No. 255 – Thursday Reads

Source: Niche and Realtor.com

Pittsburgh-Based Niche Secures $35M For School Search Platform After 100% ARR Growth In 2019 – niche is a platform that allows parents to search for schools ranging from kindergarten all the way up to college. what concerns me about this platform is just where we’re headed more broadly in education. A tool like this is more beneficial to the wealthy family that has options in terms of where they can send their children to school. I worry that platforms like this further inequities in education. Look at the map above from Niche’s site where they’ve graded the schools across DC. Guess where the majority of the multimillion dollar homes are?

Another thing that comes to mind is this pandemic has shed more light on our education system – areas where it’s weak, the ability of kids to study from home, the stress kids are under in school, and more. Over the next ten years, where does Niche see its growth coming from to justify a $35M raise? They’re a lot more bullish than I am.

‘Burn. It. The. F#&!. Down.’: The metamorphosis of former hedge fund manager and Epsilon Theory founder Ben Hunt – My buddy Myles Wynn introduced me to Ben Hunt a month or so ago when he wrote a provocative piece questioning the numbers China was reporting on deaths due to COVID-19. This piece does a nice job profiling him. He’s definitely somebody I’m going to be paying more attention to moving forward.

Why Hip-Hop and Gaming are Still Scratching the Surface – Per usual, Dan Runcie does a nice job teasing out opportunities for hip hop artists. In this piece he looks at gaming and how hip hop artists could find an additional revenue stream through partnerships with game development companies in order to put on concerts. He qualifies his analysis by saying that these platforms will need to effectively reach a broader demographic than they currently do in order for artists to maximize the opportunity. Unfortunately, the game development industry is quite monolithic—very white and male. Delane Parnell has built a nice platform on top of the gaming industry facilitating competition through PlayVS, but what black entrepreneurs out there are building new game development businesses?

Ghana’s economy resilient enough to fund healthcare infrastructure – Minister – Earlier this week, I shared my concern with how Ghana was paying for the 88 hotels it planned to start construction on this year. Sure enough, the country is betting on the Sinohydro deal in which China will construct infrastructure in the country in exchange for bauxite. I can’t say that I’m a fan.

Oil Slump, Coronavirus Create a Perfect Storm for Nigeria’s Economy – Back in 2014 or 2015, then Central Bank of Nigeria governor Sanido Lamido Sanusi caused a lot of commotion by claiming that Nigeria’s National Petroleum Corporation had $20B unaccounted for. He eventually lost his job. Around the same time, then finance minister Dr. Ngozi Okonjo-Iweala highlighted how Nigeria needed to meaningfully wean itself off of oil dependence and was ridiculed for her stance. It’s unfortunate to see the tough situation the country is in right now due to this mix of oil prices bottoming out because folks are not moving around. Hopefully, the country emerges from this with a focus on reinventing itself.

No. 238 – A New Poor People’s Campaign

Source: YouTube and CNBC

In typical fashion, Chamath Palihapitiya went on CNBC last week and shook things up by saying that corporations and hedge funds should be allowed to lose their shirts as this recession continues to set in:

This is a lie that has been purported by Wall Street. When a company fails, it does not fire their employees. It goes through a package bankruptcy. Right? If anything, what happens is, the people who have the pensions within those companies, the employees of these companies, end up owning more of the company. The people that get wiped out are the speculators who own the unsecured tranches of debt, the folks that own the equity, and by the way, those are the rules of the game because these are the people who purport to be the most sophisticated investors in the world. They deserve to get wiped out. But the employees don’t get wiped out. The pensions don’t typically get wiped out.

He keeps going. 

Just to be clear on who we are talking about. We’re talking about a hedge fund that serves a bunch of billionaire family offices. Who cares? Let them get wiped out. They don’t get to summer in the Hamptons? Who cares?

Chamath did a nice job here calling out the double standard we’ve kept alive in this country. Over 16 million people have filed unemployment claims in less than a month. These folks have to figure out their next move. Yet, a number of corporations don’t want to have to go through the same struggle.  To their advantage, these corporations have the tools to finesse the situation and get the capital they need to get those resources.

Martin Luther King’s Poor People’s Campaign was an effort to ensure poor folks had a job, unemployment insurance, healthcare, and more. He sought to address an economic system in which poor folks are dispensable. Now, Dr. King was not a capitalist. Chamath is a thorough one. I think there is an overlap though. Capitalists need to lose the double standard for how they’re treated when hard times come, so that when folks follow the formula for advancing in society according to capitalist standards, they don’t wind up grasping at a mirage. Corporations can’t tell folks to follow a capitalist path while they operate with selective socialism.

Dr. King saw that there needed to be a mass movement to shift the needle on this issue—put pressure on the powerful to see the importance of being straight with how the economy is structured. The people have to be paying attention and applying pressure to ensure our system operates well for us. This passage from a letter Thomas Jefferson wrote to British minister Richard Price comes to mind:

“I did not at first believe that 11. states out of 13. would have consented to a plan consolidating them so much into one. A change in their dispositions, which had taken place since I left them, had rendered this consolidation necessary, that is to say, had called for a federal government which could walk upon it’s own legs, without leaning for support on the state legislatures. A sense of this necessity, and a submission to it, is to me a new and consolatory proof that wherever the people are well informed they can be trusted with their own government; that whenever things get so far wrong as to attract their notice, they may be relied on to set them to rights.”

