Beliefs, Blockbusters, and Boyhood
A Smorgasbord of Reactions
This is a weekly newsletter about the art and science of building and investing in tech companies. To receive Investing 101 in your inbox each week, subscribe here:
Life rolls on, like the flow of a river. Each week you think you'll end up in one place but you never know where it forks and turns. And where you end up is very rarely where you thought the controlled chaos would take you.
What I've come to appreciate about keeping a journal is that you recall more easily each turn. Even if you're always surprised by the eventual outcome, you can better recall the journey. This blog acts as a bit of a journal, but a journal of ideas rather than a travelogue for my life.
I'm thinking about that even more today because all I have time for this week is to touch on a few reactions to things I've had this week that has informed my thinking.
Often, these ideas would go into a note and gather steam over time until they shape up to a full blown blog post. This week, I find myself in Las Vegas for my nephew's baptism. So in a house full of crazy cousins and quick-moving plans, I have even less time and attention span to shape a post than I typically do.
So, when thinking about what I could pull together, it was to take a few of the nuggets and just share them out in raw form. Though pretty different topics, they lent themselves nicely to a nice alliteration: beliefs, blockbusters, and boyhoods.
"Who Has Beliefs? And Who Has None?"
The first nugget is Tim Walz's comments on Tesla's stock price. This is one that I feel like has been discussed ad nauseam by both sides of the political spectrum. But I'm not as angry about conservative vs. liberal talking points. I'm drawn in by what it says about stated vs. revealed beliefs.
Liberals, in general, are the party of climate change prioritization. It's often described as an existential threat; maybe the only threat that matters because it could lead to human extinction. So if you think climate change is an important issue, and you believe that decarbonization is the best path forward then vehicle electrification is a critical piece of that puzzle.
Tesla is, by all accounts, a key catalyst in that evolution. Tesla's success explicitly caused car manufacturers like GM and Toyota to prioritize electrification. The adoption of of Tesla's North American Charging Standard (NACS) by companies like GM and Ford have further pushed the distribution of electric vehicles. Whether you like Elon Musk or not, Tesla has played a critical role in pushing forward EVs.
As a liberal standard bearer, like Tim Walz, I would think that the prioritization of climate change would rise above the petty squabbles of political figure heads. Apparently, it does not. Garnering the support of "Us" against the monolith of "Them" is more important than any singular issue, including the existential threat of climate change.
The demonstration reminded me of another interaction I saw on Twitter. First, if you aren't familiar, Lulu is one of the absolute BEST follows on Twitter. She often breaks down the comms strategy of different high profile launches, events, or celebrity breakups. They're great. She did that in reflecting on the launch of Gavin Newsom's new podcast where his first guests were Republican luminaries like Charlie Kirk and Steve Bannon.
First, I was also impressed by the podcast. Again, anyone who jumps right to "how does this align with my [conservative/liberal] approved world view?" is just going to be angry. But if you can reflect on it honestly, its really interesting to see someone engage with a political opponent in such a balanced way. It's very rare in modern politics. And I thought it was interesting.
But when you unpack the substance of many of Newsom's discussion topics, you find things that he explicitly stated as beliefs before that turn out to be wishy-washy topics up for debate depending on how centrist you need to be that day. One of the responses to Lulu's post struck me:
"Also demonstrates that he believes in nothing." Savage.
Beliefs are beliefs, regardless of how politically, financially, and personally advantageous they are.
I'll give you an example of an unwavering belief that I have a ton of respect for. I've watched dozens of interviews with Palmer Luckey, the founder of Anduril. So many interviews that I can't actually remember which ones he's talked about this in, but he has.
If you're not familiar with the context, before Anduril, Palmer was the founder of Oculus which he sold to Facebook for $2B. Later, he was fired from Facebook because of a small political donation that he made. Palmer describes it as one of the most formative experiences of his life because he was so soundly betrayed, and it has formed an immense chip on his shoulder.
Despite having plenty of evidence that he was illegally fired for political beliefs, he has explicitly said he made a deliberate choice NOT to go scorched earth on Facebook with lawsuits. Why would he do that? Because he believes in VR.
He believes in VR so much that he said no to a $1B offer from Facebook. It wasn't the $2B price tag that sold him. It was the commitment to also commit to investing $1B a year into VR for ten years! Palmer sold Oculus because of what that kind of investment would mean for the progress in VR.
