The Diff

The Diff is a daily newsletter that focuses on key moments in finance and technology. My goal is to tackle an interesting question: in a few hundred years, when historians look back at our time, what conclusions will they draw about what was happening today?

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Longreads + Open Thread

4 days ago | thediff.co | Byrne Hobart

LongreadsAbraham Thomas of Pivotal with another great look at data companies, this time focused on defensibility. A big focus of this piece is on how LLMs change the economics of data businesses, but as with other technological changes, the new thing is a great way to understand the status quo—crypto can teach you a lot about payments, banking, and currency, and in a sense we didn't really understand the PC and Internet revolutions until we speedran both a second time in the form of smartphones.
Why do Venture Funds Target a Particular Ownership Level?

6 days ago | thediff.co | Byrne Hobart

Why do Venture Funds Target a Particular Ownership Level? Plus! The Path of Deployment; The Long Tail; Non-News; Data; ModelsThis post is for paying subscribers only Subscribe now Already have an account? Sign inJoin 50,000+ industry professionals and curious generalists by subscribing to The Diff.
Peak Berkshire (In a Good Way)

1 week ago | thediff.co | Byrne Hobart

Plus! Diff Jobs; Decoupling; Who Trains the Model-Trainers; Cash Cycles; AI and ARR; GatingThis post is for paying subscribers only Subscribe now Already have an account? Sign inJoin 50,000+ industry professionals and curious generalists by subscribing to The Diff.
Pathologically High-Margin Businesses

2 weeks ago | thediff.co | Byrne Hobart

This post is for paying subscribers onlyAlready have an account? Sign in
Longreads + Open Thread

3 weeks ago | thediff.co | Byrne Hobart

LongreadsIn Palladium, Omar Shams writes that AI will have an unsustainable warming impact on earth, not strictly because of the emissions generated from powering it, but because of the heat generated by computation itself, which has a theoretical minimum we can't beat. But the piece isn't hand-wringing about the need to slow down growth.
There's More Than One Efficient Market Paradox

1 month ago | thediff.co | Byrne Hobart

In this issue:There's More Than One Efficient Market Paradox—Most apparent market inefficiencies have an explanation about market efficiency somewhere else, whether it's transaction costs, borrow costs, or even the cost of sourcing information. Which means that the more you believe the market is efficient, the harder it is to measure exactly what you mean by that. Reciprocal Tariffs—Part of fighting a trade war is admitting that you were already doing it.
Longreads + Open Thread

2 months ago | thediff.co | Byrne Hobart

LongreadsDoidge, Karolyi, Shen, Stulz: why does the US have so few publicly-listed firms? In the late 90s, the US was widely seen as a nation of investors, with widespread equity ownership, pop culture references to the market, multiple news channels entirely devoted to stocks, etc. But now, relative to the size of its economy, the US has relatively few public companies.
AI's Impact on the Written Word is Vastly Overstated

2 months ago | thediff.co | Byrne Hobart

In this issue:AI's Impact on the Written Word is Vastly Overstated—LLMs are not the first time that the cost of producing text at a given quality level has dropped precipitously. Since we already live in a world where there's an effectively infinite amount of verbiage on any given topic, it won't be too big an adjustment to keep moving in that direction. In fact, it's a smaller media shift than the introduction of blogging and spellcheck.
Don't Try to Build Another Berkshire

2 months ago | thediff.co | Byrne Hobart

Don't Try to Build Another Berkshire Plus! Humans in the Loop; Humans in the Loop, Con't.; The Hardware/Software Burden; Custody; Unwinding a BubbleThis post is for paying subscribers only Subscribe now Already have an account? Sign inJoin 50,000+ industry professionals and curious generalists by subscribing to The Diff.
The New National Champions

Jan 27, 2025 | thediff.co | Byrne Hobart

In this issue:The New National Champions—The US has many big companies, but its biggest companies are smaller relative to GDP. Some of that is because the US has such a large economy and so many big companies are global, but there are also policy differences at work. And the policies in question are changing. Open Source AI—DeepSeek has shifted a lot of market value today, but its economic impact is different. Meme Private Credit—Does the Elon Premium apply to debt as well as equity?