Let’s reduce gun violence in 333 words

November 6, 2017

Americans like their guns, with about 300 million guns in circulation.  But they have risks. They kill 33,000 people a year and gun violence cost $229 billion. Per year.

Americans like their cars, with nearly 300 million of them on the road. But they have risks. They kill 37,000 people a year and deadly accidents cost $435 billion.  Per year.  Including property costs for those crashed cars.

These are strikingly similar numbers.  The biggest difference between these two examples?  Mandatory insurance.

To manage the risk of automobiles, we are each required to purchase insurance for our cars which covers the cost of accidental (or intentional) death.  Median car insurance is $1,250 per year.

Gun owners are not required to purchase insurance for the risks of gun ownership.  Gun risk costs $0.00 for owners.  The cost is paid instead by victims.

Actuaries at insurance companies are very good at calculating the costs of risk.  What type of vehicle do you have?  Are you young or old?  How is your driving record?  Where do you live?

Actuaries could become very good at calculating the odds of a gun, or an owner, doing something bad accidentally (or intentionally).  Do you have a history of violence? Is it a .22 rifle or an AR-15?  Kids in the house?  Then insurers pay up if violence occurs.

Governments are incredibly bad at calculating the costs of risk.  Gun registries, waiting periods, prohibitions on gun types and limits on crazy people’s gun ownership are political compromises and poorly implemented.

Imagine what happens after mandatory gun insurance engages the insurers’  profit motives.  Costs will be high for more dangerous guns, reducing their use.  A $1,200 per year, per gun insurance bill, with detailed checks prior to ownership, will reduce ownership.  If personal liability continues even if the gun is stolen or resold, then theft and resales decline, too.

This is not “gun rights” vs. “gun control”.  Keep your guns, if you want.  This is letting the free market price the risk and neatly align the American capitalist way with a Constitutional right.

 

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Today we hacked a Tesla … it was easy.

October 25, 2017

This is a story about technologist training and responsibility, but it starts with an interview with a potential tech developer, which included this exchange:

Me: “I’ve been thinking of some practical tests I can give you for skills assessment, and –”

Developer: “If you want, I can hack your Tesla.  It only takes about 5 minutes.”

Me: “Umm, OK?”

And sure enough, 5 minutes later, after getting me to download an “SSL certificate” to my phone (the sort of stuff that could be buried in an app download), my car was unlocked and the windows were down.  When he started trying to use the “Summon” function to pull the car out the parking space, I’d had enough.

Now, about my “training and responsibility” opening line.  The developers at Tesla, when coding the API between their phone app and their cloud connection to the car, send completely unencrypted messages.  My developer interviewee was able to see signals exchanged like “door_unlock”.   Hmm, I wonder what that does….

Developers are trained, and companies are built, around fast development cycles.  Consumers want the latest features.  Facebook advertisers want a way to target and place advertising.  Drivers don’t want to think about their self-driving cars deciding between a killing 5 children in a crosswalk or the old dude behind the useless steering wheel.

But in the rush to get new tech out the door, human fallibility along with systems geared toward fast features with limited bugs, means we’re shortcutting security (my Tesla today), legality (Russians placing campaign ads on Facebook), and morality (self-driving car accident avoidance algorithms).

We don’t teach development organizations these things.  We don’t reward them for their sophistication in these areas.  And we really, really need to start that dialogue, and that education.  I’m a tech investor, a trained techie, and I love tech.  But we need to build these new perspectives and systems right now.  Because humans are fallible, and the failure modes around increasingly sophisticated technology are increasingly impactful and dangerous.

 

PS. We hired the dev.  In fact, we’re acquiring his company.

The Mistake of Missing the Meta

August 25, 2017

In our second week of dating, the girl that would become my wife tried to end our budding relationship.  It started when I was making an important point, which went like this:

I said, “All adults are screwed up somehow, right?”  She nodded, so I continued,  “That means all children grow up to be screwed up adults.”  She looked at me enraptured, or so I thought at the time.  Now I’m pretty sure it was disdain.  I concluded, “Thus, as a parent, the best one can do is screw up one’s children intentionally instead of unintentionally.”  My face no doubt showed a mixture of smugness and triumph at my cleverness and cuteness.

And she said, “Get out of my house.”

