Chris Dixon

Quotes are word for word from the source.

• Prudence before funding

  “When you do planning, research, experimenting etc. without having raised money, investors think you are prudent”

  Our noteThe perception of a founder's research phase before they take outside capital.

• Building strong ties

  “The relationships start off weak - a retweet, @ reply, or blog comment - but often strengthen through further discussions and eventually become new friendships and business relationships.”

  Our noteDixon explains how social media interactions evolve into meaningful professional and personal connections.

• Due diligence on investors

  “the most important question to ask before taking seed money is: How many companies that the sponsor passed on went on to raise money from other sources?”

  Our noteDixon advises founders on how to evaluate seed programs run by large venture firms.

• Logic of bundling

  “But this reasoning misses the economic logic behind bundling: under assumptions that apply to most information-based businesses, bundling benefits buyers and sellers.”

  Our noteDixon explains why bundling is not just a relic of physical distribution but an economic strategy.

• Preference variance

  “The benefits of bundled pricing are proportionate the buyers' variance of preferences for the goods.”

  Our noteDixon explains that bundling works best when customers value different items in the bundle differently.

• Smartphone adoption growth

  “By 2020, 80% of adults on earth will have a smartphone: And each of those phones is equivalent to what we used to call a supercomputer”

  Our noteChris was discussing the massive scale and power of the upcoming smartphone revolution.

• Direct monetization economics

  “The economics of low take rates plus enthusiastic fandom does wonders. On Substack, 1,000 newsletter subscribers paying $10/month nets over $100K/year to the writer.”

  Our noteDixon explains how low platform fees and direct fan support significantly increase creator income.

• Evolution of mobile apps

  “It seems natural that the first wave of mobile apps would be about improving core smartphone apps (e.g. photo apps) or porting apps from other devices (e.g. games).”

  Our noteHe explains why early mobile apps focused on digital-only features.

• SEO virtuous cycle

  “This led to a virtuous cycle where SEO drew more users, leading to more contributors and more inbound links, leading to more SEO, and so on.”

  Our noteDixon explains how early web giants like Yelp and Wikipedia used SEO to scale their growth.

• Code as trust

  “A user or developer can trust that a piece of code running on a blockchain computer will continue to behave as designed”

  Our noteHe describes the technical guarantees that blockchain provides to developers compared to corporate platforms.

• Growing the pie

  “Instead of fighting over pieces of a shrinking pie , try to grow the pie by getting more people to read and write books.”

  Our noteHe suggests that industries should encourage user creativity rather than stifling it with litigation.

• Evaluating strategic position

  “When evaluating an internet company's strategic position (the defensibility of its profit moat ), you need to consider: 1) how the company generates revenue and profits, 2) the loop in its entirety”

  Our noteDixon outlines the two key factors for assessing a company's competitive advantage in the digital economy.

• Native tablet productivity

  “If the historical pattern repeats, productivity apps that are "native" to the tablet will be invented.”

  Our noteHe predicts that new user interfaces always lead to new classes of software.

• Ad revenue and intent

  “The lesson is that the RPMs* of online ads are directly proportional to the degree** to which the user has purchasing intent”

  Our noteDixon explains why certain search terms generate more money than others.

• Macro trend prediction

  “Anyone who claims to know what will happen over the next 3 years at the macro level is blowing hot air. That's why smart investors continue investing at a regular pace through ups and downs.”

  Our noteDixon explains why predicting the macro economy is impossible and how smart investors behave.

• Direct founder outreach

  “Most journalists, when talking candidly, will tell you they'd vastly prefer getting an email from the founder of a startup than a PR firm.”

  Our noteDixon explains why founders should handle their own press relations instead of hiring PR firms early on.

• Limitations of algorithms

  “Algorithms that deal with large data sets tend to be accurate at best 80%-90% of the time (an old "joke" about machine learning is that it's really good at partially solving any problem ).”

  Our noteDixon explains the inherent inaccuracy of machine learning models when dealing with large datasets.

• Past vs Future Returns

  “But it's a mistake to assume that - because VC brands and institutional knowledge persist - past returns will predict future returns.”

  Our noteDixon explains why relying on old track records in venture capital is a flawed strategy.

• Partners Drive Returns

  “VC returns are driven by partners, not firms. Studies have shown this, as will a quick perusal of the big exits at prominent VC firms.”

  Our noteHe argues that individual talent matters more than the firm's brand name.

• Isolation for creativity

  “The presence of others can only inhibit [the creative] process, since creation is embarrassing.”

  Our noteExplaining why the early stages of ideation should happen in private.

• Entrepreneurial activity shift

  “In the transition from installation to deployment, the bulk of the entrepreneurial activity moves "up the stack".”

  Our noteDiscussing how opportunities move from infrastructure to applications over time.

• Equity dilution risks

  “I've seen many cases where large investors used financial engineering to artificially reduce the value of smaller investors' equity.”

  Our noteChris discusses how large investors can manipulate deal terms to disadvantage smaller shareholders.

• Integrated vs Non-integrated

  “The non-integrated approach lowers costs, but adds friction between components that compromises performance.”

  Our noteDixon explains the trade-offs between building hardware and software together versus separately.