Michael Lewis was shadowing SBF well before the FTX implosion, and clearly meant to write a book about crypto and why it had grown so much. And he didMichael Lewis was shadowing SBF well before the FTX implosion, and clearly meant to write a book about crypto and why it had grown so much. And he did a great job at that. He was also perfectly situated to explain FTX's downfall, which has been well covered in the press but if you didn't follow that it was a good overview.
However, this book got a LOT of flak in the press and here on GR because on the BIG QUESTION of whether Sam was a crook or just an ignorant idiot who couldn't keep good records and over levered himself, he doesn't take a strong stance, and pretty much leads one to believe the latter. He never found a smoking gun saying Sam explicitly decided to invest customer funds. And yet he did, to the tune of $8B, half the deposits. And the end of the book he even states that the money was actually all there, just spread out in many different illiquid investments. Obviously just investing customer funds in all kinds of risky investments was itself fraud. But he more portrays Sam not as a person caught in a trap and making the decision to cross some moral line, but rather just such a weird, odd person that didn't pay attention to details as he was making so much money. This is the crazy thing - FTX was a highly profitable business - he didn't need to steal funds. It wasn't a pyramid scheme or anything like that. This left me with a unsatisfied feeling wanting to know more of his motivation. But his conclusion was kind of just: Sam is so odd, nobody can read him.
I have a new appreciation of what high frequency traders like Jane Street do in traditional markets, and why their algorithms applied to crypto were so profitable in the boom, because there were so many tokens and opportunities to find inefficiencies in the markets.
Sam was a weird dude, and really it's amazing so many people were so impressed by him. The fact that he would for instance play video games while on zoom calls with important people, is just disrespectful. Sam was clearly a person who had zero empathy for others.
It was interesting to learn that Alameda got its start with some loans that had 50% rates. And then once they were off the ground, they switched to borrowing money from crypto networks like Celsius, which promised people insanely high interest rates. This was a big piece of the house of cards.
One of the most interesting things I didn't know before this book was that FTX was founded by and backed by Effective Altruists (EA's). I guess if you are going to go into the business of making money in Wall Street or crypto and want to feel mission driven, this is what you do: you pledge to give a lot of it away to charity and thus the more you make the more impactful you are on saving the world. Thus, permission to go chase money. I'm knocking it a bit, I'm sure there are many legit EA's. But on the other hand, imagine what could have been invented if these smart kids had put their minds elsewhere.
"The smartest minds of our generation are either buying or selling stocks or predicting if you’ll click on an ad,” he said. “This is the tragedy of our generation."...more
Brian Johnson is my favorite teacher philosopher that is living that I've read/listened to. I've been following his newsletter and +1s since I met himBrian Johnson is my favorite teacher philosopher that is living that I've read/listened to. I've been following his newsletter and +1s since I met him in a cafe in Santa Monica in ~2007. I've consumed countless of his Notes (book summaries) and 101's on my journey, and have found his recapitulation of the masters, and just his *energy* around the topics to be infectious and immensely helpful. Brian is food for the spirit, and I can't wait to read this....more
Elon is a fascinating and unique person in our universe, and Isaacson has done another masterful job explaining his story. My main takeaway is that itElon is a fascinating and unique person in our universe, and Isaacson has done another masterful job explaining his story. My main takeaway is that it's amazing that Elon went in and re-engineered not one but two entire industries to create something new that was a fraction of the cost of prior efforts. With SpaceX, he made rockets at 10% of the cost because the governments cost-plus accounting plus lack of innovation in decades meant that rockets were ripe for reinvention and nobody knew it.
I loved learning about Elons methodology, such as that if the difference between the cost of materials of a part and it's purchase price was too high, then take it back to the drawing board. Amazing to read about him creating rocket engines at 1/10th the quoted price.
Elon is maybe the only person in the world who continually goes "all in" on every big hand. He's focused on going big because it's the only way to achieve his mission driven goals (get to mars, get off oil). For instance, not many people in the world would have made this bet:
I loved the relevation that Elon loves video games, and kind of views life as a video game. It explains many of his moves, and perhaps the way he can just turn off emotions and for instance lay off 80% of a company - it's a move he'd make if he were trying to win in a video game.
However I do worry that with Twitter, his approach to re-engineer it won't work. Social Networks are built upon layers and layers of network effects and if you undo those it does nothing but set you back. Twitters brand for instance is one of those. His Twitter saga to me read a little like it sounded like a good idea, then he tried to back out, but then he couldn't and so decided to apply the same playbook. The only thing that might save him is that Twitter's network effects are more powerful than most people think.
