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# Risk, Information, Time and Money (in 20 Minutes) by Dan Milstein

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Risk, Information, Time and Money (in 20 Minutes) by Dan Milstein

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### Risk, Information, Time and Money (in 20 Minutes) by Dan Milstein

1. 1. Risk, Information, Time & Money (In 20 Minutes) Dan Milstein @danmil Hut 8 Labs Tuesday, December 17, 13
2. 2. First Principles = Win Tuesday, December 17, 13
3. 3. 1. Opportunity Cost Tuesday, December 17, 13
4. 4. Hut 8, Two Offers Tuesday, December 17, 13
5. 5. Client A: PSD’s -> HTML Tuesday, December 17, 13
6. 6. \$20/hour Tuesday, December 17, 13
7. 7. 8 hours of work/day Tuesday, December 17, 13
8. 8. Client B: BIG DATA Tuesday, December 17, 13
9. 9. \$200/hour Tuesday, December 17, 13
10. 10. 4 hours of work/day Tuesday, December 17, 13
11. 11. WHAT DO WE DO?!? Tuesday, December 17, 13
12. 12. Math 200 * 4 = 800 20 * 8 = 160 Tuesday, December 17, 13
13. 13. Opportunity Cost: \$640/day per person Tuesday, December 17, 13
14. 14. This is happening at your startup Tuesday, December 17, 13
15. 15. 10 people, 1 year Series B Valuation: Tuesday, December 17, 13
16. 16. \$20,000,000 Tuesday, December 17, 13
17. 17. \$20,000,000 or \$0 Tuesday, December 17, 13
18. 18. Opportunity Cost: \$8,000/day per person Tuesday, December 17, 13
19. 19. \$8,000/day Tuesday, December 17, 13
20. 20. Axiom 1: It’s not all luck Tuesday, December 17, 13
21. 21. Axiom 2: Teams that fail, work hard Tuesday, December 17, 13
22. 22. Be terriﬁed of: Tuesday, December 17, 13
23. 23. Working on wrong things Tuesday, December 17, 13
24. 24. Don’t worry about: Tuesday, December 17, 13
25. 25. Working hard Tuesday, December 17, 13
26. 26. EVERYONE GETS THIS WRONG Tuesday, December 17, 13
27. 27. 2. Information & Money Tuesday, December 17, 13
28. 28. What if clients hide the rate? Tuesday, December 17, 13
29. 29. Spend a week researching Tuesday, December 17, 13
30. 30. That week makes us money Tuesday, December 17, 13
31. 31. Like, real money Tuesday, December 17, 13
32. 32. + Information Decision Money Tuesday, December 17, 13
33. 33. 3. Risk & Information Tuesday, December 17, 13
34. 34. Chained Risks Tuesday, December 17, 13
35. 35. 1) Can we build it? 2) Will people buy it? Tuesday, December 17, 13
36. 36. Two Startups Tuesday, December 17, 13
37. 37. A) Teleportation Tuesday, December 17, 13
38. 38. B) Enterprise CRUD App Tuesday, December 17, 13
39. 39. Teleportation: try to build Tuesday, December 17, 13
40. 40. CRUD app: try to sell Tuesday, December 17, 13
41. 41. What is different? Tuesday, December 17, 13
42. 42. Degree of Surprise Tuesday, December 17, 13
43. 43. Information = Surprise Tuesday, December 17, 13
44. 44. Claude Shannon is a boss Tuesday, December 17, 13
45. 45. “A startup is a temporary organization formed to search for a repeatable and scalable business model.” - Steve Blank (also a boss) Tuesday, December 17, 13
46. 46. 4. Information & Time Tuesday, December 17, 13
47. 47. Rates of Change FTW Tuesday, December 17, 13
48. 48. Velocity = Meters/Second Tuesday, December 17, 13
49. 49. Velocity = Distance/Time Tuesday, December 17, 13
50. 50. Revenue = Dollars/Month Tuesday, December 17, 13
51. 51. Revenue = Money/Time Tuesday, December 17, 13
52. 52. Information = Money Tuesday, December 17, 13
53. 53. Revenue = Information/Time Tuesday, December 17, 13
54. 54. Again, real money Tuesday, December 17, 13
55. 55. 5. Risk, Information & Time Tuesday, December 17, 13
56. 56. Here’s where it gets fun Tuesday, December 17, 13
57. 57. Example: Health IT Tuesday, December 17, 13
58. 58. Velocity (aka Revenue): Organizational response to changing nature of risks Tuesday, December 17, 13
59. 59. NOBODY GETS THIS Tuesday, December 17, 13
60. 60. In Summary: Tuesday, December 17, 13
61. 61. In the presence of extreme uncertainty, you make money by extracting information from reality. Tuesday, December 17, 13
62. 62. In the presence of extreme uncertainty, you make money by extracting information from reality. The most valuable information is that which reduces uncertainty about the largest in a chain of risks. Tuesday, December 17, 13
63. 63. In the presence of extreme uncertainty, you make money by extracting information from reality. The most valuable information is that which reduces uncertainty about the largest in a chain of risks. To acquire information quickly, the whole team must constantly adjust its understanding of risks. Tuesday, December 17, 13
64. 64. 6. Fear Tuesday, December 17, 13
65. 65. Leaders & Fear Tuesday, December 17, 13
66. 66. “Vision” Tuesday, December 17, 13
67. 67. Go Forth and Win Tuesday, December 17, 13
68. 68. Putting Principles Into Practice @hut8labs http://blog.hut8labs.com Tuesday, December 17, 13
69. 69. Putting Principles Into Practice @hut8labs http://blog.hut8labs.com Tuesday, December 17, 13
70. 70. Putting Principles Into Practice @hut8labs http://blog.hut8labs.com Tuesday, December 17, 13