He believes in VR so much that, even after he was summarily attacked for benign political donations, and thrown to the wolves by Facebook as a corporate entity, he STILL chooses not to go scorched earth on the company. Because, ultimately, though he might win the legal battle, he would do damage to the VR industry. And his beliefs run deeply in support of VR, regardless of how personally damaging it was to let the record stand in obscurity.
Conviction in something is measured by your willingness to maintain that belief, despite how uncomfortable it becomes for you. I was reminded of the quote from the Hamilton musical when he chooses to side with a political enemy like Thomas Jefferson over Aaron Burr for a specific reason: “Jefferson has beliefs. Burr has none.”
The Hits Business Strikes Back
The second nugget is the massive $320M flop that is Netflix's new movie, The Electric State. Seemingly unconnected, but when I think about beliefs, I think about incentives. And the most powerful incentive is money.
I've written before about The Hits Business, where venture has taken on similar characteristics to the blockbuster business. Movie makers increasingly saw these $1B+ blockbuster hits, and swarmed programmatically around the characteristics that most often lead to that — established IP, sequels, reboots.
If you've been reading my stuff for a while, you know that I'm a massive movie fan. Most of my life experiences are understood through the prism of movies and TV shows. I love movies. But I also get personally invested in the stories I see. And I get so bothered by bad stories. One of the most egregious disappointments of my life are the movies in the DCEU. I loved the initial three phases of the MCU so much. But in my upbringing, I didn't care about Iron Man or Thor or Captain America at all. I cared about Batman and Superman and Green Lantern.
I grew up on Batman: The Animated Series and The Justice League: The Animated Series. Granted, I'm not a comics purist, so there is some nuance I lose. But when I tell you that I've never walked out of a movie more clinically depressed than I did after Batman vs. Superman in 2016, it's because those stories are a critical part of me.
And when I look at why so many of these movies are terrible, its because they represent massive financial outcomes. They get made because its not about the story. It’s about the outcome. As bad as the stories are, Batman vs. Superman still made $800M. Aquaman made $1B. Jurassic World made $1B and two ungodly sequels, with another one on the way.
And as sad as it makes me, it aligns directly to what the studios who make movies believe in: profit.
Most Hollywood studios are either publicly traded companies themselves, or are part of public companies. So there is the ever-present overhang of earnings calls and stock prices to contend with. That's why you see things like David Zaslav, the CEO of Warner Brothers, saying explicitly that the studio would focus on tried-and-true IP:
“We’re going to focus on franchises. We haven’t had a Superman movie in 13 years. We haven’t done a Harry Potter in 15 years. The DC movies and the Harry Potter movies provided a lot of the profits for Warner Bros … over the past 25 years.”
These kinds of people make movies, not because they believe in the power of storytelling, but because they believe in the centrality of making as much money as possible. Which brings me to The Electric State.
This is a movie that attempts to follow the explicit Hollywood checklist for making billions of dollars:
Big stars: Chris Pratt (I guess still what they think we want), Millie Bobby Brown (the youths love her), Ke Huy Quan (did you see that Oscar's speech?)
Big directors: Joe and Anthony Russo (they made a ton of money on Avengers movies, it was probably them, right? And not the 15+ movies of build up).
Big budget: $320M is not just a lot of money, its about the same as the entire combined budget of every Best Picture winner since 2010. It's the thirteenth most expensive movie ever made.
Established IP: The movie is based on a 2018 graphic novel, counts as established right? Nobody needs to check how popular that novel was.
Across the board, it should have been a smashing success, right? Wrong. It has a 15% on Rotten Tomatoes and is on track to be a massive bomb.
My brother-in-law and I had a really fascinating conversation over Christmas where we talked about movies that felt truly exceptional without most of the stuff on that checklist. Movies like Whiplash, The Brothers Bloom, Nightcrawler, Memento, Arrival, Prisoner, Her. Exceptional stories, and none of them cost more than ~$25M.
But there are also movies like Interstellar, 1917, and The Revenant that are also exceptional stories, but cost $100M+.
It isn't about cost, it's about why you make movies. And, so often, the very best movies are those that encapsulate exceptional storytelling.
People try and shortcut their way to big hits with the checklist that The Electric State used. But the reality is that that's akin to starting a company "to raise a lot of money." That's not what makes a big outcome. Building a good business is most often the thing that leads to success. The checklist is more like survivorship bias; the actually important variable is building a good business. Telling a good story.
