Xiao Long Bao Inflation Index

Update to my tracking of the price of 16 Pork XLB at Nanxiang XLB in Shanghai. 1997: 4 RMB 2006: 8 RMB 2010: 12 RMB 2013: 20 RMB 2023: 33 RMB (25RMB for 12 pieces) That is only a 5.1% inflation rate over the last 10 years, which is actually a big slowdown from previous measurements!

Xiao Long Bao Inflation Index update

In 2006 and 2010, I logged the price of 16 "xiao long bao" (soup) dumplings at the restaurant Nanxiang, located in Shanghai. (This restaurant was the inventor of the tasty treat)

If you recall from my previous post about this, prices were:

1997: 4 RMB
2006: 8 RMB
2010: 12 RMB

This represented an annualized inflation rate of 8% from 1997 to 2006, and an inflation rate of 10.67% from 2006 to 2010.

I am (un)happy to report that the price in 2013 is now 20 RMB. From 2010 to 2013, this would represent an annual inflation rate of 18.67%

I mean this in the most unsarcastic way possible: Wow.

Phone plan pricing trends

After 3 years with Nexus Ones, Julia and I decided it was finally time to get new phones.

In comparing pricing plans between all the US carriers, I noticed a few things that I found interesting. First is that carriers are shifting from a "metered voice and text / unlimited data" pricing structure to an "unlimited voice and text / metered data" pricing structure. These new "share plans" also recognize that people are going to connect lots of devices per person and are metering based on that (fixed cost per device).

The other thing I noticed is that AT&T and Sprint are now allowing facetime over 3G, and in general carriers are now ok with users using VOIP over their data networks. This makes sense as they are metering data.

I wonder if the carriers are figuring out that it's ok to go with this because: 1) people dont' have as strong a sense of how much data they use versus how many minutes they talk, so they will be more likely to overbuy, and 2) the trend in general is for data usage to go up as new bandwidth heavy applications come out over time (whereas there was not such trend for voice/text). That last one makes a big difference because it potentially builds in automatic ARPU growth, making carrier management's lives easier.

Which leads me to wonder about Sprint. Sprint still offers unlimited data plans AND they allow facetime over their network. Time will tell whether Sprint shift to metering data once their LTE network is rolled out.. in the meantime they are the ugly duckling that has to give a great deal just to scrape enough customers to survive. My guess is they will, but in the longer run, how long will it take for industry competition to lead to unlimited voice/text/data plans becoming the norm? Will that ever happen?

Will this create even more downward pressure on Facebook stock?

My friend Yishen Kuik of Katong Capital made a keen observation today..

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Everyone knows that Eduardo Saverin, the Brazilian co-founder of Facebook, gave up his dual US citizenship just prior to the IPO of Facebook, and presently resides in Singapore. Lots of misinformed articles have been written about him as a tax dodger.

By leaving the US, he will trigger the Heroes Earnings Assistance and Relief Tax Act of 2008, which is Orwellian DoubleSpeak for an exit tax on 15% of his capital gains. The trouble is, when the Exit Tax is calculated, it is on the valuation of the stock on the date of renunciation.

No doubt Saverin was advised to time his renunciation prior to the IPO because most IPOs are engineered to pop and rise thereafter, as Mark Cuban is aware. FB however did not perform thus, and has dropped 50% since. What this means is that Eduardo is down 65% from when he made his renunciation. In order to pay the 15% tax, if he hasn't already sold stock, he will now have to sell 30% of his stock to do so. Based on his 4% ownership of the company, this is about 1.2% of the shares outstanding.

Of course what is left is still sufficient to support several lifetimes of spending, that is unless you are an NBA basketball player

Some more political ads designed to cast Chinese as the enemy

In the past I've written a bit about how US politicians were starting to demonize Asians, and specifically Chinese (all look same anyway!)

and of couse the well produced commercial about a chinese professor lecturing to his students.

today this ad appeared during the Superbowl in Michigan.



I also just saw this video from half a year ago for some dude that ran in Nevada for Congress

"Search, Plus your World"

This is probably stating the complete obvious, I know.

Just a theory.. "Search, Plus your World" isn't about improving search, it's about getting people to start using Google+ more.

In LinkedIn's early days, I remember a lot of people having profiles but nobody really using it that much. Then over time, Linkedin's Google juice went up and all of a sudden, whenever anyone googled themselves they saw their Linkedin profile.. so of course, out of vanity realizing other people would see their profile now, everyone thought "oh shit i better fill this page out more"

So Google placing Google+ profiles high in default search results is maybe less about helping searchers find the best search result, and more about giving distribution to people's Google+ profiles so people are motivated to finally start using it more.

If so, it's a smart move.

update: I just noticed that Google puts a "Update your profile, it's only x% complete" link on the search results page when you google yourself.. To me, this pretty much confirms it. Google is smart.

How I finally managed to start doing small exercises regularly

I've tried many times in the past to try and do some small exercises regularly, but i've never been able to keep it up for very long. 3 or 4 months ago, I went to a talk given by Dr. BJ Fogg, and experimental psychologist at Stanford.

He talked about behavior modification, and how in order to achieve it one needs 3 things: a Trigger to get you to think about the desired behavior, the Motivation to do it, and the Capability to do it. During his talk, he asked everyone in the audience to laugh and cheer whenever anyone's cell phone rang. This was quite interesting, he was connecting the desired behavior to something that had NOTHING to do with the behavior.

That night, I decided I would start doing wall squats for 2 minutes as I brushed my teeth (2 min is easy to time because I use a sonicare toothbrush which lasts 2 minutes). It's dead time anyway, i figured. This worked like a charm, twice a day I have been doing wall squats since I started. After a week of pain things started to get a lot easier, so I started using my wall squats as a trigger to do pull ups (search for the door gym on amazon), pushups, situps, and a few other things. All in all, it takes about 2 minutes in the morning and 10-15 minutes each night. After a month of that, I've started going to the gym again.

The point is, the trigger can be anything. By my own willpower, I've never been able to create a strong routine of doing any exercise, but in the end all it took was piggybacking on top of something I already do as a habit: brushing my teeth.

Really excellent paper

This was a really good read. It describes perfectly how entrepreneurs approach building things.

Gotta love the "Typical MBA Horseshit. The World in 4 Boxes" commentary too! Whoever marked this thing up is my hero.

What Makes Entrepreneurs Entrepreneurial

Update: commenter says it was Vinod Khosla who marked the paper up. Makes a lot of sense, Vinod is awesome!

The price of democracy (to us)

I am supportive of democracy in the Middle East, if true democracy can be achieved. While extremists grab the headlines and form our impressions, the average person in these countries want the same things everyone else wants: food, shelter, opportunity, a sense of future and hope for their children, friends, family, and peace. Systems of government in the Middle East that distribute the wealth of their resources can be stable. However, there's a lot that can go wrong between where we are now and such a utopian vision. It not likely to happen, because where there is oil there is power and where there is power there is corruption.

What I really want to talk about is the price of these revolutions to those of us living in the rest of the world.

Ever since they started pumping oil out of the ground in the Middle East, the western world and the US government in particular could give a damn about democracy in the region. All they wanted was stability and "their guys" in control so oil could be extracted at a good price. Have no doubt, half of the guys being toppled are "our" guys. Now that they are being ousted, it can only lead to oil becoming more expensive.

This is bad news for our economy. As we learned in the 70s and in 2008, as energy prices rise, everything else falls. EVERYTHING. Energy is the basis of most of the technological leverage the world has created over the past 100 years. Google's servers need energy. Your cell phone needs energy. The food we eat requires a lot of energy, from fertilizer to pesticides to transporting that banana from south america to your plate. Energy is everywhere. If prices rise, expect everything to get a lot more expensive. Expect corporate profits and the stock market to fall. Expect real estate to fall. The only thing that might not fall is gold, due to the worldwide civil unrest that may ensue.