Still despite the Twitter saga, Elon doesn't deserve the negative press in mainstream media that he gets - SpaceX is the one of the largest private companies in existence right now and Tesla is one of the most valuable car companies. He's hardcore, and impressive. ...more
A spellbinding story, highly recommended. Despite having read lots of headlines about the "opioid epidemic" I really appreciated and enjoyed learning A spellbinding story, highly recommended. Despite having read lots of headlines about the "opioid epidemic" I really appreciated and enjoyed learning more about this.
For instance, I had no idea that OxyContin/etc are just basically heroin with some time delayed engineering in the pill, which can be undone by crushing the pill. No wonder it took off. It's a case of big business having the lobbying power to buy their way into seeing an illegal drug made and sold legally.
I found it fascinating to learn about how vertically integrated Arthur Sackler built his empire. He owned or backed/controlled the media companies that created the narrative on the drugs that he made. He made Valium huge, then his own drug (Oxy). No wonder he was able to dup the world. Reminds of the story of sugar in The Case Against Sugar.
But one of the most amazing things about this story is the timeline. It took ~15 years between when Oxy was revealed to be bad for people to when something was done about it. And even now, it continues to be given out. And then when something was done, it was going after the profits the Sacklers made. And they will leave the process as still billionaires...
I wanted to better understand why so many smart people think Bitcoin, and more to the point, decentralization, are going to be so huge. This seemed liI wanted to better understand why so many smart people think Bitcoin, and more to the point, decentralization, are going to be so huge. This seemed like a good thing to read as it's always good to get the fundamentals. I remember when I started working on the internet I read the original white paper on Google's Pagerank, and I think that is still a highly relevant document. I would bet this whitepaper will in 20 years be on the same order of magnitude - perhaps even more so.
For instance, before reading this my mental model was a bitcoin is like a digital dollar. But now, I better understand that a coin is really a chain of digital signatures.
“We define an electronic coin as a chain of digital signatures. Each owner transfers the coin to the next by digitally signing a hash of the previous transaction and the public key of the next owner and adding these to the end of the coin. A payee can verify the signatures to verify the chain of ownership.“
It was really clear that Bitcoin was created and designed for the purpose of facilitating electronic transfers in a better way than exists today. If you buy something in cash, your transaction is over. If you buy something with a bank card or credit card, that transaction can take days or weeks to finalize because it can be disputed. This "trust based model" has a whole range of downstream impacts that makes moving money around slow, not to mention sometimes costly.
Bitcoin is a protocol and this shone through in the paper as well. It describes how the blockchains and timestamps work, as well as the network nodes, and how the whole thing is secure with enough nodes. Some smart people I've heard have often compared Bitcoin to other protocols like SMTP.
Fascinating telling of the last 20 years of the journalism industry, through in depth looks at four companies: The New York Times, the Washington PostFascinating telling of the last 20 years of the journalism industry, through in depth looks at four companies: The New York Times, the Washington Post, BuzzFeed, and Vice. I knew a lot of this having followed and worked on some of it (eg social media rise), but I still learned some things that made the book worth it. I also didn't agree with the way she characterized some of the things I knew about.
The story of the news industry in the last twenty years, is one of managed decline. The Posts revenue was ~30% of what it had been when Jeff Bezos purchased it, and their newsroom had shrunk by almost half. Similar trend for the Times. Print circulation provided all the revenue but it was declining, digital was growing but providing no revenue, and classified advertising, which used to account for ~40% of revenue, was taken almost entirely out by Craigslist, Monster.com and the internet. Shrinkage led to a shortage of young people working there, and a lack of a culture of innovation.
In recent years, the Times, Post, WSJ, and others have finally figured out how to embrace digital and make digital subscriptions work. Maybe people just needed a decade or two before they were willing to pay for online content, or maybe the publishers could have innovated faster, it's a very interesting question - but I tend to think innovation could have been much faster (but not overnight). But as of mid 2020, the NYT has 6 million subscribers, who provide 64% of their revenue.
One of the themes the book talks about a lot is the separation between church and state in a newspaper - the notion that advertisers should have zero influence over what journalists write or cover. Church and state have been separated for a long time for a good reason - if they aren't, the truth can be hidden by paying money. But the declining legacy print business and the loss of classified meant better online advertising needed to be figured out to save the papers. And upstarts like BuzzFeed and Vice led the charge in figuring out what it looked like - basically an in house ad agency that produced fully native advertising. These articles, which were paid for and thus positive, were mostly clearly marked but not in obvious ways. Church and state got intermixed, and the result at Vice and BuzzFeed has been that advertisers can control content. Less so at NYT/Post, but still a tension that you have to believe influences things.
