Podcast Summary
News and musings on Meta, NFTs, and Divi Homes: Altimeter Capital criticizes Meta's leadership, NFTs transform Firefest Island into a luxury marketplace, and Divi Homes faces criticism for biased journalism
This week's episode of "This Week in Startups" covers several news topics, including an open letter from Altimeter Capital to Meta Corporation, the reemergence of Firefest Island as a marketplace for luxury properties using NFTs, and a hit piece on Divi Homes in Fast Company. Host Molly Graham shares her weekend experiences and talks about the importance of downtime. She also discusses her thoughts on the future of humanity and progress with her co-hosts. In the news segment, they analyze the reasons behind Altimeter Capital's letter to Meta and discuss the implications of the letter. They also discuss the controversy surrounding Divi Homes and how to identify biased journalism. Finally, they share some random musings and thoughts on various topics. The episode is brought to you by Linode and Vanta, and listeners can benefit from exclusive offers from both sponsors.
DC Comics' Black Adam film impresses despite skepticism and Meta shareholder's call for belt-tightening: The Rock's Black Adam film impresses in the DC universe, while Meta shareholder urges focus and a cap on metaverse investments due to financial losses
The new DC Comics film featuring Dwayne "The Rock" Johnson as Black Adam is a delightful surprise for even those who were skeptical, as it seamlessly integrates with the Snyder-Jenkins DC universe. Meanwhile, in the tech world, Facebook shareholder Brad Gerstner wrote an open letter to Mark Zuckerberg urging Meta to tighten its belt and focus investments, specifically suggesting a cap on metaverse-related investments due to Meta's significant financial losses. The letter comes as Meta's stock has seen a significant decline in value over the past year.
Large tech companies' talent and resource hoarding leading to financial losses: Large tech companies face investor skepticism due to high employee counts and substantial financial losses. They could boost share prices by focusing on profitability through share buybacks and dividends.
The large tech companies, such as Meta and Facebook, have been hoarding talent and resources, leading to high employee counts and substantial financial losses, which may be deterring investors. The discussion also highlighted the potential for these companies to focus more on profitability by buying back shares and even implementing dividends to boost share prices. Furthermore, the RISE node startup program, which offers significant benefits including free cloud credits and expert support, was introduced as a potential solution for businesses looking to scale and grow efficiently.
Linode expands globally with 12 new locations and partnership with Akamai Plus: Linode is expanding its global footprint with 12 new locations and partnership with Akamai Plus for enhanced security and CDN solutions. New users receive $500 in free credits and startups can apply for up to $120,000 in infrastructure credits through the RISE program.
Linode, a cloud computing platform, is expanding globally with 12 new locations in 2023 and aiming for 200 data centers worldwide. They offer access to top security and CDN solutions through Akamai Plus. Linode also provides $500 in free credits for new users and a startup program, RISE, offering up to $120,000 in infrastructure credits during the first year. Elsewhere, an open letter from investor Brad Gerstner to Meta (formerly Facebook) advocated for the company to streamline and focus, suggesting reducing headcount by 20% and annual capex by $5 billion before considering metaverse spending. Gerstner believes these cost savings could be used to benefit shareholders through stock buybacks or dividends. The letter emphasized the importance of focusing resources and avoiding unnecessary expenditures.
Frustrated shareholder's letter to Meta goes public: Aggressive investor letter ignored in private meetings leads to public release, potential institutional selling, and stock downturn, raising questions about Meta's leadership and financial discipline
The public release of a shareholder's letter to Meta Platforms Inc. (Meta) from investor Adrian Brody's character in the movie "The Social Network," signifies frustration and aggressive feedback towards Meta's financial management. This letter, which suggests cost-cutting measures and financial discipline, was likely ignored during private meetings. The public release of the letter indicates a failure of these discussions to yield results, potentially leading to large institutional investors selling their Meta stocks and contributing to the stock's downward trend. The letter's aggressive nature, which is more impactful in the public sphere, raises questions about Meta's leadership and their long-term vision. The letter's content, which emphasizes the importance of financial discipline and cost control, highlights Meta's current financial situation and the potential for increased competition. Ultimately, the letter's public release marks a significant moment in the ongoing narrative of Meta's financial management and its perceived value in the market.
