Capitalogix

Capitalogix's 23rd Anniversary

Last week I started getting “Happy Work Anniversary!” messages on LinkedIn ... and I was a bit confused because people kept mentioning 23 years. 

Twenty-three years ... That can’t be right? Can it?

For context, here’s what I looked like around that time.

 

My eldest son (who’s now married with a baby) was in middle school. I was just out of the events I described in my TEDx talk. 

However, depending on your definition, the 23rd anniversary can be true or false. Legally, the Capitalogix that exists today is distinct from the initial iteration. Additionally, the company has expanded, its direction has shifted, and what was once a one-person operation has grown into a team of over 20 individuals focused on advancing and commercializing the field of Artificial Intelligence.

It reminds me of the Ship of Theseus (also known as Theseus’ Paradox), which is a philosophical thought experiment that poses the question of whether an object that has had all of its parts replaced is still considered to be the same object. It raises issues of identity, continuity, and change over time. The concept can be applied to physical objects, living organisms, and even organizations or businesses. It challenges our understanding of what it means for something to be fundamentally the same, and if an object can remain unchanged despite undergoing significant changes over time.

The name “Capitalogix” did originate in the year 2000 ... and a surprising amount of the original North Star “purpose” still exists. Honestly, I’m surprised by how much holds up despite 20+ years of passing ... but almost all of it has needed some course correction to adjust to changing tides.  

Regardless, it’s staggering to think about how long I’ve worked in A.I. (since 1991, when it was hard to spell A.I.) and how far we’ve come. 

If I had known how difficult it was at the beginning, I probably never would have pursued it. However, knowing how difficult it is, and how challenging it is to make meaningful progress, I feel better that I did because I realize that it’s not just a competitive advantage, it’s a sustainable competitive advantage. It’s easy for people to focus on a capability, it’s another to make it industrial-grade, robust, reliable, and able to work in difficult conditions. They say that things that don’t kill you make you stronger, it’s true for people, but it’s also true for technologies.  

As we celebrate Chinese New Year, it also feels like a new beginning for Capitalogix as we chase after new possibilities and probabilities. 

We didn’t come this far — just to come this far! Onwards!

Happy Chinese New Year!

Chinese New Year happened this weekend.

So, Gong Xi Fa Cai … which translates to "Best wishes for a prosperous New Year!"

Often, Jennifer and I go to Indonesia to celebrate with Jen's family, but this time we stayed home and celebrated here. 

via Statista

On New Year's it is a lot easier to celebrate when you have a party to go to ... The trick is finding the celebration in the first place.

It's interesting to think about how many New Year celebrations there are.  In addition to Chinese New Year, Muslims have Hari Raya Idul Fitri; Jews have Rosh Hashanah; of course, there is January 1st (and many others).

Which is correct?  I think the answer is all of them.  Regardless of your chosen New Year, it provides an opportunity to celebrate, share, reflect, plan, and commit to the right actions.  If you've already fallen off the wagon of your new year's resolutions, this can be your reason to get back on them. 

As I think about it, the same principle applies to trading.  It's all a matter of perspective.

At some level, there really isn't a correct answer as to which trading style is best.  The best technique is the one that works.  Trading styles go in and out of phase, and if you get too attached to a particular technique, you can too easily get detached from profit.  As any experienced trader can tell you, edges decay, people catch on, and trends change.

As businesses increasingly adopt Artificial Intelligence, the way forward is becoming evident.  This involves utilizing AI to selectively activate and deactivate specific capabilities based on their effectiveness.

In trading or business, while no single method is guaranteed to succeed, there is always a method that can be effective.  You just have to be flexible enough to know what you want and still be willing to accept something better.

The World's Biggest Hedge Funds

Hedge Funds have seen a downtick since COVID-19. There are still 15,000 of them (amounting to $4.5 Trillion in assets under management).

Seventy percent of Hedge Funds are North American. 

