Media Hype, Innovation, and Imitation

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Recently, there has been a lot of Uber talks. It seems that everywhere I go, I hear the sound of Uber. As a tech entrepreneur, this could be good and bad. A unicorn startup can serve as an inspiration to many startups and entrepreneurs. But it can also be the culprit of too much unnecessary imitations, because the misleading signal suggests that there is an abundance of resources/capital in a single industry.

We all remember what happened to the daily deals industry, which attracted everyone’s attention in the tech circuit in 2012 when Google offered $6bn trying to buy Groupon. But now it’s all smoke and mirrors. Will the same thing happen to on-demand ridesharing industry in the future? Is there too much media hype about Uber these days? What are the consequences? I share my perspective in this week’s CoInvent newsletter. Here is what I wrote:

 

Silicon Valley has long represented something positive and innovative. When we discuss Silicon Valley, we think about Google, Facebook, or Apple. However, what goes up must come down. I believe with the good things, there are many problems existing with today’s Silicon Valley. Hype is one of them!

Last week’s big news came on Friday when Financial Times reported that Uber is out trying to raise $1 billion more with a higher-than-$17B valuation. The media went nuts! Actually, I don’t recall to hear anything else but Uber in media headliners theses days. Here are just a few from last week:

Uber, Uber, Uber… When we get too obsessive with one particular startup, this country’s innovation rate goes down. We all know how many daily deals sites sprang up when Google offered $6 billion to buy Groupon back in mid 2012. Fast forward to today, we all know how group buying startups are doing. For example, LivingSocial just laid off 20% of their employees last week. What we need in Silicon Valley is objective reporting, less hype, and more work. What we should do is innovate in new industries, not trying to do another Facebook, Uber, or Yelp clone. Too much media hype can cause excessive imitation, which can be detrimental to innovation.

 

I could be wrong. But only time will tell whether the media frenzy will speed up or slow down Uber’s future growth.

How Technology is “Eating Up” Traditional Industries – Part I

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For millennials, we are the lucky few because no one else before our time could have witnessed such a spectacular technological shift that almost impacts everything we do in our daily life. Because of technology, we now can consume hours of streaming content on our plasma TVs or tablets. Because of technology, we get to enjoy the convenience and freedom that ridesharing startups create? How is technology “eating up” the world? And how much are we exposed to it? Here is a sneak peak of some of the issues we will address at the upcoming CoInvent Startup Summit.

The goal of the summit is to address the disruptive roles that technology plays in traditional industries such as marketplace, education, payment, finance, media, funding, social, and fashion. For the first half of this series, I will explain below how technology is impacting these sectors: marketplace, education, media, and payment.

 

Marketplace

Marketplace is the epicenter of the “Software Eating The World” movement because online shopping sites like Amazon.com are actually changing consumers’ buying behaviors. Five years ago, you might enjoy buying a book at Borders or Barnes and Nobles, where do you buy your books today? I do it directly on my Kindle. It takes a minute to complete the purchase and get it downloaded to my Kindle device. How about grocery delivery startups such as Instacart or Freshdirect? The fact is, traditional brick and mortar commerce model has been disrupted and will continue to be. It’s an exciting time if you enjoy the convenience of online shopping.

Education

Education is one of those areas that have not been completely disrupted by technology yet. We all know the problems that come with traditional school-based education system. The fact is many entrepreneurs realized they needed to find solutions to make education more affordable and convenient with technology, and they are trying. Enter education 2.0, which introduces an array of exciting education startups – language learning with Duolingo, taking a programming or design class with General Assembly, getting a verified college certificate from Coursera, or learning pretty much everything for free on Khan Academy. Even with all these startups, the education system in the world has not been democratized enough. For that to happen, we need more entrepreneurs, startups and ideas to work on more education-related problems.