I made a mistake, and thankfully she forgave me for it (and plenty of others since).  The mistake is a mistake we all make, constantly, and we need to work on it.  I made the mistake of missing the meta:  the meta-language, the meta-conversation, the meta-context.  Meta is what’s beyond what’s going on right in front of us.  It’s the “third eye” described by mystics that gives extra perception of the situation.  And in this conversation, the missed meta was “I’m speaking with a mother that might take offense”.  And she rightly did take offense.  Another missed meta was “you’re trying too hard to be clever”.

With a healthy dose of meta, we can understand ourselves better, understand the positions of others, and build bridges that are missing.  It makes disagreements more human, solutions more inclusive, and builds context for our situations.

Unfortunately, either as humans or in this particular era, we are struggling with meta.  We have a President with no meta.  We have self-obsessed reality TV stars that miss the meta.  We have Justin Beeber.  Losing ourselves in electronics is a great way to avoid the higher order thinking and observation that meta requires.  Dehumanizing the opposition is lost meta.  Feeling clever rather than kind is lost meta.

This is an easy thing to fix.  In fact, you have the skills today.  You have a voice in your head (or one of many) which is a detached observer.  It’s an ongoing commentary on “what is this person really saying” or “why am I truly behaving this way at this moment.”  Or even “why am I reading this article about Taylor Swift’s new album when I don’t listen to Taylor Swift and I was originally shopping for contact lens solution?”  Seek out that voice, turn up the volume, and create change for the better.

 

I Moved One Inch, and Found This.

June 20, 2017

I was having a horrible time on my last bike ride. The same hills I typically ride seemed particularly steep. I even hated the bike, a new one, and it apparently didn’t like to climb. Every pedal stroke was “this sucks”.

Then I moved my seat 2cm, less than an inch. And suddenly the bike was wonderful. Turns out the new bike position was wrong, putting too much strain on certain muscles and not enough on others. I moved my perspective one inch, and it gave me a new context — from “sucky” to “joy”. It’s the same emotional transformation that occurs when changing the station after Justin Bieber comes on.

It reminded me that plenty of life’s challenges come not from the situation, but from my context.

“Context” is what we are bringing to the situation, as opposed to what the situation is bringing to us.

If there is a disagreement with colleagues in a conference room, my context can be “my colleagues are out to get me” or “working together to get the best answer”. If I’m listening to my wife, my context can be “I’m bored” or “demonstrate love through listening”. These are things that are entirely in my control, in the moment, and relatively easy to change. Easier to change than my personality, my skill set, or the other people.  As easy as moving one inch.  My negative emotions come from my wrong perspective.

What’s your context when things suck? Do you question it in the moment? Do you change it? How?

The biggest risk to democracy isn’t Trump. It’s this.

May 31, 2017

Trump is not a sickness. Trump is a symptom.  While Trump could be a symptom of many things, I’ll focus on this one big risk to democracy: we’ve become a class society with little chance for change.  And we’re risking the nation because of it.

Like many of you, I grew up being told a few things by my parents:

  1. I’m middle class
  2. In America, you can move up with hard work
  3. If you don’t like the government, you can vote to change it. Your vote matters.

These are social stress “pressure relief valves”.  Sadly, they aren’t true anymore.  You’re stuck.  Not only are you stuck you got where you are not on your own but more because of your situation (e.g. seemingly all Nascar drivers are sons of Nascar drivers).  And you are powerless to change your lot.  This is the recipe for rebellion.

Point 1.  The middle class isn’t as well off as it used to be. The middle 33% of the US has household incomes of $30,000 to $62,500. The poverty line is $24,250 in household income. A single shock, like a health problem or a layoff, can push most middle class families into poverty.  I suspect if you are reading this, your household is in the upper third of incomes.  You and I don’t really understand the challenges of the bottom 2/3rds.  We need to start.

Point 2.  You can’t move up, your parents were just kidding when they said that.  The US is more like the UK in terms of upward mobility, and the UK is well known for it’s class system.   The US has as much upward mobility as Pakistan, and worse than Denmark, Sweden, and Japan.  These are not the first countries we think of when we think of dynamic entrepreneurs rising from poverty to success.

