ShinyPenny

Revolution Foods / Whole Foods Partnership

The last few months have been exciting ones for the company my wife co-founded, Revolution Foods.  They raised VC funding from JP Morgan and they signed a partnership with Whole Foods.  They hired an executive chef, who amazingly has fantastic experience in both the culinary and education markets.  They leased a kitchen facility and office space in Oakland.  They signed up their first 5 schools (and have a waiting list of more than 30 for next year.)

Perhaps most amazing is that next school year, for the first time, thousands of inner city Oakland children will be eating healthy, organic food for breakfast and lunch.  And even more importantly, they will be learning why eating well is such a critical life skill -- something most of America has apparently not learned (or forgotten), if we take our obesity rates to be a proxy.

Search makes Domain Names Irrelevant

Great article in the WSJ about someone who asked Verisign for a list of all available .com Domain names and analyzed the bejeezus out of them. (click here - sub required)

Don't Google et al. make finding the perfect domain name / URL less meaningful?  I would take a great Page Rank anyday.

Life at the Margins

My friend Cem Sertoglu has a nice post regarding Paul Graham's book Hackers and Painters, and a recent essay about the Power of the Margins.

I've always subscribed to this theory (even if I haven't read Graham's whole book), and have been thinking about its extension and meaning lately.  A few quick thoughts ....

1. In a society where we medicate to bring people "back from the margins,"  (ADD, schizoprenia, mania, etc) do we risk losing an essential creative element in society.  Van Gogh.  The guy who wrote the OED, The Professor and the Madman. Etc.

2. Real Estate.   The trendy neighborhoods are often located "...on the margins."  Red Hook, Brooklyn.  Favela parties in Rio. Etc.  This has more to do with the economic means of those typically living on the margin, but (once again) those on the margin seem to find and create value, even in very physical markets like real estate.

3. The Social Net - a home for those on the margin.  Is the Internet mainstreaming previous marginal behavior by saying .. "if you are different, you are not alone .. there is a website and and online / offline community for you."  What does this do to innovation - does it stifle or enhance?

Microsoft - One Big Flat Tax

Its been fun watching Bill Gates and Warren Buffet link their foundations to the tune of ~61+ Billion.  There really isn't much negative to say about it.  And its large enough that it forces us all to think about its larger meaning, beyond the massive philanthropic effort that it represents.

As I sit here using Firefox for my browser and Thunderbird for my emaill client (but still Windows as my OS), I am reflecting on what MSFT has meant to me over the years.  A lot of hassle, really.  I switched to Mozilla products largely because they offered better features, and less crashes.  But since college I have personally paid at least $10K in license fees to Microsoft for the various products I have used.  And this $10K has served to indirectly enrich Gates, who in turn is using the money to fight poverty, disease and illiteracy.

For those that have watched The Corporation, this represents a whole new take on business.  It is "personally responsible business."  It is not new (look at the Rockefeller Foundation, the Ford Foundation, the Packard Foundation, etc), but the scale is new.  The Gates/Buffet Foundation will be 10 times the size of the next biggest foundation.

Which brings me to Warren Buffet, someone I have always liked.  He is putting his money into the Gates Foundation, and keeping his name off the door, thereby negating one of the largest historical drivers of "mass philanthropy" -- a branded legacy.  No doubt 50 years from now Gates will be better known for his philanthropy and Buffet renown as a classic value investor.  But Buffet doesn't care.  This is as ennobling a move as we've seen in mass philanthropy, and in my view should be the headline.

Ibanks Cleaning Up

Lehman just announced their profits doubled.   So did Goldman.  And anyone who is watching the IB business knows that an increasing share of these profits come from the proprietary trading desks of these organizations.  Of course, these banks are also taking on higher risks, putting more of their balance sheets in play.

But does anyone else find these results fishy?!  The banks are "beating the Street" quarter after quarter.  Of course there is the occasional miss, where a trading desk gets called out and loses $200M, but I have not heard of one recently.

The answer lies in the fact that the Ibanks have placed themselves at the nexus of information and human capital.  I have no doubt, that within a fairly limited spectrum, they do recruit a higher percentage of the "best and brightest" than most industries.  But they also have their "ears to the ground" like no other organization -- they understand they can make high quality trades with great information, and they have modeled their businesses to attract this information.

They see everyone's trades.  They get leads from their hedge fund clients, private equity clients.  I would guess a good deal of information drifts across the Chinese Wall from their M&A group.  (Even though they would be loath to admit it.)  They have high level contacts in governments where they do privatizations and other floats.  They have research analysts scouring the "channel" and piecing together investment theses.  They have proprietary data models that help them see opportunities.  They are truly at an "information delta" and  use their proprietary trading desks to farm the soil.

Couple of questions about this position.  Is it legal, or should it be?  Do they have such a large advantage that they are becoming the WalMarts of information / trading?

Secondly, if competitive pressures within the industry are so strong, are they being forced to put increasingly larger portions of their balance sheets at risk, and therefore increasingly vulnerable to a melt-down that could drastically effect the global economy?  It would be interested to know how correlated Wall Street's proprietary trading desks are.   My bet is that they are more correlated than most would care to admit.

Revolution Foods

I continue to be excited and proud to watch my wife help build a business .. while 7 months pregnant.

Revolution Foods will be in operation next year, drastically improving the food and nutritional education at Oakland public schools. 

