[HN Gopher] Find the Fast Moving Water
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Find the Fast Moving Water
Author : simonebrunozzi
Score : 35 points
Date : 2022-12-26 09:29 UTC (13 hours ago)
(HTM) web link (www.nfx.com)
(TXT) w3m dump (www.nfx.com)
| PaulDavisThe1st wrote:
| Sorry, but I just don't give a fuck. Some of us like to sit on
| the edge of still lakes and ponds, maybe go for a swim, enjoy the
| sunshine, listen the birds and the rustle of the wind. We don't
| want moving water, let alone fast moving water.
|
| Put more explicitly: feel free to spend your life trying to get
| rich if that's what floats your boat. Feel free, even, to spend
| it searching for the excitement of rapidly growing companies in
| "fast moving water". But be aware that most of us aren't
| interested, aren't trying to live like that, and have a somewhat
| negative view of people who do.
|
| (See also: Siddhartha by Herman Hesse, in particular the ferry
| man)
| [deleted]
| bze12 wrote:
| feels like a variation on Andreessen's perspective that the
| market matters most in startups
|
| https://pmarchive.com/guide_to_startups_part4.html
| solardev wrote:
| I know this isn't really the point of the article, but IMHO it's
| more interesting... can you really measure water speed just by
| looking at surface turbulence? What do you do about fast moving
| but deep streams, or underwater current channels, etc.?
| ghaff wrote:
| Sort of. To a degree. In a real world environment things are
| never perfectly uniform but it certainly can be easier to gauge
| flow if there are things disturbing that flow or visible
| objects in the flow. Lacking references something like a tidal
| current can certainly be faster than is obvious. (And people
| obviously can get caught in rip currents that may not be
| apparent.)
| kutx989 wrote:
| I was wondering the same thing. I know surfers look for rip
| tides using the surface. I was hoping the article would be
| about computer vision tools for that
| mhh__ wrote:
| Under some conditions yes but presumably if you have a smooth
| flow at speed s and another at s*1.1 then you'd struggle.
| peterhalburt33 wrote:
| I was just about to say, I was slightly disappointed to find
| that this wasn't an article about a novel technique to identify
| fast moving water (akin to the fact that we can identify the
| temperature water by the sound it makes when it is poured).
| solardev wrote:
| It's one of those interesting examples where Hackernews's
| dual identities conflict... it's half "interesting
| engineering stuff" and half "startup culture stuff".
|
| In this case, the article's business stuff made my eyes glaze
| over, lol, but that random thumbnail and metaphor they used
| was really interesting. I wish I could find the source of
| that image... unclear if it's just a mockup that NFX made for
| the blog, or if there's an actual machine vision water flow
| classification project somewhere.
|
| My Googling is _really_ failing me this time. I can find
| articles (scholarly or not) on kayaking, water physics,
| machine vision... but not at the intersection of the above,
| and not any other instances of that image or lookalikes. Most
| of the AI projects out there are classifying aerial images
| from a bird 's eye view, at ocean scale, not "how fast is
| this water that I'm looking at from shore" scale.
| mhh__ wrote:
| "I'm here for one reason and one reason alone. I'm here to guess
| what the music might do a week, a month, a year from now. That's
| it. Nothing more. And standing here tonight, I'm afraid that I
| don't hear - a - thing. Just... silence"
|
| Margin Call
| 082349872349872 wrote:
| probably apocryphal, but I've heard "what's it doing that for?"
| is _the_ most common phrase found on aircraft black boxes. I
| always imagine that someone at LTCM, maybe not Meriwether or
| Merton or Scholes, but _someone_ , probably uttered that phrase
| at some point as well.
| vlovich123 wrote:
| This philosophy works well in truly competitive markets. However,
| fast-moving water can be artificially generated by throwing a ton
| of VC / IPO money at a market.
|
| > Three months later, we pivoted into video games on FB, grew
| quickly to $10M's of revenue that we didn't have before, and Saar
| was proven right
|
| How big are FB video games today? Zynga was purchased for $12.7B
| when Take-Two's market cap was ~$20B without really impacting
| Take-Two's market cap meaning that Take-Two purchased a company
| for $12.7B that the market valued at ~$0 (generously if we assume
| the following peak of $28B was the acquisition, then the market
| valued it at ~4B).
|
| My point is that "find the fast moving water" is a greedy search
| algorithm that is heavily distorted by private capital flows /
| band-wagon effect. That's why once a market sees 1 serious VC
| entering it meaningfully you see a massive cash flow as all VCs
| follow. That doesn't mean that it's actually creating value vs
| entrepreneurs rushing in to build companies to extract as much
| value as possible from the "dumb money" flowing in. This also
| sucks away oxygen from things that might be more durable ideas
| that are harder businesses to build.
|
| It's useful advice for finding personal wealth in VC markets. I
| do wish there was some kind of economic model that manages to
| meaningfully inhibit pure market capital churn while encouraging
| construction of durable businesses. Probably not possible in the
| VC space I suspect.
|
| Probably in this analogy, as other mentioned, we should be
| looking for fast moving deeper water / water that's likely to
| maintain a forward direction for a long time vs surface water
| churn.
| vkou wrote:
| > How big are FB video games today? Zynga was purchased for
| $12.7B when Take-Two's market cap was ~$20B without really
| impacting Take-Two's market cap meaning that Take-Two purchased
| a company for $12.7B that the market valued at ~$0 (generously
| if we assume the following peak of $28B was the acquisition,
| then the market valued it at ~4B).
|
| I'm not sure that's correct.
|
| If a company worth $10B pays $1B in cash to purchase a gold bar
| that's worth $1B, it's market cap should not change. That
| doesn't mean that the gold bar is worthless!
|
| Likewise, if a company worth $10B pays $1B in cash to purchase
| a company that's worth $1B... It's market cap should not
| change, either!
|
| The only situation in which the market cap should change is if
| the purchase unlocks some kind of new synergy between the two
| companies, that wasn't present when they were separate entities
| (Or if the shareholders think that the management of the buying
| company has gone insane.) But that still has zero bearing on
| the 'market value' of the acquired company.
| AndrewOMartin wrote:
| I thought this was going to be about a new style of CAPTCHA.
| mdorazio wrote:
| The most interesting part of this article to me is that the
| author inadvertently makes the case that being in the "fast
| moving water" isn't sufficient, and personally I don't think it's
| necessary, either. From the article, the author talks about
| thinking Cabulous was the fast moving water. It doesn't exist
| now. He was also impressed with Palo Alto delivery, but comments
| that of the seven delivery startups that year, only Door Dash
| survived. The pitch here seems to be "follow the herd and hope
| you survive".
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