In 2022, I helped Vivek Mashrani with his book You Can Compound — originally self-published, it became a national bestseller in India, and was then re-published by Penguin — and I realised that the book publishing industry is ripe for disruption.

The sheer inefficiency in the process — long turnaround times, debates over inelegant designs, timeline negotiations — combined with the fact that leading publishing houses pay authors only ~10% royalty, presented a screaming opportunity for someone to start an unconventional book publishing company.

My conversations with author Jimmy Soni, founder of OSV Jim O’Shaughnessy, designer of the eudaimonia machine David Dewane, and director of UChicago Press Garrett Kiely, each corroborated this intuition.

All of this crystallised what I think a great publishing house looks like:

1. Author-first, both economically (higher royalty %) and philosophically (focused on enabling authors to produce their best work). When all the insights in the book are the author’s, why should they get only 10% of the economic value? Robert Pirsig’s Zen and the Art of Motorcycle Maintenance was rejected by 121 publishers: the traditional system nearly killed one of the greatest books of the 20th century.

2. Has good taste, meaning it is selective and only publishes high-quality books. Now obviously these are subjective notions. But in practice this means that for a certain group of readers, the phenomenon of ‘I will read any book Sebastian Mallaby writes’ extends to ‘I will read any book Stripe Press produces’. As a reader, you trust the taste of not just a specific author, but the publishing company as a whole. The current paradigm of readers having ‘favourite authors’ transforms into readers having ‘favourite book publishers’.

3. Crafts an immersive reading experience. This could mean high-quality printing, aesthetic fonts and cover designs, and even digital companions to the physical book. For example, this version of the Bhagavad Gita has a speaker pen that orates verses while reading them. Hannu Rajaniemi speaks about neurofiction, stories that change depending on the reader. And Tyler Cowen has written this AI-native book about the marginal revolution in economics.

I’m thrilled to see many smart people catching onto this opportunity. In this article, I highlight some of the new-age, unconventional publishers that I’m most excited about. These companies range from well-established with dozens of books published to newly-started with a couple of books announced, but each represents a distinct bet on what publishing can become.

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Stripe Press

Perhaps one of the first to catch onto this opportunity (?), Stripe Press has helped popularise books like Where Is My Flying Car? and The Art of Doing Science and Engineering, and bring to life books like The Scaling Era by Dwarkesh Patel. Their books also have really cool ‘living covers’ online.

Having said that, I’m not exactly a fan of the Stripe Press version of Poor Charlie’s Almanack — I prefer the blue-cover version for its numerous aesthetically-pleasing illustrations, which make a world of a difference to the reading experience.

Quanta Books

As a math and physics buff, I love reading Quanta Magazine, and it’s so exciting to see their upcoming books The Proof in the Code (about the math proof verification software Lean), Six Math Essentials (written by the legendary mathematician Terence Tao), and Everything is Fields (a book about quantum field theory from one of its most passionate communicators, David Tong).

I imagine I will read every book that Quanta Books produces…

Infinite Books

Founded by Jim O’Shaughnessy and headed by Jimmy Soni, one of my favourite authors. I loved his books A Mind At Play (biography of Claude Shannon) and The Founders (founding story of PayPal). An author who has gone through the traditional publishing process can bring deep nuance and insight into a publishing company, and Infinite Books is poised to benefit from his wisdom.

Their model treats the physical book as the anchor of a broader experience — their first book Two Thoughts came with an audiobook accessible only to buyers of the physical copy, an early example of what I think will become a growing trend towards digital companions for physical books. The book also came with a bunch of cool stickers!

Arena Books

From the creators of Arena Magazine. They have a coffee table book called Silicon coming out in May that I pre-ordered as soon as I heard about it. It’s “an art book and anthology” about the semiconductor revolution and looks stunning! Talk about good taste: this book has “a special foil stamped cover, a genuine thread binding, and 384 pages of European archival paper”, hundreds of full-page photographs, and essays by such insightful people as Dylan Patel.

Challenges

The biggest challenge I see for someone wanting to start a new-age publishing house is distribution. The existing publishers — HarperCollins, Random House etc. — are too embedded in conventional channels like bookstores.

I am yet to see a Stripe Press book at an airport bookstore. Publishing a book with Penguin almost guarantees a certain level of visibility, discovery and sales, and it is hard to see why any author would give that up voluntarily.

Online channels, particularly social media and online newsletters/podcasts, seem to be the most plausible solution to the distribution problem for these new-age publishing houses. Quanta and Arena each have magazines with thousands of readers they can cross-sell their books to (so does Stripe, with Works in Progress). Jim O’Shaughnessy, Jimmy Soni and Dylan O’Sullivan have strong personal brands and a substantial social media follower base to drive sales for Infinite Books. If done well, the distribution problem can be solved.

It is also an open question whether it is possible for the publishing company to be profitable while giving authors a larger chunk of the royalties. My understanding of the unit economics is that currently, a large chunk of a book’s retail price goes to Amazon or the bookstore as their profit margin. Sidestepping this by constructing an alternative distribution pipeline can enable the publisher to provide a greater share of author royalties.

The other possible route is that a high-quality, devoted reader base — attracted by being tasteful — means you have pricing power. Arena’s Silicon book is priced at $99, for example.

The upshot of taking on these challenges is that we can break the shackles of the conventional publishing industry and create deeply meaningful, well-crafted books that are works of art. We can create the next generation of GEBs, Power Brokers, and Poor Charlie’s Almanacks that continue to inspire curious minds. Seeing this wave of new-age publishing companies makes me feel like a kid in a candy store — it’s an exciting time to be a bookworm!

Feedback and reading recommendations are invited at malhar.manek@gmail.com

Unless you have been living under a rock, you have probably heard of the PayPal Mafia. Early PayPal employees went on to start, lead, or invest in, Facebook, SpaceX, Tesla, YouTube, LinkedIn, Palantir, Uber, Lyft, Stripe, OpenAI, Airbnb, Sequoia Capital, Founders Fund, Neuralink, Yammer, Yelp, Quora, Reddit, Tumblr, Pinterest, Evernote, and Khosla Ventures.

In other words, PayPal Mafia = Bell Labs of the business world.

Interestingly, the only mention of the connection between Cryptonomicon and the PayPal Mafia I could find was the one sentence in Zero To One -

I don’t know of a single interview where any of the Mafia members mention the book (if you do, please email me!) So when I started reading it, I felt a dopamine surge like the one you get when you find a hidden intellectual treasure trove that the internet hasn’t discovered yet.

After pounding through the ~900 pages of intellectual fiction that is Cryptonomicon, from cryptography to information theory to business strategy and beyond, the things I’ve learnt are remarkable — by far the most insights I’ve gleaned from a fiction book. So here’s an essay about my top learnings, connecting the dots with the PayPal Mafia.

