Computing, in the beginning, was all about less. It had to be – the computers were extremely limited, therefore almost all procedures were suited for a singular task with little room for error. Up until the introduction of the GUI, there wasn’t even the idea of multiple processes; you had to finish what you were doing, and therefore for everyone’s sanity, everything was designed with the speed and efficiency of process completion in mind.
In the desktop era, it eventually became all about more. Bigger monitors, more resolution, faster processors; more, more, more. As a result, designers and engineers began to create products that were packed dense with features, stretched to the edge of the screen with functionality for every use case. Sure, there was still a need for hierarchy and an architecture to the options, but they were a secondary concern to the density – why not have it all, if the form factor allowed for it? The Microsoft Office suite is a vestige of this, while more straight killed AOL’s Instant Messenger.
Then the mobile revolution happened, and it kicked off an inexorable revolution. Just as Moore’s law dictates a reduction in size while maintaining power, the reduction of form factor dictates that products eventually get distilled back down to the basics. An great example here is Tinder, which reduces the process of finding a mate to the most basic form imaginable. Or Twitter – 140 characters, bite sized, on the go for the mobile user.
This all leads me to what my subject is, which is chat bots. While the rise of the bots isn’t anywhere close to the revolution that the desktop, Internet, social, mobile epochs have proven to be, it’s certainly something that has caught the imagination of the technology world. And before I get too long-winded, I’m going to tip my hand on them: they’ve got it all wrong.
Let’s say you want to order lunch, and like me, a decent chunk of your time is spent in Slack collaborating with your team and getting into arguments about the proper ranking of Starburst flavors. Lucky for you, Postmates has a command line integration into Slack, and it wants to remedy that ache in your belly.
@postmates tacos near 37 east 28th street, 10036
So let’s stop it there, after the very first command. If you don’t know this already, please understand that handling even that initial request requires an ENORMOUS amount of intelligent, difficult code. First, you have to build the basic language processing to even parse the request. Second, you have to have a repository of locations, in order to determine the vicinity of the request.
Third, now, you have to start making some assumptions. For example, since there’s no scalable way to query in real-time to see if a restaurant is open, Postmates would have to pull that potentially outdated information from somewhere, and then assume that if the request falls within that window, the place is open…assuming of course that since you didn’t specify a delivery window, that you want it immediately, and also assuming the request itself is formatted in a way that parser can understand. Further down the chain, it has to assume that the menu it has saved is correct. And so on, and so on.
But let’s get back to the chat interface of this. Since the interface is reduced down to a very minimal form – unlike a desktop version! – it’s naturally not going to allow for much path deviation or special requests. (Much like the software built before the desktop revolution, of course. But I’m beating it into the ground at this point.) Ask yourself: is it going to be easy to request no beans on your taco? What if you want a hard shell instead of soft? What if you want to tell them to make the steak well-done, to call when they’re downstairs, or that you don’t need a plastic knife because there’s fifteen million at your office already? It’s really no different than wanting to know if the person on Tinder profile has a college degree; the form factor in which it is presented simply doesn’t allow for an effective way to branch out to that level of detail.
To do all of that effectively, you have to overlay so many steps that it kills the very utility it had in the first place. Eventually the user is going to wonder if it’s really worth all of the effort, especially when there are other interfaces for the same task that are likely quicker and easier to use. At a certain point, it’s like tweeting from your Wii. Yeah, you can, but why? Where’s the utility relative to other options?
That’s not to say that I don’t think that chat bots will be useful for certain tasks. Far from it, actually. You just can’t however go into it trying to replicate the functionality that a more robust form factor will allow, which is why I think none have yet made a significant impact. Early mobile development suffered from this problem – trying to mobilize all of their desktop functionality – until people realized that it required a completely different level of thinking. Unfortunately for bot programmers though, a lot of the hardware that phone manufacturers eventually put into their phones to facilitate that creativity (cameras, GPS, accelerometers, etc.) are going to be impossible to integrate into a chat bot.
So going back to my initial example, what can Postmates do in this arena? Through the bot itself, probably not all that much, which is it’s a bit perplexing to see so many companies try. What it could do however, is try to figure out a way to accept a parameter-rich link that is generated from the bot. Maybe something like this:
@postmates tacos near 37 east 28th street, 10036
>Sup Nik, hungry, eh? No worries. There’s six Mexican restaurants within 0.5 miles of your address. The highest reviewed one is Dos Toros.
