College Strategy

I was invited to wok on a strategic plan for the college a few summers ago. I couldn't attend the workshop and lost an opportunity to help steer the college to a more promising future.

The final strategic plan, just like most of committee work, is a mumbo jumbo of catchy phrases in higher education, such as creativity, diversity, internationalization, social justice, etc. These are all fine things to pursue, but can hardly be called as ground-breaking strategic goals. In business, a strategy is to place a corporation in a position from which it can better compete in the industry. For example, on a strategic map with cost and quality as the two axis, many companies would try to go to the low cost/low quality end. To survive in the crowded space, you have to be a true leader in cost, which is hard for most businesses because undercutting competition is so easy and rampant that you can't always be the cheapest. In the higher education market, all these lofty slogans are also easy and rampant. How does our college out-compete others on these liberal ideas? I don't see them bringing in more students or elevating the college to a higher ranking.

The other way to compete is to differentiate. In commercial products, you differentiate by offering premium products and services or increasing the variety of products. How do you differentiate our college from others? Not by offering programs others all have, but by offering programs that others can't think of.

We don't compete with every college or university. So when we are creating programs, we just need to focus on those similar colleges' offerings. If we narrow down our primary market, we can see that we are head-to-head with other small private colleges. This is a shrinking segment. It is shrinking not just because public institutions grab our potential students, but also because small private colleges are losing their allure. A liberal arts education per se is not the root of the problem. Limited choices are the real threat to small private colleges. The world is changing fast. Parents and students want to have plenty of career choices when it comes to college education. Restricting the options to only traditional liberal arts programs discourage them from even taking a look.

It is therefore understandable for small private colleges to go into health care and business programs. But again these are easy choices. Any sensible college president would see that and take his/her college to that direction. But it is still not differentiation. The real game-changer is an engineering program. An engineering program added to our college will immediately separate us from the crowd. If you want to talk about critical thinking with fantastic career opportunities, what can beat an engineering degree?

Building a robust engineering program also balance the left-leaning tendency of any liberal arts colleges. Engineering faculty and students tend to be more practical and by default less likely to be liberal extremists. Liberal arts students prize their critical thinking ability, but often just fall into the bad habit of criticizing everything. Engineering students, on the other hand, are solving problems. Combining the two will create the best college environment for students to learn and grow. 

An engineering degree was briefly discussed in the summer workshop on college strategy. It didn't get traction. I wonder why. Could it be because the idea is too distant from our liberal arts tradition or because it is too pricey? But it is exactly for those reasons that we should pursue an engineering program. Apple doesn't sell a $1000 smart phone by making easy choices. We are talking about differentiating premium products here! Remember what President Kennedy told us? "We choose to go to the moon in this decade and do the other things, not because they are easy, but because they are hard."

I have confidence that if Coe could expand our offerings to include 3 to 5 engineering majors, our ranking can jump a few dozen places and probably be able to lose the "enrollment-driven" designation. Unfortunately, the ship has sailed. We are not building any engineering program. My only hope is that some day some wealthy alum can see this post and donate to the college with the condition of creating engineering majors.

Startup in Summer

I just brought back the entrepreneurial program at Coe by announcing Startup in Summer to all students. It was a great experience when I taught it as a regular class, but I wasn't satisfied with what I saw. I figure there were four things I did wrong.

  1. Demo Day and other PR events: I knew entrepreneurship was a hot topic, especially in higher education. I pursued fame and glory while what startups really need is a pure, no-distraction environment to work on products and prototypes that are liked by users. In Startup in Summer, we will have no Demo Day or any other type of PR events. They don't just distract the students and me, but also suck up all my energy.
  2. Wrong type of students: Entrepreneurship is designated as an elective for Accounting majors. More than half of my students in the Entrepreneurship class were Accounting majors. I like accounting students, but they are not the founder type. In Startup in Summer, all majors are welcome, but I will select students that are motivated to have a startup life.
  3. Group chemistry: Because students were allowed to take my Entrepreneurship without any permission, many took it without knowing what they signed up. Most of them came alone. I had to put them in groups that had no chemistry together. It was not healthy. In Startup in Summer, students have to form groups and be screened before joining.
  4. Dedication: During the semesters, the Entrepreneurship class was just one of four classes students took. They were not dedicated to building products. No dedication, no products. It is as simple as that in startups. In Startup in Summer, students will have just one job-making the product.

