What If Google Had a Hedge Fund?

Harvard Business Review

Acutely aware of the competitive edges timely data offers sophisticated investors, the company's ever-entrepreneurial cofounder once proposed that Google launch a hedge fund. Google may not have a hedge fund, but it's unlikely that high IQ hedge funds aren't using Google's data to better manage their own situational awareness and risk. What kind of hedge funds might an Amazon set up (remember, Jeff Bezos actually came from a New York hedge fund)?

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The Future of Cities Depends on Innovative Financing

Harvard Business Review

Investors from hedge funds to insurance companies are operating in an environment of low yields, near-zero interest rates, and a glut of savings. Innovation in Cities. Social impact bonds could be one of the most innovative and effective.

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How Blockchain Is Changing Finance

Harvard Business Review

But the solution to this innovation logjam has emerged: blockchain. Menlo Park venture capital firm Andreessen Horowitz joined USV in investing in Polychain Capital , a hedge fund that only buys tokens. The unstoppable force of blockchain technology is barreling down on the infrastructure of modern finance. Our global financial system moves trillions of dollars a day and serves billions of people.

What Markets Do and Don’t Get About Innovation

Harvard Business Review

In 2007, Clayton Christensen co-founded Rose Park Advisors, a hedge fund devoted to investing in disruptive companies. The idea was to transform his theory of disruptive innovation into an investment thesis. Disruptive innovation can take several forms, and the market understands some types better than others. Why the market values some kinds of innovation better than others. This is when disruption theory can inform investors on the value of innovative companies.

Great Leaders Make Decisions | N2Growth Blog

N2Growth Blog

Walt Disney, one of the greatest creative talents and true innovators of our time realized the value of action when he said: “The way to get started is to quit talking and begin doing.&#

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Is Economics Ready for a New Model?

Harvard Business Review

The conviction spread that, thanks in part to financial innovation, the world's developed economies had become more resilient even as financial markets became more volatile. Doyne Farmer , a Los-Alamos-National-Laboratory-scientist-turned-hedge-fund-manager-turned-Santa-Fe-Institute-professor, has bent over backwards not to be ignorant and arrogant about economics. Disruptive innovation Economy Finance

How Banks Can Compete Against an Army of Fintech Startups

Harvard Business Review

By comparison, online lenders face capital costs that can be higher than 10%, sourced from potentially fickle institutional investors like hedge funds. Moreover, in instances where borrowers want to shop and compare myriad options in one place, they turn to online credit brokers like Fundera or Intuit’s QuickBooks Financing for a one-stop shopping experience. Financial markets Finance & Accounting Strategy Financial Services Digital Article

If Crowdfunding is the New Day Trading, Look Out

Harvard Business Review

Paul Volcker famously said the only financial innovation to improve society in recent memory was the ATM. In an essay earlier this week on the evolution of money and finance, GigaOM founder and venture capitalist Om Malik argued that crowdfunding will be the new day trading, the latest financial innovation to “cut costs and [drive] wider participation in a previously closed and clubby market.” Entrepreneurship Finance Technology

Why Consensus Kills Team Building | N2Growth Blog

N2Growth Blog

Great leaders intrinsically understand that team building catalyzes collaboration, creates both disruptive and incremental innovation, facilitates a certainty of execution, and is one of the key foundational elements associated with creating a dynamic corporate culture.

Why Bankers Need to Be Put Into Little Boxes

Harvard Business Review

There's a beguiling little moment in the financial-crisis documentary Inside Job where hedge fund billionaire George Soros describes the principles of oil tanker design. To mainstream economists the Glass-Steagall Act that separated the banking and securities industries looked like a competition-restricting, innovation-damping anachronism. And in an era when innovation is (rightly) celebrated , it is a sector where traditions — and compartments — serve a clear purpose.

Should Tim Cook Care About a 10% Stock Drop?

Harvard Business Review

” In this case, it’s also the scene of a fierce and long-running battle between Apple loyalists and skeptics , joined over the past couple of years by a few activist hedge fund managers badgering the company to give them more money. Apple Disruptive innovation Finance On Monday evening, Apple reported earnings and revenue that were above expectations.

How the Carl Icahns of the World Benefit Firms but Not Workers

Harvard Business Review

There are two stories you can tell about finance in America. ” Both stories contain some truth, as a forthcoming study of activist hedge funds demonstrates. The early activists were pension funds, but starting in the 1990’s some hedge funds adopted the strategy.

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Why Those Guys Won the Economics Nobels

Harvard Business Review

He got his PhD at Yale under Shiller’s supervision in 1984, but since then he has also done a lot of work expanding on Fama’s ideas about risk and return, some of it co-authored with Fama’s son-in-law and University of Chicago finance colleague, John Cochrane. But it is a very basic rewrite of how to think about finance, and it has swept all before it in the academic world. And Lars has taken some of these ideas and applied them in finance.

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The Disruption of Venture Capital

Harvard Business Review

An organization's capabilities become its disabilities when disruption is afoot." – Clayton Christensen, The Innovator's Solution. Over the years, venture capitalists have been some of the most ardent students of disruptive innovation. Hedge fund investors who deploy capital in large and liquid markets can scale their time well. Bill Ackman's hedge fund Pershing Square, for example, has $9 billion in assets under management and fewer than ten investment professionals.