I think the first page of Cryptonomicon gives a great overview of what the book is about -

“There is a remarkably close parallel between the problems of the physicist and those of the cryptographer. The system on which a message is enciphered corresponds to the laws of the universe, the intercepted messages to the evidence available, the keys for a day or a message to important constants which have to be determined. The correspondence is very close, but the subject matter of cryptography is very easily dealt with by discrete machinery, physics not so easily.” —Alan Turing

This morning [Imelda Marcos] offered the latest in a series of explanations of the billions of dollars that she and her husband, who died in 1989, are believed to have stolen during his presidency. “It so coincided that Marcos had money,” she said. “After the Bretton Woods agreement he started buying gold from Fort Knox. Three thousand tons, then 4,000 tons. I have documents for these; 7,000 tons. Marcos was so smart. He had it all. It’s funny; America didn’t understand him.”

—The New York Times, Monday, 4 March, 1996

Let’s dive in!

Making License Plates

Cryptonomicon has 3 interweaved plot lines. One is about World War II military; another is about cryptography; and the third is about a startup. The startup, called Epiphyte Corporation, is run by Avi and Randy — an excerpt about this below, followed by some dot-connecting!

“Pinoy-grams?”

“Here’s how it works. You are an Overseas Contract Worker [in the Philippines]. Before you leave home for Saudi or Singapore or Seattle or wherever, you buy or rent a little gizmo from us. It’s about the size of a paperback book and encases a thimble-sized video camera, a tiny screen, and a lot of memory chips. The components come from all over the place — they are shipped to the free port at Subic and assembled in a Nipponese plant there. So they cost next to nothing. Anyway, you take this gizmo overseas with you. Whenever you feel like communicating with the folks at home, you turn it on, aim the camera at yourself and record a little video greeting card. It all goes onto the memory chips. It’s highly compressed. Then you plug the gizmo into a phone line and let it work its magic.”

“What’s the magic? It sends the video down the phone line?”

“Right.”

“Haven’t people being messing around with video phones for a long time?”

“The difference here is our software. We don’t try to send the video in real time — that’s too expensive. We store the data at central servers, then take advantage of lulls, when traffic is low through the undersea cables, and shoot the data down those cables when time can be had cheap. Eventually the data winds up at Epiphyte’s facility in Intramuros. From there we can use wireless technology to send the data to 24 Jam stores all over Metro Manila. The store just needs a little pie-plate dish on the roof, and a decoder and a regular VCR down behind the counter. The Pinoy-gram is recorded on a regular videotape. Then, when Mom comes in to buy eggs or Dad comes in to buy cigarettes, the storekeeper says, ‘Hey, you got a Pinoy-gram today,’ and hands them the videotape. They can take it home and get the latest news from their child overseas. When they’re done, they bring the videotape back to 24 Jam for reuse.”

…

“So, let me guess,” she says, “you are the guy doing the software.”

“Yeah,” he admits, a little defensive, “but the software is the only interesting part of this whole project. All the rest is making license plates.”

That wakes her up a little. “Making license plates?”

“It’s an expression that my business partner and I use,” Randy says. “With any job, there’s some creative work that needs to be done — new technology to be developed or whatever. Everything else — ninety-nine percent of it — is making deals, raising capital, going to meetings, marketing and sales. We call that stuff making license plates.”

She nods, looking out the window. Randy is on the verge of telling her that Pinoy-grams are nothing more than a way to create cash flow, so that they can move on to part two of the business plan. He is sure that this would elevate his stature beyond that of dull software boy. But Amy puffs sharply across the top of her coffee, like blowing out a candle, and says, “Okay. Thanks…”

Now, compare this to the memo Elon Musk wrote on August 2, 2006, titled “The Secret Tesla Motors Master Plan (just between you and me)”.

As you know, the initial product of Tesla Motors is a high performance electric sports car called the Tesla Roadster. However, some readers may not be aware of the fact that our long term plan is to build a wide range of models, including affordably priced family cars. This is because the overarching purpose of Tesla Motors (and the reason I am funding the company) is to help expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy, which I believe to be the primary, but not exclusive, sustainable solution.

Critical to making that happen is an electric car without compromises, which is why the Tesla Roadster is designed to beat a gasoline sports car like a Porsche or Ferrari in a head to head showdown. Then, over and above that fact, it has twice the energy efficiency of a Prius. Even so, some may question whether this actually does any good for the world. Are we really in need of another high performance sports car? Will it actually make a difference to global carbon emissions?

Well, the answers are no and not much. However, that misses the point, unless you understand the secret master plan alluded to above. Almost any new technology initially has high unit cost before it can be optimized and this is no less true for electric cars. The strategy of Tesla is to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model.

Without giving away too much, I can say that the second model will be a sporty four door family car at roughly half the $89k price point of the Tesla Roadster and the third model will be even more affordable. In keeping with a fast growing technology company, all free cash flow is plowed back into R&D to drive down the costs and bring the follow on products to market as fast as possible. When someone buys the Tesla Roadster sports car, they are actually helping pay for development of the low cost family car.

The way I think of this is, you start with a broad worldview and mission for what you want to accomplish (e.g., making humanity a space-faring civilisation), and then construct a business model around that vision. Who would’ve thought space exploration could be a business? Yet, SpaceX did it.

Start with a mission —> turn it into a business model to generate cash flows —> use the cash flows to expand in the direction of your larger mission —> repeat forever.

Here’s what writes about how Astro Mechanica is applying this idea.

When you want to fly somewhere – a little hop from SF to LA or a globe-spanning trip from New York to Tokyo – you book it directly with Astro Mechanica. You get there three times faster on planes designed and built by Astro Mechanica, powered by Astro Mechanica engines.

That’s the big goal, the one that changes the world by shrinking it.

But building planes that will fly passengers is a very expensive endeavor, thanks in part to the years and many test flights it takes to get a plane flight certified. A new Gulfstream might take 3 years and $5-7 billion dollars to get to the point at which it can start carrying passengers.

So you can’t start there. It would require so much venture capital that the founder wouldn’t end up owning anything at the end, even assuming he’s able to raise all the money. Plus, you’d want to run tests on something that you don’t mind blowing up.

So: to build the airline of the 21st Century, begin by launching rockets. Duh.

Space launch is the Roadster in Astro’s Tesla strategy: start at the highest end of the market and move cheaper and more mass market over time. From space launch to private planes (Model S), from private planes to commercial airliners (Model 3), building the airplane gigafactory along the way, until it’s churning out planes of all sizes cheaply and reliably.

And the below excerpt from Cryptonomicon reminded me of SpaceX’s reusable rockets.

If it will take ten years to make the machine with available technology, and only five years to make it with a new technology, and it will only take two years to invent the new technology, then you can do it in seven years by inventing the new technology first!