But the biggest issue is that with online, we have ability to measure clicks, and clicks mean pageviews which mean ad dollars. So now we live in a world where editors value content that generates clicks, and a scoreboard can be created. Impressively, at Buzzfeed salaries were tied to how many clicks a writers pieces generated. And while the editors at the Times knew that human judgement mattered more as to what news people should know, even there clicks started to rule the day.
If even the NYT falls to clicks, and BuzzFeed/Vice/HuffPo/etc are all about clicks, this leads us to content that is good at getting clicks. More specifically, content that plays on our emotions, usually fear, anger, outrage. Steven Pinker's book Enlightenment Now talked about this trend. And then things like this can happen, where someone good at making clicks comes along:
I think clicks are the wrong metric. And optimizing for that metric has led our media industry astray. You combine that with a publishing industry that is cutting costs and thus not innovating as well as having to cut quality checks, and it explains a bit why the media is now so polarized and not as trusted as "the newspaper of record" should be.
And it's not just clicks, social media engagement is not the right metric either:
Side note on Vice - I must have not been in the target audience for them, and while I know I have occasionally read things on their website, I was wholly ignorant of their story, or the fact that they had and have a big video arm on YouTube and HBO - I don't think I've ever seen any of their videos! I guess I was never counter-culture... but I was glad to learn their story.
Side note - the author Jill Abramson was accused of lifting some of her passages from magazine articles about Vice/Buzzfeed/etc, and not crediting the original source. It looks like this is true for a few paragraphs at least, but the overall narrative constructed is not plagiarized, so I don't think this is a big deal at all in whether or not to read or trust this book....more
Scandalous, riveting, and well reported. I tore through this in a weekend. This is an unbelievable story - I literally cannot believe how so many peopScandalous, riveting, and well reported. I tore through this in a weekend. This is an unbelievable story - I literally cannot believe how so many people were duped by this company. It's a story of a Stanford grad dropout who had a vision, and an uncanny ability to make others believe her, and as the pressure piled on, as she started to be compared to Steve Jobs, and get accolades like "first female self-made billionaire", she started to cheat. I'm sure it started small at first - the story of this company spans 10 years, so it's really the story of a boiled frog. But the lying and deception and how she got so many big name people on her board and advising her (Larry Ellison, Rupert Murdoch, Henry Kissinger, George Shultz, James Mattis) is simply amazing. Of course, none of those people know anything about biotech companies, so it's also a story about investor optimism (and lack of due diligence).
Fascinating portrait of da Vinci. I learned a ton from this, but my biggest takeaway was how insanely curious about EVERYTHING Leonardo was. He was a Fascinating portrait of da Vinci. I learned a ton from this, but my biggest takeaway was how insanely curious about EVERYTHING Leonardo was. He was a painter, but also viewed himself as a scientist and engineer. In his pursuits to understand human proportions he dissected hundreds of animals and humans, to learn about muscles and eyes and how everything works. He understood how the eye sees in the 3D hundreds of years before anyone else. But the craziest part - is he published none of it. He wasn't looking for fame or respect from peers. He put a lot of it in his notebooks, which Isaacson based this book off of - but he would literally go on year long tangents (eg to understand perpetual motion) - just because he was curious. To me, this speaks a lot about the power of curiosity.
I had no idea that there are only 15 completed paintings attributable to him. He had a ton of unfinished projects, but this is also because he was a perfectionist and also a scientist. We all the know Mona Lisa - but I didn't know that he was commissioned to paint it, and spent 20 years trying to perfect it, up until his death, never delivering it to the person who had ordered it!
Isaacson talks at one point about how he is fascinated with the intersection of unrelated disciplines, and that's what drew him to Steve Jobs and Apple, as he famously merged technology and design. Intersections can help you think differently, and Leonardo was impressive at this.
Amazing book, must read for anyone who has to make decisions in life - that means everyone - but I think the more impact your decisions have the more Amazing book, must read for anyone who has to make decisions in life - that means everyone - but I think the more impact your decisions have the more useful his frameworks are. I'm giving it 5 stars for the big ideas and uniqueness of them - though I will warn you that the book is very long and highly repetitive - there is probably a way to read only parts of it and still get all the big ideas. Also (as I do for most books these days) I read it with a combo of Kindle ebook and Audible, and Ray reads the first half of the book himself, and given that part is more backstory/bio, It's much more powerful to hear it in his voice.