According to journalist Jason DeParle:

At least five large studies in recent years have found the United States to be less mobile than comparable nations. A project led by Markus Jantti, an economist at a Swedish university, found that 42 percent of American men raised in the bottom fifth of incomes stay there as adults. That shows a level of persistent disadvantage much higher than in Denmark (25 percent) and Britain (30 percent)—a country famous for its class constraints.[27] Meanwhile, just 8 percent of American men at the bottom rose to the top fifth. That compares with 12 percent of the British and 14 percent of the Danes. Despite frequent references to the United States as a classless society, about 62 percent of Americans (male and female) raised in the top fifth of incomes stay in the top two-fifths, according to research by the Economic Mobility Project of the Pew Charitable Trusts. Similarly, 65 percent born in the bottom fifth stay in the bottom two-fifths.

The reasons for immobility, and it’s associated inequality, are policies like real estate zoning, which keep people segregated.  Zoning policies were exclusionary, and often racist, up through the Fair Housing Act of 1968.  Once segregated, all one’s friends, connections, summer internships, and schools are similarly segregated.  Legacy college admissions, where children of alumni are given preferential treatment, is an American only system to prevent changes to the cultural makeup of universities.

How can we possibly be a united nation when we don’t mingle?

Point 3.  If you don’t like it, vote for change.  Except, the voting process is a mess.  Congress has an 11% approval rating but a 96% reelection rate.   In a presidential election, New Mexico, New Hampshire, and Nevada have more than 40 times the voting power of Arkansas, Alabama, and Kentucky.  Gerrymandering makes the will of the voters matter less:

Does my vote really matter?

What we are left with is class stress that we don’t even admit.  It’s the reason that voters can ignore experts, ignore media, insult and harm people that are Americans but classified as “other”.  These voters can rationally claim “those experts/media/minorities/Americans don’t know me.  I don’t see them in my neighborhood, and if I do they are taking my job or scaring me!”

Solutions to these class problem are unattractive for people like me living above that middle 33%.  Inheritance taxes were designed to reduce class stress by reducing inter-generational wealth.  They are at their lowest levels in decades.  They could be increased.  School budgets are tied to segregated real estate values.  They could be untied, leveling educational access.

These are politically unpopular ideas.  But the alternative may be a more explosive pressure release — starting with a Trump presidency, who harnessed the anger to win election but is inept at governing — and ending with a more talented demagogue that harnesses anger and tears the system down, Constitution and all.

Corporate VCs Should be Killing It Versus Private VCs

March 28, 2017

Corporate venture capital is one of the fastest growing areas of venture capital investment. Too many of these efforts are going to suck and fail. As The Donald would tweet: Bad!

They really shouldn’t fail, though. Corporations have fantastic relationships, expert employees to leverage, and internal demand for start-up companies to exploit.

To personally have those advantages as an investor, I would quite possibly listen to an entire Justin Bieber album. Well, maybe most of one. Private VCs have to work hard to build relationships, understand sectors, and seek out customers for their startups. Private VCs are disadvantaged in this regard.

Corporations, though, fail at one big thing. They treat VC like a corporate activity. Corporate hierarchical decision-making is slow and doesn’t adapt to the pattern matching and imperfect data that is present in startup investment decisions. Corporate pay scales virtually prohibit hiring investors with 10 years experience, successful track records, and networks of relationships, all required in the fragmented venture business. Corporations get confused on their goals, leading to short term commitments to investments that are long term illiquid. I could go on.

Private VCs have just one thing in their favor. They are more egalitarian in their decision-making and they are singularly focused on making money. Yes, I’m aware that is two things, but that destroys the symmetry of the language. Stay focused, reader!

Corporate VC doesn’t have to fail, though. The very best corporate VC functions are incorporating private VC approaches into their efforts. It’s hard, but it’s worth it.

And it’s not just worth it for the economic returns of VC, or for being able to see the latest technologies before the competition. Those are great things, sure. Instead, corporate VC is worth it because once or twice every 5 or 10 years, the Corporate VCs and the companies they work with will have an insight that changes the direction of the mothership. Then, instead of that $100m fund returning $300m in profit, it will alter the course of billions of dollars of mainline business.

It’s happened to others, and if you are a corporate VC group or thinking of starting one, it could happen to you — if you build it the right way.

Things Americans believe in more than Donald Trump

March 24, 2017

A recent Gallup poll put Donald Trump’s approval rating at just 37%, one of the lowest approval ratings ever recorded by Gallup at this point in a presidency.  Here are some things that people believe in more than Donald Trump.