Philosophical Ways of Looking At Things

In the chapter titled Cycles, mathematicians Lawrence Waterhouse and Alan Turing are discussing an analogy between Turing’s bicycle and the German Enigma machine.

Waterhouse is thinking about cycles within cycles. He’s already made up his mind that human society is one of these cycles-within-cycles things* and now he’s trying to figure out whether it is like Turing’s bicycle (works fine for a while, then suddenly the chain falls off, hence the occasional world war) or like an Enigma machine (grinds away incomprehensibly for a long time, then suddenly the wheels line up like a slot machine and everything is made plain in some sort of global epiphany or, if you prefer, apocalypse) or just like a rotary airplane engine (runs and runs and runs; nothing special happens; it just makes a lot of noise).

*He has no hard data to back this up; it just seems like a cool idea.

Compare this to Peter Thiel’s standard question about college.

Is college a consumption good, like a four-year party? Is it an investment in the future? Is it an insurance policy? Or is it a tournament like the exclusive Studio 54 nightclub?

Contrarian Truths

To the savvy reader, Cryptonomicon is chockablock full of Thiel-esque contrarian truths and secrets. A couple excerpts below.

Dr. G. E. B. Kivistik had a few things to say about the Information Superhighway. He was a fiftyish Yale professor who had just flown in from someplace that had sounded really cool and impressive when he had gone out of his way to mention it several times. His name was Finnish, but he was British as only a non-British Anglophile could be. Ostensibly he was here to attend War as Text. Really he was there to recruit Charlene…

Another example, this time in the context of WW II cryptography, and its information theoretic implications.

“If what you are saying is true,” Lawrence says, “the jig must be up already. Rudy [the German cryptographer] must have figured out that we’ve broken their codes.”

“An informal system has been in place, which might be thought of as a precursor to Detachment 2701, or 2702 or whatever we are calling it,” Alan says. “When we want to sink a convoy, we send out an observation plane first. It is ostensibly an observation plane. Of course, to observe is not its real duty — we already know exactly where the convoy is. Its real duty is to be observed — that is, to fly close enough to the convoy that it will be noticed by the lookouts on the ships. The ships will then send out a radio message to the effect that they have been sighted by an Allied observation plane. Then, when we come round and sink them, the Germans will not find it suspicious — at least, not quite so monstrously suspicious that we knew exactly where to go. (emphasis added)

And one more.

The United States Military (Waterhouse has decided) is first and foremost an unfathomable network of typists and file clerks, secondarily a stupendous mechanism for moving stuff from one part of the world to another, and last and least a fighting organization.

Digital Currency

Gold-backed, cryptographically-enabled digital currency is perhaps the crux of the book. The parallels to Confinity — Peter Thiel and Max Levchin’s company that merged with X.com to become PayPal — are compelling.

Excerpt from the book -

“Doug. You can do this,” Randy says. “You get the gold. You put it on a boat. My friends here can explain the rest.” Randy fits the laptop’s plastic case back together and begins maneuvering the little screws back into their recesses.

Cantrell says, “You bring the boat here.”

Tom continues, “To that beach, right down the hill. I’ll be waiting for you with the Humvee.”

“And you and Tom can drive it downtown and deposit that bullion in the vaults of the Central Bank of Kinakuta.” Cantrell concludes.

Someone has finally said something that actually knocked Doug Shaftoe off balance. “And get what in return?” he asks suspiciously.

“Electronic cash from the Crypt. Anonymous. Untraceable. And untaxable.”

Compare this to what Jimmy Soni writes in The Founders, a book about the PayPal founding story -

In February 1999, Levchin attended the International Financial Cryptography Association conference. Hosted in Anguilla, a sliver of a Caribbean island, the annual gathering drew the leading players in academic cryptography and digital currencies. (To this day, Thiel, who attended the 2000 conference, harbors a theory that Satoshi Nakamoto—the mysterious founder of the cryptocurrency Bitcoin—was among the attendees.)

When Confinity had originally launched, it flirted with starting a universal digital currency free from government shackles.

In its original pitch documents, Confinity cast Mobile Wallet as a means of liberating the masses from currency-manipulating governments and reserve banks … Even the team’s casual internal parlance—“The World Domination Index,” for example, or the “New World Currency”—spoke to the aim of making PayPal a border-busting universal payments system.

X.com, too, had world conquest baked into its early DNA. One day, Musk hoped X.com would serve as the “global center for all money” and store the world’s dollars, deutschmarks (soon to be euros), and yen in one place. To Musk, this trajectory wasn’t revolutionary—it was obvious. Musk thought about currencies “from an information theory standpoint,” a reference to the field founded by Dr. Claude Shannon in 1948. “Money is an information system,” he explained. “Most people think money has power in and of itself. But actually, it’s really just an information system, so that we don’t have to engage in barter and that we can time-shift value in the form of loans and equity and stuff like that.”

Mathematical Skeleton

Two of my favourite excerpts from the book below.

The basic problem for Lawrence was that he was lazy. He had figured out that everything was much simpler if, like Superman with his X-ray vision, you just stared through the cosmetic distractions and saw the underlying mathematical skeleton. Once you found the math in a thing, you knew everything about it, and you could manipulate it to your heart's content with nothing more than a pencil and a napkin. He saw it in the curve of the silver bars on his glockenspiel, saw it in the catenary arch of a bridge and in the capacitor-studded drum of Atanasoff and Berry’s computing machine. Actually pounding on the glockenspiel, riveting the bridge together, or trying to figure out why the computing machine wasn't working were not as interesting to him.

As it happens, Alan has become fascinated by the incarnations of pure ideas in the physical world. The underlying math of the universe is like the light streaming in through the window. Alan is not satisfied with merely knowing that it streams in. He blows smoke into the air to make the light visible. He sits in meadows gazing at pine cones and flowers, tracing the mathematical patterns in their structure, and he dreams about electron winds blowing over the glowing filaments and screens of radio tubes, and, in their surges and eddies, capturing something of what is going on in his own brain. Turing is neither a mortal nor a god. He is Antaeus. That he bridges the mathematical and physical worlds is his strength and his weakness.

Investor Meetings

I found it fascinating how Avi prepares for an investor meeting.

Of the half-dozen important people in the room, three are middle-aged Filipino men. One of these is a high-ranking official in the PTA. The second is the president of an upstart telecommunications company called FiliTel, which is trying to compete against the traditional monopoly. The third is the vice president of a company called 24 Jam that runs about half of the convenience stores in the Philippines, as well as quite a few in Malaysia. Randy has trouble telling these men apart, but by watching them converse with Avi, and by using inductive logic, he is soon able to match business card with face.

The other three are easy: two Americans and one Nipponese, and one of the Americans is a woman … Her card identifies her as Mary Ann Carson, and claims that she is a V.P. with AVCLA, Asia Venture Capital Los Angeles, which Randy knows dimly as a Los Angeles-based firm that invests in Rapidly Developing Asian Economies. The American man … represents the Subic Bay Free Port. The Nipponese man is the executive vice president of a subsidiary of a ridiculously colossal consumer-electronics company.

