The difference between a business that compounds and one that doesn't is often not the talent of the founder, but the defensibility of the moat—and most founders underestimate how much time it takes to build one.
Parks & Cruises is putting up these numbers while being only a ~1/3 of Disney's $94B revenue. The division is floating Disney's entire transition from dying cable TV assets to streaming….which has been a bumpy ride.
There are a million little details that made Bezos' plan work, all of which, and the connections between them, were taken into consideration. Get to scale category-by-category, starting with the ones best suited to the internet, build an unmatched distribution and logistics network, drive down prices and delivery times, get more scale, grow the distribution network, drive down prices, make the "divinely discontent" customers discontent with anything slower or more expensive than what they'd come to expect with Amazon, get them hooked on Prime, paying a subscription and ordering more, keep pressing the advantage, grow FCF per share.
For decades after the fact, conventional wisdom was that Microsoft's modular approach — the one that let me build my own computers — was unquestionably superior to Apple's integration of hardware and software. In fact, it was Apple's integration that kept the company afloat.
If you wanted more evidence that AI is changing everything, look no further than Arm: the company was famous for its high margin IP-licensing business model, but this week announced that instead of (just) facilitating other company's making chips, it would start making and selling chips itself.
The idea that it's hard to wring out the last inch of performance, but the difference between a mediocre business and a great one is often just that last inch of improvement applied over decades.
The chip design firm says Meta, OpenAI, Cerebras, and Cloudflare are among the first customers of its new artificial intelligence hardware.
There is an argument that without the organizational skills and production strategy Forrest brought to the table, Fender may have not been able to make the jump from a comparatively small builder to the mammoth industry leader it became.
What makes Kuwait's move so striking is that the rest of the Gulf has spent the last five years moving decisively in the opposite direction — and for reasons that have nothing to do with conscience. Qatar, under the sustained commercial pressure of World Cup scrutiny, eliminated exit permit requirements for most workers in 2020. The UAE has significantly loosened job-change restrictions, and Bahrain has done the same. These were pragmatic, strategic pivots by governments that understood something important: if you want to attract the global professional class — the fund managers, the architects, the regional directors choosing between Dubai and Singapore — you cannot run a labor system that treats people as controlled assets.
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