Internet as Public Utility? Bad Policy.

Definitely can't say it better than this HBR editorial: https://hbr.org/2014/11/why-the-public-utility-model-is-the-wrong-approach-for-internet-regulation

I support Net Neutrality, but I oppose those proposals that rely upon classification of the internet as a public utility, and upon government owning and operating the net in the manner of our long-neglected power, water and transportation systems.  That's just a recipe for delay, neglect and death of commercial incentive.

Other progressives feel the same way - check out the Progressive Policy Institute's recent report, Outdated Regulations Will Make Consumers Pay More for Broadband: http://www.progressivepolicy.org/issues/communications/outdated-regulations-will-make-consumers-pay-broadband/

Once again, this is policy that should not be fought / won with sound bites.  

Our economic future depends on wise choices - and sometimes the decision to do NOTHING.

Jeffrey Ruppert

Unsolicited Opinion of the Week: Thankful for Fracking and Fortress America

I'm apparently very opinionated these days.

It's post-Thanksgiving, but today I'm somewhat thankful for the fracking industry, which partially responsible for sub-$70 per barrel oil - which should break the spines of oil revenue dependent and repressive states Russia, Iran, Nigeria and Venezuela.  

According to the IMF, Iran needs $136; Venezuela and Nigeria $120; Russia can manage at $101 a barrel.  

As noted in Bloomberg today:

“If the governments aren’t able to spend to keep the kids off the streets they will go back to the streets, and we could start to see political disruption and upheaval.”

— http://www.businessweek.com/news/2014-11-30/oil-at-40-possible-as-market-transforms-caracas-to-iran

We may see a little instability, but long term, it is worth it.

There may be some disruption in the US among the smaller or highly-leveraged US oil producers, but we can still sustain at this level (just pockets of slowing oil job growth, and so long as the corporate bond market doesn't collapse).

Moreover, as a believer and heavy investor in alternative energy, I don't necessarily see fracking and low oil prices as the enemy.  Alternative energy WILL PLAY an ever-increasing part of our energy future - wind and solar price parity is here (and better when comparing carbon costs).  It's inevitable - attitudes are changing (along with the climate) and the financial models are in place.

Plus, who doesn't like the sound of an energy-independent USA? Fortress America.

Finally, after years of income stagnation for the middle class, its good to see working families get a break SOMEWHERE.

Inspiration here: http://www.businessweek.com/news/2014-11-30/oil-at-40-possible-as-market-transforms-caracas-to-iran

JARUPPERT

Excellent Reminder: The Hidden Benefits of the "Flyover" States

Nice LinkedIn post reminding us of the oft-forgotten benefits of "flyover" states like Ohio, and why it makes sense to call them home in every sense of the word: 

“When I talked to people who live on the coasts about the rent for our office space, they gasp. I’m not joking, in two instances there was a literal jaw drop and audible gasp. Northeast Ohio has one of the lowest costs of living in the US, and that definitely translates to office space as well. We occupy a 5000 sq ft office in downtown Akron, a mix of industrial space and finished office space - which is walking distance to all the downtown restaurants, bars and events. A hiking / biking trail next to our office leads into a National Park 5 miles away. And our monthly rent is less than one third that of a 700 sq ft studio apartment in the Bay Area. We could literally afford 15 thousand square feet of office space for what one person in San Francisco pays to live in a tiny apartment.

Labor rates are lower here as well, but even so our assembly techs are able to make a salary that affords them better housing here than degreed engineers can afford in the Valley.”

— Ken Burns - President, TinyCircuits

Read the whole article: Why our Tech Startup is Based in Akron, Ohio.  

Jeff Ruppert

Excellent Read from A16Z - "Why the Structural Changes to the VC Industry Matter"

Succinct, precise recitation of the changes that are not only affecting the venture capital world, but the startup ecosystem in general.

Moreover, I have not come across a better concise summary of the disruption / reorganization taking place in large segments of our traditional economy, particularly services and retail: 

“[A] ‘death of the middle’ occurs over time as service industries bifurcate into a smaller number of large, fully integrated, full-service institutions on one end and a larger number of smaller, niche-oriented institutions (with a focus on stage, industry, or specialized skillset) on the other.

Look no further than investment banks, law firms, accounting firms, advertising agencies, buyout firms, talent agencies, and recruiting firms to see how this phenomenon has played out in mature services-based business. Interestingly, we are witnessing this right now in a non-services business as well: the U.S. retail market. Long-dominant department stores such as J.C. Penney and Sears are giving way to big-box retailers and etailers (Amazon, Best Buy, Target) at the large end complemented by large numbers of specialty, boutique stores at the smaller end. [Though in retail, betting “narrow” can be big as the internet allows companies to better segment and address previously unaddressed markets.]”

— SCOTT KUPOR, a16z.com

Definitely worth a read and some reflection on your strategies - startup, growth and investing.

