Books, Avogadro, Brad Feld and science fiction

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I am just sitting in an airport in Poland, on my way to Italy, and thinking about a book I just finished reading called Avogadro Corp, its about a pseudo Google like company, which by accident invents a “Terminator” style AI, scary.

My favorite part of traveling is its my main time reading books, its the only time I have start and finish a book in a day or two, and at least for me the only way to finish a book. 
So since I’m supposed to board in 2 minutes, I’ll bullet point my points :

  • The reason I bought the book was Brad Feld post book Avogadro Corp, you can simply read his post, its better than me writing about it
  • It is awesome that I read a book, and enjoyed it because I read it on someone’s blog, so I will start posting short blog posts on more books I read and Enjoy (and use my affiliate account in Amazon :))
  • Reading Science fiction is really important for anyone who wants to Challenge of the Future, the link is to an amazing course by Peter Thiel (which requires another post)



Have to run to the gate

MIT research shows that eToro can beat the Market with Social Trading

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“The investor’s chief problem—and even his worst enemy—is likely to be himself”.
Benjamin Graham, economist
We just published with MIT a great research showing that the wisdom of the crowds beats the markets. 
If you believe that it is impossible to beat the markets and make money through trading, you’re not alone.  You can easily find many individuals who have tried their hand at the markets and lost, very likely some people you know.
Regulators have found that more than 9 out of 10 traders lose money, according to the New York Times.  The Wall Street Journal reported in March that in each quarter of 2011 more than 70% of individual trading accounts did not generate profits at FXCM, a large foreign exchange broker.
Experts also support his claim.  Nobel laureate in economics Daniel Kahneman, for example, states that financial markets are highly sophisticated and thereforeimpossible to predict:
“The sub­jec­tive expe­ri­ence of traders is that they are mak­ing sen­si­ble edu­cated guesses in a sit­u­a­tion of great uncer­tainty. In highly effi­cient mar­kets, how­ever, edu­cated guesses are no more accu­rate than blind guesses.”
He believes that even so-called professional traders making decisions with conviction are really just rolling the dice in competing against the markets.  
After studying stock investments held by households, Professors Brad Barber and Terrance Odean concluded dramatically that “trading ishazardous to your wealth.”
Barber and Odean believe that overconfidence leads traders to trade larger volumes in the financial markets, implying that overconfident traders see their analysis of market information as highly accurate, beyond reality.  Their evidence leads to the conclusion that overconfidence allows traders to believe in their abilitiesdespite the data against them.
I believe that social trading will revolutionize this scenario: the wisdom of the crowd will allow traders to beat the market. 
More significant than my own declarations, research from the Massachusetts Institute of Technology (MIT) Media Lab proves that individual traders who trade using eToro’s Copy Trader earn on average 4% more than on their own.  With guidance on which Guru traders to copy on the OpenBook, tuning the social network, traders earn 6-10% more than trading independently.
I am very excited to share this great research thanks to Dr. Yaniv Altshuler at MIT, and encourage you to read more about the study here.


When your CEO offers you a day off work, Its time to wake up..

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What a cool experience !
I wrote a blog post about creativity and it was posted on out company’s site :

When your CEO offers you a day off work, Its time to wake up..

 ·  ·  · Share · 6 hours ago
Couple of hours later, I get an SMS from one Anna, our training manager :
“I’m having a spontaneous picnic lunch in the park. Summon the masses! a bit of vitamin d will do etorians some good!”
So I take Amit, our VP R&D, to our weekly to the park and post this on our group :
spontaneous creativity , u r welcome to leave what you are doing for one hour and come to the park
and about one hour later, about 40-50 eTorians are sitting in the park talking about their dreams, hope it was fun for them as much as it was fun for me 🙂
Just another day? Not in our office!
Will be continued…


eToro – Be All You Can Be

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In one of my conversations with Lior Hakim, an eTorian who recently moved to Berlin, we talked about how hard it is to inspire and motivate your employees all the time, and he told me something that suddenly made a difference: “We helped their dreams come true”. We should always seek how to help our employees’ dreams come true.

As a founder, what I really want is to make our dream (vision) come true. As a manager, I want to work with people who make their dreams come true, people who are passionate about what they want. It’s about letting our users be all they can be, and it’s about all of us being all we can be.