Considering an out of state Pied-à-Terre? Think again!

Well here we go. It's clear that States and Municipalities are in trouble. You hear examples about even here in the bay area. Half moon bay is considering disbanding their police department to avoid bankruptcy. I think I heard there was talk of even unincorporating there. San Carlos already disbanded their police department. Vallejo declared bankruptcy in 2008.

The problem is that the municipalities can only be propped by the states for so long.. California is on track for a $25 Billion deficit this year... and neither the states or the cities have the ability to print money like the US government can.

The only way to deal with this problem is to either scale local and state government down (expect crappier roads and lower quality of services) or to raise taxes. Expect both.

In an astounding example of how aggressive states are getting (and this is likely just the beginning, check out this Wall Street Journal article.

Apparently NY is getting technical on their definition of what sort of residence can be excluded as a permanent residence. The generally accepted policy is that one owes taxes to a state only on income generated in the state even if they have a vacation house that they use less than 180 days a year. But apparently a vacation house must be a "mere camp or cottage".. so if like in the case mentioned it is deemed suitable as something someone could actually live in (in this case, an 1100 sq ft house), then NY feels it can now go after ALL income.

In other words, because this family owns a house in NY, NY wants to tax them on all income on top of the taxes they are already paying in their home state on the same income.

WOW. more to come i'm sure.

Asianz have come a long way

As I was growing up, asians in the US mass media were either depicted as hot subservient women that would make great newscasters or tekashi/long-duk-dong style nerds. Sure I played the violin (or piano) like every other asian kid too, but that didn't automatically make me an incompetent driving, accent sporting nerd.

There was a brief attempt in the 90's to change this, with Russell Wong getting his own show called the Vanishing Son , but 1) he's half asian and 2) he was still a martial arts expert. It was basically the show "Kung Fu" all over again, and it wasn't very good. There was also a rap group out of LA called the L.A. Boyz. They were pretty talented, but probably came to the conclusion that Asian rappers would never make it in the States in those days, so they had to go to Taiwan to build an audience.

So it's pretty cool to see a lot of Asians in the half generation behind me actually making it in the entertainment scene. One of my high school classmates, Tim Kang (pic left), is on some big CSI type show called the Mentalist.. and while I can't say that it is exactly my favorite show, it's nice to see that he isn't forced to fake an accent or anything. Is he a math whiz in the show or something that I don't know about? Also notable is John Cho from the Harold and Kumar series.. and even though he does play a somewhat anal asian stereotype, the dude likes to light up and that is new.

But the place you are really seeing it is in the music scene. I am a big fan of the MTV show America's Best Dance Crew, and quite consistently there are really strong asian teams on there. Many of them win. One of the members of the Black Eyed Peas is Filipino-American. The current lead singer of Journey is a Filipino dude that they actually discovered on YouTube. The reason I was just thinking about this is because I just realized that Far East Movement, the group that did that "Like A G6" and now "Rocketeer" song is a bunch of Asian dudes from LA. (In retrospect it should have been obvious they are Asian-Americans based on the name of their group, but the fact it wasn't probably says something).

I'm very happy to see this happening, and for once I think I will actually buy an album in order to support this effort. Anything to help erode lingering memories of Long Duk Hong ;) It's nice to think that Jackson will grow up in an environment where nobody's thinking he can't be cool because he's Asian.

Disturbing video

Yet another example of propaganda being put out that may contribute to racism against Chinese people (and Asians in general) in the US.

US Politicians creating propaganda against the Chinese

The level of hypocrisy on Tim Geithner's part when he accuses China of manipulating its currency is astounding. The US is manipulating currency more than anyone else out there. It's no wonder the US is having a hard time rallying other countries to crack down on China on this issue.

Tim is not the only one badmouthing the Chinese for political purposes. According to a NYT article, China is now being scapegoated in a ton of political ads this season. As usual, these political ads exaggerate and take data out of context in order to create fear and anger, in hopes of drawing votes. For instance, they might claim that China has "stolen" x manufacturing jobs from the US, when in fact those jobs had already been exported long ago to countries like Taiwan.

I speak a bit about where this kind of scapegoating can lead in a former blog post. It's not pretty.

Random ramblings on #Angelgate

Hey everyone, I just got back from my yearlong world trip, and man have things changed!

i was thinking a bit about the whole angelgate thing. i think it boils down to the model that a successful angel has traditionally needed 2 things to be successful : 1) good dealflow and 2) skill at picking the right deals.

Things like YC and naval's angel.co thing are having the effect of commoditizing the dealflow, making high quality deals accessible to way more people than in the past, making it so people who USED to make money just by having that dealflow exclusively now have to somehow become better deal pickers to maintain decent returns (since commoditizing the dealflow means valuations and terms get worse for investor as long as there is an excess supply of angel money out there)

instead of trying to become better pickers, the angelgate people are trying to find ways to maintain the old status quo on deal economics. Recently, I started thinking maybe I would stop doing deals that had convertibles in them. And indeed I did start saying no to more deals. But despite that, I still chose to do a few more deals.

the increased levels of transparency and the commoditization of dealflow make angel investing a lot more like investing in the public equity markets... the price you have to buy in may already be pumped up, the terms might not be as preferred, etc.. but IF you can pick the winners, it doesn't really matter. That's a big IF to rely on though!

So all of this just means these angels need to become more picky on what deals they will do. This will no doubt have the effect of dropping valuations a bit too, which they should like. But then again, maybe a lot of the angel funds prefer doing lots of deals because like some VCs, they are starting to like the management fees a little too much? Basically, by having lower valuations out there, the angel funds don't have to be as choosy which enables them to deploy more capital faster -> more management fees. Nice little conspiracy theory, although my friend Vu points out to me that the majority of super angels are already set financially where the management fees are not as impt to them as they might be to a younger career vc.

But honestly, I think there is nothing people can do about this. It's an increasing efficiency, not decreasing efficiency, that entrepreneurs have been raising prices... prices may have just been suppressed by the difficulty entrepreneurs used to have in identifying and meeting potential angel investors. It's basically like an auction house where all of a sudden, more people are being let in to the auction to bid. Of course prices are going to go up, so caveat emptor.

So if you want to make money as an angel, you might have to take the shittier terms and just hope you are better at picking companies... or figure out a way to add value and get in cheaper, like YC does. (It's no wonder that YC is ok with these trends since they are still taking a decent chunk of the companies BEFORE the angel rounds.. and the fact that so many YC companies don't seem to regret it indicates it is probably a fantastic model). Maybe all the angels should pool their funds and just start a YC competitor.

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If all the angel rounds are now being done at venture level valuations and scale, maybe this is a sign that angels are going to be squeezed out entirely.. Plenty of good vc firms are now willing to chip in 100-200k into startups just for what they perceive as the social obligation option value. Perhaps in a year, YC companies will just go direct to those vc's. So the new model becomes JOIN YC AND EAT RAMEN -> RAISE 500K FROM A FEW VC'S WHO DON'T MIND DOING LOTS OF SMALL NOTES FOR THE OPTION VALUE -> RAISE FULLER VENTURE ROUND. Angels might be getting squeezed out?

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One friend who is a high profile angel mentioned to me that he hates convertibles because the long term/short term capital gains clock is delayed. That is a very valid point, although who knows when LT cap gains rates are going to raise back to the same as short term, the way the country is going.

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The other thing kind of weird is that all these people who are being labeled as "angels" are actually VCs. If you are investing other people's money, you aren't an angel anymore, and especially if you are doing deals at the valuations these people are putting in at.


