Surf Report: As long as you're smiling you're doing it right
Issue 7: Nov 15, 2020 (Free Edition)
INTRODUCTION
November 15, 2020
Hi everyone! I’m so glad to have you here. What a week.
First of all, big news: we’re now over 100 signups strong 😳
I also want to give a shoutout to all the new paying subscribers who have hopped into the Surf. The support has been incredible. This basic report will always be free for all but it’s made possible by all of our contributing Pro members. I’ve also started removing sponsored content from the Pro edition of this newsletter too, adding ad-free to the list of perks ✨
And thanks to all this support I’ve started work on some resources to give all of you, including a new (free) ebook. Everyone who is signed up before the release will be included so if you know someone who might like this newsletter please forward along! 🙏
This week’s essay, Shovels & Batteries: How I think about one of my favorite investment theses, was a discussion of an investing concept that included mention of a stock I find interesting, $KCAC—part of a larger EV trend currently playing out. While none of these emails are inducements to invest in a particular security (you gotta do your own research before making decisions with your money and I can never guarantee returns), I did open a position in $KCAC last week which already netted me 41.06% return on the 20% I sold:
I mention it mainly to highlight what I’m trying to do with this newsletter, both free and Pro alike: surface profitable ideas and concepts that can help inform your decisions when it comes to the world of marketing and markets. It’s all about fresh ideas and perspectives that have the potential for big upside.
I’ll continue tweaking and refining things based on what you all find most helpful, so don’t hesitate to reach out with feedback. That’s what surfing the markets is all about: not predicting waves but surfing the ones you have, adjusting your positioning as you go based on the information that you get.
“When you know the pattern of a given situation, you can act in accordance with it and not overly force things.” —Alan Watts, writer & philosopher
“There are a million ways to surf, and as long as you’re smiling you’re doing it right.” —Mike Coots, surfer, photographer, shark attack survivor, and shark advocate
Have fun out there. And thanks again!
—Mark
“Never discourage anyone […] who continually makes progress, no matter how slow.” —Plato
Breaking 🌊
VF Corporation is buying streetwear brand Supreme for $2.1 billion. Publicly traded as $VFC, the stock jumped more than it ever has in its 33 year history on the news. VF owns over 15 brands including North Face, Timberland, and Vans. So What?: Some think Supreme could have been worth upwards of $10M if left alone or with the management of a more luxury-focused buyer (such as LVMH). So while it may be great news for $VFC it could spell trouble for the long-term credibility of the Supreme brand which, unlike the other brands in the portfolio, trades on scarcity and cool.
Spotify ($SPOT) is buying podcast hosting platform Megaphone for $235M. It’s the latest in a string of podcast-related acquisitions including Gimlet Media ($200M), The Ringer ($196M), Anchor ($14M), Joe Rogan ($100M), and Parcast ($56M). So What?: Spotify is, in effect, trying to acquire an entire industry, and this move is all about the ad revenue. Megaphone hosts over 5,500 shows from big publishers like Slate, iHeartMedia, Disney, and Vox Media, and this means all of those podcasts will have access to Spotify’s proprietary, real-time ad technology called Streaming Ad Insertion after the deal is finalized.
Apple’s new computers are now powered by their proprietary M1 chip, marking the close of their longtime partnership with Intel. They claim improved performance, battery life, and compatibility with all existing apps. The announcement followed new of Apple’s best-ever quarter for Mac sales: $9 billion, up 29%. They’re so all-in on their new system-on-a-chip that they’ve already stopped selling the Intel-powered Macbook Air, their best-selling Mac by far. So What?: By eliminating the old option Apple will accelerate adoption while projecting the confidence needed in what is now a truly unique offering. Owning more of the supply chain also gives Apple the benefit (and responsibility!) of more control.
Take-Two Interactive is buying UK game studio Codemasters for just shy of $1B. Take-Two ($TTWO) is already the owner of hugely popular franchises 2K Games (licensed pro sports) and Rockstar Games (Grand Theft Auto, Red Dead), and now adds F1, Dirt, and Project Cars’ series to the mix. So What?: Take-Two’s investment in so many sports franchises gives them a catalog of yearly-updated releases with loyal followings, which positions them to have more reliable recurring revenue streams than publishers of more one-off hits and sequels.
Billionaire hedge fund manager and legendary investor Stan Druckenmiller casually mentioned on CNBC that he has warmed up to Bitcoin and now owns it. “If the gold bet works, the Bitcoin bet will probably work better.” So What?: We’re running out of successful billionaire investors who don’t have exposure to Bitcoin. Its built-in scarcity and completely digital nature makes it the increasingly obvious choice in our online, remote world.
From the Tweetbox 🐦
🔗 Some advice from the earliest investing book, from Amsterdam in 1602 (via @Sarah_Katilyn): “On the off chance that you’re wrong, never give anyone advice to buy or sell shares.”
