Bitcoin: Hindsight and the Law of Accelerated Returns

Did anyone actually followed my advice and bought bitcoins back in December 2013? I hope so because four years ago 1 Bitcoin was < $600 and now it’s < $20000. The ROI on this one is tremendous, it’s more than 3000%.

time to buy bitcoins

Albert Einstein is quoted as saying that the most powerful force in the Universe is the compound interest. Well, he didn’t knew about Bitcoin.

My abstract image for Bitcoin is that of a currency that actually represents freedom and privacy, two qualities that a lot of people are willing to  pay a heavy price in order to achieve. This being said, no matter how hard governments and authoritarian powers try to crackdown and to control it its value will only go up. Now, in hindsight, it turns out that the states and governments are starting to bow in the face of Bitcoin and not the other way around (central banks will start in 2018 to hold reserves of cryptocurrencies).

When you buy one Bitcoin you get instant value for it, you get freedom and anonymity,  you get a currency that it’s in limited number, the maximum number of bitcoins that can be mined being somewhere around 21 million (the real number is even smaller because there are reportedly millions of Bitcoins that got lost).  When you get a Dollar you get a fiat currency that it’s not backed up by any reserve of gold and it’s not worth the paper it’s written on. Add to this the money multiplier effect that is used by banks to virtually increase the money supply.

Will Bitcoin continue it’s rocketing path up? It’s quite probable because the hype is only starting up, blockchain startups are popping up everywhere and more and more people are aware of cryptocurrencies. We are living very interesting times, the new technology is doing things that were not possible in the past, you can now be among the top 50 richest men in the world and nobody knows who you are (Satoshi Nakamoto), you can carry your considerable wealth with you in a special physical crypto wallet and you can walk the streets being completely unknown.

I’m not sure if the old economic laws are still applicable, a bubble might never come despite what the old dinosaurs in economy are saying,  technology brings change and returns that are increasing exponentially. Ray Kurzweil, the futurist who came up with the Law of Accelerating Returns stipulates that humans are linear in nature and technology is exponential. When you take a human, linear activity like the economy and bind it to a currency that is also bound to an exponential technology you might get very interesting results. We have to wait and see what happens.

This being said, it’s also never bad to be cautious, getting a positive return on your investment is not astrophysics or rocket science, it’s simply ‘buy low and sell high’, if you managed to buy Bitcoins at a low price maybe now it’s the time to reap the harvest, to take the gains and to invest in yourself and in other assets.

Book review: Making Ideas Happen by Scott Belsky

Overcoming the Obstacles Between Vision and Reality

This is my second time reading this book, the first time being about two years ago. I don’t usually read a book twice or more unless it’s worth it so without further introduction let’s get into the good stuff.

The primary takeaway from this book would be the Action Method which has three components: Action Steps, References, and Backburner Items. The action steps are all the incremental objectives that you have to take in order to move forward with your project, the references are basically all the information sources that you have to consult from time to time in order to achieve the action steps and the backburner items are tasks that you might want to do in the future.

“Like most creative people, I’m sure you struggle to make progress in all of your projects, with the greatest challenge being the sheer number of projects before you! But once you have everything classified as a project, you can start breaking each one down into its primary components: Action Steps, References, and Backburner Items. Every project in life can be reduced into these three primary components. Action Steps are the specific, concrete tasks that inch you forward: redraft and send the memo, post the blog entry, pay the electricity bill , etc. References are any project-related handouts, sketches, notes, meeting minutes, manuals, Web sites, or ongoing discussions that you may want to refer back to. It is important to note that References are not actionable—they are simply there for reference when focusing on any particular project. Finally, there are Backburner Items—things that are not actionable now but may be someday. Perhaps it is an idea for a client for which there is no budget yet. Or maybe it is something you intend to do in a particular project at an unforeseen time in the future.”

Start your Actions Steps with a verb “call, install, research, update” and so on. Make sure you always capture Action Steps everywhere, note them down as soon as they pop into your mind.

“Capture! Capture Action Steps relentlessly. During a brainstorm or a meeting, or on the run, you will generate ideas, and those ideas will disappear unless they are broken down into concrete verb-driven Action Steps. Collect them using whatever notebook or technology option you desire—but try to keep Action Steps separate so they stand out amidst your References and Backburner Items.”

