Big Bets Volume 1 -- April 21, 2018

The big bet:

Incumbent Airlines will be acquired by Big Banks during the next financial crisis….

Here are my predictions:




(they’ve actually already laid the consumer-facing groundwork + branding for this!)

United + Chase

Delta + American Express

American Airlines + Citi

(*Note - not talking about ‘disruptor’ airlines like jetBlue, Southwest, Virgin, etc. That’s another Big Bet, for another time)

During the next recession, the service industry will get crushed like it always does. In a race to protect margin and keep discretionary spending fueling their credit card business, banks will take extreme measures. Airlines, already operating at close margins, are increasingly incurring unforecastable expenses, (things like TSA delays, costs associated w/ rescheduling customers, vacillating price of oil, regulatory changes, union demands) will be challenged like they always are.

But this time, the government won’t save the airlines like they did after 9/11. Here’s why:

  • competition - upstarts like Southwest, jetBlue, and Virgin keep nipping at the profit margins of the incumbent airlines. The upstarts won’t need a bailout because they run a different and leaner ship.

  • It’s a dog eat dog world out here -- we are operating in a MAGA society where it’s hard to imagine that the Federal Government would bail out commercial airline companies. Welcome to capitalism in 2018, friends.

Enter big banks who have deep financial relationships with aforementioned airlines….they are already trading money for miles! Ponder that for one moment -- by issuing credit cards with mileage points associated with the amount of money a consumer spends on the card, the banks get a pretty healthy insider focus group with which to understand the airline industry….and their acquiree’s business.


Keep your friends close and your potential acquisitions closer, is, I guess, how the old saying goes.

dynamically stable systems -- my tribute to Jane Jacobs


I've always been inspired by Jane Jacobs' observation of cities and economies. Her thesis in her work, The Nature of Economies was around dynamically stable systems and how they avoid collapse.  

Efficient ecosystems do four things, she said:

  • bifurcate
  • create positive feedback-loops
  • ensure negative controls
  • adapt to emergency

It occurred to me after hanging with my friend (and Summit roommate!) Leyla Acoroglu:

^^ my awesome Summit roomie


...that we all live in many independent and efficient ecosystems everyday.  Our world, of course, the largest and most common denominator ecosystem that we all share.

The environment, atmospheric conditions, our garbage production and carbon emissions we know and collectively acknowledge affect us now and will affect us in the future.


We're each individually members of concentric circles - institutions of learning, groups of friends, people bound by shared interest or property.  They are, though, not as independent as we may think they are.  They need common denominators to function, people to bind them.

They are, in fact, more like interconnected concentric circles with multiple points of crossover and connection.


Bifurcation happens when we begin to identify in different circles or groups...technologist, teacher, athlete, mom...our individual identities (chosen and unchosen) begin to allow us to see similarity and difference in each other. My friends who are having babies are joining a new group 'mother' - which will now be an identity they share with mothers all over the world.

When we receive positive feedback that these groups are working (mommy groups, lobbying groups, athletic endeavors like a marathon), we double-down. Technology is like this too: we find a market-segment need and solve for it.

With regard to technology, Uber is a perfect example of these first two steps in Jane's theory.  Bifurcation occurred when Uber's co-founders observed a need in the market: a cab to their location in Paris. The trial runs for Uber perfectly mimicked the market conditions we'd hope for: since Uber's founders basically disregarded the established Taxi and Limousine Commissions that govern local taxis, they were able to receive positive feedback fairly quickly validating this was a worthy idea. The positive feedback loop was validation enough to continue to grow this emerging company...Thusly, ensuring negative controls were in place. By the time the government and regulating bodies came to call, Uber was a profitable company - able to hire the talent they need to keep Uber in major cities.  Therefore, adapting to emergency has become second nature to this company that seemingly can know no bounds...

Back to mommy friends, the groups we create for ourselves in small and large help us to create dynamically stable systems...and ones that we feel safe in.  

inspired thinking

some of my favorite guys are on this interview saying some REAL truths


my friend and former colleague, Brad Stone's book about Amazon but really about business and people.

here it is in the iTunes store!

Screen Shot 2014-10-14 at 10.29.00 PM
Screen Shot 2014-10-14 at 10.29.00 PM

what i'm reading now -- Feb 2015

hello from 2015!  here's the latest from Gretchen's library!

BOOK: Neuro-Linguistic Programming
NLP - A Changing Perspective by Rachel Hott & Steven Leeds

"Neuro-linguistic programming is a model of communication and change. NLP is a model about influencing our own thoughts, feelings and behaviors. NLP is a model about influencing other people's thoughts, feelings and behaviors.  NLP is a model of models. It is a modeling process...Using NLP we can learn 'how' to listen to verbal and non-verbal language patterns so we can recognize how other people understand the world and how it is uniquely different from our own.  In this way, we can truly understand others and in understanding them, we begin to understand ourselves. With this awareness, we can influence and transform the way we think and how others think," - Chapter 1

Download the book on iTunes or Amazon and change your experience of life.

WATCH: Re/Code and the POTUS interview

Kara Swisher interviews the POTUS.  Be still my heart. Re/code is doing it.  Loved President Obama's answers to these very tough questions.  Issue of encryption is, I think, is becoming increasingly more important than ever and one that the US government needs to lead. After all, we created this technology-based economy and we'll also be the ones up in arms if our safety is compromised from something we could've prevented.  Remember how mad we got about Uber's godview?...yeah, and that was just for rides to a party.

READ: The Changing Face of Payments

Guest editor Bill Gates on The Verge talking proliferation of mobile banking as it relates to the unprecedented rise of mobile devices in third world countries.  Change comes quickly when net 2 billion devices join the internet and small transactions that were previously inefficient with high barriers to entry become possible.