🔗 “In this business if you're good, you're right six times out of ten. You're never going to be right nine times out of ten” via @DividendGrowth
Instead of watching “the economy” watch our energy usage:
For The Pros 😎
How your marketing is ignoring 97% of your potential customers. 🔗 (Link available to Pro subscribers)
How a top venture capitalist uses Airtable to track and widen his network. “It’s one of the keys to his uncommon success” 🔗 (Link available to Pro subscribers)
Lessons learned from going from $40k per month to $70k in debt. 🔗 (Link available to Pro subscribers)
Worthwhile Long Read ☕️
🔗 Unreal engine is coming for your car. For the first time, the Unreal Engine will be used in a consumer automobile: all displays in the new GMC Hummer EV are powered by the same software that enables some of the most popular and visually stunning video games on the market.
It’s wasn’t a question of visuals, but efficiency:
“Automakers usually have to reprocess all of the imagery and renders of the vehicle down for use on the in-car display and that it can be very resource-intensive. ‘That's something the video game industry has been doing for a long time.’”
Check This Out 👀
DoorDash’s “flywheel” is about as clean and elegant as any you’ll find. (Though Walt Disney’s strategy diagram from 1957 is still my fav):
Tip ☝️
“The easiest way to speak to someone is through something they already know.”
—via @ChristinaTosi, on The Chef Show
PNG 🖼
While data science is slowly trying to convert spreadsheet with into code, excel is sneaking up and letting you do app development from a spreadsheet. Check out the app that gets you “from spreadsheet to web-applications in two clicks”: Appizy
Here’s An Idea 💡
Calm plants the seed of crazy.
“Two things have plunged in the last 80 years: death from bacterial infection, and funding/development of new antibiotics that will combat future infections.
It’s weird to think that Covid would be easier to deal with if we hadn’t made so much infectious-disease progress over the last century. But we did. So now it’s a generational nightmare. Calm plants the seeds of crazy.
A lot of things work like that.
Carl Jung had a theory called enantiodromia. It’s the idea that an excess of something gives rise to its opposite.
When there are no recessions, people get confident. When they get confident they take risks. When they take risks, you get recessions.”
“The beginnings of all things are small.” —Cicero
Groms 🐣
@TaraReed_ has quietly bootstrapped Apps Without Code to $5M/year with enrollment numbers rivaling Lambda School's. She’s one of the leaders of the no-code movement: building profitable apps and SaaS companies by leveraging existing software tools instead of code:
Deft is a new way to find products online. “Type like you speak and search by image (or both) across all product sites.” You can also shop with images instead of text. Super cool idea from @nosduhz:
“Don’t tell me what you think, tell me what you have in your portfolio.” —Nassim Nicholas Taleb
Drop Ins 🏄
My latest investments & trades
Buy & Hold Investments (I will hold these forever)
This section is only available for contributing subscribers. If you’d like to trade and invest along with me, consider one of the paid tiers!
Swing Trades (1-3 month time horizon)
This section is only available for contributing subscribers. If you’d like to trade and invest along with me, consider one of the paid tiers!
Barrels 🎯
Portfolio Highlights
Trade of the Week: $GWPH, scaled out some profits for a ~25% return
Pods & Schools 🐬🐠
Podcast Reco: Randall Stutman: The Essence of Leadership [The Knowledge Project Ep. #96]:
“What leaders do is they make situations and people better.”
Book Reco: No B.S. Sales Success in The New Economy, by Dan S. Kennedy
“A great deal of traditional sales training focuses on ‘closing’ but I maintain, if you need to ‘close,’ you opened poorly.”
Interview Reco: Freddie Laker speaks with Jane Barratt, Chief Advocacy Officer of MX Technologies, on what the industry missed when the real digital transformation happened.
“I think that’s still a huge missing piece from career advice: understanding how your company makes money, how you contribute to it, and what’s your worth relative to that contribution…”
Tools of the Trade ⚒
Products I use to make money
Wealthfront. ~25% of my portfolio is in Wealthfront, which since 2016 has netted me a time-weighted return of ~39% (~35% money-weighted) at the time of this writing, all while harvesting tax losses like the pros do.
Use this special link to get your first $5,000 managed for free: https://wlth.fr/2ephpyb
StockCharts. I easily make back the small monthly subscription fee with the superpowers it gives me.
Carrd. Use this link or referral code 892PYX69 to start your own web empire.
Cointracker. Track your coins like you track your stocks.
Hypefury. Easily the best tool out their for growing a quality Twitter following.
Validate Your Business Idea: Includes everything from researching, writing, getting attention, and engaging with people, plus a spreadsheet template for tracking subs. Surf Report subscribers get $5 off with the code: surfreport
SPONSOR
Sforzo Audace is my own company—lifestyle brand for renaissance men and creator of the Original Renaissance Bag. “One can do much.” Surf Report subscribers get an extra 20% off with the discount code SURFREPORT at checkout. 🔗 Get yours at renaissancebag.com
Disclaimer
Nothing in this email is intended to serve as financial advice. Do your own research.