Chamath Palihapitiya's
2019 Annual Letter
March 9, 2020
CEO of Social Capital, a private VC firm
The annual letter itself may be found here: https://www.socialcapital.com/annual-letters/2019
Instead of creating a lengthy series of Tweets, I decided to quote those excerpts that I had found noteworthy. Everything is verbatim quotes except for the titles.
Capital Misallocation
"The cost of the entire Apollo program was $25 Billion or $150 Billion in today’s dollars.
Big Tech spent $75B on R&D in 2018 alone. Put another way, this means that in two 2018 equivalents of R&D spending, Big Tech could have sent people to the moon and back. It's fair to say, however, that what we have witnessed instead can graciously be described as something less ambitious and impactful than that."
(Under "Big Tech", Chamath specifically names FAAMG: Facebook, Apple, Amazon, Microsoft, Google.)
Investing isn't a Team Sport
"I’ve learned that investing isn’t a team sport. Company building is a team sport but capital allocation isn’t. It's about a few good decisions, from time to time, supported by a lot of idiosyncratic thinking, reading and debate. I’m thankful to my team who helps me make these good decisions."
Value of Cash
"Selling, when appropriate, and generating cash in a thoughtful way seems to be a prudent decision for the next several years."
Candid, Honest Opinions
"Many of the opinions raised thus far are complicated and potentially off-putting. That said, our track record has reaffirmed our need to be, if nothing else, candid and honest."
Focusing on What's Most Important to Oneself;
The Transition from Gilded Age to Progressive Era
"As we enter the final years of the Gilded Age and usher in the Progressive Era, a more civilized culture will hopefully abound. Today, it’s not just the stock market but also the fragmentation, polarization and judgement that are at all time highs.
Is this really the hallmark of a society that is progressive? No. It's the remnants of unhappiness, resentment and anger that personify the Gilded Age. That said, it's so much easier to be happy and see the bigger picture when you focus on what matters. So how does one focus on what matters? I’ve found it possible by asking questions like “what matters to me?” and “what is important to me?” These may sound like the most basic questions but they are also the most critical. And especially now, these are the questions that need lucid, non-judgemental [sic] answers from each of us.
For me, I have learned that my family, my health and what I know (knowledge) are the most important things that matter to me. Work, money and friendships are important but come strictly after the first three. What doesn’t matter? Everything else, particularly, what others think about me and my decisions."
Author is also on Twitter
