The Path to Ubiquity and the Startup ego.

Introduction to Ubiquity

A few days ago, CEO of Viv, Dag Kittlaus, dropped an early demo of Viv, an intelligent assistant that is the spiritual successor to Siri. In the post-presentation Q&A sessions with Kittlaus was asked about whether they would consider to be acquired much like how Siri was acquired back in 2010 by Apple.

“.. We’re gonna follow the path that gets us to ubiquity, that’s very important to us…”

Kittlaus continues by saying

“… We’re going to stay true to whatever way we think is the right way to get to ubiquity, so we’re not going to predetermine what that path is, but we’re predetermined to finish the job…”

So, What does this mean and why did this resonate so much?

RISE 2016

It’s the end of Rise Week 2016, where I and many others all congregated to Hong Kong, all to be seen (and heard) as part of the promising and infamous rise of “the startup”.

There’s something inherently egotistical for someone to leave their current work place, all to pursue “changing the world”.

At the end of Day One, walking on the pedestrian sky bridge between Wan Chai and HKCC (Hong Kong Convention Centre), I asked one of my trusted friends and colleagues for his impressions on the conference.

“… It feels like technology is going into a niche without really understanding why. It’s very depressing.”

“… There’s so many people in technology, so many not directly related in technology. So many people in marketing, not in marketing… It feels like technology is going into a niche without really understanding why. It’s very depressing.”

This growing sense of pessimism, where does it come from?

The 1% lifestyle

I’ve started getting into GaryVee, the infamous Marketing and awesome presenter, of VaynerMedia.

“Everyone wants to live the 1% lifestyle, but no one ever wants to put in the work that’s required as a price pre-requisite for the 1%”.

Not everyone is cut out for this. It’s clear that with the numerous expat startups trying to vie for an ounce of media attention of “Hottest Hong Kong Startup”, that the level of ego involved in this industry is tantamount to someone competing in “America’s Got Startup”.

I see a lot of attendees at startup events, look at RISE conference, web summit, the number of startup talks, co-working space at your local city etc, it’s bordering to a point of a overflowing cauldron cesspit.

Everyone is chasing this dream of wanting to make it… but the number of people attending these events just indicates that a majority of these people desire the fruits but not invest in the work that’s required to sow the seeds.

Advice is just Advice

… but people just want to replicate success

It’s said that if you want to learn anything new, you should surround yourself with experts in a specific domain.

Want to be a programmer? Get yourself some programmer friends!

But why do I want to call bullshit on that?

Having a programmer friend doesn’t make you a great programmer.
Programming more makes you a better programmer.
Programming smart makes you a smart programmer.

Likewise, having friends who are entrepreneurs won’t make you a great entrepreneur… especially if you aren’t willing to accept the amount of work that’s required to become successful.

In a similar paradigm, why is it when parents try to bestow their wisdom to their children, that the children don’t learn?

It’s human nature to suck at learning, especially when we’re “told” to do something.

So why do you suck? (and why it’s ok)

Startups are addicted to jargon

There’s a fantastic article on Quartz Media, about how internet startups are addicted to jargon (by Josh Horwitz).

Startups are addicted to jargon because they have been sold on the idea of the elevator pitch. hype words like, platform, social media, mobile, local; marketing fluff to increase the size of their self importance.

“…In an effort to either sound smart and attract investors, or to simply dress up an otherwise boring product, startups that rely too much on jargon end up alienating the users they want to attract.”

The Fallacy of the Elevator Pitch

When asking startups about about what they do, inevitably, the infamous elevator pitch.

What is the elevator pitch?

Imagine yourself, a budding business owner with a product that is the life blood of your dreams. Just getting into the elevator is none other than the your dream investor, the epitome of your entrepreneurial idol… like Steve Jobs, Elon Musk. Now as the door closing, you’re sweating, your heart is racing. You notice, you have about 30 seconds from the Nth floor down to the Ground Level.

It’s your only chance to summarise your business so they can take notice and remember you.

but as I get older, (which feels like a cliché of how young dreams die), I’ve started to notice that I observe things with a high degree of scepticism.

Does the elevator pitch theory hold true?

The problem with this type of thinking, is primarily, the fallacy of the startup ego. The business owner must not hold onto their ego, because the assumption is that the individual has greater importance than the market.

The Startup Ego

I feel that due to the ego involved, a lot of startup co-founders don’t actually understand or even able to communicate WHO they are, or what their product does.

It all comes to EGO. Everyone has too big an ego to honestly communicate well, to communicate simply.

If you can’t tell your aging grandfather what you do, then you’ve failed at explaining what you do.

So why is the startup ego born?