If you are delegating someone else to execute the Actions Steps it would be a good idea to check the execution through “Ensure Action Steps” type of…Action Steps. Another type of managerial Action Steps is the “Awaiting Action Step”:

 “The last type of managerial Action Step is the “Awaiting Action Step”. When you leave a voicemail for someone, send a message to a potential customer, or respond to an e-mail and clear it from your in-box, you’re liable to forget to fol ow-up if the person fails to respond. By creating an Action Step that starts with “Awaiting,” you can keep track of every ball that is out of your court.”

The two-minute rule: if the Action Step can be done in under two minutes do it right away.

Always be shipping, always move forward, consider this your main obligation:

“Godin made the case that shipping is an active mind-set rather than a passive circumstance. “When you run out of money or you run out of time, you ship. . . . If your mind-set is ‘I ship,’ that’s not just a convenient shortcut, it’s in fact an obligation. And you build your work around that obligation. Instead of becoming someone who’s a wandering generality—and someone who has lots of great ideas and ‘if only, if only, if only,’ you are someone who always ends up shipping.””

Ultimately, success is a numbers game, it usually takes a lot of tries and failures to get to that winning idea (and this why it’s important to always ship):

“The truth is, creativity isn’t about wild talent as much as it’s about productivity. To find a few ideas that work, you need to try a lot that don’t. It’s a pure numbers game. —Robert Sutton, professor of management science and engineering, Stanford School of Engineering .”

The old reptilian brain is the source for the fear of risk and the fear of failure and one of the main forces holding us back:

“But the primal tendencies of the lizard brain to keep us safe by avoiding danger and risk are still potent. After the biology lesson, Godin explained that “every single time we get close to shipping, every single time the manuscript is ready to send to the publisher, the lizard brain speaks up. . . . The lizard brain says, ‘They’re gonna laugh at me,’ ‘I’m gonna get in trouble . . .’ The lizard brain [screams] at the top of its lungs. And so, what happens is we don’t do it. We sabotage it. We hold back. We have another meeting.” The lizard brain interferes with execution by amplifying our fears and conjuring up excuses to play it safe.”

Creativity works well with constrains in making ideas happen:

“It turns out that constraints—whether they are deadlines, budgets, or highly specific creative briefs—help us manage our energy and execute ideas. While our creative side intuitively seeks freedom and openness—blue-sky projects—our productivity desperately requires restrictions. “

Other subjects in this book are: the stories of how Tony Hsieh, CEO of Zappos and Ji Lee former Creative Director at Google put their ideas into practice, the three categories of creative persons: the Dreamers, the Doers and the Incrementalists, the importance of architecture and the workplace in the productivity of the creative process, the concept of ROWE (Results Only Work Environment).

A good conclusion-quote to end this review would be this one:

“IT SHOULD BE clear by now that organizing life into a series of projects, managing those projects with a bias toward action, and always moving the ball forward are critical for execution.”

First Search

First Search is a new product from First Round and it’s also the Product of the Day on Product Hunt. Another premiere for this product is the fact that I decided to start my product review series with it. The idea behind this series is to pick a product, it will usually be the Product of the Day as seen on Product Hunt, to learn and discover what makes it successful.

Short introduction: First Round is an investment company that invests early (“we’re usually the first money in”) in startups. Some notable startups that got funding are Uber, Mint, GroupMe, Vidme, 9GAG, Wikia, Blue Apron and many others.

First Search is basically a directory consisting of lists of articles on startup related topics. The articles are carefully selected and curated by the partners at First Round and apparently there are more than 10000 articles waiting to be read by people hungry for information and advice.

There are a lot of topics and subtopics and the sight of them can create an overwhelming experience for someone like me who is interested in a lot of them. I can’t wait to start reading and learning new things where should I start? It reminds me of the paradox of choice effect: people have a difficult time making a decision when they are faced with multiple options. More info about the paradox of choice here. I did a count and there are more than 130 visible topics, maybe showing only the main categories and the rest of the subcategories in a dropdown would be a better idea.

first search categories

I’ve read some of the articles and they are indeed great. Here are some of the things that I’ve learned:

  • Tweets shorter than 100 characters get a 17% higher engagement rate
  • The ideal length of a Facebook post is less than 40 characters
  • The ideal length of a blog post is 7 minutes, 1,600 words
  • Reward and Punishment Super-response Tendency
  • Liking/Loving Tendency
  • Disliking/Hating Tendency
  • Doubt-Avoidance Tendency

Links to the articles in cause: The Ideal Length of Everything Online According to Science | Charlie Munger on The Psychology of Human Misjudgment

A neat feature is that if you sign up you can then bookmark the articles that interest you.