Dalio was successful because he timed it perfectly - he was one of the first to apply computers to investing. He also along the way invented what we call a "hedge fund", which is only possible to do well if you highly leverage computers. He leveraged computers heavily, turning all investment decision making he could into algorithms. He found this worked so well, that he attempted to turn ALL decision making into algorithms - this book goes into personal (life) and management (work) algorithms (aka principles). This is one of the more interesting ways Ray approaches life - he is trying to turn all his life into algorithms:
In order to do this, Ray believes strongly in having "radical transparency" and being "radically open minded". I think these sections are worth reading if you don't read the whole book (worth re-reading too). A transparent culture means everything is shared: metrics and data (how the company, or teams are doing), what is said in meetings (all meetings are recorded at Bridgewater and anyone can access the recordings later), strategic issues (like if they are considering a merger of one group), and even what people are like.
Bridgewater has opened sourced a big piece of people management - what people's strengths and growth areas are. They use personality tests as well as input from others in the company to assess this, and then put it on "baseball cards" for each person, which anyone in the company can see. He describes how useful these tools are when creating a new project team, to make sure you have a balance of the right skillsets and types of people on it, and how without this many people are just naturally likely to pick people like themselves. This way of operating is so interesting and different that many notable phycologists (Eg Adam Grant) have gone to study the Bridgewater culture.
Once you know who is good at what, it becomes a way to de-risk decision making in a meritocratic way. People who score high at things (aka are more "believable") get more weight in their opinions on things in that area. Most of us do this intuitively (ask and listen to those who know about something), but having a system to enforce that will catch a lot of cases where it isn't happening. Thinking about where this might go if expanded more broadly is a bit interesting - feels like it could really turn into gamified decision making.
I haven't read a non-fiction book this engaging in some time. This was an amazingly well written autobiography. It read like a fast paced novel througI haven't read a non-fiction book this engaging in some time. This was an amazingly well written autobiography. It read like a fast paced novel through much of it. Many autobiographies are too long - this one if anything is too short! Like many startup companies, the story of Nike (or Blue Ribbon Shoes as it was initially called) is one of trials, tribulations, and lots of passion and grit. I ate it up, and highly recommend it.
The most defining moment of the story is Knights ballsy move while backpacking through Japan at the age of 24, to walk into a Japanese shoe manufacturer and say he has a shoe distribution company, and get a exclusive deal for the western US. Gutsy. He "just did it" (sorry, but apt). I love learning examples of this kind of "Do things that don't scale" start to successful companies (eg Zappos, Amazon, many more). From there the story is one of doubling sales each year, and never quite having enough money on the balance sheet to make it anything but very risky. It was interesting - no fascinating - that Phil had an accounting background, and was well versed that the reason most startups fail is a lack of cash reserves, and yet he had so much faith in his growth and sales that he kept plowing all cash into growth. I loved reading the stories of how they barely made it from one order to the next, how twice they had to switch banks after being cut off.
One of the key strategies of Nike's success today is athlete endorsement, and it was interesting to see how that strategy was formed in the early years. How they would offer large sums of money to athletes to wear their shoes - often to athletes already wearing their shoes - double down on people who already like your product. It was doubly interesting that Phil didn't initially believe in the power of advertising - I'd be very curious to hear how his opinion on that changed over time.
The story of Prefontaine was a touching one, and one that stayed with me. I wasn't as familiar of the story of Pre, but had heard of him. But I didn't know the role that Nike sponsored him, and even employed him. Reading Phil talk about him, you got a sense of the passion his has for the sport of running. You got a sense that the story of Pre - his passion and drive - is a metaphor for how Nike was built. This quote says it better:
The book is a fascinating telling of the founding and early history of Nike. But it stops at the IPO, and then gives a chapter postlude. This is my only complaint. It was so well written - keep going! Tell us the story of Just Do It, Air Jordans, and so many more. I could read 4 more volumes of this, as it feels like there is so much more to they story of Nike to learn....more
Kevin Kelly, who is a Wired co-founder, lays out technological trends that are "inevitable". Like too many nonfiction books, I found a few chapters toKevin Kelly, who is a Wired co-founder, lays out technological trends that are "inevitable". Like too many nonfiction books, I found a few chapters to be worth reading, and a few not to be. I enjoyed the sections on AI and books. And sometimes just zooming out to get bigger perspective is engaging, which was the case for me in the sections on VR/AR and tracking. Much of the rest of the book seemed geared for people less technically savvy, which was my only complaint as it really drew the book out.
There is a famous saying in software said by Marc Andreeson that "software is eating the world". Kelly predicts, I believe correctly, that the next phase of this will be AI: "It is hard to imagine anything that would “change everything” as much as cheap, powerful, ubiquitous artificial". Kelly's perspective here that while it might feel like innovation in technology is slowing to some, it is much more likely that we are on the brink of the next renaissance, and we will all be "taking X and adding AI", much as happened with electricity and then the internet.
