David Lin

@Vivek4real_ @mert @arjunkhemani you’re up

🇺🇸 BILLIONAIRE CHAMATH PALIHAPITIYA DROPPED A MASSIVE WARNING AGAINST BITCOIN: “THERE’S A STRUCTURAL FLAW IN BITCOIN.” “BITCOIN LACKS FUNGIBILITY AND PRIVACY.” “IT CAN NEVER BE A HOLDING OF A CENTRAL BANK.”

@rationalaussie What would you suggest they do?

Australia has zugzwanged itself into an enormous hole. Raising taxes to fund a Ponzi scheme collapses the very Ponzi scheme they are trying to fund. No way out

@buccocapital Which model are you finding works best for this Deep Research prompt today?

I’ve found this Deep Research prompt to be a decent way to get up to speed on any company. Very little focused on valuation, more of a holistic overview I can’t for the life of me remember where I found the original seven-point framework/template but I fleshed it out to 13 to hit the areas I felt were important. If anyone recognizes it, please link/tag the creator ————— Analyze [Ticker] using the 13-point framework below. - Use only verifiable, factual information (annual reports, investor presentations, filings, earnings transcripts, and reputable financial sources). - Be concise, analytical, and concrete, with no filler or marketing language. Output format (exact structure required): Executive Summary (about 150–200 words) Summarize in plain English how this company makes money, its economic quality, and where its edge and risks lie. End with one sentence that describes the business to an investor in one line. 1. What They Sell and Who Buys * Describe the main products or services. * Define target customers by type, segment, and geography, and why they buy, including the main pain point or motivation. 2. How They Make Money * Explain the revenue model and pricing logic. * Clarify whether revenues are one-time, recurring, transaction-based, or hybrid. * Include key revenue segments and their share if available. 3. Revenue Quality * Assess how predictable and diversified revenues are. * Break down recurring versus one-off components, customer or segment concentration, and exposure to economic cycles.
 4. Cost Structure * Outline major cost drivers, such as COGS, labor, logistics, marketing. * Include gross and operating margins where possible. * Comment on scalability, fixed versus variable costs, and how margins move with growth.
 5. Capital Intensity * Describe the assets needed to run and grow operations. * Include capital expenditure levels, working capital needs, and cash conversion efficiency.
 6. Growth Drivers * Identify the main levers for revenue growth, such as volume, pricing, product mix, geographic expansion, or acquisitions. * Clarify whether each driver is structural and long term or cyclical and short term.
 7. Competitive Edge * Explain what protects the company’s economics from competition, such as brand, cost advantage, switching costs, regulation, network effects, data, or intellectual property. * Discuss how durable and testable this moat appears, using financial evidence such as margins, ROIC, or customer retention.
 8. Industry Structure and Position * Describe the industry value chain and where profit pools sit. * Explain market structure, for example fragmented or consolidated, presence of pricing power, and key regulatory factors. * Place the company within this context, including market share, relative scale, and whether it acts as a price setter, a price taker, a niche specialist, or a platform. 9. Unit Economics and Key KPIs * Present unit economics at the relevant level, such as per customer, store, device, transaction, or cohort. * Include metrics such as CAC, LTV, churn or retention, ARPU, utilization, occupancy, and payback periods where applicable. * Comment on whether these unit economics and KPIs are improving, stable, or weakening over time.
 10. Capital Allocation and Balance Sheet * Summarize historical capital allocation across organic investment, acquisitions, buybacks, dividends, and debt reduction. * Describe balance sheet strength, including leverage, debt maturity profile, liquidity, and any major off balance sheet obligations. * Assess whether capital allocation has likely created or destroyed value. 11. Risks and Failure Modes * Identify key risks, such as competitive, technological, regulatory, macroeconomic, customer concentration, or currency exposure. * Describe in simple terms how the equity story could fail, and what would need to happen for this to occur. * Highlight areas where uncertainty is especially high or information is limited. 12. Valuation and Expected Return Profile * Compare current valuation with the company’s own history and with peers, using the metrics that best fit this business, such as P/E, EV/EBIT, EV/Sales, FCF yield. * Provide a simple scenario framework with bear, base, and bull cases, including rough assumptions and implied upside or downside. * State explicitly what must be true for the current price to be attractive, fair, or expensive. 13. Catalysts and Time Horizon * List near and medium term catalysts, such as product launches, margin inflection, regulatory events, refinancing, or index changes. * Note any slow building catalysts, such as mix shift or operating leverage that accumulates over time. * Explain the expected time horizon for the thesis to play out and how the market is likely to recognize the value if the thesis is correct. Tone: Analytical, neutral, precise. Goal: Produce a concise yet rich narrative that lets an investor understand how this business works, how resilient and valuable its economics are, and whether the stock looks attractive at today’s price.