Now imagine that entire string is a link, that sends a string of parameters into the Postmates app or website. Voila – the discovery aspect is knocked out, and you’re already on step three or four of the process. Dos Toros is preloaded, as is your receiving address, as is the request for tacos, and now you’re on an interface more ideally suited for handling all of the branching that might occur.
But getting back to my point, right now, the people building the bots are getting it all wrong, in the same way that early mobile development was all wrong in trying to “mobilize” desktop functionality. The Apple Watch, for example, doesn’t have the form factor to do much by itself, but it certainly is an effective and streamlined interface for your phone; this is a good start. The sooner chat bot developers turn the corner and start thinking of their tools as interfaces and/or completely new paradigms, the better.
I love the Olympics. Part of it is because of the spectacle and part of it is because I’m an acute track and field nerd, but I have to say that another significant part of it is that reinforces a lot of things that I’ve come to learn about life. I know it’s trite – and certainly heavily represented in the soft-focus human interest stories conventional TV coverage is throwing at me – but I find that sports can teach a lot of lessons, particularly about understanding other people.
Here’s an example. (And before you ask, this example has nothing to do with me. It’s just an example.)
Let’s all agree that startups are incredibly difficult. They’re mostly long, lonely strokes through the pool, punctuated by periodic gasps of air. You launched your first product? Awesome! Enjoy the traffic that the buzz of newness creates, because in two weeks you’re going to feel even further behind than when you started.
So what do you do? You grind and you grind and you grind and you grind. In a way, you’re declaring war: war against free time, war against other priorities, war against personal relationships, and war against your own emotions. Take it away, Thomas Powers:
The logic of war seems to be if the belligerent can fight, he will fight. That leaders will not surrender until surrender is academic. How is a national leader to explain the sacrifice of so much for nothing?
Next time you’re watching the Olympics – or any sport, really – watch very closely when the goals are scored, when the time is up. The events are almost always zero-sum, but I tend to almost always focus on the team on the wrong end of the match. They’re disconsolate, but I think most people misunderstand the nature of that: they’re not upset about what might have been, they’re upset because they let somebody down.
(And before someone asks about individual sports, let me stop you there. No man is an island; there are coaches, parents, and fans.)
This was in full-force the other day in the Olympics, when I was – of all the things I could have been doing for that hour – watching synchronized diving. One of the divers for Brazil had badly mangled his dive; he knew it the second he hit the water. When he got out of the pool, he was on the verge of tears; not for himself, but rather for letting his teammate down. You could see it so plainly on his face, even more so when his teammate tried in vain to console him. It was compelling to watch in the most heartbreaking of ways.
Looping this back to startups, this fear of letting your team down is one of the strongest and most pure virtues of early-stage startups. When the going is tough, more often than not what keeps the team coming back is the unspoken contract they have each other. The founders and the executives that do the best job of fostering that spirit are the ones who are truly worth backing, and it’s not an accident – it’s a gift, and that’s why certain founders get backed again and again.
This connection also illustrates a critical difference between a large company and a startup. Larger companies are simply unable to foster that spirit, essentially making every team member a mercenary unit, unwilling to fight through the muck. Lots of employee loyalty these days at Groupon, right? Timely to recent news, it also illustrates one of the problems that hit Yahoo! hard, particularly in their acqui-hire phase; when you bring teams on for their talent, it is next to impossible to keep that team together if their putative leader – the dreamer who is most likely to leave and try to start something new – leaves. The connection is no longer there.
Interestingly enough, the founders who are most successful fostering that spirit – at least from my anecdotal experience – seem to all have significant experience in some high-level team sport. But that is another topic for another day.
This is probably going to be long. Just a heads up.
So if you’re here, you’re probably interested in technology or are related to me, and since the former population is much larger than the latter it’s probably fair to assume that you’re familiar with the concept of disruption. It’s certainly a buzzword in the technology sector and a rather hated one at that, but that doesn’t render it meaningless: it refers to an inevitable entropic decline, fueled equally by advances in technology and the fat, bloated intransigence of the incumbent.
You can follow the pattern of disruption across almost all sectors; Uber for taxis, AirBNB for hotels, Warby Parker for glasses. While those are all interesting cases, they’re slightly less interesting to me because I don’t work with them or think about them on a daily basis, other than perhaps the nifty pair of Ramsays I use to make sure I don’t fall down the stairs. What I do think about is media, partly as a byproduct of being a rabid consumer of content like every modern person, and partly due to sageness of Will Porteous, who I wrote about earlier as being forward-thinking enough to know immediately that my little sports analytics company wasn’t just a pile of algorithms, but rather a media company that simply served data (and derivations of) as content.