In order to set things right, regular people need political machines working on their behalf to ensure the Business Roundtable members stick to their promise to stakeholders and go toe-to-toe with entities like the Managed Funds Association. I’m not sure that we have machines like that right now. What organizations come to mind for you that could get the job done?

No. 232 – Monday Reads

A Prime Minister Tries to Storm-Proof Her Island’s Finances – “We wanted to come up with something that was conducive to bolstering resilience to rising climatic risks,” Espinosa says. “Adverse-weather clauses provide vulnerable sovereign debtors with a degree of flexibility by creating built-in buffers that can help them absorb some of the financial impact.”

Stakeholder capitalism is urgently needed – and the COVID-19 crisis shows us why – “What’s interesting about this crisis is it’s really revealed so many problems that we have in our current way of doing capitalism. There’s different ways to do capitalism.”

Axios-Ipsos Coronavirus Index: Rich sheltered, poor shafted amid virus – “47% of respondents designated as coming from the upper socioeconomic status and 45% of those from the upper-middle status said their emotional well-being declined. That was the case for just 34% of the lower and lower-middle groups and 36% of the middle group.”

Post Corona: Higher Ed “SARS was huge for e-commerce in Asia, and it helped Alibaba break out into the consumer space. COVID-19 could be to education in the United States what SARS was to e-commerce in Asia.”

Early Data Shows African Americans Have Contracted and Died of Coronavirus at an Alarming Rate – “When COVID-19 passes and we see the losses … it will be deeply tied to the story of post-World War II policies that left communities marginalized,” Sprague said. “Its impact is going to be tied to our history and legacy of racial inequities. It’s going to be tied to the fact that we live in two very different worlds.”

No. 90: Thursday AM Reads and Listens

No. A little over a year ago, Jehiel was telling me about this idea he had for smart tractors. A few days ago, he talked about what Hello Tractor is doing while moderating a panel with President Obama. Amazing.

It is so frustrating to read story after story on America’s failing infrastructure.

Great post by Mark Suster on startup failure.

Barry Ritholtz’s Masters in Business podcast is quickly becoming one of my favorites. Here’s a great one with Dambisa Moyo, though he interrupted her a lot.

Mind boggling graphics on China’s investment around the world.

Nice rundown of the latest in the startup scene across Africa.

First Round Capital looked at ten years worth of data from its time investing in startups at the seed stage. The findings are interesting, though I don’t feel comfortable with the “Where You Went to School Matters” finding. I think that propagates some of the diversity issues in the US technology startup scene.

I highly recommend you read Ta-Nehisi Coates’ new book, Between the World and Me. I’ve been struggling with writing a post on it, so I’m just going to sit with it for a while. Perhaps I’ll have something of substance to say later.

No. 88: Thursday Morning Reads 

Tidjane Thiam gets off to a nice start at Credit Suisse

Silicon Valley’s Political End Game

Rocket Internet’s portfolio value has grown $2.5 billion in nine months 

Wistia founder shares how not being fake helped them close an account with a big customer 

Not sure I buy the analysis that Eurobond issuances among African countries with increase in the second half of this year 

Interesting points on what DC needs to do to prepare for population growth to 800k

Ethiopia centralizes coffee regulation; Nigeria rice industry dealing with Dangote’s push to eliminate imports; Ghana giving sugar another shot

New York fast food workers get their salary doubled

No. 71: Anthony Scaramucci and Henry Blodget on Failure

For the righteous falls seven times and rises again, but the wicked stumble in times of adversity. Psalm 24:16

I discovered a new podcast earlier this week, Masters in Business, with Barry Ritholtz. Two of his recent interviews were with Anthony Scaramucci, head of Skybridge Capital, a hedge fund and host of the SALT Conference, probably the biggest conference for the hedge fund industry. I have found him to be fascinating for the past several years just because he seems to be everywhere – raising money for presidential candidates, running his firm, putting together this massive conference, hosting television shows. So, here was a great opportunity to learn more about the man. He talks a lot about failure in his interview with Ritholtz, beginning with getting fired from Goldman Sachs about 18 months after joining the firm.

Henry Blodget is co-founder and CEO of Businessinsider.com is wired into my finger tips. It is literally the first thing I type when I open my browser. Their coverage of business, technology, finance, and other news is fast and accessible, though I have been critical of their Africa coverage. Henry Blodget was formerly a star technology analyst on Wall Street. His claim to fame was making a predicting that Amazon’s one-year price target was $400. Amazon surpassed that not long after his call. During the tech bust, Blodget got caught up in an SEC investigation for civil securities fraud, coughing up a total of $4 million and accepting a lifetime ban from Wall Street. His conversation with Ritholtz covers his recovery from that failure.

Both Blodget and Scaramucci failed at various points in their careers. Both got up. Helpful stories to hear.