It makes me think of the formation days at SelectMinds, a company I helped found in early 2000.  The risk-taking, the highs, the lows ... the "we're all in this together" feeling of an early team that is hungry to make their mark.

I'll keep this blog posted on their progress.  Some very interesting partnership discussions are underway, as I write .. hope to have an announcement here soon.

How Good is our Military?

An intentionally provocative use of the word "good."  For this post, lets leave the morality meaning of "good" alone (as in good vs evil), and instead focus on whether our military is "good" in terms of how prepared it is for the task at hand in Iraq.

There is now widespread recognition that we are fighting a classic guerilla war in Iraq, with the opposition 90% comprised of Iraqi nationalists, with the remainder coming from other Arab countries in the name if jihad. 

The troubling news is that the US is batting 0 for 3 when faced with a classic insurgency scenario, as Tom Bissell points out in an excellent article in this month's Harper's.  Counting our fiascos in Lebanon and Somalia, as well as the archetypal insurgency experience in Vietnam, our military has repeatedly shown an inability to respond to and surmount classic guerilla tactics.

Mind you, I don't have specific advice for our troops.  There are many brave and noble souls working everyday in the name of US interests.  But its certainly well-worth pointing out that our troops will be there longer than we think, with lackluster odds of success. 

Again, from Bissel's article that describes a brief history of insurgencies ... "the Chinese Communists fought for almost thirty years, the Vietnamese Communists exactly thirty years, the Sandinistas for almost twenty years, the Palestinians for almost forty years, the Chechens for ten years, Al Qaeda itself for more than twenty years ..."

So this is going to be a long and drawn out fight.  And the US is going to have to do something radically different this time to win.  I would suggest that statecraft (diplomacy) will have to play a central role in the process. 

We can fly predator drones, and our soldiers can pass out candy, but until our army deploys 10,000 Arab speakers on the streets of Iraq, who are also culturally fluent, we stand a good chance of simply repeating history. 

A Pit in my Stomach

Just a few minutes ago, Governor Schwarzenegger refused clemency for convicted murderer, and long time death row habitue, Tookie Williams.

There is not much more to say than what has already been said in the media and blogosphere. 

When future generations look back on us, from an academic, historic, and sociological perspective, they may very well divide civilization into two buckets -- those that sanction the institutionalized killing of their citizens, and those that do not.  Look at this list -- which group would you rather your country be in?

The US is not keeping good company these days. 

WSR

 

Brundibar at the Berkeley Rep

Last evening Kris and I went to the Berkeley Repertory Theater to see the world premier of the musical Brundibar.

Brundibar was originally written as an opera by Hans Krasa in the concentration camp Theresienstadt in occupied Czechoslovakia, and was performed by the children of the camp.  Theresienstadt was a way-station for Auschwitz, and almost all of the original child-actors, as well as the composer Hans Krasa, were later murdered there.

It has been performed hundreds of times since in the form of an opera, and was recently turned into an illustrated children's book by Tony Kushner ("Angels in America") and Maurice Sendak (prolific children's book author, including "Where the Wild Things Are.")  Kushner and Sendak also collaborated on the musical version of Brundibar, which the Berkeley Rep premiered and will continue to show through January 2006.

Kristin and I originally thought the play would be an uplifting story about the triumph of good over evil, even in the most desperate of times.  On one level, it is:  the story starts with a brother and sister, desperate to bring home milk to their sick mother, busking in the streets.  Brundibar, an evil organ player, chases them away from the town square since he does not want them detracting from the tips that he might receive for his music.  With help from a talking dog, cat and bird, the children eventually triumph over Brundibar, and are able to bring home milk to their mother.

But the historical context of the opera negates such a simple interpretation.  It turns out that the Nazis used Brundibar as a propaganda piece, showing it to concentration camp visitors, including the Red Cross, to "market" the camp as a bucolic and harmless place where prisoners of war were interned for a while.

So Brundibar becomes a double allegory: the power of the human spirit in the most desperate of times, but also the power of the state to re-interpret that allegory for its own use.   Brundibar's survival over the decades, and most recently in this excellent and titillating production, provides perhaps the ultimate tribute -- it allows us all to contemplate the horrors of the Holocaust through the voices and minds of the children, children who were both victims and lynch pins of a play that will hopefully be produced for years to come.

How fast are you growing?

Last Sunday Kris and I went to the RISE holiday party at the Great American Music Hall in the Tenderloin neighborhood of San Francisco.  Kris worked for RISE for two years before attending business school at Haas, where she is now a 2nd year MBA candidate.  For those of you who are not familiar with RISE, it is an organization that seeks to support and retain high quality teachers in schools operating in low income communities.

Temp Keller, the founder of RISE, shared an interesting anecdote in his opening comments.  He rhetorically asked the question - "How do you assess teachers in public schools?" By way of answering, he shared a conversation he had with the Scientific Director of PARC, the esteemed research center of the Xerox Corporation, where many of the brightest minds in research grapple with today's most vexing scientific problems.

Apparently when PARC recruits researchers, it asks them one fundamental question in the interview process: "How do you know you are developing into a leading scientist in your field?"  Most interviewees grow red in the face talking about publications, awards, etc.  At which point the question is re-asked: "How do YOU know YOU are developing into a leading scientist in your field?"

The interviewer is looking for the candidate to have an intrinsic measure of worth and accomplishment.  This begs the question -- how should we measure ourselves, our own personal, emotional, physical and professional development?

A worthwhile question if you ask me.