Welcome to Stuff I Thought About Last Week, a collection of topics on tech, innovation, science, the digital economic transition, the finance industry, double slits, and whatever else made me think last week. Please grab me on Twitter with any thoughts or feedback.

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In today’s post: grocery stores' refrigerant problems; job fairs on Discord as wages rise; private mesh networks for surveillance and data transfer are multiplying; the difficult odds facing chip startups; new class of drugs targeting the obesity epidemic; will tech bring back company towns; new methods for astronomical imaging; some NZS news; and lots more below...

Stuff about Innovation and Technology
Grocery Needs Green Makeover
The EPA’s new regulations to significantly cut hydrofluorocarbon use by 85% over the next fifteen years would require grocery stores to overhaul their cooled cases. The problem stems from the vast lengths of leaky piping snaking throughout the stores to deliver coolant to a hodgepodge of locations. In total, 55% of stores tested in Washington D.C. had refrigerant leaks, including 60% of Walmart stores. As grocery potentially undergoes a shift toward click-and-collect and/or delivery, it might be easier to just build new, specially-designed cooled warehouses rather than spend to retrofit stores that increasingly may not have as many people walking the aisles staring through glass doors. For example, Picnic in the Netherlands has robotic warehouses with three different temperature zones.

Salesforce Dreaming of Disney
Salesforce founder Marc Benioff is dreaming about the possibility of a Disney-like corporate campus: “What they’ve done so successfully with their parks is you show up at a Disney park and you smell Disney, you see Disney, you feel Disney, you hear Disney. That’s what I want my new employees to feel for Salesforce.” Which raises the very serious question: what does Salesforce smell like? In the WSJ interview, the CEO indicated that Salesforce is looking for a large ranch in the US to build the next Crotonville (referencing the 1950s General Electric campus in New York). For a quicker, greener, and more flexible fix, Gather.town is a virtual space that allows employees to meet and talk. Unlike Zoom or other video conferences that only allow one speaker at a time, Gather works more like the real world where multiple people can talk at once, and you can even hear conversations at a distance (with volume dictated by your avatar's proximity). You can walk your avatar in and out of conversations as you move around. This type of interactive space will likely become natural once VR is more mainstream. The pandemic has raised the question of whether office jobs can evolve into something better – perhaps involving some new hybrid of work and virtual spaces, which will smell like your home office (unless you want your olfactory-modulating hepatic suit to simulate an office breakroom with the hint of microwaved salmon...and there’s a new nasal wearable device that even allows you to smell in stereo).

DarkSide's Bright Side
DarkSide, the hacking group responsible for taking down the Colonial gas pipeline (now restored) apologized for the mix-up and said it has implemented a moderation mechanism to check each company targeted by their ransomware because they reportedly don’t want to create problems for society. DarkSide also claims to donate part of its loot to charities and maintains a help desk and call-in number for its victims. They are not quite the ethical hackers you might find on a platform like HackerOne, but I guess their attempt at morality is better than nothing. Colonial is reported to have paid $5M to DarkSide, but it took so long to decrypt the stolen data that the company was able to get up and running sooner from their own backups.

Discord Job Fairs
After announcing that starting wages will increase to an average of $15/hr, Chipotle is holding the first job fair in Discord. The burrito giant’s Discord server will “feature recruitment content and live sessions with Chipotle employees highlighting its benefits, career paths, cooking demos, and more. Career fair participants will have the opportunity to chat with real Chipotle employees and gain valuable insight into what it's like to work in a Chipotle restaurant.” Discord also recently announced their new Stage Channels for discovering live events on the platform.

