Sharing some Asia podcast discoveries

I love podcasts, and have been a regular user for about 15 years. I also love audiobooks, which means when I discover a podcast and start going through the backlog, my GoodReads Reading Challenge suffers.

This year I have discovered a number of deep podcast catalogs that I thought I would share (in no particular order).


AnalyseAsia

analyse asia cover art

Topic: Startups in Asia

You probably know who the “unicorns” are here in North America, but do you know what is happening on the Asia side of AsiaPac?

Map of the most well funded started in Asia-Oceania
Credit: CB Insights

Bernard Leong’s AnalyseAsia podcast features interviews with various startup founders, VCs, institutional tech economy people from all over Asia. He is based in Singapore, and there is a good amount of content about Southeast Asia which is what interested me.

For a quick hit, check out this informative interview with Justin Hall on VC in Southeast Asia →


Disrupting Japan

Disrupting Japan cover art

Topic: Startups in Japan

Earlier this year LinkedIn listed Japan’s 20 best startups to work for. On the list is a company I was interested in called Shizen Energy, a utilities startup based in Fukuoka (a place I really want to visit!) that has been building renewable energy

Looking around I found this English-language interview with founder Ken Isono on the Disrupting Japan podcast. This was a fascinating interview as it turns out the podcast host Tim Romero works for TEPCO Ventures. I did my master’s thesis on energy security in Japan, so hearing two energy people discuss how to revolutionize Japan’s (and the world’s) energy mix was brilliant. They discuss all sorts of things, including the decentralization/localization of energy projects, which reminded me of the Citizen Energy project I learned about in Ikoma-shi, Nara.

During the interview Ken Isono uses a very interesting metaphor. He argues that in the future renewables will make energy free — so cheap it won’t be worth metering. He points out that in some areas of Europe the energy price is negative. In thinking about what that future looks like for utilities, he says they will have to shift much like telecom industries after the rise of Skype 20 years ago: “International calls became free. I think the same thing will happen in energy.” That didn’t destroy the phone companies, but they had to shift their business model away from charging for long distance calls to selling other value-added services. The same thing could happen in energy.

Fascinating interview. Give it a listen.


The Meiji at 150 Podcast

UBC Meiji at 150 Podcast cover art

Topic: History of the Meiji period

I love Japanese history, but my focus has always been the Sengoku and Edo periods because of my background in classical Japanese martial arts. I almost minored in Japanese history when I was an undergrad at UBC. This year I have been exploring other parts of Japanese history by reading a few books. Then I discovered the Meiji at 150 history podcast — produced by my alma mater UBC — and well, I have been stacking up the books on my Want To Read shelf all year listening to this thing.

Last year the 1868 Meiji Restoration celebrated its sesquicentennial, and UBC kicked off a lot of projects to explore that period of Japan’s modernization. In the show, Dr. Tristan Grunow interviews academics on various aspects of the Meiji, and I have learned a lot. Just listen to the show on coffee in Japan (I bought the book).

Learning about the Asian fintech boom

After reading Alibaba: The House that Jack Ma Built with a friend, we decided to get together for a discussion with the old #StartupCoffeeKL group to go over some of our learnings. For me, the biggest takeaway was the impact Alibaba was having on the financial world. As Mary Meeker points out in the 2018 Internet Trends report, eCommerce is the culmination of a number of verticals, and Alibaba has been innovating in all of them.

Slide containing text:

E-Commerce = A Look @ Tools + Numbers...

Payment
Online Store
Online Payment
Fraud Prevention
Purchase Financing
Customer Support
Finding Customers
Delivering Product
KP 2018 Internet Trends slide on eCommerce tools

For the eCommerce giant fintech may have started merely with payment transactions, but soon turned into other offerings and eventually was turned into Alipay (2004) and then (controversially) Ant Financial (2010). The whole battle over the wallet is playing out very differently in China and is fascinating to learn about. The mix of heavily regulated banking infrastructure and wide population of unbanked has made for a dynamic context. But Alibaba has been aggressive in gaining a foothold in other markets too. Alipay has bought into Mynt in the Philippines, Ascend Money in Thailand, and in 2017 Alibaba took a $200B (40%) stake in KakaoPay, the payment arm of Korean chat giant KakaoTalk. Alibaba’s messaging platform is not that popular so it is is interesting to see them take a stake in a different platform to get the kind of business intelligence Tencent is getting from WeChat. In preparations for the Olympics, and to accommodate the massive amounts of Chinese tourists in Japan, Alipay has made huge strides, going from about 50K retailers in 2018 to more than 300K. But they are not stopping there, and are looking to bring their partners along too.

