Thanks for being here!
Announcements:
Check out my recent conversation with Matthew Bernath about Alternative Data in Financial Modelling (summarized below).
Check out a trial of 90 West’s aggregated consumer data via Exabel.
Our transaction data is now available at more granular “row level”.
Gift card data now available for individual companies.
Contact me to learn more.
Quotes
“Becoming a technologized investor is really to say asset managers and owners need to become more like information technology companies than traditional investment companies and start using different tools, analytics and data sets.”
Theme that emerged in this week’s email is … new tech tools are broadening access to data…moats are being formed.
News Articles
Podcasts
Cool Charts
Final Thoughts (Luck)
#1 – Amanda White of Top1000Funds.com published Why asset owners need to become ‘technologized investors’. February 2023.
My Take: I highlighted the above quote from this article. The bottom line is the world is changing, much more data is available, and the tools to interpret the data are improving. Institutional investors need to engage just to keep up, much less stay ahead. Herman Bril, co-author of Sustainability, technology and finance: Rethinking how markets integrate ESG, is quoted throughout the article. He poses the right questions: “…how do you take that (data) into your systems and benefit from that? How do you build insightful information with all this data suddenly available?”
#2 – Doug Laney published Data Collateralization: How to Decide the Value of This Intangible Asset. February 2023.
My Take: Every company is a data company & every company’s data has value. How much value remains the question. If we can do a better job assigning market value, companies has another asset against which they can borrow and grow. “Market value” is not a small question and takes time to figure out. As tools get better & data marketplaces demonstrate some liquidity, we should move in the direction of having “data” as a balance sheet line item for all companies.
#3 – Vivek Ramaswami & Sabrina Wu published Moats in the Era of AI. January 2023.
My Take: I came across this thought provoking article as i continue to think about creating moats around data business. All five of the standard business moats can be associated with data businesses.
Intellectual Property & Technology (proprietary data sources or proprietary way of organizing data)
Network Effects; Data > User (If your competitor/colleague is benefitting from data, you need it to)
Distribution (get in front of more people, make data engagment part of day-to-day)
User Experience (how easy for non-data people to engage)
Reinforcement Learning With Human Feedback; RLHF (iterative improvement)
BONUS: ResearchAndMarkets.com published Data Marketplace Platform Global Market to Reach $3.5 Billion by 2028. February 2023. This represents nearly 25% CAGR through 2028.
BONUS 2: Seattle Data Guys The Kid Gloves Are Coming Off In The Data World. February 2023. “I think many of us in the data world have been waiting for this--consolidation.”
BONUS 3: The IMF published Scaling up Climate Finance for Emerging Markets and Developing Economies. February 2023. “There is a significant scarcity of high quality and reliable data, harmonized and consistent set of climate disclosure standards, and taxonomies to align investments to climate-related goals.”- Bo Li (IMF’s Data Gaps Initiative)
#1 – My conversation with Matthew Bernath on his Financial Modelling Podcast. February 2023.
My Take: I’ve enjoyed being a guest on the few podcast I have done. This was no different. I like the format of a short podcast. Very high level discussion about alt data and how one might include in current financial models. Short answer: another data point for the decision-making mosaic.
Highlights (13-minute run time):
Minute 00:30 – intro & background
Minute 03:00 – overview of gift card market in the US
Minute 04:30 – the importance of increased frequency of data insights
Minute 07:00 – how is alternative data marketed & sold?
Minute 08:40 – how does an investor get access to and use alternative data?
Minute 10:45 – How to develop trust in the data?
Source: Forester via Crux: Automate And Optimize Data Engineering To Accelerate Time To Value With External Data Sets. February 2023.
We as data practitioners are still trying to figure out how to make the entire process easier.
Most time is spent wrangling data and not deriving insights.
How are companies planning to do this?
Source: How to be Lucky & increase you odds of serendipity.
A big part of being lucky is carrying an optimistic outlook with you. The study cited in the NYT article linked above makes the point that two people dropped in the same situation will have different outcomes simply due to outlook.
The term serendipity is tied back to an ancient story about The Three Princes of Serendip. The punch line is these three princes travel around and have adventures which largely involve “happy accidents”. The story ultimately inspires 1700’s era author Horace Walpole to use the English language term serendipity to describe such luck.
In the story, the Three Princes leave town, meet people, engage with positive curiosity, and have adventures. Correlated to modern times, they got off the couch, put their phones down, and engaged with interesting people doing interesting things. “Have a bias towards action”.
The term is often associated with great inventions, where perhaps an inventor was tinkering and randomly develops what becomes a brilliant product (penicillin, Velcro, Post-It Notes, etc).
I would argue the same goes with sales & business development. Just like an inventor might never develop that great new product if they aren’t constantly tinkering … in a role where new ideas & contacts might change the course of your business (or life!), being engaged in the market via networking, sharing ideas in public, and helping people, makes all the difference.
And lastly, be a genuinely good person. People will want to help you and see you succeed.