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Uber Is Finally Realizing HR Isn’t Just for Recruiting

Harvard Business Review

As Pete Ramstad and I note in Beyond HR , leaders often have far better developed frameworks for the value proposition of the finance function than for HR. Uber apparently lacked oversight about sexual harassment behavior; it seems far less likely that such oversight would be lacking when it comes to finance. That is like setting up a finance organization to do exotic risk hedging before putting in place basic reporting and compliance.

Startups Could Fundamentally Change the Way Big Investors Operate

Harvard Business Review

Innovation has the potential to transform the investment industry. Small startup firms are already developing proprietary technologies — such as machine vision, deep learning, and other innovations —– that could help large investors evaluate opportunities and risks with far greater accuracy and efficiency than was previously possible. Yet the world’s largest funds are closed off from these innovations.

End the Religion of ROE

Harvard Business Review

DuPont sent Donaldson Brown, a promising engineer-turned-finance staffer, to Detroit to sort things out, and sort them out he did. He reasoned that if marketers worked on maximizing return on sales, production managers were rewarded for the sales they squeezed out of their physical plant, and finance managers focused on minimizing the amount of equity capital they needed, ROE would take care of itself. The number of people affected by an innovation.

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3 Things Driving Entrepreneurial Growth in Africa

Harvard Business Review

Fatigue may be setting in for some Western investors’ interest in African innovation, particularly those that have yet to reap rewards to brag about. Here are three things that Western investors should want from African entrepreneurs: a focus on the top of the pyramid, control over factors of production, and innovation in distribution rather than in products. Innovation in Distribution.

What Initial Coin Offerings Are, and Why VC Firms Care

Harvard Business Review

ICOs are the Wild West of financing — they sit in a grey zone where the U.S. ” Many of them are in China, but there are also hedge funds and bitcoin investment funds who hold massive amounts of bitcoin. Some of the enormous profits they have made in bitcoin are being channeled back into innovation, as many of them seek to diversify holdings, as well as support the ecosystem in general.

How the Next Generation Is Approaching Society’s Biggest Problems

Harvard Business Review

Finally, innovation in the financial markets are funding novel approaches to address these problems. Soon after, when Khan began tutoring his niece in mathematics while working at a hedge fund, he hit upon the idea of developing short video tutorials on YouTube. How did Sal Khan finance his venture? First, Sal Khan could have continued in finance and made far more money than he does in a nonprofit.

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Calculating the Market Value of Leadership

Harvard Business Review

In recent years, investors have learned that defining the market value of a firm cannot just be based on finances. To gain more insights into a specific firm, investors have shown more interest in intangibles like strategy, brand, innovation, systems integration, collaboration, and so on.

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The Danger of Turning Cynical About Silicon Valley

Harvard Business Review

Tech-world denizen Jesper Andersen tweeted a similar sentiment: “Change ‘startup’ to ‘hedge fund,’ ‘ecstasy’ to ‘cocaine’, and ‘douche-bag’ to ‘douche bag’ and you too can see SF is just another Wall St.” By this logic, there’s no reason to applaud the growing number of graduates from top universities opting for jobs in startups and tech rather than finance. Tech startups play a critical role both in driving technological innovation forward and in bringing it to market.

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Greece’s Problem Is More Complicated than Austerity

Harvard Business Review

Although former finance minister Yanis Varoufakis made eloquent appeals about the need to rethink macro, he said very little about changing how the economy is run. contraction today, there was no one in the finance ministry actually making policy.

4 Models for Using AI to Make Decisions

Harvard Business Review

The bad news: Petabytes of new data and algorithmic innovation assure that “autonomy creep” will relentlessly challenge human oversight from within. Process and decision owners determine the resource allocations and whether autonomy should lead to greater innovation, optimization, or both. These organizations are fully committed to letting algorithmic autonomy take the enterprise to new frontiers of innovation, profitability, and risk.

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Should Dual-Class Shares Be Banned?

Harvard Business Review

Firms with growth opportunities as well as the need for external equity financing often convert to dual-class shares. For example, Pepsi’s transformation from a purveyor of sugary drinks toward healthy snacks would have been hindered had hedge funds succeeded in their demands.

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What Good Is Impact Investing?

Harvard Business Review

Or you could participate in projects financed in part by conventional investors and in part by non-profits. Even in the most hard-nosed of private equity firms or hedge funds you will find that people align with strategies that mean something to them, that they’re passionate about. And the beauty of innovative sectors such as impact investing is that we can experiment, collaborate and try to — even in a very small way — reconcile some of what didn’t work previously.

Research: Index Funds Are Fueling Out-of-Whack CEO Pay Packages

Harvard Business Review

On average, common ownership concentration has almost doubled in the last 20 years in the construction, manufacturing, finance, and services sectors. They may choose it for other reasons, for example, to encourage cooperation or innovation. There’s evidence of this dynamic in the tension between smaller undiversified investors (such as hedge funds) and large asset management companies. CEOs get paid handsomely.