Media

The traditional print media industry has been utterly “destroyed” by technology. The latest victim is Macworld Magazine, which, after 30 years, is no longer a magazine. And it laid off most of its staff. As an entrepreneur, I get all my breaking news on Twitter, Techmeme, or Cir.ca these days. Getting Wall Street Journal delivered to my doorsteps was so 2009. On the other hand, streaming media play a larger and more crucial role now than ever before. Recently, HBO finally revised its business model and planned to introduce a standalone HBO Go subscription service for its cord-cutter demographics. The service is said to be live early next year. Media and entertainment industry will continue to evolve. As an entrepreneur myself, I feel blessed to be in the middle of seismic and powerful shift. The new media tools will open doors for much better lifestyles – exciting and efficient ways to consume media content. Netflix, Hulu, Amazon Prime, Apple TV, Chromecast, and Roku are all competing for a piece of this market. This is the beginning of a new era!

Payment

Along with Airbnb and Dropbox, Stripe is one of YC’s most successful startups ever. Stripe is one of those unicorns that investor wish they could have invested in. It’s making payment industry more efficient and better. Same can be said about Bitcoin, although this topic can be controversial. Payment tech is here to stay. Apple’s foray into the payment industry – advent of Apple Pay – further legitimized this prediction. Now the fight in payment tech is among the big boys – PayPal, Google Wallet, Stripe, Square, and Alipay – just to name a few. It remains unclear who will be the ultimate winner or they will continue to co-exist. But one thing is clear – when big companies compete, small business owners win! The result is lower rates and less fees.

 

Next week, I will cover the remaining four topics – finance, funding, social, and fashion – part of what the Dec. 16th CoInvent Startup Summit will address. A partial list of the conference speakers has been released – including CEOs and senior VPs from Wix, Seedinvest, Betterment, Cover, Plated, Zipmark, Triberr, etc. We will have more speakers to add in the coming days. Subscribe here for free updates.

My First Tweet Storm

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It’s not hard to guess that my first tweetstorm actually has something to do with media & entertainment. When I grew up in China in the 80’s and 90’s, video cassette and DVD were the equivalent of what we call today the “home entertainment theater”. Then the Internet came. And there was an influx of pirated content (movies + music + games). For the millennials, I suspect that we all used BitTorrent to download free movies at one point or another.

Today, we are all used to the notion of streaming Netflix or Hulu content directly to our big-ass screen TVs, but people outside of United States – including those in China – may not have the luxury to enjoy authentic copyrighted content like we do. That’s why when I read that Alibaba is trying to strike a deal with Hollywood, some ideas immediately entered my mind. That’s when I had the impulse to compose my first tweetstorm below:

 

1/6 – The Alibaba/Liongate deal certainly sounds interesting. Actually, could be a game changer for China http://goo.gl/u7VCZg

2/6 – Alibaba could be one of those co’s that eventually right the Chinese media industry, w/ less and less pirated content year after year

3/6 – Whatever happens in China today, think of it as if it was the US market 5 years ago, i.e. pirated content, entrepreneurship, education

4/6 – But China has been accelerating to catch up to US, the innovation pace is speeding up, and distance is shortening

5/6 – In that sense, it’s just a matter of time before you see the next Chinese Netflix or Hulu hit the consumer tech market

6/6 – Alibaba will, no doubt, play a pivotal role in shaping that market via its partnership or internal corporate innovations

 

 

Zero to One

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zero to one

Reading Peter Thiel’s new book Zero to One right now. I’m almost through the book. It’s a great book to read if you are an early adopter, entrepreneur, or technologist. When asked what the title “Zero to One” actually means by NPR, this is Peter’s answer:

The basic idea is if you sort of think about innovations where there’s someone who builds a first airplane or first home computer or first smartphone that works like the Apple iPhone, these are what I call zero to one innovations. And I think technology involves intensive, vertical, zero to one progress. Globalization involves horizontal, copying, one to end progress. And we’ll need both of these in the 21st century. China is sort of the epitome of globalization. What China does is copy things that work. And it has a very straightforward 20-year plan which is to make itself look more like the U.S. and Western Europe. For the developed world – Japan, Western Europe, the United States – progress is a much trickier thing in 21st-century because to take our civilization to the next level, we need to actually do new things. And so I think the question of how do we develop the developed world is a question that’s not often asked but is worth for us to look about a lot more.

 

 

In the following conversation between Marc Andreessen and Peter Thiel, you can learn more about the context of this book.

 

Open Message to CoInvent NY Meetup Group

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Earlier today, I sent this message out to the CoInvent NY Meetup group regarding the upcoming CoInvent Startup Summit:

Good morning,

At CoInvent, we are always looking for better ways to make things more efficient, scalable, and impactful. This morning, I would like to introduce our debut startup conference – CoInvent Startup Summit. We plan to roll it out in our New York market first in 2014 and then nationwide in 2015. With the launch of this conference, our goals/priorities remain the same. They are:

  • help founders/startups/businesses connect with potential customers/users, partners, investors
  • help founders/startups/businesses extend their runway via opportunities to raise more funds or create more revenues
  • help founders/startups/businesses make better hires by connecting them with passionate and like-minded individuals
  • help founders/startups/businesses find a better product/market fit and get advice from industry insiders

I think those four goals are pretty inclusive and applicable to most early- to growth-stage startups and companies. The Dec. 16 conference focuses on addressing the “Software Eating The World” theme – the disruptive roles that technology plays in our daily lives. All talks and panels feature industry experts and insiders. With this announcement, I have both good news and bad news. Bad news is that we only have a few hundred tickets, which are likely to be gone soon. But the good news is, you can start ordering tickets now at www.coinvent.co/events/cssny14­, which is the ONLY event registration site. We have introduced 20% – 30% of the speakers thus far. They are:

  • Ryan Feit – CEO and Co-Founder @ Seedinvest
  • Ari Rabban – CEO and Co-Founder @ Phone.com, Inc.
  • Mark Wachen – Managing Director @ DreamIt Ventures
  • Charlie Kemper – Co-Founder and Managing Director @ Entrepreneurs Roundtable Accelerator
  • Dino Dogan – Founder and CEO @ Triberr
  • Nick Taranto – Co-Founder and Co-CEO @ Plated
  • Miranda Tan – CEO and Founder @ MyPRGenie, Inc.
  • Nihal Mehta – Founding General Partner @ ENIAC Ventures
  • Mallory Blair – Co-Founder @ Small Girls PR
  • Jonathon Ende – Founder and CEO @ SeamlessDocs

For more speakers, check out www.coinvent.co/events/cssny14­

When: 8:00 AM – 5:30 PM,  Tuesday, Dec. 16th
Where:
Anchin Block & Anchin LLP
1375 Broadway #23, New York, NY 10018

For new speaker updates, subscribe to our newsletter at www.GetCoInvent.com.­ For conf sponsorship opportunities, shoot us a note at www.coinvent.co/sponsors­.

Cheers,

-andrew (@andyrwong)

The original message can be found at www.meetup.com/coinvent/messages/boards/thread/47677432.

5 Questions about Hong Kong’s Occupy Central (占领中环)

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The Occupy Central movement – also known as Umbrella Revolution – has lasted for exactly 7 days now in Hong Kong. Why Beijing doesn’t grant Hong Kong full democracy can be clearly understood since a completely autonomous electoral system in Hong Kong means that Beijing must give up political controls in one way or another. Now that Occupy Central has garnered much international attention, here are the 5 questions that I have about this movement:

1. will Beijing compromise eventually?

2. how far are the protesters willing to go for what they call the true western-style universal suffrage?

3. will the movement take away the freedoms that Hong Kong does have now?

4. is the movement really affecting Hong Kong’s economy, and to what degree?

5. will the Umbrella Revolution end peacefully or violently? What happens next?

This is a raw video that Vice created documenting what’s really happening now in Hong Kong. As the movement unfolds, I hope some of the above questions should get answered soon.

A Few Thoughts on On-Demand Car Sharing & Where It’s Going

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Software is indeed eating the world. It affects every facet of our lives. We can feel it wherever we go. Recently, I found myself hitting the Uber and Lyft apps on my iPhone more often than ever. Here were some recent experiences I had with these rideshare apps:

1. For my recent trip to west coast, I got to test both a cab and Uber from Los Angeles International Airport to Santa Monica and vice versa. The cab cost me $50.45 and, the Uber ride cost $22.90 as shown below.

2. Since Lyft gave me a bunch of free riding credits, I’ve been using Lyft a lot lately especially in NYC.

2014-09-29 09.07.38

3. Last Saturday, I was trying to get a Uber or Lyft to get to 45th St & 3rd Ave (from 23rd St & 7th Ave) for a conference. Instead of paying the surge price advertised by Uber and Lyft of at least $14, I got a yellow cab, which cost me 10 bucks.

 

The above observations tell us that rideshare apps can make our lives easier sometimes. But in other times, it has its drawbacks. I am a big proponent of the on-demand car sharing industry, and have been thinking a lot about its long term sustainability. In my opinion, here are the 3 macro external factors that I perceive will shape the future of this industry:

 

Government Regulation

For a long time, Uber has been known for fighting legal battles from DC to San Francisco to Europe. A German court has recently banned Uber’s service nationwide in Germany, imposing one of the biggest legal challenges Uber had ever faced. If Uber continued its operations in Germany, it could face fines of up to $330,000, or its local employees could be jailed for up to six months, according to New York Times. In addition to local regulations, rideshare companies such as Uber, Lyft, and Sidecar are also facing other legal challenges such as driver insurance and airport policies. A Houston Chronicle explains it very well regarding why some airports in the US consider banning rideshare pick-ups and drop-offs:

In all cases, the airports are huge revenue engines for the cities, which treat the airports as quasi-governmental entities that operate under a board of commissioners. With so many taxis, shuttles and others using the airports to make money, the airports take a cut by requiring permits. Ideally, that means roads are improved and the airport is designed with huge taxi and shuttle demand in mind. The permits and fees are nothing new, and they’re similar in their setup to the paid parking common at airports.

 

Competitive Forces

Competition plays a big role here. As I mentioned before, services that Uber and Lyft provide are, essentially, commodities, which means they are replaceable and interchangeable. For consumers, they are just an app away from the next one available. Recently, Lyft has seen its drivers’ income drop by as much as 48% in certain areas in CA due to cancelled rides by recruiters hired by Uber. Lyft has also added the a feature in its app to flag Uber recruiters. As consumers, we couldn’t help but wonder how much money these rival forces will spend to fend off each other during these attacks. In addition, there seems to be an influx of new rideshare apps springing up especially in Asian market these days, which makes the on-demand car sharing industry extremely crowded and competitive.

 

Driver Strikes

I’ve found that drivers in rideshare industry are increasingly entrepreneurial these days. Some of them have very high earning expectations. So when Uber extends a customer discount and cuts deep into drivers’ wages, it’s not uncommon to see the following scene, where Uber drivers gathered outside of Uber’s Long Island City offices in early September to protest the low fares.

grid-cell-30869-1410476390-9

Photo by Uber Drivers Network via Facebook

 

Despite all these challenges, I am still a big believer of the on-demand car sharing industry, because I personally have benefited tremendously from the convenience that these services provide. Due to that very reason, CoInvent has partnered up with Via – a rideshare service in premium vehicles driven by professional chauffeurs for just $5 a ride. Right now, the service is only available in selected areas in Manhattan (primarily the UES and Midtown East, with expansion coming soon). I believe in the Via service because, if it’s successful, it’s possible that it will change my entire commute habit in NYC. Currently, I’m paying at least $2.50 (subway) when I take public transportation from point A to B in NYC. With just $5 a ride, I wouldn’t mind paying another $2.50 to make my life hassle-free. I have to admit that Via is one of those big ideas that get you excited and curious.

For readers of my blog and CoInvent members, you can now use code “COINVENT106” to get 3 free rides when you download the Via iOS or Android app. If you plan to attend our NYC startup mixer on October 6th, you can use their service to get to and depart from the venue – Iron Bar (713 8TH AVENUE in NYC). Via will have enough drivers and cars on the group that evening. You can also come to the event to chat with the Via team on October 6th since they will be showcasing their product. We look forward to getting your feedback on this product!

Recap of CoInvent SF Launch Event

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Last Tuesday’s SF Launch Event was well received by the Bay Area startup community. Although it was our first event in SF, close to 400 people RSVP’d for our event. Compared to NYC and LA, SF has a more developed tech ecosystem. When we talk about SF Bay Area, we think about symbolic things such as Silicon Valley, Y Combinator, Stanford, or Sand Hill Road. CoInvent is happy to start building its presence there, even though it means we will be a little fish in a big pond. Our next SF event is schedule at GA’s new location at 225 Bush Street, which, according to what I heard, is three times bigger than their current space. In the meantime, enjoy this recap.

 

4 Key Takeaways from The Alibaba IPO

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alibaba

I wrote about this in this week’s CoInvent newsletter. Just I’d post my thoughts here again. Here is the original content from the newsletter.

There certainly has no lack of coverage of Alibaba’s IPO last week. For those of us living in the States, Alibaba may not be as relevant to our lives as, say, Amazon.com. However, when you take over 80% of China’s e-commerce market, you can take over the world. According to a Reuters report, Alibaba IPO ranks as world’s biggest after additional shares sold – $25 billion raised, surpassing the 2010 record of $22.1 billion set by Agricultural Bank of China.

As an entrepreneur, here are a few things that I learned from the Alibaba story:

  1. Your customers are the king! Treat them well and they will take care of the longevity of your business
  2. No matter whether you are running a 10-person startup or Fortune 500 company, have a global strategy, because the majority of your customers in 10 years will be coming from developing countries – assuming if your business can last that long
  3. Silicon Valley is not the only game in town. Now you can pretty much build a household startup name from some top cities in the rest of the world – LA, New York, Chicago, London, Berlin, Hong Kong, Beijing, Seoul, New Delhi, etc
  4. Have a revenue strategy for your startup from the get-go. At one point, Alibaba had no revenue and almost got killed by eBay in the China market. That’s when they introduced Taobao (淘宝网), which is now one of the world’s top 10 most visited websites according to Alexa

To get our weekly newsletter, you can subscribe for free at www.GetCoInvent.com.

Introducing CoInvent Startup Summit

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CSS

One of the benefits about going national with CoInvent is the fact that now we can make things more scalable and impactful. I’ve always wanted to start a national conference series which provides great and useful content and networking opportunities for startups, entrepreneurs and investors alike. I am glad that we can finally launch it today – introducing CoInvent Startup Summit.

We are launching this conference series only in New York for now. We should be able to bring it to our west coast markets in early 2015. This year’s startup summit focuses on addressing the “Software Eating The World” theme. Via multiple 20-minute talks, we are hoping to cover a variety of industries that technologies are disrupting – including fashion, social, media, education, banking, just to name a few. Each of these sessions will be structured via panels or individual talks. As the organizer, CoInvent will strive to bring only A-list speakers to this forum. We know how little time entrepreneurs have and certainly don’t want to disappoint you with mediocre content.

With this announcement, we are introducing a few speakers as well. You can check them out here. More speakers will be added in the upcoming weeks. Stay tuned. Early bird tickets are available now. We hope to see you on December 16th at this inaugural event. Feel free to contact us if you have any speaker suggestions.