Got it. What's Next?
It’s that time of the year again – almost the beginning of school.
Once again, I’ll be teaching the Entrepreneurial Marketing Class, MKTG 555, at the UW Foster School of Business. While I’m switching up the curriculum a good deal, I’m still incorporating hands on work for students.
If you work with a start-up and have an interesting problem for an MBA student to solve, or just want to have your company profiled, let me know. I’d love to have your company involved.
Everyone has different ways to enjoy time visiting a foreign city. Some people love trying restaurants. Some like museums and sightseeing. I like going to cool companies I have heard about and talking with the people who work there.
I think 3D Printing is one of the next big things and will eventually have a huge effect on the global supply chain and how we produce and purchase everyday materials. Sure, it’s still in its infancy today, but the potential opportunities are limitless.
So when I was in New York and found out an old colleague of mine worked at Makerbot, a leader in 3D printing, it was like someone else hearing they could get a private tour of the Louvre.
I was under NDA when I was there, but I think I’m allowed to say that there are now more than 600 Makerbot employees (and they’re hiring a ton more.)
I think I’m also allowed to say that people are doing more than just printing little toys. People are designing and printing their own iPhone cases at home, theatre companies are printing custom masks, architects are printing full scale models and industries across the board are coming up with their own ideas.
So if you are a doubter in the technology, I’d ask you think about 3D printing the way people looked at cell phones in 1980. Back then it may have been big, slow and only apply to a few people. But look at how the world has changed now that everyone in the world can have a mobile broadcasting and computing device in their pocket.
Thanks for the tour of the office. Lots of cool stuff is coming from them soon.
There’s a little company based in New Jersey called PortfolioGen. Started by a teacher and a Vice-Principal, its mission is simple – To make it easier for teachers looking for jobs to find employment with schools who need their skills and expertise.
Traditionally, teachers have had to lug around an offline portfolio when they go interview. Teachers don’t always have the web expertise of a marketer, so they don’t all know how to build a blog or social presence. Plus, they may not want to be easily found by students and parents. PortfolioGen is a safe and secure place for teachers to create an online presence, upload their portfolio and lesson plans, and one day, communicate with schools who are hiring.
The site is still in in infancy, but does have more than 14,000 teachers on board. If you’re a teacher or administrator, we’d love to get your feedback and insight. You can help the founders shape the site into something that is tailor made for teachers. Just email me for info. Thanks.
No, the title isn’t a typo. I think I think this. I need to do more research, but maybe someone can enlighten me.
All over Wallingford, I see political lawn signs for candidate Jess Spear and her tagline of something like, “We Need Rent Control.” I did a little research on her web site to learn more. Other than finding out she’s a socialist who got arrested for protesting the transportation of oil from Seattle to other distribution centers via train, I didn’t see too much detail on her call for Rent Control.
So here’s a business perspective on why I think Rent Control is probably a really bad idea.
1) I don’t see anything in her proposal that says Property Taxes can never be raised again, or that any increase in the appreciation of property value won’t cause building owners to pay more in taxes. You see, if the property owners see an increase in their taxes, but can’t raise revenue, then they won’t have any way to stop themselves from losing money. Since real estate is a long term game, if you make the long term riskier without any chance of increased profit, there’s no incentive to get involved. You’d simply build somewhere else.
2) So, if people don’t have financial incentive to build apartments here, then they won’t. So that will cause a lack of supply. In normal economic theory, this lack of supply would create a rise in prices that normalizes everything. But since we’ll have frozen rents, we won’t be able to correct the curve. Thus, people with these scarce resources (apartments) won’t have incentive to ever give them up. They’ll now inhabit places that they shouldn’t be able to afford.
3) Meanwhile, companies like Amazon, Microsoft, Facebook, Google, etc… who want to hire people who could afford these apartments, will now have a harder time bringing in out-of-staters since they won’t have anyplace to live.
4) Now we’ll have driven away the people who want to build new buildings AND the people who want to move here and take good paying jobs. Companies have obligations to shareholders, not cities. So it’s in their best interest to leave Seattle and move their offices to places where employees can actually live.