Avi wastes little time in starting the videotape, which at the moment represents about seventy-five percent of Epiphyte Corp.’s assets. Avi had it produced by a hot multimedia startup in San Francisco, and the contract to produce it accounted for one hundred percent of the startup’s revenue this year…

It starts with footage — pilfered from a forgotten made-for-TV movie — of a Spanish galleon making headway through heavy seas. Superimpose title: SOUTH CHINA SEA—A.D. 1699. The soundtrack has been beefed up and Dolbyized from its original monaural version. It is quite impressive. (“Half of the investors in AVCLA are into yachting,” Avi explained.)

Cut to a stone tower on the crown of a green tropical island, where a lookout is sighting the (digitally inserted) galleon on the horizon. The lookout cups his hands around his mouth and bellows, in Spanish, “It is the galleon! Light the signal fire!” (“The family of the guy who runs the PTA is really into local history,” Avi said, “they run the Museum of the Philippines.”)

Cut to a series of shots of Manila townsfolk rushing to the seawall to adore the signal fire, including an Augustinian monk who clasps his rosary-strewn hands and bursts into clerical Latin on the spot (“the family that runs FiliTel endowed a chapel at Manila Cathedral”) as well as a clean-cut family of Chinese merchants unloading bales of silk from a junk (“24 Jam, the convenience store chain, is run by Chinese mestizos”).

A voiceover begins, deep and authoritative, English with a Filipino accent (“The actor is the brother of the godfather of the grandson of the man who runs the PTA”). Subtitles appear on the bottom of the screen in Tagalog (“the PTA people have a heavy political commitment to the native language”).

It reminds me of this extract from Walter Isaacson’s biography of Elon Musk.

For their first meeting with potential investors, [Kimbal and Elon] had to take a bus Sand Hill Road because the car their dad had given them broke down. But after word spread about the company, the VCs were asking to come to them. They bought a big frame for a computer rack and put one of their small computers inside, so that visitors would think they had a giant server. They named it “The Machine That Goes Ping,” after a Monty Python sketch. “Every time investors would come in, we showed them the tower,” Kimbal says, “and we would laugh because it made them think we were doing hardcore stuff.”

Haiku

Cryptonomicon starts with a haiku: a three-line poem with 5 syllables in the first, 7 in the second, then 5 again in the third. So, in that spirit, here’s a haiku I made up, to wrap up this essay.

Feedback and reading recommendations are invited at malhar.manek@gmail.com

Since then, I’ve come to develop this model for differentiated insights:

Δ consumption of content might relate to reading obscure rather than mainstream books, or consuming academic papers/podcasts/articles that others aren’t.

Δ interpretation is evident in the thought experiment that if Warren Buffett and I both read the same annual report, the Oracle of Omaha will glean far more insights.

In the spirit of Δ interpretation, I am sharing my understandings and interpretations from reading Peter Thiel’s Zero To One and Nassim Nicholas Taleb’s The Black Swan. While reading these books and thinking through their ideas, I had a number of insights from connecting the dots that I will elaborate in this post.

Quine’s Infinity of Interpretations

As it turns out, The Black Swan itself touches on this idea — logician W. V. Quine suggested that for any given set of facts, there could be an infinity of possible interpretations by different thinkers (somewhat like quantum mechanics, where interpretations range from Copenhagen to many worlds).

The Black Swan then points out the paradox that Quine’s hypothesis can itself be interpreted in infinitely many ways: “Note here that someone splitting hairs could find a self-cancelling aspect to Quine’s own writing. I wonder how he expects us to understand this very point in a noninfinity of ways.”

When I read this, I thought back to my favourite book, Gödel, Escher, Bach, which has a chapter (number VI) entirely on such ideas, and which argues for the universality of at least some messages. The Black Swan seems to agree:

Consider that two people can hold incompatible beliefs based on the exact same data. Does this mean that there are possible families of explanations and that each of these can be equally perfect and sound? Certainly not. One may have a million ways to explain things, but the true explanation is unique, whether or not it is within our reach.*

Thus, going back to my pseudo-equation above, in a message that has a single objective meaning, Δ interpretation = 0, hence Δ insights = 0. This may be a possible solution to the paradox inherent in Quine’s statement.

*If you are intrigued by this notion of explanations, I would recommend reading The Beginning of Infinity by David Deutsch.

The Future is Δ

Reductionism is an approach that seeks to explain everything in terms of fundamental rather than higher-level emergent explanations.

For example, consider one particular copper atom at the tip of the nose of the statue of Sir Winston Churchill that stands in Parliament Square in London. Let me try to explain why that copper atom is there. It is because Churchill served as prime minister in the House of Commons nearby; and because his ideas and leadership contributed to the Allied victory in the Second World War; and because it is customary to honour such people by putting up statues of them; and because bronze, a traditional material for such statues, contains copper, and so on.

Thus we explain a low-level physical observation — the presence of a copper atom at a particular location — through extremely high-level theories about emergent phenomena such as ideas, leadership, war and tradition. There is no reason why there should exist, even in principle, any lower-level explanation of the presence of that copper atom than the one I have just given.

Presumably a reductive ‘theory of everything’ would in principle make a low-level prediction of the probability that such a statue will exist, given the condition of (say) the solar system at some earlier date. It would also in principle describe how the statue probably got there.

But such descriptions and predictions (wildly infeasible, of course) would explain nothing. They would merely describe the trajectory that each copper atom followed from the copper mine, through the smelter and the sculptor’s studio, and so on. They could also state how those trajectories were influenced by forces exerted by surrounding atoms, such as those comprising the miners’ and sculptor’s bodies, and so predict the existence and shape of the statue.

In fact such a prediction would have to refer to atoms all over the planet, engaged in the complex motion we call the Second World War, among other things. But even if you had the superhuman capacity to follow such lengthy predictions of the copper atom’s being there, you would still not be able to say, ‘Ah yes, now I understand why it is there.’

— David Deutsch, in The Fabric of Reality

Likewise, a reductionist view of the future suggests that it is merely the set of temporal coordinates that have not yet occured. However, a more deep and interesting explanation is that the future is a time different from the present.

The future is interesting not because it hasn’t happened yet, but because it will be different from the present.

The Contrarian Question

Peter Thiel poses his famous contrarian question: What important truth do very few people agree with you on?

Good answers to the contrarian question are as close as we can come to looking into the future. (More on this soon.)

The Axes of Progress

There are two axes along which progress occurs: vertical (0 to 1) and horizontal (1 to n). These axes are orthogonal — i.e., perpendicular — which means that no component of one lies along the other (their dot product is zero). Simply put, vertical and horizontal progress are independent; “what got you here won’t get you there.”