I hope my redesign of the entrepreneurial offering can have a meaningful change and bring about great Coe startups.

Post note:

The program is DOA.

A Solution for the Gender Pay Gap

A Google engineer just touched the untouchable in office politics by openly arguing that biological “differences may explain why we don’t see equal representation of women in tech and leadership.” However, the claim and many furious responses are mostly lack of evidence. It is understandable that people resort to emotional statements when an ideologically-rooted issue is discussed. But can “data” in gender gaps, say salary differences, offer insight to this debate? Unfortunately, the answer is no.

If we can have two people who are identical in their genes and life experiences, except for their gender, then the pay difference from the same employer can offer insight to whether there is discrimination or biases at work. All other data interpretations suffer the omitted variable bias. That is, there is always some other factors that we cannot document in explaining the difference. For example, we know skill can partially explain the pay difference, but to define and quantify the skill difference itself is an impossible task.

Even if we are able to control all internal factors, there are still external ones to deal with. Use my industry as an example. One of the possible reasons why female professors are paid less than their male colleagues is the difference in supply of female Ph.D.s. In disciplines such as sociology, plenty of female candidates with impressive c.v. and excellent caliber fight for very scare openings, while disciplines like accounting have a hard time getting any candidates. The colleges and universities will naturally offer higher salaries to accountants than to sociologists. Since women dominate sociology, but are more equally represented in accounting, the end result in higher education is a gender pay gap. But is it wrong for the administrators to save some money by having a pay gap? Hardly. But is there discrimination hidden behind the market force? We don’t know and will never know.

Nevertheless, data can still play a constructive role. Data, especially price data, are signals to suppliers and consumers. We should publish and publicize the gender pay gap. If the pay difference is caused by biases, it means opportunities for the executives who care about the bottomline to hire more female employees. If they are foolish enough to place discrimination above productivity, why get in the way of a natural balancing act? More importantly, the detailed pay differences across industries will guide aspiring young women to choose careers with better pay. That is the right way to get to the natural equilibrium without biases.

A letter to my first-year students

Dear Incoming Freshman,

I am your First Year Seminar teacher and academic adviser at Coe. I am honored to have you in my class and want to take this opportunity to welcome you and give you a brief introduction to the class.

First of all, I would like to congratulate you on picking Business Wars as one of your First Year Seminar choices. By choosing my class, you have already distinguished yourself from your peer. You have shown that you are one of the smart few who see business and professional training as a necessary part of your college life and career afterwards.

The debate on whether the college education should be liberal or professional has long been over. We need both. We at Coe are exemplary to this fantastic combination. But by professional, I don’t mean that college students should learn vocational skills like carpentry or law practicing. Instead, a professional education provides students with skills that not only transcend narrowly defined disciplines, but are firmly based on science and humanity. Studying business, economics and accounting in a liberal arts college gives you exactly that education. And my Business Wars class will give you a taste of what you can expect to receive at Coe. You will get exposed to Classical Greece by reading the Peloponnesian War by Donald Kagan. Then, we will bring the lessons in the Peloponnesian War to the modern business warfare. I am a strong believer in President Coolidge’s timeless words: “The chief business of the American people is business.” Knowing the business world through the lens of Classical Greece lays the foundation for any future career you might have in this great society.

The first semester at Coe is more than the First Year Seminar. You will probably meet the most important friend or partner in your life in the next few months. In addition, you will face academic challenges that you did not encounter in high school. Because of these challenges, I am hereby giving you the first college-level assignment. For the rest of your summer, you should read a book called A Mind for Numbers: How to Excel at Math and Science by Barbara Oakley. We will spend a lecture or two on discussing this book. It doesn’t matter whether you study science or business. It will simply change how you learn and how you see learning. It is indeed about time for you to bring your study game to the next level. 

Please take this letter as my greetings to you. We are about to start a wonderful journey together. I am looking forward to meeting you soon.

Sincerely,

Jay Chen

Elnora H. & William B. Quarton Associate Professor of Business Administration and Economics 

Dwight Hansen is retiring

My colleague and mentor Dwight is retiring. I have mentally prepared to give a retirement speech at his retirement party. But I know Dwight. He won't have a party for it. He is a man of faith and hence busy. He will move quickly to the next stage of life without looking back. So I type up my speech and put it here instead.

