Welcome to The Nightcrawler, a weekly collection of thought-provoking articles and analysis on technology, innovation, and long-term investing. The Nightcrawler is published every Friday evening by Eric Markowitz, a partner at Nightview Capital and the firm’s Director of Research. Follow him on X. 

In this evening’s email…

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Quote of the week:  “Value your time. It is all you have.” — Naval Ravikant

The AI manifesto from a Silicon Valley legend

Vinod Khosla has seen dozens of technology disruptions over his 40+ year career as a technology founder and investor. But AI, argues, is different.  “I’ve seen technology reshape our world repeatedly,” Khosla—the billionaire co-founder of Sun Microsystems—writes in a recent long-form manifesto on AI. “Artificial intelligence is different… AI amplifies and multiplies the human brain, much like steam engines once amplified muscle power.”

What I appreciate about the piece is his attempt to contextualize the hype—and fear—that surrounds AI. And beyond simply conveying the profound social and economic changes ahead, his primary motivation in writing the piece, he says, is to “dispel the dystopian vision of an AI-first world.” He continues:

• Key quote: “First and foremost, it is a cognitively lazy vision – easy to fall into and lacking all imagination: large-scale job losses, the rich getting richer, the devaluation of intellectual expertise as well as physical work, and the loss of human creativity all in service of our AI overlords. On the contrary, AI can provide near free AI tutors to every child on the planet and near free AI physician expertise to everyone on the planet. Virtually every kind of expertise will be near free from oncologists to structural engineers, software engineers to product designers and chip designers and scientists all fall into this camp. It will also help control plasma in fusion reactors and self flying aircraft, self-driving cars and public transit making all substantially more affordable and accessible by all.” 

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Get an investment edge through “strategic reading”

Alix Pasquet—a former professional backgammon player turned hedge fund manager—published a smart presentation this week on what he calls “strategic reading.”

The decline of reading books has become a problem, he says. But it’s also creating an opportunity for people that don’t just read excessively—but read strategically in choosing what (and how) to read things. Reading, Alix says, also creates leverage: it can improve your network, it can make you money, and perhaps most importantly, it teaches you how to communicate. “Remember, he says, “it’s those that communicate well that are given positions of responsibility.”

• Key quote: “Young people today don’t read as much, which is becoming a problem. It used to be standard to read widely, but now it’s actually a competitive advantage—because fewer people do it. Reading plays a crucial role in investing because investing is an intellectual capital business, and that capital is found in books. Reading also stimulates your imagination and visualization skills, which are essential when evaluating investments. You’ll find that great investors visualize ideas as they’re being pitched, mentally replaying scenarios based on their experience.”

A few more links I enjoyed: 

A Message From the Past (Thoughts on Nostalgia) – via Morgan Housel

• Key quote: “There’s a Russian saying about nostalgia: ‘The past is more unpredictable than the future.’ It’s so common for people’s memories about a time to become disconnected from how they actually felt at the time. I have a theory for why this happens: When studying history, you know how the story ends, which makes it impossible to imagine what people were thinking or feeling in the past.”

A Primer on AI Data Centers – via Eric Flaningam 

• Key quote: “‍We’re currently in the midst of one of the largest computing infrastructure buildouts in history. 100+ years ago, we saw a similar buildout of the electric grid (which ironically is a bottleneck for today’s buildout). Throughout the birth of the electric grid, we saw the scaling of power plants (building power plants as large as possible to capture performance improvements), ‘Astronomical’ CapEx investments, and the plummeting cost of electricity.”
   

Field Report: 5 Takeaways from We, Robot – via Dan Crowley, CFA

• Key quote: “Most investors had an immediate, gut reaction to last week’s Tesla’s Robotaxi event, and I understand why. I was there—it was a spectacle… My takeaway: seeing Optimus up close was not just impressive, it was transformative. It felt natural, even intuitive, to be around these humanoid robots, and it became clear to me that we are no longer talking about some distant, sci-fi dream. I believe the foundation for massive demand is being laid, and while it will take time, the end destination seems inevitable.”

Hallelujah: Leonard Cohen’s Blessings in Disguise – via Frederik Gieschen

• Key quote: “Leonard Cohen didn’t record his first album until he was thirty-three. It was 1967 and by the standards of the hippie era (“Don’t trust anyone over 30.”), he was late to the game. “A thirty-two-year-old poet? Are you crazy?” one record label executive said when Cohen was signed. I just finished the Cohen biography I’m Your Man and a heartwarming documentary about the origins of Hallelujah, his best-known song (famously covered by Jeff Buckley and many others). I was struck by a particular aspect of Cohen’s story: his resilience.”

Test Your Network – via Tom Morgan

• Key quote: “The quality of your network is defined by size and time. Dunbar’s Number is the robustly-proven finding that the optimal human group size is somewhere around 150 people, but the typical network is far from evenly-distributed. Perhaps less well-known is that Dunbar believed your network scaled from an intimate circle of 5, followed by successive layers in rough multiples of three: 15 (good friends), 50 (friends), 150 (meaningful contacts), 500 (acquaintances) and 1,500 (people you can recognize). Recent research confirms that this relationship has held surprisingly constant, even now many of our friendships have been digitized.”

From the archives:

Joel Greenblatt: Investing Made Simple – via The Knowledge Project (2021)

• Key quote: “There are a lot of smart people out there, a lot smarter than me. But if you look at things from 40,000 feet or a different angle—that’s where I have tended to have my most success. I just realized ‘Yes, everyone is looking at it this way, but I think that’s not the right way to look at it.’ When you recognize that you have this other way to look, and that makes total sense to you and all the pieces fit when you look at it that way, I think those are the great opportunities.”