Much, of course, has been written about the disruption of the media industry. And really, you almost don’t even need it to read about it to understand it just from intuition – how do you think record labels are doing these days? How about your local newspaper? Both are prime examples of legacy industries who either didn’t grasp, didn’t care, or wildly underestimated the effect that the move to a digital world would have on their businesses. And why would they? They controlled their little fiefdom with impunity, with nary a threat in sight, for years and years and years.
Of course, with no threats and no reason to stay thin, well, those pigs got fat. And hogs get slaughtered.
(As an aside, that in and of itself isn’t really a cause for celebration, even though it tends to be held as one within the technology industry. Even if we accept the damage as collateral as industries evolve and technologies shift, there’s still a very real impact felt in all of those people who were miles away from the decision making that ended up losing their jobs. It wasn’t their fault that their management got fat, but they bore the brunt of it to a disproportionate degree and that’s not something to feel great about.)
What’s most likely unique about the media industry relative to some of the others I mentioned is that the scale is so large and technology shift is such a living thing that the disruption never really stops. You might say for example that the move to digital killed the concept of the printed magazine and the local newspaper; you’d be right. But it’s also true that the digital magazines that killed the print ones are slowly getting killed themselves, as since as the barrier to entry is asymptotic to zero, supply on the media side is essentially infinite with little replacement cost between choices. This naturally causes the value of programmatic and remnant advertising space to plummet, thereby forcing only two viable business models onto the marketplace:
Want to play the middle? You’re toast. Unless you’re commanding a massive audience, you won’t be able to generate enough ad revenue as programmatic rates plummet to keep the lights on. Even then, the goal of “commanding a massive audience” fundamentally misses the point that #1 dictates: going after quantity as a primary goal implies that you are creating content for everyone, which is another way of saying that you’re creating it for no one. Beyond that, even if you decide to eschew programmatic and go for other forms of monetization, your users will be on to you quick: native advertising is disastrous for buy-side ROI, even if you ignore the user experience issues of passing off advertising as editorial. There just aren’t that many ways to keep fooling your users to click on ads without them learning how to ignore it, hating you, or simply installing AdBlock and telling you where to stick it.
What’s interesting to me is that you’re seeing this exact same extinction happen in the TV world as well. Remember when TLC used to be The Learning Channel, and Bravo showed simulcasts of philharmonic orchestras? Those simply didn’t pull in enough viewers, which didn’t draw in enough advertising revenue, which couldn’t subsidize the continued broadcast. So what happened? It bifurcated, just like digital media. Premium services like HBO flourished, doubling-down on quality (The Sopranos, The Wire, Game Of Thrones, etc.) to create a virtuous cycle of prosperity. Niche TV channels turned incredibly broad, going to airing mass appeal content (TLC airing Honey Boo Boo, History Channel becoming all about aliens and conspiracy theories) cynically designed to drum up publicity because at least ensured their survival, brain cells and their somewhat earnest roots be damned. After all, reality TV is functionally equivalent to user-generated, low-quality content, right? Neither has the labor cost of hiring expensive writers, and therefore it’s designed specifically to be more competitive in the marketplace because it combines a much wider audience with a much lesser cost.
While I’m not around it enough nor am I of the right pay scale to consider how to fix the TV problem, I do have a couple of thoughts on how to solve the media problem on the digital side.
The first, and most important step I believe to having a sustainable media business is taking ownership of your delivery stack. No one media company is exactly like another; each one is serving different users with different styles of content, syndicated via different platforms and so on and so on. I can’t think of a wildly successful new media company that doesn’t have their own stack; in fact, it’s probably easier to think of a company like BuzzFeed (SuperPoster) or Vox/SB Nation (Chorus) as a technology company first and a media company second. They do this because they want to attack the problem their way, building the tools they need to address problems as they come up.
In the case of numberFire, we wanted an easy way to import data from our algorithms into our articles. Seems pretty simple, right? You’d be surprised. Now extend that to what a seemingly simple site like BuzzFeed has to do: it has to test multiple headlines in real-time, it has to dynamically generate a homepage based on what you’re likely to enjoy, it has to constantly monitor the content to search for signals that an article might be going viral, and so on and so on. Think any out of the box CMS can do that? Of course not. The magic of BuzzFeed isn’t just that they command such a wide audience, it’s that they make it look so much easier than it really is. Technology has a way of doing that.