I was gonna reveal a big secret of Dwight. I was gonna tell you what Dwight and I always discussed in his office. (No, I am not sucking up to him, Rick) But Dwight is discreet. So I can't tell you the secret. He refuses to discuss certain things openly. On the surface, you might think that he is worried about being persecuted, but no, that's not the reason. He is respectful to other people. He is blunt, but won't hurt others' feelings by arrogantly shoveling his views into someone's mouth. That's his upbringing. I see the same respectfulness in Jan, Dwight's love of life, and James, their only son. What a great family.

What upbringing, you may ask?

First and foremost, Dwight is a religious man. Research has shown that people with faith are happier. I can understand why. A religious man thinks there is something bigger and more powerful out there than himself. So he is humble. A religious man is also not greedy because he believes there is punishment for that. How can a humble and modest person not be satisfied and happy, especially when he works so hard and has achieved so much?

What has he achieved, you may ask?

Dwight, together with Barb Larew, built Coe's accounting program from scratch. It is not just a couple of majors. It gives hundreds of students an opportunity to have a meaningful career. Many of them are practicing CPAs. Between Dwight and Barb, they have seen thousands of students through the gate and made sure they got a good first taste of business.

(Speaking of understanding business, I have to tell you the Mad Man story. I was an instant fan of the TV series Mad Man when the show started. Back then, I was young and stupid. I was so eager to have some people to talk to about Mad Man that I gave Dwight and Jan the discs and asked them to watch the show. That was arrogance. But Dwight and Jan watched it. They didn't just watch it. They binge watched it. He was amazed with the writing of the script. "How can they know so much about business?" was the comment Dwight kept telling me. Then we sort of started a TV-watching club, until the Boardwalk Empire's unnecessary sex and violence scenes got in the way.)

We don't know what a legacy Dwight and Barb had built until we started to find his replacement. For the first time, I am worried that Coe might not have a public accounting major. We are still hung on that possibility even after three different searches. It takes dedicated teachers who relentlessly put in efforts to make sure the rigor of the program is intact. Accounting is unlike most other disciplines in a college. Students eventually need to sit in the CPA exam, which has a high and consistent standard no one can just skirt around. Intermediate Accounting was always taught by Dwight. He insisted because he needed to be the gatekeeper for this important threshold in accounting learning. Once students got passed his Intermediate, they knew they have the confidence to go all the way.

At Coe, we academic advisers receive all advisees' midterm grades in the middle of a term, if they are at the risk of failing a course. I got so many D/F notices from Dwight's classes. Boy, was he harsh. But it was the bitter medicine needed. If students did not wake up to the fact that accounting is hard, they should consider other career options. Dwight demanded his students, but was always there to help them.

I used to have an advisee coming in to complain about Dwight. That was his first semester. He had Accounting I with Dwight. He complained about the class and the slow-paced office hours. We advisers collect stories like these, partly for future advising references and partly just for gossipy fun. So I took note of this episode. A semester later, the student replaced me as his adviser with Dwight. What a surprise! That is the real Dwight, who is demanding but generous in helping students. He wins students over with his kindness.

And with his humor.

For lots of students, accounting is excruciatingly boring and tedious. I never envy the job of accounting teachers. But the good ones have their ways of getting students out of the doldrums. Dwight sprinkled his lectures with his travel stories. He and Jan travelled every summer break; sometimes during the winter breaks, too. They have reached all corners of the world, but Dwight's stories were not just plain narratives of the trips. He added colors! A student once told me what Dwight said about a trip to Nepal. Vendors there were selling all kinds of oxygen cans. Many of them had exotic flavors. Dwight examined one and the label said, "Sex on the Beach." He shook his head and told his students that he could easily get that by bringing his wife to the oceanside. Later that day, students had an exam, which Jan helped proctor as Dwight always used more than one classroom. Students just could not shake off the story Dwight told them while looking at the motherly Jan in front of the room. Well done, Dwight.

I was one of the few colleagues who have read Dwight's travel log. He pokes fun whenever he can, even at James and his newly wed. I vaguely remember that he gave James impregnation advice, something like the aisle in the wedding chapel being a good place, etc. You get the picture. But he really could write. I repeatedly urge him to start a blog in his retirement. We will see how that goes when teaching is not part of his life.