Switching from beliefs to approval ratings, here are a few of the many bad things with higher approval ratings than Trump:

One bright spot, Donald Trumps’ approval rating (37%) is higher than Justin Bieber’s (20%).  But, he’s bigly trailing Vin Diesel (60% approval) and Ben Affleck (62% approval), one of which is just out of rehab.  Bad!

 

Trump’s immigration ban just lost at least 180,000 US tech jobs

January 31, 2017

After months working with a European company to set up their Silicon Valley venture arm, the company told me this morning they are suspending their plans after Trump’s immigration order. The situation is too chaotic, they said.

That’s $200 million that will not enter the US economy, that will not be invested in US startups and technologies that drive the US economy.

Venture backed startups, both public and private, account for 11% of US jobs and 21% of GDP according to the NVCA and Thomson/Reuters.

$200m is about 1% of annual venture dollars. One could argue that this single decision could remove as much as 0.2% of GDP and 0.11% of US jobs over time. That’s 180,000 jobs depending on your source for jobs data and how quickly funds are invested.

This isn’t politics, this is economic duncery.

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UPDATE:  I made one important assumption in my calculation of lost jobs, which was encapsulated by my short addition of “over time”.  I assumed this isn’t just a single fund, but something that the corporation would do for multiple funds.

The impact of a single fund has to be calculated differently.  Based on about $700B invested over all of venture’s history (data is sketchy between sources for this), a $200m fund is .03% of total capital invested, including recent investments that haven’t yet impacted jobs or GDP data (30% of that $700B has been in the last 5 years, not enough time for the full outcome to be known) .  That’s around 50,000 jobs for just this single fund.

Trump was right about exactly one thing

January 30, 2017

If this is winning, Trump was right, I’m tired of it.  It’s too much winning.

I know lots of folks read my blog to learn about venture capital, technology, or some obscure or obtuse thing I’m thinking.  We’ll get back to that.  Think of this as my ongoing “Constitutional Special Edition”.

At our house we outlined in March four things I would described as “The Four Horsemen of the Constitutional Apocalypse”.  These would be the things that would indicate the potential fall of our government, or it’s reinvention in the Putin/Mussolini/Hitler style.

In the first week, Trump made “progress” on two of them.  The ones he’s making “progress” on are:

  1. Restriction of movement/requirement of citizens to carry papers – an immigration order that affected green card holders and valid visa holders.  Reince Preibus even indicated the order could be expanded to more countries.
  2. Mass firing or resignations of the Joint Chiefs of Staff – Steve Bannon replaces the Joint Chiefs and the Director of National Intelligence on the National Security Council.

    And for your reference, the two he might get to in the next few weeks are:

  3. the creation of “neighborhood watch” or “citizens patrols” to report neighbors and or “keep the peace”.
  4. a terrorist event/fake terrorist event that allows Trump to declare Martial Law.

So while trying to hold Trump accountable to the Law on things like bribes/emoluments, we now have to fight other unconstitutional or controversial items.

And I haven’t even gotten into the attacks on the First Amendment and the maligning of the media. Only tinpot dictators don’t want the press pointing out inconvenient truths.

Recall the goal of a narcissist is to create chaos so as to wear people down and thus exert control.  We can’t get tired, we can’t forget.  This is a marathon, and if you get too riled up too soon, you’ll bonk before the finish.  Then someone else will win.  Beaten, say, by someone who jumps on the subway at mile 7 and jumps back in the race at mile 24 to claim victory.

 

New Year’s lessons from a random 5 year old

January 3, 2017

While on a delightful New Year’s day run, I heard the following conversation between two 5 year old boys.

“How many people exactly love you?” asked one.

“Five,” responded the other, without hesitation and with absolute certainty.

What a great, certain answer! And the question is not about some lower order relationship like “how many Facebook friends do you have?” or even the more adult “how many people would come to your funeral?” It’s about “love”, which is that mysterious, irrational attachment to another person — the thing that would make someone crawl over broken glass for another or listen to Justin Bieber at that person’s request.

And the answer of “five” works out to one person for every year of life. If all of us maintained that pace, our answer should be quite a bit higher than that. If you’re like me, you’re behind plan.

If you don’t have a New Year’s Resolution to build a few one or two deep attachments this year, perhaps this 5 year old can convince you to add it.