Michael Burry's Wrong, How Long do Startups Take to Succeed, Pondering | 2.47

"I've learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel." - Maya Angelou

News and Numbers

Markets this Week:

• S&P 500 is up 3%

• NASDAQ 100 is up 3%

• Bitcoin-USD is up 5%

• Ethereum-USD is up 6%
   

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Finance

By Vlad Estoup, B.Comm. (Finance), working in Ethereum cybersecurity

A Broken Clock.

Michael Burry, the famed investor and hedge fund manager, gained widespread recognition after he successfully predicted the 2008 housing market crash, earning his investors billions of dollars in returns. However, in recent years, he has been making headlines for a different reason - his missed opportunity to capitalize on the stock market's gains.

Burry is a prime example of how missing just a few of the best days in the stock market can significantly impact your long-term returns. Despite being known for his shrewd investment strategies, Burry failed to fully capitalize on the market's historic bull run in the years following the 2008 crash.

One of the key reasons for this was Burry's decision to hold a significant amount of cash in his portfolio, believing that the market was overvalued and due for a correction. While this may have been a sound strategy in theory, the reality was that Burry missed out on some of the market's biggest gains during this period.

According to a study conducted by J.P. Morgan Asset Management, missing just the 10 best days in the stock market between 2000 and 2020 would have resulted in an average annual return of 2.6%, compared to a return of 6.0% for investors who remained fully invested during this period. This highlights just how much of an impact missing out on a few key days can have on your long-term returns.

Of course, it's worth noting that attempting to time the market is a risky strategy that's difficult to execute successfully. While Burry may have missed out on some gains, his decision to hold cash during a volatile market environment also helped protect his portfolio from significant losses. However, the lesson to be learned here is that even the most seasoned investors can make mistakes and that missing out on just a few of the market's best days can have a significant impact on your overall returns.

So, what can investors do to avoid making the same mistake as Burry? The answer is simple - remain invested for the long term. While there will inevitably be periods of market volatility and downturns, history has shown that over the long term, the stock market has delivered strong returns for investors who remain patient and hold a diversified portfolio of stocks.

In conclusion, Michael Burry is a cautionary tale of the dangers of trying to time the market and missing out on some of its best days. Investors would be wise to learn from his mistakes and remain invested for the long term, rather than attempting to make short-term predictions about market movements. By doing so, they can give themselves the best chance of achieving their financial goals and building long-term wealth.

This is not financial advice and you should always do your own research before investing in any securities or cryptocurrencies.

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Sci-Tech

By Keyann Al-Kheder, Software Engineer

How long do startups take to succeed?

Understanding the timeline of a startup's success is crucial in making informed decisions, whether it's investing or launching a new venture.

In this week’s article, we explore the average length of successful startups, taking into account notable examples and the factors that contribute to their success.

When analyzing the lifespan of successful startups, it's important to remember that there isn't a one-size-fits-all approach. Success can take various forms, including unicorn status ($1B valuation), acquisition, Initial Public Offering (IPO), or steady profitability.

As a result, the average time it takes for a startup to reach success varies from company to company, as well as just your definition of startup ‘success’.

1. OpenAI - Founded in 2015, OpenAI experienced rapid growth in the artificial intelligence field, reaching a valuation of $29 billion within just seven years.

2. Epic Games - Established in 1991, Epic Games experienced varying levels of success before hitting it big with Fortnite in 2017. It took the company approximately 26 years to become a gaming industry giant, with an estimated worth of over $28 billion as of 2021.

3. Airbnb - Launched in 2008, Airbnb disrupted the hospitality industry and achieved a $1 billion valuation in only four years. It went public in 2020, with a market capitalization of over $100 billion.

4. Uber - Established in 2009, Uber became a transportation giant in a short period, reaching a $1 billion valuation within five years. The company went public in 2019 and continues to expand its services globally.

5. Slack - Founded in 2009, the team collaboration tool saw rapid growth, achieving a $1 billion valuation in just five years. In 2019, Slack went public through a direct listing, further demonstrating its success.