Telling Stories vs. Spinning Narratives
Finally, the topic of storytelling brings us to my final nugget. The conversation happening about the new Netflix show, Adolescence, the story of a young kid who murders a young girl with a knife. The conversation I saw going around Twitter was the decision to change the race / story of the boy at the center of the story.
Side note: I'm not going to cite all my sources because, like I said, I'm busy + I'm typing this one-handed while holding my five month old.
What struck me as interesting about this story isn't that white young men haven't been radicalized, because many of them have. And not that the story of radicalized young white men leading to violence isn't a story worth exploring, because it is. But this specific choice of storytelling struck me as odd.
The TLDR of the story is the show creator read several news reports about young women who had been murdered with a Knife in the UK. One of the more high profile stories that sparked his interest was about a black man who stabbed a young girl to death with a knife (that's what the tweet above is angry about). He felt like exploring those stories through a show.
Out of curiosity, I asked ChatGPT a couple of questions (did not fact check details...)
First, have knife crimes really increased in the UK? Because I've heard that before. They most certainly have; knife crimes (not necessarily murders) have risen 80% over the last decade. Knife murders, on the other hand, have eerily remained pretty flat with almost exactly 250 of them in the UK each year since 2018.
Second, who are the most common victims and perpetrators of knife crimes in the UK. Turns out the narrative that liberals seem to want (white people kill white people) isn't true. And the narrative conservatives seem to want (black people kill white people) also isn't true. 45% of knife murder victims are black, and 61% of knife murderers are black. Often, those instances involve drug use and mental health issues.
So again, hopefully you can tell that none of these topics have meant to take a specific political side. I'm not angry because of my well-endowed conservative world view, nor am I angry because of my equally well-established liberal world view. In fact, I'm not angry. I'm reflective.
My reaction to this particular story was that there IS a story here. But when it comes to knife murders in the UK, despite the headlines, the most common story is that black people kill other black people with knives, often as the result of social issues like drug abuse and mental health issues. So why not tell that story?
Where Am I Going With This?
If I were to describe a common thread through all of these nuggets, it's this: we should all be more aware that our beliefs are fully on display. Whether its the company you choose to criticize, the movies you decide to make, or the stories you decide to tell or believe. They are reflections of your values — of who you are.
I'll end with this quote from Brennan Lee Mulligan, who I think is awesome where he talks about ideology and personality:
"Mostly, people are not motivated by ideological codes. People are motivated by impulse and construct ideological codes to justify and rationalize what they were already going to do. On the levels of individuals and civilizations personality predates ideology. Meaning before you were a fascist you were a bully and an asshole. What we talk about as philosophy and ideology; it's a little scaffolding you're putting on the outside of who you are."
The political parties we belong to, the companies we build and invest in, the programs we support or decry, the way we treat strangers on the internet and our closest friends, all of these components make up who we are as people. But, as far as I can tell, people spend very little time thinking about who that person is. Who have we become?
For some, they may think that concern isn't worth the effort because who we are is who we are, and we're too busy fighting the fight of our ideological in-groups to be bothered with the question of SHOULD we be in that particular in-group? However, who you are is not a fixed state. I genuinely believe that you can change. But it is a deliberate choice.
So often, we default to "well, my in-group thinks Donald Trump is a fascist or the second coming of Jesus Christ, so I should too." Or "well, Tesla is the carrier of the apocalypse, or humanity's only future for stock gains, so I’ll go with that." It’s the path of least resistance.
Instead, we should be more willing to embrace nuance. Unpack our beliefs. And say "even though my in-group is bothered by the actions of the CEO of Tesla, electrifying vehicles is a core belief for me as I understand climate change. Therefore, my values will overwhelm my in-group precedents.”
But that's easier said than done.
Thanks for reading! Subscribe here to receive Investing 101 in your inbox each week:
A really interesting tell on this is when beliefs flip flop with no explanation (very different than changing views w/ new information). Liking elon musk until you don't, hating donald trump until you don't. Supporting human rights until you don't.
So many people operate with very low conviction, convenient "beliefs". Low conviction would even be ok (the world woul benefit from more "I don't know about that" or "That's not important to me"). But instead, most people have convenient beliefs masquerading as high conviction beliefs.
Beautifully put together (I did wonder til the end what the common thread was!).
Though, our social and physical environments shape who we are so much, that it's perhaps far easier to focus on changing (or at min curating) our environments rather than changing ourselves (system > willpower).