(Somewhat ironically, I’m writing this right now on WordPress, which while it’s fine for a personal blog, is an awful choice for any serious media business. The fact that so many run off of WordPress VIP is borderline comical, but hey, I’m a software engineer first so perhaps that more of a reflection on me than anything else.)
The second step is to create diversified revenue streams. This one seems kind of obvious – sort of like, “Hey, have good content in the first place” – but it’s strangely overlooked. Let’s think about it another way: retail businesses are getting into the content game because it allows them to onboard people into their experience for very cheap. They’re getting people familiar with the brand by performing the digital equivalent of showing up to the town hall where everyone is congregated, walking people the front door of the store and inviting them inside. They’re moving the audience, and once they’re relatively captive, monetizing them either directly through some sale conversion, or indirectly through brand awareness.
For the media business, this means taking that exact same audience – your audience – and figuring out different ways of drawing value. The most obvious way, of course, is advertising revenue. But let’s move it beyond that. Is there something in particular that you do better than anyone else, that people might show some willingness to pay for? Build a SaaS business around that. CBInsights does this amazingly well. (So does numberFire.) What if you’ve built a strong, credible brand and developed a reputation for being a tastemaker? Put on a conference like TechCrunch. Remember all that work you did above in taking ownership of your delivery stack? Great! I bet I know a lot of people who might like to white-label that as their own.
The third step is to stay ahead, or failing that, at least stay current. In line with the first step, investing in technology to stay ahead of the trends will put you at an enormous advantage. Again, that’s obvious but you shouldn’t underestimate that power. Even if you don’t have a VC whispering in your ear about what’s coming next, it’s not all that difficult if you simply pay it some attention. You would have known to build with mobile in mind a few years ago, you would have known to consider social as a key distribution strategy years before that. You would already be distributing via AMP and in cards and be thinking about what the eventual move to VR might look like. Proactive is infinitely better than reactive, even if the negative ROI in the short-term can seem untenable.
It’s worth saying so far as a conclusion: none of this is easy. If it were, you wouldn’t see so many dead companies on the road. The scary part is that it’s most likely going to get worse before it gets better, since other than a few instance that I noted, very few traditional media companies have taken these steps in advance and thus, they’re trying to play catch up while simultaneously having their hands tied by the same entropy and poor management that got them in the mess in the first place.
What I suppose I’m ultimately saying is that it’s ugly out there, and I think that’s going to get even more ugly soon. Transformative changes in an industry – particularly those forced by adoption of new technologies – rarely happen without some serious carnage. Part of that story is the root of what makes following technology compelling, while another part of that story is unfortunately also the root of a lot of social unrest regarding jobs, the economy, and the future.
Does this mean if I were an investor that I’d forgo any investment in media? Probably not. It’s often said that a slow down in the market doesn’t really affect highly investable companies, but instead it simply raises the bar to a point where the questionable ones have a harder time. People still need to be educated and entertained, to be informed and to find community, to lose themselves in music and in writing. The market is there, but only if the new entrants think of themselves as technology companies first, and media companies second.
Like many people my age, I have a special place in my heart for Yahoo!, so much so that I moved across the country to work there shortly after graduating from CMU in 2005. It was a brand on a downward trend even then, but I knew that they were attempting to take a cue from Apple in the form of doubling down on talented visual and interaction designers. I also knew that despite the all of the difficulty they were facing as a brand, they still commanded a large audience and thus maybe it was some young, hungry blood was exactly what they needed.
While the design half of my theory absolutely came true, the rest didn’t. The company moved way too slowly for me to consider staying relative to other opportunities (note to young software engineers: the startup game is very much about the proper management of opportunity cost) and the inability for them to make any real development in regards to obvious market trends (mobile, social, etc.) showed very clearly and very quickly to me that their leadership was inept. I quit in 2007, and most of the talented designers I worked with quit sometime shortly thereafter.
Fast forward to 2015, and the story is the same: Yahoo! has missed opportunity after opportunity, failing to capitalize on obvious trends. Marissa Mayer, who I was extremely bullish about when she was hired, certainly appears on her way out. I have some years of experience under my belt since then and when I was reading about Mayer’s tribulations, something rather obvious hit me:
When employees quit, they’re recommending that the CEO be fired. They’re saying (in their actions, of course) that they don’t trust leadership, that they don’t believe in the direction of the company, and that the opportunity upside is higher somewhere else because of it. People leave en masse because of bad leadership; they will run through walls and stay through tremendous difficulty because of good leadership. I’ve seen both happen up close. Even in the absence of everything else, just look at the turnover Yahoo! has had since Mayer has taken over, and look at it in comparison to their peers. That tells you all you need to know; the people who are most directly impacted by her leadership, her employees, have made their feelings loud and clear.