Other companies are getting in on the act. Tony Fernandes’ AirAsia is trying to make the switch from a low cost airline to a data company and has spun out BigPay. Hear him talk about this shift in this short CNBC interview.

Slide from recent AirAsia investor deck showing their shift in business model.

It is interesting to see how these payment products are being born out of other data-intensive businesses. I am not sure if you can built a payments company from the ground up with no data anymore. Grab and Gojek in Southeast Asia are also examples of this. They are both covered in this month’s fintech special report from The Economist which I recommend. Two small tidbits from that special I would like to highlight:

This quote from Singapore about competition shows that not all models are the same:

“As a public policymaker, we are working with banks to rationalise their costs, and create a level playing field for them to compete with non-regulated entities.”

This approach has had the desired consequence: fintechs in Singapore have largely shifted from offering services to consumers to offering digital services to banks.

Secondly, from the same article, I found this comment about Ant Financial by Piyush Gupta, the chief executive of DBS, Singapore’s biggest bank illustrative:

“They are getting the customer relationship and the data to create value, and then passing the regulated part of the activity to banks.”

It makes me wonder, are we seeing another Uber-style disruption in the offing? You already know how I feel about that…

In conclusion fintech in Asia is a boom that has been going on for a while but just got on my radar this year. Payments seems to be a vertical on fire (think of even Apple getting into it with their own card earlier this year), but it is not one that I fully understand. And in Asia we have a very dynamic lab that we in North America could learn from. I certainly intend to continue learning about it.

More people than bots?

In 1975, BusinessWeek magazine imagined the rise of the paperless office as computer use became more widespread. Of course, over the following two decades, consumption of paper doubled. A couple more decades on, we are finally seeing year-on-year decreases in office paper use, at least in North America and Europe.

One recent tech fascination is bots. Retailers are especially interested in bots which will allow consumers to ask unstructured questions about products and help them order pizza or whatever. Bots may be the latest advance in customer service automation, but, they aren’t quite up to scratch. There are still plenty of limits to overcome with machine-learning and natural language processing. It will not likely take four decades like the paperless office, but automated sales bots are still a ways off. In the meantime, what is likely to happen? To put it another way, how will the “paper double”?

Continue reading “More people than bots?”

The Seven revenue models

Consider the following chart showing how the Revenue per User flows for each of the major mobile platforms:

dediu_rev_models

The chart belongs to a presentation where Horace Dediu looks at the future of online services. (Disclaimer: I have not been to the event, nor have I seen the presentation.)

At first glance, my first impression was: “Only four revenue models?” (Transaction, Subscription, Ad, or a mix of the three). On second glance: “Wow Advertising is pretty much the same size as Transaction.” But then later, in the shower, I started to ask: “What does ‘transaction’ mean anyways?”

Generally there are 7 revenue models:

  • Production
  • Markup
  • Fee-for-service
  • Commission
  • Advertising
  • Subscription
  • Licensing

Horace has split out Advertising and Subscription in his chart, but Transaction seems to fold a few of those rev models inside of it. So I decided to attempt to reverse engineer the chart. Let’s take a look (click to enbiggen):

Transaction is made up of four subcategories: Transportation, e-commerce, Travel and App. I reorganized each of the companies featured in the slide into their category, then labelled each with one of the five remaining revenue models (Production, Markup, Fee-for-service, Commission and Licensing). This is a complex endeavor since some of these companies do more than one thing. For example Amazon sells its own hardware, sells other people’s products, and licenses you Kindle and Audible books. Ridesharing companies charge you a fee-for-service and then take a commission from the driver (doesn’t sound like “sharing” to me, but that is another post).

Inside of the Transaction category the biggest group belonged to the Markup category. I have no way of separating out production and licensing revenues from those companies, but even simply adding them all up and comparing them you can see that Ads are bigger than any one Transaction subcategory.

dediu_ad_v_markup

Hey, ads are big (and growing), we know that already. But that fact may be hidden in Horace’s chart.

Why go through this exercise?

True, since I do not have access to the data set, and do not know what Horace’s intention is for this particular screencap, I could be speaking out of turn. That said, I find it very interesting to see how consumers are parted with their money, myself included. Think about what you spend your money on each day, and think about what you used to own, compared to what you merely rent or lease today. I don’t own much of anything anymore, not least my hundreds of Kindle and Audible books, iTunes tracks, or Google Play Movies and TV Shows. As a minimalist, I am okay with owning less, but I have issues with proprietary formats (I now use Downpour for audiobooks), and it seems especially egregious as they are pushed into the real world (ahem… John Deere).