There is a lot of information overload and a lot of unstructured data on the Internet so a product that solves these problems is highly appreciated. I will definitively come back and use First Search for knowledge acquisition.


Book Review: Quiet – The Power of Introverts in a World That Can’t Stop Talking by Susan Cain

This book turned out to be well researched and to exceed my expectations. It helped me to better understand the world of introverts, myself and the world in general. So, according to the book, how exactly is the world shaped by the forces of introversion and extroversion?

Let’s start with the current status of the Western world: it’s competitive and it’s dominated by a “business culture” and a “personality culture” that replaced the old “culture of character”. In the older times characteristics such as modesty and simplicity were seen as desirable whereas in recent times the need to differentiate yourself and to entertain seems to have replaced the old values.

America had shifted from what the influential cultural historian Warren Susman called a Culture of Character to a Culture of Personality—and opened up a Pandora’s Box of personal anxieties from which we would never quite recover. In the Culture of Character, the ideal self was serious, disciplined, and honorable. What counted was not so much the impression one made in public as how one behaved in private. The word personality didn’t exist in English until the eighteenth century, and the idea of “having a good personality” was not widespread until the twentieth. But when they embraced the Culture of Personality, Americans started to focus on how others perceived them. They became captivated by people who were bold and entertaining. “The social role demanded of all in the new Culture of Personality was that of a performer,” Susman famously wrote. “Every American was to become a performing self.”

The reality is that in such a business culture verbal fluency and sociability are the two most important predictors of success, according to a Stanford Business School study.

Talkative people, for example, are rated as smarter, better-looking, more interesting, and more desirable as friends. Velocity of speech counts as well as volume: we rank fast talkers as more competent and likable than slow ones. The same dynamics apply in groups, where research shows that the voluble are considered smarter than the reticent—even though there’s zero correlation between the gift of gab and good ideas.

So what does this mean? Do introverts have no chances of succeeding in such an environment? It turns out that introverts have innate qualities that can help them succeed in places where extroverts can’t.

We tend to overestimate how outgoing leaders need to be. “Most leading in a corporation is done in small meetings and it’s done at a distance, through written and video communications,” Professor Mills told me. “It’s not done in front of big groups. You have to be able to do some of that; you can’t be a leader of a corporation and walk into a room full of analysts and turn white with fear and leave. But you don’t have to do a whole lot of it. I’ve known a lot of leaders of corporations who are highly introspective and who really have to make themselves work to do the public stuff.”

Grant says it makes sense that introverts are uniquely good at leading initiative-takers. Because of their inclination to listen to others and lack of interest in dominating social situations, introverts are more likely to hear and implement suggestions. Having benefited from the talents of their followers, they are then likely to motivate them to be even more proactive. Introverted leaders create a virtuous circle of proactivity, in other words. In the T-shirt-folding study, the team members reported perceiving the introverted leaders as more open and receptive to their ideas, which motivated them to work harder and to fold more shirts.

Introverts can focus and be better learners through Deliberate Practice:

What’s so magical about solitude? In many fields, Ericsson told me, it’s only when you’re alone that you can engage in Deliberate Practice, which he has identified as the key to exceptional achievement. When you practice deliberately, you identify the tasks or knowledge that are just out of your reach, strive to upgrade your performance, monitor your progress, and revise accordingly. Practice sessions that fall short of this standard are not only less useful—they’re counterproductive. They reinforce existing cognitive mechanisms instead of improving them.

Introverts also have the marks of what makes a deep person, they

tend to be philosophical or spiritual in their orientation, rather than materialistic or hedonistic. They dislike small talk. They often describe themselves as creative or intuitive. They dream vividly, and can often recall their dreams the next day. They love music, nature, art, physical beauty. They feel exceptionally strong emotions—sometimes acute bouts of joy, but also sorrow, melancholy, and fear.

It seems that the phenomena of introversion and extroversion is not specific only to humans, it’s also encountered throughout nature. In some conditions the introvert individuals of a species have better survival chances due to the fact that they are more reserved whereas in other conditions the extrovert individuals have better chances of survival.

But it turns out that it’s not only humans that divide into those who “watch and wait” and others who “just do it.” More than a hundred species in the animal kingdom are organized in roughly this way. From fruit flies to house cats to mountain goats, from sunfish to bushbaby primates to Eurasian tit birds, scientists have discovered that approximately 20 percent of the members of many species are “slow to warm up,” while the other 80 percent are “fast” types who venture forth boldly without noticing much of what’s going on around them.

