20 | Throwbacks, Stories, and Ann Miura-Ko

Storytelling dominates reality


#20. Same thing, different week, keen to share what I’ve been consuming! As Ronnie Coleman the king would say:

Everybody wants to be a bodybuilder, but nobody wants to lift no heavy-ass weights.

Here’s the format of today’s email:

  • Part 1: Throwbacks

  • Part 2: Stories

  • Part 3: Under the Spotlight: Ann Miura-Ko

  • Part 4: Bonus Quirky Content - Something to Read, Watch, and Listen.


I cannot tell you the number of times I’ve sent a newsletter out, only the next day to find an incredible link that would’ve been perfect. So this is my chance to make up for that!

Longevity - The Century Club [Link]

The longevity of companies (more focused on Japanese businesses) was covered in issue #3. But Chris Mayer (@chriswmayer) helps further break down from Lessons from Century Club Companies by Vicki TenHaken. Here I am, a newsletter, summarizing a post, that summarized a book. Summaryception.
Anyway, there are 5 common themes in business longevity:

  • Strong corporate mission and culture: They tend to be financially conservative, value profitability over growth, and they have a strong sense of purpose as a company.

  • Unique core strengths and change management: They show a willingness to change and innovate, and don’t rest on their laurels. They also tend to have offerings that are difficult to copy and have a strong appeal other than price.

  • Close relationships with business partners: Long-lived businesses tend to have long-lived relationships with suppliers and customers.

  • Long-term employee relationships: Self-explanatory.

  • Active members of the local community: They’re visible in their community and willing to help out with various causes.

Want the real secret sauce? Invert.

if you invert everything, you get an intuitive picture of what won’t last: companies having an ill-defined purpose with lots of financial leverage, low profits, lack of innovation, easy to copy products, short-term relationships with vendors and customers, lots of employee turnover and one that repeatedly turns the cold shoulder on its community.

Now get out there and build a 100-year-old company!

Roaring Eighties [Link]

I originally spoke about 1980’s Japan in issue #13. And this article on Japan’s roaring eighties really confirms what a weird, whacky time it was then.

Some of my favourite absurdities from the article:

  • Department stores devoted entire floors to buying and selling stocks and real estate.

  • A golf club membership bubble developed with over 20 clubs in Japan costing >$1 million to join and the total value of country club memberships estimated to be $200 billion in the late 1980s.

  • Gang leader Susumu Ishii had a 50x return on his investment fund in 1987 and used the proceeds to build a new headquarters at a cost of $113,000 per square meter.

  • The Bubble Lady, Nui Onoue, was a waitress turned restaurant owner who borrowed an estimated $2 - $3 billion in 1987 to speculate in the stock market and became the largest single individual stockholder of many of the largest companies in Japan. She was also a member of a Buddhist cult and would hold all night séances [a seance is a meeting where people attempt to make contact with the dead, especially through the agency of a medium, for people who didn’t know like me] to summon spirits to help her with speculation. She would then tell brokers which stocks to promote the next day and they would oblige. She went bankrupt in 1991 and was left owing $3 billion when the market crashed.

I legit have no words for all this. Does “I can predict the movement of heavenly bodies, but not the madness of crowds” fit in this situation???


Just a quick couple pieces around the power of story. I’ve got Story or Die on my ever expanding to-read list. But I’ll start with Peter Lynch:

The notion of the story is an important one. As I've said so many times before, if you don't know the story, you don't know the company.

And I’ve shared this before, but the source tweet is too good not to share again:

And this is so painfully true.

If there’s one thing (among many) I’m piss poor at, it’s telling stories and selling myself. Inb4 my mum messages me again to stop selling myself short and being so negative. Work in progress! Time to re-read How to Win Friends and Influence People.

