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I’ve been in stealth mode for the past year doing a new thing for me — I wrote a book!!
Scott Cook and @WalterIsaacson separately challenged me to write a book about the secret sauce behind Tesla's success.
It’s titled “The Algorithm.”
The book will be published on March 24, and you can preorder The Algorithm today: dvx.ventures/the-algorithm
Jon McNeill retweeted
Former Tesla President @jonmcneill breaks down China's strategy to dominate the global auto industry:
Every five years, China selects five industries to enter and dominate.
They subsidize ~100 market entrants, and let competition play out.
That gets whittled down to the top 3–5 winners. In this case: BYD, Geely, and NIO.
Then they consolidate capacity under those winners—effectively handing them the infrastructure built by the entire field—and tell them: your job now is to export and dominate these markets.
"So—they've gotten subsidies to get started, subsidies to operate and now they're getting capacity for free. And they've proven themselves as the winners in a hyper competitive market. And now they go enter the rest of the world where the competitors are soft."
"That's their formula, and they run this formula across all kinds of industries: solar panels, TVs, bicycles, and electric cars. It's a very powerful flywheel."
1/ The most important thing for me when writing The Algorithm was this chair. I’m not a natural writer, and waiting for inspiration to hit became a constraint.
2/ So I removed the constraing and created a routine that became critical for getting in the zone. Sitting down to write in the same place every day gave me structure. Every time I sat down in that chair, I knew what I was there to do.
3/ Pre-orders are open now: dvx.ventures/the-algorithm
I've been cautious about weighing into the discussion on the Boston ecosystem, but with people I really respect, like @bhalligan opening the door, here are some of my observations.
I don't believe this is about taxes or housing costs (they are both way higher in the Bay Area). With experience in both Boston and Bay Area ecosystems, my take on where Boston needs to close gaps are:
1) VC Risk appetite -- this is so starkly different between markets, it's stunning. We'll show one of our seed companies to multiple Boston VCs and get very detailed questions on sales productivity, sales motion, etc - basically risk mitigation questions. It's seed and these are companies growing 100% with millions of $'s in revenue. We show them to SF VCs and the questions are about the team, how big can this be, and terms are on the table in the first meeting. This has to get fixed -- no amount of adding YC or others to the ecosystem will address the lack of VC aggression in Boston. West Coast VCs -- come east, the market is large and vulnerable to your competition!
6). Ambition: both founders and VCs in Boston need to default to building big, change the world companies with world class talent. Settling for singles and doubles does not provide the wealth compounding necessary to grow the ecosystem.
I'm certain that this list is incomplete, so please add your thoughts. We're very lucky to have @epaley on the case in Massachusetts and need entrepreneurs in MA get behind his efforts.
1/ I didn’t want to write a book. I’ve never really loved writing. And I’m an entrepreneur, not an author.
4/ If they can do it, you can too. Pre-orders are open now: dvx.ventures/the-algorithm
Autonomy isn’t optional. It’s existential.
@edels0n asks the right questions on ProfG Markets on what this means for automakers, regulators, and investors over the next decade.
When I wrote The Algorithm, I wanted to highlight the framework behind the innovative people behind the scenes at Tesla — the unsung heroes.
Step 3 of The Algorithm is to launch a new process manually and wait to automate until you absolutely have to.
Jerome Guillen saved Tesla by doing exactly this. The Model 3 launch had over-automated an untested production line. With no cars coming out and cash dwindling, Jerome led the build of a tent outside the factory to manually build the Model 3. His thesis was that we’d skipped a step — we hadn’t actually optimized the process manually before automation. We had to reverse course and nail the process first.
In 11 days, his team built the tent and unlocked huge innovations in automotive production. Model 3s started to flow off the line, and eventually, the Shanghai factory was built on the breakthroughs achieved in that tent.
Get it right manually first, then automate. Totally counterintuitive. And it changed all of our thinking.
Pre-order today: dvx.ventures/the-algorithm.