Elon Musk at MIT’s AeroAstro Centennial Symposium

Sunday, October 26th, 2014

At the MIT Aeronautics and Astronautics Department’s Centennial Symposium, Elon Musk spoke.

He considers The Moon is a Harsh Mistress Heinlein’s best novel, and he wonders why rocket engines are always mounted on gimbals, and airplane engines never are.

How Palmer Luckey Created Oculus Rift

Monday, October 20th, 2014

If there is a case to be made that unconventional schooling, without busywork or fixed schedules, helps unleash creativity, Palmer Luckey, creator of the Oculus Rift, might well be Exhibit A for the prosecution:

His mother, Julie, home-schooled all four of her children during a period of each of their childhoods (Luckey’s father, Donald, is a car salesman), but Palmer was the only one of the kids who never went back; he liked the flexibility too much. In his ample free time, he devoted most of his considerable energy to teaching himself how to build electronics from scratch.

No one else in Luckey’s family was especially interested in technology, but his parents were happy to give over half of the garage at their Long Beach, California, home to his experiments. There, Luckey quickly progressed from making small electronics to “high-voltage stuff” like lasers and electromagnetic coilguns. Inevitably, there were mishaps. While working on a live Tesla coil, Luckey once accidentally touched a grounded metal bed frame, and blew himself across the garage; another time, while cleaning an infrared laser, he burned a gray spot into his vision.

When Luckey was 15, he started “modding” video game equipment: taking consoles like the Nintendo GameCube, disassembling them, and modifying them with newer parts, to transform them into compact, efficient and hand-crafted devices. “Modding was more interesting than just building things entirely using new technologies,” Luckey told me. “It was this very special type of engineering that required deeply understanding why people had made the decisions they made in designing the hardware.”

Luckey soon became obsessed with PC gaming. How well, he wondered, could he play games? “Not skill level,” he clarified to me, “but how good could the experience be?” By this time, Luckey was making good money fixing broken iPhones, and he spent most of it on high-end gaming equipment in order to make the experience as immersive as possible. At one point, his standard gaming setup consisted of a mind-boggling six-monitor arrangement. “It was so sick,” he recalled.

But it wasn’t enough. Luckey didn’t just want to play on expensive screens; he wanted to jump inside the game itself. He knew the military sometimes trained soldiers using virtual reality headsets, so he set out to buy some — on the cheap, through government auctions. “You’d read that these VR systems originally cost hundreds of thousands of dollars, and you thought, clearly if they’re that expensive, they must be really good,” Luckey said. Instead, they fell miles short of his hopes. The field of view on one headset might be so narrow that he’d feel as if he was looking through a half-opened door. Another might weigh ten pounds, or have preposterously long lag between his head moving and the image reacting onscreen — a feature common to early VR that literally makes users nauseated.

So Luckey decided to do what he’d been doing for years with game consoles: He’d take the technology apart, figure out where it was falling short and modify it with new parts to improve it. Very quickly, he realized that this wasn’t going to be simple. “It turned out that a lot of the approaches the old systems were taking were dead ends,” he said.

The problem was one of fundamental design philosophy. In order to create the illusion of a three-dimensional digital world from a single flat screen, VR manufacturers had typically used complex optical apparatuses that magnified the onscreen image to fill the user’s visual field while also correcting for any distortion. Because these optics had to perform a variety of elaborate tricks to make the magnified image seem clear, they were extremely heavy and costly to produce.

Luckey’s solution to this dilemma was ingeniously simple. Why use bulky, expensive optics, he thought, when he could put in cheap, lightweight lenses and then use software to distort the image, so that it came out clear through them? Plus, he quickly realized that he could combine these lenses with screens from mobile phones, which the smartphone arms race had made bigger, crisper and less expensive than ever before. “That let me make something that was a lot lighter and cheaper, with a much wider field of view, than anything else out there,” he said.

