Capitalogix

The Twelve Days of Christmas ...

Most people know the song about the 12 Days of Christmas, but here's an interesting visualization of what presents were gifted by "their true love." 

via Neil R Kaye

 

I don't know about you ... but that's a ton of birds. Probably too many. Forty gold rings doesn't sound too bad (and less likely to become worthless than the NFTs they thought about substituting here). 

All together pretty noisy. 

Hopefully, you bought presents that your partner would actually enjoy. 

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. 

Envisioning A Bigger Future

Last week, I shared an article about creating your annual plan (and how Capitalogix does it).  This week, I want to talk more high-level about how we create a bigger future for ourselves, and next week I’ll talk about how I translate that bigger future into resolutions and actions. 

The beginning of a new year is an excellent time for a fresh start.  While it’s always the right time to take the right action, the structure of a year-end is a helpful crutch and force function. 

We look forward to what we will achieve – even though history says we rarely achieve everything we hope for.  Meanwhile, paradoxically, it is also true that we rarely achieve things we don’t hope for.  So, Hope!  It may not be a reliable strategy ... but it beats the alternative.

I’m excited about 2023.  Despite the abnormal market, the crazy headlines, and the still volatile political climate, we’re moving toward increased stability. 

Even though I expect some volatility, we have become more accustomed to handling it (and we’ve become better at transforming its strategic byproducts into strategic benefits).

On a different topic, think about how much progress we’ve made and how different the “new normal” has become.  For example, think about Zoom and remote work or how quickly our economy migrated online.  On many levels, what we are doing now seemed like science fiction, even just a few years ago.

We are living in an age of exponential technologies and exponential possibilities.

I commissioned this image from GapingVoid, to remind our team to keep shooting higher.

 

 

Resilience, resourcefulness, and a worthy goal are the foundational keys to many entrepreneurial success stories.

In the spirit of New Year’s Resolutions – I’ll add that a deliberate approach to goals is important too.

I’m a big fan of picking a Big Hairy Audacious Goal (sometimes called a “BHAG”) and taking actions that move you in that direction. 

I’m also a big fan of Strategic Coach’s Bigger Future exercise.  It is a 25-year planning exercise where you lay out your commitments and goals to yourself, your family, your career, and your legacy.  One of the keys to this is chunking high enough to name the roles, goals, and strategies you select with timeless language (meaning that the target words hold up even as you pivot and adjust your focus and actions).

While doing this, I realized that my ideal next chunk of years involves taking Capitalogix to the next level (and beyond) through collaboration, cooperation, and joint ventures. 

Once you know your long-term goal, it is relatively easy to plan the steps you need to achieve it.  Achieving smaller goals reinforces successes, builds momentum, and makes continued progress feel more likely.

Extra points if you make them SMARTs (Specific, Measurable, Attainable, Realistic, and Time-Bound). 

Actions speak louder than words, and your words can distract you. 

If your goal is to win first place at a competition, focus on the metrics of a first-place finish instead of the medal.  This makes the goal concrete and sets an internal locus of control for your victory.  This also means you don’t need to tell others about your goal too soon.  Studies show that when you announce your intention to achieve a goal in public, you decrease the likelihood of succeeding. 

It’s okay to misstep, and it’s okay to get stuck - but recognize where you are and what you’ve done ... and move forward. 

Delayed gratification happens when you want something badly, but are not able to get it right away.  The result is often anger or frustration.

Meanwhile, the mainstream media broadcasts a seemingly non-stop stream of messages screaming for immediate attention and gratification.  The result of that is not good either (for example, it can result in higher rates of obesity, drug abuse, and depression). 

Don’t be fooled.  Overnight successes are rarely actually overnight successes (for long).

It’s also important (once you’ve accomplished your goal) to set new goals. 

Over the next 25 years, there are many people I want to impact – and many goals I want to accomplish.

It hasn’t always been easy - but building Capitalogix has been an intensely rewarding passion.  It has been easier because I want what I want.  Make sure you know what you really want ... it makes getting it much easier.

I look forward to you all being a part of it as well.  Here’s to a successful 2023 and an even more successful 2048.  

Onwards!

Another AI Art Gimmick

There's a new trend of AI-generated profile pictures - using tools like avatar.ai.

Below are some sample results my son, Zach, got after downloading an iPhone app called Lensa.  The company that makes it also offers a product called Prisma that is worth looking at as well.  He paid $4 within Lensa to generate these AI photos (for context, avatar.ai charges more than 5x as much).  He uploaded 17 photos from different angles (and with different expressions), and the app promised 50 pieces from 4 styles.

What do you think of the results?  I thought some of them were surprisingly good. 

 

Some were not so good ... (or at least outside my zone of artistic preferences).

After seeing his, I'll admit I got curious and made my own. 

 

To be honest, these apps are still volatile ... meaning, sometimes they are good enough to seriously impress – but they also can underwhelm from time to time.  Check out DALL-E for more examples of the dynamic range of possibilities and results.