Kelly correctly identified the three key trends that are making AI an exciting space today: processing power (GPU's), data, and better algorithms. However he didn't dive more into the longest pole: how to get a lot more data than we have today - that seems to me to be the key. But cool to get an overview. He did address one of the big fears about automation that many people have today: will computers take all our jobs? The quick answer is yes, but we'll have new ones. This has already happened multiple times in history. I agree with this, but think the more interesting question is what will happen when we can provide most people the basics (food, water, shelter) for very little cost. This was predicted in Diamond Age, and the answer was "parking lots and chaos", and a lot of people with no purpose in life.
Another big idea that Kelly hits on that I think is big and inevitable is how each book will become networked, much as the WWW has. Once we have ability to have pointers into and out from each sentence of a book, the speed at which ideas will fly out of books will step function.
A fascinating book about community and belonging, and how modern society has moved us away from our roots in potentially signifiant ways. The book opeA fascinating book about community and belonging, and how modern society has moved us away from our roots in potentially signifiant ways. The book opens with a thought provoking fact: in early America, there were numerous instances of white people joining primitive, native Indian societies - but zero instances of the opposite, because "the intensely communal nature of an Indian tribe held an appeal that the material benefits of Western civilization couldn’t necessarily compete with."
The book also argues that the wealth we enjoy in modern society is isolating, against the grain of millions of years of our evolution, and can lead to depression, because our happiness is in large part rooted in a need to feel connected to others. While this feels right and intuitive, it doesn't seem to be the way we are optimizing our lives.
"A wealthy person who has never had to rely on help and resources from his community is leading a privileged life that falls way outside more than a million years of human experience. Financial independence can lead to isolation, and isolation can put people at a greatly increased risk of depression and suicide. This might be a fair trade for a generally wealthier society— but a trade it is."
Another loss the book points out is the loss of the transparency and social justice that being in a small community used to bring. When your neighbors and community members all know each other and what is going on with each other, group peer pressure tends to reward good actions and punish bad ones. The book points out that people wouldn't for instance cheat unemployment if their neighbors were paying for it and everyone knew what was happening. In anonymity we have lost a sense of responsibility to each other.
Amazing to get a glimpse inside the world of one of the more interesting people alive today. Elon has his faults, but in an era where a lot of entreprAmazing to get a glimpse inside the world of one of the more interesting people alive today. Elon has his faults, but in an era where a lot of entrepreneurs are working on problems that can be described more as "making money" and not "making the world better for humanity", Elon is uniquely trying to solve some of humanity's biggest problems, and he doesn't care at all about making money. He is mission driven on solving our dependence on oil (Tesla), removing our dependence on this single planet (SpaceX), creating clean energy (Solar City), improving transportation (The Boring Company), and more. These are all problems that desperately need solving, and are hard but not impossible to solve.
And he is sincere in being focused on the mission and not generating profits. For instance, Tesla's mission is to reduce dependence on oil, not build a valuable electric car company. Thus, Elon open sourced all their patents and technology so that other car makers could use it too. Admirable.
One of the things that I learned and admired about Elon is that when he gets interested in something he just goes deep on the subject until he knows everything about it. He did this at the start of all the businesses he's started - he went and learned everything there was to know about space and rockets, or about electric cars. This gives him a huge advantage and base of knowledge in starting something because he knows the underlying physics and economics of the space. I like this approach :)
One of these deep dives led him to a fascinating conclusion: that the costs to build a decent rocket should be a lot less than they were. Materials science had evolved a lot over the years, but NASA and rocket makers were not trying to take advantage of that to lower costs. SpaceX could deliver rockets at 1/10th the cost!
Basically, making your own parts let's you make them cheaper, much faster, AND gives you the ability to innovate on them, which is very hard if others are making them. I am not sure if Elon knew this going in or just drove in this direction because it was most cost effective, but it was very interesting to learn about. And the result has been impressive, after many years of crazy hard sounding ups and downs, it got profitable:
If everyone in the world read this book, the world would instantly become a better place. Mental models, while never perfect, are very powerful tools,If everyone in the world read this book, the world would instantly become a better place. Mental models, while never perfect, are very powerful tools, and Grant has come up with a compelling, research backed view of what makes some people successful, and others less so.
Grant divided the world into givers, matchers, and takers. Through a lot of research, Grant determined that the most successful and the least successful people are often givers, that takers often do well but not over the long term, and the vast majority of people are matchers. Like all such categorizations (eg fixed vs growth mindset), it isn’t perfect, which bothered me a little - until you realize that in different situations you can either be giving, taking, or matching, and there are probably people that favor one of those three more often than not.