From 2009 to 2012, while also taking college classes and working at the University of Southern California’s VR-focused Institute for Creative Technologies, Luckey poured countless hours into creating a working prototype from this core vision. He tinkered with different screens, mixed and matched parts from his collection of VR hardware, and refined the motion tracking equipment, which monitored the user’s head movements in real-time. Amazingly, considering the eventual value of his invention, Luckey was also posting detailed reports about his work to a 3-D gaming message board. The idea was sitting there for anyone to steal.

But, as Brendan Iribe put it to me, “Maybe his name is Luckey for a reason.” By that point, no one was interested in throwing more money away on another doomed virtual reality project.

Then, in early 2012, luck struck again when the legendary video game programmer John Carmack stumbled onto his work online and asked Luckey if he could buy one of his prototypes. Luckey sent him one for free. “I played it super cool,” he assured me. Carmack returned the favor in a big way: At that June’s E3 convention — the game industry’s gigantic annual commercial carnival — he showed off the Rift prototype to a flock of journalists, using a repurposed version of his hit game “Doom 3” for the demonstration. The response was immediate and ecstatic. “I was in Boston at a display conference at the time,” Luckey said, “and people there were like, ‘Dude, Palmer, everyone’s writing articles about your thing!’”

The rest, as they say, is virtual history: Over the next 21 months, Luckey partnered with Iribe, Antonov and Mitchell, launched a Kickstarter campaign that netted $2.4 million in funding — nearly ten times its initial goal — and joined the Facebook empire, thereby ensuring the company the kind of financial backing that most early-stage tech companies can only dream of.

The Oculus Rift is now entering its final stages of development — it’s slated for commercial release next year — and this fall Samsung will release a scaled-down product for developers and enthusiasts, powered by Oculus technology, that will clip over the company’s Galaxy Note 4 smartphone. But Luckey knows that success is by no means assured. “To this point, there has never been a successful commercial VR product, ever,” Luckey told me. “Nobody’s actually managed to pull this off.” Spend a few minutes inside the Rift, though, and one can’t help but believe that Luckey will be the one to do it.

Apple’s Next Big Imitative Leap

Monday, October 20th, 2014

Apple is just buying time until its next big imitative leap:

Samsung debuted its first, much maligned and hugely successful Galaxy Note — the first phone with a bigger-than-5-inch screen — in September, 2011. For two years afterwards, Apple was content to present incremental improvements to the iPhone. Compared with the iPhone 5, the iPhone 5s just added a fingerprint sensor and an improved camera (plus a few other features that most consumers didn’t care about).

Meanwhile Apple carefully observed the “phablet” market, watched other handset makers follow Samsung’s example and erode its market share, and experimented with ways to make a big phone easier to navigate one-handed. It struck just when Samsung started posting lower profits, because of the increased competitive pressure.

It was a perfectly-timed attack and, after setting a first-weekend record — 10 million iPhones sold — iPhone 6 and iPhone 6 Plus are continuing their rampage. Apple chief executive Tim Cook said yesterday that the first sales month for the two new phones was the company’s best ever “by a lot. A whole lot.”

The iPad Air 2′s most important improvements on last year’s device are, again, a fingerprint sensor and a better camera. As with iPhone 5s in 2013, it may appear as if Apple is stuck in a rut of timid, incremental innovation. My bet, however, is that it’s watching another innovator collect bumps, get bad reviews, then get things right. Once that innovator’s success is assured, Apple will pounce.

This time it isn’t a Samsung product Apple is watching, but Microsoft’s Surface Pro.

Microsoft hit on the idea of producing a tablet-laptop cross in 2012, incurring losses and writing off inventory as it refined the concept. This year, it finally produced a device that reviewers liked — the Surface Pro 3. It’s reasonably convincing both as a laptop and as a tablet, albeit a large and heavy one. Microsoft has not released numbers, saying only that the Pro 3 was its fastest-selling tablet yet — the company underestimated demand, creating shortages in some markets.

The analysis company Gartner puts the Surface Pro in the same category — “premium ultra-mobile” computers — as Apple’s MacBook Air laptops.