Under the Spotlight: Ann Miura-Ko

Each week I provide a little spotlight on an investor or operator I admire.
Ann Miura-Ko is this weeks focus, in a nutshell:

  • Grew up in Palo Alto to a rocket scientist father (at NASA!) and [I can’t seem to find what here mother did, sorry!]. In her own words: when I was a little kid when I was two, I only spoke Japanese and we were living in Michigan. And I used to be this very hostile little child and I would walk by anyone speaking in English, and in Japanese I would say, “I wish you would leave.” My poor mom.

  • She has a B.S. in electrical engineering from Yale and a PhD from Stanford in math modeling of computer security.

  • Previously worked at Charles River Ventures and McKinsey before later co-founding at Floodgate, a seed-stage venture capital firm with investments in companies like Lyft, Twitter, Twitch, and Okta.

Miura-Ko on Startup Grind [Transcript Link]

Interesting thoughts on what makes some entrepenrus successful:

Something that I think is under appreciated and that's an authenticity about the entrepreneur. And this is the factor that I think gets us past entrepreneurs who are entrepreneurs because they want to be entrepreneur hero worshiped. And I think that becomes harder in Silicon Valley, because there is this notion that being an entrepreneur is this romantic ideal. And what I think the movies, the tv shows don't recognize is that it's like what they call it it's a Startup Grind. I think you know there's nothing romantic in working hundred hour weeks and not seeing your family and throwing out code you've been working on for two years because your co-founder decided that you're going to pivot. There's nothing romantic in that and yet we romanticize it and so the authenticity of that idea to that entrepreneur is really important because it gets you through those moments.

And some other qualities of great entrepreneurs:

our best entrepreneurs when you present them with these obstacles it’s almost like they don't see it. My brother works in F1 car racing, chassis design, and one thing he was telling me was on the race track you'll have these. If you look at the obstacles you're not going to get through the race track. You have to be able to see past them and through the path. And I think the best entrepreneurs are like that. They don’t actually see obstacles, they see a path through those obstacles and they’re continuously adjusting their path and they aren't even thinking about it.
And sometimes that means breaking walls, breaking boundaries, breaking people. it's just sort of it can be a very ugly scene and yet it’s sort of this notion that they have to get to the end zone. And it's that singular focus and drive that gets them to this end. That could be a very you know ugly person in some ways, right you've read I'm sure many of you have read the autobiography of Steve Jobs, it's not a pretty person at the end of the day but it is that singular drive, that vision, drives that person we really like to see that.

Mercury News interview [Link]

Short, random little interview I found, but has some great nuggets!

the real power of the Internet wasn’t the interesting businesses created upon it. The real power was comparable to the Gutenberg press or the Industrial Revolution. It created a new business mindset and new ways of innovation. With the Gutenberg press, there was an incredible, dynamic flow of information created as the result of it, with the ensuing Enlightenment period and the ability of academics to debate ideas, question religion. All that happened from one simple innovation of being able print more information in one day than you could by hand.

What the Internet has created is the democratization of entrepreneurialization. The creation of new businesses is a completely new process.

Her thoughts on if she finds it difficult working in a predominantly male field:

I just never really pay attention to that. If I walk into a room and I’m the only female, I don’t notice it anymore. I think it’s important for women to adopt that mentality if we want to play a large role. The thing I love about the tech community here is it is completely merit-driven. If you have something to add to the conversation, people will listen to you. If you don’t, male or female, people won’t listen. Silicon Valley, it’s not a male culture, it’s a technology culture that woman can be very passionate about. The presence of women in an industry is not an excuse for whether women should be in that industry. We should find our path into it.

Miura-Ko on The Tim Ferriss Show [Link] [Apple Link]

This particular section of the podcast was great:

In Silicon Valley, we spend so much time about product and product market fit that we forget that there’s this huge emphasis you might want to place on the fact that a company is also an organization. A company is also a category that you’re building. The company is also a business model. A company is also a team. And so, it’s the skill set actually to balance all of those things and knowing when you fundamentally need to change out the talent in your team, knowing when you actually need to let go of the product, and knowing actually – to me this is probably the hardest piece – knowing the difference between a winning strategy versus a strategy not to lose.