Grant used surveys to determine if people are givers, though its strange that he didn’t expand on what type of questions are used to determine this, as it would have been insightful. Happily, Google works, and I found he does have such a test on his website. And I scored 53% giver!
The book opens with a chapter about one of the best givers and people that I know, David Hornik, who funded the last company I worked at. So awesome to see him getting such an amazing shoutout - he deserves it!
I liked the example of Ken Lay as a successful taker. “When kissing up, takers are often good fakers.” I do wonder how many successful “takers” there are out there that don’t have anything bad happen to them though. The book does use Frank Lloyd Wright as such an example, which is a fascinating dichotomy.
Other interesting ways to determine givers & takers: use of “I” vs “we”, number of LinkedIn recommendations written vs received.
This was a very powerful insight: “people actually make more accurate and creative decisions when they’re choosing on behalf of others than themselves.”. Eg: “The solution was thinking about myself as an agent, an advocate for my family. As a giver, I feel guilty about pushing too much, but the minute I start thinking, ‘I’m hurting my family, who’s depending on me for this,’ I don’t feel guilty about pushing for that side.”
The book also explains why givers are also the most unsuccessful - they are too selfless. Successful givers balance giving to others while taking care of themselves. “As Bill Gates argued at the World Economic Forum, “there are two great forces of human nature: self-interest, and caring for others,” and people are most successful when they are driven by a “hybrid engine” of the two. If takers are selfish and failed givers are selfless, successful givers are otherish: they care about benefiting others, but they also have ambitious goals for advancing their own interests.”
I liked the example of how with Freecycle, small numbers of givers could turn everyone into givers. I think Goodreads has had a similar journey with our community. It’s kind of the definition of a community: “If a group develops a norm of giving, members will uphold the norm and give, even if they’re more inclined to be takers or matchers elsewhere. This reduces the risks of giving: when everyone contributes, the pie is larger, and givers are no longer stuck contributing far more than they get.”
Some other quotes I liked:
“highly talented people tend to make others jealous, placing themselves at risk of being disliked, resented, ostracized, and undermined. But if these talented people are also givers, they no longer have a target on their backs.”
“For many years, psychologists believed that in any domain, success depended on talent first and motivation second. To groom world-class athletes and musicians, experts looked for people with the right raw abilities, and then sought to motivate them. If you want to find people who can dunk like Michael Jordan or play piano like Beethoven, it’s only natural to start by screening candidates for leaping ability and an ear for music. But in recent years, psychologists have come to believe that this approach may be backward. In the 1960s, a pioneering psychologist named Raymond Cattell developed an investment theory of intelligence. He proposed that interest is what drives people to invest their time and energy in developing particular skills and bases of knowledge. Today, we have compelling evidence that interest precedes the development of talent. It turns out that motivation is the reason that people develop talent in the first place.”...more
I kind of loved this book because it give a lot of the "why" - the science - behind a lot of best practices. This is the kind of thing that helps me cI kind of loved this book because it give a lot of the "why" - the science - behind a lot of best practices. This is the kind of thing that helps me change my behavior - when I know how it works under the hood.
The book is broken into a series of "brain rules" on different subjects. I'll list main takeaways:
Exercise We all know it's good for us and it feels good and we should do it. The best quote here was "Physical activity is cognitive candy." - also "A lifetime of exercise results in a sometimes astonishing elevation in cognitive performance, compared with those who are sedentary." The basic science is that blood flow through your brain is good for it and increases brain activity. Tip: exercise before you need your brain to be at its best.
Sleep First, great to have validation that there really are early birds and night owls. I'm definitely a night owl, despite my kids best efforts. The interesting implications of this for a company are that people are at their best - their most productive - at different times of the day - so building a culture that is flexible and let's people work their hours is key. The science about the history of naps and the fact that the mid-afternoon slump is a real thing was also very interesting. The studies about sleep loss being as cognitively limiting as alcohol were also illuminating. Another study showed sleeping on a problem really does work.
But the most interesting thing about the sleep chapter was the section on dreaming and what it might mean. In particular, dreams may at least in large part be a method of neural network training to enforce learning. "humans appear to replay certain learning experiences at night, during the slow-wave phase."
Stress Too much stress is bad for you - our systems weren't designed for constant stress. If you have too much adreline in your system constantly it leads to scarred blood vessels and then eventually a stroke. But a little stress is good - our brains will remember things that we are stressed about better (eg avoid predators on the savannah). But too much (chronic) stress can overwhelms the brain and hurts learning and can even make you depressed. Chronic stress is often the culprit in grief, or high anxiety households. The worst kind of stress is the feeling that you have no control over the problem— you are helpless.
Wiring “What you do and learn in life physically changes what your brain looks like— it literally rewires it.”
