CDOQ

Intelligence is a function of the environment. 

In the semiconductor industry, the adage 'eat or be eaten' emphasizes the need for continuous improvement and strategic expansion, often by acquiring adjacent businesses with complementary or superior technologies. The SaaS industry operates under a similar principle. To thrive, SaaS companies must constantly innovate and enhance their product offerings, whether through internal development, strategic partnerships, or acquisitions. 

Temporariness is permanent. 

Last week, I attended the Bay Area IPO Summit , hosted by the Connor Group . The process of going public is a complex ecosystem involving a wide range of specialized participants. Below are my key insights from the summit, shedding light on the current dynamics of the IPO market. IPO: A milestone in a company's journey (image credit DALL-E) Current State  1. Improving Market Conditions : The IPO market is showing signs of recovery. Year-to-date, 2024 has seen 30% more IPOs than the entirety of 2023. Additionally, over $300 billion in venture capital "dry powder" remains available for investment in the US. 2. Revised Definitions: Investment bankers now define "high growth" as achieving over 30% year-over-year revenue growth, while "profitability" is simply a business generating more than break-even profits. 3. Supply Constraints: Contrary to popular belief, there is no shortage of investor demand for IPOs. The real issue lies on the supply side—few hi

Earlier this week, I saw a new friend for coffee—one of the few truly wise people I’ve encountered in Silicon Valley. What follows is unadulterated wisdom from my friend:   Wisdom over coffee 1. Separate style from substance. Most people judge others based on their message delivery style rather than the content itself. To understand people better, focus on what they’re saying, not how they’re saying it. 2. Test for trustworthiness. To know if someone is trustworthy, look for contradictions in what they say. 3. Evaluate the substance-to-noise ratio. If someone speaks charmingly for a long time to convey something simple, they might have a hidden agenda.  4. It is hard to figure out in an interview if the candidate is trustworthy but you can understand their grasping power [intellect] and articulation [communication] skills.  5. Smart bosses do their best to keep their smart employees. 6. Watch for noise in data. For example, data might show that firetrucks are called to a city 100 times

"Travelling comfortably dominates people's thinking when they should be thinking about destinations."  -Nick Sleep 

Semiconductor Business FAQ  Q1: What are the fundamental differences between the semiconductor business and a typical B2B SaaS startup? A: The semiconductor industry differs significantly from software-based startups, primarily in terms of investment scale, development cycles, and market dynamics. Here's why: i) High Capital Investment & Longer Timeframes: Semiconductor development demands significant upfront investment, often reaching tens of millions of dollars, with multi-year development cycles before a product can even be tested. This contrasts sharply with the iterative, lower-cost nature of software development. ii) Targeting Large Markets: Due to the hefty initial investments, semiconductor companies must target large, high-volume markets to achieve profitability. A single design win in a consumer device like a smartphone can translate to millions of units sold. iii) Limited Iteration: Unlike software, where updates and bug fixes can be rolled out relatively easily, mak

A few days ago, I attended one of the first non-academic robotics conferences, Actuate , in San Francisco. One of the most fascinating insights was the early evidence suggesting that robots trained using a variety of data ( cross-embodiment training )   can outperform specialized robots at their own tasks. For example, a robot trained on diverse tasks—such as walking, assembling, and manufacturing—could perform better at picking objects than a robot trained exclusively for that task. Robots in our life (image generated by DALL-E) Following are my key observations from the conference:  1. Physical Intelligence , a silicon valley startup, raised $70M in seed round to build a general robotics model which can be used by different kinds of robots to do various tasks.  2. This idea of general model for robotics is called Robotics Foundation Model  (RFM). The concept is pretty similar to Large Language Model (LLM) which are the basis for Generative Artificial Intelligence (AGI).  3. There is

This is a briefing doc based on a discussion between Arne Tonning and Chander Chawla based on Chander's Magnet Strategy .  Main Themes: Sustaining Growth: The conversation focuses on how established companies can continue growing even after achieving significant scale and market saturation. Beyond Incrementalism: While incremental product improvements and geographic expansion are important, truly disruptive growth often requires more radical approaches. Tech Giants as a Model: We analyze the strategies of companies like Apple and Google, highlighting how they leverage their size, technology, and data to enter new industries. Key Ideas and Facts: Seven Strategies for Sustained Growth: 1. Incremental and Adjacent Product Improvements: Iterating on existing products, developing complementary offerings, and targeting new geographic markets. Example: Apple launching Apple Music, Apple News, and the Apple Watch alongside its core iPhone business. 2. R&D (Research and Development): In

Four years ago, Arne Tonning and I recorded a podcast episode on  Product Management with AI.  Today, I asked NotebookLM  to create a study guide based on the podcast transcript.  See the guide below. I think it is pretty good :)  Product Development in the Age of AI: A Study Guide  Quiz Instructions: Answer the following questions in 2-3 sentences. 1. What are the core principles of Lean product development? Lean product development centers around building a minimum viable product (MVP) with minimal resources, rapidly testing it with users, gathering feedback, and iterating based on that feedback to achieve product-market fit. 2. How did the rise of the internet and cloud computing impact the feasibility of Lean and Agile methodologies? The internet and cloud computing enabled faster iteration cycles and easier deployment of updates. This made Lean and Agile methodologies more practical as companies could quickly push changes to their products based on user feedback. 3. According to

“Love all, trust a few, Do wrong to none: be able for thine enemy Rather in power than use; and keep thy friend Under thy own life's key: be check'd for silence, But never tax'd for speech.” ― William Shakespeare, All's Well That Ends Well "English" translation using ChatGPT:  "Love all, trust a few": Be kind and compassionate to everyone, but trust only a select few people. Not everyone is trustworthy, and wisdom lies in knowing whom to trust. "Do wrong to none": Do no harm to anyone; live in a way that is morally good and avoid causing others pain or suffering. "Be able for thine enemy rather in power than use": Be capable of dealing with your enemies, not by constantly using your power, but by having it at your disposal when necessary. It’s about being prepared without being aggressive. "Keep thy friend under thy own life's key": Maintain control over your close relationships; don’t give away too much of yourself

The desire to be right often outweighs the need to understand.

Why do some companies thrive while others falter? This question captures the essence of business strategy and is crucial for every business leader and investor. The key to success often lies in the dynamic interplay between a company's strategic direction and its executive team's ability to execute. Using the business outcomes matrix below,  we will explore a framework that provides insights into this question. Business outcomes matrix Understanding the Matrix This matrix is divided into four quadrants, each representing a unique combination of the quality of your strategy and the strength of your team: 1. Failure (Bad Strategy, Bad Team) This quadrant represents the worst-case scenario for any company—having both a poor strategy and an ineffective team. A bad strategy might involve misreading market trends, focusing on the wrong customer needs, or failing to differentiate from competitors. Coupled with a team that lacks the necessary skills, vision, or drive, companies in this