Today is a hot day in Melbourne 34 degrees celsius or 93.2 degrees fahrenheit. It seems though it is never too hot to retail coffee in our fair city of Melbourne. Looking for a java fix I quickstepped down to the nearest caffeine haunt in docklands. I happened upon a new outfit called Cafenatics. Their coffee and food were both good. Their outdoor air conditioning was the total bomb. I freaking loved it.
They had set up a nice water misting system in both their outdoor dining area and even inside. It was just perfectly soft so that you didn’t feel wet, just cooled down. So amazing, I tweeted about it, posted in on Foursquare and even made the effort to write this and share some pictures of it (below). A simple idea I’ve never seen before.
The thing I like just as much is that this is clearly not a new technology…. the Romans probably invented it. Proving again that innovation is an attitude and there are probably a thousand low cost ways any of us could employ tomorrow to wow people. This certainly got me talking.
The curious thing is that, their coffee is what I came for, and their mist cooling system is the story I left with.
Famed musician Billy Joel needs little introduction. I find the back story of artists and musicians full of lessons for entrepreneurs – especially during the halcyon period of the music industrial complex circa 1950-1995. But today I read some things about Billy Joel which really inspired me:
Firstly, he didn’t finish high school because he took a gig playing in a piano bar at nights to support his single mother. At the end of the year he didn’t have enough credits to graduate:
The final irony is that he now has 6 honorary doctorate degrees from famous colleges.
It seems that the #BBB podcast has been providing me with some clear blog ideas recently. Below is a comment I made in one of the podcasts in regard to the Super Awesome Micro Project – and well, projects in general costing us much more than we ever estimate.
Now I’m starting to think our human delusions on the real time and cost of embarking on activity helps us grow and expand. So when it comes to time and cost on our next project in 2014, we should probably know it’s wrong, and just do it anyway.
A bad decision is better than no decision. Yep, I’d rather get it wrong than suffer from inertia. I will point out that I’m talking here about non life threading concepts, or decisions which could lead to total financial disaster. But generally, most the of the decisions we need to make personally, in business and startups fall into neither of these categories.
The power of a bad decision is the real world feedback they provide. They allows us to cross one of the possibilities off the list. Not doing anything or procrastinating on a choice is the enemy of momentum. And momentum is game winning.
I can recall working in large companies and how often they’d research the daylight out of ideas. I’m certain they did this to avoiding making a call. Managers making sure they remove accountability from themselves… they could use research to save their ass. In this decision time they could’ve tried multiple activities, and instead choose to pontificate on the possibilities. A decision on the other hand would uncover what actually works, save money on research and opportunity cost. The final irony being the majority of these slow corporate decisions still turned out to be wrong.
So in the spirit of new beginnings for a new year – I say embrace bad decisions. Ultimately they will lead us to the right ones.
I’ve been reviewing my notepad from 2013 and thought I’d share my insights into what’s changed and the big issues from my perspective in startups, business and technology.
Technology is no longer a thing: It’s almost not worth mentioning now it is so ensconced in human life. Business, political and social activities are intertwined in technology as an organism. Having a digital strategy is a bit like having an ‘electricity strategy’ – it’s just nonsense. In fact, if any business still delineates a part of their strategy as digital, then it’s fair to say they have no strategy at all. A terrific piece of evidence for this fact is observing how the technology and business section of the WSJ and New York Times now have a massive overlap.
Social media just is: It’s becoming a bit like general chit chat between any group of friends. A way of communicating. It doesn’t have a nuance or specificity that makes it remarkable anymore. It just is. I guess it’s now just a stage in the evolution of human communication. We could regard this as evidence of its permanence.
Anonymity is the new black: You may remember in the early commercial web era – post 1993, we all had alias names and emails before we felt comfortable enough to convert to our actual human self on line. It seems now that anonymity is back. People wanting to express themselves without it impacting their college application or next job interview. It’s been said that this helped tumblr, and is a large part of Snapchats appeal. As privacy gets eroded through government activity we can expect a lot more anonymous forums to emerge as powerful web platforms. Another outcome is the potentiality for privacy to become a serious luxury going forward.
Email & text on the comeback trail: The inbox has made a comeback for me. This year I signed up to a number of email newsletters which provided a haven of curation in my areas of interest. It might also be that my email address is mine, where social media has the who owns this data issue hanging over it. I also reverted to more text / SMS activity which would’ve been the only domain for my social media a couple of years ago. I think this was facilitated by improved video and photo output of smart phones, the direct & personal nature of people we share with phone to phone. Also the up weighting of data allowances on mobile phone from carriers.
Device equilibrium: All devices are merging to a kind of functionality equilibrium. Phablet anyone? It does seem as though all tech devices can perform much the same function. Now the only differentiator is size preference and UX.
Still waiting for wearables: It feels like we are in early 2000′s phase for smart phones when it comes to wearable computing. We all know we want it, we all know it is inevitable, but no one has quite nailed the technology output yet. Google Glass is the clear front runner, but no one has launched anything yet which has captured the ‘iPhone’ this changes everything moment. Here’s hoping for 2014.
We of things: See above – insert web of things.