@drowsyinvestor @investing_bear @JoshIsner All good! As they say, there's a million ways to make money.

@mrdlin @investing_bear @JoshIsner Yes precisely. I know that’s not the most quantitive approach or answer.

JUST RELEASED: “Episode 21: Josh Isner on Axon’s Journey and Future” on Shooting the Bull with Drowsy and Bear @investing_bear and I have $AXON President @JoshIsner to discuss why Axon has passed an inflection point. A must listen for all investors. 👊 open.spotify.com/episode/615fr4…

@drowsyinvestor @investing_bear @JoshIsner Thanks Drowsy, appreciate the thoughtful response. Just so I'm clear, it sounds like you're not really anchoring around a specific valuation and instead focused on business quality and execution? And assuming the value creation will take care of returns over the long term?

That’s an excellent question. And I think there’s a range of possibilities. For me, I keep tabs on multiples but that doesn’t heavily influence my $AXON thinking. TAM is so hard to calculate with so many growth drivers and now several markets. For me I really just focus on execution and what customers say/buy. Now that doesn’t get exactly towards valuation… but does give you some idea on health of company. I think @investing_bear focus on trimming and adding is a good approach with Axon. The stock at times has by any metric been greatly overvalued and conversely seemingly undervalued at times. And when that gets egregious you act.

@GavinSBaker @SpaceX SpaceX is a knowledge creation machine. This thing will keep compounding for 100+ years. The TAM literally is the entire universe.

Really fun to interview my old friend Bret Johnsen in Mission Control. Three parts of the @SpaceX story that I wish were more widely discussed: SpaceX has created thousands of good blue-collar jobs: welders, machinists, electricians. Everyone talks about the need to bring high-paying, blue-collar jobs back to America. SpaceX and Tesla are making that happen. To the best of my knowledge, they have created more manufacturing jobs in the US than just about any other American company over the last ten years. It’s hard to imagine our nascent industrial renaissance succeeding without these companies. SpaceX was started with the goal of putting humans on Mars. And along the way, they have massively improved life for many humans on Earth. Mars may be a starter planet, but Earth is our planet, and the technologies developed at SpaceX are already in use today connecting and safeguarding the people of Earth. Starlink is a really efficient way to bring internet to low-income countries. In Kenya’s remote Murang’a County, Starlink has made it possible for patients in rural villages to consult with medical specialists via telemedicine. In the rainforests of Brazil, Starlink has connected schools to reliable high-speed internet that will provide more educational opportunities to students. Here in America, Starlink has proven vital to emergency teams responding to natural disasters. During Hurricane Helene, the Starlink hubs dropped into North Carolina and East Tennessee were often the only contact point between cut-off towns and the outside world. Literally life-saving. This IPO will be a big milestone for the company. It’s important to celebrate this, while also remembering that making humanity multi-planetary is the ultimate goal. Going to Mars is really hard. There have been many setbacks thus far, ranging from fiery explosions to failed landings. There will be many more. Ad Astra Per Aspera. But SpaceX is at its best *after* a setback imo. Their first 3 launches were “failures”. Had the 4th not succeeded, there might not be a SpaceX today. The company’s success in the face of such daunting odds is a testament to the resilience of the culture and absolute commitment to the mission shared by every employee I’ve ever spoken with. Some of the world’s most talented engineers have chosen to live in Airstreams at Starbase away from their families for weeks on end in service of this goal. I will never forget the welders who told me they signed every weld because they wanted to be accountable if they were responsible for a failure. True missionaries, all of them. I am grateful to every single person at SpaceX for helping to make the future as inspirational as possible. And I will be even more grateful if I get to see a blue sunset on Mars! More info on spacexipo.com

@NickADobos No idea if $1.75 billion is the right valuation or not, but I think SpaceX will continue compounding for 100+ years. It's a knowledge creation machine and the Universe is the TAM.

If you could only buy one IPO ?

@nachkari Upon further consideration, it seems like I made an erroneous assumption. I believe the US savings rate went up during COVID. Different circumstances (people couldn't spend etc.), but that data point contradicts my theory. Perhaps you're right about demand destruction.

@nachkari Hmm, my theory is it reduces consumption of fast food, alcohol etc. But those dollars saved will instead get spent on other products and services. Otherwise, the savings rate amongst GLP-using population would go up, which seems to go against human nature?

@nachkari That consumption will simply redirect from certain parts of the economy to others. I’d call it demand ‘diversion’.

@trengriffin I’ve recently thought podcast interviews are similar to prompting LLMs. Good interview questions are similar to good prompts. Both are capable of extracting knowledge from a probabilistic system. Sometimes, can knowledge extracted can be unexpected for the interviewee!

