The ONE Thing #9: Zone Of Genius, The Trouble With Optionality, History of Venture Capital & More
Happy Friday, everyone.
Today At A Glance:
🪄 Finding Your Zone Of Genius
🤝 A New Deal
👿 The Trouble With Optionality
💡 Powerful Ideas
📖 The History of Venture Capital
I’m about to embark on a new project, and I have been spending a lot of time, about what motivates me and how I want to spend my time.
I believe that self-awareness is the key to happiness and success. Therefore, I’m sharing three tools that help me to figure out what I enjoy and what I’m good at:
Zone of Genius
1/ Energy Matrix
Plot all your activities and responsibilities on a 2×2 matrix to see what gives and what drains your energy. Stop all unimportant and draining things, and find ways to do more of the things that give you energy.
2/ Ikagai (生き甲斐)
A Japanese concept, meaning “a reason for being”. Simply put, it’s about finding the intersection of things that satisfy, excite, and fulfill you and what you can be paid for.
3/ Zone of Genius
Your Zone of Genius is where your interests, passions, and skills align. Well explained by Sahil Bloom in this thread:
Crypto meltdown? No better time to share my most recent DeFi/Fintech investment: Kudona is bringing interest rates back by allowing easy and secure access to Decentralized Finance (DeFi) for the European mainstream consumers.
With Kudona, you can earn 3.8%+ annual interest, generated through DeFi lending. It’s simple (just send or withdraw money any time), secure (bank-level security measures), and transparent (real-time tracking and no hidden fees).
Here’s why I’m excited to invest:
Big problem: In Germany alone, €2 trillion in uninvested cash savings are eaten up by inflation and low-interest rates.
Timing: Consumers are desperately looking for solutions to “protect” their savings. DeFi offers annual yields well above current inflation rates. But DeFi is complicated and therefore inaccessible for the average consumer. The infrastructure that works seamlessly with the existing financial system doesn’t exist yet. So Kudona is building it.
Product: Kudona starts with a simple and secure product that is attractive to mainstream consumers, offering the benefits of DeFi without having to be technical. They’ve put security and mitigation of risk is at the core of their product to provide maximum security of assets (but there is still risk of course because ”There ain't no such thing as a free lunch”).
Optionality: In the long run, Kudona can become the gateway to DeFi for mainstream consumers, and offer more products and services to its customers and expand into more markets. I assume hundreds of millions of people will interact with DeFi and Digital Assets in the coming years, many without even realizing it.
Team: A highly entrepreneurial team with high intensity and the ability to execute quickly and vigorously. Relevant experience, as the founders previously built products and technologies for leading European fintechs.
Kudona is currently being rolled out to all of Europe, and they are looking for beta testers. Sign up for the waiting list to become a beta tester and unlock an additional 0.5% interest rate.
This article is thought-provoking because it describes the flip side of trying to create optionality.
We often try to create optionality to achieve a certain dream outcome.
However, instead of enabling us to take risks and make choices, acquiring options becomes a habit.
These options become safety nets, and the dreams that these options were meant to enable slowly fade into the background.
But to achieve excess return ("alpha") you must be willing to take the required risks.
If your dreams are obvious to you, pursue them. Creating optionality or buying lottery tickets won't get you to your dreamy outcomes.
Three powerful ideas. That’s it. That’s the tweet.
I just finished The Power Law: Venture Capital and the Making of the New Future by Sebastian Mallaby. I’ve been a big fan of Mallaby’s writing, and this book is my new favorite.
The book is a deep dive into the history of Silicon Valley. From the first venture capitalists like Arthur Rock, Don Valentine (Sequoia), and Tom Perkins to the emergence of multi-billion dollar fund managers like Andreesen Horrowitz.
The book is full of interesting stories that shaped Venture Capital and Silicon Valley.
I especially liked the chapters about the early days when venture capital was considered liberation capital, i.e., investor money to allow great scientists to quit their jobs and turn their wild ideas into a company. While entrepreneurship is very common today, just 50 years ago it was highly unusual to start a company, not to mention a high-risk technology venture.
If you’re into startups, venture capital, technology or history, go read the book 😉
That’s it for this issue of The One Thing.
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Until next time. Keep learning!