Where’s the line?


October 7, 2019

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Today, records and film are thriving from digital and disaster-proofing your home may become pivotal, but first…

The Hustle Daily Email

The computer overlords have come to finance

Holy HAL. As artificial intelligence gets more, well, intelligent, it’s playing a bigger role in the finance world — and it’s starting to write its own rules.

Although there are certain efficiencies inherent in letting a machine run the numbers, some worry that AI anarchy could lead to economic catastrophe.

It’s getting quieter on the trading floor

You’ll still see stressed-out guys in suits yelling about buying and selling, but more of that work is getting done on servers. Computer-run funds make up 35% of the US stock market, 60% of institutional equity stocks and 60% of trading activity.

Sophisticated programs can do more than just manage portfolios 

They’re now starting to monitor the economy and move capital.

While most of these AI programs are designed to follow rules established by their human controllers, newer programs are starting to write their own strategies… often in ways humans can’t quite follow.

‘I’m sorry, Dave. I’m afraid I can’t do that.’

Data is a big driver in determining how to move money, but some economic phenomena — like the trade war or falling interest rates — require a human touch to navigate.

Meanwhile, some hedge fund managers have raised concerns that AI might not operate under the same strict insider-trading and disclosure laws they do — you can’t program scruples. 

Other investigators have complained that the way AI chases and abandons securities can distort asset prices, and that some algorithms have already led to “flash crashes.” And because it’s fund managers who vote board members in and out of office, AI could even start playing a role in corporate governance.

» Talk about computer overlords.
 

Hustle Con 2019 Day 2 sessions announced…

It’s finally here… details on Hustle Con’s Day 2 breakout sessions. For those of you just tuning in: Hustle Con is now a 2-day event. Day 2 will consist of smaller hyper-specific breakout sessions taught by seasoned startup leaders — AKA it’s the startup classroom attendees have been asking for. Click below to see the first batch of finalized sessions.

Consider yourself FOMO’d →

Take me to bunky town: Rich homeowners are investing in custom home-protection features

For years, survivalists have been singing “It’s the end of the world as we know it” — and the richest among them have even purchased protected bunkers in Kansas or getaway properties in New Zealand. As one does. 

But it’s the age of delivery babyy, so now they’re just bringing the safety right to their steel-reinforced doors.

Storms are a-brewin’, but building regs are slow to get with the times

Many home insurance policies and building codes are based off the 100-year-storm stat, but some experts feel that the changing climate necessitates revisiting this often-misinterpreted probability rule.

Meanwhile, homeowners in disaster-prone areas are looking to protect their houses from rains of terror… and from flash floods, fires, mudslides, and tornadoes.  

In response to this emerging demand, specialty architecture firms are starting to offer neat safe-space additions like steel window shutters, flood vents, and tornado rooms.

Still, you might want to hold off before opening your own steel-shutter business

The luxe-home category has been a bit shaky since the 2017 tax changes, and the market for these top-dollar custom doomsday dwellings still remains quite niche.

» In this climate?

Research shows new tech can help bring old tech back from the dead

Vinyl and film are making comebacks. Revenue from vinyl has been trending up for 15 years, and it’s on its way to becoming the largest source of revenue from physical sales in the US music industry. Previously discontinued film types are also being resurrected. 

Why is old tech coming back from the dead? Researchers say third-generation tech, like digital music and phone cameras, can help rejuvenate first-gen tech, like vinyl and film photography, if the newest products lack something valuable the originals offer.

In this case, it’s tangibility

80% of American music industry retail revenues come from streaming — the way most 21st-century people listen to music — but rising record sales suggest people still value owning physical albums. 

Same with photography. While high-quality phone cameras are ubiquitous, people still want physical photos and are drawn to the film aesthetic.  

In response, Fujifilm started selling black and white film again, Kodak re-released its vibrant Ektachrome film, and there are tons of instant film cameras on the market.

This news is good for vinyl but bad for CDs

The fact that CD sales are stagnant and digital camera shipments are declining illustrates another principle researchers found: although third-gen tech can be a boon to first-gen tech, it often cannibalizes second-gen tech — in this case, CDs and digital cameras.

» Phonographs and film

Small business of the week: A husband and wife disrupt the outdated jewelry industry

Every Monday, we feature a company started by one of our readers. Want your story featured? Fill out our Small Business Survey. Want to see the anonymized financials of all 500+ companies? Subscribe to Trends.

In the summer of 2017, Chris and Steph Sammons were set to get married. As Chris looked for his wedding band in dozens of stores across Philly and New York, he kept finding the same thing: small selection, ill-informed staff, lofty prices, and months of turnaround.  After waiting two months for his ring of choice, he was told they forgot to order it. Multiple purchases on Amazon later, the couple decided to create a better way.

Enter Hitched.

Hitched allows buyers to select 5 rings and ships them directly to consumers in one week. All of their rings cost less than $499 — a third to a fifth of the in-store price point. 

They’ve achieved lower cost, speed, and variety by working directly with manufacturers, eliminating the middle-men suppliers involved with many diamond retailers.

Sales reached $250k in their first year in business, driven mostly by referrals. “We knew that if we could make the process fun, easy, and affordable, people would tell their friends,” Chris said. “Everybody knows somebody that’s getting married and they all talk to each other.”

They’ve recently partnered with the Groomsman Suit and have plans to open 2 in-person showrooms so people can have a drink, kick back, and leave with a band. Imagine Bonobos, but for the outdated jewelry industry.

Stats at a glance:

  • Founders: Chris and Steph Sammons
  • Employees: 3
  • Years in business: 1
  • Cost to launch: $125k
  • Funding methods: Angel funding
  • Current annual revenue: $250k
  • 2020 projection: $1m+

Advice to first-time founders? 

Chris: “A lot of people like to dip their toes in, but you really need to take the dive.” Steph: “Don’t be scared of competition. Competition is out there, is healthy — and honestly, it makes you hungry.”

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Imagine managing leads and deals from the same place you read and write emails. Or seeing all your business info in one place. Or simply being as organized as a multinational corporation. What a novel idea. 

It’s the kind of CRM that helps small businesses become big ones. And big businesses equal big bucks. We like the sound of that. 

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What Else…

👟 Tennis shoes are kickin’ up. “Sport leisure” sneaks are set to become the largest footwear category in the US in 2020 — outselling “fashion” footwear for the first time ever. 

🥦 Some markets aren’t flying as high. While pot stocks were hot headed into 2019, the market has wildly underperformed. And Wall Street’s tapping into its “bearish” instinct.   

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