It will be interesting to see what happens if/when the economy and the public markets hit the shitter again though. A LOT of angels will pull out of doing deals, and things will start moving back towards the angel investor's favor (possibly just back to where this all started :) )

Disappointing.. The Amazing Race makes stuff up

One of my favorite television shows is The Amazing Race, where teams race around the world, stopping in various cities and completing tasks to move forward. In the early seasons, it was an actual race where by the end, the leading team could be days ahead of previous teams. So to up the drama on the show and make the race closer, the producers started creating bunching points at which all teams would end up together again. An example of this is when the teams all have to take a flight that is 16 hours later, giving the lagging teams time to catch up.

This has always bothered me a little, but I understand why the producers do this. But what I learned on my recent trip to Tallinn Estonia bothers me a lot more because it makes any content on the show suspect, at least as far as being a travel show.

One of the tasks teams had to perform was to, "figure out how to open this door to Mustpeade, the secret layer of the Brotherhood of Blackheads". As you can see in the video, around 10:33, there is a secret keyhole that opens the door to this "Secret Layer". Here's a screenshot from the video where a team finds the keyhole:



When we visited the building, we could find no mention of the brotherhood ever actually being a Secret. The producers made that part up to make the task seem more exciting! Furthermore, there was no hidden keyhole that opened the door, that was also made up. If you look at the picture above closely, you'll notice that the wall around the keyhole is a lot cleaner than the column to its left. So the keyhole was just created to go along with this "Secret Brotherhood" theme.

Here is a picture we took of what the place really looks like: Notice that the column around where the keyhole should be has ridges, giving ample space to put in a fake keyhole and plaster over the ridges to make the column look smooth, as it does above.



I'll keep watching the Amazing Race because it is a fun show, and in the last few years we've visited many locations we might not have otherwise (like Tallin and Dubrovnik).. But it is a bit disappointing that Hollywood has to make up history just to make the show more exciting. Then again, they made up virtually the entire Facebook movie, so I guess it's standard practice.

Is this the great flattening?

The world is flattening, and what that means is that the people who used to live on the mountains are going to lose their beautiful views while the people living in caves underground are going to finally see daylight. In other words, as the world flattens things will get better for those who were doing worse, and worse for those who were doing better. (In the super long run, technology will still make life better for all, but that is a much longer term trend)

Right now in the West we are seeing austerity packages being announced and horrible unemployment figures coming out while we are simultaneously seeing Chinese wages rising. it occurs to me.. perhaps this is all part of the great flattening. can we use the inevitability of flattening to model what is yet to happen?

Yes, China will get hit by the crisis as well since the West is their major customer, but since their starting point in all of this is pretty low, they will still continue to strengthen in the long run as they educate more of their people and move up the value chain. The great flattening in the long run is a stronger force and tells you the longer term trend.

As value shifts from the rich countries to the poorer countries, we in the west will see general deflation.. It is an inevitability as value shifts from West to East.. however as our government leaders try to fight this we will see them spend more and print ever increasing amounts of currency, ultimately leading to massive inflation. On the other flipside countries like China will see their currencies appreciate, and while that may cause some pain for them in the short to medium term, it will become less and less of an issue to them as their domestic consumption rises to replace dropping western demand for their products. This seems to fit well with the fact that their wages are rising.

The main thing I am wondering is where prices land in the US as you have simultaneous deflation of assets vs. inflation from money print. The conclusion I come to is that prices will not come down too much (in nominal terms) because the government hates deflation (it drops tax revenue) so they will keep things at least flat by printing more money. However, as the world eventually settles down, all the money they printed will lead to massive amounts of inflation. They may be able to soak up some of those dollars to reduce this effect, but that would require raising rates and slowing down growth which would be politically very hard to do. My guess is that politicians always do what get them elected in the short term and they won't do as good a job stopping inflation as they have been in stopping deflation. Net result is I see prices fairly flat until the economy starts to pick up again, at which time we are in for some serious inflation.

Anyway, just a bunch of random thoughts forced together, not sure everything I am saying is correct or even makes sense in any way.

XLB Index

I visited Shanghai for the first time in 1997. It was then that I discovered the famous "Nanxiang Xiao Long Bao Restaurant". Xiao Long Bao are commonly known in the US as soup dumplings or steamed dumplings. They are exceedingly bad for you and exceedingly delicious.

I remembered this store in particular because they were so cheap too This famous store sold 16 pieces for 4RMB (about 50 cents at the time).Then next time I visited in 2006, the prices had risen so much in 9 years that I decided to take a picture of their menu. 16 pieces now cost 8 RMB. In reality this is about 8% inflation per year, which in a fast growing place like China is not surprising.


(2006 - 16 pieces cost 8RMB)

This year prices have risen to 12 RMB per 16 pieces, or about 10.67% annualized inflation rate.

 
(2010 - 16 pieces cost 12 RMB)


The bigger realization is how much a number as small as "10%" compounds. Can you imagine what life would be like if we experienced 10% inflation in the US? I checked interest rates at local banks and they were fairly low, comparable to the US.. no wonder the equity and stock markets have been such a bubble over the last 10 years in China!! putting the money in the bank is akin to throwing it away.

My letter to Vivek Wadhwa

I recently tweeted the following:

"I disagree with almost every TC post i've ever read by Vivek Wadhwa. Financial incentives < Cultivating real interest http://tr.im/RPT3"

It looks like I was not the only one:

"@VCMike: RT @shervin: RT @rabois his posts are garbage. RT @georgezachary RT @jhong :disagree w/TC posts i've ever read by Vivek Wadhwa"

Today I got an email from Mr. Wadhwa:

"James, I cherish criticism because I always learn from this. Would love to lean what you disagree with about my posts. Here is my latest: http://techcrunch.com/2010/03/20/integrating-ethics-into-the-core-of-your-startups-why-and-how/ "

Here was my response, I thought i'd post it here on my blog too:

Hi Vivek,

Sure, I am happy to provide some feedback.

WRT to your latest post, there is not too much to disagree with the
concept that strong corporate values can help companies endure. I
think most people understand that ethical behavior leads to trust,
which is a cornerstone of sustainability. I whole heartedly agree with
the concept that companies and people should operate ethically. That
is, for example, why I was against the scamville offers
(http://techcrunch.com/2009/11/01/scamville-hotornot-plentyoffish-facebook-myspace/)

I'm not sure you successfully make that point in your article though.
The data you provide just shows that of companies that were Forbes 100
in 1917, most did not survive. Then you imply based on his statements
about which financial companies survived in 2008 that this was the
same reason for the older companies failing. But you offer no proof of
that, and you don't cite anyone's research that proves this specific
point.

The other issue I have with this article is that it's not clear the
behavior of subprime lending was unethical. Having a short term focus
and making bad loans was ultimately unsustainable and in retrospect a
bad business decision, but it is a bit of a cop out academically to
say that they are inherently unethical. Seems a bit like you are
pandering to a populist audience that presumes that the recession is
only the bank's fault and not their own as well (for borrowing in an
irresponsible manner or for having a short-term mentality themselves
when voting for politicians.)

Are people who took subprime loans unethical, or just unwise? People
adapt to the environment and the rules setup around them.. a lot of
the mess we are in I attribute more to bad public policy decisions..
but even then, I would not call Alan Greenspan unethical, I think he
just made very bad decisions.

If you had just said "these companies failed because they had short
term mentalities and didn't want to hear anything about it from their
employees" that would have been easier to digest. I think your recipe
for framing things has too many parts sensationalism and not enough
parts substantiation.

Incidentally, I do think there are things some banks have done that
have been fairly unethical. I just don't think you listed any of them.

WRT your last post, which was the debate with craig barrett, my
fundamental problem with it was that I believe that the passion and
obsessive thinking needed to make technical breakthroughs are
typically the behavior of people who are genuinely interested in their
subject matter. You can pay a person to become a scientist and do
their job, but you can't pay a person to care.. and my gut tells me
that the people who care are the good ones. If you look at history,
you will find that scientist have not traditionally been wealthy.

