Archive for August, 2006

Does long tail work?

Lee Gomes provides some data into the long tail — or rather, the lack of it.

In a critique to “The Long Tail”, Lee quotes examples such as:
- With expansion of inventory, the no-play list on Ecast has gone up from 2 to 12%. The number on Rhapsody is 22%.
- 2.7% of Amazon’s titles produce 75% revenue; 10% of Ecast songs account for 90% of the streams.
- 10% of Bloglines feeds grab 88% of subscriptions; 35% have no subscriptions at all.

There does seem to be some movement towards the tail, but apparantly the hype has overtaken reality once again.

Our own experience at venturewoods suggests that media is definitely getting more personalized and targeted. May be the more relevant question is “what are the applications for which long tail has an immediate impact”?

[also see followup on 21st Sep, 2006 here]

Redherring on Google M&A in India

Redherring has an interesting article on Google’s potental M&A plans in India.

It is interesting to contrast Google’s acquisitions from Yahoo’s. Google has tended to acquire early and for technology, not for communities. Also, Google is totally focussed on stuff that can add to their advertiser business, unlike Yahoo which is also interested in ecommerce etc.

The Laws

When Rajesh pointed out the site couchsurfing it made me think. Here is something that I cannot imagine being done without the internet. It took just a few people to build this community and bring so many people together, in such little time. In addition if you read about when it was almost destroyed by a disk crash and brough back to life by the community – it brought out the lasting nature of the creation. I thought wow, yet another example of metcalfs law.

But there is a combination of 4 laws (maybe you guys know some more) that all interact to bring about the incredible power on the internet.

Here they are:

Moore’s Law : Computing : Powers doubles every year.
Guilder’s Law : Communication : Bandwidth doubles very 9-12 months
Kryder’s Law : Storage: Capacity doubles every 24 months
Metcalf’s Law : Community: Value is proportional to N**2 where N is the number of participants

I often forget to factor in these laws when distect an idea and am then surprised by the results – that so few can achieve with so little.

It would be interesting to examine companies and ideas to see which laws are primarily responsible for their growth.

Hacking The Himalayas

Continuing on the thought-provoking post by Sanjay, I wanted to share a very interesting story of human endeavor and social entrepreneurship. The amalgamation of right ideas, right minds and right knowledge can definitely change human perspective and enlighten society.

A Silicon Valley escapist, members of the old-school computer security group called the Cult of Dead Cow have ventured with residents of the Tibetan-dominated town of Dharamsala to establish a wireless mesh network which caters the community with high-speed data and telephony services. The whole project runs on solar power, cheap hacked hardware and open source software.

The story in itself is amazing and awe-inspiring. This Xanadu called Dharamsala has already witnessed a cultural revolution of sorts. A kingdom in exile, an escapist hippie-hideout and now the witness of a technology frontier.

This hacker illuminati is also organizing AirJaldi Summit to share ideas on making this pilot a “social elephant” as Sanjay terms it :)

Make India Movement

As the “Quit India” movement demonstrated collective non violent action is a very powerful force that can introduce radical change.

” Rang de Basanti” articulated the need for radical change to “Make India” . The use of violence to achieve the goal is not something that I believe in. As the cliche goes the power of the pen is mightier than the gun.

Singapore has managed to introduce massive behavioural change but their methods may not be appropriate in a country like India.

I am working on a whitepaper to articulate some of my thoughts around using the power of the web and entrepreneurship to “Make India” . If you would like a copy of the whitepaper when it is done send me an email. I hope to limit the size of the whitepaper to a few pages.

“Make India” could be a “social blue whale” not just a “social elephant” if it energizes a nation . If you are a social entrepreneur interested in making “Make India” happen do get in touch.

Social Entrepreneurship

As some of you may know I was a Reuters Digital Vision Fellow at Stanford University and have an interest in “social entrepreneurship” . I also have an interest in ideas that start small but can become very big. I call these “elephants”. In the social area I am interested in “social elephants”.

For “not for profit companies” VC type equity and employee stock options do not work because there are no exits ( acquisition or IPO). However, “patient capital” and “outcome based bonuses” offer what look to me to be interesting ways to breed “social elephants”.

If anyone reading this has a success story where a “social elephant” is being incubated or has reached maturity I would love to hear about it.

I am working with one social entrepreneur in Delhi trying to use these concepts but it has been a rocky road so far. I am happy to share this experience with persons/ institutions who let me know why they would like to get details.

