A Quote by Charlie Munger
Clever derivatives broke dozens of companies. It killed them. Bankrupt. We don't need these kinds of innovation in finance. It's OK to be boring in finance. What we want is innovation in widgets.
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There's so much innovation going on, and there are lots of people funding that innovation, but there's very little innovation on that infrastructure for innovation itself, so we like to do that ourselves to help companies create more tech companies.
The Internet of Money, bitcoin, is releasing 50 yrs. of pent up innovation in finance, because it offers innovation without permission.
We take smaller companies and middle-sized companies, all around the world, and we do currency exchange for them; we raise bonds and equities for them; and we do inventory finance, trade finance, and custody of assets.
Rapid innovation is the cure for the ills we face, but because innovation is difficult and susceptible to failure, we might need to rethink the way we approach innovation and how we drive it through our companies.
Most companies don't have the luxury of focusing exclusively on innovation. They have to innovate while stamping out zillions of widgets or processing billions of transactions.
I think innovation as a discipline needs to go back and get rethought and revived. There are so many models to talk about innovation, there are so many typologies of innovation, and you have to find a good innovation metric that truly captures the innovation performance of a company.
At 25, I made many companies. I was thinking more like a businessman or entrepreneur than a CEO. I created many companies, small companies, medium companies. I tried to be involved in many kinds of activities, in finance, in real estate, in mining.
I think there are too many smart people pursuing internet stuff, finance, and law. That is part of the reason why we haven't seen as much innovation.
Companies have too many experts who block innovation. True innovation really comes from perpendicular thinking.
One of the banes of successful innovation is that companies may be so committed to innovation that they will give the innovators a lot of money to spend.
If you look on Amazon - if you do a search for personal finance, there are literally 20,000 books written on personal finance, and there's no real reason for it. I mean, personal finance is pretty simple.
It's the unlikely juxtaposition of creativity and logic which causes the wooliness and confusion around the term 'innovation'. Everybody wants to be innovative; many companies and ideas are proclaimed to be innovative and no one doubts that innovation is a money spinner. And, thus, we are all looking for the magic formula. Well, here you go: Creativity + Iterative Development = Innovation.
Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or a different service. It is capable of being presented as a discipline, capable of being learned, capable of being practiced. Entrepreneurs need to search purposefully for the sources of innovation, the changes and their symptoms that indicate opportunities for successful innovation. And they need to know and to apply the principles of successful innovation.
It is easier to disrupt consumer finance. It is much harder to disrupt institutional finance, Wall Street. It is very heavily regulated, and because it is institutional finance, you are dealing with incumbents.
There is this group of people who love innovation. Those people want to innovate, and they think the Internet is a wonderful tool for innovation, which is true. But you also have to remember that much of that innovation is constrained within the realities of the foreign policy.
In the West, if a city faces financial difficulties, it'll go bankrupt. But in China, cities will be subsidised by the Ministry of Finance. So some small- and medium-sized cities aren't worried about going bankrupt. They figure the central government will help them out.
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