Naval Ravikant

Naval Ravikant quotes on business model

Indian-American entrepreneur and investor. He is the co-founder, chairman, and former CEO of AngelList.

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1

A firm is just a "nexus of contracts." Payroll contracts with employees, profit contracts with shareholders, debt contracts with lenders, delivery contracts with customers, tax contracts with the state. Blockchain-based "smart" contracts will eventually reinvent the firm.

2

The lockdowns are intensely pro-tech. They forcibly accelerate tech adoption and cure the industry of its collective addiction to industrial-era offices.

3

You build a model to figure out which assumptions drive the model.

4

An individual’s values, a company’s mission, and a nation’s constitution, all attract long term players playing long term games.

5

People who deal with nonlinearities regularly (startup investors, gamblers, complexity researchers, epidemiologists) know that models are far too sensitive to assumptions to be taken literally. All models do is help you decide when to flip from panic to greed and back to panic.

6

Physical monopolies (phone company, electric utility) aggregate supply and raise prices. They underpay for demand and make excess profits. Digital monopsonies (search engine, social network) aggregate demand and lower prices. They underpay for supply and make excess profits.

7

Universities, Incubators, and Venture Capital firms are really “Curation Businesses.”

8

If you're capable, you can do business with sharks. But the attitude and habits that you develop will scare away honest partners later.

9

All models rely on a small set of critical assumptions. A good (simple) model uncovers them, while a bad (complicated) model obscures them.

10

Scaling a company via code and contracts instead of via people mitigates the Principal-Agent problem. Scaling via community-generated code and content mitigates Hayek’s Local Knowledge problem.

11

Ironic that the most monetizeable code in the world is now open source (running on blockchains). OSS has the best business model.

12

Contrast business models: • Ad based: More experienced users click on less ads. • On-demand services: More experienced users increase usage.

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