Alok Sama > Quotes

“In his classic Only the Paranoid Survive, Intel founder Andy Grove describes the moment every leader dreads, when massive change occurs and a company must either transform or fall by the wayside. For Zuckerberg, this “strategic inflection point” came when TikTok overtook Facebook and Instagram in user engagement, forcing him to rename his company and leap into the metaverse.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Biceps are the male cleavage”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“No matter how old you are, your childhood dies with your parents.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Harry Markowitz won a Nobel Prize for the insight that diversification is the only free lunch in the investment business. However, if all investments are in tech, much of the benefit of diversification is lost since tech valuations are correlated. For early-stage companies, profits are in the distant future, and therefore valuations are sensitive to interest rates. Shifting sentiment plays a role, and frequently both market psychology and monetary policy are factors, creating boom/bust cycles such as the internet bubble of 1999–2000 and the more recent recalibration of tech in 2022. There is a frequently overlooked temporal dimension to diversification. Other things being equal, a fund that invests $100 million a year over ten years is less risky than a fund that invests $500 million a year over two years. The former fund will likely invest across market cycles, which should lead to a lower volatility of outcomes, even if both funds make an identical number of investments with a similar risk profile.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Control? This is the grand illusion. I can barely control my bladder. Money doesn’t give you control, it buys you a nicer coat.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Does every moon have a dark side? Or are some moons all dark but occasionally and brilliantly illuminated by starlight?”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Ten days later, speaking on Kara Swisher’s Recode Decode podcast, the influential venture capitalist Bill Gurley voiced concern about a bubble.6 Gurley had attended an investor conference in Las Vegas where he heard five of eight unicorns talk about “trillions” in their presentations. “We have done something in the ecosystem to encourage this type of outlandish promotion, where you need to use words like ‘trillion,’” Gurley said. “And I think it’s dangerous. When we act like we have the right to disrupt everything or eat every industry, we look like entitled brats,” he continued.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“For the Valley establishment, the creation of the Vision Fund was like that alien, menacing, and transformative Space Odyssey monolith materializing on the divide in Sand Hill Road. From 2013 to 2023, the market value of all unicorns would skyrocket from $100 billion to $5 trillion.31 To remain a player in this ocean of liquidity, Sequoia, like everyone else, needed a bigger boat. This would be Masa Son’s enduring legacy. A billion dollars wasn’t cool anymore. You know what was cool? A hundred billion dollars.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“The fate of Yahoo!, its business eventually sold to bottom-fisher Apollo in 2023, is the ultimate case study in a truth universally unacknowledged in the Valley—savvy deal jocks create as much value as coder tech bros.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“This may seem trivial, but one of my lessons—personal and macro—from the 2008 financial crisis is that while the absolute level of risk is always significant, the rate at which risk is accumulated is a better predictor of systemic risk.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Well, the internet business model for me was all about platforms with theoretically infinite reach at zero variable cost,” he said, and repeated for emphasis. “Infinite reach. Zero variable cost.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Barack Obama says that “every man is trying to live up to his father’s expectations or make up for their father’s mistakes.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“But the questions not asked screamed out the loudest. Nobody brought up inflated tech valuations or risk management. Nobody seemed concerned about the tenuous economics of ridesharing. SoftBank’s $4.4 billion WeWork deal was the largest slug of capital ever committed to a start-up, but nobody asked what WeWork had to do with technology. Because nobody asks tough questions in a bull market.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“I invited him to sit on the creamy mohair velvet couch, across from the Georgian marble fireplace, above it Matthieu Ricard’s Tibetan Monk in Meditation self-portrait, next to it an upholstered gray boucle armchair, perfect for that afternoon siesta bankers of a different era might have enjoyed after a leisurely claret lunch.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Big tech avoids leverage the way DiCaprio shuns women over twenty five.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble

“Biceps are the male cleavage.”
― Alok Sama

“In my world, the only reason people examine their lives is to figure out ways to make more money.”
― Alok Sama, The Money Trap: Lost Illusions Inside the Tech Bubble