This paradigm comes up in various domains:

• Economics, where developing economies (0 to 1) often adopt protectionism, which is disdained by developed economies (1 to n) who ‘kick away the ladder’ and prescribe one-size-fits-all policies. [I recommend reading Joe Studwell’s excellent book How Asia Works if you are interested in this.]

• Performance psychology, where deliberate practice is required to attain hard new skills (0 to 1), while a flow state is experienced when repeating what one is already proficient at (1 to n). [Cal Newport’s wonderful podcast with Andrew Huberman has a debate on deliberate practice v/s flow — my understanding is they correspond to 0 to 1 and 1 to n respectively, and are therefore orthogonal.]

• Those managing large family offices, endowments or pension funds are often incentivised to preserve capital (1 to n), as opposed to, say, an individual angel investor, who seeks to grow it at a rapid rate (0 to 1).

Terminal Value

When Peter Thiel ran some projections in 2001, he realised that 75% of PayPal’s value would come from cash flows generated after 2011, i.e., terminal value.

Similarly, when Elon Musk says that he expects Optimus to drive the majority of Tesla’s long term value, it is terminal value to which he is referring.

Terminal value is driven by growth and durability — the compounding formula is driven by rate of return (growth) and longevity of time period (durability).

While most analysts focus on short-term growth, the more important question to ask is, ‘will this firm be around 10 years from now?’ The best answers to this question arise not by crunching numbers on a spreadsheet but through an understanding of intangibles — especially enduring intangibles like people and culture. [One of the best ways to appreciate this point is to read The Founders by Jimmy Soni, a book about PayPal’s founding story — or my interview with the author and my post about scenius that touches on PayPal’s hiring methods, among other things.]

Proving Popperian Falsification

Karl Popper is often credited with the idea of falsification, namely that a hypothesis can never be confirmed but only ever disconfirmed. No number of spottings of white swans is sufficient to confirm the statement ‘all swans are white’, but a single sighting of a non-white swan is sufficient to disconfirm (falsify) it.

I had come this idea across a number of times, most notably in David Deutsch’s The Beginning of Infinity and in George Soros’ writings. While the idea of falsification is intuitively obvious, The Black Swan helped me gain deeper insights into a proof of the idea, which I detail here.

First, consider that the statement ‘all swans are white’ is logically equivalent to its contrapositive statement ‘all non-white objects are non-swans’ — which in turn can be rephrased as ‘the set of all non-white objects does not contain swans’.

For intuition, one can think of the contrapositive as a mathematical inequality: when both sides are multiplied by a negative number or when the reciprocal of both sides is taken (the or here is exclusive), the inequality sign is flipped. For instance, 5 > 3, but 1/5 < 1/3.

Hence, if it is true that the spotting of a white swan constitutes evidence for the validity of ‘all swans are white’, then it is also true that the spotting of a non-white non-swan (say, a red car) constitutes evidence for the validity of ‘all swans are white’. The latter is clearly erroneous, hence the Popperian idea of falsification is proven via reductio ad absurdum — QED.

Note how the above reasoning has not confirmed falsification itself, but disconfirmed its opposite — a proof by contradiction. Even falsification itself cannot be confirmed — this is akin to how a fallibilist must question fallibilism itself, or how a skeptical empiricist must doubt skeptical empiricism itself.

I would rather have questions that can’t be answered than answers that can’t be questioned.

— Richard Feynman

Kolmogorov Complexity

Suppose I send you a message of information value, say, one million bits, and you wish you further transmit this message to person X. If the characters in the message are perfectly random (such that the message makes no sense to a human), your transmitted message must also necessarily contain one million bits.

However, suppose now that the message I send you — again with a million bits — has the phrase ‘Black Swans are asymmetric’ typed out 50 times. In this case, your message to person X could simply type the phrase once and include a rule for repeating it 50 times. Hence, the message you transmit to person X contains much fewer than a million bits.

This phenomenon is termed Kolmogorov complexity, after Andrey Kolmogorov. The insights here are plentiful.

First, notice how Kolmogorov complexity is intensely dynamic, which means that an arbitrarily long, convoluted message (say, 200 pages long) that is seemingly random (high complexity) can, with the addition of a single suitable sentence, make complete sense.

This extra phrase may be, for example, a key to decrypt the message, or context that helps make sense of it. In such a case, complexity plummets instantly — and, somewhat counterintuitively, even though the extra sentence adds information (bits), it reduces the Kolmogorov complexity of the message as a whole.

This first point is similar to the idea of data compression.

Imagine six animated people having dinner around a table; they are deeply engrossed in a common discussion about, say, a person not there. During one moment of this discourse about Mr. X, I look across the table at my wife and wink. After dinner, you come up to me and say, “Nicholas, I saw you wink at Elaine. What did you tell her?”

I explain to you that we had dinner with Mr. X two nights before, at which time he explained that, contrary to __ he was in fact __, even though people thought __, but what he really decided was __ etc. Namely, 100,000 bits (or so) later, I am able to tell you what I communicated to my wife with 1 bit (I ask your forbearance with my assumption that a wink is 1 bit through the ether).

What is happening in this example is that the transmitter (me) and the receiver (Elaine) hold a common body of knowledge, and thus communication between us can be in shorthand. In this example, I fire a certain bit through the ether and it expands in her head, triggering much more information. When you ask me what I said, I am forced to deliver to you all 100,000 bits. I lose the 100,000-to-l data compression.

— Nicholas Negroponte, in Being Digital

Second, the parallels to computer code are plentiful. Consider how, in the case of the second message, a FOR loop can replace repeated PRINT functions, thus making the code succinct. In some sense, therefore, there exists a correspondence between Kolmogorov complexity and the maximal compactness of a computer program (an isomorphism, as GEB fans would call it).

Type I and II errors

“The power law means that differences between companies will dwarf the differences in roles inside companies.” Hence, participating in the ones that will create value is crucial. Put differently, when it comes to betting on outliers, mistakes of omission (type I) are much more expensive than mistakes of commission (type II).

The nature of the argument being made here is very similar to one that comes up often in math and physics:

• Mass of string << mass of weights in a pulley system

• Radius of earth >> height of a building

In such scenarios, the limiting case is often of great interest. The limit as x tends to infinity of (ln x / x) equals zero, for instance.

Connecting the dots, one can see that outlier bets premised on the power law distribution (0 to 1) are orthogonal to evolutionary biology (1 to n) — the former seeks to minimise Type II errors while the latter seeks to minimise Type I errors.

Natural selection among animals is incessant and merciless and has produced millions of species, all of whom adhere to this simple principle: Minimize the risk of committing type I errors to curtail the risk of injury or death, and learn to live with type II errors or foregone benefits.

