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3MinSB - Issue #47: Stonks📈

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3MinSB

January 28 · Issue #47 · View online

Thoughts on life and the everyday.


Hello world and welcome back!
Two weeks ago, I wrote about the unbundling effect and how it’s infiltrated industries and verticals. Rather than conglomerates creating holistic solutions to general problems (‘all in one news outlets’, ‘all in one video streaming platforms’, etc), there’s been proven needs and opportunities for niche, independent companies to capitalize on individual trends and differentiate from the standard. In this way, these companies rely on providing the perfect service for a specific, understood user group. That relies on a core, deeper understanding of not only the users being served but the company as well. They have crafted a vision for how they need to operate in order to differentiate, as well as their internal differentiators that can enable such a service.
With that, this week I read about Public, a company aiming to reinvent the sphere of investing. The allure of stocks and trading is clearly popular, especially for amateurs and students looking to break in (Gamestop with a timely example) These companies are conceived through a gap in a general market with the founders often being the users underserved. Beyond realizing the features needed to alleviate their pains, the best founders have a deeper understanding of how their solution would play out and how the vision would take form. Public has turned the investing game into one that is social, and, well, fun. Robinhood has shown that investing can be intuitive, and the whole experience is built around a slick UI and real-time updates. Public is taking this a step further, building in a social aspect to better understand how people and companies evaluate stocks. They see the investing game as a social learning experiment, with users who want to learn from friends’ holdings. This learning is core to their platform - they’ve already created a collection of learning material for both general investing and stock market specifics. This core is meant to create a community beyond ‘those who invest’ - but rather investors ingrained a social network of trading, showing off their holdings, and learning from others. This would ideally create a flywheel effect that builds into an integrated community of learners and traders.
I haven’t downloaded the iOS app yet but the web version is clean and stripped down to its focus - the only tabs are ‘stocks’ and ‘learn.’
I premise of the company plays directly into the unbundling effect I’ve previously noted - the app is meant for amateur investors who are familiar with social feeds and validation. They understand that users base their decisions on others, and stock investing is no different. But what I found most interesting was not the app nor its look, but rather the culture principles they are built off. Like I mentioned, a company must know itself before it can go on to serve and understand users. The principles drive and root their vision, and can be mapped to any decision. Things like ‘Directly Responsible Individual’ and autonomy through alignment are not standard and can’t be regarded as generic company values. The frameworks are laid out and clear, driving the operation and methods of work.
Exciting pursuit with many opportunities for growth.
Round 47!

What I'm Reading
I find pricing strategy and the product-market-pricing fit fascinating. You’re likely already aware of fundamental strategies like surge pricing on ride-sharing platforms and freemium mobile apps, but the world of pricing has layers on layers of strategy and intent beneath that $10 Uber ride/monthly membership/subscription. There are some interesting case studies on the different pricing models and how they play out, but never have I seen such a thorough and comprehensive deep dive into the thinking behind pricing certain services and the impact on bottom line. I don’t know how much weight my highly recommend‘s hold anymore, but anyways, highly highly recommend.
The Hidden World of Pricing: Uber, Trulia, Etsy, Superhuman & More
If you enjoyed this, do encourage you to check out a few other posts by NFX. I just recently heard of the firm and love its focus on creating an atmosphere of shared learning.
A Topic Worth Considering
I like Derek Sivers a lot. He’s perfectly quirky and embraces the benefits of doing things for the simple hell of it. He’s stumbled upon a few different careers, all driven by his incessant want to create, improve, and write. He writes on nearly everything, most of which he keeps internal while posting only what he deems ready. Over 10 years ago he posted this short bit, and as simple and intuitive as it seems, our planning is sometimes misguided. The answer can be often be uncovered and built in rather than anticipated and forced.
A new college campus was built, but one thing was still debated:
Where in the grass should we put the paved walkways?
Some people thought the walkways should go around the grass, to leave it green. Some thought the walkways should cut across diagonally.
One professor had the winning idea: Don’t make any walkways this year. At the end of the year, look where the grass has worn away. That shows where the students are walking. Then just pave those paths.
Brilliant.
I think about this idea applied to life plans or business plans.
As time goes on, we get smarter. We learn more about ourselves or our customers — what we or they really want. Therefore, we’re at our dumbest at the beginning, and at our smartest at the end.
So when should you make decisions? When you have the most information, when you’re at your smartest: as late as possible.
Like the college campus, you can do without walkways for a year.
Resist the urge to figure it all out in advance. Realize that now, in the beginning, is when you know the least.
When people expect you to make these decisions in advance, get used to saying, “We don’t know yet.” Then tell this simple story about walkways to show them how wise you are.
The more you know!
Some Cool News
I’m sure you’re now familiar with the term ‘Revue’ as you’ve been reading these newsletters, which makes sense considering they power and host each of them. The newsletter market is booming through the democratization of content and unbundling effects, allowing individuals like myself to push out newsletters like this 😃. Revue is not the only provider, as platforms like Substack have also gained considerable traction. But even within this targeted ‘Newsletter’ market, there are still needs that go unaddressed. Just recently, another newsletter that I had been following broke off from Substack to launch their own platform for delivery and content creation. It provides even more flexibility in terms of editing and targeting, unbundling beyond the initial layer.
Anyways, Revue was just recently acquired by Twitter! This is an interesting acquisition for Twitter, but makes sense considering the focus on fairly short-form media and posts, and the rising popularity of sharing and creation.
Making Twitter a better home for writers
Thank you all for reading! Until next week.
-SB
Update
I hope all of you who had money in Gamestop or AMC enjoyed the ride of your life. Yikes.
Short explanation of the debacle and how it played out
Taylor Offer on Robinhood
TD Ameritrade, Robinhood and many other stock trading services are blocking users from buying GameStop stock. This is a really big deal, here is why:
Citadel is a massive hedge fund that has over $35B dollars. They have massive short positions in GameStop, meaning they are betting the stock will go down. Retail investors, like you, me and the ones on Reddit are buying the stock and betting it will go up.
The stock has risen over 20x this month, from $20/share to $450. Retail investors like you and me have made a ton of money, but big hedge funds like Citadel have lost billions of dollars.
Now, trading platforms are blocking users from buying the stock FOR NO REASON. With less people being able to buy, the stock price will go down and the big hedge funds like Citadel (who have massive partnerships with the apps like Robinhood) will win.
Hedge funds have manipulated the stock markets forever, with their large sums of money they can drive a stock up or down. Now the retail investors have bonded together on Reddit to work together and the trading platforms are shutting them down.
People buy and trust stocks because they think it is a free market. It’s not a free market anymore. The apps are rigging it for the hedge funds.
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