For all the talk of innovation there has not been much on the business model side. We have had these 7 revenue models for a long time. Regardless of how dominant the Ads model is, it doesn’t work for everyone, and is in fact failing many of our vital institutions it once supported (ahem… public interest media). Unfortunately, most of the “innovation” around business models have been on the finance side, with very “innovative” accounting and debt models (ahem… [subprime lending](subprime lending)). The results have been runaway household debt and financial collapse. As with all things, technology helps out here too.

So, Innovators, we could use some new revenue models that are straightforward, and not detrimental to consumers.

Putting humanity back into startups

Startup culture is pretty absurd. You can seriously criticize its neoliberal, technocratic ideological underpinnings, or you can satire it with shows like Silicon Valley. Hackathons are ripe for criticism too, but there is a place for laughs. Listen to this great Radio Berkman ep about “Comedy Hack Day,” where they embrace the absurdity of the “app-happy Cloud of anesthetized convenience”:

This reminds me of another Hackathon I heard about from last month:the Stupid Shit No One Needs & Terrible Ideas Hackathon where an amazing CLI for Tinder was released, among other stupid and funny inventions. At last year’s local Startup Weekend Okanagan the winning team used humour to get an edge, building an app that routes your txts through a friend for approval before sending — for those times when one is inebriated and should not be sending ill-advised, late night missives to former lovers.

Baratunde Thurston (of The Onion fame) ends the Berkman podcast (at about 10:20) with a comment worth highlighting:

Technologists, I think, its very important as architects of our future… that there’s a dosage of humanity in that. And there’s not much more human than humor.

These examples aren’t specifically political or social critiques about technology per se, but the potential is there. I like to read (and sometimes write) high-minded, literary critiques of this business that I am in. That is certainly valuable, and works. But humour is another way to make people aware of the absurdities of this business, and is an enjoyable and artful way to valuable tech criticism.

Local startups! Protect our shared resource!

The internet is like the sea, a vast and shared resource that we all depend on. Unfortunately we do not have anything like UNCLOS to help protect that resource from the countries and companies that threaten it. So much of the innovation and content on the internet is the result of individual users like us. Well, so is the responsibility to protect it.

Luckily we have some grassroots organizations to help coordinate individual efforts. Here in Canada we have OpenMedia, which I have mentioned before and you have probably seen me tweet about. I’ve been a member for a couple of years.

This month they are reaching out to fellow tech companies, whose businesses are all enabled by a free and open internet, to step up and contribute to the protection of that precious resource. The amazing thing they have done is got together a bunch of tech organizations to match all donations. This is the best time to get the most bang for your buck.

The campaign is called #StepUp4Net.

StepUpForNet_donate_banner

This is a grassroots campaign, led by local tech leaders. My pal Boris Mann has been working hard with cool people like Michael Tippet and Tim Bray to activate the YVR community, and I hear from OpenMedia that donations are coming in from Toronto. I would love to see some of our community members in the Okanagan and Thompson regions also contribute to this campaign.

For each one of you in your respective geographic areas, please reach out to find companies around you that are able to help. We are trying to get a couple hundred businesses to step up. Connect them directly to Open Media or even to me if they have questions. The campaign link is:

https://openmedia.org/stepup

2015 is going to be a big year with all kinds of legislation on the table regarding net neutrality, the TPP, surveillance, and lots of other issues. We need orgs like OpenMedia to augment our voice in Ottawa and elsewhere both as businesses and citizens. There is no better time to step up!

And don’t forget, you can still donate individually. Check out OpenMedia’s Donate page.

Hack startups — The state of ink-stained disruption

Two of the scariest areas in startupland are healthcare and education. These are monolithic, highly regulated sectors with long sales cycles — not particularly prone to “disruption.” In this year’s Kleiner Perkins annual internet trends report, Mary Meeker argues that these two sectors might be at an inflection point. I remain sceptical.

Another sector with hundreds of years of history and entrenched players is investigative journalism. Newspapers have been struggling since their heyday in the 1980s. Revenues are down, churnalism is up, and there are less employed reporters out there chasing down leads.

Newsroom employment over time in the US

Something needs to change, but since most revenue still comes from print, newspapers are loth to experiment too wildly. In effect, newspapers are prisoners of their own business model.

Within journalism, investigative reporting is the most difficult to produce because of the capital required and the long turn-around times involved. In our instant-gratification-mediascape, investigative journalism has fallen by the wayside. What was once a valuable service, subsidized by the the inefficiencies of bundled media empires, is now withered and cut as media behemoths look to slim down in the face of internet disintermediation. This is happening across the board of public interest content — just look at the troubles at the CBC.