It’s a pretty simple concept, and I don’t really know why it never codified with me until now. I’m happy to say that no one has ever quit numberFire.
Everyone loves convenience and everyone loves efficiency: that’s why you’ve seen on-demand services that leverage the impulsivity of consumers with exact geolocation and logistics become such a large growth sector. Nothing groundbreaking there, right?
But one of the weird things that happens to a company when they start to play in this space is that you start to lose control of the experience. There has been about a million articles about Uber and the differentiation between employees and independent contractors, so while I don’t necessarily belabor that point, it’s important to note how that differentiation affects customer service and perception .
Let’s use this as an example:
I run a small Thai restaurant in the East Village called Nik’s Larb Hut. I’m on Seamless, but since my delivery staff are fully paid employees of my restaurant, I need to be intelligent about how they’re resourced and therefore, I set a relatively small delivery radius because I need to make sure they’re able to deliver at least three orders per hour by bike.
But since my larb is so good and because we lucked into a mention in an Eater article, we’re now getting a lot of requests by phone for deliveries outside of our radius. It doesn’t make economic sense for us to expand our radius, so we begin to mention to interested callers that there are a host of companies that can provide this delivery service, such as Postmates and Caviar.
This works out well for us until a rainy Saturday, where Postmates gets swamped with orders as everyone seems to be staying in for the night. We get the food into the hands of the couriers without much issue – we control this experience and we’re experts at it, since it’s no different than having a busy night inside of the restaurant – but once the couriers receive it, complications from the weather as well as the volume of requests severely delay the delivery of the food. To make matters worse, some couriers begin to double and triple concurrent deliveries, trying to make a higher return off of the demand-based surge pricing. The delays frustrate the customers as well as negatively impact the quality of the delicious larb; as such, we start to receive a plethora of complaints over the phone and eventually posted on Yelp and Foursquare.
See what happened there? Once the food left out hands, the experience left our control, even though in the mind of the consumer, it never did. Even if the Postmates courier was at fault, the blame and negative impact gets assigned the restaurant, damaging our brand.
Now, I don’t know enough specifically about Postmates to know whether or not this sort of situation can be avoided, but it’s certainly a dangerous thing for an industry like food, where things like Yelp reviews have a very tangible impact on business. Uber can say all they want about their drivers aren’t employees, but the more news articles there are about drivers harassing passengers and/or driving unsafely, the worse it’s going to be – and there’s no effective way of managing it.
The biggest lesson here for the zero CEOs and/or startup people who are reading my blog is that it’s very critical to understand the full gamut of experience from creation to delivery, and recognize that you ultimately are responsible for anything with your name on it, even if it gets handed off.
Now that the sale of numberFire has been in the books for a few months and the dust has settled a little bit, I’ve taken the time to reach back out to a lot of the people who were along for the ride. While I’m thrilled that everyone from the team is alongside me as we continue to develop our IP within FanDuel, I also view a lot of our early investors as members of “the team” and it’s important to me to maintain those connections and friendships.
The first one who really had our back in a meaningful way – and I don’t just mean financially, but I’d be lying if I said that wasn’t a part of it – is Will Porteous of RRE Ventures, whom I met up with last week. Will’s a great guy, and every time we get down to chatting, I come away energized with a lot of good insights – something I find to be incredibly valuable in a friend. Will was our first investor, the lead hammer in our seed investor syndicate, and a constant source of encouragement and helpful feedback, both precisely delivered at the time in which each was respectively necessary. We were lucky to have him.
(We also have an unofficial agreement to contribute to our respective blogs more. Feel free to bug him if he’s not holding up his end of the deal.)
Beyond just catching up, we got to chatting about deal flow and how someone like him, as an active investor at one of the city’s more recognized blue-chip firms, makes immediate sense of the chaos.
One maxim he shared is how he profiles CEOs of companies. Some of them are driven to be right, which is to say that above all, their passion and what they define as “success” relates to their ability to build the superior product, have the best insight, change the industry, and so on. Other people are driven to be rich, which is, well, exactly what that implies – what they define as “success” relates is purely financial and centered on personal wealth creation.
Ideally, you’d want a CEO who is an equal mix of both; someone who believes in building the best product and the fundamental quality of it, but also has a mercenary approach backed by solid understanding of business fundamentals. Too much on the former side and you’ve got an idealist who may miss the market with perfectionist tendencies and lack of proper focus; too much on the latter side and you’ve got a crappy product and a leader with misplaced values and potentially user-abusive goals.