Altucher on Personal Finance

Sunday, October 19th, 2014

James Altucher provides a “real education” on personal finance:

A) Don’t save money. Make more. If you think this is not so easy then remember: whatever direction you are walking in, eventually you get there.

B) That said, don’t spend money on the BIGGEST expenses in life. House and college (and kids and marriage but, of course, there are exceptions there). Just saving on these two things alone is worth over a million dollars in your bank account.

C) But doesn’t renting flush money down the toilet? No, it doesn’t. Do the math. You can argue all you want but the math is very clear as long as you are not lying to yourself.

D) Haven’t studies shown that college graduates make more money 20 years later?

No, studies have not shown that. They show correlation but not causation and they don’t take into account multi-collinearity (it could be that the children of middle class families have higher paying jobs later and, oh by the way, these children also go to college).

E) Don’t invest in anything that you can’t directly control every aspect of. In other words…yourself.

In other words:

  1. You can’t make or save money from a salary.And salaries have been going down versus inflation for 40 years. So don’t count on a salary. You’re 20, please take this advice alone if you take any advice at all.
  2. Investing is a tax on the middle class. There are at least 5 levels of fees stripped out of your hard-earned cash before your money touches an investment.

F) If you want to make money you have to learn the following skills. None of these skills are taught in college.

I’m not saying college is awful or about money, etc. I’m just saying that the only skills needed to make money will never be learned in college:

  • how to sell (both in a presentation and via copywriting)
  • how to negotiate (which means win-win, not war)
  • creativity (take out a pad, write down a list of ideas, every day)
  • leadership (give more to others than you expect back for yourself)
  • networking (a corollary of leadership)
  • how to live by themes instead of goals (goals will break your heart)
  • reinvention (which will happen repeatedly throughout a life)
  • idea sex (get good at coming up with ideas. Then combine them. Master the intersection)
  • the 1% rule (every week try to get better 1% physically, emotionally, mentally)
  • “the google rule” – always send people to the best resource, even if it’s a competitor. The benefit to you comes back tenfold
  • give constantly to the people in your network. The value of your network increase linearly if you get to know more people but EXPONENTIALLY if the people you know, get to know and help each other.
  • how to fail so that a failure turns into a beginning
  • simple tools to increase productivity
  • how to master a field. You can’t learn this in school with each “field” being regimented into equal 50 minute periods. Mastery begins when formal education ends. Find the topic that sets your heart on fire. Then combust.
  • stopping the noise: news, advice books, fees upon fees in almost every area of life. Create your own noise instead of falling in life with the others.

If you do all this you will gradually make more and more money and help more and more people. At least, I’ve seen it happen for me and for others.

Sexual Harassment at Restaurants

Wednesday, October 15th, 2014

Scott Adams (Dilbert) adds some context to the report that 90% of women in restaurant jobs that depend on tipping report being sexually harassed at work, based on his own restaurant-owning experience:

I believe it is true that 90% of women working for tips in restaurants are sexually harassed by coworkers and/or customers. That fits my personal observations after working in the industry. But let’s put some context on that and see if your feelings about the story change.

For starters, let’s remove from the stats the folks who take jobs at Hooters and other restaurants that position the staff’s appearance as part of the “entertainment.” I would argue that those employees are signing up to be sexually objectified in return for the promise of easy work and good tips. You can make a convincing case that Hooters should not exist, but I don’t think you can lump the servers at Hooters with the servers at Applebee’s and get a good statistic on restaurant sexual harassment in general.

So let’s say the non-Hooters rate of sexual harassment for female restaurant workers is something like 80%. That still sounds terrible. But I’m not done with context yet.

In my experience, attractive female bartenders and servers are completely conscious of trading their sexuality for higher tips. They talk about it freely. They pick blouses to accentuate their best assets. And some will admit they choose jobs that allow them to trade on their looks. If I were in my twenties and could make money in a job that depended on my looks instead of my muscles I would take it in a heartbeat, assuming I had good looks.