I don’t think it can be argued that investigative journalism should be done away with. It is a valuable institution for our democracy — the venerable Fourth Estate. (The Fifth Estate is an extension, not an evolution). Thus, with an established pain (ie. the need to know what is going on in the halls of power) and a market (ie. every citizen), the opportunity for startup disruption is obvious, non? There are certainly a lot people tackling this problem.

AngelList has 194 companies under the “Journalism” market. Most fall under a few categories:

  • marketplaces selling for photos, videos or writing
  • content management platforms for writers, editors, publishers
  • citizen journalism platforms
  • delivering breaking news (usually via social)
  • aggregators and curators (again, backed with social)

Many are solving the problems of “information overload” (through curation) or distributed workforces (through publishing platforms) but as far as I could tell, none are focused on solving the business problem of funding long-term, quality reporting. Paywalls and online advertisements do not suffice.

One solution is lots of money. Pierre Omidyar, the billionaire founder of eBay, started First Look Media with some interesting new ideas on how to fund real journalism (I encourage you to watch the video). Last year, Jeff Bezos of Amazon purchased The Washington Post. We are still unsure of how WaPo will change.

I am one of the few people that is actually willing to pay for content. I have subscriptions to a few established news outlets (Foreign Affairs, Globe and Mail, The Economist etc) and I have even supported some startups in the space. I backed Matter (later acquired by Medium) which tries to solve the problem of terrible science and technology reporting. They had a community-based editorial board where members could vote for allocating commissions.

Another outlet I have used in the past is Atavist. They have an interesting model in that they are a product company that commissions longer pieces to feature its platform. The non-fiction pieces can sometimes approach investigative journalism. The business model is subscriptions and micropayments, and the selling of their publishing platform Creativist.

Most recently I have discovered a Canadian startup Ricochet Media. I heard about them on Jesse Brown’s Canadaland podcast. Ricochet is trying to square the circle of funding independent, investigative journalism in Canada. Like Beacon, Vourno and Contributoria they are going with a crowd-funding model. Like Matter they have a community-driven editorial process. They are trying to get off the ground by crowdfunding themselves on IndieGogo. We shall see how they do.

Journalism is a “hard problem.” Some have argued that it has been failed by the market because you cannot treat citizens as consumers. Some say public-interest journalism should be considered a public good. If this is true, traditional startups will have trouble disrupting anything due to their market-first orientation. There could be some business model innovation that could work, or maybe a SocEnt solution. It might come down to [shudder] consumer education and teaching people to pay for valuable things. I don’t know the answer, but this is a sector that I am deeply interested in and hope we get a solution soon.

Growth

So far this has been an explosive year for the Kelowna startup community. For the past few years the community has been germinating inside the Kelowna Innovation Center, which served as the single hub for all startup activity. Now we are seeing more and more happening beyond those walls — a positive development and a signal of maturation.

Local startup legends Vericorder and Vineyard Networks (now part of Procera) scaled out of the KIC years ago. Many of the early stage startups in Accelerate Okanagan have been hoping to do the same. Last month Syndicate Theory left with Cityseed to join another stealth startup at the new Rocketlaunch space. This past week FreshGrade moved into a new space called Wheelhouse and Just be Friends set up their new office space. Soon Hyper Hippo will be moving into a brand spanking new building, and I suspect taking with them one or two other small outfits from KIC. Furthermore there are rumours of two more startup-centric spaces on the horizon. This might just be #startupkelowna’s Big Bang moment.

All of a sudden we have transitioned from a single to multi-hub community network. Such a distributed system is great for innovation, but we must remember that it is an ecosystem. As a community we must double our efforts to keep the communication lines between the hubs open to prevent isolation. We at Rocketlaunch intend on hosting events for developers in our space, and you will always be able to see the Syndicate Theory boys at the various tech meetups in Kelowna. I implore the other hubs to do the same or better. There will be growing pains, but we have the lessons of many other communities that have followed this path before us.

What are you going to do?

Startup Weekend Okanagan AAR

It has been a week, and I think I have finally recovered from Startup Weekend Okanagan. I had a total of 7 hours sleep over the three days of taking a product from concept to pitch. The team was a powerhouse with 5 devs, a designer, 2 biz/cust devs, and me (a product dev). Throughout the weekend, we never thought we had a chance of winning, and were in it for the love of the product, the love of the tech, and fun. In the end, our enthusiasm prevailed and we were able to take home top prize, even though I think half of the audience still had no idea what it was we made.