Full article here.

by Jeffrey Ruppert

Thoughts Re: Another Excellent Coursera Class - Beyond Silicon Valley: Growing Entrepreneurship in Transitioning Economies

 

 

Just finished another great class from Coursera this AM.

The focus was on the efforts to grow the entrepreneurial ecosystem in NE Ohio and CLE, and the partnerships between private capital, business, government, non-profits and philanthropy to set up and leverage Third Frontier, the Ohio Capital Fund, local accelerators and angel groups.

There is still much to be done, but to date, CLE has moved from ranking dead last (61of 61) for regional entrepreneurial environment in 2002 to a recent 213% improvement in capital funding - moving $259M to NE startups in 2013 and creating hundreds of companies / jobs.

But it is all at risk.  The Ohio Technology Tax Credit has been allowed to expire.  Politicians on both sides of the aisle are questioning public assistance of capital funding mechanisms.  A lack of vision and focus prevails.

But there real jobs at stake - 2500 good paying jobs (including manufacturing) have been created in NE Ohio alone; $30M in annual payroll taxes have been generated.  

Ohio remains a economy in transition, and we are poised to compete - and to reverse the "brain drain" that not only saps us of our state's talented graduates, but also the technology coming out of our state-funded universities.

Silicone Valley and the Research Triangle weren't built overnight - or even in the decade since Ohio founded Third Frontier.  

But ask anyone who visits the startups fighting here in CLE, CBUS and CINCY and they will tell you, with a little continued help, we can put some shine on the Rust Belt.

The Coursera class description can be seen here: https://www.coursera.org/course/entpecon

Jeffrey Ruppert

Recommended Read: Clicking Clean: How Companies are Creating the Green Internet (April 2014)

No matter your views re: Greenpeace, going green or global warming, this is worth a read because sustainable practices help the bottom line.

Clicking Clean: How Companies are Creating the Green Internet (April 2014)

It also helps reminds us that just because we are moving to the "cloud" we haven't stopped killing trees...or our planet.  

Big picture.

Sustainability = good investment strategy.

Jeffrey Ruppert

Bookmark this page: THE FUTURE OF MONEY - DealBook - NYTimes.com

One of the most important bookmarks for investment reading that you can make right now:

NYTimes.com - DealBook - Special Spring Section - THE FUTURE OF MONEY

Not much curation here, but not necessary because the writing / insight is so good.

Highly recommended.

Jeff Ruppert

Thoughts re: Virtu Delays IPO Amid Furor Spurred by Michael Lewis Book

"It earned money from trading on every day but one in the last five years..."

The above statement from the high frequency trading (HFT) firm Virtu's IPO prospectus is alarming.  Read the Bloomberg article about the IPO delay HERE.

Everyone knew (or thought they knew) about the impact that electronic and HF trading was having on the market.  HMV invests directly in field with Motif Investing.  

Michael Lewis' new book Flash Boys only offers some true revelations...mainly the degree to which even the large banks, hedge funds and brokers don't understand how the market now operates.

But it is the combination of those revelations (and the renewed scrutiny that comes with it), combined with such statements above, which truly gives pause.

No one beats the market EVERY DAY (except one) over a five year period without an advantage...the kind that smells funny.

The markets are never going to be an equal playing field.  

But we do not need to institutionalize gray areas of business ethics into perpetual profits for those whose only contribution to society is faster fiber and decreased latency...all at the expense of the larger "free" market.

Jeffrey Ruppert

April 2, 2014

Recommended Viewing: Tesla and SpaceX: Elon Musk's industrial empire - Videos - CBS News

Only four entities have launched a space capsule into orbit and successfully brought it back: the United States, Russia, China and Elon Musk.

In Elon We Trust.

Jeffrey Ruppert

Facebook and Google’s Race to Zero — Tech Talk — Medium

Summary analysis of the tech giants' race to own the next 5 billion mobile internet users.

Definitely worth your estimated 6 minute read time.

Jeffrey Ruppert

Remember: something may not be so secret when it comes to Secret.

Wise words from the article - especially of you are posting about business or finance:

So if you’re an ardent believer in anonymity, be careful: If you reveal something important enough to be legally protected on one of these platforms, your anonymity might not be secure. The only secrets you can safely reveal on these platforms (and even then, only as long as they’re not crimes) are your own.

Quartz: When it comes to secrets, Wall Street titans and Silicon Valley VCs see eye-to-eye, http://qz.com/189363/when-it-comes-to-secrets-wall-street-titans-and-silicon-valley-vcs-see-eye-to-eye/

With my background in criminal defense, I couldn't agree more...and civil / contract / employment law will afford you little protection if you step out of bounds.

It's a lot like an adage a lot of us grew up repeatedly hearing - if you don't have anything nice to say, keep it to yourself.

