Product-Market Fit | Mauboussin | Long Nose of Innovation | Remarkable2 Tablet

Sajith Pai's irregular newsletter #9

Here is another issue of my somewhat irregular newsletter:) Comprises thoughts too long for twitter, but too unpolished for blogposts.

For newer subscribers, a PSA. All issues follow a template. There are three sections.

• Writing(s) - a piece of my original writing(s) or a link(s) to one

• Listening(s) - notes on a podcast (or two) I listened to and liked

• Readings - excerpts from 3-5 articles or books that I enjoyed with my take on it. 

I may skip Writing or Listening if I haven’t done either that week or preceding weeks.

Here we go. Feedback in the comments or at sp@sajithpai.com (on anything re the newsletter). If you want to reach me for a funding request then write in at sp@blume.vc (replies in 3-4 days).

Writings

November was a busier writing period than usual for me; I wrote 3 articles. Two of them were directly related to Product-Market Fit, a big area of obsession for me (it is what I focus on most with the founders I support). I am also putting together a comprehensive playbook for achieving Product-Market Fit, and hence I find myself doing a lot of reading and thinking on this topic. The third article was somewhat related to Product-Market Fit, though it focused on a topic around (startup) org design.

Here they are

• Down the ‘Product-Market Fit’ Rabbit Hole! - I explore the history and origin of the term ‘product-market fit’ here. 

• Defining ‘Product-Market Fit’ - What is Product-Market Fit or PMF? I define PMF as predictable, repeatable, positive customer acquisition.

• The Congruent Square - On better aligning the four mechanisms or pillars of the startup org - product, market, go-to-market and team - with each other.

Listenings

1. Michael Mauboussin on Acquired Podcast w hosts Ben Gilbert & David Rosenthal

Highlights from the podcast, scrapings of what I found interesting and useful from the original transcript of the podcast is here. 

Link to podcast + complete transcript. The podcast (and of course the highlights above) constitute a good introduction to Michael Mauboussin's work and interests. Michael is one of the clearest financial analysts and thinkers today. I have really enjoyed reading his detailed reports on the rise of venture + private asset classes, and the challenges traditional accounting faces with intangibles.

In the podcast, Michael talks to the hosts Ben and David on a variety of topics including what he learned from his mentor + guru Al Rappaport, how traditional accounting is grappling with rising intangibles, mental models to use in investing, and finally the story of how Bill Gurley launched himself into prominence as a young and rising financial analyst!

2. Michael Seibel on the Y Combinator Podcast w host Craig Cannon

Link to the original podcast.  The podcast episode features Michael Seibel discussing five of his popular pieces aloud with Craig Cannon. 

I focus here on one of those articles, 'The Real Product-Market Fit', and the 13-minute snippet relevant to it. Here is a link to the complete transcript of that snippet hosted on my notion site. A partial transcript exists here but the complete one is particularly useful if you are founder seeking product-market fit.

Readings / Scrapings

Presently reading the book ‘The Wright Brothers’ by David McCullough. Fascinating book, and there is a lot to unpack here from the lens of a startup, which I am keeping for a future newsletter.

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Otherwise, I have been reading a lot of articles. My new workflow which consists of me transferring pdfs of articles to read to my Remarkable2 device has been helping. I use the device for reading + annotating and not for taking notes (which is the market the manufacturers are after. For me it is a hardware Pocket / Read It Later. Here is what it looks like.

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Listing articles I enjoyed reading and scrapings from them below

Difficult Conversations by John Danner: As the organisation scales, founders will start having to hire and work with 7 on 10 calibre people. Till the org is small it can have a small set of high quality 8/10 to 10/10 folks. If founders hire below 8 on 10 they can fire them etc.  But as the org grows, they have to work with these 7 or 6 on 10 people. This article has a good framework for founders to work with such mid-level talent without getting too frustrated. 

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Amongst other articles, I particularly enjoyed this interview of Atlassian cofounder Mike Cannon-Brookes. Recommend it for the Decision Tree metaphor, his P1-P2-P3-P4 prioritisation framework, his idea of promoting ‘glassbreakers’ etc.

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Great essay on the long nose of innovation, describing the shape of the innovation-monetisation curve, by computer scientist Bill Buxton. Essentially, he says, it takes a long long time, typically as long as 30 years even for a technology to move from invention to commercialisation. Gives examples of the computer mouse and capacitive multi-touch (pinch and zoom on smartphones).

“What the Long Nose tells us is that any technology that is going to have significant impact in the next 10 years is already at least 10 years old. Any technology that is going to have significant impact in the next 5 years is already at least 15 years old, and likely still below the radar. Hence, beware of anyone arguing for some “new” idea that is “going to” take off in the next 5 years, unless they can trace its history back for 15.6 If they cannot do so, most likely they are either wrong, or have not done their homework.”

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TIL that the word ‘meritocracy’ was a neologism (new word) coined to satirise an emerging class, by a British sociologist-turned-politician Michael Dunlop Young. Interestingly it is now shorn of the original negative connotations. 

Michael Dunlop Young wrote an interesting ‘novel’ in 1958 called The Rise of the Meritocracy, describing a make-believe Britain of 2034 where meritocracy ruled supreme, and the world was divided into various classes basis IQ tests:)

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I love the idea of 'recommended reading' as a way to align beliefs and purpose.

In the early PayPal (Thiel/ Musk days), Cryptonomicon by Neal Stephenson was required reading for all. In our buzzy portfolio co, Ultrahuman, it is two books on science and health. 

Here is Mohit Kumar, cofounder Ultrahuman (via the Founders Speak interview series).

“…there is a book called ‘Why We Get Sick’. It’s a book by Benjamin Bikman, definitely a very good read. It changes your perspective about how you look at disease and sickness and health. And there’s another one, which is my personal favourite and it’s called Microbe Hunters. It’s a book on scientific curiosity. The second one is a little dated as a book, but it’s certainly very, very interesting. It’s more applicable in a philosophical sense, and it’s also from a mindset perspective. So there are two books that we generally request people to read, and then have a conversation with them around these two.”

FIN/

That is it folks, for this issue. Feedback in the comments or at sp@sajithpai.com (on anything re the newsletter). If you want to reach me for a funding request then write in at sp@blume.vc (replies in 3-4 days).