6. Zoom - Launched in 2011, Zoom's video conferencing platform gained popularity quickly, reaching a $1 billion valuation in only six years. The company went public in 2019, and its market capitalization skyrocketed during the COVID-19 pandemic.

7. Stripe - Founded in 2010 by brothers Patrick and John Collison, Stripe quickly became a dominant player in the online payments space. By 2021, just eleven years after its inception, the company had achieved a valuation of over $95 billion.

While there is no definitive answer to the average lifespan of successful startups, these examples demonstrate that they all vary significantly and they all take at least a few years, but most never achieve overnight success.

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Some things to Ponder

By Roman

The above WSJ-NORC poll of 1,019 adults between March 1 - 13, 2023 (margin of error +/- 4.1%) found that values such as patriotism, religion, having children, and community involvement are receding in relation to survey results from 1998 and 2019. Additionally, the perception of the value of money has increased over the same period. 

Below is my hypothesis for each change in perception. 

Opinion: Patriotism

“Patriotism” has decreased on the above graph because of the rise of globalization: 

• People are more mobile; they can live in multiple countries throughout their life. 

• More people from different ethnic origins are having children together.

Opinion: Religion

“Religion” has decreased on the above graph because of the busyness of life:

• More people are too busy for additional commitments like religious activities. 

Opinion: Having Children

“Having children” has decreased on the above graph because of the rising cost of living:

• Purchasing power has steadily decreased due to inflation (e.g., rising housing prices relative to rising salaries).

Opinion: Community Involvement 

“Community Involvement” has decreased on the above graph because of the rise of social media:

• As more and more people use social media, they feel more connected to people through these apps, rather than other community activities.

Opinion: Money

“Money” has increased on the above graph because of the:

• Rise of the Internet; and 

• The rising cost of living.

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(Head)Space

By Vlad

Men Are Natural-Born Leaders

As our society becomes increasingly liberal and politically correct, there has been a push to reject traditional gender roles and the concept of strong masculine men. However, I believe that strong masculine men and conservative values are crucial to the development of a strong society.

One of the main reasons for this is that men who reject the bachelor life and instead focus on building meaningful relationships with women tend to grow the most, earn the most, and live happier lives. This is because they are not distracted by the constant pursuit of short-term pleasure and are able to invest their time and energy into more meaningful pursuits.

Furthermore, strong masculine men are essential for the stability of families and society as a whole. Men who embrace their traditional gender roles as protectors, providers, and leaders within their families create a sense of security and stability that is essential for the healthy development of children.

Unfortunately, our society has been moving away from these traditional values, with the media and government pushing a liberal agenda that seeks to reject gender roles and promote promiscuity. This has led to a breakdown in the family unit, with more and more children being raised in single-parent households, which has been linked to a range of negative outcomes, including poverty, crime, and mental health problems.

Despite this, there is a growing trend among young people, particularly those in their 20s, who feel that conservative values are important and are rejecting the liberal agenda. However, they are often pressured to keep these beliefs to themselves, as the media and government continue to push a liberal agenda and label those who hold conservative values as "bigots" or "backward."

It is time for us to embrace the importance of strong masculine men and traditional gender roles in the development of a strong society. We need to reject the liberal agenda that seeks to undermine these values and instead promote a culture that values family, commitment, and hard work. By doing so, we can create a society that is stronger, more stable, and more prosperous for all.

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Company of the Week

MoonPay is a financial technology company that builds payment infrastructure for crypto. Our on-and-off-ramp suite of products provides a seamless experience for converting between fiat currencies and cryptocurrencies using all major payment methods including debit and credit card, local bank transfers, Apple Pay, Google Pay, and Samsung Pay.

MoonPay is active in more than 160 countries and is trusted by 300+ leading wallets, websites, and applications to accept payments and defeat fraud.

MoonPay is valued at $3.4B and has 5M+ customers.

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Written by: Vlad Estoup, Keyann Al-Kheder, and Roman Kuittinen-Dhaoui