Read the article & see the future in the world of:

  • Facebook Payments
  • Google Pay
  • Amazon Payments
  • Paypal
  • PayNearMe
  • Square
  • The list goes on and on...

The future is limitless. Sign. Me. Up.

BOOK: Give and Take by Adam Grant

 This seems to be the motto of every great leader I know. I do love my Management & Leadership books...see previous blog posts.

Adam Grant's Give and Take

Here's the simple premise: workers can be broken down into takers and givers. Takers only agree to do things that will benefit them eventually.  Givers work collaboratively without a lens towards 'what will it get me?' Grant concedes: takers aren't always super successful at work but:

"Something distinctive happens when givers succeed: it spreads and cascades. When takers win, there's usually someone else who loses... Givers succeed in a way that creates a ripple effect, enhancing the success of people around them...the difference lies in how giver success creates value, instead of just claiming it." = pg. 25

ARTICLE: Women At Work

Sheryl Sandburg and Adam Grant have been writing this five-part series about women at work.

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Screen Shot 2015-02-15 at 5.29.19 PM

This one in particular struck a chord with me. The latest in the series, it is bizarre to me that we all-too-often automatically delegate household-type chores to women in the workplace before we think to assign this type of work equally amongst the team or delegate to a more junior employee.

I've seen it happen in companies I've worked for, though, and I admit that -  more often than not -  women are simply better at the admin and logistics work.  (Placing office food & coffee orders, greeting visitors at a collective door, assigning badges and administrative work, etc.)

I'm not sure where I net out on 'Office Housework' -- it's a little like the nature vs. nurture argument:  if you spent your entire professional life organizing, ordering and supporting an organization, then you will, of course, end up in a more high-touch, less analytical, more people-focused type job -- IF that's what you were aiming for.

If, on the other hand, you'd prefer not to end up in a people-first type of job, perhaps it's more logical to start or pivot one's career towards analytics, engineering, programming, IT or finance.

Just a thought. What do I know?

 ARTICLE: Home Team Love

You gotta love how my dear friend and constant source of light, Kathryn Budig, opens up in this post on Yoga Journal. Life is full of injury -- all the time -- it doesn't need to be a shoulder injury & yoga teacher scenario. Sometimes it's illness, sickness, disease...we trick ourselves into thinking that life's answer is to 'power through it.'

It's not.

It's taking a month, three months, a day, a year -- whatever you need to to get back to a state of ease. Where you can perform as close to 100% capacity as your body will allow.

Trust me when I tell you: your students will appreciate you taking time to heal, your co-workers or future co-workers, your partner and family. You will be much better at whatever you do if you're really honest about the body's need to heal.

Oh, and meditate. Do that too!

AUDIBLE.COM - LISTEN: The Age of Turbulence by Alan Greenspan

(first, the preamble):  It's no secret if you've ever worked with me that I learn in a very specific (and some might say, unique, way).  I'll save the back story for another time but short version: growing up, our family did not have cable TV and for many years, didn't have a TV at all. This led to the Sword children learning quite differently than other children. For me in particular, I've noticed that friends of the same generation are able to watch something on TV and learn about the subject matter at hand.  I tend to watch things and fall asleep...I do not learn by watching anything, really.


In order for me to truly learn a subject matter, I need to hear it, experience it and see it. (In that order). (And ultimately, teach it).  I actually suspect that things like the Serial podcast (which gained such enormous traction last Fall) are this generations' response to how we learn -- it's quite different from how it used to happen.  Anyway, that's for a different blog post.

Enter Audible.com -- an internet 1.0 company that survived the fall-out and one that I have huge respect for.  Don Katz (Audible CEO) & Guy Story (Audible Chief Innovation Officer) are some of the most interesting & innovative people I've met on this side of the Mississippi -- and they've pioneered a technology that, while simple, is a life-changer for people like me.

My Audible.com playlist is filled with non-fiction, education-based books. Although I must admit I own this particular book in hardcover, on iTunes AND on Audible....when I want to check back on historical data to help inform future predictions OR I simply want to remember a time in our country's recent financial history, I put this book on my Sonos sound system and get to listening.

This is a wonderful book because Alan Greenspan has a brilliant way of bringing the reader right back to the time and place where policy was affecting market conditions. Where his decisions as Fed Chairman seemed to change the axis on which our earth was spinning. Where the markets began to reinvent themselves to create the environment we see today.

Because he was Fed Chairman for SO long (1987 - 2006) and served as an adviser and friend to many of the President's of the United States over the course of his professional career, he has a unique and welcome disposition in the changing tides we live through: one that I hold in high esteem when I look at our collective future.

Finally, can't leave this bit out -- I've been a student of the Federal Reserve since 2003 when my mentor and teacher, Professor Pat McGuire, told me if I understood macroeconomic conditions, I could understand how economies everywhere work.  Thusly, I've owned this book since it was published (an untimely publishing -- in the middle of the recession)...and studied it like a textbook since that time.  Last summer (2014) I got to spend the weekend with the co-author of the book, Peter Petre. Life has a beautiful way of coming full-circle just when you least expect it...stay open, stay curious, kiddos, you never know where it might lead you.

With that, I bid you adieu until next time -- would love to know what YOU are reading/watching/consuming! Write it below or drop me a line.

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P.S. Thanks @Nathan Ingram for the assist with the WP images on da blog.


serendipity...is knowing a good idea when you see one and then realizing gratitude when you're sitting at the table with the founders. 

or put a different way..."luck is preparation meeting opportunity." - the wise one, Oprah.