Attention I’ve said for a long time that humans don’t remember facts, we remember facts couched in emotions. We can easily recall all the strong emotional moments of our lives as if they happened yesterday. Now it’s great to have the science behind this: emotions release dopamine, which greatly aids in memory and information processing. This means that people will relate better to products that bring up positive emotions for them. It also means that an emotional hook to lead into an idea or product will always work as it triggers the emotion in the person.
Another interesting thing mentioned in this chapter is the 10 minute rule. We only have about 10 minutes of attention on something before we start to tune out. As the book says, “This fact suggests a teaching and business imperative: Find a way to get and hold somebody’s attention for 10 minutes, then do it again.”
To get an idea to stick you have to give people the mental model for it first - “meaning before details”. Specifically, you need to: “Give the general idea first, before diving into details, and you will see a 40 percent improvement in understanding.” And then you also have to simplify and hammer home concepts and let people digest them - force-feeding too many concepts at once won’t sink in.
In terms of paying attention (vs automatic things like riding a bicycle), “Multitasking, when it comes to paying attention, is a myth.” - the brain can only pay attention to one thing at a time.
Memory There are different types of memory: declarative (I can remember my address and SSN), non declarative (I can remember how to ride a bike), short term, and long term. Short term memory isn’t converted to long term easily: “People usually forget 90 percent of what they learn in a class within 30 days. And the majority of this forgetting occurs within the first few hours after class.”. Keys to doing so are coding in emotion (why word association works), and repetition (“repeat to remember”). Also, thinking about what tree the person will mentally group the information and how to increase entry points or create strong ones.
Interestingly, “Memory worked best, it appeared, if the environmental conditions at retrieval mimicked the environmental conditions at encoding.”. This means if you learn something sad you will remember it better if you get sad again. Fascinating. This makes sense, as our brains must group similar patterns it remembers together. To get practical, you can create science, art, language stations to help people remember better.
We all know this to be true - our memory isn’t perfect. This is because we remember patterns, not facts or single instances. “Our brains give us only an approximate view of reality, because they mix new knowledge with past memories and store them together as one.”
Another tidbit I liked, that fits in the “repeat to remember” bucket: “A great deal of research shows that thinking or talking about an event immediately after it has occurred enhances memory for that event”. Basically the more an idea can be repeated - especially in timed intervals - the more chance it has of being encoded from short term to long term memory.
Sensory Integration We remember data from each of our senses, and we learn best if we stimulate multiple senses concurrently. You remember better if you see AND hear something, or even if given words and pictures. Smells or sounds or tastes can trigger additional associations or emotions and help us create positive or negative associations to things we see or do. This is why people who haven’t adopted digital reading say things like “I love the smell of a good book”, this is why smelling fresh roasted coffee is a key part of Starbucks playbook. Smells have the power to bring back memories that are associated with them.
Vision Vision trumps and overrides all other senses. I loved the story about the wine experts who were fooled by white wine with red dye in it because their eyes said it was red wine. Fascinating to read about the science of how the brain takes in the signals from the eyes, combines both signals, and applies pattern matching to fill in details. This means the brain has creative freedom to insert whatever it wants into our vision.
Practical applications: our vision is caught by bold colors, orientations, motion. We remember images better than words because it’s easier to pattern match the image, so use images in presentations.
Music Music makes us more empathic - we can better recognize the emotions in speech, which helps in social abilities. Making music is 10x better for kids than listening to baby einstein CD’s. Listening to music reduced cortisol and stress.
Gender Boys and girls have different brain structures. When under stress, men remember the gist of things better, and women remember details and emotions. These quotes describe it well:
“The difference between girls’ and boys’ communication could be described as the addition of a single powerful word. Boys might say, “Do this.” Girls would say, “Let’s do this.”
“When girl best friends communicate with each other, they lean in, maintain eye contact, and do a lot of talking. They use their sophisticated verbal talents to cement their relationships. Boys never do this. They rarely face each other directly, preferring either parallel or oblique angles. They make little eye contact, their gaze always casting about the room. They do not use verbal information to cement their relationships. Instead, commotion seems to be the central currency of a little boy’s social economy. Doing things physically together is the glue that cements their relationships.”
“In our evolutionary history, having a team that could understand both the gist and details of a given stressful situation helped us conquer the world. Why would the world of business be exempted from that advantage? Having an executive team or work group capable of simultaneously understanding both the emotional forests and the trees of a stressful project, such as a merger, might be a marriage made in business heaven. It could even affect the bottom line.”