5) So this will mean we’ll have fewer good paying jobs, which means a less robust economy. As companies leave, the people who have the good paying jobs will leave with their companies to these new locations.
6) But here’s the bright side. With all the high paid employees leaving town, property values will fall. Demand and supply will come back into equilibrium. Rents will be much lower since the only people still around will be those making lower wages. (However, anyone who had a job supporting one of these companies, such as waiters, baristas, bartenders, janitors, security guards, parking attendants, delivery people or construction workers will have lost their jobs as well. So we’ll still need to figure out how they will be able to afford these new lower rents.) But the rent controls will seem kind of silly since those people with apartments to rent are fighting for the people who are still here.
Anyway, that’s what I think my MBA classes in economics and my exposure to the real world tell me. But maybe I’m missing something. If I am, let me know what it is. Otherwise, I’m curious why Ms. Spear is using this as her main Marketing message.
So it’s been a while, but here’s a new and ridiculous idea that might not be so ridiculous.
1) The problems with trying to build a profitable business delivering food or items with same day service (such as Eat 24), are the extreme set up costs to buy a fleet of vehicles, the complexity of hiring drivers who know the area, and the ability to launch branches in every key neighborhood.
2) The U.S. Postal Service is losing tons of money every year. But they have a fleet of delivery vehicles that go unused every evening, drivers who know the area and an existing branch in every neighborhood.
It seems to me that a forward thinking postal service with a strong CTO could figure out a way to deliver mail during the morning, and same day local deliveries in the afternoon and evenings.
Would love to hear why this couldn’t work.
Here’s something about MLS I don’t quite understand. DeAndre Yedlin could be headed to Anderlecht of the Belgian League. A friend of mine who knows a ton about soccer asked this series of questions:
Is this a big step up for Yedlin? I’m sure he’d get a raise, but I’m sure he could get a raise in MLS too. But in terms of advancing his career, does it make sense to go to a second tier (or third, or fourth?) Europe league? Or should he try to get a decent MLS salary after this year, and wait until England calls And what would the Sounders get out of this? Do they get any of the transfer fee? Do they get to set the transfer fee? Are we just out of luck? And we’re full on designated players too, right? So even if we got a ton of cash, we can’t really use it, right?
Here’s what I think I know. Please correct me if you know better.
1) Whether or not the play in Belgium is better than the MLS, there’s the perception in Europe that the play in the Dutch, Turkish, Norwegian, Belgian and Portuguese leagues is better than the MLS.
2) It’s easier for a Premier League, Spanish League, German League, Italian League or French League scout to catch a game in Belgium than Seattle.
3) The top teams in all the 2nd tier Europe Leagues at least get to compete in some round of the Champions League. Anderlecht won the Belgian First Division in 2013-2014, and are one of 22 teams to have already qualified for the Final 32 of the Champions League. That’s nice exposure he wouldn’t get here.
4) The MLS technically owns all the contracts of all the players. Essentially, the MLS is a giant talent agency that hosts matches in which to show off the talent they’ve recruited. Part of their revenue model is to find cheap players and develop them into players that other teams want to buy. They need the old guys to drive fans, but the real money is buying young guys low and selling high. It’s another reason the league wants parity and would rather have all the best players split amongst the teams to get playing time rather than having some great players sitting on the Sounders bench behind Dempsey and Martins for 34 games
5) There’s some sort of revenue split between the MLS and the team who scouts and signs the player. Not sure what it is.
6) MLS sets the transfer fee. I believe the team has some input based on whether they think the team and league would generate more revenue if they held the player another year.
7) Sounders would get some cash, but all it would do is help the ownership group. We can’t reinvest it into a higher salary cap.
Bottom line, the more Yedlins the league develops, the more revenue the league makes, the more revenue the teams split, the more designated players the teams can afford to have on each roster, the higher salary cap each team can have, and the more talent we can recruit to the league, which makes it easier to get the next Yedlin to play here, etc…
Let me know if you have more insight.