What motivated the team that put men on the moon was the challenge and
the glory, not the payoff. That's not to say that large prizes do not
serve as a fun incentive (ala x-prize) and focus/coordinate collective
efforts, but the root of the problem is not one of financial
incentives. Kids don't go around saying they don't like math because
there's no money in it.

If you get someone interested in a subject at an early age, they will
think about the subject whether there is money in it or not.. and in
some pretty cool cases, those people might not even care about the
money when it IS there for them, as is the case of Dr. Perelman of
Russia who recently solved one of the greatest math problems but has
shunned publicity and possibly a one million dollar prize (
http://www.nytimes.com/2010/03/21/science/21award.html)

If you believe otherwise, I'm afraid you are spending a bit too much
time with MBAs and not enough time with the people you are actually
writing about.

Best Regards,
James

Fat versus Lean Startup

Ben Horowitz wrote a good piece over at All Things D, in response to all the startups that try to go lean (keeping expenses as low as possible and raising as little money as possible too).

A lot of companies I have been involved with have faced the question of whether to go Fat or go Lean. My opinion is that, like most things, it really depends on what your goals are, and there is not one blanket answer that fits all situations. As usual, you will have to think about it.

HOTorNOT was probably one of the earliest lean companies in the post web 1.0 crash era. But that is not to say that we didn't consider whether it made sense to raise venture capital, or at the very least to start spending more of our earnings aggressively. For us, there were a lot of questions of what "going big" on HOTorNOT would have returned. We tried "getting fatter" by starting work on other non-HOTorNOT projects, but we then found that we couldn't mentally juggle so many products at the same time. In retrospect, what we should have done is invest in those projects but spin them off into separate companies (with separate offices) quickly. In those days, having capital was a distinct competitive advantage, we really missed the boat on taking advantage of that.

Going lean optimizes short term earnings, but it does so at the expense of long term growth.

All the points Ben makes are correct if there is some really big opportunity out there, provided you want to take the risks needed to capture it. If your financial goals are to only make a few million bucks but with less risk, then going lean can make a lot of sense. If this is the case, then DON'T RAISE VENTURE CAPITAL. If your goal is to create something big, to create and/or capture a huge emerging market, then you need to go big on spending (or in better terms, on investing), and probably will need venture capital to do it.

It is very possible that the markets will crash again sometime soon, and capital will become more scarce. (It's also possible that the govt will continue propping up the system and the markets won't crash, and venture will be fine.. but my personal beliefs don't lie in this camp). For this reason, I've told most of the companies that I'm involved in that if they want to go big, they should raise big now while they still can. If a crash happens, capital will again become a massive competitive advantage.

To summarize:

Want to make a nice little company that optimizes for earnings? go lean.

Want to change the world and go big? go fat.

BTW, going fat doesn't mean spending your money stupidly, you should still watch closely how your company spends its money. going fat is more about being willing to make those investments, and being willing to raise more money to do so.

Birds would do better on "Let's make a Deal" than humans!

This is very interesting! Apparently birds understand Bayes Theorem better than humans do!

via kevin lewis.

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Are birds smarter than mathematicians? Pigeons (Columba livia) perform
optimally on a version of the Monty Hall Dilemma

Walter Herbranson & Julia Schroeder
Journal of Comparative Psychology, February 2010, Pages 1-13

Abstract:
The “Monty Hall Dilemma” (MHD) is a well known probability puzzle in which a
player tries to guess which of three doors conceals a desirable prize. After
an initial choice is made, one of the remaining doors is opened, revealing
no prize. The player is then given the option of staying with their initial
guess or switching to the other unopened door. Most people opt to stay with
their initial guess, despite the fact that switching doubles the probability
of winning. A series of experiments investigated whether pigeons (Columba
livia), like most humans, would fail to maximize their expected winnings in
a version of the MHD. Birds completed multiple trials of a standard MHD,
with the three response keys in an operant chamber serving as the three
doors and access to mixed grain as the prize. Across experiments, the
probability of gaining reinforcement for switching and staying was
manipulated, and birds adjusted their probability of switching and staying
to approximate the optimal strategy. Replication of the procedure with human
participants showed that humans failed to adopt optimal strategies, even
with extensive training.

Chinese Pollution

An incredibly saddening set of photos taken of the environmental destruction taking place in China. This pollution is driven by a relentless desire for more profits, but also by my demand for new iphones, Macs, etc..

Yours too, none of us are innocent.

Take a peek: http://www.chinahush.com/2009/10/21/amazing-pictures-pollution-in-china/

I'm not quite sure how the world can reverse this cycle. For China, perhaps it will require another socialist revolution. There is also a fascinating interview of the photographer, where he points out that to most of those affected, there has been no "economic development". The spoils of this destruction have gone to the few, while the poor masses are left to suffer.

That interview can be found here: "http://www.chinahush.com/2009/11/11/interview-with-lu-guang-the-photographer-of-pollution-in-china/

What are we going to do about this? What can be done?

Hallelujah

Julian Robertson (founder of Tiger Management) talks about our economy. He gets it dead on. In order to even possibly recover, the American public needs to demand politicians for pain. Unless Americans understand that we can't have something for nothing, and the lifestyle we've become accustomed to over the last 30 years is NOT what we deserve nor is it sustainable, we and our US Dollar are going to be toast.

Unfortunately, I am not particularly optimistic about spoiled children realizing they are spoiled and asking their parents for more discipline. When does that ever happen?

What will the US be like for Asian Americans over the next 50 years?

A country's economy lies in shambles. Debt owed based on a decade or two of bad behavior have crippled the country. Unemployment reaches extreme levels never seen before, hyperinflation starts to rear its ugly head based on the government's decision to print more and more money.

Is this a description of where the US is headed? Quite possibly.

But it's also a description of the Weimar Republic, also known as Germany from post World War I through the ascension of Adolph Hitler (who unofficially but effectively ended the Weimar Republic and began the Third Reich via the passage of the Enabling Act which rendered their parliament impotent)

A nation depressed, under debt loads inconceivable of ever being paid off... and who could the Germans blame but themselves?

Aha, but that's the problem. It's almost human nature not to ever blame yourself. It's much easier to blame others, especially when your peers are doing it too. A psychological scapegoat is needed, the perfect defense mechanism. It was this energy of the people that Hitler captured so adeptly that led to his spectacular rise in power.

Anyone who has studied cults understands this, because it's the same thing. Take people who are downtrodden, likely with low self esteem. Put them together in a group. Tell them it's not their fault, it's the god damn [insert common enemy].

In the case of the Nazis, the common enemies were the Allied nations who imposed the Treaty of Versailles upon the Weimar Republic (basically made them pay back for all the damages from World War I ), and of course mixed in with that was a healthy dose of anti-semitism.

So let's say the US economy does collapse further. (Some people believe we have recovered. Others believe the current recovery is not real and point to the fact that the stock market recovered by similar amounts during the Great Depression just before the second wave hit. In either case, for this scenario, let's presume that things do get worse.) There are a lot of arguments being made that inflation, and perhaps hyperinflation, are down the road for the US. Regardless of the inflation/deflation argument, it is hard to argue with the fact that unemployment is at an extremely high level right now, and it is still increasing.

This leads to a POTENTIAL scenario that the general mood in the US will match that of Weimar Republic citizens. At that point, all that is needed is an extremist leader who is willing to point fingers at an appropriate common enemy...

... and who is the most likely common enemy going to be? Take a look at this video:




This video is not about Asians, but rather about the United States Debt Crisis... but with the mention of China in the pledge and the focus on China when the person says the US owes money to "Foreign Governments", it's not hard to figure out who the best common enemy is going to be. Of course, it's going to be the people we owe money to, and more importantly, to the people who are doing well in the face of us not doing well.