Exploration We learn by doing, by exploring the world. We take pleasure in that exploration. Discovery based learning is best. Medical school offers the best on the job learning - other types of education should do better to model it. Learn and be curious....more
I think this is a must read for any leader in a modern business. Google has done a lot of things right both in their products and also in how they runI think this is a must read for any leader in a modern business. Google has done a lot of things right both in their products and also in how they run their company and build their culture, and this is a fairly detailed account of how they've built an impressive culture, and is written by someone who knows - their head of HR. I'm a little surprised he told as much as he did - but I suppose it will only help for recruiting.
Goodreads is now a subsidiary of Amazon, and I have spent significant time learning to integrate the best of Amazons culture with ours. And I'm happy to say that many - perhaps most - of the best practices listed in the book are also used by Amazon. Things like hiring people smarter than you, hiring committees and having objective people on them, committees to approve promotions, focusing on the two tails, and more. These don't seem to be things all companies do yet - but should.
So while much of the practices were things I'm already doing or aware of - there was a lot I learned from the book too. Here are some of the bigger takeaways I had.
One of the more interesting ones was the notion to separate performance reviews from compensation discussions. This makes a lot of sense, is something we have already been making progress towards, and is something I'm going to think about more.
“Traditional performance management systems make a big mistake. They combine two things that should be completely separate: performance evaluation and people development. Evaluation is necessary to distribute finite resources, like salary increases or bonus dollars. Development is just as necessary so people grow and improve." If you want people to grow, don’t have those two conversations at the same time. Make development a constant back-and-forth between you and your team members, rather than a year-end surprise."
Another one was giving managers a bi-annual scorecards from their directs on how they did on ~10 dimensions that Google has determined are the determinants of a great manager. And no surprise (but very important to keep in mind), the book found that "manager quality was the single best predictor of whether employees would stay or leave, supporting the adage that people don’t quit companies, they quit bad managers." While we do a lot of surveys, we haven't packaged up the managers feedback into a report like this, and I think that would be powerful.
Laszlo was impressive in citing lots of research to prove his points. It was one of my more favorite things about the book - he is clearly a student of human development. This led to lots of tidbits that apply pretty broadly, and which are great things to keep in mind when building a business.
The chapter on nudges was I think my favorite in the book. Pretty cool the depth to which they have taken these - reminds me a lot of the onboarding funnel analysis I've done for Goodreads - paying attention to where you can message timely, relevant, easily actionable messages that will result in people taking desired actions, and a/b testing the results. Pretty impressive they a/b test that kind of stuff at Google! Examples given were around lists on how to onboard someone as a manager, how to be onboarded as a newbie, how to get more people to save money earlier in life and enroll in the 401K program (his data here was impressive - on how people of the same income bracket vary widely on wealth accumulated in their lives based purely on how much they save when they are young), and how to get people to eat healthier by putting the healthier foods in the kitchens more prominently.
"Nudges are an incredibly powerful mechanism for improving teams and organizations. They are also ideally suited to experimentation, so can be tested on smaller populations to fine-tune their results."
Laszlo did a great job of explaining a lot of the psychology behind nudges too. My favorite was the research about checklists, and story about how the Airforce found that even the smartest, best trained pilots can make mistakes, but having checklists reduces their error rates significantly.
"I realized that management too is phenomenally complex. It’s a lot to ask of any leader to be a product visionary or a financial genius or a marketing wizard as well as an inspiring manager. But if we could reduce good management to a checklist, we wouldn’t need to invest millions of dollars in training, or try to convince people why one style of leadership is better than another. We wouldn’t have to change who they were. We could just change how they behave."
"It turns out checklists really do work, even when the list is almost patronizingly simple. We’re human, and we sometimes forget the most basic things."
Another thing I loved was the focus on identifying the people who are best at a specific skill, and designing a program for them to teach that skill to others. G2G (Googlers 2 Googlers).
"Giving employees the opportunity to teach gives them purpose. Even if they don’t find meaning in their regular jobs, passing on knowledge is both inspiring and inspirational."
I liked his descriptions of deliberate learning. He gave examples of asking after every meeting "what did we learn and how could we do better in the future". And the story about Tiger hitting golf balls at 4am in the rain was pretty sweet.
"Ericsson refers to this as deliberate practice: intentional repetitions of similar, small tasks with immediate feedback, correction, and experimentation."
My favorite tidbit - which I know to be true but is something great to keep in mind - is how to motivate people: let them connect to the people their work is helping.
"even a small connection to the people who benefit from your work not only improves productivity, it also makes people happier. And everyone wants their work to have purpose.
Bock, Laszlo (2015-04-07). Work Rules!: Insights from Inside Google That Will Transform How You Live and Lead (pp. 340-341). Grand Central Publishing. Kindle Edition. ...more
Loading...