No. 59: President Obama’s Business in Africa Advisory Council Held First Meeting This Week

Last year, Commerce Secretary Penny Pritzker stood up the President’s Doing Business in Africa Advisory Council, a group of small, medium and large US businesses currently engaged in business on the continent and tasked with helping shape U.S. policy for business engagement with the continent. 

The makeup of the council is very interesting. You’ve got people ranging from Dominic Barton, head of McKinsey, to Kevon Makell, head of a renewable energy consultancy based in Charlotte, to Karen Daniel, CFO at Black and Veatch. 

If you’re as slow as I am at washing dishes, that two hours will give you enough time to watch this two-part recording of the advisory council’s first meeting on April 8. 

Part 1

Part 2 

Three things caught my attention during the meeting:

  1. Mr. Barton challenged the Council to think big, specifically in positioning the US to double its share global trade with the continent in five years. In 2013, our share was down to 7 percent from 13 percent in 2001. Compare that with China which has gone from 3 percent to 14 percent in the same window. 
  2. Wal-Mart was very clear in communicating that African countries not meeting its logistical needs amongst others should not expect partnerships equal to what countries that did meet their needs would experience. 
  3. The various US agencies that have significant engagement on the continent don’t really know what tools they have respectively for engagement on the continent. This includes OPIC, USAID, the State Department, and the U.S. Ex-Im Bank. Their representatives seemed to agree on the need for better coordination. 

One of the recommendations that stood out was a US-Africa Infrastructure Center which would equip US infrastructure developers to more effectively compete for deals on the continent. This struck me as a platform that could be helpful in tracking progress in closing the gap on the World Bank’s projection of $93B per year for 10 years investment in infrastructure across the continent

Further, the platform could serve as a helpful marketing tool in showing the effectiveness of US infrastructure developers in terms of time to completion, total project cost, lifespan of finished projects before maintenance, among other metrics.  Then again, it may be a better move to invest in the work already done by the African Development Bank, World Bank, and other stakeholders in setting up a platform focused on infrastructure development. 

The council meets next in September or October. I look forward to tracking their progress. Hopefully, I would have figured out how to be helpful to their work in some way by then. 

No. 32: Reflections from NYU Africa Economic Forum

“I don’t feel pressure from being the President of the Toronto Raptors. I feel pressure from Africa.”  The energy that entered the room when Masai Ujiri said that at yesterday’s NYU Africa Economic Forum is why I am still awake.

Masai went on to say that his work would be a waste if he didn’t have any impact in Africa to show for being NBA Executive of the Year or potentially winning an NBA championship. Boom!

Masai’s speech was the highlight of the NYU Africa Economic Forum, though three ideas from other speakers really got my brain going and I may dive deeper on them later this week.

Makhtar Diop, World Bank VP for Africa, explained how pursuing a credit rating for Senegal while he was Minister of Finance provided investors data they could understand, subsequently increasing their level of interest in placing capital in the country. 

Ken Ofori Attah, retired CEO of Databank, stressed the importance of Diasporans marketing Africa well. 

Eric Guichard, CEO of Gravitas Capital and Homestrings, highlighted the opportunity for the structuring of projects to satiate the perceived lack of capital and projects from the perspectives of companies and investors, respectively. 

Kudos to the NYU Africa Economic Forum team for keeping me up way past my bedtime!

What else? What ideas struck you at the NYU Africa Economic Forum?

No. 30: I Enjoyed Speaking at Yale’s Sankofa54 Conference

I am on the train headed back from Sankofa54: The Youth Empowerment Conference, nicely put on by the Yale Undergraduate Association of African Peace and Development. I spoke on a panel addressing Africans Investing in Africa, an issue that has kept
me awake at night since high school. The other panelists were Solomme Lemme, founder of Africans in the Diaspora, and Adewumi Mobolaji, special advisor to the CEO at Aso Savings and Loans Bank.

Solomme challenged the audience to imagine the impact 1 percent of the 60 billion dollars that is remitted to African countries could have on development if targeted towards initiatives focused on creating transformative change on the continent.

Adewumi covered macro developments that are creating the environment for increased investment on the continent, while also highlighting challenges that are still present in the quest for a strong investment climate on the continent.

I found a way to weave an Anansi story into my talk – major win.

One of today’s keynote addresses came from Ladi Delano, an entrepreneur who has been getting it done for about a decade. He made some great points on the need for the extermination of Africa’s corruption problem. He discussed the need for greater manufacturing to meet consumer demand. He cited a recent meeting he had with the head of Massmart Nigeria and how little sense it made to him learning that all of its products are imported.

Another keynote speaker was Obinna Ukwauni, a senior economics major at MIT. Beast. This guy has started an initiative to teach robotics to secondary school students in Nigeria with support from organizations like Shell and Innoventures – quite impressive. He plans to use this as a step towards launching a school in Nigeria in partnership with MIT’s Media Lab.

Last night, Nobel Prize recipient Leymah Gbowee discussed the challenges of being a mother and in-demand activist. She did not regret having missed a significant portion of some of her children’s lives on account of her belief that she was laying the foundation for their futures. Tough.

I was really impressed that undergraduates put on a conference of this caliber and I appreciate YAAPD inviting me to speak. I look forward to next time!