Notes for August 11th 2023
RIP Bram Moolenaar
I'm not sure why, but I wind up going pretty weirdly deep on economics waffle here. Sorry if that's not interesting to you!
- We had a long weekend in Ireland this week, so on this 4 day workweek I crammed as much as humanly possible into the window of time I had. Mostly as a result of needing to prep for some big events that I'm hosting.
- With a 3-day weekend, we also began the process of potty training our 3 year old. This is mostly because he feels ready. But also because he's going to a new crèche/childcare scenario in September, so they need him to be potty-ready. It's actually gone fairly easily without much horror introduced. I've heard awful stuff. But Nathan's had a few accidents, and enough success to not be intimidated by the process.
- I had a French Press explode on me this weekend, which was not ideal. Hot water + explosive glass firing at your skin is not something that was on the bingo card. But here I am, with a left arm that looks as though it was dipped into Mount Olympus.
- Everyone is waiting for the recession. But looking at a macro environment, unemeployment is super low (historically so in some economies, like Ireland), inflation is cooling down and earnings calls last week kept using the phrase "soft landing." It's not quite a soft landing as much as a bottoming-out right now. We can't manufacture a V-shaped recovery if there's no crash (a-la 2008), so instead we've sat at the bottom end of a lumpy U for a long time. Like a W but if a toddler drew it. So I'm pretty optimistic about things as we get through Q3 and head into Q4. Mostly because retail is strong and getting stronger when brands figure out online sales and direct-to-consumer. Watch this continue to be the post-covid story.
- Another musing on the economic situation is that companies have two options to climb out of the slump. And in the tech world, they have to resolve to chasing profitability, margin positivity and growth driven with an EBITDA backbone. With that backbone, looking at 2024, the options are: 1) save $5 on weak productivity by removing dead weight from your OpEx (namely headcount) or 2) add $1 by increasing margin with new products or tech work-arounds (e.g. reducing AWS spend). Number 2 is more prudent long-term, but number 1 is being rewarded handsomely by the markets, even though it's tough for a company to stack-rank good employees from bad ones in many instances. Some companies are going to lose top talent, which will cause a negative medium-long term impact, despite the immediate applause by the markets. Case-in-point is Twitter/X, which is reducing headcount to be below 1,000 people. It's being rewarded by the market despite the fact that it's lost 80% of advertising revenue. Long-term, that thing is dead.
- In reality both need to happen. Not huge swathes of layoffs, as I've seen the impact of a 10% shave on headcount being both positive (forcing change and focus) but also leaving a lasting taste in the employees mouths (any mild reorg means people get cagey about layoffs and fix their LinkedIn profiles). But taking your bottom performers or dead weight roles out is healthy for overall culture and productivity. Taking top performers who aren't productive is the companies fault, orientate those people somewhere that they can have impact before they quit.
- For what it's worth, the "dead weight" roles tend to circulate around things like internal brand managers (people who print swag, organise parties, etc.). Give those as volunteer hustles to employees who want them and outsource the hard bits that cost money. That's an opportunity for big agencies like Deloitte and WPP, and keeps internal tech employees focused on the mission. I say this as someone who's worn those hats several times over the last decade and a half. I still love that work, feel it benefits me and the folks around me, but absolutely would never pivot away from technical, strategic sales alignment.
- In a similar vein to the above, I also wonder if Ireland needs a better economic opportunity provided to smart tech workers. I work a bit with startups. Both formally through work and informally through volunteer stuff because I'm interested in the spaces these smart folks live in. And I think it's basically impossible for someone who's had lots of success in tech, pharma or similar industries in Ireland to pivot off and start something new. The risk incurred is so enormous that it's just not worth missing a single mortgage payment or the kids' fees for school/crèche. I'd love to see a fund some in where the government backs the risky move so individuals feel comfy taking the risk, while VCs/banks/capital funds fund the innovation.
- I'm speaking for myself in 10 years time. I'd love to start something, taking lessons learned over many years. I would love to partner with a technical founder type who's got a big idea but no experience executing or growing a business. Or even a small, but established Series-B/C company that I can add value to. But to do that, I feel like I need my mortgage gone. Hence the need for a second once-in-a-lifetime IPO motion!
