Fintech Holiday Homework

We hope you enjoy the holidays, but if you’re like us, you’ve got one eye fixated on 2017 already. For those of you looking to get a jump on next year, doing a little homework and deeper thinking — apart from just keeping up with the weekly news and white paper flow — may be just the ticket you need. As such, we are taking a break from our regular format to offer our suggestions on a few things to read, listen to and watch over the holidays. Hopefully, they will help you in your 2017 preparations.

Note: There are no commercial arrangements associated with the following book recommendations.

BOOKS

Superforecasting: The Art and Science of Prediction

Saying that 2016 was a dumpster fire for professional forecasters is an insult to dumpster fires. But if you had read this 2015 book on forecasting, you might not have been surprised by some of the unexpected things that occurred in 2016. Whether you’re a start-up entrepreneur, VC, M&A banker or investment manager, having a forecasting framework that enables you to rock a Brier score would be a very valuable asset. In Superforecasting, Phillip Tetlock and Dan Gardner reveal insights into the methodologies of superior forecasting by highlighting Doug Lorch, Bill Flack and Sanford Sillman. These three ‘superforecasters’ you’ve never heard of have outperformed intelligence community analysts by a wide margin. How do they do it? The book attempts to shed light on that question while making the overarching point that forecasting isn’t a mysterious gift. It’s the product of a systematic way of thinking.

FinTech Innovation

Our friend, Paolo Sironi of IBM, is an Italian based in Frankfurt who works for a major US company where he travels the world discussing how innovation is changing wealth management. As a result, his opinions are informed by a global perspective that reappears throughout his comprehensive book, FinTech Innovation. Sironi is at his best when he links new technologies to the concept of goal-based investing, which puts an individual’s personal goals and lifestyle at the center of the investment process. When done with superior tools and a solid understanding of portfolio theory, says Sironi, this approach can strike an optimal balance between risk, liquidity and investment horizon.

The War of Art

“Most of us have two lives. The life we live, and the unlived life within us. Between the two stands resistance.” That the core point behind this insightful 2002 book by Steven Pressfield.  Whether the battlefield is a start-up you’re trying a build, a book you’re trying to write or an addiction you’re trying to kick, you’re sure to encounter resistance.  Pressfield urges his reader to wage war, total war, to defeat this formidable, internal enemy.

PODCASTS

Financing insights from Startup L Jackson.

Parker Thompson’s career has taken him from Pivotal Labs to 500 Startups to his current role as a partner at AngelList. During his journey, he also created the hugely successful Twitter account, Startup L Jackson, that both delighted and lacerated Silicon Valley.  In the attached podcast from The Twenty Minute VC, Thompson discusses his current role at AngelList and his view on bridge rounds, how entrepreneurs should interact with VCs and Andreessen Horowitz’s unique model. It’s an enjoyable listen from one of Silicon Valley’s sharpest minds.

Financials after the Trump Trade.

Whatever you think of the President-elect, there’s little doubt that the business environment, especially for banks, will be impacted significantly by the incoming administration. To make sense of it all, we turned to Richard Ramsden of Goldman Sachs. Ramsden, a business unit leader in the firm’s Financials Group, had much to say on topics including the yield curve, economic growth expectations, US fiscal policy, online payment technologies and divergent monetary policies in the attached edition of Exchanges at Goldman Sachs.

A cautionary reminder to bankers courtesy of the Medieval period.

The first modern bankers didn’t work at Monte dei Paschi. They were warrior monks who enabled Medieval pilgrims to travel from London to Jerusalem without having to carry all of their money with them. That’s the characterization of the Knights Templar made in the attached podcast (Planet Money: #742). So what happened to this partnership of monks? It turns out they lent money to the wrong person, or king, to be exact. In a bold move to extinguish his unpaid debt obligations, King Philip IV of France rounded up the money-lending monks, tortured them and burned their leader to death on a spot now occupied by The Temple stop on the Paris Métro Line 3. Perhaps the Knights should have quietly written off the king’s loans and focused on lending money to less powerful people.

VIDEOS

The relationship between computational technology and employment.

Whether you’re analyzing the concept of Universal Basic Income, the degree to which a financial advisor’s job is threatened by an algorithm or the future of America’s middle class, the core tension between innovation and employment appears. Fintech, given its increasingly important and growing presence within the technology world and our economy at large, is front and center in addressing these issues. That’s why we’re suggesting you watch the attached Charlie Rose interview featuring Jaren Lanier, currently of Microsoft Research and author of 2013’s Who Owns the Future?

Taking the Golden State Warriors to greatness.

“In the NBA, they separate the basketball business people and the business business people. In our culture, they are on the same floor.” Those paraphrased words from Kleiner Perkins partner and Golden State Warriors owner, Joe Lacob, is just one of several key insights on how he used his Kleiner training to pursue a policy of relentless excellence in building the Warriors. The result: a full turnaround that led to a championship in five years.  

QUOTE OF THE WEEK

"I was raised in a Baptist household, went to a Catholic church, lived in a Jewish neighborhood, and had the biggest crush on the Muslim girls from one neighborhood over."

~ Will Smith (aka The Fresh Prince of Bel-Air)