Books that make you dumb :)

Virgil Griffith analyzed the top 10 books listed on Facebook by students in a college versus the average SAT scores for the school and the results are hilarious!

The students in the schools with average SAT scores of 800-950 loved The Holy Bible and erotic titles like Zane. Students in the schools with average SAT scores above 1250 loved 100 Years of Solitude, Lolita, Crime and Punishment and Freakonomics.

Funny how the SAT scores of those who refer to the Bible as “The Holy Bible” is 150 points lower than those who refer to it as “The Bible” 🙂

Read the full article at:
http://booksthatmakeyoudumb.virgil.gr/index.php

The Logitech Quickcam Pro 9000 and Orbit AF are great webcams

We were evaluating webcams for doing video conferences over Skype between the OLX New York & Argentina offices and selected those two.

They are 2 Megapixel, they work well in varying lighting conditions, the quality is great and they both cost around $100.

Buy the Pro 9000 if you have a screen or TV to place it on top of. Buy the Orbit AF if you are placing it on a desk and/or want the motorized tracking feature.

Rogue French trader Jerome Kerviel was forced to work 30 hours a week!

Friends of rogue trader Jerome Kerviel last night blamed his $7 billion losses on unbearable levels of stress brought on by a punishing 30 hour week.

Kerviel was known to start work as early as nine in the morning and still be at his desk at five or even five-thirty, often with just an hour and a half for lunch.

One colleague said: “He was, how you say, une workaholique. I have a family and a mistress so I would leave the office at around 2pm at the latest, if I wasn’t on strike.

“But Jerome was tied to that desk. One day I came back to the office at 3pm because I had forgotten my beret, and there he was, fast asleep on the photocopier.

“At first I assumed he had been out until dawn the night before, but then I remembered he’d been working for almost six hours.”

As the losses mounted, Kerviel tried to conceal his bad trades by covering them with an intense red wine sauce, later switching to delicate pastry horns.

At one point he managed to dispose of dozens of transactions by hiding them inside vol-au-vent cases and staging a fake reception.

The Dlink DGL 4500 and 4300 are the best gaming routers on the market

I was having difficulty connecting to games both on the Xbox 360 and with my PC, but ever since I switched to the DGL 4500 and 4300, it’s been working extremely well.

I bought them at CircuitCity.com – respectively for $179 and $114.

Note that I had to upgrade the firmware on the DGL 4500 from 1.00 to 1.02 to solve an intermittent router reboot problem, so if you are not technically inclined, don’t need 802.11n or a very long range, you are probably better off with the 4300.

Great Gaming PC

I just bought a Dell XPS 420 with a 512Mb Nvidia GeForce 8800 GT, a 3.0 Ghz Core 2 Duo and 3Gb of DDR2 SDRAM at 800Mhz for $1,249 and it’s a phenomenal machine for the price. I hooked it up to my Dell 24” widescreen monitor and Company of Heroes runs flawlessly in 1920*1200 in full high resolution mode.

Highly recommended for price sensitive gamers everywhere!

Go Masha!

I have always been a huge fan of Maria Sharapova – not only because she is drop dead gorgeous, but also because she is so passionate, intense and determined.

She played phenomenally well this Australian Open and served extremely well – defeating Henin, Ivanovic, Jankovic and Davenport along the way. She deserved to win! If she can stay healthy and learn to mix up her game a bit, she could win many more grand slams.

Go Masha!

PS Whenever you have a few minutes to go on a date, let me know 🙂

An optimist’s perspective: the party system in the US works!

I had the pleasure of attending yet another one of Mark Gerson’s phenomenal Shabbos dinners two weeks ago and the guest speaker made a very interesting point.

He argued that while it is easy to be cynical and disappointed by the current political process and environment, the reason we see such diversity and conflict within the two parties right now and the reason that the fights have become bitter and personal between the two parties is that they are no longer about the issues.

He argued that the two party system works. If you asked a Democrat in the early 1970s what their top three issues were, they would have answered:

  • Entrench the civil rights movement
  • Women in the workplace
  • Environmental protection

Much progress remains to be done in all three areas, but no one questions their merit.

Likewise, if you had asked a Republican what he wanted for the US, he would have said:

  • Win the cold war
  • Reform welfare
  • Lower marginal tax rates

Again, those things have happened and are not questioned anymore. The issues of both parties have been largely successfully addressed and accepted – far beyond the wildest imagination of the most optimistic person in the early 1970s.

