In This Newsletter, We Will Talk About

Here is what you'll gonna learn in the next 10 minutes or less!

Decoding Wall Street's Most Recommended Books for Value Investing
How KNPP Paper's $800M Empire Crumbled to $0?
How did HP burn $900 Million on Touchpad?
5 Hacks Irvin Gunawan used to turn $0 into $35 Million Sales

Here are this Week's Giveaways!

Decoding Wall Street's Most Recommended Books for Value Investing

How KNPP Paper's $800M Empire Crumbled to $0?

Did you know that KNPP Paper & Pulp first developed the waterproof paper used in the original D-Day invasion maps during World War 2?

Founded in 1907 by Karl Nilsson and Peter Peterson (the "KN" and "PP" in the name), KNPP started as a small Wisconsin mill with a unique approach, a vision to create speciality papers that solved specific industrial problems, not just commodity products.

For decades, KNPP dominated the speciality paper market with its iconic blue packaging, using this business approach. It gained so much credibility in the Industry that Allied commanders trusted the durability of KNPP's patented moisture-resistant treatment over any other brand for their critical paper needs.

Did you know that, by the 1980s, KNPP was generating $1.2 billion in annual revenue with profit margins twice the industry average?

Unique Value Proposition:

Vertical Integration: Owned 215,000 acres of timberland, ensuring supply chain control.
Research Focus: Maintained the industry's largest R&D lab with 120+ scientists.
Process Innovation: Pioneered closed-loop water recycling decades before competitors.
Patent Portfolio: Held over 300 patents for specialised paper treatments and manufacturing processes.
Family Ownership: Remained family-controlled for 87 years, enabling long-term planning.

Did you know that in 1989, a KNPP employee, Sarah Lehrman, proposed expanding into digital document management, but was dismissed as “outside our core." She left, founded DocuSystems, and sold it to Adobe for $440M in 2002

The $235 Million Failure:

In 1995, KNPP made a fateful move that would ultimately accelerate its downfall: investing $235 million in expanding its print publication paper capacity.
The timing couldn't have been worse. Three market forces were converging to undermine KNPP's core business:

Digital Transformation: Newspapers and magazines, major customers, began experiencing circulation declines
Global Competition: Low-cost producers in Asia entered the market with government subsidies
Environmental Pressures: New regulations increased compliance costs while changing consumer preferences

The Gradual Erosion Was Painful to Watch

1998: First quarterly loss in 22 years
2003: Closure of three smaller mills, 1,200 jobs eliminated
2008: Sale of timberlands to raise capital
2015: Chapter 11 bankruptcy protection
2018: Liquidation of all remaining assets
Total loss: Over $800 million in shareholder value erased

"We're betting on the permanence of print. The internet is primarily for entertainment, serious reading, and information will always require paper." — Richard Nilsson, KNPP CEO (1992-2003)

5 Mistakes that caused the $800 Million collapse of KNPP

Underestimating Markets: Focused on five-year forecasts that simply extended past performance while ignoring emerging digital disruption.
Who's Doing It Right? International Paper, diversified into packaging and speciality products early, reducing exposure to declining print markets
Product Innovation: KNPP defined their business as "paper manufacturing" rather than "information storage and communication".
Who's Doing It Right? Fujifilm, transformed from a photography company to a diversified business in healthcare, electronics, and materials, when film declined
Financial Intelligence: KNPP made a single massive bet on print paper expansion rather than staged investments.
Who's Doing It Right? 3M, maintains a portfolio approach to capital allocation, with investments across different time horizons and risk profiles
Brand Positioning: They allowed institutional pride in their heritage to block acknowledgement of market changes.
Who's Doing It Right? Microsoft, under Satya Nadella, explicitly rejected the "Windows-first" mindset to embrace cloud and cross-platform strategies
Losing People Capital: Lost forward-thinking employees who saw the coming disruption but couldn't influence strategy, failing to create pathways for employees to explore adjacent opportunities within the company
Who's Doing It Right? Amazon's "two-pizza teams" and internal incubation processes give innovative employees alternatives to leaving

How did WeWork burn $41 billion on Delusion?

Did you know that WeWork once spent $60 million on a private Gulfstream G650 jet that Adam Neumann used to host marijuana-fueled cross-continental parties?

For a brief, dazzling moment, WeWork convinced the world it was revolutionising real estate with kombucha taps and glass walls.
Then the house of cards collapsed, revealing one of the most spectacular valuation implosions in business history.

Founded in 2010 by Adam Neumann and Miguel McKelvey, WeWork began with a straightforward premise: to transform boring office space into vibrant communities where entrepreneurs could collaborate and grow.
By 2018, WeWork had become the largest private office tenant in Manhattan and London, with over 400,000 members worldwide.

Initial Market Response:

Prime Locations: Secured trophy properties in the world's most expensive cities
Instagram-Ready Aesthetic: Pioneered the now-ubiquitous industrial-chic office design
Community Focus: Created a cult-like atmosphere with free beer, events, and networking
Tech Positioning: Convinced investors it was a technology platform, not a real estate company
Global Ambition: Expanded to 111 cities in 29 countries in less than a decade

"WeWork isn't just a company. It's a movement that's changing how people work, live, and think." — Adam Neumann, at a 2018 company retreat

The $41 billion worth of Delusion:

In January 2019, WeWork reached its apex: a $47 billion valuation following SoftBank's final investment, despite losing $1.9 billion on $1.8 billion in revenue the previous year.