Why do circumstances make people start their own business

A lot of business owners are fed up with their current work, mainly due to being disillusioned from their imbalanced work/life ratio. (more related to dissatisfying work).

People talk about passion, because, work should not feel like work.

However, when people get into the situation of feeling dissatisfied with their current situation, they tend to look outwards.

They look at the end result of all these tech companies, all these companies that got paid for apps, games, platforms etc, and they all want to replicate that.

But common startup wisdom tells them they need to find a niche…

So they steer their product down a niche without really understanding why.Sound familiar?

Jumping off a cliff vs. having a parachute

The other day, I’m at the Hive co-working space listening to co-founders talk about their transition from Finance into Technology, and there’s a common comparison of how co-founders are “throwing their career away”, as if they’re jumping off a cliff.

If jumping off a cliff is the state of starting a business, then walking along up a mountain pass is tantamount to cli,ping a corporate ladder.

But what if you had a parachute when you jumped?

Why is it that no one ever talks about gliding off the mountain pass? or taking shortcuts through the terrain?

I feel that “jumping off a cliff” is predicated on an idea that is taught through parental ideals, of how every parent wants their child to be safe, not for their child to be successful. — (paraphrasing Ramit Sethi).

Risk is scary, work is not

When talking at the Hive, Shan Han (Seed Alpha) had a great presentation on what he learned through starting a business in his transition from finance to technology.

Due to the nature of ego, most people have this expectation that their idea will be stolen, and it’s all predicated on the notion of protecting their ego.

However, the common notion of “Execution > idea” is devoid of ego.

“Risk is scary — work is not”.

Contain risks

In the sphere of traditional software development, mitigating your risks is usually overlooked, but having a short development life cycle can only minimise the capital risk for a product to survive.

Since most people don’t really have the introspection required to truly understand their own individual passion compared to the actual problem that the startup is trying to solve… therein lies the disconnect between a startup co-founder and the data from what market is trying to convey.

How does a startup maintain the path towards ubiquity?

Getting towards ubiquity

A lot of startups are eventually acquired by larger companies, with more capital and entrepreneurial clout, but why do they get smaller companies get acquired?

Normally when startups are acquired, the owners believe that, being apart of a bigger brand, a bigger eco-sphere will somehow drive them closer towards ubiquity.

But looking at historical performance of acquired companies, this is normally not the case.

Bungie

Bungie is a games company that developed many franchise games, such as (my childhood favourite) Myth, Halo and most recently, Destiny. Doing a bit of research, Bungie was acquired by Microsoft in June 19, 2000, when Halo was still being developed. Why was Bungie acquired by Microsoft?

Reading the following source, [link], “just follow the money” is a prominent theme for investigating at the underlying reasons.

Originally, showcased in July 1999, at Macworld Conference & Expo, Halo was intended to be a real-time strategy game for desktop operating systems, but later changed to a third-person action game.

Given that the dot-com bubble was during the period 1995–2000, with the NASDAQ stock market peaking in March 2000 at 5,132.52. The NASDAQ then proceeded to move down to the 3000 range to June 2000, almost losing 40% from the period high.

Due to the exuberant nature of dot-com companies, the market was becoming wary of the profitability and strength of digital companies due to their lax spending habits, especially considering how many companies were going bankrupt (or were participants to accounting scandals).

As market sentiment became more and more predominantly negative, it would be sufficient to suggest that gaining extra investment for Bungie, especially before their initial release of Halo would have been a difficult task. If Bungie was in financial difficulty in 2000, it would’ve made sense to have partnered with a large games distributor/publisher, and Bungie even took a stab at working with a large publisher at the time (Take2) [link].

However, it turns out that the partnership didn’t work out.

In 1999–2000, there were four companies that would have caused a lot of hype within the “console war” rumour mill, with the top three; Microsoft (Xbox), Sony (PS2), and Nintendo (Gamecube). I wouldn’t consider Sega (Dreamcast) as a major player at the time since it lacked the physical hardware capabilities that lagged behind the other competitors.

As according to the bungie.net link, Halo couldn’t even be run on PS2. They did however, have a partnership deal with Activision, but it was the lure of working on a new console that drew then into working with Microsoft.

Given that Microsoft had already a lot of capital resources into their games system it would’ve been hard not to accept, especially given market circumstances.

How post-2000 software companies reach ubiquity

Slack, Uber, Github; all large companies with incredible capitalisation, enough to cope with market expansion and to weather oncoming storms within ever changing market conditions.

The amount of capital required to fund a startup for development is a usually within a set range, so, what other costs are required?

Community Building and Marketing are fundamentals to growing a business — looking at the three respective companies, you can determine that building a community of evangelists as well as growing a community following within the developer community.