Of course, the Chinese can hardly be blamed for our bad behavior right? Even if that's true, at some point in time the Chinese have made it fairly clear that they would like to see the US Dollar not be the world reserve currency anymore. They are already shifting their reserves away from the dollar (in relative terms, not yet absolute). Some day, they may drop what they themselves refer to as "the nuclear option" by basically abandoning the US Dollar completely in a move to make the Chinese RenMinBi the world's reserve currency.

Keep in mind, I am not saying that this scenario is likely, but it is definitely a possibility... and that action would only make it easier to blame the Chinese.

I am reminded of the stories I read in the late 80's and early 90's about anti-Japanese violence in the midwest. That was when American jobs in the car factories really started getting lost to the Japanese, and movies like Gung Ho started coming out. As an Asian American growing up in those days, the attempts to ridicule and emasculate asian males were quite obvious. Goodbye Bruce Lee, Hello Long Duk Dong.

If this scenario plays out, there's a chance that the United States is not going to feel like a very welcoming melting pot for Asians. In a country that has a history of racism, and policies that were entirely race based (Japanese Internment Camps, harsh anti-immigration laws targeting asians, slavery), it's not hard to imagine a bleak future for my son. The Japanese internment camps were less than 70 years ago. And I was shocked to hear a neighbor of mine make a subtly racist comment a few days ago, which led me to the realization that she was probably 20 years old in the 1960's.. which means she grew up in a country fraught with racist attitudes. Somehow, living in San Francisco had made me somewhat oblivious to racism. It was saddening to have that veil lifted.

A massive amount of value and jobs created by companies founded or cofounded by immigrants in this country (for example: Google, Paypal, Intel, eBay, Nvidia, and Yahoo.. and before you start saying it is a recent tech phenomenon, let me also mention Dupont, Proctor and Gamble, Pfizer, and US Steel). Making things hard for immigrants in the US may lead to a negative feedback loop where fewer immigrants leads to less innovation and fewer jobs created, which in turn increases racism, which leads to fewer immigrants, [REPEAT].

So as I prepare to go on my year long trip around the world, the way in which I view my trip has taken an added dimension. Unfortunately, I'm no longer just going abroad to see what life is like in other countries, I'm also contingency planning an escape route.

I was born in this country and love being here, so I really hope this scenario is wrong.. I think the odds of things playing out this way are low, but it is clearly not impossible.

The J3 World Domination Tour

I somehow managed to convince Julia not to go back to her job post-maternity leave and instead plan a year long trip living in various cities around the world.

The thinking is that it'll be hard to do this sort of thing as Jackson and any future kids get older, and hey, you only live once.. and life is short... and any other cliched rationalization we can think of :)

The places we are visiting are a little bit more tame than we would have preferred, but we had to incorporate the fact that we will be traveling with a baby! Here is our current itinerary:

NY: Oct 1 - Nov 27
Sydney: Nov 29 - Jan 22
New Zealand: Jan 22 - Feb 13
Singapore: Feb 13 - April 8
Hong Kong: April 8 - April 11
TaIpei and Penghu: April 11 - April 21
Shanghai: April 21 - May 15
Barcelona: May 15 - June 26
TBD: June 26 - July 13
Amsterdam: July 13 - Sept 7
TBD: Sept 7 - ?

The schedule is subject to change, especially for the European portion.. subject to weather, how we are feeling, and any wild swings in the the Euro-Dollar exchange rate! The around the world ticket that we bought actually starts on the Sydney leg, so we can technically extend our trip until November 26 I think.

We are hoping that friends show up and visit, so do not disappoint us! Some friends we expect to see more now that we are joining their jet-set lifestyles.. You know who you are!! :P

We're gonna post updates of the trip at http://world.jhong.org

More on Happiness

A couple of years ago, I wrote a short blog post about happiness where I said that happiness = reality - expectations. My basic point was that as long as you have low expectations from things, you are more bound to be pleasantly surprised (and happy) than disappointed.

There's a fascinating piece in The Atlantic about a Harvard study that has been going for 72 years now, following the lives of 200+ men. The paper talks a bit about what variables made for happier people. Below is a short clip of the current leader of the study (for 42 years). I highly recommend people watch it and read the article!

I've been wanting Photo Phonebook for a while

Thanks to Jeremy Liew for connecting me to the kids that run a small iphone app shop called Zintin.

I came to them with an idea for an app that i've always wanted. It is basically an app that sucks photos from a centralized directory (and also from facebook) to my phone.. I always liked having my friend's photos show up when they call, but I am too lazy to take their pictures and set it up for each and every contact I have. This app scrapes around to get their pictures for me.

Now I have about 40% of my contacts with pictures in a few minutes.

If you have an iphone, please try it out:

http://bit.ly/1agJu5

and if you like it, please retweet my twitter about it!

http://twitter.com/jhong/statuses/1250326351

My economic projections

I had breakfast with my friend Jeremy Liew this morning, and he mentioned I don't really blog anymore. It seems to me that services like Facebook and Twitter are growing at the expense of blogs because most things i write in my blog could probably be reduced to 140 characters, and that is just plain easier.

In the interest of blogging something meaningful, I've decided to write about what's been on my mind nonstop since selling HOTorNOT in February 2008.. the economy.

I liquidated the majority of my equity holdings last Summer and have been in a cash position ever since. So as the market continues to tank, I should be feeling good, right? Wrong. I've been worried sick that the American Dollar is going to collapse and that cash may be rendered worthless. My fear has grown to the point where even if I have an opinion on what to do, I'm too scared to do it. Deer-in-headlights mode.

Last December, I tried to encourage myself to man up by writing down my investment thesis on paper and stuck it on the wall. Unfortunately, even going to this length didn't change my behavior, and I'm still all cash. But here is what I wrote:



My theory was that we would experience three stages: Deflation, Transition, (Hyper?)Inflation

Stage 1 - Deflation

The economy is still contracting has deleveraging continues to happen. The entire world starts to feel the full impact of increasingly lost jobs, people tightening up their pocketbooks, and mortgages defaulting (at all price levels and in all locations.. and no, San Francisco City is not "special" or "different", just like real estate is NOT always a good investment in the long run.).

As all of this happens, industry slows, commodity prices fall, energy prices fall, and the pains of recession start to be felt. Basically everything falls with a few exceptions like gold, where people who are pulling out of the market flee to for safety. I was actually wrong on this one, I had gold going sideways because i wasn't sure whether downward pressure from economic slowdown or upward pressure from flight to safety would be stronger. It looks like right now, gold is going up up up. Sure wish I'd bought some.

The rest of the world falls too, as their economies are so linked to Western consumption.

Stage 2 - Transisition

As my theory progresses, it gets more controversial. I call this stage "transition" because this is where the balance of power between first world countries and certain second/third world countries shifts.

Ever wonder how empires fall and how other's rise? Like how Spain and Portugal used to be the most powerful nations in the western world, and where are they now, relatively? It happens through dislocations like the one we are having now.

My theory is that as stage 1 starts to end, the world economy starts to pick up. consumption starts picking up. The only problem is that it won't happen uniformly. People in China will start buying more stuff (from themselves), and their economy will start growing like crazy as a result.

In other words, the recovery happens, but mostly in other countries, as their economies have decoupled from ours and they start driving their own demand. In this scenario, commodities and energy prices rise (and will surpass previous highs, including oil), Gold also rises. US equities don't drop anymore, and they might even start growing again, but not at the same rate the rest of world is. (keep in mind, china is still growing even now, just not as fast as they were before. in contrast, the US has been contracting like crazy.)


Stage 3 - (hyper?)inflation

Here's where the scary part comes.

As energy prices jump, but not based on US demand, the cost of energy massively outpaces our ability to afford it. The price of energy is embedded in practically everything you buy, through it's use to process raw goods to powering factories to transporting goods. All of a sudden, things start getting REALLY expensive. The dollar is severely weakened. In order to respond, the government may or may not start printing money like crazy, at levels well beyond what they are doing today. (Despite Monetary and Fiscal policy supposedly being independent in the US, in tough times boundaries tend to break down).