— Pulak Prasad, in What I Learned About Investing from Darwin

Likewise for Black Swans — since they are so rare and impactful, Type I errors (omission) are costlier than Type II errors (commission).

Reverse Turkey

In some sense, connecting the dots with Zero To One, the reverse turkey idea is attempting an answer to the contrarian question, effectively saying: “Most people think Black Swan outliers can be safely ignored because they are not representative of the average, but the reality is that they drive the vast majority of outcomes in Extremistan.”

When betting that a Black Swan will occur, one is effectively being contrarian, risking a very-likely-but-small downside in pursuit of a highly-improbable-but-potentially-massive upside. Remember that a Black Swan is relative to expectations, so if a given event is to be a potential Black Swan, its complement (in set theory terms) must necessarily be “priced in” or “factored in”; hence, the non-occurence of the Black Swan does not create surprise, and therefore does not lead to a large downside. On the other hand, the occurence of the Black Swan does create surprise (by definition, since a Black Swan is relative to expectation), and hence promises a large upside if it materialises.

This framework supports Nero’s “bleed” strategy.

… Nero engaged in a strategy that he called “bleed.” You lose steadily, daily, for a long time, except when some event takes place for which you get paid disproportionately well. No single event can make you blow up, on the other hand—some changes in the world can produce extraordinarily large profits that pay back such bleed for years, sometimes decades, sometimes even centuries.

However, always betting that the Black Swan will occur effectively amounts to blind contrarianism — being contrarian just for the sake of opposing the crowds. Isn’t that simply a form of calibrated herd mentality (following the crowd but with a negative coefficient), as Patrick Collison suggests? This remains an open question for me, and thoughts would be very welcome.

One possible solution I can think of is that the Collison idea does not incorporate asymmetry of payoffs while the Taleb idea does.

However, there must be alignment between such a strategy and its practitioner.

…some business bets in which one wins big but infrequently, yet loses small but frequently, are worth making if others are suckers for them and if you have the personal and intellectual stamina. But you need such stamina. You also need to deal with people in your entourage heaping all manner of insult on you, much of it blatant.

People often accept that a financial strategy with a small chance of success is not necessarily a bad one as long as the success is large enough to justify it. For a spate of psychological reasons, however, people have difficulty carrying out such a strategy, simply because it requires a combination of belief, a capacity for delayed gratification, and the willingness to be spat upon by clients without blinking. And those who lose money for any reason start looking like guilty dogs, eliciting more scorn on the part of their entourage.

The nature of the referred-to stamina is itself interesting: “The main tragedy of the high impact-low probability event comes from the mismatch between the time taken to compensate someone and the time one needs to be comfortable that he is not making a bet against the rare event.”

Essentially, the contrarian view needs to be held for a long period of time, while the compensation — the “extraordinarily large profits that pay back such bleed for years, sometimes decades, sometimes even centuries” — is paid out in an extremely short period of time.

This connects back to the idea of minimising omission errors: since the compensation is paid out in an extremely short time period, it is of paramount importance that one participates during this time.

Ludic Fallacy

The ludic fallacy is when ideal, model games with odds that can be mathematically computed (e.g., blackjack) are used to learn about probabilities in the messy real world (e.g., financial markets).

…organized competitive fighting trains the athlete to focus on the game and, in order not to dissipate his concentration, to ignore the possibility of what is not specifically allowed by the rules, such as kicks to the groin, a surprise knife, et cetera. So those who win the gold medal might be precisely those who will be most vulnerable in real life.

Viewed from a different angle, then, the Black Swan idea is another solution to the contrarian question, effectively saying: “Most analysts focus on ideal, Platonic, precise-but-inaccurate probability calculations, but the reality is that while probabilities are hard to ascertain and susceptible to the ludic fallacy, payoffs can be estimated with a much lower error rate.”

Incremental Conditional Probabilities

For a normally distributed variable like expected lifespan, the older you grow, the lesser your incremental expected time to live. At birth, one might expect to live till the age of 80. At 80, one might expect to live another 5 years; at 85, another 2 years, and so on.

For a power-law distributed variable, on the other hand, the reverse is true. The better a startup is performing, the better it is expected to perform going forward. The more delayed a project already is, the longer it will take to complete going forward. This idea, which might be familiar as as the Lindy effect, supports the adage ‘average up your winners’.

Hofstadter’s Law: It always takes longer than you expect, even when you take into account Hofstadter’s Law.

— Douglas Hofstadter, in Gödel, Escher, Bach

Betting on Black Swans

Let me now present my understanding of the conditions under which it pays to bet on Black Swans (assuming the stamina condition is satisfied). Consider the concept of expected value: the probability multiplied by payoff, summed over all possible events.

I am skeptical about precise, numerical calculations of expected value — for instance, computing the expected value of a stock by estimating the probability-weighted bull, base, and bear scenarios — since these are susceptible to the ludic fallacy. Such an approach works when the odds are well-established and known, but that is hardly the case in many emergent domains.

Having said that, the non-numerical idea of expected value provides an interesting explanation for the payoffs of betting on Black Swans.

First, consider the trivial statement that as the extremity of an event increases, its probability decreases. However, the rate at which this occurs differs greatly depending on the nature of the distribution.

For a normally distributed variable (Gaussian/bell curve), the probability of extreme events declines at an exponentially increasing rate. The probability of a 4-sigma event is twice that of a 4.15-sigma event; the probability of a 20-sigma event is one trillion times that of a 21-sigma event!

On the other hand, a power law distribution is characterised by scale-invariance. In fact, the very name — ‘power’ in ‘power law’ — relates to the exponent in fractals, i.e., fractal dimensions (also called Hausdorff dimensions). Fractals are defined through recursion and scale-invariant structures. As a result, probabilities do not fall disproportionately for events with ever-increasing extremity.

In both cases, as extremity rises, probability falls (of course) — the difference is that this decrease in probability is disproportionate and exponential in a normal distribution but not in a power law distribution.

Thinking back to expected value,

• In a normal distribution, expected value falls as extremity of an event rises (since the decrease in probability offsets the increase in extreme payoffs)

• In a power law distribution, expected value rises as extremity of an event rises (since the increase in extreme payoffs offsets the decrease in probability)

This, then, is a slightly technical way of reasoning to illustrate the same idea: betting on outlier Black Swans is a favourable strategy in power law distributed systems, though not in normally distributed ones.

Worldviews

Optimism and pessimism are self-explanatory. A definite world is where one has firm convictions and systematic plans. An indefinite frame is one where no concrete measures are taken to transform the optimistic or pessimistic worldview into reality.

Since Black Swans are relative to expectation — what is a Black Swan for the hypothetical turkey is not a Black Swan for the butcher — definite optimists are well-prepared for outlier events, while indefinite optimists are exposed to negative Black Swans.