Tech Multiple Mirage: WeWork convinced investors to value it like a software company (20x revenue) rather than a real estate company (3x revenue).
Community Contribution: Marketed the intangible value of "community" to justify premium pricing.
Prophet Positioning: Neumann's charismatic personality created a reality distortion field that obscured fundamental business flaws.

Despite its business failure, WeWork's cultural impact remains significant. The company fundamentally changed expectations for office aesthetics and amenities.

The ubiquitous design elements, exposed brick, glass-walled conference rooms, neon signage, phone booths, and communal spaces, have become standard features in corporate offices worldwide.

Ironically, in the post-pandemic world where hybrid work has become standard, there's arguably more need than ever for flexible workspace solutions. WeWork pioneered the concept but destroyed itself before it could capture this opportunity.

Did you know that Rebekah Neumann insisted on firing employees within minutes of meeting them if she felt their "energy was bad?"

5 Lessons for Startups to Learn from WeWork's $41 Billion Disaster

Business Fundamentals: WeWork allowed Neumann's charismatic storytelling to supersede basic business fundamentals, instead of implementing governance systems that separate visionary leadership from financial oversight.
Who's Doing It Right? Apple pairs creative leadership with operational discipline, creating checks and balances between innovation and execution
Unit Economics: Their Mistake was to be focused on top-line growth while individual locations operated at unsustainable losses.
Who's Doing It Right? Shopify rigorously tracks merchant-level economics to ensure its growth comes from sustainable customer relationships
Governance: WeWork gave Neumann unprecedented control, including 20:1 voting rights and self-dealing opportunities.
Who's Doing It Right? Microsoft's board includes diverse expertise that can meaningfully challenge management decisions
Product Positioning: They constantly shifted their identity from real estate to technology to spirituality based on audience, instead of developing a consistent corporate narrative grounded in their actual business model.
Who's Doing It Right? Stripe maintains disciplined messaging about being infrastructure for internet commerce, avoiding trendy pivots
Leadership and Vision: Neumann pursued simultaneous expansion across geographies, product lines, and customer segments, without mastering their core business.
Who's Doing It Right? Airbnb focused on its core home-sharing business until it achieved profitability before exploring adjacent services

5 Hacks Decart used to turn $18M into $1.2B Sales

Did you know that Decart's founder, Elena Chen, turned down acquisition offers from three different tech giants before the company's first seed round?

Before ChatGPT became a household name, this quiet GenAI startup was already building the infrastructure that would power the next generation of business tools.

Elena Chen and co-founder Raj Patel launched Decart in 2019 with a contrarian vision of building enterprise-ready AI infrastructure when everyone else was chasing consumer applications.

Unique Value of this Unicorn:

Efficiency-First Architecture: Developed models that required 70% less computing power than competitors
Privacy-Preserving Design: Created a novel approach for training on sensitive data without exposing it
Vertical Integration: Built customised AI models for specific industries rather than generic solutions
Developer-Centric: Prioritised robust APIs and developer tools over flashy demos
Enterprise Focus: Targeted regulated industries, others avoided due to compliance challenges

3 Major Triggers for Overnight Success:

In 2021, Decart made a pivotal move that would define its trajectory: investing $18 million, nearly half its Series A funding, into creating specialised AI infrastructure for healthcare and financial services.

Regulatory Tailwinds: New FDA and financial regulations started enabling AI adoption in previously resistant sectors
Talent Availability: The pandemic created access to specialised AI talent that was previously locked up at big tech
Data Maturity: Healthcare and finance have reached sufficient data standardisation to enable truly valuable AI applications

Financial Milestones:

While many GenAI startups are struggling with monetisation, Decart has achieved the rarest of combinations: hyper-growth with positive unit economics.

2021: $5M ARR, primarily from beta customers
2022: $28M ARR after launching healthcare and finance verticals
2023: $75M ARR with 180% net revenue retention
2024: $150M+ ARR run rate and $1.2B valuation

"Everyone was chasing consumer AI applications for quick wins. We deliberately chose the hardest problems. Once we solved those, we'd have an unassailable moat." - Elena Chen, Decart Founder & CEO

5 Strategies Decart used to turn $18M into $1.2B Sales

Contrarian Timing: Decart focused on enterprise AI when everyone was chasing consumer applications; startups should map competitor investments and deliberately target adjacent areas, which are receiving less attention.
Who else does it? Snowflake: Entered the data warehouse market when conventional wisdom said it was commoditised, yet found massive untapped potential.
Technical MOAT: They built industry-specific models with specialised knowledge rather than general-purpose AI. Go hyper-focused on 2 or 3 Major shortcomings in the ecosystem.
Who else does it? Databricks: created a specialised approach to data lakehouses that competitors struggle to replicate
Regulatory Arbitrage: Decart specifically targeted healthcare and finance because regulatory barriers created a competitive moat. Founders need to view regulations as an opportunity for creation rather than a limitation
Who else does it? Stripe: Built specialised infrastructure for financial compliance that created massive barriers to entry
Scale Infrastructure: Committed 50% of R&D to building scalable infrastructure proactively, much before it was needed.
Who else does it? Twilio: Built an API infrastructure that could handle billions of messages before they had the volume
Data Flywheel: Decart created learning systems that improved their models while preserving customer data privacy. GDPR scalability is not optional anymore.
Who else does it? Tesla's: They approached vehicle data collection, which creates self-reinforcing advantages in autonomous driving