After our discussion, Lior wrote what he thought we should do to help everyone make their dreams come true:

Complete spontaneity is the best energy for creativity. Go from office to office and tell everyone to grab 2 sheets of paper and a pen and meet outside at the park across the street. Teach everyone how to fold a paper airplane with one sheet of paper. Then explain: I want to feel your passion. I want to work with passionate people that are making dreams come true. We always say we are the largest Investment network. The best Investment is not valued by returns, but by having someone invest back in you.

Openness

I’m passionate about making people be all they can be. That’s what eToro is about. If you see this as just a work place then we are doing something wrong. We are creating a new culture; in the future people will invest in each other to help them meet their passions and realize their dreams. Our success is the amount of dreams and passions one can bring closer to reality. Everyone has to share a dream or a passion. That’s the best way to make a dream come true. If you say you don’t have one, I don’t believe you. Open your heart. Every time you meet or work with someone you first have to know what he is passionate about. As yourself what his dream is and trust in its potential of coming true. If you think of a way to advance this process let others know. How come we don’t have a band? A basketball team? A dance group? This is important to us. Take the day off, clear your daily tasks and focus solely on this, and understand how we can make sure this becomes the essence of our culture. 
Each of us has a paper airplane. Take the other sheet of paper and write down your dreams and passions. Now let’s make both of them fly. At least one dream can come true today. Let’s find it.

So who wants to go to the park ?

The Social Boom – Google advertising on LinkedIn, Facebook advertising on Google

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I was really surprised to see both Google and Facebook in user acquisition mode, buying media to get users to open a free email account, and simply going to Facebook ?

I don’t know if this is due to Zuckerberg kicks off Facebook road show but seeing Facebook ads all over the internet is simply weird.
I really doubt there is an ROI model there, where Facebook actually calculates the value of each user coming from acquisition (yearly revenues from ads) and the cost of the ads, and optimizes based on that, it seems more like brute force “lets bring more users”.  

The same goes for Google spending on Linkedin to bring more users from LinkedIn to use its email or sites services ? ROI ? I don’t think so, so if not ROI, why are the different social network willing to buy ads on one another to increase users ? branding ? I doubt any of these companies need any branding effect coming from any type of online marketing. 
So if you don’t spend money on advertising to generate profits (ROI in user acquisition), and not to create brand awareness, then why ? Maybe they are simply pumping users and each others revenues, maybe Facebook spending on Google, and Google on LinkedIn is simply a way for them to increase prices by creating more users and less ad space . 

I don’t think we are in a bubble (yet), unlike experts who see parallels between dot com social media bubbles, but if we keep seeing advertising for services from the companies who sell advertising then we are sure in our way to one. 

Google Advertising on LinkedIn

Ads by LinkedIn Members


Facebook advertising on Google :

Social Finance, and Thomas Edison

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I believe Finance can become better .
I believe Finance should help anyone achieve his dreams and make the world a better place .
I believe in Social Finance . 
In Social Finance, all members can get Social dividend (or Social Credits) to their account based on their contribution to the society.


Social finance can apply to any type of financial transaction : trading, investing, payments and payment methods, virtual credits, virtual goods, insurance, debt, tax payments, IPO, M&A and any form of banking.


If truly all the members of society try to help one another, for example, donate every month for the health of other can replace Insurance, by building a social insurance network . IPO and fund raising are being replaced by  Crowd funding .


Anyone can use Social finance, all Social Finance transactions are transparent, and all transaction are with virtual credits.
Virtual credit is better than money, it has less constraints and friction and therefore can move faster and generate more opportunities for more people, any member constantly Social Credits to his account for doing any work for the network, people choose how much to contribute if at all. 


The world is becoming smaller, socially connected, transparent, and based on trust (rather than prices), and therefore finance should adapt and become social finance. Free for everyone by everyone.


Thomas Edison Invented “a stock ticker, a mechanical vote recorder, a battery for an electric car, electrical power, recorded music and motion pictures.” . WOW this person invented so many things 100+ years ago, that it makes all of the current “innovation” period in the internet look small compared to that. Steve Jobs invented a small machine to hear recorded music on, and how people buy recorded music. Thomas Edison Invented recorded music. Soon the internet will really start changing our life, Social computing a form of programming which is dynamic and constantly changes with humans constantly changing code and updating the network in real time, will enable much faster inventions coming to life, and we will see a boom similar to the one more than a hundred years ago. 
Social Finance is key for that transition to happen, Social Finance accelerates the formation and exchange of finance (raise money faster, collaborate to invent faster, develop faster etc, launch faster, create financial model faster etc’).