Visualcapitalist put together a guide to the 20 biggest funds. It puts the consolidation of wealth into perspective. 

via visualcapitalist

Unsurprisingly, Bridgewater tops the list by a wide margin with nearly double the assets of their closest competitor. And, despite poor performance by many funds, the overall state of the market means that many funds still saw growth. 

The expansion of hedge funds may not always align with general market trends – and is not necessarily a reflection of the overall economic situation. However, studying and evaluating their growth and results can still be beneficial. 

AI Tools For Your Business

Last week, I talked about the time value of time - and the benefit of quality peer groups. 

On Friday, one of those peer groups spent hours talking about the promise and peril of generative AI. While some people remained skeptical or in fear of what tools like ChatGPT made possible. 

One of the members shared an AI tool directory that I thought was worth sharing as well. It's called Futurepedia.io 

via futurepedia.io

My contribution to the discussion was brief, but it amounts to this ... Nothing you're hearing about AI should scare you. It should scream opportunity.  You don't have to rush.  AI is at the beginning of a long upwards sloping cycle of impact and capability. However, AI isn't duct tape, and for most, it's not a business ... it's a tool to help you create a bigger future that wasn't possible before.  Much like "internet" companies came and went in the late 1990s ... yet almost every company uses the internet in ways that were unimaginable at the beginning of the cycle.

People often get stuck searching for 'something' (often a singular goal or result). But, in their myopia, they miss the possibility of 'or something better.' 

In my business, I'm rarely happy to settle for less than I'm aiming for ... but I am willing to happily take the 'or something better'. Nonetheless, it is hard to see (let alone be open to) other targets or possibilities when you myopically focus on achieving the lesser (but specific) goal or target you initially chose to focus upon.

So, here is a thought to ponder ...

What is opportunity, and when does it knock? It never knocks. You can wait a whole lifetime, listening, hoping, and you will hear no knocking. None at all. You are opportunity, and you must knock on the door leading to your destiny. You prepare yourself to recognize opportunity, to pursue and seize opportunity as you develop the strength of your personality, and build a self-image with which you are able to live -- with your self-respect alive and growing. ~ Maxwell Maltz

Imagine what you believe this tipping point indicates is possible personally and professionally.

Hope that helps. 

On The Time Value Of Time

I have always believed that you can predict a lot about your future based on the quality of the people you spend the present with.

That is why I think participation in quality peer groups is critical. 

Over the years, I joined several business-leader peer groups like Strategic Coach,  Abundance 360, and Genius Network.  These groups are a great way to meet people and learn things ... and they also provide you with access to the benefits of feedback from a group of trusted advisors, perspectives you might otherwise get from a counselor, and a flow of ideas and opportunities that wouldn't have crossed your mind or your desk.  They allow participants to see, hear, and discuss things they don't usually think about, talk about, or even notice.

Peer groups are also great at bringing blind spots to your attention and connecting you to trends transforming industries and the world.

In these meetings, you often find a "nugget" in the discussion.  Sometimes it stems from what is happening in the world.  Sometimes it alerts you to potentially valuable relationships, opportunities, or gadgets.  And sometimes, the nugget comes from discussing a common problem or constraint (like the pandemic) with your peers. 

This week, several of these groups prompted me to think about time (e.g., not wanting to sell time for money, wanting to live past 100, the "strangeness" of time during the past year, etc.). 

Time is funny.  Sometimes it seems to fly by ... other times, it seems to stand still.  Dan Sullivan uses the example of 10 minutes with a dying loved one compared to holding your hand on a stove for 10 minutes.  One seems excruciatingly short, and the other seems excruciatingly long. 

zefrank via YouTube

The average life expectancy for men in the U.S. is 76.

How many amazing vacations do you have left?  How many jaw-dropping moments?  How many fantastic meals?  How many Super Bowls?

What about time with your parents or older relatives?  It's easy to forget to call or miss an important event because "life happens" – but if you realize you may have already used 95% of your in-person time with that person ... doesn't it become more special?