(In case you’re wondering where I fall, I’m much more on the former side. While obviously anything worth doing is worth doing for financial gain, particularly in our industry, I started numberFire because I really and truly cared about how bad sports media was and frankly still is. It was and is something of an obsession, perhaps the only thing I love enough to start a business around. Potentially getting rich doing something I don’t care about doesn’t interest me in the slightest, as there’s nothing more valuable to me than working on cool shit.)
Anyway, this discussion got me thinking about something else – how would I thin-slice this sort of thing if I were a VC?
Because I haven’t seen enough companies or talked to enough founders to be able to immediately discern some of the subtler things that I’m sure Will is able to pick up on, the easiest solution would probably be to only accept meetings in industry areas in which I know well. I’d likely to be able to tell within thirty seconds if an idea is legit in the media, sports, or data sectors.
But that’s a very small portion of the overall market; what should I do about the rest? I hadn’t given it much thought until I read this fantastic interview of the Fat Jew, the comedian/wine salesman/provocateur who you may recall was embroiled in a very sticky stealing vs. curation debate a few months back. The article digs into the business of being a social media celebrity, with him adding some very interesting thoughts.
The Fat Jew, on marketing:
“Most people with a large social media following will hold up a can of soda, take a picture, put it out, boom,” he says. “You’ve fulfilled your contractual obligations. But kids can spot when they’re being targeted from a mile away. They’re highly averse to it. And that’s not what we do. Brands approach me: ‘We want to get nuts and reach millennials!’ They love buzzwords. ‘We want to get in the Fat Jew business and go nuts!’ So a brand like Craftsman Tools says, ‘We’d like to do something different.’ I say, ‘OK. Superbowl Sunday. Build me with Craftsman Tools a giant bowl filled with chilli. I’ll sit in it and watch the game and I’ll have people sprinkle onions and cheese on me.’”
On the industry changing:
“Here’s the deal. I’m the future. All the real adults who are reading this book may not want to accept it, but I’m telling you, it’s the truth. Yes, most people over 50 don’t understand what I do for a living or take me seriously, but does that really matter? They are all going to be retired or dead soon, and they won’t be able to say shit about the way the world is run.”
My first response to his opinion is almost revulsion; how can someone who thinks that way resonate with audiences? But then, suddenly, I get it – it’s not about me. It’s really about the people who are responding to him, that love his viewpoint and approach and can spot corporate marketing talking at them from a mile way, making little to no effort to truly reach them.
So if I don’t get this at all – but people clearly do, and the market appears to be accelerating away from me – maybe it’s equally important for me to take meetings in industry sectors I know very little about. Maybe it’s important for me to take meetings in sectors that I don’t get, that I strongly dislike, perhaps even that I hate. There’s huge value in ignorance in this case, because you can go into a meeting and easily have your mind changed and your assumptions challenged.
Some of the best, most amazing ideas probably sound ridiculous up front, so it’s a massive disservice to not listen solely on the basis of not getting it or disliking the industry. That strong opinion – even if it’s negative – is where it needs to start.
Most people in the startup world tend to share their own unique and incomprehensible dialect of English. Anyone who has ever worked with me knows my unique vocabulary, the words and phrases I tend to repeat over and over again as if I hold the patent to them. “Non-trivial” certainly sticks out as one. “Behoove” is another.
So is “atomic”, and it’s one I’ve been using (and thinking about!) quite a bit.
For contextual purposes, I’m using atomic as a broad adjective to mean a smaller, leaner, more easily digestible version of something larger, just as an atom would be to molecule. I doubt you’ll find that definition in any dictionary, and it’s likely without the context, no one would understand what I’m talking about. It does indeed however describe an inevitability in the technology world, and one that if properly understood, can lead you to some real product breakthroughs.
Let’s take dating as an example.
Version 1.0 of using the Internet to find the partner of your dreams involved a long series of questionnaires, detailing every interest and physical trait in order to give the most complete picture possible. This was an entirely desktop experience, and the amount of information collected generally followed the form factor of the desktop and the input device of the keyboard.
Version 2.0 reduced it down a little as we entered the social era, allowing people to connect their already constructed social profiles, bringing their photos, social graph, and their ontological interests with them. The idea of meeting people on the Internet was more commonly accepted by this time, so we saw more personality beyond the mere listing of traits: screen names, quizzes designed to be shared, badges, and so on. A lot of the extraneous fat was stripped away, making it a more nimble, fun experience.