Google vs Facebook: Different Approaches to Business: Google focuses on operational efficiency and high profits, while Facebook invests in future tech like VR and AR, potentially impacting short-term profits but offering long-term opportunities.
Companies like Google and Facebook, which are often compared to each other, have different approaches to managing their businesses. While Google has maintained operational efficiency and high profits, Facebook is investing heavily in the future, particularly in areas like virtual reality (VR) and augmented reality (AR). This investment comes at a cost, as Facebook's operating expenses are higher than Google's, but the potential payoff could be significant if VR and AR prove to be the next major technological trend. For shareholders, this means a choice between betting on a company that prioritizes efficiency and short-term profits, or one that is willing to make long-term investments in new technologies. The speaker also noted that some advertisers have expressed frustration with Facebook's recent ad targeting capabilities, which could impact its future revenue growth. Ultimately, the success of Facebook's bet on the metaverse remains to be seen, but it underscores the importance of companies continually innovating and investing in the future to stay competitive.
Impact of decreasing ad effectiveness and Apple's privacy updates on companies' profitability: Companies, especially in tech industry, face challenges due to decreasing ad effectiveness and increasing expenses. Apple's privacy updates add to these concerns, potentially impacting profitability and valuation. Efficient leadership and spending are crucial indicators of a company's health.
The decreasing effectiveness of advertising on platforms like Facebook and Instagram, coupled with increasing expenses, is causing concerns for companies, particularly those in the tech industry. This shift, driven in part by Apple's privacy updates, could impact profitability and valuation. Furthermore, the focus and efficiency of a company's leadership and spending are crucial indicators of its health. For instance, the macadamia nut company House of Macadamias, which was inspired by the podcast and the author's book, Angel, is a successful example of a company that has used its returns wisely. In contrast, Alphabet (Google) and Facebook, despite their significant revenues, are spending disproportionately more on capital expenditures to generate their income, highlighting a lack of efficiency.
Expressing Concerns in Relationships: Speak up constructively and respectfully when things aren't meeting expectations, but consider leaving if necessary. Public reviews can hold businesses accountable.
Communication is key, especially when it comes to expressing concerns or feedback in a relationship, whether it's a business or personal one. Brad's situation highlights the importance of speaking up when things aren't meeting expectations, but doing so in a constructive and respectful manner. The discussion also touched on the idea of taking action when necessary, such as leaving a business or project that isn't delivering, and the role of public reviews in holding businesses accountable. Ultimately, it's important to find a balance between expressing concerns and maintaining a respectful and productive relationship.
Repurposing a Scam Site for a Crypto Real Estate Project: Buyers should exercise caution when dealing with a mysterious crypto real estate project associated with a past scammer, and founders in the SaaS industry should prioritize SOC 2 compliance to maintain professionalism.
The crypto community is repurposing the site of a past luxury con artist scandal into a new crypto-based real estate development, and potential buyers should exercise extreme caution. The company behind the project, AGIA International, is shrouded in mystery, with no verifiable information available beyond a website and a LinkedIn page. The sale of properties is only possible through the purchase of NFTs, and there's a $10,000 fee just to get on the allow list. The lack of transparency and the association with a past scammer, Billy McFarland, should raise major red flags. Additionally, founders in the SaaS or services industry who store customer data in the cloud should prioritize SOC 2 compliance to close deals and avoid appearing unprofessional.
Vanta helps startups quickly and affordably achieve SOC 2 compliance: Vanta reduces the time to become SOC 2 compliant from 3-5 months to 2-4 weeks and offers partnerships with audit firms and training to file reports directly with them. They also support early-stage startups with a $1,000 discount.