For contrast:

• Would you rather spend that time dwelling on a mistake?
• What about being angry at something out of your control?
• What about doing work that drains you mentally and emotionally?

In my TEDx talk, I mentioned "living like you only have a year left" and how much more "life" we got out of the last part of my dad's life. 

That is just an example, but clearly, it is worth taking the concept further. 

To start, think of some of the activities you do, places you go, experiences you have that are special and make you feel like your best self. 

• Hitting Flow-state and creating something new and exciting;
• Taking an amazing vacation and experiencing something completely new;
• Having a moment with someone you love that makes you stop and say - "Wow!"
• Making a difference in someone's day or giving back to your community;
• Experiencing peace and relaxation;
• Feeling pure joy.

It's easy to get lost and take these moments for granted when they happen, but when you think about how much time you have left ... they take a whole new meaning. 

How can you maximize the time you have left?  Fill it with the best experiences, activities, and people you can.

To start, think about different time frames:

• What activities could you commit to doing at least once a year?
• What activities could you commit to doing at least once a month?
• What activities could you commit to doing at least once a week?
• What activities could you commit to doing at least once a day?

 Make those lists ... it is a simple way to get a better return on the time value of your life.

Seriously, try it.  

Let me know how it worked for you – and what you chose! 

 

 

How'd These 2022 Predictions Fair?

As we brought in 2022, I asked the question:

What's going to happen as a result of the continuing pandemic, inflation, interest rates, the ongoing supply chain issues, and the growing anxiety and unrest brewing underneath the surface of the new normal? In January, we'll get to see VC's predictions. Before that, what do you expect to happen in 2022? - How'd These 2021 Predictions Fair?

I proceeded to share visualcapitalist's 2022 predictions: 

via visualcapitalist

Well, there was undoubtedly increased volatility. 

While the whole board isn't correct, there's a surprising amount of prediction accuracy. On some level, predictions benefit from being generally vague. Also, many of the predictions that may not seem as accurate "today" seemed more accurate at some point this year. For example, we heard a lot about NFTs in the first half of the year, and while Big Tech is currently laying off employees, there was massive growth this year. 

What are you surprised they got right? In what areas were the predictions most off-base? Why?

And, of course, what are your mega-trend predictions for 2023?

Interesting stuff! 

Merry Chrismakkuh

Today is Christmas ... and it is also the last night of Chanukah.  So, Merry Christmas and Happy Chanukah!  And Happy Festivus to anyone who doesn't celebrate either. 

For those that don't know, Chanukah is the Jewish festival of lights.  This is the holiday that involves lighting the Menorah (Chanukah candles), eating latkes (potato pancakes), exchanging gifts, playing spin the Dreidel (a gambling game), and enjoying a sense of family togetherness for eight days and nights.

That's a long time, right?!  Well, sometimes it seems even longer with my family. 

To help you stay in the right mood, here is a video of "The Chanukah Song," performed by comedian Adam Sandler on Saturday Night Live.  It became an instant classic (and he has since released a second, third, and fourth version.)

Here is the video.  And, if you're feeling left out - here's Adam Sandler's Christmas Song.

The cynic in me believes merchants invented the gift part of the holiday.

Regardless, the Capitalogix team has been festive, and the office has been filled with holiday cheer.  Here is a picture that some of the team took after our ugly sweater contest.

I hope you're having a wonderful celebration surrounded by people you love and food that would make your cardiologist feel safe buying a new Porche.

OpenAI's ChatGPT is Pretty Cool

One of my go to claims about AI is that it can do almost anything ... but it can't do everything. Specific AI systems are becoming incredibly robust. Last year, I wrote an article emphasizing how big of a jump GPT-3 was from past language processors.  I also shared a Seinfeld sketch created by GPT-3 that was so good it was almost unimpressive ... it just felt like a Seinfeld sketch. 

It feels like every week, there's a new breakthrough in pop AI. OpenAI just released ChatGPT (for free) to the public. The promise of ChatGPT is to give a cogent reply to conversational discussions. It can help you code, it can write a poem, can answer your questions, and more. The code it produces is stellar, and it can even create a convincing romantic comedy using characters from various famous shows. It does a lot very well, but it does have some failings. 