The mass of artifacts before tokenization is analogous to raw bauxite. The digital smelter extracts tokens from the bauxite which turn meaning into vector coordinates which when combined with computation (enabled by electricity) generates the outputs from the models.

If: Aluminum = electricity in solid form are Tokens = computation/meaning in digital form? A raw substrate exists in each case:: 1) ore for aluminum; 2) human artifacts like text, images and video for tokens. A transformer (the neural network) is digital smelter.

@brivael Beautifully written.

Elon Musk avait dit un truc qui m'avait marqué sur l'allocation de ressources. En substance : passé un certain niveau de richesse, l'argent n'est plus de la consommation, c'est de l'allocation de capital. Cette phrase change tout. L'économie, dans le fond, c'est juste un problème d'allocation. Tu as des ressources finies et des usages infinis. Qui décide où va quoi ? Imagine une cour de récré. 100 enfants, des paquets de cartes Pokémon distribués au hasard. Tu laisses faire. Très vite, un ordre émerge. Les bons joueurs accumulent les cartes rares, les collectionneurs trient, les négociateurs trouvent des deals. Personne n'a planifié. Et pourtant chaque carte finit dans les mains de celui qui en tire le plus de valeur. Le système maximise le bonheur total de la cour. C'est ça, la main invisible. Maintenant fais entrer la maîtresse. Elle trouve ça injuste. Léo a 50 cartes, Tom en a 3. Elle confisque, redistribue, impose l'égalité. Trois effets immédiats. Les bons joueurs arrêtent de jouer, à quoi bon. Les mauvais n'ont plus de raison de progresser, ils auront leur part. Les échanges s'effondrent. La cour est égale, et morte. Elle a maximisé l'égalité, elle a détruit le bonheur. Le problème de la maîtresse, c'est qu'elle ne peut pas avoir l'information que la cour avait collectivement. C'est le problème du calcul économique de Mises, formulé en 1920. L'URSS a essayé de le résoudre pendant 70 ans avec le Gosplan. Résultat : pénuries, queues, effondrement. Pas parce que les Soviétiques étaient bêtes, parce que le problème est mathématiquement insoluble en mode centralisé. Quand Musk a 200 milliards, il ne les consomme pas, il les alloue. SpaceX, Starlink, Neuralink, xAI. Chaque dollar est un pari sur le futur. Et lui a un track record. PayPal, Tesla, SpaceX. Il a démontré qu'il sait identifier des problèmes immenses et y allouer des ressources avec un rendement spectaculaire. L'État aussi a un track record. Hôpitaux qui s'effondrent, éducation qui décline, dette qui explose, services publics qui se dégradent malgré des budgets en hausse constante. Le marché identifie les bons allocateurs, la politique identifie les bons communicants. Le profit n'est pas une finalité, c'est un signal. Il dit : tu as alloué des ressources rares vers un usage que les gens valorisent suffisamment pour payer. Plus le profit est gros, plus la création de valeur est grande. Quand Starlink est rentable, ça veut dire que des millions de gens dans des zones rurales ont enfin internet. Quand un ministère est en déficit, ça veut dire qu'il consomme plus qu'il ne produit. L'un crée, l'autre détruit, et on appelle ça redistribution. Dans nos sociétés il y a deux catégories d'acteurs. Les entrepreneurs et les bureaucrates. L'entrepreneur prend un risque personnel pour identifier un problème, mobiliser des ressources, créer une solution. S'il se trompe il perd. S'il a raison, ses clients gagnent, ses employés gagnent, ses fournisseurs gagnent, l'État collecte des impôts. Il est la cellule de base du progrès humain. Le bureaucrate ne prend aucun risque personnel. Son salaire est garanti. Au mieux il maintient une rente existante. Au pire il la détruit par excès de réglementation, mauvaise allocation forcée, incitations perverses qui découragent ceux qui produisent. Mais dans aucun cas il ne crée. Regarde les 50 dernières années. iPhone, internet civil, SpaceX, Tesla, Google, Amazon, Stripe, mRNA, ChatGPT. Toutes des inventions privées, portées par des entrepreneurs, financées par du capital risque. Pas un seul ministère n'a inventé quoi que ce soit qui ait changé ta vie au quotidien. La France est devenue le laboratoire mondial de la dérive bureaucratique. 57% du PIB en dépenses publiques, record absolu. Une administration tentaculaire, une fiscalité qui pénalise la création de richesse. Résultat : décrochage face aux États-Unis, à l'Allemagne, à la Suisse. Fuite des cerveaux. Désindustrialisation. Dette qui explose. Et le pire c'est que la mauvaise allocation s'auto-renforce. Plus l'État prélève, moins les entrepreneurs créent. Moins ils créent, moins il y a de base fiscale. Plus l'État s'endette et taxe. Boucle de rétroaction négative parfaite. La maîtresse pense qu'elle aide, et chaque année la cour produit moins. Dans nos sociétés, ce sont les entrepreneurs, toujours, qui font avancer la civilisation. Les bureaucrates au mieux maintiennent une rente, au pire la détruisent. Aucune société n'a jamais progressé en taxant ses créateurs pour subventionner ses gestionnaires. La question n'est jamais qui a combien. C'est qui alloue le mieux la prochaine unité de ressource pour maximiser le futur de l'humanité. La réponse depuis 200 ans n'a jamais changé. Ce ne sont pas les fonctionnaires.