Being funny sometimes got him into trouble. Jan hurt her arm pretty bad once. Dwight rushed to the hospital, saw the terrible wound, and almost cried. But once he realized the situation was under control, he started to goof around. He told the suspicious nurses, "She started it" (something to that effect.) They almost called the cop.

But he does not joke about his work.

Dwight is someone I look up to. He is one of the very few people I met that have the highest work ethics. Over three decades of teaching here, he took only one sabbatical leave, which we academics treat as perks and use when available. He came to teach on snow days when all kids hid in the dorm rooms. There was a time he checked into the hospital just to find out that he had appendicitis. It was almost life-threatening because of the delay in the ER. He had to cancel class, but wanted to go back to teach the next day. Thank God that the doctor talked him out of this nonsense. And, he tried to convince the nurses again that Jan had abused him, but to no avail, of course.

Dwight sets a good example for the younger generation. When people mention the modest, hard-working Midwesterners, I always picture Dwight. He is always honest. He doesn't take any job lightly. He wrote two letters for me for my contract reviews. Each time he asked to sit in my class. He took notes in the class, detailed notes I tell you. He then wrote a very nice, lengthy letter and gave me a copy before sending it out. His letters were nice, but didn't have any bogus claims. Everything is true to the tiniest detail. That is something I will definitely emulate in the future.

Kindness and integrity are what I see in Dwight.

Outside of work, I just see Dwight and Jan as two kind people with utmost integrity. When I had my gallbladder surgery, I asked them to be ready by the phone in case my wife needed to call for help. They didn't just do that. They offered to come to the hospital to be by my wife's side. They also brought us a nice meal because they knew we would not have time to cook. (Of course, we compared our surgical scars when they came drop off the food.)

Some people show their kindness once in a while. It takes a special personality to be willing to serve homeless people meals every week for decades. Dwight does that. He helps cooking at Green Square Meals every Tuesday for years. It is his faith, upbringing, and character that make Dwight the way he is, though sometimes I can't help but shake my head at his goofiness.

At the end of one fall term, Barb and I were communicating in email as we were at our first attempt to hire another tenure-track accounting faculty. Dwight did not participate for a while. I got worried, because that was not typical of him. So I drove by his house. The house was in dark. I asked the neighbors. They said they were home. Dwight opened the door promptly after I rang the bell. He and Jan were surprised to see me, but invited me in. It turned out that he was gonna phone us, but the couple were staying in after a long semester. They were just sitting in the couch, admiring the Christmas tree they just lit. I sat with them for a few minutes, hearing them talking about how a few international students who never decorated a Christmas tree helped erect the tree. I left and said to myself, "What a goofy, simple and happy couple!"

God bless them.

What type of teacher am I?

As one gets old, he establishes all sorts of rules. Some of these rules are the product of habits, while others are good guiding principles that help him navigate the complicated world. I have these guiding principles, too. One of them is how to define my role as a teacher.

Almost everyone has teachers. The teachers we remember come in various forms. When I was on the receiving end, I categorize teachers in one way. Now I am on the giving end. After observing the students and my colleagues, I categorize teachers in another way.

There are rigorous teachers, whose guiding principle is to make sure students work and learn from a class. Being friendly to students is not their strong suit. Students leave the classroom with a great deal of knowledge. There are, on the other hand, friendly teachers, who love to chat up with students and help them out whenever possible. They might not be the first-rate scholars, but are the ultimate motivators. Both groups of teachers leave imprints on students' mind. They change people's lives because they have their guiding principles. I belong to neither. But I also want to make an impact on students' lives. So I need my guiding principle.

I think I have found one long ago. Higher education is not cheap. What values do we add to the education we are selling? This is a much harder question than it appears. Believe it or not, that question has become my guiding principle in teaching. Any time I make a change or ask students to do certain assignments, I ask myself that question. I also review my courses frequently to see if I am answering to the question. I like what I do. I think the principle is working.

 

Rethinking Entrepreneurship Education

Silicon Valley is reinventing itself, again. But entrepreneurship educators in academia did not get the notice. This new Silicon Valley builds on the speed of product development. Both software and hardware startups now have access to technology that requires very little startup capital and allows fast prototyping. The Valley exploits the advancement in technology in its typical world-leading fashion: fast and furious. So in just a few years, we have seen the uprising of Lean Startup, a startup movement that focuses on building minimum viable products and fast customer/product feedback loops, Y Combinator, a startup accelerator that uses its expertise and network to quickly launch new businesses, and Andreessen Horowitz, a new venture capital firm that employs its partners’ insights and technology-disseminating ability to get involved in startups at all stages.