Maybe we don't have Zimbabwean levels of inflation, but maybe we see just a 10x drop in the value of the dollar. In US dollars, things like oil and gold shoot through the roof.

Some people claim that they do not believe it's even possible for the US to experience hyperinflation. Of course, many of them thought the US economy was sound just one year ago. I've been doing a lot of thinking about this, and I haven't really reached any conclusions.

I don't think it's impossible, the question is just how likely?

What I do know is this.. I can ignore stage 1 and stage 2, but if stage 3 happens, anyone with significant assets that fails to protect him/herself is going to really regret it.

I'm very interested to hear what other people's thoughts are.

update: Heard back from some people, and want to clarify a few things. The timespan in which I see this potentially happening is on the order of decades, not years. I think we are going to be in stage 1 for at least 2-3 if not 5 years. Step 3 also doesn't happen unless the dollar stops being the de facto global currency. Some other currency like the Chinese Yuan would have to take over that role first. Until that happens, I don't see hyperinflation happening in the US.

Back Pain

I've been having back pain for the last 2.5 years. It started out as a case of sciatica with the pain shooting down might right leg, but that seemed to heal after 4 or 5 months. But even after the sciatic pain went away, i've been experiencing general back pain ever since.

I've tried everything.. Stretching seemed to help a bit, but not a lot. I bought some device called the sacro wedgy that didn't really do too much for me.

Julia recently bought me a book she heard about called "8 steps to a pain free back

This book makes the point that there are many cultures in the world where back pain is not a problem for 95% of the population, regardless of age. The culprit? According to the book, the problem is bad posture. This seems feasible, as I recall my mom complaining about my posture my entire life.

So lately I've started working on my posture and have been doing some of the stretches in the book, which primarily seem to be about decompressing the spine, and I have to admit that I have been feeling a lot better in just a few days. We'll see if that continues or not, but in any case, just thought I'd write about this in case anyone else has chronic back pain. I highly recommend checking out the book.

Here's a talk the author gave at Google last year too, followed by an excerpt from her book.




No more back pain

Publish at Scribd or explore others: Health & Medicine Health & Medicine exercise pain

Stephen Fowler is NOT representative of people in San Francisco

I just watched an episode of Wifeswap that has gotten a lot of attention recently.

There's a horrible person in Noe Valley named Stephen Fowler who is obnoxious, snotty, mean, and rude beyond imagination.

I really hope people don't watch this show and think this guy is typical for San Francisco. Even here, he's a serious asshole.

And to the Fowlers, as someone who also got an MBA (and spent some time at your alma mater London Business School), let me be the first to tell you that an MBA is hardly an "advanced degree".

Apparently he is a venture partner at some fund called the Fulcrum Fund.

UPDATE: I had videos from YouTube on here, but apparently the production company and ABC had them taken down. Perfect chance to show people clips of their show to grow awareness and interest, and instead they idiotically take it down. Sometimes I wonder if these old media companies realize how shortsighted they and how badly they are shooting themselves in the foot.

There's a blog dedicated to explaining why the dude is a douchebag

Wow...

Would love to have all the people slamming this dude in the video watch this and see what they have to say now.

This one never gets old..

It's Big Game week, the week of the year where Cal fans like to rub this video in Stanford's face. Thanks to Youtube, this is now done much easier.

This particular video has the minute of play just prior to The Play, with Elway's spectacular scoring drive that begins with Stanford on the 13 yard line, 4th and 17. Seeing what happened prior to The Play increases the intensity of emotion you experience compared to just watching The Play by itself. If you've only seen the Big Play clip standalone and have never seen Stanford's drive leading up to it, I encourage you to watch this! The second video is the play digitally enhanced so you can see it clearer.

Not that I am the school spirit rah rah type, but.. Go Bears! :)



Just The Play, in enhanced quality:

Oh my god, this is funny

You can click on the picture to make it bigger.

blah blah blah

It’s been a long time since I blogged anything meaningful. When I first started this blog, it was primarily for HOTorNOT communication. Once we sold HOTorNOT, I didn’t really have anything to write about. Truth is, I’m not sure anyone even reads this blog anymore since I moved it off of HOTorNOT’s servers and to a different address. If this post seems less coherent than previous ones, it's because I used to write and rewrite and rewrite. For this one I am just writing rants in a cafe.

Anyhow, this morning I loafed around in bed, doing emails and watching the stock market obsessively. By the time I got out of my pajamas around 2pm, I started feeling a bit bad that I’m not really doing anything (but really, why do we all feel pressure to be productive all the time anyway?), I decided I would at least update my blog today.

Since this is a bit forced, I have no particular topic, but just a bunch of random assorted thoughts and announcements.

1. I’m engaged!

Yes it's true. The last of the 2 HOTorNOT guys has finally found true love. I finally have something to put on this domain.

2. Palin

Come on.. SERIOUSLY?!?!?!

The most depressing thing about her interviews with Couric is that if you watch them side by side with Tina Fey’s parody, after a while you can’t really tell which one is the joke. I guess they both are.

Couric couldn’t get any straight answers out of Palin, not even what sorts of materials she reads to learn about foreign policy. “You know, I have lots of sources that I read. Yea, but which one specifically? Yea, well, umm, you know, there are lots of sources out there to read blah blah blah”

Not that all politicians don’t evade the most basic of questions, but for God’s sake, show me that you’re smart by at least doing it well.
And I thought W was oblivious!

3. The Economy / Bailout

The first thing I have to say Is that I’m amazed the guy charged with fixing this issue (Paulson) is one of the guys who helped create the problem. Paulson is reportedly worth over $500MM, and he certainly profited from the regulations that got us where we are today.

Ideologically, I don’t like the idea of a bailout. But I also understand that if there is no bailout, the economy might collapse faster and harder than we can deal with. I agree that we need to do things to slowly ramp things down to avoid massive shocks, but we can’t put a bandaid on things and hope to just go back to business as usual either.

Our economy is fundamentally in trouble right now because we Americans have gotten fat and lazy. Over the past few decades, banks and other credit lenders have had every incentive to get people to spend more and owe more. When deregulation happened that enabled the credit originators to securitize debt and sell the risk to someone else, the credit originators had even more incentive to SELL SELL SELL credit cards, mortgages, etc.. to you and me, the American public.

The worst part of it all is that not only did we collectively sign up for more and more credit, we got used to it. And now like a salesman with a large expense account who just got fired, we have to live with the fact that all we can REALLY afford is ramen.

To be honest, part of me feels that a depression is exactly what this country needs. . because just like a drug addict who has to go through withdrawal the hard way before becoming well again, we can’t expect things to be easy. We’ve been living large for decades now, and unfortunately it’s time to pay the piper. But don’t worry, it’ll be just the wakeup call we need. We’ll wake up poor, start working hard and smart again, and rebuild ourselves. We’ve done it before, we’ll do it again.
So accept the bailout, but accept the fact that our markets are also still probably inflated and let it drop, and depression may be headed our way no matter what.. because bailout or not, I don’t see credit loosening anytime soon.

4. Why it can be GOOD being an entrepreneur in a shitty economy

So the economy is going to get shittier, and housing has only just begun to crash. (In reality, If you look at housing prices outside the top 20 MSAs, I think median housing prices may have actually have risen over the last year.. so in many cases, it has not even begun to crash, but trust me, it will)

Must be a crappy time to be an entrepreneur, right? Charles Cooper seems to think so, in his latest article about how the Freemium model must be in trouble.

With all due respect, because I have been reading him for a long time and respect his writing very much, I think Charles is missing something here. Most of the cool companies that made a lot of money out the ashes of the last dotcom crash, many of them relying on freemium models, were never on the edge of not making payroll. They were all flush with cash in fact. Why?