Jeffrey Ruppert

Recommended Reading: How Freelancers Are Redefining Success To Be About Value, Not Wealth | Co.Exist | ideas + impact

http://www.fastcoexist.com/3025055/how-freelancers-are-redefining-success-to-be-about-value-not-wealth

Recommended Viewing: Should Politicians Be More Like Silicon Valley Entrepreneurs? » Techonomy

 

Interesting perspective.

My colleagues and I have been engaging for some time in what I have termed "political entrepreneurship" as we work to bring innovative thinking and solutions to progressive campaigns, committees and causes.

Maybe its time we demand the same approach from our political leadership - both those seeking office and those in power?  I think we all agree that we need something new in our politics and the halls of government.

Just bought CA Lt. Gov. Newsome's book Citizenville.  I'll report back on any insights. 

Jeff Ruppert

January 2014

Watch The Window: Tesla Gets Put to the Test | Wired Video | CNE

Tesla is on a roll. 

Even when produced by a third party, every image of a Tesla hitting the public conscious since Elon Musk's NYT response has been polished and buffed to a fine sheen.  Much like Apple of a few years ago, you want in on the Tesla experience, not simply to buy a great product.  You don't even have to buy Elon's vision for a greener future...you just want to be along for the ride.

Watch HERE.

Is $TSLA overvalued?  Perhaps.

But I don't see a need to sell high right now.

Call me a fan-boy.  Call me unrealistic.   

That may be true.

But HMV bought in at Tesla's low valuation for a long hold.

And that means HMV can enjoy the trip.

Jeffrey Ruppert

Recommended Reading: The Fundrise Blog — Crowdfunding Will Transform Finance Forever

Couldn't agree more:

From the perspective of an early adopter and inventor in the crowdfunding industry, I expect that the Internet will do to capital what it did to media and commerce—completely disrupt the status quo. 

http://blog.fundrise.com/post/51571350796/crowdfunding-will-transform-finance-forever

effrey Ruppert

Recommended Reading: Google reportedly in talks with South Africa and Kenya regulators to build wireless networks on TV airwaves - The Next Web

Quick read: http://thenextweb.com/google/2013/05/24/google-reportedly-in-talks-with-south-africa-and-kenya-regulators-to-build-wireless-networks-on-tv-airwaves/?fromcat=all

Reminds us that investing in Google ($GOOG) also reflects a belief in the possibility of emerging markets.

Jeffrey Ruppert

Recommended Reading: Dear Dumb VC — What I Learned Building… — Medium

Very interesting perspective on venture capital: https://medium.com/what-i-learned-building/e17153fde5f1

ppears to have grumped some VCs out, so must be on the mark on some points.

Looking forward to Dear Dumb Entrepreneur.

effrey Ruppert

Recommended App: Push Pop Press — Al Gore's Our Choice

Amazing iOS app from VP Al Gore: http://pushpoppress.com/ourchoice/.

eeded follow-up to An Inconvenient Truth packaged in an elegant, engaging app.

effrey Ruppert

Must Watch Video | TED TALK: What Would We Do If the Internet Crashed?

I'm well-known for being a TED Talks disciple (and also perhaps for the self-righteousness that can ​accompany TED fans) but this talk is a must-see...especially if, like me, you conduct and store a significant part of your life in The Cloud.

"We're setting ourselves up for a kind of disaster like the [one] we had with the financial system, where we take a system that was basically built on trust — was basically built for a smaller scale system — and we've kind of expanded it way beyond the limits of how it was meant to operate."

​It's scary stuff.  

​Just imagine your daily work and professional life without much of the connectivity and on-demand services to which we have become accustomed.  

​Mr. Hillis reminds us that this isn't just lost access to Facebook or work emails that we risk losing.  Increasingly, the internet is the backbone of our entire economy and, perhaps most menacingly, our communication, finance transportation and emergency services infrastructure.

Plus, with a failure of the sort discussed by Danny Hillis, this won't be like a storm or other event limited to any short period of time, geographic focus or service / provider.  Mr. Hillis is talking about SYSTEM-WIDE failure with the possibility of EXTENDED downtime...downtime occasioned by an otherwise innocuous error or the malicious acts of an individual or terror group.

The risks to our national and economic security are clear (once again, the tales of Chinese hacking are highlights).  The risks to us as individuals are no less so...how would you prove what you owed on your mortgage if the internet went away?

Like so many problems facing this nation (and indeed, this is an international issue), we shouldn't put our collective hands in the sand and hope that the HTTP levies will hold.

Let's be pro-active.  

On a personal level, back up your critical data locally; keep some hard records and memories; and have a plan to keep about how to get in touch with your loved ones.​

On a collective level, ​Mr. Hillis indicates that the solution may not be expensive.  Finally.  Let's get together and do something...maybe even the UN could actually agree on such a thing.

​I believe and have invested in the the future of the internet and The Cloud...it has the potential to continue to be one of the most disruptive tools ever utilized by man.

But always have a backup plan and ​never waste a crisis.​

Jeffrey Ruppert