The underlying thesis of the latest change in the Valley is to use speed to tackle uncertainty. Startups are inherently uncertain and therefore risky. Traditional venture capitalists deal with the uncertainty by casting a wide net to diversify. One big win makes up for countless losses. The new Valley still diversifies, but new technology can help to further eliminate inefficiency. Venture capitalists and angel investors these days produce a large number of startups by speeding up the product development process. It is alright to fail as long as the startup founders fail and get back on their feet quickly.

On the other hand, entrepreneurship education is stuck in the old mold. A typical entrepreneurship education in college or business school offers an introduction to the startup process, an incubator, internship opportunities, and year-round business plan competitions. Many schools give out certificates or even degrees. The result? An outright F. Exhibit A is the absence of blockbuster startups coming from any certificate/degree program. Those successful founders that have any tie to an entrepreneurship program most likely could have found their way to the Valley regardless.

The problem with the entrepreneurship education is how academia tackles startup uncertainty. Because it is hard to show success, let’s not focus on the measurable outcome. Let’s just emphasis the awareness we create, the community we build and the palpable sense of giving we together feel. So instead of unicorn startups, we have many marketing campaigns and a bunch of social entrepreneurs. 

This is a shame. An entrepreneurial project can be a perfect capstone for a liberal arts education. What produces a better learning outcome than doing a real product that requires extensive knowledge of science and humanities? Entrepreneurship educators should realize that entrepreneurship is not teachable. We are just there to guide the interested students through the startup process and help them connect with resources. An ideal entrepreneurship education should embrace the current changes in the Valley. It only requires a co-working space, a little money to access 3-D printers and cloud computers, a few field experts in residence, and the lean and fast spirit that fosters a learning-by-doing mentality.  As Paul Graham, the founder of Y Combinator, wrote, "Entrepreneurship is something you learn best by doing it.”

 

When honesty is not the best policy

Honesty is not always the best policy. I observe this from some students I have. A student of mine in the past wrote to me in the beginning of a semester, "My father surprised me and my brother with a trip to Hawaii as our Christmas gift and I will not be returning to Iowa until late in the evening on Friday." He wanted to be excused for a week because his family planned to have a leisure trip to Hawaii. What a surprise, indeed.

He probably thought that by telling me the truth, he'd followed the suggested conventional wisdom. No, what he really reveled was his arrogance: I am going to have fun during the school time and I don't mind telling you that. Why? Just because I can.

Show some respect for the educator and the education you pay good money for. At least come up with some white lies, if you really want to be excused.

Inside the black box

Keynesian economists like to talk about the paradox of thrift, a form of paradox of aggregation. In their belief, it is good for a person to be thrift, but in aggregation, saving too much means too little consumption. The economy won't grow if no one spends. I think this idea is ridiculous because there is no real person in this conjecture.

When I was studying chemical engineering in college, we were given a task to design a unit in a chemical plant. It was a crazy idea to ask college kids to do this, and, of course, I forgot everything I learned by now. Well, except one...

We were told that a reaction that works in a lab might not in a real plant. When you scale up a reaction by multiplying the amount of compounds you put in, sometimes it explodes. We were told that heat generated in the reaction is the culprit. You need to stir the reaction tank constantly to make sure heat dissipates. Once you take care of the heat problem, the same reaction happens smoothly. So there is no paradox of aggregation. We chemical engineers know what happens inside the box when we scale the model. But Keynesian economists don't know that. They watch the tank explodes and think, "uhm, things don't work in aggregate the same way as individually." Then they take that explosion as given. After decades of advance in macroeconomics, mainstream macroeconomists have already looked into the box and know what is going on (heard of price stickiness, New Keynesian models?) No matter. Keynesian economists plow on. They keep tell you government spending is the way forward. You don't need any real person making trade-offs in the economy. Government spending eases all the pain.

OK, here is the solution to the paradox of thrift. People react to incentives. If the price is right, people will buy stuff, instead of saving. When the business faces difficulties in selling to thrifts, they will lower the price. That's the price adjustment mechanism. That's the heat dissipation mechanism. There is no paradox. There are only rational people. Got it?