By the way, I hypothesise that these philosophical worldviews are linked to world orders (as described in Ray Dalio’s Principles For Dealing With The Changing World Order) — I hypothesise that definite optimism is linked to a favourable world order position (e.g., USA in the 1950s).

There are a whole host of ideas that I’ve skipped here for brevity’s sake: redundancy as a hedge against fragility, Popper’s fundamental unpredictability, barbell strategy, evidence of no disease ≠ no evidence of disease, the equivalence between predicting a random variable and guessing a nonrandom-but-unknown variable, and much more.

Feedback and reading recommendations are invited at malhar.manek@gmail.com

• Gödel, Escher, Bach by Douglas Hofstadter. My favourite book. Beyond brilliant. An extraordinarily profound, interdisciplinary book on consciousness/intelligence and how it arises from inanimate matter. Explores an enormous breadth and depth of ideas along the way: formal mathematical systems, music theory, self-referential paradoxes, DNA structures, chess engines, and recursion are just a few examples. I wish there were more books like this. 11/10.

• Zero To One by Peter Thiel. Most people think of this as a business book, but I think it is a deeply profound guide on building the future. I have written this essay about Peter Thiel and this essay about Zero To One and its connections to ideas from The Black Swan. 11/10.

  

• Totto-chan by Tetsuko Kuroyanagi. A childhood memoir of someone who attended a very unconventional school in Japan during WW II. The teaching philosophy of the school is truly profound and beautiful. Many thanks to Ashwin Kandoi for gifting me this book. 11/10.

• A Mind At Play by Jimmy Soni and Rob Goodman. A biography of my favourite thinker, Claude Shannon, who was the pioneer of information theory (among many other things). The book has remarkable insights into his breadth and depth of intellectual curiosity (he was a tremendously successful investor and even wrote an academic paper on the mathematics of juggling!) Reading this article by the authors convinced me to buy the book. Some of my notes from the book here. My interview with co-author Jimmy Soni here. 10/10.

• The Beginning of Infinity by David Deutsch. The author is one of the pioneers of quantum computing. The book is brilliant exposition on epistemology, physics, optimism and ‘good explanations’. Each page is filled with pure wisdom. For those in a hurry, my favourite chapter is #10, a profound dialogue on culture, mindsets and attitudes towards knowledge (easy to read too!) Also check out his work on Constructor Theory. 10/10.

  

• The Fabric of Reality by David Deutsch. Same author as The Beginning of Infinity, above. In this book, he makes the argument that the ‘fabric of reality’ is made of 4 strands: quantum mechanics, computer science, biological evolution, and epistemology. If nothing else, read chapter 2, which explains quantum physics from scratch, assuming no prior knowledge, and expounds the multiverse interpretation of quantum physics that Deutsch so heavily advocates. 10/10.

• Understanding Comics by Scott McCloud. Applies a scientific prism to comics, to illuminate fascinating perspectives on their effectiveness: distributions of various types of transitions between panels, for example. Written as a comic about comics, it is reminiscent of strange loops and is the perfect book to read after Gödel, Escher, Bach. Check out this Ted Talk by the author. (Tip: read it in parallel with Scale by Geoffrey West). 10/10.

  

• Alchemy by Rory Sutherland. The author is the vice-chairman of Ogilvy, one of the topmost advertising agencies in the world. A wonderful read on the underappreciated role of perception in creating value. Great ideas on creativity too. Watch some of the author’s talks to get a taste for his ideas (start here and here). My interview with the author here. 10/10.

  

• Surely You’re Joking, Mr. Feynman by Richard Feynman. A compilation of colourful anecdotes from the life of the legendary physicist and teacher. Provides rich insight into the man behind the physics. Read this post by Caltech to understand his personality. 10/10.

  

• The MANIAC by Benjamin Labatut. A fictionalised biography of John von Neumann. In each chapter, the author writes a fictional memoir of von Neumann from a different person’s perspective — so one chapter is ‘written by’ (fictional) Eugene Wigner, another by Richard Feynman, Oskar Morgenstern etc. Really beautiful prose, I finished reading it in 4 days. Hat tip to Jim O’Shaughnessy and

  Gandhar Mahadeshwar for the recommendation. 10/10.

• Feynman’s Rainbow by Leonard Mlodinow. The memoir of someone who was a PhD student at Caltech under Richard Feynman. It is really beautiful to see the mentor-mentee dynamics. 10/10.

  

• The Black Swan by Nassim Nicholas Taleb. One of those ‘big ideas’ books that throws a ton of interesting concepts at you. I loved the ideas about asymmetry, probability and Kolmogorov complexity. 10/10.

  

• A Man For All Markets by Edward Thorp. An autobiography of a brilliant mind, who did a PhD in mathematics, pioneered card counting in blackjack, was the first outside investor in Citadel, and predicted Warren Buffett’s success and Bernie Madoff’s fall decades before they happened — not to mention that he collaborated with Claude Shannon to build the world’s first ever wearable computer. 10/10.

  

• Red Notice by Bill Browder. A memoir that is best described as a non-fiction thriller. A mind-boggling yet true story that goes from investing in Russia to taking on the oligarchs and becoming Putin’s enemy, and implementing the Magnitsky act. The book is unputdownable. 10/10.

  

• Poor Charlie’s Almanack, edited by Peter Kaufman. A compilation of talks and insights from one of my favourite thinkers, Charlie Munger, the business partner of Warren Buffett. Ideally, read the original edition (not the Stripe Press one), since it has lots of fun and aesthetic illustrations. 10/10.

  

• Algorithms To Live By by Brian Christian and Tom Griffiths. A whirlwind tour of theoretical computer science: algorithms (least recently used, merge sort etc.), optimisation (e.g., 37% rule for secretary problem), game theory and much more. Full of very interesting ideas and highly readable too. 10/10.

• Freakonomics by Steven Levitt and Stephen Dubner. An extremely curious mind goes down multiple rabbit holes on interesting economic situations — the organisational structure of criminal gangs, the incentives of real estate agents, why schoolteachers cheat etc. Read this article to get a taste for the ideas. 10/10.

  

• More Money Than God by Sebastian Mallaby. An excellent book on hedge funds. Extremely thoroughly-researched (as is the author’s other book, The Power Law, which I highly recommend too). An absolute page-turner, unputdownable. My interview with the author here. 10/10.

• Capital Returns edited by Edward Chancellor. A collection of investment letters by Marathon Asset Management, expounding their ‘capital cycles’ approach to investing. It has some brilliant insights on the supply side, business quality, capex-to-depreciation ratio etc. 10/10.

  

• Thinking, Fast and Slow by Daniel Kahneman. Full of insights from priming to prospect theory and a whole host of cognitive biases. 10/10.

  

And here are some more books that I enjoyed reading and would recommend:

• Totto-chan: The Sequel by Tetsuko Kuroyanagi. The sequel was published 42 years after the original memoir! The sequel is full of stories of the author’s life during WW II, as well as her career as an actress.

