Spotlight

The company WeWork has been in the recent news for a lot of reasons — many of them not so comforting for the company’s private investors. Those who haven’t heard of WeWork or don’t know much about it, here’s a primer on Wework’s business model.

In one line, WeWork leases out large office spaces, upgrades them, makes them look cool and upscale, and rents them out on per seat basis to either individuals or other companies. In case you’ve heard of the term coworking spaces, WeWork is that.
[Read more…] about Of Good Stories and Bad Businesses

An old joke — What’s common between a software engineer and a railway station beggar? When they meet their colleagues, they ask each other, “What platform do you work on?”

I am yet to learn about the begging business but having worked in the IT industry as a software developer for more than a decade, the joke did manage to extract a brief mirth from me.

Just like any other field of work, software engineering too has its own compartments of specialization. So when a software guy enquires about his fellow engineer’s platform, it generally means he’s interested to know about his specialization — Linux or Windows? Which programming language? Application side or system side? Backend or front end? Development or 0perations? Etc.

However, in the past few years, a new specialization has emerged — the full-stack engineer. Paradoxically, this specialization is about being a generalist, i.e, an engineer who can work on multiple platforms, different programming languages, and play various roles.
[Read more…] about The Full-Stack Investor

Have you ever noticed that finding an available spot in the multilevel car parking in any mall or shopping complex is an interesting exercise in mental maths? Let me explain.

Whenever I enter the parking area, I often try to optimize, i.e., find a spot near the lift lobby/staircase. Which means the moment I enter the parking area, I have to forego the easily available spots and keep driving towards the lift lobby and then hope that there’s a spot available near it. If there isn’t, then I would have to drive up to the next floor, which is kind of worse than the case where I would have taken the first few available spots near the parking entrance. So how many first available spots should I pass before I decide to stop searching?

It turns out that mathematicians have spent centuries thinking about this class of problems. They call it The Optimal Stopping problem.
[Read more…] about Picking Stocks Like a Mathematician

In 1999 when Warren Buffett bought a 75% stake in MidAmerican Energy Holdings Company, David Sokol was its CEO. He retained his position till 2008. Apart from managing MidAmerican, Sokol played a crucial role in turning around Berkshire’s other investments like NetJets and Johns Manville. Over the years he established a reputation inside Berkshire Hathaway as Mr. Fixit.

In his annual letters, Buffett often referred to Sokol as a terrific manager, a brilliant dealmaker and a huge asset to Berkshire. In his 2008 letter, he wrote —
[Read more…] about It’s Not Supposed to Be Fair

On December 24, 2014, AirAsia Flight 8501 took off from Surabaya (Indonesia) at 5.30 am local time. With 155 passengers and 7 crew members onboard, the flight was headed to Singapore. About 43 minutes into its flight, the Airbus A320 disappeared from the radar. The worst had come to pass. Two days later, the rescue team discovered the plane wreckage in Java sea. All 162 people onboard perished in the crash.

The crash investigation revealed that it was a pilot error. The in command Captain Iriyanto — a 53-year old former Indonesian Air Force pilot — performed a non-standard reset of the onboard flight control computers. Which means he did something which was not mentioned anywhere in any of the operating manuals. Why would someone with an experience of more than 20,000 flight hours do such a thing?
[Read more…] about The Risk of Worrying About the Non-Risk