Entrepreneurship is neither a movement, nor a campaign

YC's Sam Altman tweeted early this month that startup accelerators are part of where there are bubbles. I agree, but I also believe this bubble reflects an ominous trend in entrepreneurship in America.

Entrepreneurship has been turned into a social movement or a marketing campaign. It is hijacked by activists and marketers. So we see people are "promoting awareness of entrepreneurship" and "making social entrepreneurship an integral part of community building." A great capitalist idea is now being abused. There is NO social entrepreneurship!

Activists and marketers are sprinting in a marathon. Even worse, they run, but don't care about the minutes and the seconds between the start and finish. They care about how people view their running, what clothes they put on, and what messages they deliver. So they spend resources on things that are least related to running. They drag entrepreneurs into showmanship. They see audience, while entrepreneurs need customers. When they are done with this movement or campaign, they move on to the next. But entrepreneurs are creating a business, a long-run enterprise. They are here to finish the whole 42 km.

So I think if an accelerator is to avoid the fate of crushing of the bubble, they need to go back to the basics: help entrepreneurs to create a product that has a market. Anything beyond that is fluffy and useless, even financing.

Be careful with startups burning cash like this

I was surprised to hear FanDuel's radio commercial in the program from our little local station. If I got to hear them in this town in the Midwest, imagine how much money they have spent on blanketing the nation. That's not how you use your hard raised a-, b-, or c- rounds. It is not effective and only helps you reach the wrong audience. It might be a sign of too much money going into startups, but could easily be an idiotic management team running the company. Time will tell.

Those are God's words

In the beginning of the entrepreneurship class, I always tell the story of Bob Noyce. The legendary Intel co-founder's connection to Grinnell College is the point. I am always hoping our College will produce a Bob Noyce and I be the helping hand.

But there is more to Noyce's story. I recently bumped into this 1983 profiling by Tom Wolfe. It was a long story. Middle way through it, I found myself having hard time holding down my tears. I couldn't figure out why. Not those usual suspects that move me to tears. I felt there were some connections between me and those Silicon Valley greats. Those are God's words, I suppose.

The best ever

When I was on the economist job market a few years back, I heard of lots of legends. Here is one example. A teacher of mine told me that this guy got a letter from his adviser, with one sentence that most people can only dream of: he is the best student I've ever had. It looks like that he didn't let his adviser down.

I just had the honor to write a letter like that for a student of mine. Very proud.

Student payback time

It's the time of the year to read student comments from last semester's evaluations. There are aspects that I need to work on, such as more timely return of problems sets (I prioritize exams over homework) and more in-class exercises. The good thing this time is that there are no hateful comments. Since I "invested" the most in my entrepreneurship class, I was especially nervous about what they had to say. All great. Here are some excerpts:

"Had a great time in this class. I hope that many students take the course. It is a fun, yet challenging course. Jay makes the course perfect by breaking down each step of the entrepreneurship process. Keep up the good work, Jay, and thanks for all your help and support." 

"Great course. My favorite class I've taken in my 4 years at Coe."

"This class gave me the opportunity to apply lessons and information I have taken away from all of my other business courses. It really allowed me to apply the knowledge I have gained the past three years while also challenging me to learn more. I think the continuous research that was done was difficult at the time, but improved me as a student."

"The creating of a startup allowed for me to understand different aspects of a business. Deliver clear message and understand customers. Speak in front of a group. Prepare a presentation. All of which are good skills."

 

High-speed rail must be an upgrade

I have been wondering why high-speed rail doesn't take off in the U.S. I finally came to the conclusion that high-speed rail is not an upgrade for Americans. The excitement people used to have when trans-continental railroads were built is not here anymore. People got excited 100 years ago because they got to move across country with a new level of comfort, speed, and convenience. People loved trains because the alternative was horse-drawn wagons.

Now if you want to travel long distance with trains in the U.S., it is a downgrade from the alternatives, not upgrade. Airplanes get you to the destination faster and cars make sure you can move around in the destination. Trains don't have the speed and the connection network. That is why the only place in the U.S. that high-speed rail might work right now is in the northeast corridor. That is also why the California experiment might fail. Say, you take a high-speed train from S.F. to L.A. How are you going to move around in L.A.?

