Quote of the week:

“The stock market is a device to transfer money from the ‘impatient’ to the ‘patient’.” (Source)

Tony Seba on the five ‘phase change’ disruptions of the 2020s

Tony Seba recently published a multi-part video series exploring his research on how a convergence of new technologies are leading to a radical “rethinking of the future.” Seba provides both analysis and a compelling framework to understand how several sprawling economic sectors—e.g. transportation, food and agriculture—are shifting at a quickening pace. “S-curves are accelerating,” Seba says. “Disruptions that may have taken decades in the past, now they’re taking place in years.”

“In the 2020s, key technologies are converging that will disrupt the five foundational sectors of the economy: Information, food, energy, transportation, and materials. These are phase-change disruptions, I’ll explain what that means. But if all you do is walk away with that concept today, then that is what explains what is going on in the world. Phase change disruptions are happening at all levels—at the product level, at the sector level of the economy, and even all of society.”


“Get a horse!” Skepticism during early technology paradigm shifts

Throughout history, technology disruptions—from medicine to phones to rockets—follow predictable cycles from skepticism to hype to eventual mainstream adoption. This week, I happened to revisit a favorite article of mine from the early days of the combustion engine car, written by Alexander Winton, an early pioneer of the auto industry.

Reflecting on the earliest days of car manufacturing, Winton observed: “To advocate replacing the horse, which had served man through centuries, marked one as an imbecile…” While it seems obvious now in hindsight that cars would replace horses, Winton writes about the deep incredulity the industry faced in its early days, the hundreds of car startups that never made it, the importance of vertical integration, and much more. In the piece, Winton quotes Thomas Edison:  

“It is only a question of a short time when the carriages and trucks of every large city will be run by motors. The expense of keeping and feeding horses in a great city like New York is very heavy, and all this will be done away with. You must remember that every invention of this kind which is made adds to the general wealth by introducing a new system of greater economy of force. A great invention which facilitates commerce, enriches a country just as much as the discovery of vast hoards of gold.”

A few more links I enjoyed: 

“The thing that year in and year out remains to be true, especially in the entertainment and gaming business, is the only grader of your decision that matters is your customer. We are definitely in a want-to-do activity, not a have-to-do activity. We are entertainment. We’re kind of an at-will activity. When people decide to spend their most precious resources — which are obviously their time and their finances — in gaming, and they choose to play a game with us on our platform or one of our first-party games, that is the thing that sits at the center of every decision that we make as a team. ‘What would our customers think?'”
“But the other thing I’d say is one, the transaction’s too complex. We’re making that very simple. We’re going to standardize the transaction around a simple process. It’s also too lengthy. So, sellers don’t know how many steps they need to take, how many open houses. We’re going to going to confine that to a certain timeframe. There’s way too much uncertainty. And so with our system, all of our offers are guaranteed to close. So, that gives them certainty that there isn’t renegotiation around repairs at the point of sale.”

This information should not be considered a recommendation to purchase or sell any particular security. It should not be assumed that any of the investments or strategies referenced were or will be profitable, or that investment recommendations or decisions we make in the future will be profitable. This article contains links to 3rd party websites and is used for informational purposes only. This does not constitute as an endorsement of any kind. While Nightview uses sources it considers to be reliable, no guarantee is made regarding the accuracy of information or data provided by third-party sources. Nightview Capital Management, LLC (Nightview Capital) is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Nightview Capital including our investment strategies and objectives can be found in our ADV Part 2, which is available upon request.