My best guess is that if you remove from the stats the women who are intentionally using their sexuality to improve their income, you get about 50% of women in tipping jobs who get sexually harassed and have done nothing intentionally to inspire unwanted attention. That is still a horrible number.

But 50% is also the rate of men who report being sexually harassed in server jobs. In my restaurant experience, when we had handsome male bartenders or servers the female staff and customers were shameless with their non-stop sexual banter, flirting, and direct sexual offers. And if you thought all of that attention was the good kind, you’d be wrong. It was an ongoing problem for the guys. The handsome gay servers had it the worst because they had no upside potential from the female attention.

So here’s the proper context, in my opinion, based on years of direct restaurant experience: 100% of attractive men and women are sexually harassed at work in the restaurant business. And nearly every one of them took the job knowing that would be the case, but they decided it was worth it for the relatively easy money.

Big Med could learn a lot from the Cheesecake Factory

Tuesday, October 14th, 2014

It’s easy to make fun of the casual dining sector, but Big Med could learn a lot from the Cheesecake Factory, Atul Gawande says:

One study examined how long it took several major discoveries, such as the finding that the use of beta-blockers after a heart attack improves survival, to reach even half of Americans. The answer was, on average, more than fifteen years.

Scaling good ideas has been one of our deepest problems in medicine. Regulation has had its place, but it has proved no more likely to produce great medicine than food inspectors are to produce great food. During the era of managed care, insurance-company reviewers did hardly any better. We’ve been stuck. But do we have to be?

Every six months, the Cheesecake Factory puts out a new menu. This means that everyone who works in its restaurants expects to learn something new twice a year. The March, 2012, Cheesecake Factory menu included thirteen new items. The teaching process is now finely honed: from start to finish, rollout takes just seven weeks.

Peter Thiel Converses with Bill Kristol

Saturday, October 11th, 2014

Bill Kristol has a conversation with Peter Thiel:

CrossFit Preschool

Saturday, October 4th, 2014

CrossFit gyms are now offering preschool programs:

In preschool CrossFit, dangling off hanging bars is likened to being a monkey. Squats are frog-inspired. Box jumps, plyometric leaps long beloved by elite athletes, are smaller and rebranded for kids as superhero leaps.

In Long Island City, a tunnel constructed from red tumbling mats inspired comparisons to snakes and worms. Games and exercises were punctuated by water breaks and doodling. CrossFit Kids instructors are discouraged from telling children to lift weights or move faster, Martin said. High-fives for effort are prevalent.

[...]

For some parents and children, CrossFit has become an alternative to the travel teams and year-round youth sports schedules that can be so demanding.

Creating a Nation of Readers

Wednesday, September 24th, 2014

Publishers gave away over 100 million books during World War IIgood books, in a disposable format:

Serious books were hard to find before the war. An industry study in 1931 highlighted the book trade’s limited audience. Nineteen out of every 20 books sold by the major publishing houses cost more than two dollars, a luxury even before the Depression. Those who could afford them often struggled to find them. Two out of three counties in America lacked any bookstore, or even so much as a department store, drugstore, or other retailer selling enough books to have an account with a publishing house. In rural areas, small towns, and even mid-sized cities, dedicated customers bought their books the way they bought other household goods, picking the titles out of mail-order catalogs. Most did not bother.

There was another, less-reputable class of books, though, that enjoyed broader distribution. Cheap mysteries, westerns, and comics could be snapped up at newsstands in paperbound editions that cost far less to produce than hardcover books. Throughout the 1920s and ’30s, publishers tried to take advantage of this format to publish a wider range of books. Most efforts failed. Then, in 1939, two new entrants changed the equation. Pocket Books and Penguin Books each offered a mix of new titles and reprints of hardcover books, including some of a literary bent. More importantly, they sold these paperback books on magazine racks.

Americans could put down a quarter and pick up a book all over town, from train stations and drugstores. Within a year, Americans bought 6 million paperback books. By 1943, Pocket Books alone printed 38 million copies. “It’s unbelievable,” said the head of Random House. “It’s frightening.”