ChatGPT via OpenAI

 

GPT-3 is 100x bigger than any previous language AI model and comes pre-trained on 45TB of training text (499 billion words). It cost at least 4.6 million US dollars (some estimated as high as $12 million) to train on GPUs. The resulting model has 175 billion parameters. This was impressive enough, but ChatGPT is actually not based on GPT-3 but GPT3.5 an even more robust model that improved on the ability to answer in a way that feels natural. 

ChatGPT can talk about almost any topic you can think of, and even create prose that feels human; however, it's not perfect yet. 

Unfortunately, this chatbot fails in many of the same ways as its predecessors. To start, it can present false information as true because it's essentially a "stochastic parrot" basing its answers on statistical regularities in its data sources, not on an actual understanding of the world. As well, a lot of its answers can include meaningless fluff that sounds good but doesn't actually answer the question meaningfully ... almost like a high schooler that forgot to read the book before writing an essay. It also can't produce ASCII art despite the advancements in AI art we've recently discussed. 

Regardless of ChatGPTs faults, it's a very impressive piece of software. It can answer trivia like Google, write poetry and dialogue, it can pretend to engage in philosophic discussion, and it can help you correct your code or improve your writing. 

Here's a sonnet I had it write about Artificial Intelligence:

AI, the future's shining light,
A force that shapes our world anew,
A source of endless possibility,
A tool that cuts our burdens in two.

From language translation to deep learning,
AI's capabilities are vast and grand,
It helps us solve problems, find solutions,
And gives us new ways to understand.

But with great power comes great responsibility,
As AI transforms our world and lives,
We must ensure that it's used ethically,
That it helps, rather than subverts or deprives.

So let us embrace this technological marvel,
And use it wisely, for the common good,
For AI has the power to unravel
Our deepest mysteries, as well as hurdles.

 

It does what it is supposed to do very well. It is much more conversational and robust than previous chatbots. Obviously, it doesn't do everything well, and I doubt a chatbot will any time soon. Nonetheless, it is a step forward … and it will create ripples of progress.

What do you think?

Tech Company Layoffs

For all the drama at Twitter, they're not the only ones experiencing layoffs in the tech industry. Though, Elon is now (supposedly) trying to renege on his severance packages.  

via visualcapitalist

Meta and Amazon saw even steeper layoffs than Twitter. Is this a result of overhiring during the tech boom, or a sign of dire times? Time will tell.  

Stated reasons are economic uncertainty and poor performance, we're also seeing unsuccessful departments downsize - like Alexa. 

To help allay economic fears, payroll and wage data from the U.S. government are exceeding expectations, and the country’s unemployment rate is close to a half-century low. As well, tech jobs account for 3% of the workforce - and many of those laid off will be picked up by smaller companies. 

Even if the layoffs represent a short term reaction to what tech companies are seeing, hearing, or otherwise experiencing … they won't necessarily translate to long term bad news for our economy. 

The Rise of the Intangible

In the past, most profitable companies built or sold some sort of tangible product. The Titans of industry were automobile manufacturers, oil producers, land owners, etc.

Over the past 20 years, the Titans have changed dramatically. Now, the leaders are in tech, IP, and other intangible assets. Here is a chart showing the changing weight of tangible and intangible assets as part of the S&P 500’s total assets between 1975 and 2020.

 

 via visualcapitalist

By VisualCapitalist’s definition, intangible assets are holdings that don’t carry any physical or financial embodiment. This includes R&D, intellectual property, and computerized information such as data and software. Today, intangibles are worth over $21 trillion.

With technology becoming more ubiquitous, I think the trend will continue - which makes protecting your intangibles even more important. 

Patents and trademarks are a great way to build a moat between you and your competitors. Remember, however, that anything you get a patent on becomes public knowledge - so be careful with your trade secrets.