A. He makes the statement that “The idea is predicated on the assumption that you'll be around long enough to collect”. Is this true? No. Most people who convert on the web through freemium models convert quickly. The vast majority of HOTorNOT users who ended up paying paid within heir first week. In other words, most models that work on the web work quickly. And when you are starting at zero, it doesn’t matter if the economy is crap.. when you are starting at zero and have nothing to protect, any compelling model looks and feels good. And if you have a good model, because costs are so low, it won’t be long before you are able to hire and pay your employees.. with CASHFLOW, not funding.

B. Startups in a downturn are run a lot more efficiently. You don’t have to hire designers turned coders whose definition of coding is HTML, CSS, and a tad of javascript, for $150,000 a year. No, instead you can hire top CS grads from Stanford and Berkeley for $75k. Half the cost, 5x the productivity. (note: you don’t have to go to school to be a good coder, and going to a good school doesn’t mean you’re a good coder. Interview and test all types rigorously). And this is even if they hire at all.

The smart startups will start small, perhaps never hiring anyone at all until they are profitable and able to afford employees. In a nutshell, Charles is wrong because he presumes the traditional, increasingly outdated way of starting a company: raising institutional money and hiring lots of people, then hoping to have enough money to pay them. In a world where computing and network resources are increasingly cheap , and where the only REAL cost is that of the programmer, 3 guys in a dorm room can do a LOT… and they can probably do it faster and better than the well funded startup trying to do the same thing.

C. In a downturn, smart startups either raise a SHITLOAD of cash to weather the storm and buy other, undervalued, desperate startups on the cheap (Slide, Ning, etc..), or they raise nothing and grow off cashflow. Or sell.

The truth is, it’s never a bad time to be an entrepreneur, but it’s often easier when times are bad, if you can handle the pain of eating ramen and keeping your personal expenses at a minimum (which is why I also think the best time to start a startup is when you are 21, not 41).

Hiring is cheaper, office space is cheaper, everything is cheaper. Employees don’t get pissed off because you decided not to stock “microkitchens” with Odwalla, and when you DO stock them, they actually appreciate it and think of it as a perk, not a privilege. And best of all, there are fewer competitors, meaning less noise. .. and by the time things turn around and people start wanting to invest again, guess who will already have been doing it for the last 3 years?

So if you recently graduated from college and might lose your job, or maybe you were never able to find one to begin with.. instead of continuing looking, maybe you can figure out a way to spend the next few years eating ramen with a couple of buddies and going for it. You are maximizing your chance of success by doing it now not later.. and even if your venture does fail, I promise you, you’ll have the time of your life.


Find the Perfect Engagement Ring !

Does your iphone take FOREVER to sync/backup?

Mine was too.. i searched around the web and found this.. worked like a charm! Enjoy :)

http://www.hackint0sh.org/forum/showthread.php?p=340389

"Extraordinary long backups are caused by an error when an app (or apps) was installed or updated, particularly if you have ever installed or updated using the App Store on the device itself rather than iTunes. Even if you were never aware that there was a problem, they can arise and will cause problems with the backup process. Maybe you did have a problem during an update or install. Maybe the update stalled, or the App Store crashed. These issues are very likely what have been causing your long backups and you didn't even know it. During the backup process these errors cause it to drag and pause for a very long time before it gets moving again. From your view, you just see a normal backup that is taking hours, and undoubtedly annoying you to no end. On the inside, iTunes is trying desperately to get past a roadblock that it doesn't know where it came from.

This is how to fix the problem. This is not a quick fix, but it is an effective fix. And it is a FIX, not a band aid. Depending on how many apps you have installed, this can take several hours to complete. You will also lose all game scores and any other data stored in your apps. You will be starting fresh. It is an inconvenience, but in the end, you will be rewarded with quick, efficient backups, the way Apple intended. And you will never have to dread the
iTunes backup again.

The Process:

1. Open iTunes, go to Edit>Preferences>Syncing and remove all previous backups. Also click "Disable automatic syncing for all iPhones and iPods"

2. In your system file structure, locate the backup files for iTunes.
On Windows: C:\Documents and Settings\USERNAME\Application Data\Apple Computer\MobileSync\Backup
On a Mac: Users/YOURACCOUNT/Library/Application Support/MobileSync/Backup
Delete ALL files and folders inside the Backup folder.

3. Plug in iPod. On the Applications tab, uncheck sync apps. iTunes will ask if you want to remove the apps from the iPod, say yes. Click sync. This will remove all apps on your iPod, it will also backup the ipod. This backup will be very fast, and will recreate the backup folders you deleted in step 2.

4. After the sync is complete, if there are any apps left on your ipod, touch and hold the icon until it starts to wiggle, then touch the X to delete the app. Delete all apps left on your ipod. Then sync again.

5. After the sync is complete, disconnect the iPod and do a hard restart by holding down the sleep/power button until the slider appears, slide to power off. Wait 5 seconds and push the power button again and wait for the ipod to boot up.

6. Connect your iPod again. Now begin adding apps back to your ipod one by one. On the Applications tab, click "Sync applications" AND "Selected applications". Make sure all apps are unchecked.

7. Check one app and sync. After the sync is complete, right click on your ipod under Devices in the left column of iTunes. Click "Back Up" and allow the backup to complete.

8. Repeat step 7 for each app you want to install. Keep the previous installed apps checked, just check one more app each time. Be sure to backup after each install. As you add more and more apps, the backup will take longer and longer as the process scans apps for changes. An initial backup can also be long for a particularly large application. However, ONLY the initial backup after you install an app will take a long time. Subsequent backups are very quick. Even these "long" backups are just minutes long, sometimes up to 15 minutes in my experience.

9. When you are finished installing and backing up all apps, go to Edit>Preferences>Syncing and enable automatic syncing for all iPhones and iPods.

10. Unplug and plug your device back in just for kicks. Let it back up and sync. Better?

Notes:

The very first time an application is backed up, all critical data is written to your hard drive. This is why the backups are so long the first time. Afterward, only data changes are written, so backups are much shorter.

Backup times will continue to vary based on how many apps were altered since the last sync. If you've used one app since the last backup, your backup will be very short. If you've used 20 apps, the backup will be longer. But you will be rid of the dreaded hour (or more) long backup, that is a promise.

Now that your apps are installed and backing up correctly, the number one rule is to never, ever install or update apps through the App Store on the iPod. ONLY install and update through iTunes, and backup after every install or update. The App Store on the iPod is still unstable and can cause lock ups, crashes and freezes. And it is the culprit in these long backup times. Avoid it until the bugs are ironed out.

Also, do not be tempted to disable backups using programs or code edits available online. Your backups are crucial in the event of a restore. Backups contain all of your personal data like game scores, notes, icon arrangement, application data, etc. And it's not a matter of if you'll have to restore one day, it's when, and you'll be glad you have a backup when you do."

ok.. SO AWESOME!

All my friends know how much I absolutely love karaoke.. I've been wanting to get a system at home for years, but figuring out the right software, hardware setup, and buying (bit-torrenting?) all the songs seemed like to much of a pain in the ass... so it just never happened.

Julia and I upgraded yesterday from an old school 26" CRT TV to a monstrous 52" LCD display.. This thing is HUGE in our living room. I hooked it up to my laptop and tried out a new online Karaoke service called The Karaoke Channel.

Voila, Instant karoke in my living room with a pretty large selection of songs.

SOOO AWESOME!! :)

Olympic Torch Run

Julia worked in the city today, so she came home for lunch. As we were driving her back, we hit a road block.. Apparently they changed the route for the Olympic torch run, and decided to start it around Van Ness and Jackson.. which is exactly where we happened to be!