Being SOC 2 compliant is crucial for closing major customers, and Vanta can help startups achieve this certification quickly and affordably. The average time for Vanta customers to become SOC 2 compliant is just two to four weeks, compared to three to five months without Vanta. Vanta also partners with over two dozen audit firms and offers training to file SOC 2 reports directly with them. Furthermore, Vanta supports early-stage startups and is offering a $1,000 discount. However, the podcast hosts expressed concern about a hit piece on Divi Homes in Fast Company and decided to wait for the company's response before covering the story in detail. They believe that women founders face harsher criticism than men and that one negative review or article does not accurately represent a company's performance. The podcast hosts emphasized the importance of fair analysis and invited Divi Homes to come on the show to share their side of the story.
Media bias against women CEOs: Media outlets may unfairly focus on personal details of women CEOs, creating distractions and hindering productive conversations. Strive for fair and balanced reporting.
Certain media outlets may use a different tone when reporting on women CEOs compared to their male counterparts. This can manifest in the form of hit pieces that focus on personal details, such as a CEO's education or family arrangements, which would not receive the same level of attention if the CEO were a man. This double standard is not only unfair but also distracts from the business model and achievements of the company in question. For instance, a CEO's use of a nanny or bringing her children to work may be criticized in a way that would not apply to a man in a similar situation. This kind of coverage can hinder productive conversations and create unnecessary controversy. Instead, it's more beneficial to engage directly with the CEO and discuss the business at hand. Ultimately, it's essential to be aware of this bias and strive for fair and balanced reporting.
Blurred lines between journalism and content creation: Some creators prioritize clicks and followers over factual reporting, blurring the line between journalism and content creation. Consumers should be aware of sources and motivations behind consumed content.
The line between journalism and content creation has become blurred, with some creators prioritizing clicks, traffic, and followers over factual reporting. This was highlighted in a discussion about an article comparing a rent-to-own company to historical figures who stripped people of their wealth and demanded excessive labor. Despite the importance of investigative journalism and its continued existence in reputable publications, there is also a growing industry of content creators who are compensated based on engagement rather than factual accuracy. This blurring of lines can lead to egregious comparisons and misunderstandings, and it's important for consumers to be aware of the source and motivations behind the content they consume. Additionally, the reach and impact of international movie franchises like Fast and Furious was emphasized as an example of how media can bring diverse audiences together.
DC Universe's 'big tent strategy' and the entertainment industry: Journalism requires concrete evidence and named sources for accurate reporting on complex issues like the entertainment industry's audience expansion strategies and the housing market.
The entertainment industry, specifically in the context of the DC Universe's inclusion of big-name stars like The Rock in ensemble pieces, is using a "big tent strategy" to attract a wider audience. However, when it comes to reporting on such topics, it's crucial to avoid vague statements and provide concrete evidence. Anonymous sources and word salad do not contribute to a clear understanding of the issue. In journalism, naming sources and providing solid evidence is essential for triangulating the truth. The housing market, including rent-to-own models, is a complex issue with potential for exploitation, but more proof is needed to make definitive statements. It's essential to approach such topics with a critical and evidence-based perspective. Additionally, it's important to recognize the potential biases in reporting and strive for balanced and accurate information.
Article on Adina lacks sufficient evidence: The article on Adina's potential involvement in exploitative real estate practices lacks solid evidence and could have benefited from a more balanced perspective, including interviews with Divi homeowners or the company itself.
The article discussing Adina, the CEO of Divi Homes, and her potential involvement in exploitative real estate practices lacks sufficient evidence and context. While there are concerns about the company and its business model, the assumption that Adina personally is on the same level as predatory lenders from the past is unwarranted and unfair. The article could have been improved by speaking with more Divi homeowners or the company itself for a more balanced perspective. The tone and history of similar articles targeting women CEOs have created a culture of sensationalism and mistrust, making it difficult for readers to take such pieces seriously without solid evidence.
The Evolution of Sensationalist Journalism: Be aware of potential agendas and critically evaluate news sources, as sensationalism and biased reporting are not new phenomena in journalism.