I’d say we’re now at Version 3.0 of the same concept, which is what I would consider to currently be the atomic version of the concept of dating – the smallest derivation of the original idea. We’re now almost fully mobile, and the form factor dictates that the smallest amount of information necessary to make a decision is all you need. Tinder is the best example of this: it’s basically just a photo.
Take a second and think about why the experience narrowed the way that it did. We all agree that finding someone to spend time with is one of the truly global human needs. For the purposes of finding love, what’s likely the single most important thing? If we’re being honest, it’s physical attraction. Tinder knows that, which is why they’ve removed all of the extraneous steps from the equation. It’s as atomic as it gets.
Here’s another example: self-expression has gone from personal web pages to blogs to Tumblr to Twitter. Just like with dating, each new version took the same common, basic human need (“I have opinions and I want to share them!”) and figured out a way to make it simpler, to reduce it down to the atomic level. The reason why Tumblr works is because they realize that pictures really are worth 1,000 words…and they also take exponentially less time to share.
Where this concept gets really powerful – at least from my side of the table as a serial entrepreneur and as restless of a technologist as there could ever be – is trying to figure out where the next reduction might be. Is there a disruptive technology on the horizon that might brute force a reduction across multiple sectors, like the dawning of the social and then mobile eras? Is there a legacy industry or human need that has resisted it so far?
Healthcare is interesting. Education is too. Government, most definitely. Maybe you have some that you think are even more interesting than those three. Even better, maybe you’re already working on it. I hope so, because it’s as common of a success story as you’ll find in the startup world.
I’m currently in Santa Monica for some work travel, which has given me some unique and valuable time to hop out of my daily routine. I’ve been to LA a few times for various reasons but this is my first time in Santa Monica, and I’m just blown away at nice the waterfront is, to the extent that I’ve found myself each day excusing myself to take a walk along the beach just to take it all in.
On my walk today, I was listening to Pandora, mostly because I’m at the age where I can no longer reasonably keep up with modern music and thus I’m beginning to exhaust the music I’m already familiar with. I was in an upbeat mood, so I chose the 1980s as the guide, letting Pandora do the rest as I upvoted and downvoted.
Three or four songs in: Madonna, “Dress You Up”.
Now, I’m not a Madonna fan, insofar as I don’t see her as any different than nearly any other artist of that period, apart from an acknowledgement of her success and unique brashness in achieving it. I’m not an expert in her music by any stretch of the imagination. As I listened to the song – and it’s actually quite good, in that 1980s neon sort of way – I noticed several obvious things.
First, the percussion in the song is full of syncopated hand claps on the off-beat, a signature drum pattern popularized by then-superstar Prince. It is literally all over his music at the time. I was amazed I hadn’t noticed it earlier.
Second, the countermelody to the synthesizer is a funky rhythm guitar line very similar in style to the one in the chorus and bridge of Michael Jackson’s “Billie Jean”. It’s a line melodic enough to be a hook on it’s own, but played against the synthesizer and mechanical drum beat, it works even more effectively.
This pattern of “inspiration” follows throughout the song: background vocals straight out of any 1960s Motown hit, a guitar solo straight of out any 1970s-era FM radio rock tune, and a basic Cm-Bf-G7 chord structure, an extremely common progression in pop music.
This is not to say that Madonna or Nile Rodgers of Chic (who actually wrote the music and produced the song) are thieves. If anything, they show a very fundamental understanding of the etymology of success. What they did in collaging together things that worked is structurally no different than a successful startup that capitalizes on new markets with an X of Y product strategy, or one that simply looks historically at the traits of successful companies and emulates them.
We certainly took that approach at numberFire. We modeled our initial seed pitch deck after Next Big Sound. We modeled our initial front-end engineering architecture off of Hunch. We algorithmically turned structured data into editorial content like Automated Insights, leveraged user-generated content like Bleacher Report, and bolstered a consumer-facing media site with a high LTV subscription business model like ESPN Insider.
There’s a common maxim that good artists copy, and that great artists steal. While obviously the maxim is meant to be flippant and provocative, it glosses over what is really the key message: stealing is a fruitless endeavor if you don’t have the capacity to understand what is valuable to steal. You have to be able to internally curate good ideas from bad.
Nile Rodgers clearly not only knew what elements to build from, but he intuitively knew how they would work together in concert and not as a disparate soup of independent elements. I think a lot of companies, particularly when they’re battling uphill, either don’t have that intuition or simply override it in a panic to figure things out as quickly as possible. That is a certain spiral to failure.