Some differences between introverts and extroverts:

Or consider this trade-off: human extroverts have more sex partners than introverts do—a boon to any species wanting to reproduce itself—but they commit more adultery and divorce more frequently, which is not a good thing for the children of all those couplings. Extroverts exercise more, but introverts suffer fewer accidents and traumatic injuries. Extroverts enjoy wider networks of social support, but commit more crimes. As Jung speculated almost a century ago about the two types, “the one [extroversion] consists in a high rate of fertility, with low powers of defense and short duration of life for the single individual; the other [introversion] consists in equipping the individual with numerous means of self-preservation plus a low fertility rate.”

This blindness to danger may explain why extroverts are more likely than introverts to be killed while driving, be hospitalized as a result of accident or injury, smoke, have risky sex, participate in high-risk sports, have affairs, and remarry. It also helps explain why extroverts are more prone than introverts to overconfidence—defined as greater confidence unmatched by greater ability.

In Academia, introversion predicts academic performance better than cognitive ability.

The Free Trait Theory:

You might wonder how a strong introvert like Professor Little manages to speak in public so effectively. The answer, he says, is simple, and it has to do with a new field of psychology that he created almost singlehandedly, called Free Trait Theory. Little believes that fixed traits and free traits coexist. According to Free Trait Theory, we are born and culturally endowed with certain personality traits—introversion, for example—but we can and do act out of character in the service of “core personal projects.”

Other subjects discussed in the book are: the cultural differences between the West and the East, High Self-Monitoring and Low Self-Monitoring, the relations between introverts and extroverts, how to motivate introverts, Jon Berghoff’s astonishing success at sales, how to deal with introverted children.

I have a bunch of notes taken but the best way to understand more about the fascinating world of introversion would be to just read the book because it’s definitely worth it.

Book Review: Anything You Want by Derek Sivers

What I like most about this book is the concept of “Ten years of experience in one hour“: ten years of the author’s experience as an accidental entrepreneur transposed in a concise manner in less than 100 pages. I’m actually surprised that this concept didn’t caught on and became more popular because frankly speaking a lot of books contain a lot of filler information just to achieve a higher number of pages. I would rather read something short and full of useful information (I’m referring to nonfiction books here) than a long, diluted version. This concept might also encourage more people to start reading.

Anyway, let’s get back to the book and its author. Who is Derek Sivers? Derek is the founder and former CEO of CD Baby, an online CD store for independent musicians. He initially started the company in 1997 as a website through which he sold his own CD’s (he was a professional musician at that time). That website turned out to be something more when his friends and the friends of his friends requested to sell their CD’s on his website too.

Let’s see some of the things that I’ve learned from  this book.

The author is interested in execution and not ideas and has an interesting system by which he evaluates an idea and its execution:











GREAT EXECUTION = $1,000,000


To make a business, you need to multiply the two components.

The most brilliant idea, with no execution, is worth $20.

The most brilliant idea takes great execution to be worth $20,000,000. That’s why I don’t want to hear people’s ideas. I’m not interested until I see their execution.”

Side note: yes, there are a lot of spaces between paragraphs, without these spaces the book is maybe only 50-60 pages long.

Nothing goes as planned, you usually have to be prepared for anything:

“You can’t pretend there’s only one way to do it. Your first idea is just one of many options. No business goes as planned, so make ten radically different plans.”

Sometimes you can be better off not knowing how things are usually done because then you can do them in your own, out of the box way:

“Now I was stunned. I asked a few friends and found out he was right. People can just quit a job without finding and training their replacements. I had no idea. All these years, I just assumed what I did was normal. There’s a benefit to being naïve about the norms of the world— deciding from scratch what seems like the right thing to do, instead of just doing what others do.”

How to deal with employees that are constantly asking you for advice:

“I asked one person to start a manual, write down the answer to this one situation, and write down the philosophy behind it.

Then everyone went back to work.

Ten minutes later, new question. Same process:

Gather everybody around.

Answer the question and explain the philosophy.

Make sure everyone understands the thought process.

Ask one person to write it in the manual.

Let everybody know they can decide this without me next time”

Trust but verify (your employees).

“Trust, but verify. Remember it when delegating. You have to do both.”

Derek gave his employees a lot of freedom and empowerment. It turned out to be a bad idea. They took over the profit-sharing program and directed all the profits of the company to themselves.

“Lesson learned too late: Delegate, but don’t abdicate.”

There are also various stories in the book worth reading like that time when Steve Jobs put his company in difficulty:

Whoa! Wow. Steve Jobs had just dissed me hard!