Old-line publishers had good reason to be scared. They were in the business of selling a premium product to an affluent audience. The sudden flood of paperbacks threatened to swamp their refined trade and erode its prestige. The cheap, disposable format seemed best suited to works of little lasting value. That Penguin and Pocket Books included some distinguished titles on their lists threatened the stability of these categories, even as their sales still tilted heavily toward the lower end of the spectrum. Paperbacks were expanding the market for books, but that market remained divided.

Then, war intervened. The key actors in the book trade organized themselves into the Council on Books in Wartime, hoping to use books to advance the war effort. In February of 1943, they circulated an audacious proposal. They proposed to print and sell millions of books to the army, for just six cents a volume.

Hardcover books could not possibly be produced so cheaply. But magazines could. So the Council decided to use magazine presses, printing two copies on each page, and then slicing the book in half perpendicular to the binding. The result was a book wider than it was tall, featuring two columns of text for easier reading in low light. The real innovation, though, was less technological than ideological. The publishers proposed to take books available only in hardcover form, and produce them in this disposable format.

The plan, breathtaking in its ambition, was sure to engender skepticism among publishers asked to donate the rights to some of their most valuable property. So the chair of the committee, W.W. Norton, took care to appeal not just to the patriotism of his fellow publishers, but also to their pursuit of profits. “The net result to the industry and to the future of book reading can only be helpful,” he explained. “The very fact that millions of men will have the opportunity to learn what a book is and what it can mean is likely now and in postwar years to exert a tremendous influence on the postwar course of the industry.”

The program turned The Great Gatsby into a success. Apparently A Tree Grows in Brooklyn was hugely popular with the troops.

(Hat tip to Steve Sailer.)

Jack and Jack

Friday, September 19th, 2014

Being famous in the age of social media means you can have a giant tour bus with your face on it and a line of screaming teenage fans, even if no one else in the world cares:

Jack and Jack — as their Vine fans affectionately call them — represent your classic new millennial celebrities. [...] At the end of their junior year in high school, they started filming Vines together as a comedy duo, without bigger intentions of fame. But one breakout clip of theirs — “The Nerd Vandals” — went viral. That was all it took to get the celebrity train going.

[...]

After that clip, Johnson and Gilinsky’s fan base started growing of its own volition. They had 1,000 followers when Jack Johnson went away to summer camp, and when he returned they hit 25,000. Now, roughly a year later, they’re up to 4.4 million followers on Vine, half a million subscribers on YouTube, and more than a million followers apiece on Instagram.

[...]

At the time of publishing this story, their biggest hit, “Tides,” is currently number 7 on the iTunes charts, behind Taylor Swift’s “Shake It Off” and newcomer Meghan Trainor’s surprise summer hit “All About that Bass.” The only other artists in front of Johnson and Gilinsky are major names like Maroon 5 and Ariana Grande. In other words, the two teen boys are killing it.

[...]

“It’s so weird,” Johnson says. “We have this fan base of millions of teenage girls, but no one knows it. It stays between these teenage girls.”

The Tim Ferriss Show

Tuesday, September 16th, 2014

If you enjoyed Peter Thiel’s recent AMA, you might also enjoy his quasi-interview on The Tim Ferriss Show.

For that matter, you might also enjoy the previous episode, with the most interesting man in the world, Kevin Kelly.

Ask Peter Thiel Anything

Thursday, September 11th, 2014

Peter Thiel is doing a Reddit AMA. Some highlights:

  • Most people deal with aging by some strange combination of acceptance and denial. I think the psychological blocks to thinking about aging run very deep, and we need to think about it in order to really fight it.
  • The zero-sum world [The Social Network] portrayed has nothing in common with the Silicon Valley I know, but I suspect it’s a pretty accurate portrayal of the dysfunctional relationships that dominate Hollywood.
  • Start with focusing on a small market and dominate that market first.
  • What did you think when you first met Elon Musk? Very smart, very charismatic, and incredibly driven — a very rare combination, since most people who have one of these traits learn to coast on the other two.
    It was kind of scary to be competing against his startup in Palo Alto in Dec 1999-Mar 2000.
  • Is Palantir a front for the CIA? No, the CIA is a front for Palantir.
  • If technology involves doing more with less, than US health care (like US education) is the core of “anti-technology” in this country: For the last four decades, we have been spending more and more for the same (or even for less).
  • At 22, I didn’t think it was important to meet people.
  • In your view, has the Thiel Fellowship been a success? Yes, on both a micro and a macro scale.
    Micro: the 83 fellows have collectively raised $63 million, and a number of their companies are tracking towards solid Series B venture rounds. Almost all of them did and learned far more than they would have in college.
    Macro: we started an important debate about the education bubble. Student debt is over $1 trillion in this country, and much of that money has gone to pay for lies that people tell about how great the education they received was.
  • I like the genre of past books written about the future, e.g.: Francis Bacon, The New Atlantis; JJ Servan-Schreiber, The American Challenge; Norman Angell, The Great Illusion; Neal Stephenson, The Diamond Age.
  • In the Soviet Union, chess was considered a sport — and I think that’s the one thing the communists got right.
  • I don’t agree with the libertarian description of the NSA as “big brother.” I think Snowden revealed something that looks more like the Keystone Kops and very little like James Bond.
  • Most people believe that capitalism and competition are synonyms, and I think they are opposites. A capitalist accumulates capital, and in a world of perfect competition all the capital gets competed away: The restaurant industry in SF is very competitive and very non-capitalistic (e.g., very hard way to make money), whereas Google is very capitalistic and has had no serious competition since 2002.
  • PayPal built a payment system but failed in its goal in creating a “new world currency” (our slogan from back in 2000). Bitcoin seems to have created a new currency (at least on the level of speculation), but the payment system is badly lacking.
    I will become more bullish on Bitcoin when I see the payment volume of Bitcoin really increase.
  • What is your view on Neoreaction? Sounds like a self-contradiction — if you’re reactionary, why do you need the “neo?”
  • I think there’s been a Gresham’s Law in science funding in this country, as the political people who are nimble in the art of writing government grants have gradually displaced the eccentric and idiosyncratic people who typically make the best scientists. The eccentric university professor is a species that is going extinct fast.
  • If our great expectations about the future are not realized, then we need to save way more than we are doing today. China (with 40% savings) is perhaps more “rational” than the US (with about 0% savings), at least in a world of general stagnation.
  • Sociopathic investor behavior that worked shockingly well in the 1980s and 90s will work much less well in today’s more transparent and founder-centric world.
    As an investor, I think one must always maintain a certain amount of humility. There is only so much we can do to help the companies in which we invest. And because of this, the act of making the investment (rather than the ability to fix things later) remains by far the most important thing we do.
  • A sense of mission is critical, but I think the word “social” is problematically ambiguous: it can mean either (1) good for society, or (2) seen as good by society.
    In the second meaning, it leads to me-too copycat companies. I think the field of social entrepreneurship is replete with these, and that this is one of the reasons these businesses have not been that successful to date.
  • Biggest mistake ever was not to do the Series B round at Facebook.
    General lesson: Whenever a tech startup has a strong up round led by a top tier investor (Accel counts), it is generally still undervalued. The steeper the up round, the greater the undervaluation.
  • Yes, I think [Henry] George is a really interesting thinker. The idea that we should tax land heavily (and perhaps not tax anything else at all) is very interesting, since many of the bad monopolies in our society involve the unholy coalition of urban slumlords and pseudo-environmentalists.
  • I think Andreessen is half-right: Snowden is both a hero and a traitor.
    It is really unfortunate that there were no internal checks in our system, and so it took something like Snowden breaking all the rules for us to have a serious discussion about the NSA.
  • Even when one understands that exponential growth and exponential forces are incredibly important, it is still hard to internalize this. PayPal was growing at 7%/day at the time of the launch (Oct 99-Apr 2000, from 24 users to 1 million), and we did not fully fathom the rocket we were riding.
  • I do not find myself fully on the side of any of our political leaders — because none of them are fully on my side.