More about the “strategy not to lose”

It’s not to lose to a competitor, not to lose talent, a strategy not to lose out on revenue. So, it’s all these fears that you have of captured ground or the fact that you might have someone take over something that you want to do – a competitor who’s breathing down your neck versus a strategy for winning is about where you double down on? What do you do to capture ground, to be aggressive, to play offense and not defense? To me that is a huge difference between that strategy of “I’m going to win in this market” versus “I’m not going to lose.” And not losing often involves a lot of hedging. And when you feel that urge to hedge, you need to focus. You need to be offensive.

Bonus Quirky Content

Something to read: Why not Microcap Investing for us? [Link]

My good mate Eugene Ng (@EugeneNg_VCap) has written a great article covering some of the biggest pros and cons of Microcaps. Do I agree with all the cons? No. But to dismiss them would be stupid of me.

The Pros of Microcaps are well covered like: Larger potential upside for smaller companies, Value being more important in Microcaps than Growth, and Microcaps usually having much higher Insider Ownership.

And the cons of investing in Microcaps?

Poor Liquidity, Smaller size negatively limits Scale: Microcaps generally tend to be top dogs in much smaller and niche markets, seldom are serving a large potential total addressable market (TAM), High attention required: Because of the general lack of information, constant monitoring and intense scrutiny, much more extensive and longer due diligence is required, and High Portfolio Turnover: Anecdotal feedback from the top microcap investors, indicated that he held 35–40 stocks and only still holds 1–2 stocks of those at the end of a 5 year period.

I don’t necessarily agree with the high attention and high turnover points, but it’s certainly something to be aware of. I usually find the more work I do early, the less work required later on. Like I mentioned in issue #17, I’m trying to fish where fisherman ain’t. And I feel large caps (especially tech), have a lot more well-equipped and experienced fisherman to go up against. Either way:

Play the game that works best for you, not that of others.

Something to watch: Taipei’s Sidewalks [9 mins]

I know what you’re thinking “Why on earth would I watch a video about Taipei’s sidewalks”. And I completely understand! But give it a crack. You might enjoy it :)

Originally saw this on Reddit as “Explore the quirky chaos of Taipei Taiwan's sidewalks and find the beauty within the architecture around them”. And this video is everything I love about YouTube. Niche, obscure, informative, yet still interesting!
I’ve been to Taipei once, and it’s easily one of my top 3 favourite destinations. And it’s the little things like this that give it such an interesting character. Makes it such an easy place to love.

For all its quirks the 騎樓 (Qílóu) is really something culturally significant to Taiwan and only adds to your experience here.
Only a select few places can you walk and have every other space be truly unique to that building. I mean god forbid you have to pay attention to your surroundings and watch where you walk.

Something to listen to: Paul Enright - The Buy Side Primer [Link] [Apple Link]

A number of friends I admire and look up to on Twitter have shared this. And if they are sharing, it’s definitely worth checking out!

I want to live more in the quadrant where everything is about growing and every situation is not meant to be at someone else's expense. It's a win-win. I am doing things. I'm putting things out there where I don't know if I'm going to get paid. I don't have anything I'm trying to do. I'm just trying to get smarter. I'm trying to develop relationships that will last a long period of time. I'm trying to think about ideas that I want to do now, and think I want to be able to continue to do 50 years from now. And I don't want to do anything. I don't want to put on a position in my portfolio that I know I'm going to sell for sure. That doesn't mean I won't sort of actively trim it or manage it, but I just want to be playing a long game and be playing this more infinite game of investing and learning than a series of finite games.

A rabbit-hole / resource to dive into: MOI Global’s Insights [Link]

MOI’s collection of investing resources is second to none. Bookmark it!

Final thought for the week:

Until next week, have a good one!
- Carrot Boy

You can find previous issues of Curated by Kalani here. I’m on the web at kscarrott.com and on Twitter @scarrottkalani.

Liked this post? Why not sign up.