But if we keep this upgrade/downgrade idea in mind, the solution might not be too hard to find. A high-speed rail network with better Uber/Lyft connection is what I think of right now. Or maybe the $40-billion plus Uber can build its own high-speed rail? I never underestimate the power of technology.

 

Don't argue with the market

It is not just true for investors, but also golden for corporate executives.

I am talking about the fast food giant, McDonald's. It finally decided to reduce the number of items on the menu. I think the decision was too late and too little. Most importantly, I think the CEO still doesn't get it. He is arguing with the customers and the market. Look at what he said in an interview with Fortune. He thought people didn't get McDonald's. Customers didn't get the quality and integrity of McDonald's food. Too bad. Perception is reality.

In startups, we try to find the product/market fit. If there is no fit, we pivot. We don't argue with the market. I know it is hard for the elephant to turn around, but the elephant here doesn't know it has to turn around!

From Fortune Magazine

One step away from the center of the world

Wrapping up this term's entrepreneurship class, I suddenly realized that doing a startup is such a great thing for a young person that it puts him or her just one step away from the center of the world.

If you are an entertainer, you must be extremely talented and lucky to make it to Hollywood or Broadway. Being just one step way already takes a tremendous amount of lucky events. The same for a Pulitzer prize winner, Nobel-caliber scientist, billionaire on Wall Street, or POTUS. It is almost impossible for people to wish for it, work on it, and for certain to get it in those trades. 

Silicon Valley is different. I don't mean the physical Silicon Valley, but the Silicon Valley mindset startup founders all have. If you go through the process I had for my entrepreneurship students, you are literally one step away from making it in the de-facto Silicon Valley. And that last step is totally surmountable. 

So, why are you still hesitating?

Am I a mean person?

Paul Graham's essay, Mean People Fail, stirred up a debate in the tech circle and got me thinking. I always consider myself as a blunt, no nonsense person. I hate pretenses. I don't like to say things that are against my heart. Are these personalities the same as being mean to others? Steve Jobs was called a mean person million times over. Was he mean or just blunt?

There must be a difference between being mean and blunt. For the mean people, meanness itself is the goal. They want to hurt you and the act of hurting you is satisfying by itself. On the other hand, being blunt is to get things done quicker and more efficiently. You see, here getting things done is the goal. Your being hurt by blunt language is only the collateral damage.

I don't want to hurt people, even those I hate very much. I just wish them to go away. I don't want them to live a miserable life. I guess this general attitude proves that I am not a mean person. Of course, hurting other people is bad no matter what your intentions are. So I am constantly learning to deliver blunt words in a much more acceptable way.

The Saudis want the price of a barrel of oil to go to $70

Forbes has a nice piece on the "new bond king', Jeffrey Gundlach. We don't need another rich bastard to tell us how to live our lives, but there is a reason why the media loves them: they can talk without holding anything back.

I especially like his view on macroeconomics. For example, he said, "With a tightening, the dollar is going to not just be strong, but it will run up like a scalded dog. If that happens, then commodity prices are going down, we will import deflation and you will see an episode of deflationary scare." 

What really got me thinking is his oil prospect: "I am convinced the Saudis want the price of a barrel of oil to go to $70. They don't care if they run a short-term deficit if it slows down U.S. fracking and turns the screws on countries in their region that mean them harm." I don't think fracking will stop. Technology will only make the break-even price lower. But the Saudis can really "screws" the Iranians and Russians. If Putin loses his power, he should know who to blame.

Curated content lost in one-liners

As I follow more and more people on Twitter, the time I spend on it increases. Although it doesn't take much time browsing through one-liners, quotes of the day, and pictures of others, the time adds up. To save time, I also don't jump into conversations that much. Still, it takes away a big chunk of my online time. The worst part about having too many people to follow is that it dilutes the thing I really like about Twitter: curated content. For example, Andreessen has great tweetstorms from time to time, but those are not why I like about his tweets. I like the links that he "endorses", stuffs that get me thinking. But to see his curated content, I have to endure tons of fragmented one-liners, part conversations, and sometimes ironical jokes. 

Maybe I should really decrease the number of people I follow. I can handle one Marc Andreessen, but there are plenty of Andreessen wannabes out there. But they are NOT Andreessen. We all should know what we can and what we can't do.

Or there are some applications that can aggregate curated content from Twitter (reddit? Hacker News?)