• Richer, Wiser, Happier by William Green. Each chapter profiles a different investor — from John Templeton to Howard Marks to Charlie Munger — and makes for a very interesting read. My favourite chapter is the one about Nick and Zak’s Excellent Adventure; that chapter is a must-read.

• The Joys of Compounding by Gautam Baid. A beautifully written treatise on the wonderful craft of value investing.

• Meditations by Marcus Aurelius. I really appreciate his philosophy of stoicism.

• The Da Vinci Code by Dan Brown. I usually don’t read much fiction, but this book is an unputdownable thriller.

• Investment Biker by Jim Rogers. The author was the hedge fund partner of George Soros at Quantum Fund, and retired at age 37 to travel the world on a motorcycle. The book is a memoir of his travels, filled with insights on each country’s economy and markets — for example, he would observe whether a country has a currency black market (if so, what is the % difference between the black market and the official rate?), New Zealand’s livestock industry, Bolivia’s tin industry, Botswana’s prospects as an emerging economy etc. Many thanks to Ramesh Damani for gifting me this book on 24 December 2020 — best Christmas gift I’ve ever got!

• How To Create A Mind by Ray Kurzweil. Wonderful insights on biological and artificial neural networks — great intro for someone who has never seen these concepts before — e.g., Minsky-Papert theorem which says that XOR (exclusive or) is unsolvable using a single-layer perceptron.

• The Art of Learning by Josh Waitzkin. Superb insights on peak performance, explored through the lenses of chess and martial arts but with ideas that transfer to almost any creative discipline. (Tip: read it in parallel with Rahul Dravid: Timeless Steel, edited by ESPN Cricinfo).

• Finite and Infinite Games by James Carse. A beautiful philosophy of infinite play, built up through logical reasoning from simple axioms.

• Cryptonomicon by Neal Stephenson. A mix of cryptography, information theory, currencies, and WW II military strategy, written as fiction. Are human brains universal Turing machines?!

• The Overcoat by Nikolai Gogol. Really beautiful prose, wonderful short story.

• Prisoners of Geography by Tim Marshall. Very interesting insights on the actual role of geography in geopolitics. For example, Russia’s weak point geographically is its western border.

• Moneyball by Michael Lewis. The story of how a struggling baseball team turned around their fortunes by using statistics. The book goes into much more detail than the movie (which is itself superb).

• A Beautiful Mind by Sylvia Nasar. A biography of legendary mathematician John Nash, famous for the Nash equilibrium in game theory. The book goes into much more detail than the movie (which is itself superb).

• The Biography of a Failed Venture by Prashant Desai. A wonderfully-written memoir about the author’s failed startup.

• Superforecasting by Philip Tetlock and Dan Gardner. How anyone can consistently make accurate predictions. Makes for an even more interesting read in today’s times of buoyant prediction markets.

• Invent & Wander by Walter Isaacson. A compilation of Amazon’s shareholder letters. Great insights on the company’s culture, from customer focus to ‘always day one’.

• The Outsiders by William Thorndike. An account of eight unconventional CEOs who were exceptional capital allocators, from Henry Singleton to Warren Buffett.

• The Price of Time by Edward Chancellor. A well-written history of interest rates and their significance.

• The Spy Who Came In From The Cold by John le Carré. A fascinating novel about the workings of intelligence agencies.

• The Celestine Prophecy by James Redfield. Not the best prose, but has some wonderful insights on energy fields.

• The Joy of X by Steven Strogatz. Brings out the fun and beauty of mathematics.

• Infinite Powers by Steven Strogatz. I fell in love with calculus after reading this book.

• Elon Musk by Walter Isaacson and Elon Musk by Ashlee Vance. Both biographies are well-written.

• The Power Law by Sebastian Mallaby. Wonderful history of venture capital.

• Roller Coaster by Tamal Bandyopadhyay. Insider stories of Indian bankers and RBI governors from Uday Kotak to Raghuram Rajan and beyond, makes for a fun read. The author is a leading journalist covering the Indian banking sector.

• The Ambuja Story by Narotam Sekhsaria. A memoir about the founding story and journey of Ambuja Cements.

• Leonardo da Vinci by Walter Isaacson. A wonderful biography of a brilliant polymath.

• R. N. Kao: Gentleman Spymaster by Nitin Gokhale. A biography of Rameshwar Nath Kao, the founding chief of the Research and Analysis Wing (R&AW), India’s intelligence agency.

• Megatrends: Ten New Directions Transforming Our Lives by John Naisbitt (the original 1982 book). It predicts so many big-picture trends, like the shift from top-down to bottom-up, and the shift from either-or to multiple-choice.

• Logicomix by Apostolos Doxiadis and Christos Papadimitriou. A really fun comic book about mathematician and philosopher Bertrand Russell’s life.

• Deep Work by Cal Newport. A book that has greatly influenced my workflows.

• Scale by Geoffrey West. ‘Big ideas book’ with superb insights from invariance of terminal units to scaling laws.

• The World For Sale by Javier Blas and Jack Farchy. Superb book about commodity traders.

• The Founders by Jimmy Soni. The founding story of PayPal, really well-written.

• The Almanack of Naval Ravikant by Eric Jorgenson. Classic, full of insights. I especially appreciated the point about permissionless leverage.

• The Anthology of Balaji by Eric Jorgenson. Full of fascinating ideas; I especially enjoyed his ideas on the importance of good writing about technology.

• How To Lie With Statistics by Darrell Huff. Very short and fun read on how statistics can be massaged to appear better than they are.

• Guns, Germs and Steel by Jared Diamond. Well-researched and well-written book, though I disagree with his conclusion that geography is destiny.

• The Math Book by Clifford Pickover. A whirlwind tour of various concepts in math — one page and one picture for each concept, from Pythagoras’ theorem to Euler’s identity. Fun read.

• How Asia Works by Joe Studwell. Interesting insights on industrial policy and how it created economic prosperity in China, Japan, Taiwan and South Korea.

• The Everything Store by Brad Stone. Interesting book about the founding story of Amazon — it was originally going to be called Cadabra or MakeItSo; the domain name relentless.com redirects to Amazon; Jeff Bezos never takes the elevator, always stairs.

• The Lords of Easy Money by Christopher Leonard. Well-written book about money supply and the problems created by excessive money printing (quantitative easing).

• Gautam Adani by R. N. Bhaskar. The story of the Adani group, very insightful read.

• Buffett by Roger Lowenstein. Good biography of Warren Buffett.

• What You Are Looking for Is in the Library by Michiko Aoyama. Wonderful novel about a librarian who has a knack for recommending the perfect book to her patrons.

Here is my Goodreads account.

I always enjoy discussing ideas, so feel free to reach out!

Feedback and reading recommendations are invited at malhar.manek@gmail.com

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