Regardless, I am impressed with AI art's progress and momentum.  Recently, generative AI has gotten a lot of hate (along with the hype), nonetheless, people are talking about it (meanwhile AI art is still not as polarizing as Kanye). 

The reality is, most of these tools still are an elegant use of brute force.  Nonetheless, I am bullish.  Hardware and software are getting better ... and when fed more data, generative art depictions get better as well. 

The uses continue to get more elegant and complex as time passes ... but we're still coding the elegance. 

For more on this topic: 

• Dall-E and AI-Generated Art 
• AI editing underwater photography
• AI evaluates how normal your face is
• On deepfakes and fake news
• Bruce Willis and AI movie characters

Creating Your Annual Plan

It is that time of year, again.  We are in the midst of our annual planning for 2023.

The process is relatively straightforward.  We start by deciding what the company's three highest priority goals are. With those goals as the base, each department (and manager) creates a big three that represents what they can do to reach the company's big three. From there we dive into quarterly rocks, SMARTs (goals that are specific, measurable, actionable, relevant, and timed), as well as the explicit tactical steps it will take to accomplish what we set out to achieve. 

The meetings are going well.  There is a lot of back-and-forth idea sharing, negotiating, and priority setting.

Nonetheless, I had a sneaking suspicion that sometimes what seemed like a dialogue, was really multiple monologues. 

The reason for the disconnect (or misconnect) was that the participants had fundamental beliefs, at a higher level than we were discussing, that were at odds with each other. 

I shot two videos that I think help teams get to alignment.

Thinking About Your Thinking

The first discusses several techniques to enhance your decision-making. 

 

One of the ideas is something called "Think, Feel, Know." Basically, it explains that you have to deal with superficial thoughts before getting to deeper feelings. Then, you have to deal with those feelings before you get to "knowing". 

Another technique discussed in the video involves adding time to look for "insights" after working on something.  Those insights are often the seeds for something greater.

Chunking Higher

The second is on how to chunk high enough that you can start from a place of agreement.  Exploring distinctions from there is relatively easy.

I'll add one more concept for good measure ... Start with the end in mind. Alignment happens in stages.  Before you can truly get alignment on what to do next, you have to get agreement and alignment about where you are and where you want to go.

With that said, another important component of meaningful communication is a shared understanding of a common language.  Words can mean different things to different people.  Simply agreeing on a "word" is different than agreeing on a common meaning.

To summarize these concepts:

1. Make sure you have a common language
2. Begin with the end in mind
3. Start with the highest level of agreement
4. Make distinctions from there

Hope that helps. 

Happy Thanksgiving 2022!

I hope you all had a Happy Thanksgiving! 

This year, we continued our tradition of going to the Cowboys game – then having a big dinner together afterward.

I got to spend time with both my sons and my first grandchild (who didn’t seem to want her picture taken while there was so many other things to investigate).

 

 

Thanksgiving is a reminder to be grateful for the blessings in your life - big and small. But it's also a time to be thankful for the challenges in your life - and the opportunities for growth.

Often, when I think about what I want, the first thing I think of is what I don't want. Similarly, when I think about what's going well (or something worthy of being thankful for), I first think about what has been difficult or isn't above minimum standards yet.  Some things change quickly.  Apparently, human nature isn't one of them.

Challenges are often hidden gold mines. Instead of thinking about them being obstacles for you, recognize that getting past them creates an obstacle for competitors. In other words, figuring out a strategy to achieve these lofty goals creates a new status quo and a sustainable competitive advantage.

At Capitalogix, we often talk about "finding a way," "creating breakthroughs," and "setting new standards."  The reason is that most things an innovator wants are just outside their current capabilities (otherwise, they'd already have them).  

Dealing with this on a daily basis requires a resilient mindset and the ability to be comfortable with being uncomfortable. 

Having no problems either means you're blind to your flaws or aren't playing a big enough game (which is a problem in itself). 

So, I am thankful for my health, my family and friends, and the quality of my life. But, I am also thankful for the stress, the challenges, and the opportunity to face a continually better class of challenges that forge a path to a bigger future.

Happy Thanksgiving!

What's The Dollar Milkshake Theory?

Right now, the US Dollar is outperforming other currencies - in part, because it's the Reserve Currency.

via Econofact

But, that's not necessarily a good thing.

One possible occurrence of this is called the Dollar Milkshake Theory.

It purports that the US dollar will suck up liquidity from the other currencies, creating a chain of events that will drive the US dollar even higher. Unfortunately, this increases the risk of debt defaults. Eventually, the dollar ends up drinking the liquidity from the entire world economy.

Think about it. If you're getting negative yields on your two-year bonds from other countries, after a certain point you would sell those investments and switch to US two-year treasury bonds. It's a slippery slope from there. 

If this is true, then it also has dangerous implications for crypto - which is already in peril after the FTX controversy. 

So, the question becomes, does the dollar's strength truly help us? What about the global economy? What do you think?