Because of that success, the parties no longer stand for something clear and you can see the battles being fought within them right now to find the issues that they will define them for the coming decade. The Republicans especially are searching for their identity as the somewhat un-natural alliance between the Christian conservatives and the socially liberal/fiscally conservative libertarian types is fraying.

For all its flaws the nomination and election process is actually letting us understand better what the candidates and parties stand for or hope to stand for.

This is going to be interesting to watch in the years to come!

Outsourcing Development

A few of you have asked me whether they should outsource their development with questions usually covering code quality, costs and security.

The security risks – especially the risk of the development shop stealing your code to compete with you or selling your code to your competitors are the lowest one. Their job is not to be an operating company – they would not know how to compete with you – and they would not get much business if they were re-selling the code they wrote for you to your competitors. However, as with many such decisions, “caveat emptor” – do your due diligence: talk to several clients they have worked with in the recent past – both large and small – sign an NDA, a non compete agreement and make sure your agreement with them states you own 100% of the intellectual property they develop for you.

The more relevant issue in my perspective is one of management. Outsourcing your development will NOT save you from needing a great CTO and/or VP of Product. You will need to have very well defined specs for the development to meet your expectations. You will also find them to be much more responsive and effective if you are speaking with them daily and verifying their work daily. This constant need for communication means that where you outsource to is highly important. If there is a 13 hour time difference communication is extremely difficult because there is never a good time to talk.

My personal experience has been mixed. With Zingy, we tried outsourcing our Brew development to a development shop in Russia. The problem was that the code they wrote worked on the emulators, but not on the phones which always had quirks of their own. The Brew emulators might be more accurate today, but at that time outsourcing ended up being ineffective as we essentially had to rewrite everything for the phones with our New York developers. We also tried outsourcing other elements of our development, but the development company took on more than it could handle with us and was always late and we stopped using them. Make sure that whichever company you hire can handle your needs – that they are not overwhelmed by a large client and will pay attention to you, that the work you have for them is in line with their expertise and that your project will be adequately staffed.

With OLX, we off-shored the development, but it’s all in-house. We are incorporated in Argentina and all the developers are full time employees of OLX. It works well because Argentina is between 1 and 3 hours ahead of New York which makes communication easier. The New York team also spends 2 weeks every 2-3 months in Buenos Aires with the team. Most importantly, it works because I have a phenomenal Co-CEO and partner who manages the team in Argentina. We could not have 66 employees in Argentina without Alec’s (www.alecoxenford.com) expertise and experience.

Some of my other portfolio companies have successfully outsourced development. I can personally highly recommend working with DigBang (www.digbang.com) in Argentina. I am happy to introduce any of you to them if you are interested.

Cloverfield is highly entertaining!

The movie is very well done. It lulls you into a false sense of security in the first few minutes of the movie as it covers the life of the protagonists to the point you almost forget you are in a monster movie. However, once the action starts, it is relentless.

My only complaint is that they move the camera way too much – I was starting to get motion sickness at a few points! Note to directors: We get that it’s a handheld camera, no need to shake the camera that much – all modern cameras have good image stabilization and people are getting used to shooting with them. Even my friend’s home movies don’t shake that much when they are running around!

Overall, I really liked the “Blair Witch meets Godzilla” feel. It actually feels real – all the more so as they don’t “manufacture” an unrealistic ending as they do in “I am Legend”.

Go see it!

Non sequitur: Beth (Odette Yustman) is really hot and I love her apartment!

My article in Challenges on the American entrepreneurial spirit

Challenges is a French business magazine similar to Forbes and Fortune in the US. They just had a special issue on the US and the American Dream and asked me to write an article on the American entrepreneurial spirit.

Here are the cover of the magazine and article:

You can read the article as it is published at:
http://www.challenges.fr/business/20080110.CHAP1023002/aun_chec_devient_une_forcea.html

I was limited to 1,600 characters so it feels a bit rushed. Here is the full article:

Après le Bac, j’ai décidé de poursuivre mes études aux Etats-Unis. J’ai adoré cette expérience. Choisir ses cours et pouvoir s’adonner à ses passions pour le seul plaisir intellectuel était pour moi libérateur. Il y a plus de Prix Nobel sur le campus de Princeton que dans la France entière – et nous interagissions directement avec eux !

J’ai alors observé, pour la première fois, l’esprit d’entreprise américain. Il est inculqué dès le plus jeune âge et tous les adolescents font du volontariat ou travaillent pour entrer à l’université. Plus tard, presque tous les étudiants travaillent en complément de leurs études et durant toutes les « vacances » d’été.