Minerva Project Business Plan

Tuesday, September 9th, 2014

The Minerva Project has an unusual business plan:

To seed this first class with talent, Minerva gave every admitted student a full-tuition scholarship of $10,000 a year for four years, plus free housing in San Francisco for the first year. Next year’s class is expected to have 200 to 300 students, and Minerva hopes future classes will double in size roughly every year for a few years after that.

Those future students will pay about $28,000 a year, including room and board, a $30,000 savings over the sticker price of many of the schools — the Ivies, plus other hyperselective colleges like Pomona and Williams — with which Minerva hopes to compete. (Most American students at these colleges do not pay full price, of course; Minerva will offer financial aid and target middle-class students whose bills at the other schools would still be tens of thousands of dollars more per year.) If Minerva grows to 2,500 students a class, that would mean an annual revenue of up to $280 million. A partnership with the Keck Graduate Institute in Claremont, California, allowed Minerva to fast-track its accreditation, and its advisory board has included Larry Summers, the former U.S. Treasury secretary and Harvard president, and Bob Kerrey, the former Democratic senator from Nebraska, who also served as the president of the New School, in New York City.

Nelson’s long-term goal for Minerva is to radically remake one of the most sclerotic sectors of the U.S. economy, one so shielded from the need for improvement that its biggest innovation in the past 30 years has been to double its costs and hire more administrators at higher salaries.

[...]

Minerva is built to make money, but Nelson insists that its motives will align with student interests. As evidence, Nelson points to the fact that the school will eschew all federal funding, to which he attributes much of the runaway cost of universities. The compliance cost of taking federal financial aid is about $1,000 per student—a tenth of Minerva’s tuition—and the aid wouldn’t be of any use to the majority of Minerva’s students, who will likely come from overseas.

Subsidies, Nelson says, encourage universities to enroll even students who aren’t likely to thrive, and to raise tuition, since federal money is pegged to costs. These effects pervade higher education, he says, but they have nothing to do with teaching students. He believes Minerva would end up hungering after federal money, too, if it ever allowed itself to be tempted. Instead, like Ulysses, it will tie itself to the mast and work with private-sector funding only. “If you put a drug”—federal funds—“into a system, the system changes itself to fit the drug. If [Minerva] took money from the government, in 20 years we’d be majority American, with substantially higher tuition. And as much as you try to create barriers, if you don’t structure it to be mission-oriented, that’s the way it will evolve.”

Peter Thiel’s Contrarian Strategy

Friday, September 5th, 2014

Roger Parloff of Fortune describes Peter Thiel:

A gifted rhetorician and provocateur with a bottomless pocketbook, Thiel has drawn upon his wide-ranging and idiosyncratic readings in philosophy, history, economics, anthropology, and culture to become perhaps America’s leading public intellectual today, assuming a mantle once held by the likes of Thorstein Veblen or Norman Mailer. The conspicuous difference is that Thiel—a libertarian, gay Christian—espouses views that are far harder to anticipate, and he has earned his pulpit largely through commercial rather than literary or scholarly masterworks.

Flatley’s Law

Friday, August 29th, 2014

Over the past 13 years, the cost of sequencing DNA has dropped from $100 million per human genome to only $1,000:

The only thing more extraordinary than the growth rate of the sequencing revolution is that the beneficiary is a single company, Illumina of San Diego, and most of the credit for the rate of change can be laid at the feet of one entrepreneur, Chief Executive Jay Flatley. Thanks largely to Flatley’s leadership, Illumina emerged as the dominant maker of DNA sequencers eight years ago and has maintained 80% market share despite an assault by several well-funded competitors.

Since 2008 Illumina’s sales and profit have both increased 147%, to $1.42 billion and $125 million, respectively, as the stock increased 617% and the company’s market capitalization reached $23 billion.