- If you imagine the innovation of tech companies, it's not technology based (in fact, that's rarely true for the big tech companies; they rely on tech innovations from open source or publicly funded research), it's time-based. Netflix saves you time from not having to watch ads. Amazon saves you time from not having to go to shops or wait for deliveries. If you want to disrupt an industry, think of one that consumes too much time.
- For what it's worth, I think transport is the answer.
- Capital gains need to go in Ireland. I'm riffing on the above to some extent, but people in really good roles in this country earn a decent amount, or have the ability to earn a decent amount, from stock options issued through ESPP schemes. Which in Ireland incurs income tax as well as capital gains. Which means the people doing well can't do super well. Now, we don't want an American style 1% class of people who live in ivory towers (we leave that to our politicians). But we do want to unlock some economic success that isn't specifically tied to housing or property, which is an asset class that should be deeply normalised and run into the ground as much as possible. Imagine someone opting into ESPP schemes over the course of 4 to 6 years in a tech company. They earn good money, which unlocks strong buying power and the comfort to buy a home and have kids. All really important to the economy. But if they then had extra money, they could invest in startups, non-profits or their own side hustles. That doesn't happen in Ireland today, despite the immense talent in the economy. We're stifling the ability for folks here to unlock passions they have to turn those passions into more economic value.
- One of the biggest risk-takers I know opened a coffee shop 10mins away from me. I love the shop. It's a bit rag-tag, has luxury food items on the shelves and found-furniture around it. It's got a great vibe and the owner is super friendly, thus attracting super outgoing employees. He's a coffee nerd that doesn't live in the area. But hey presto, he found a cheap spot to open his passion up with a bank loan. A few years later, he's thriving and a pillar of a community that didn't realise it needed it. Imagine how much quicker or bigger he could have gone if he had a private investment from someone who earned money from ESPPs or RSUs rather than the red tape and nightmare fuel banks provide to any economic value they pretend to add.
- I mentioned that I've acquired a "Whoop" fitness tracking thing. It arrives this week so I won't have a proper sense of how useful it is just yet. But I was thinking that trackers, including Apple Watch, are a good indicator of public need and want to be healthier. Flip that another way, and medication and healthcare tends to be disease-first reactionary stuff. We need to turn the tide and have healthcare be long-term health-first proactive stuff. As a man, I basically never go to the doctor, especially if I feel very little is wrong. That's wrong for someone who'll turn 40 in the next few years. I should be far more proactive with my doctor, and get myself a nutritionalist, instructor, etc. Not to be ripped and an athlete, but just to ensure I last as long as possible for my kids.
- I've been doing a pile of work around culture & people lately. Like, a lot. One of my goals for the year is to impact our local site culture (approx 450 people) in a positive way. It's been lacklustre as a result of covid, people being hired into a "remote-first" modality and just... a bit of a saggy approach to culture in general. The actual workload is manageable but quite high. And the output tends to be projects, people liaising and sort-of influencing without managing. And it's lead me to wonder if I'd be good at being a "Chief of Staff" kind of role. Managing upwards and downwards, in a way. I doubt $current_employer wants me to do that as currently my role involves touching revenue and that's fairly important. But I wonder if it's something I could pursue down the line. Ideally in $current_employer.
- I made some pizza this week on my Ooni pizza oven. And my word, I'm not sure how, but it turned out the best so far. The dough is the tough part (not the cooking bit!) and it wound up phenomenal.
- Some new tracks from the upcoming Chemical Brother's album were released and my word, they are bangers. Since Body&Soul festival earlier this summer, I've been very much so in a bit of an electronic vibe.
- Reading the headlines on one of the long-running "Apple-only" blog sites, there was a headline that made me laugh. It was appalled that a $130k new EV launched in the US only would dare ship without Apple CarPlay (or, less importantly, Android Auto). I find it so funny that these micro-blog types 1) get such weird attention from Apple fanbois & 2) have a sustained audience. I adored Gruber and co. in the early days. But I grew up, saw a bit of a grift and stopped believing the absolute wild amount of hype, hyperbole and reality distortion around them.
- The "return to office" narrative is one I've spoken about here. Because I've spent almost a decade working in a hybrid capacity (long before viral infections forced the issue) and am a huge advocate for getting in the room and being with people to be productive, learn and develop skills. $current_job has me as the face of an RTO motion that begins in earnest in 3 weeks. And I've had almost entirely positive vibes from it. That could be me, it could be the appetite of my colleagues. Or it could all be smoke & mirrors.