Comme la plupart des Américains, j’ai rejoint le marché du travail à 22 ans en sortant de Princeton. Mes deux années chez McKinsey en tant que consultant ont été formidables – une opportunité quasi-impossible en France pour un jeune tout juste diplômé.

En 1998, je me suis rendu compte que ma vocation n’était pas de créer la présentation PowerPoint parfaite. Ma chance étant d’être au bon endroit, au bon moment, avec les bonnes compétences, j’ai décidé de me lancer sur Internet. N’étant pas créatif par nature et n’ayant pas de « bonnes idées », j’ai décidé de faire de « l’arbitrage international d’idées » et de copier un modèle américain pour l’amener en Europe. Par hasard, je suis tombé sur eBay et j’ai adoré le modèle. Aucland était né !

Pour un temps tout s’est bien passé. La compagnie grandissait et l’engouement lié à la fameuse « bulle » Internet nous faisait tous rêver. Il semblait de nouveau possible de réussir en France même en étant très jeune ! Malheureusement, la dite bulle a fini par éclater et… nos rêves avec elle. Ce n’est qu’en retournant aux Etats-Unis pour créer Zingy que je me suis vraiment rendu compte de la différence de mentalités. En France, que d’heures perdues face au « système » : monopole des commissaires priseurs, fisc, 35 heures, rigidité du travail…

Aux Etats-Unis, en 2001, je repartais donc de zéro. Pour les Américains, le revers que j’avais connu avec Aucland n’était qu’une cicatrice de guerre et l’expérience tirée une force pour l’avenir. En France, un échec est souvent fatal. En fin de compte Zingy aura été le succès que j’aurais voulu qu’Aucland fût. Après des débuts très difficiles et des grosses frayeurs – bien qu’ayant investi tout ce que j’avais, j’ai manqué de payer les salariés pendant plusieurs mois – les ventes décollaient et l’affaire devint un succès. Quel plaisir de passer mon temps à étendre la boite sans inconvénients bureaucratiques encouragé par tous ! Ici les succès comme les échecs sont portés avec fierté !

Ayant goûté aux joies de l’entreprenariat, me voila reparti aujourd’hui dans une nouvelle aventure, avec OLX. Nous voulons créer le plus grand site de petites annonces gratuites au monde. Le projet est risqué, mais si j’ai une appris une chose, c’est qu’il faut poursuivre ses rêves.

Quant à la France, c’est un pays que j’adore. Le savoir vivre, la qualité de vie et bien entendu notre Culture et notre Histoire sont incomparables. Pourtant, malgré tout son attrait, c’est aujourd’hui le pays où je viens en vacances, non celui où je peux réussir : s’il y a bien un défi que la France doit relever de toute urgence, c’est de prouver le contraire !

The secret to raising smart kids (and overcoming challenges)

I just came across a fascinating article in Scientific American on how one’s attitude towards intelligence dramatically impacts your performance in school and life. If you believe you have a set level of intelligence, you will shy away from tough problems and react negatively to failure. If you believe you can build your intelligence by working at it, you will look forward to solving difficult problems and setbacks will only be learning experiences.

As such parents should always reward their kids for their success by praising their hard work rather than intelligence. That seemingly small difference in the way kids are rewarded had a huge impact in the way they approached life!

Read the article at:
http://www.sciam.com/article.cfm?id=the-secret-to-raising-smart-kids&print=true

The power of regression analysis by Malcolm Gladwell

As Malcolm Gladwell expressed in a New Yorker article, when it comes to art, most people fall in the Hume camp of reasoning, but a defiant minority always falls in the Kames camp:

“Something has long been argued about art: there is no way of getting beyond one’s own impressions to arrive at some larger, objective truth. There are no rules to art, only the infinite variety of subjective experience. “Beauty is no quality in things themselves,” the eighteenth-century Scottish philosopher David Hume wrote. “It exists merely in the mind which contemplates them; and each mind perceives a different beauty.” Hume might as well have said that nobody knows anything.

But Hume had a Scottish counterpart, Lord Kames, and Lord Kames was equally convinced that traits like beauty, sublimity, and grandeur were indeed reducible to a rational system of rules and precepts. … He genuinely thought that the superiority of Virgil’s hexameters to Horace’s could be demonstrated with Euclidean precision, and for every Hume, it seems, there has always been a Kames—someone arguing that if nobody knows anything it is only because nobody’s looking hard enough.”