This was the best 22:00 of YouTube video that I’ve seen in a long time.
The speaker is Scott Galloway, who owns a think tank called L2 and is also a marketing professor at NYU Stern. He quickly explains who is winning and losing in everything from social media and retail to brands and world economies. Really interesting stuff.
There was more Polo than Prada. More Ralph than Lauren. And Levi’s outnumbered Louboutin’s about 5 to 1. But there was enough revelry, camaraderie and fun at Geekwire’s “Oscars of Seattle Startups” last night at EMP that you expected Ellen to organize a group selfie.
You can get the full results of the 13 Geek Awards over at Geekwire.com. But maybe more importantly than the awards themselves is the annual chance to catch up with what every startup in town is up to.
The startup world is a fluid one. Some people who were 100% confident in one project last year have a new passion this year. And some folks working out of their garage a year ago now have a staff of 26. But thanks to Geekwire, we get this annual opportunity to check in with one another.
It’s hard to know where this community would be without Geekwire’s involvement the last few years. Would the Seattle Times and Puget Sound Business Journal have been able to whip 800 entrepreneurial and tech enthusiasts into a kind of extended family who cooperate more than compete with each other? Would we all know the brand names of a few companies poised to be the next Zulily? I think not.
And in an industry still made up of more men than women, it was fantastic to see Julie Sandler and Jane Park given two of the top individual awards – for Geek of the Year and CEO of the Year respectively. In addition to her day job at Madrona, Julie has pushed tirelessly to encourage more young girls to pursue tech careers. And Jane is running one of the fastest growing non-tech businesses in the region.
I don’t think any more people could fit into EMP, and I don’t know how long you’d have to make the event in order to chat with everyone you know there. But it’s nice that in an environment that delivers more struggles than solutions, you know there’s a community rooting for each other. And that’s really what the Geekwire Awards are all about – a place to recognize the ones who made it, and be inspired to follow them on stage next year.
From the entrepreneur’s perspective, more access to capital is better than less. We have a current ecosystem that involves Angels and VC’s, but there are many reasons why we should make it easier for people to make informed decisions about investing in new ventures.
There’s a hearing in the Washington senate on this Tuesday, 2/25. Here’s a good link to learn more: http://lunarmobiscuit.com/washington-state-jobs-act/
“This law will allow any Washington State company to raise up to $1,000,000 per year from Washington State residents. Any resident will be able to invest at least $2,000, with that amount rising to 5% or 10% of a resident’s income or net worth. No longer will entrepreneurs be limited to raising money from “accredited” investors.”
Facebook just agreed to buy WhatsApp for $16 Billion. That’s one billion, this many times:
Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion Billion
When you add the other Billion Billion Billion for current What’s App employees, it comes to $19 Billion.
Just for fun, let’s look back at some previous tech acquisitions you may have remembered:
For one thing, it’s fun to look at what deals happened right before bubbles. It’s also fun to see that some of these deals look like bargains now, while some were just busts.
So give or take a billion or so, Google ended up with Nest, Waze, Wildfire and Motorola Mobility for the same price Facebook got Instagram and WhatsApp. Time will tell where the money was better spent.
Another way to analyze the deal is on a cost per user basis. From what I have read, WhatsApp has 450 Million Monthly Active Users (MAU). So at $19 Billion, that’s roughly $42 per user. Obviously Facebook thinks the lifetime value of each user is more than $42, which certainly seems reasonable. So from that angle, disregarding all other benefits of the deal (synergies, defensive play, talent, etc…) it could make sense.
So what about Snapchat? We all scoffed when Snapchat turned down $3 Billion from Facebook, wondering how they could think they were 3x as valuable as Instagram. Well, I can’t tell what this means for them. Certainly they are worth more than 16% of WhatsApp, aren’t they? Or is there enough overlap between WhatsApp and Snapchat users that they just saw their entire market value dry up? Again, only time will tell.
But $16 Billion is a lot of money no matter what. I think we are all on bubble watch now.
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