@davidsenra @EricJorgenson @elonmusk I came across this written by IKEA founder Ingvar Kamprad and thought you’d like it

.@EricJorgenson on why @elonmusk's real superpower isn't his vision — it's being incentivized to make the impossible cheap: "Elon went to the people actually awarding contracts and said 'We want an outcome-based contract. I want to be incentivized to drive down the cost. I want to be incentivized to hit the deadlines.'" "For all the talk that happens about him doing things that have never been done before — the things that he's doing that have never been done before are because he drives cost down." "He drives cost down because the vision is not 'make as much money as I can.' It wasn't 'start a new aerospace company that's as profitable as possible.' It was 'get us to Mars' — which means drive down the cost of getting a payload off Earth as low as possible." "That is a heroic thing to go in and say: 'I know I could get paid X to do mediocre work, but I actually want to take the risk. I want to burn the boats. I want my back to the wall. I want to know that we have to clear this threshold that nobody has ever crossed before.'" "And I want to go tell my team that — because that's how we're actually going to achieve this objective that everybody thinks I'm crazy for setting."

@JasonYanowitz How many people need to send cash to their mom in Guatemala? They have $1.7B net debt, meaning enterprise value is $4.4B. Earnings were $500m in 2025, so they’re really trading at 9x P/E. Risk/reward doesn’t seem that great to me.

@JasonYanowitz All true. However, crypto doesn’t solve WU’s structural issues. They are losing share in their most profitable corridors. Yes, USDPT should help lower costs and *slow* the bleeding, but their core markets aren’t growing.

My fireside chat with the CEO of Western Union. > you crypto people think real time settlement is new > we've been doing real time settlement for 20 years > you can go to a WU and send money to your mom in guatemala and it lands in 3 seconds > but that only happens because I have liquidity pool of $1.5B > stablecoins are going to give me back that $1.5B > my stock trades at $2.7B > I'm going to take that $1.5B and use it to buy back a boat load of my stock > oh and also, we're going to use stablecoins to give all 100m+ customers a US dollar debit card aka mini bank account Stablecoins aren't going to kill Western Union... They're going to save it.

@KyleSamani What do you think the company is worth today given its future prospects?

4/ I continue to be blown away by the incredible long time horizon and focus on scaling atoms strategically {fin}

0/ One of the things I think most people consistently misunderstand about Elon is that he is playing the game at a scale that no one else is. Examples:

@nymbusjp Another great article. However, I believe the use of the term “moat” is misleading here. Whilst it’s well known that it was difficult to enter the auto industry, none of the incumbents enjoyed high returns on capital - meaning they didn’t have a moat. Ferrari being the exception.

@buccocapital @jasonlk @travisk Love your work. What are your largest positions?

@jasonlk @travisk I’m certainly not pounding the table and have very little exposure to SaaS. Just reasoning through things out loud. Pushback always welcome

People are destroying SMB B2B software but there’s a meaningful chance HUBS/INTU are AI winners: I was listening to @travisk who recently said: “LTV:CAC with a sales machine, especially if you go [after] small businesses, is life on hard mode. Anybody who’s crushed it on SMB, those guys are special individuals who've made that happen. Because life in the SMB B2B world is no joke." Hard mode. Sounds moaty to me. Some thoughts on how the market could be wrong re: HUBS/INTU 1. SMB is brutally, brutally hard to make the math work, so counter intuitively there’s less competition. And in some sense the survivors are anti-fragile. They keep consolidating share during downturns 2. They have aggregated the customers and have the scale economics 3. AI will encourage full-platform adoption as agents benefit from max surface area and clean data 4. SMB are less tech savvy. Will just want tech that works. 5. Can either roll up space or launch incremental features cheaply w AI 6. Low cost/freemium competition is not new. Vibe coding doesn’t change that. 7. AI will cause an explosion in small business creation

@nymbusjp Another fantastic article, love your work! Such a great point that Mother Nature provides validation of the vision approach. Can you share some napkin math on why you think Tesla shares are a good investment at current prices?