Patrick McKenzie

Quotes are word for word from the source.

• Email spam tools

  “If you are comfortable administering your own email server (and already do), use SpamAssassin . If you are not, use Popfile .”

  Our notePatrick recommends specific tools for managing email spam based on technical proficiency.

• Fair pricing strategy

  “My guiding principle was to be mostly fair without sacrificing the convinience of round numbers”

  Our noteHe describes his method for setting prices in different international currencies.

• Absorbing customer costs

  “I'm pretty sure all of my international customers benefit in that I absorb their currency conversion costs through Paypal”

  Our notePatrick discusses the benefit of paying the conversion fees on behalf of his customers.

• Brand damage vs cost

  “The damage to the brand from having to put that sign up everywhere, on the other hand, is at literally many orders of magnitude above the individual store.”

  Our notePatrick discusses why canceling a promotion is more expensive than absorbing the cost of free drinks.

• Logistics over tactics

  “Amateurs talk strategy or tactics. Professionals talk logistics. Most misappropriation of payment credentials happens at an industrial scale.”

  Our noteHe emphasizes that large-scale operations depend on supply chains rather than simple cleverness.

• Security theater

  “The vast majority of clerks won't even check signatures these days, which people are sometimes annoyed by. They put on the back of the card, "Ask to see my ID." That has no legal effect.”

  Our noteDiscussing the practical irrelevance of manual signature verification in modern retail.

• Evil vs Competence

  “I broadly think people overpredict evil and underpredict competence. I thought I was sophisticated for believing this, and then got to my adult life and realized, "Oh, wait, evil actually exists.”

  Our noteDiscussing why fraud detection rates are lower than expected in traditional markets.

• Skill Venn diagrams

  “Clearly, the successful engineers in the future will be playing a Venn diagram game where they do one hard thing that is engineering and one hard thing that is speaking a foreign language.”

  Our noteHis early career strategy for staying competitive in the tech industry.

• Reasons versus outcomes

  “I often mention this to people as an example of, you can have great reasons for doing something and have that utterly not matter.”

  Our noteReflecting on how a flawed premise led to a life-changing move to Japan.

• Compounding effects of writing

  “The compounding effects of writing more are responsible for both a lot of the good stuff that has happened to me and a lot of the good stuff that I've been able to accomplish in the world.”

  Our notePatrick discusses how his early writing habit in Japan led to his later career success.

• Risk management solutions

  “If you care profoundly about credit risk, say the word and you will be sold a solution for it! This will cost money and has tradeoffs”

  Our noteExplaining that eliminating banking risk is a product that can be purchased for a price.

• Building in public

  “I'm decided on developing this semi-publicly - I'll be publishing the market, the spec, the thinking behind it, pretty much everything but the source code.”

  Our notePatrick explains his plan to share the development process of his new project openly.

• Definition of leverage

  “Leverage is the ratio of your liabilities to your equity. Simple division. Fourth grade math.”

  Our notePatrick explains the basic mathematical definition of financial leverage using a balance sheet.

• Risk transfer mechanics

  “The risk of the stock decline has, effectively, been transferred from the customer to the broker.”

  Our notePatrick discusses what happens when a customer's leveraged position loses more value than their equity.

• Financing as sales tool

  “the sales process would strongly prefer the purchase be financeable, because that will sell more windows than a counterfactual world where windows were only available for cash.”

  Our noteDiscussing how offering credit increases the total addressable market for expensive home goods.

• Budgeting for experts

  “I am a fairly competent HTML programmer and was going to bang out my web site by myself (contrary to my own advice below, which was hire an expert: I just don't have it in my shoestring budget).”

  Our notePatrick discusses the trade-off between hiring experts and doing it yourself when on a tight budget.

• Unexpected first sale

  “That was quite unexpected (I had almost turned off my ads for the weekend on the assumption they would not lead to money).”

  Our notePatrick reflects on his surprise at getting a sale during the weekend when he almost stopped ads.

• Regional economic disparity

  “Tokyo, for its perspective, views the regions with the noblesse oblige that you would expect a cosmopolitan center of culture and learning to have with respect to their benighted country bumpkin cousins.”

  Our noteDescribing the cultural and economic tension between Tokyo and rural Japan.

• Web vs Desktop

  “If I were starting out today, I would, without a shadow of a doubt, write a web app instead of a desktop app”

  Our notePatrick reflects on his transition from building desktop software to web applications.

• Cost of failure

  “Yeah, I know, a heck of a lot cheaper than failing a test with a $80 admission fee and having to wait until next year to take it again.”

  Our notePatrick justifies the cost of a study tool by comparing it to the cost of failing.

• Prioritizing System Stability

  “I went back to Plan A: reverted to the cart which charges 1,499 customers a year correctly and causes 1 guy to wait a bit while I decide how to address this in a more long-term fashion”

  Our notePatrick decided to revert to a stable but slightly flawed system rather than keep a broken fix.

• Disaster recovery confidence

  “if you have a repeatable procedure for provisioning a production system, then when disaster strikes you will be able to confidently execute that procedure”

  Our noteThe benefit of having automated infrastructure scripts.

• The color of bits

  “One classic misunderstanding by engineers is that data can be compared reliably by computers. On the one hand, this is a foundation on which our civilization now rests. On the other hand, human society doesn't evaluate data - bits - like computers do.”

  Our notePatrick explains that data has context and history that computers cannot see.

• Key Advertising Metrics

  “There are only two numbers you care about: CR and CPA. Everything else is noise - potentially meaningful noise when you're optimizing your ad, but otherwise its just noise.”

  Our noteHe explains which metrics actually matter for a business owner's bottom line.

• International mindset alpha

  “This makes an international mindset a surprisingly durable source of alpha, even in professional fields, even ones which are intensely globalized.”

  Our notePatrick discusses how living between two cultures provides unique business insights.

• Define SEO Goals

  “Ideally speaking, well prior to launch you should figure out exactly what you hope to get for from SEO. "Rankings" is not an acceptable answer. Neither is "visitors".”

  Our notePatrick emphasizes that SEO must be tied to business outcomes like sales, not just vanity metrics.

• Scalability vs consulting

  “After you're capable of waving the magic wand and getting another one out the door, there's increasingly less and less impetus to go out and grab another client engagement.”

  Our notePatrick discusses how successful products can eventually replace the need for traditional consulting.

• Leveraging existing tools

  “I love it when other people do my work for me.”

  Our notePatrick was discussing using an existing Javascript library to solve a technical challenge for his widget.

• Trust as Currency

  “Trust is currency, because without trust I get no currency . The Paypal name means "Buy here and you're covered" to the astoundingly high seventy percent of my customers who have an account with them.”

  Our noteHe discusses how brand recognition in payment processing affects conversion rates.

• Niche positioning

  “So instead of being Generic Photo Organizer #1278, maybe you could be World's Best Photo Organizer For Wedding Photographers.”

  Our noteHe suggests a specific way to differentiate a product in a crowded market.