Machine Learning and Neural Networks

If you ever wanted a good example of what machine learning is and how neural networks work, just check out this video.

Now imagine this same technique applied to a massive data set, processed with computing power by, for example, Google’s off-the-shelf Machine Learning Platform. ┬áLeveraging these tools with unique data sets and specialized know-how will be the vector of differentiation for software companies over the medium term.

Risk (Loss Ratio) Management is Key to Long Term Success in Investing

There are no brave old people in finance. Because if you’re brave, you mostly get destroyed in your 30s and 40s. If you make it to your 50s and 60s and you’re still prospering, you have a very good sense of how to avoid problems and when to be conservative or aggressive with your investments.

This is such a good quote from Steve Schwarzman via Dan Primack.

Having just come through a massive risk-on investing period in Silicon Valley, an era where seemingly nothing but reward has been discussed (irrespective of investment entry point in a company’s life cycle) it is a nice reminder that reward AND risk management matters. Some risky bets might not fall you today, especially in private equity where feedback loops are long, but I can tell you from observing investment firms come, go, and stick around, over time, risk is a killer to a fund manager’s career and investors’ capital. (more…)