The geo layer: Doesn’t seem to me like it can be a point of difference for any web related startup or brand. Foursqaure and others may have missed their chance. It’s a lot like digital now and just exists as an invisible layer on all our output. A vital component to making sense in a technology world, but omnipresent simple and expected.
Long reads: The deminishing returns of news and immediate communication are helping long thoughtful analysis make a comeback. The startup Medium.com seems exciting and longer posts which consider the implications of rapid change are capturing more of my time these days.
Tech valuations & bubblenomics: Crazy company valuations continue to astound. We are absolutely in another technology bubble, this time it is a valuation bubble, rather than an investment boom. I was talking with Nic Hodges about the $3 billion+ valuation of Pinterest proposing that they are like a shopping centre of sorts – a Westfield maybe? His retort was classic. He said:
Westfield owns $20 billion worth of property. What Pinterest owns is some code.
It seems that everyone forgets that valuations must be a function of earnings, or expected future earnings. Here’s a question worth asking when it comes to the true worth of any company. What would you rather own:
Apple stock at a 14 times price earnings ratio?
Facebook at a 141 times price earnings ratio?
Do you really think Facebook will be 10 times more profitable than it is now or any time soon? Or that Snapchat with an infinity price earnings ratio (zero earnings on $3.2b valuation) will ever make serious money? There is a very big difference between usage utility and commercial value.
There’s a reason why Warren Buffet has been in the top 2 richest people in the world for the past 30 years – he knows what companies are actually worth. And there’s a reason why many famous VC’s are rich – they are selling you sausages at caviar prices. It seems the real money in technology stocks is made when the founders exit, not when investors buy it.
So – what did you guys notice in 2013?
With the recent news that Holden (General Motors Car Division in Australia) are exiting the practice of local manufacturing, there has been a lot of political commentary on the issue. Clearly it is sad for those who will need to find new employment. In light of the negative sentiment for the brand, Holden decided to run an advertising campaign to allay fears. The claim being that while they will no longer make cars in Australia, they will continue to make cars for Australia. It can be seen below:
There has been significant backlash. This is predictable conglomerate behaviour…. quick, quick, run an advertisement to make it all ok. But the truth is this is a total waste of money. It’s simple really:
The people who don’t care about the manufacturing exit, don’t need to hear it. The people who are upset about the exit, are unable to be assuaged by the campaign. It’s a zero sum game.
This is one of those occasions where no amount of advertising will change the minds of those who are disappointed, and possibly infuriate them. Sometimes the best form of marketing is knowing when to keep quiet.
As readers of my blog will know, I worked on a little side project with Raul Oaida (the tech mind who made it possible) and crowd funded it on twitter with 40 patrons from Melbourne.
A full size Lego car, with an engine made of Lego powered by air.
We just released it on youtube. We think it is pretty cool. I hope you do as well.
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You can find out more about it the entire project by clicking here
Had a few ideas in my mind for blog posts. But thought I’ll just soundbite them now and go deep later:
1. Selling Potatoes: Startup ideas are often far too clever. Often they represent what is technically possible, rather than what is technically needed. I keep coming back to the idea of selling potatoes. That is, selling something demand already exists for. If we do this, we can stop wasting resources trying to creating demand. Instead we can just do a better job connecting and serving the existential market. Buy for price X and sell for X2. I’m wondering why a ‘potato’ business is rarely considered by aspiring entrepreneurs. We ought resist the temptation to 3D print ceramic fur balls for imaginary cats.
2. Market Validation: Real market validation must be with strangers, not colleagues. If it’s an online business, then validation can’t be done in person. If it’s a physical business then validation can’t be done on line. We ought match the real world. Real market validation should involve money, and avoid surveys.
3. Size & Attitude: The bigger the company the harder it is to maintain a cool attitude. When companies go public, their DNA changes. It’s just a fact we ought accept. At this point founders don’t care, they’ve already made bank. When our favourite companies get big it is inevitable we will suffer from a little bit of startup nostalgia.
4. Business Model & Problem Solution: I often get pitched startups that have a great business model with no real human problem. Or a solution to a human problem which struggles to find a business model. Our chances of success increase dramatically when we have both. We should work hard on having both of these elements when conceiving our next startup.
5. Quiet Self Esteem: It is what we are doing when no one is actually looking that matters. The actions we take that only we will ever know about. This is what we should focus on.
6. Half Baked Ideas: These are the best ideas to play with in the short term. It means we are in the kitchen experimenting. It doesn’t mean we should try and sell these cookies at the market, but we should always throw a few new recipes in the oven.
7. What VC’s Really Invest In: Justifiable failure. They don’t aim to fail, but before they invest a dime they know they will get it wrong more than 9 times out of ten. They’ll never admit this, but they are only ever investing in what will sound like a good bet to their partners. So that when it does fail (and it will more than 90% of the time) it is justifiable to those who stumped up the money. Hence, when seeking capital all we need be is justifiably worth the risk.
A business plan is not a user manual. It’s not a map of a defined territory and it’s not a even a vision of the future. At best it is a contention of how we may be able to get things done. Because of this, we need realise it can and should be revised as soon as it is unproven. Yes, we should give it a chance, execute against the contention, but remember it is only as valuable as the results it generates. We can throw it away, draft a new one if needed.
While important, a plan must serve us. We ought not serve it.