Wireless Webs Powered by Crypto
There is a wave of low-power, proprietary wireless mesh networks popping up. Amazon’s Sidewalk network uses Ring and Alexa devices along with other connected objects, like Tile smart tags, to create an ad-hoc network. Apple uses its devices to create a private mesh network to track its new smart tags and find phones. Basically, our devices are increasingly being connected anonymously (hopefully!) to nearby strangers’ devices to enable wide-area surveillance and data transfer. I don’t believe Google has (yet) done the same with Nest and Android, but it seems only a matter of time. In one of the more extreme, forward thinking examples of an ad-hoc mesh network, Helium is a startup that allows everyone with an Internet connection to create a mini 5G cell tower. The company’s base stations create a peer-to-peer network for tracking connected devices like smart scooters or pet collars. The network uses a free, FCC-sanctioned 5G spectrum band called Citizens Broadband Radio Service (CBRS). There are 30,000 points in place today and another 200,000 on order. Helium leverages blockchain technology and distributes its proprietary cryptocurrency, HNT, to people who have deployed the hardware.

Food Delivery's Prospects Hinge on Dine-In Deficit
A new paper from Daniel McCarthy does a deep dive on food delivery purchase data and concludes:
“Our event study and regression analyses both offer mixed inferences about the health of the restaurant delivery category. The former analysis suggests that pre-COVID sales growth trends were weakening significantly and that COVID accounted for the majority of overall growth in 2020, while the latter analysis implies that the decrease in restaurant dine-in was the primary driver of that growth. To the extent that there is a return to restaurant dine-in as part of the recovery from the pandemic, this suggests negative future prospects for the delivery category.”

Cloudflare Cutting CAPTCHAs and Cookies
According to Cloudflare, humans collectively spend 500 years per day proving we are indeed human to CAPTCHAs. The annoying picture games designed to stop bot activity take, on average, 32 seconds to beat. I’ve always felt I was notoriously bad at CAPTCHAs, but I might actually be closer to average, in which case I can only imagine the outliers spending even longer trying to figure out if the pole holding a stoplight is also considered a stoplight. Cloudflare’s solution relies on trusted USB keys like YubiKey (or the virtual equivalent on your phone), which are a little cumbersome but allow people to quickly prove their humanity without relying on culturally-specific knowledge or giving up any personal information. In other Cloudflare news, they recently deprecated a common browser cookie, utilized by the 82% of websites that use their reverse proxy service, which will save 112TB of data transfers per day.

Putting Silicon Back in Silicon Valley
The NYT discusses how silicon is back in Silicon Valley with $12B invested into 407 chip-related startups in 2020, doubling 2019’s tally. Chip design software maker Synopsys keeps tabs on over 200 AI chip startups. If you look at the broader established landscape for leading-edge digital chips to run all types of workloads, including AI, you have: 1) the standard chips from Intel, Nvidia, AMD, and, increasingly, Arm partners; 2) the custom chips built for specific high volume workloads, like the TPU from Google and other rumored chips at the big cloud platforms; and 3) programmable chips like FPGAs. There is a huge existing software and programming ecosystem around x86 and Nvidia, and engineers are building one around Arm in the data center. Google’s cloud software is tuned for its custom silicon. And, all of these existing standard/custom chip designers are innovating at high speeds. It’s not clear what market is left in the data center unless a startup can catch these moving targets, tape out and secure capacity at TSMC (which has no wafers to spare right now, but always smartly works with startups), build a software ecosystem, attract developers, and get customers, all the while spending hundreds of millions of dollars to work on the next chip, which needs to trounce the current chip in performance just to keep up. It seems like a high-degree-of-difficulty dive into a small pool. The dive is probably easier the more you move down and out of the data center into the edge and the IoT. Kevin Krewell of TIRIAS Research commented that there are “too many [AI] startups today than the industry can support long term. I’m sure a few more will pop up with more exotic solutions involving analog or optical. [But] eventually, AI/ML functions will be subsumed into larger SoCs or into chiplet designs.” Contrast a chip startup with a traditional software startup: while by no means a cakewalk, all you need to do is write the software on an existing public cloud to solve a specific customer pain point, and then create a freemium model for distribution. Therefore, what seems more likely is that innovation continues to take place in the software layer on top of the array of compute platforms that exist today. That said, I hope I’m wrong – it’s been far too long since we’ve seen a flourishing of chip startups.

Miscellaneous Stuff
Semaglutide
Scientists are developing a new class of anti-obesity drugs called incretins, like semaglutide from Novo Nordisk, which is up for FDA approval in June to treat obesity as a chronic disease. The apparently safe drug (which mimics the body’s naturally occurring incretin hormones) acts as an effective appetite suppressant, with the average person in the clinical trials losing 15% of their body mass, and one-third of participants losing 20%. Obesity alone is said to account for around 8% of US healthcare costs, and, overall, lifestyle related diseases are thought to be 26% of US healthcare spend. Obesity played a large factor in negative COVID outcomes: countries where less than half of the population was overweight had about one-tenth the death rate (a stat that's obviously influenced by many other factors but is noteworthy nonetheless). Chipping away at obesity with an effective drug could eliminate a huge amount of healthcare spending here in the US.

Exoplanet Imaging via Quantum Interferential Recorders?
Interferometers are used in astronomy to resolve stellar images/data via combined analysis of multiple recordings from different sources. This method of superimposing waves (which can either reinforce as signal or cancel out as noise) allows a series of small telescopes to act as a single big one (e.g., potentially Earth-sized for a series of land-based scopes), thus giving an unprecedented level of resolution. For example, interferometry was used by LIGO to detect gravitational waves and is frequently used in data analysis for radio telescope arrays (and was the basis for how Jodie Foster’s character in the movie adaptation of Carl Sagan’s Contact receives the alien broadcast). Optical interferometry is significantly more difficult than radio because the much smaller optical wavelengths make the signals harder to align. It’s possible to hardwire fiber optic connections between disparate optical scopes to enable signal alignment, but there’s a practical limit (~1km) to the intervening distance, thus limiting resolution. Alternatively, scientists think they could record the interferential quantum states of incoming photons across the array, which would theoretically allow resolution of actual surface details of a distant planet circling another star in the Milky Way. The trick would leverage the notion that photons are both a wave and a particle. If you pass a single photon through a double slit, it creates a wave interference pattern – provided that you don’t attempt to pin down which slit the photon passed through, which would cause the interference pattern to disappear (the gotcha illustrated by the Schrödinger’s Cat paradox). So, if you store the interference pattern of each arriving photon on a quantum hard drive attached to each scope (so you treat each scope like a “slit” – you aren’t checking which scope actually received the photon, just recording the interference pattern from EACH incoming photon across ALL scopes) and then bring those hard drives together, you could, in a meta-analysis sleight-of-hand, superimpose all the single-photon interference patterns to create an image. Piece of cake! Except that quantum hard drives don’t quite exist outside of basic lab prototypes just yet. The ones we have only work over short periods of time for a limited number of wavelengths, but they are being improved upon. One example uses europium nuclei embedded in a crystal. While its quantum record only lasts for six hours, you could fly hard drives between scopes for analysis. An alternate idea would use a quantum Internet, which relies on the entanglement of photons so they can be teleported over long distances. Regardless of how it’s ultimately accomplished, the idea of turning the entire Earth into a double-slit experiment is very cool.

Stuff about Geopolitics, Economics, and the Finance Industry
A Big Thank You from NZS
There was some press coverage last week of the launch of our growth strategy for clients outside the US through our partner Jupiter Asset Management (you can read about the new fund here or in this interview in Nordic-focused AMWatch). I want to take a moment to extend my sincere thanks to the phenomenal NZS Capital and Jupiter teams, as well as our clients, who now entrust us with management of over $1B in assets. We are grateful to have the good fortune to achieve this milestone as a new investment boutique. As always, we continue to work on your behalf to find the adaptable, non-zero-sum winners in the analog-to-digital economic transition, and we look forward to a long and fruitful partnership.

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The content of this newsletter is my personal opinion as of the date published and is subject to change without notice and may not reflect the opinion of NZS Capital, LLC.  This newsletter is simply an informal gathering of topics I’ve recently read and thought about. It generally covers topics related to the digitization of the global economy, technology and innovation, macro and geopolitics, as well as scientific progress, especially in the fields of cosmology and the brain. I will frequently state things in the newsletter that contradict my own views in order to be provocative. Often I try to make jokes, and they aren’t very funny – sorry. 

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