Are there companies (and musicians!) who ignore everything, and completely do it themselves, free of any inspiration, be it organic or curated? Sure. But they’re far fewer than you would think, and I certainly don’t hold it against any one who has the good sense to be a careful study of the past in order to create a more promising future.
Everyone hates flying, simply because it’s a miserable experience in just about every way. Everything in the flying ecosystem is mismanaged and seemingly optimized for customer dissatisfaction, from opaque/cartel pricing to inefficient security to disorganized boarding. It is truly unique in the world of business so far as it’s intersection of importance and awfulness.
Of course, all of these problems and frustrations are known to everyone, but what’s the real alternative? Without competing options, industries stagnate and ignore their customer. Just as the taxi commission about that.
But you know all of this already; you probably didn’t click on this post to hear me bitch about flying. No, I actually wanted talk about something else, and that’s lines. And no, not lines in the startup sense or lines in a slang sense, but literal lines. Queues.
While I was frustratedly waiting to board thanks to Delta’s frankly bizarre and disorganized way of doing it, I noticed that for the most part, everyone waiting for the flight queued up nicely when given a structured direction. Everyone eventually sort of shrugged, and realized that they were in it together to some extent. And since the plane was there, waiting, everyone would get on and therefore another two or three minutes spent looking at a phone or impatiently tapping a foot would ultimately be forgotten – just another annoyance in an experience full of them.
It hit me that lines are the ultimate leveler – everyone waits, regardless of who they are. You might be broken up into different lines by zones at the airport or by colors at Whole Foods, but the line is the line. Everyone waits.
This made me think of something I once saw at Six Flags, where you could pay extra to literally always hop to the front of the line. The more I thought about it, the more I concluded that while that kind of upsell has significant utility for the consumer (and thus, revenue for the business), the damage it ultimately does in sum to the unsold customer isn’t really worth it. The utility derived from the subset of people who buy it is never going to even out the negative utility felt by the majority who didn’t buy it and think it’s complete bullshit that the product exists in the first place.
Not every startup is going to have an equivalent of this (and certainly any sports connection I might try to make her would be fairly belabored at best), but it’s an easy lesson: make your product equally accessible and enjoyable for everyone. No one likes to feel left out.
I also just realized that I never talked about the people who ignore the line altogether and try to cut in at the amorphous merge point, tacitly making the argument that they are too good for the line and too special to be treated equally. Unless you’re a cab driver or are in a similar situation with zero expectation of decorum, there’s a pretty clear label for you: asshole. And you’re probably enough of one to buy that upsell package from Six Flags. There’s probably a strong correlation there.
One of the biggest problems I have with a lot of data-related businesses is that they only provide half of the value that I think they should. While it is indeed valuable for a company to help you look at your information and dissect it into smaller and smaller chunks, to me it’s even more valuable for that company to provide timely recommendations based on that data.
I said it an awful lot in VC pitches, to myriad levels of success: what’s already happened will never be as interesting or valuable as what’s going to happen.
Take something like Google Analytics as an example. numberFire has been set up on Google Analytics since the day it was first put online. It can tell me what piece of content was the most successful, how long people on Android phones stay on the site, and any number of vaguely useful things. What it doesn’t tell me however is that the ideal headline length is seven words, or when an article is showing the initial signals of virality.
This is an equivalency to the frustration that I had when I founded numberFire in the first place. Far too many sports analysts were just regurgitating the information, as if all situations were apples to apples (is playing the Seahawks the same as playing the Browns? Hmm..) and broad comparisons were predictive of future events. By using machine learning and various other data mining techniques, we took wide swaths of sports data and turned it into something predictive, because having predictive knowledge on future events is a very valuable piece of information to have.
I would love a dashboard that would tell me how many page views I can expect, just on the basis of the content matter and the headline. I would love to know when an article is about to go viral, so that I can highlight it on social media and re-order the items on my homepage to reflect that. I would love know on which channels and what times I should double my marketing efforts, suggesting keywords that are undervalued in the market, or that a user segment is being underserved based on current supply. I don’t really see why that’s not possible, given what Google Analytics, Heap, KissMetrics, and everything else in our reporting stack knows.
And what’s even more strange about it is that everyone seems to be creating companies that harness the information, creating largely fungible businesses to what is already out there – I should know, because I get about fifteen cold emails from them daily. No one is creating a business that simply ingests that information, and serves you the recommendation at the precise moment. It’s a missed opportunity.