I first came across a follower of Kames while studying econometrics at Princeton. My professor, Orley Ashenfelter, wrote a model to predict the quality of wines in Bordeaux based on the temperature and precipitation that year. His model could predict the quality of the wine before it was even on sale and had been tasted by experts like Robert Parker. Needless to say the wine community was outraged. The typical reaction was “How can you reduce our noble art to mere equations? How can you claim to know the quality of the wine without tasting it?” The critics were pointing out “flaws” such as “the model only predicted the exact quality of the wine in one specific year” failing to understand that econometrics is about confidence intervals. The model and the experts only disagreed on one year, 1964, where the experts suggested the wine was not very good, while the model suggested otherwise. Needles to say Professor Ashenfelter’s cellar is full of wine from 1964 🙂

Gladwell’s article covers the travails of a few brave souls as they try to predict hit songs and hit movies. He first describes how a small New York based startup called Platinum Blue analyzed the mathematical relationships among a song’s structural components. The applied their model to thousands of songs and noticed that all the hits came out of a predictable and highly conserved set of mathematical patterns. As McCready, the firm’s founder explains this does not mean that all songs that conform to the pattern will be hits, they still have to “sound right”, but almost certainly songs that fall out of that pattern will not be hits. Interestingly enough, when they first ran their analysis, Platinum Blue was really excited about by the Norah Jones record “Come Away with Me”. It went on to sell twenty million copies and win eight Grammy awards.

Gladwell then describes the story of Dick Copaken, a lawyer and cinephile, who created a company called Epagogix that analyzes screenplay elements predict US box office receipts. Predictably, the industry reception was terrible at first: how could outsiders claim they knew more than the insiders? But after a number of successful tests Epagogix is now working with major studios.

It seems that art is more structured than we thought after all – not that we necessarily want all songs and movies to be blockbusters…

Read the full article at:
http://www.newyorker.com/archive/2006/10/16/061016fa_fact6?currentPage=1

If you are in New York, go see Rock ‘n’ Roll

I have always been a huge fan of Tom Stoppard’s plays and movies especially Arcadia, Shakespeare in Love and Empire of the Sun. I just saw Rock ‘n’ Roll, a play about communism, the 1968 uprising in Czechoslovakia and rock and roll as a symbol of freedom. It’s not as good as Arcadia, but I truly loved the dialogue, the characters and their evolution.

You literally see the intellectual level of the discussion go down as we progress through time from 1968 to 1990 and the characters age, lose their British accent and society seemingly dumbs down (“What? They give hints in A levels now?”). In contrast, some of the early discussions on communism, materialism, objectivism and the poetry of Sappho were mind boggling and I was enthralled listening to them!

Criminal Profiling is bogus by Malcolm Gladwell

I have always been a huge fan of Malcolm Gladwell’s New Yorker articles. He is the quintessential eclectic modern day intellectual. His recent article on criminal profiling is a case in point. He uses engaging anecdotes to count the history of criminal profiling, leaving little doubt by the end of the story that the process is fraught with error and misleading.

Read the article at:
http://www.newyorker.com/reporting/2007/11/12/071112fa_fact_gladwell

Shocking research on continental European economics teaching

A recent article in the Financial Times showed that French and German schoolbooks demonize enterprise. As the article put it:

“Students learn that companies destroy jobs, while government policy creates them. Globalization is destructive, if not catastrophic. Business is a zero-sum game. If this is the belief system within which most students develop intellectually, is it any wonder French and German reformers are so easily shouted down?”

You can read the full article at:
http://www.ft.com/cms/s/0/3f03314e-bd3e-11dc-b7e6-0000779fd2ac.html

World Without End is fascinating

When I first read The Pillars of the Earth 15 years ago, I absolutely fell in love with it. I would have never imagined that the building of a cathedral in 12th century England could be fascinating, but the rich cast of characters totally enthralled me.

World Without End is a sequel of sorts: it takes place in the same setting of Kingsbridge two centuries later. The story is a bit predictable and the characters unidimensional – I often felt I was observing a nature vs nurture story with nature winning every time – but perhaps the original suffered from the same flaws and I did not notice them as I was much younger. Regardless it made for great storytelling!

Once again, I cared about the becoming of those characters and enjoyed their journey through life.

You can buy World Without End at:
http://www.amazon.com/World-Without-End-Ken-Follett/dp/0525950079/ref=bxgy_cc_b_text_a

If you have not read it, read The Pillars of the Earth (which just made Oprah’s Book Club):
http://www.amazon.com/gp/product/0451225244/sr=53-1/qid=1199466205/ref=tr_351531

Startup Kit / Startup 101: Select Articles for First Time Entrepreneurs to Read

A number of you have asked me which of my articles first time entrepreneurs should read. Here is the list as requested: