more profitable than OnlyFans?
Moontower Munchies #90
Friends,
Let’s set expectations. This post has nothing to do with Sophie Rain despite the title.
Sorry to spill cold milk on your pepper.
Instead, you know I’ve been on this on this kick of reading snappy company manual/manifestos (37Signals, Gumroad).
Well, I think I met the final boss of this genre after just 3:
Valve
Valve is the gaming company behind Half-Life, DOTA, and the Steam platform. I’m not a gamer (unless you count NHL ‘94 and Contra — fun fact I’ve beaten Contra 3x thru on a single life. Because it’s the only Nintendo game I had for about a year) so I’m not especially familiar with Valve.
My friend Dan mentioned how ridiculously successful they are but also their extremely unusual org structure. Flat as a pancake. So flat in fact that it seems like it’s the adult version of a Waldorf school kindergarten. Just do what you want.
You’ve gotta read this employee handbook:
A fearless adventure in knowing what to do when no one’s there telling you what to do
It’s ~50 paragraphs long plus some pictures. Like this one:
What’s their special sauce? I have no idea but they aim to hire insanely talented people which they refer to a “T-shaped”. World class in one domain and then very high percentile across multiple disciplines.
They are a private company. They might be the most profitable company in the world per employee with revenues in the ballpark of $13b with about 350 employees. A lawsuit revealed that Steam made over $8b despite having only 79 members on the team.
By comparison, Jane Street has made close to $10B in each of the last few years with over 2,500 employees (JS is apparently up about $14b thru the first 9 months of 2024 btw) which is more than 4x profitable than Goldman.
More perspective on how insane Valve is:
But the best part of hearing about Valve was this video my friend told me to watch. It’s their founder Gabe Newell giving a talk at UT Austin in 2013. A history lesson and so much more. Enjoy!
Gabe Newell: On Productivity, Economics, Political Institutions, and the Future of Corporations
From My Actual Life
If you have any interest in Egypt or really just another culture AND crave some great writing I can’t recommend Peter Hessler’s The Buried: An Archaeology of the Egyptian Revolution enough (h/t Kamil for the rec).
Alongside World For Sale, it was my favorite read of 2024.
The Guardian’s description captures the flavor:
Hessler is a skilled practitioner of what might be called “slow journalism”. He focuses not on the splashy events of capital cities, but instead on the ordinary lives lived far from the centre of things, as if he were transposing to the Middle East Turgenev’s Sketches from a Huntsman’s Album. He makes friends with people whose ways of living are undergoing rapid and often uncomfortable change, and writes about them with intelligence and sympathy. What separates him from most other foreign correspondents is a strange alchemy in his writing and storytelling that gives him an ability to spin golden prose from everyday lived experience.
Hessler’s narrative is educational, poignant, often hilarious and always poetic. The writing is top-flight stuff.
It had extra oomph for me because I know Egyptian Arabic. It’s weak but I didn’t need him to translate any of the words he phonetically spelled in the book. Although I can’t read fusha despite taking 12 credits of it in college to fulfill a language requirement.
There was an unexpected personal treat in the book — a Chinese/Egyptian mashup story. Hessler had written multiple books about China after living there for many years so in The Buried he has long sections where he contrasts Egyptians to the Chinese. And this is not just indulgent — he spends lots of time with the Chinese he meets in Upper Egypt who have a lockdown on the lingerie business there (the entire lingerie side-quest in this book is amazing). The Chinese perspective of their Egyptian neighbors is astute. Hessler thinks the Chinese and Egyptians are polar opposites. Something my Chinese/Vietnamese wife and I have also thought.
Overall the trip was pretty epic (and sickness-free unlike Portgual this summer). Happy to share details for anyone who might visit. The general itinerary was:
Cairo (and pyramids)
Abu Simbel (flew in for 2 hours and back out)
Nile Cruise (stops in Aswan, Edfu, Valley of the Kings, Luxor)
Hurghada (Red Sea resort)
Highlights included:
monuments and temples of the ancient world (my favorite temple is Karnak which is the second largest in the world — there’s a larger one in Cambodia but it’s a baby….only 900 years old)
the tombs at the Valley of the Kings
the new museums in Cairo (the mummy exhibit is much nicer now than my last visit in 2005).
…and taking my 11-year-old scuba diving for the first time!
Oh, one last thing…
This Egyptian hustle porn on papyrus in some tourist gift shop 💀
Stay Groovy
☮️
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I am a gamer with probably like 7k hours in DOTA and I've following Valve for quite a long time. Their secret sauce is that they aren't a corporate that is run by guys who's only videogame in their life was Excel Spreadsheet and efficient management. They are a company that is built by gamers and for gamers and thus they have a VERY deep understanding of gamers psychology.
Another thing that their doing is they aren't generating their own ideas for projects. Instead they are hiring community members that were basically doing cool stuff for the sake of cool stuff for free and they are giving them resources to do it even better. Best example is DOTA, which was a custom map for Wacraft3.
Gaben learned a lot from Blizzard who were the same and made legendary games like Warcraft, Starcraft, WoW, etc. I remember being a child and waiting for those games being in development for 5-6 years. And they never had any dealines, the mode of operations was "when it's done". Imagine something like this in a corporate! Everything changed when they went public and were slowly overtaken by efficient management. Never made a single good game since, everything is just absolute crap (Diablo 4 included). And in 2020 Mike Morhaime left Blizzard to found his own studio that is developing their first game since then.
That being said people say Valve is in deep stagnation right now because of Steam. Steam ended up being SO GOOD that it effectively monopolized online game sales and is generating a lion share of Valve's revenue eith very little effort. So essentially Valve is in a resource curse state right now and that's why they basically had zero successful projects over the past many many years. The new game, Deadlock, looks interesting, but its essentially first-person view DOTA and for some reason I have a feeling that it won't be even close to DOTA-level success.
I can't believe you didn't mention that 'killing people' is among the generalist skills the ideal T-shaped employee has.