1st place: Arkitektor
Champions, with AO CEO Jeff Keen on the left, and city councillor Colin Basran on the right

The Arkitektor concept was formed out of a #devKL session where we discussed visual modelling. Our fearless team leader @neh decided that we should use Startup Weekend as a chance to try and build the product development app of our dreams. At the pitch he said “graph database” and boom! He had a team. Originally, I wanted to join a team with people I didn’t know. However all the other pitches did not excite me as much as Arkitektor, which I threw myself into.

It was a tiring/amazing experience. I truly believe that the amount of talent on the team made it a once in a lifetime experience. I didn’t get much of a chance to learn Node.js or Neo4j as I spent so much time on the planning, presenting, biz and cust dev side(s) of the project. I was pretty ragged by the end.

I was very happy that SW integrated market validation into the judging this year. At the #devKL beforehand we were planning on pushing such an agenda and basically told all the dev’s not to make anything until it was proven. The Arkitektor team used both the Lean Startup Machine’s Validation Board and the Business Model Generation tool.

I had a crash course in delegation. Our dev team was experienced and could quickly get up and running, but our designer and biz people were not used to working in a startup environment. I introduced a kanban style task list to the biz people, which worked pretty well. I hope they got a taste of what startup life is like: you cannot afford to be a specialist, you cannot wait to be told what to do, you must use your initiative.

My other big lesson learned was the importance of honing your message. I practiced explaining our concept to as many people as I could, and even though I felt I got better, we still were not able to to explain it to a non-dev in two or three sentences.

Prize

The only thing that I would suggest to the organizers, other than providing lighter meals, is to have a physical object to award the winners, even if just a piece of paper. We had no idea what we won, and had nothing to show for it, which was a bit anticlimactic.

If we are to have this thing every year in Kelowna, I think it would be great if we could make an 8-bit trophy, maybe 3D printed, to give to the winning team to keep in their office until the next year.

Taking Startup Weekend into another dimension

Speaking of 3D, I think it would be brilliant if we had a special edition of Startup Weekend that focused on physical products, with 3D-printed prototypes. It is hard to imagine what amazing products would come out of such an event. I am sure physical product-focused events like Startup Weekend happen all the time in other contexts. However, Startup Weekend has typically been the purview of digital products, and we find ourselves in an era of bit-pushers being able to push atoms, bringing all their web and graphic design skills to the physical world. We could even get Objet or some other company to sponsor the printers, and have to include the lengthy printing time in the development strategy.

Furthermore, think of the new types of people that would be introduced to Startup Weekend. Kelowna has healthy gaming and animation communities, filled full of modellers that would be worth their weight in gold on a 3DSW team. It sounds like lots of fun…

Well, what do you know, it has already happened!

Wrap-up

Highly recommended. We are still considering whether to make Arkitektor in real life. Regardless, I will be there next year, hopefully as a well-rested volunteer organizer.

Software Tree of Life follow up

Whiteboard from #LeanCoffeeKL 74

I presented my idea of the Software Tree of Life at #LeanCoffeeKL #74. It was a pretty high concept session but I think it challenged everyone that attended. It certainly challenged me as the attendees brought up a number of interesting points I had not thought of. If you look at the full-sized whiteboard photo you will notice on the right a list of “Other Factors.” Other than the industry specific factors of which I alluded to in my last post, most of the points can be summed up into two considerations: 1) competition, and 2) capital.

I mentioned the red ocean of competition in my last post, but it was brought up that in the Regulated Enterprise Kingdom, there is are often very few competitors. The market is yours if you can get into it. If you already have an in, this will seriously impact your opportunity assessment calculus. Further to this, it was proposed that there is such a thing as a Regulated Consumer Kingdom, for example customer-facing software for banking or telecoms. An excellent point.

Capital wise, some branches of the tree take much more initial capital in order to enter. This could mean cash, physical capital and even knowledge capital. R & D costs to understand the domain before building a solution can be exorbitant for some industries. Having domain expertise on your team will be a must, and could be a high barrier to entry for you in these cases.

The final point that I would like to highlight from the session is something that I have talked about at length previously (eg. Getting customers in the enterprise) but did not make the connection with regards to the Tree of Life. It is the consumerization of the enterprise. This is a recent trend in technology and it is still far too early to determine whether or not will be all encompassing. However it is intriguing to consider the possibility of all of the top level branches of the Software Tree of Life merging into a single hybrid (note the green dotted lines on the whiteboard).

As entrepreneurs it is always beneficial to share stories and discuss the intricacies of daily startup operations. I maintain that it is also worth examining how the innovation ecosystem works as a whole from time to time. I think that is the part of being an expert in the field.