The media landscape has evolved significantly over the years, with the use of sensationalist headlines, anonymous sources, and expert opinions becoming increasingly common. These tactics are often employed to grab our attention and elicit strong emotional responses, but it's important to be aware of potential agendas and to critically evaluate the sources of our news. The history of journalism shows us that this is not a new phenomenon – from yellow journalism in the late 1800s to today's digital media, the goal of getting clicks and selling papers has remained a constant driver. However, podcasting offers an alternative – a more personal and trustworthy way to consume news, as we can build relationships with trusted sources and gain a more nuanced understanding of the issues.
Breaking free from journalistic constraints: Podcasting rewards thoughtful and nuanced discussions, allowing for in-depth analysis and fair treatment of subjects, while providing an opportunity to focus on critical thinking and intellectual honesty.
Podcasting offers a unique platform for intellectual honesty, critical thinking, and building trust with audiences. Unlike traditional journalism, which often caters to mass audiences and their desire for outrage and entertainment, podcasting rewards thoughtful and nuanced discussions. The ability to cultivate smaller, smarter slices of content allows for more in-depth analysis and fair treatment of subjects. However, the downside is that these thoughtful pieces may not receive the same level of engagement and retweets as controversial or emotionally charged content. The structure of journalism, which often prioritizes clicks and page views, can hinder the presentation of accurate and fair stories. Podcasting provides an opportunity to break free from these constraints and focus on critical thinking and intellectual honesty.
Journalists should aim for accuracy, fairness, and transparency in reporting: Strive for balanced and informative articles by interviewing various sources and providing context, rather than relying on clickbait and sensational headlines.
Some news outlets, like Business Insider, use sensational headlines and biased reporting to attract subscribers. Instead of relying on clickbait, journalists should aim for accuracy, fairness, and transparency. For instance, an article about Divi Homes could have been improved by interviewing homeowners who love their Divi homes, an expert on predatory loans, and comparing the contracts signed by homeowners in the 5060 area with Divi's contracts. This would have provided a more balanced and informative article. As investors, it's essential to be aware of such biased reporting and focus on reliable sources. Additionally, during earnings season, it's exciting to see companies like Google, Microsoft, and Spotify report their financial results. Personally, I'm a shareholder in Google and Microsoft, and I'm considering adding Netflix and Spotify to my portfolio. My biggest gain right now is Adobe, while my biggest loss is Disney. Despite the losses, I'm building my portfolio for the long term and plan to buy more Disney soon. Overall, it's crucial to stay informed about global events while maintaining a balanced and objective perspective.
Believing in long-term trend towards peace and stability: Despite global crises, speaker sees opportunities for countries to reduce dependence on dictatorships, leading to a more stable world in the long run.
Despite current global tensions and crises, the speaker believes in the long-term trend towards peace and stability in the world. They don't foresee China invading Taiwan, and instead, expect cooler heads to prevail. The speaker also sees these crises as opportunities for countries to reduce their dependence on dictatorships for resources and supplies, leading to a more stable world in the long run. They view these events as recurring cycles and believe that cooler heads will eventually prevail, leading to a more just and calm world. The speaker remains optimistic, despite the current chaos, and sees these events as part of a larger, ongoing trend towards resiliency and stability.
Progress towards a better life despite instability: Experts believe the world is making significant progress towards a better life, despite ongoing conflicts, and that current conflicts are less devastating than in the past. Appreciate these improvements and continue striving for a better future.
While the world continues to face instability and conflicts, there is an overall trend towards a better life for more people due to advancements in technology and democracy. However, it's important to remember that history has shown that societies have experienced increased quality of living only to collapse. Despite this, many experts believe that the world is making significant progress and that current conflicts are not as devastating as those in the past. Ultimately, it's crucial to appreciate these improvements and continue striving for a better future. Additionally, there are exciting events coming up, such as a Crypto Roundtable, which will provide opportunities for further discussions and insights.