Noticably absent were any protesters, with the exception of one woman next to me yelling "Free Tibet". I guess most people were hanging out on the originally planned route along the embarcadero. Apparently, they had the person holding the torch go into some building on folsom, and people waited for her to come out, and the next thing you know she is halfway across town on van ness. how'd they get her out, did they dig a secret underground tunnel or something?? Gavin Newsom is a clever one!

I love how the red boat/car is named "Peking Duck" :)

So long HOTorNOT, and thanks for all the fish!

It was reported yesterday on Techcrunch that Jim and I sold HOTorNOT. I wasn’t originally going to make a big deal about the acquisition, preferring to go gently into that good night, but a lot of people have been asking questions so I thought I would kind of make an announcement here.

Mike actually got the exact size of the deal wrong, but he was correct that the deal closed on February 8. Where Mike Arrington gets his information I will never know, but man is that guy plugged in!!!

The private investors that bought us out intend to hire up and grow the HOTorNOT brand... basically to do all the things that Jim and I dreamed of doing, but never managed to organize and do! We would love to see HOTorNOT grow to epic proportion, and we are confident that it is in better hands with these guys!

If you run a company that is cashflow positive and may be synergistic with HOTorNOT, and are interested in being acquired, you should definitely contact them! You can see their contact info on their Hot or Not Media website.

I can’t speak for Jim, but he seems to be just as happy as I am about this deal. HOTorNOT was an insanely fun thing for us to create, and we are extremely proud of building a company of its size without ever taking any funding (back when a Megabit/second cost $1,000 a month!). To us, it is yet another example of the ultimate bootstrap, and we hope our story serves as an inspiration for all the entrepreneurs out there who are in the same spot we were in: totally broke and inexperienced, but with a good idea and the energy to start something new.

But all good things must come to an end. Eight years is a long time, and both Jim and I were mentally prepared to move on years ago. With our waning interest, it seemed like the right thing to do was put the company in the hands of capable people who are excited about it and want to take it to the next level. That would also better enable us to move on and focus on other things.

So since I have all this free time now, people have been asking me “what’s next”?

I’ve been just telling people that I’m busy actively helping out various companies I’ve invested in… but to be honest, the truth is that most of them are already doing well and don’t need my help (but everyone be sure to check out my friend Dennis "Thresh" Fong unveil his new company at GDC, next Friday at noon!)

The truth is I have no idea what I’m doing next. While my best friend Max is known for his large scale ambitions with Slide, I am content sitting at a café all day peoplewatching. As far as I know, I have no current plans to start an incubator or become a VC or anything… the only plans I have so far are to hit Vegas next weekend :)

The one thing I DO know is that after 8 years of HOTorNOT, I'm VERY ready for an extended summer vacation :)

G-Bell has a nice ring to it

what i am about to say is probably obvious to everyone but me, but this morning something occured to me. I might be completely wrong, but:

I was reading the news about google's spectrum bid, and started thinking about it. Many people I have talked to have said "sure they know how to run a million computers, but does google know how to run a phone company?"

Well, it's not clear to me that google sees the 2 as being that different, and I think they would be mostly right. It's not clear to me that if google won, they would start putting up a phone network. They might instead start by just putting up a data-only network, and then start fulfilling phone services using VOIP a bit later.

The spectrum would allow them to set up full nationwide data coverage in the 700 Mhz band. ok, so lets say they do that and now the US has free wifi (protocol TBD).

ok, then you start working with handset manufacturers to start putting out phones that work in the A/B bands (the current cell phone infrastructure)AND the C Band. Now you have a phone that works with your existing carrier, but when you want to access the web from it, it switches to their C band, and you save money. Free, fast web access that you don't have to pay for. seems like a slam dunk in terms of getting users.

ok, now add VOIP, and you can start making outgoing calls over their C band and drop your normal carrier if you want.

But it's still a pain to manually tell your phone to call over some VOIP network versus over the normal phone network, right? what you want is to hit the "dial steve" button just as you normally do today, and have it just work. well, in order to achieve that, it sure would be useful if Google helped create intelligent contact management software for your phone such that when you call someone and you happened to have Google connectivity, the call got routed over their network automatically. If you don't have google connectivity, then it might just default to using your normal phone carrier for that call. But how would Google get this capability into people's phones if they don't manufacture phones themselves? Answer: Android.

For receiving calls, all they need to do is give you a new phone number that can connect to you on the normal phone system AND over VOIP. So basically, the idea is.. you have 1 normal phone number, and that number can reach you whether by forwarding to your usual phone number, or by VOIP directly to you over the google network. Right now, GrandCentral only connects you to other normal phone numbers, but it would be trivial to have it bridge a VOIP connection. How convenient that Google bought GrandCentral last year!

In a nutshell.. "all" google needs to do is:

1. get spectrum and deploy WIFI over it

2. get android onto phones to better control contact management and call routing, to make call routing between the different networks seamless from the user standpoint

3. have grandcentral ready to scale for anyone signing up, to act as a bridge between their network and the POTS network, making call routing seamless from the other caller standpoint.

Of course, these are all big hard steps, but nobody ever said changing the world was easy. Even knowing this plan, I'm not sure what the carriers can do to stop it besides their usual regulation/lobbying games.

as more people are setup on this, everyone will eventually drop their normal phone carrier and get free phone and data access from Google... but the most beautiful part of this plan is that not everyone has to switch at once, because it interoperates smoothly with the existing network. Also elegant is that because the plan presumes that people will maintain their existing carrier for a while as the world transitions to their network (use it when you got it), it means their network doesn't have to be 100% deployed or necessarily high quality all the time from day 1, like the normal phone carriers had to be when they first deployed. They can also make it so if it detects you are moving fast when placing the call, it defaults to the normal phone carrier, until Google's network coverage is 100%. (Note to google: start working on a wifi protocol that handles handoffs more smoothly than 802.11!)

Over time though, i'm sure the word of "free cell phone" will spread. Free is pretty damn compelling.. and that might spell GAME OVER for the big wireless carriers.

I know this was probably obvious to most people already, but i just wanted to write my thoughts down on this one.

I've moved my blog to a new URL

the new address is http://blog.jhong.org

please make a note of it.

[beep!]


(apache keeps dying on my james.hotornot.com machine, and i'm too lazy to continue restarting it all the time or write a cron job to do it. plus, i presume running on blogger/google's servers leads to a faster site than serving it myself.)

if you subscribed to my blog via feedburner you should be ok. if you subscribed directly to james.hotornot.com, you might need to change your subscription. the feedburner feed to use is, as always: http://feeds.feedburner.com/jhong

Interesting opportunity

My friend is moving on from his gig as Jet Li's assistant. Interesting position as Jet seems to utilize his assistant in meaningful ways. If I know you (or we know someone in common) and if you fit the qualifications, i can forward cover letter/resume.


Area of Focus:
film, non-profit (in order of work priority)

Location: Based in Asia

Job Description:
You are invited to explore the opportunity to learn and work with high level Chinese celebrity/philanthropist and learn the inner workings of the film industry in both the United States and China. The majority of work will involve hands-on involvement in building a world-class foundation from the grounds up. This will involve meetings with numerous high-level business and government officials to build and develop philanthropy in China and on a worldwide basis.

Employee will perform all the usual and customary duties of a personal assistant, including, but not limited to, review and respond to correspondence; scheduling appointments; translation of conversations and correspondence; organizing personal matters; and other duties that may be assigned.

Please visit one-foundation.com to better understand the world of this high level Chinese celebrity/philanthropist.

Desired qualifications:
-Fluent in Mandarin Chinese and English
-Degree from top-tier university with high GPA
-At least 2 years of work experience in consulting, banking, a large multinational, studio or equivalent experience
-Strong attention to detail
-Strong analytical ability
-Ability to follow through with projects and follow instructions as given
-Ability to travel frequently (50%)