How are you holding up?
This year keeps on giving (and it ain’t over yet), but don’t worry: here’s a fresh newsletter to keep you entertained while you socially distance yourself.
And while we’re here - share the love with a friend or colleague who’s in need of on-the-button tech-focused news with a smile! #sharingiscaring (sign up here)
A bientôt,
Rob & the Founders Intelligence Team
🗞 What's grabbed our attention this month 🗞
Brought to you by Ezra Konvitz & Hendrik Jandel
Five stars but no healthcare? – Uber and Lyft just got one step closer to actually having to follow the rules with California’s court of appeal ordering the gig economy unicorns to register their drivers, effectively ruling that they’re entitled to health care benefits and workers’ compensation. But it ain’t over till it’s over: voters will decide on 3 Nov whether gig economy workers are exempt from state law. And to persuade them, the companies are threatening the end of ‘ride-sharing’ as we know it (aka no more discount life coaching in a Prius) - will cheap transport trump human decency?
So what? Disruptive business models inherently operate in regulatory grey zones where the law can’t keep up with tech developments - hence the disruption, innit. As with many gig economy models, profitability for Uber, Lyft et al now depends on politics, but it didn’t have to be this way. If you are an innovator in a similar situation here’s a quick playbook: 1) partner with regulators early to avoid a major blow-up at scale (well done, Voi) 2) diversify your revenue so that you survive regulatory disruptions (Uber’s on it) 3) and perhaps most important - don’t exploit those you depend on and create win-win-win solutions.
An apple a day? Apple added Electronic Health Records (EHR) to iPhones in Canada and the UK, joining the US where it’s been live for 2 years and is used by hundreds of institutions. And the new Apple Watch now measures blood oxygen alongside its ECG functionality. Meanwhile, Google filed a patent for an AI powered EHR system and their pending Fitbit acquisition will help to fill those records - same same. Just to mix things up, EHR incumbent Epic integrated Microsoft Teams for virtual consultations and Amazon’s internal telemedicine service is looking at expansion.
So what? The vast and growing consumer healthcare market could make the difference between a $1trillion and a $5-10trillion market cap for Big Tech companies. Microsoft et al. have long formed partnerships with telehealth companies but they won’t be content just providing cloud services - the big new revenue frontier is in dominating the data and on-demand revolution in health (now that’s a business a move-fast-and-break-things start-up can’t crack). Where does that leave Babylon, Kry and others? They can either lobby to change data sharing regulations or get ready for acquisition.
The (almost) everything store – Amazon launched a fancy, invite-only luxury goods marketplace last month, notably going to market with only one brand (Oscar de la Renta, darling), while they quickly onboarded Roland Mouret and La Perla - but they’re missing the heavyweights, and that doesn’t look set to change. Seizing the fashion week-shaped hole left by COVID with a more ‘democratic’ Savage X Fenty launch on Prime gave fans a chance to watch Lizzo, Paris Hilton and Rihanna herself on the catwalk - and immediately click through to purchase in a brand-designed concession.
So what? LVMH, Kering et al. aren’t buying it (for now), knowing that their understanding of their HNW customers is the most valuable asset they have, and hoping their brands’ direct channels with fans can drive volume on their owned e-commerce. They’ll have no Diapers.com story here - though Amazon is finding ways to cut-through (peep their StitchFix copycat personal shopper service, adding yet another recurring revenue stream). With e-commerce just 12% of luxury sales and >90% of the audience already on Prime, the question is: will dedicated platforms trump ease of access and customer volume, virtual try-on tech and cost-effective fast delivery and returns? One thing’s certain: luxury consortiums need to get a lot better at having a single customer view across their brands before Amazon figures it out for them.
Your platform or mine? - The EU is getting tough on Big Tech, drafting rules forcing them to share data with smaller competitors, prohibiting them from using users data for their own purposes and banning preferential treatment of their own services on their platforms (crazy, right?). Google seemingly only got part of the memo: while pressing ahead with acquiring Fitbit, they’re promising not to use health data for advertising (for now) and to give third parties access to that same data. Thanks. Simultaneously, they’ll start to enforce their 30% fee on all in-app purchases on Android apps.
So what? It’s getting colder in Europe for Big Tech as the EU takes a page from its Open Banking playbook and looks to foster innovation by giving new kids around the block access to the same data that GAFA made billions from. But it’s not only politicians who are after them: Apple and Epic Games are fighting in court over fees on in-app purchases (aka the rent is too damn high). One thing is clear: it’s great for EU innovation as the dominant players need to work out new ways to stay profitable while upstarts (funded by Daniel Ek) can start to challenge them.
The politics of innovation
Have you tried to scale an innovation project but found yourself getting lost in corporate politics? Rob Haines, Partner at Founders Intelligence, has put together a useful guide on understanding different archetypes of execs and how to navigate between them. Learn more here.
We do a lot of reading…so you don’t have to:
The (not so) failing New York Times: 5 years ago, the once thriving newspaper industry found itself in an existential crisis as Silicon Valley platforms took away their advertising revenue. Today, the New York Times has more subscribers than ever and strong financials. What did they do right? They cleaned up their balance sheet, focused on their core product (journalism), invested in tech and created new digital revenue streams. In other words: they moved away from feeding the aggregators (Huffington Post, Facebook) with content in exchange for mostly unpaid traffic and became a publisher that understands how to get, engage and retain paying customers (Disney is doing a similar move). See a more detailed overview here.
Meetings, am I right? Daniel Ek, founder of Spotify, recently made news with a promise to bet €1bn of his personal wealth on European moonshot ventures. Generous, but also pretty smart - Ben Evans argues that the American monopoly on unicorns is gone. Daniel recently shared some great tips on how to run effective meetings and effective organisations that allow him to actually think during his workday, not only about the future of Spotify but also the future of the European ecosystem. Key tips: Delegate day-to-day decision making, have an open calendar that allows ad hoc tasks, and prepare meetings so that they make sense. See here for more of his wisdom.
…Speaking of Spotify (and the future of media): Matthew Ball published a fantastic essay on the future of media and the opportunity for audio (podcasts and live online concerts). Starting with a reminder of how technology shapes media by allowing for new formats (there would be no podcasts without the iPod) he goes on to evaluate some of the new audio formats - for instance, Spotify is now allowing podcasters to include any of their 40m songs, enabling anyone to create their own radio show. Glorious times for user-generated audio content ahead! Here’s the essay if you’d like to read more (sadly, there’s no audio version).
That’s all, folks. If you are still here, you clearly had a blast reading this. So please share the joy with your nearest and dearest & your remote colleagues.
PS: We’re also contributing insights to Founders News, a new personalised tech newsletter with info on your network and lots of this content too hatched out of Founders Forum - subscribe here!