Leisure Travel

I am Sanjay’s younger brother. I have been vicariously participating in all the excitement in India through conversations with Sanjay and reading Venturewoods. Now with the acquisition of my last venture I am relishing the thought of getting actively involved. I consider it a privilege to be part of this community and look forward to getting to know you all better.

I hope to post ‘Musing’s on different areas and this one on Travel is my first.

The evolution of the Leisure Travel and Hospitality Industry is something that I would like to examine and understand and would love to hear any thoughts.

As I start looking at this world, it seems to me that there are two parts of the industry

    The first deals with building and operating the infrastructure that allows leisure travel: companies that build aircrafts, operate airlines, operate hotels, car rental services, theme parks etc

    The second deals with facilitating the use of the infrastructure – like travel agencies, ticketing services, concierge services, tour operators etc.

There are companies that bleed from one category into the other often leveraging their brands to vertically integrate. I would be interested in opinions on if these two categories are adequate or a different view.

There are innovations in each category and below is a list of a few innovations in the categories, I would love to know what else people see as innovations and which innovations are significant and which ones in one category may trigger change in the other.

Operators or Producers of Infrastructure: These are usually capital intensive businesses

    Aircaft : Smaller, cheaper and more fuel efficient: Enbraera etc and now Honda
    Airlines : Air Taxis
    Fractional Ownership: Destination Clubs , Cars , Jets

Use Facilitators

    Online Travel Agencies: Expedia, Travelocity, Orbitz, Priceline etc
    Online Travel Search: Sidestep, Kayak, Farecompare, Farecast, Paguna
    Group Travel: Triphub, Groople
    Reviews : Tripadvisor, Real Travel, 43places, wikitravel
    Specialty Tours: Olivia
    Concierge : Bluefish

Entrepreneurship top career aspiration

According to a recent HT-Cfore survey amongst youth, Entrepreneurship is the top career aspiration at 22% of respondents. Others such as Science, Engineering etc follow later.

I guess this survey did not cover people already in jobs, and that number might only be higher.

I remember fifteen years back, it used to be Engineering, Medicine, IAS, MBA.

Creative Destruction

Entrepreneurship induces destructive changes in the underlying system. This is how the famed, uncontemporary economist Joseph Schumpeter defined it. He termed it as Creative Destruction. This rebel economist was the first one to rightly predict economic ecosystems like Silicon Valley, giving a deep existential insight into the mind of the entrepreneur. A far-cry and almost anarchic view when compared to the Keynesian notions of mass-production and supply-and-demand, which were dominant and popular during those days of industrial revolution. With seminal works like Capitalism, Socialism and Democracy, he laid the foundations of entrepreneurship.

He (Schumpeter) rejected the notion of equilibrium altogether, instead arguing that the economy is in a perpetual state of dynamic disequilibrium. Entrepreneurs introduce innovations that upend the established order, he said, unleashing a “gale of creative destruction” that forces incumbents to adapt or die. This “process of industrial mutation,” he explained, “incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.” Moreover, it is precisely this process that causes economies to grow. “Stabilized capitalism,” he declared, “is a contradiction in terms [1].

For me, Schumpeter was one of the earliest avatars of the entrepreneur we see nowadays. He was non-aligned to the economic theories of those days and wanted to create an economic model whose basic catalyzers were idea and creativity. Under a heavy influence of the existentialist writers like Nietzsche, he amalgamated basic reasoning with economics. Even while reading the “acclaimed” book Blue Ocean Strategy, I could somehow see the Schumpeterian foundations of big-is-better and monopoly innovations [2].

With the passage of time, his ideas were taken seriously and people could relate to it. He’s not a perfect rendition of the entrepreneurial mindset and neither his hypothesis has an underlying mathematical logic, still he had some fascinating ideas.

1. Dead Thinkers’ Society, Meet the new economy’s oldest new economist – Business 2.0 . Cached link here.

2. Schumpeter�s Creative Destruction: A Review of the Evidence

Business Plan Archive

Just stumbled on this interesting website which can be a useful resource for entrepreneurs who want to get a taste of how some real business plans were blueprinted, formulated and implemented.

The Business Plan Archive is a joint archiving project headed by prestigious institutions like Library of Congress, the Center for History and New Media and the University of Maryland Libraries. Their aim is to preserve the golden era of entrepreneurship and creativity, the birth of the Dot Com Era, for upcoming generations.

Definitely worth a look. After a quick registration process, you can access mounds of data like business plans, executive summaries, spreadsheets, powerpoints, press releases or any other material which defines a start-up.

And yes, I am really excited to be a part of this community blog!