Social Finance is soon going to over take traditional finance, its just a matter of product.



Why (most) entrepreneurs don’t have college degrees and (some) blonde women are dumb

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Simply put: Most entrepreneurs don’t need one.

If you’ve ever had a really good-looking girl in your high school, you probably noticed that she can say the dumbest things in the world, and yet no one would correct her. Men would simply stare at her ‘eyes’, and women would giggle. While regular, average looking people get corrected, beautiful blond women don’t, and they still get along in life, and never stop to wonder why things don’t add up (sometimes literally) .

The same can be said about entrepreneurs, albeit a bit different. I participated in an interesting panel in NYC for MBA graduates with Ran Harnevo, Adam Singolda and Idan Cohen, the CEOs and founders of 5min Media (Now AOL Video), Taboola, Boxee and eToro, respectively. You can read more about the panel in Hebrew here.

One of the questions the host asked us on stage was what courses we would recommend to MBA students. After an awkward silence Ran took the microphone and said that’s not a good question to ask him, as he doesn’t have an undergraduate degree, and the rest of the panel quickly joined in saying they don’t have either undergraduate nor graduate degree. All participants are extremely smart, extremely successful people, that never needed any type of formal education.

Ran wrote a post (in Hebrew) about a very interesting following up on a post by Fred Wilson, and asked 13 top start-up CEO’s whether they have college degrees, to find out 8 of the 13 don’t.

Conclusion – You don’t need a college degree if you can build a Multi Million Dollar start-up, or good-looking enough to marry someone who can.

Everyone else should consider enriching their education and watch the video Changing Education Paradigms by Sir Ken Robinson, to learn why formal education is not working today.

Like everything else, education as we know it will change with the internet. Companies like skillshare will distribute and democratize it, so you can learn anything from anywhere and (possibly) get a degree in it from the internet, much like earning points in FarmVille.

“If you’re not prepared to be wrong, you will never come up with something original.”
–Sir Ken Robinson

 

The thin line between business and economics

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A couple of years ago, I’ve heard a very interesting discussion between a rich business man and an economics professor. It went something like this :
Biz man : I have a question regarding my business plan
Prof : Sure, I can help you with the economics
Prof : But the economics of the model don’t work
Biz man : Why ? I really think people might buy it at this price
Prof : In the long term the Economic Model is not sustainable
Biz man : This is a great Business Model, I made $50M in business and you probably made nothing, what do you understand about economics ?
Prof : I’ll answer to that with a question, what is the highest paying profession a 18 year old female can work in?
Biz man : ok
Prof : that profession allows an 18 year old women to make 250 USD an hour or more at the start, at 250 an hour, working 100 hours a month, that’s 25K a month, after 40 month, before the age of 22 she cold have made a million USD.
Biz man : So ? What’s the relation to our discussion ?
Prof : I could have made millions from my knowledge, probably more than you, I simply DECIDED to do something better

I also have an Infographic if you didn’t understand 🙂

eToro wins Red Herring Top 100

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I am on my way back after spending 2 amazing days at the Red Herring top 100 event in Amsterdam. Red Herring represents the dot com era, and it seems it’s coming back to lead the new wave of the social era.

Alex Vieux said on stage, “We are at the beginning of the best bull market ever seen,” and after hearing it for the 4th time this month (from bankers mostly), and knowing I am hearing this from people who were very close to the dot com during ’98-’99, I believe there is good ground for this to happen. Alex’s discussions on stage also represent why Red Herring is of high standard. He invited VCs and entrepreneurs to the stage, and asked the hard questions: “What do you regret?”, “Why is it bad to raise money?”, “When did you fail?”. He doesn’t let anyone calmly sit in their chair for more than a minute.

The return of Red Herring is a great symbol of the era that’s about to start, and that is also why I am so proud to be a winner of the Red Herring Top 100 Europe.

When you look at the Top 100 Europe, you find something quite amazing: a lot of companies with revenues of 50-100M  that started in the past 7 years. Being in such a group of accomplished companies makes me proud we made the cut. The fact that until 5 minutes ago I didn’t know if we are going to win made the feeling of winning much better. Seems that risk alone can create a feeling of reward. When something is certain it can’t be exciting as when something is uncertain, that’s an important fact to remember. Winning is fun only when you don’t know for certain you are going to win, and just like in trading, the higher the risk (of losing), the higher the reward. Great Job everyone at @etoro!
(Sent front a plane in Amsterdam)