What sweetgreen and CAVA have been able to do is much more impressive. In particular, an effective cash back rate of 9% on orders ($8 for $88 in spend at CAVA and $9 for $99 at sweetgreen) means that continuing to order through the app and giving them a superior margin rate is a no-brainer for the customer.

This strategy requires them to sufficiently waft off the attention gained on larger delivery apps and build a direct connection to the customer. It’s not for the faint hearted.

More on this in the coming weeks.

Odds and the ends

📦 Inside the Whale: An Interview with an Anonymous Amazonian: What an insane article about 800-pound gorilla that is Amazon. Check it out to learn about how the data migration process is protected by armed guards, what the scale of the company allows it to do, and what Prime Video is a loss leader for.

👕 A Tale of Two Streets: Supreme vs Madhappy by Jerry Lu: I might be bit biased because Jerry is a longtime Snapshots reader and a friend, but this was one of my favorite pieces of the year that I came back to this week as part of my research for an upcoming essay. It’s a case study in how streetwear brands move beyond drop-based exclusivity – where the goal posts are ever changing – and build real community.

🎥 The Cult of Criterion Collection: Enter the deep, dark, and expensive underbelly of Blu-ray movies – The Criterion Collection. So much to learn from this cult favorite and I think that the video does an incredible job of laying out the key points.


That wraps up this week’s newsletter. You can check out the previous issues here.

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