Paul Wallbank – Brilliant Communications

Tag: investment

  • Reverse financing a manufacturing revolution

    Reverse financing a manufacturing revolution

    Nano Dimensions may not have shipped a product since it was founded in 2012 but is worth $49 million dollars and was Israel’s best performing tech stock last year reports Bloomberg Business.

    It’s not surprising that Nano Dimensions has caught the imagination of investors, the company was founded in 2012 to develop advanced 3D printed electronics, including printers for multilayer PCBs (printed circuit boards) and the nanotechnology-based inks those machines rely upon.

    Should the technology prove successful, the application of those printers in fields like rapid prototyping is immense. The company speculates their devices may even get RFID tags down to the magical one cent figure which opens may opportunities in industries like logistics and retail.

    In a GeekMe profile of the company last June, the writer even speculated Nano Dimensions could be heralding a disruption to the electronics industry similar to that the music industry faced when home users could burn their own CDs and stream music.

    While that – and the speculation that 3D printing of electronic devices will kill Chinese manufacturing – may be some way off, it isn’t hard to see the potential of this technology.

    The Israeli aspect of the Nano Dimensions story is interesting as well, with the company receiving a $1.25 million investment from the country’s office of the chief scientist after it was reverse listed onto the local stock market by taking over a moribund company.

    For countries like Australia, Canada and the United States which are likely to have many moribund small mining and energy on their stock markets in coming years, such reverse listings may be an opportunity to spark their tech sectors with fresh capital and talent.

     

    While Nano Dimensions is still very a speculative venture, the company illustrates a number of possibilities for 3D printing, electronics, the Israeli tech industry and the future of fund raising at a time when the Silicon Valley venture capital model seems to be under stress.

    Another fascinating aspect of Nano Dimensions is that it’s one of the new breed of hardware startups, a field that until recently was dismissed as ‘too hard’ by most tech investors. Overall, the Israeli businesses an interesting company to watch for many of the aspects it touches upon.

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  • Another wannabe tech unicorn begins to look sick

    Another wannabe tech unicorn begins to look sick

    Doordash, one of the myriad home delivery services the current tech bubble has spawned, is abandoning its hopes of becoming a unicorn Bloomberg reports.

    The company was seeking a valuation of a billion dollars from its latest fund raising round but in the face of disinterest from prospective investors the company has started lowering expectations.

    Even at $600 million dollars that valuation seems rich and for existing shareholders offering more equity at the same valuation this is bad news as their stake is being diluted out.

    For Doordash, the lack of investor interest is only one of their problems. Last year the company was sued by iconic Californian burger chain In ‘n Out for alleged trademark infringement and deceptive practices.

    As market leader Instacart raises prices and looks to cut costs it seems the home delivery mania is coming to an end. Doordash could well be one of the wannabe unicorns that never quite made it.

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  • Saving Twitter

    Saving Twitter

    Twitter is in trouble, its share price has fallen 70% in the past two years and the service is not gaining new users. To halt the stagnation, CEO Jack Dorsey is reportedly considering ditching the 140 character limit.

    Commentator Josh Bernoff suggests playing with character limits will do little to address Twitter’s lack of momentum which is almost certainly correct given the underlying problems at the service.

    The one most desired feature by Twitter users is the ability to edit their posts, although the New York Times points out this may not be a good thing, another popular change would be for the service to crack down on abusive behaviour.

    Stagnant management

    It seems however that Twitter’s management can’t make those changes and this is understandable given the company’s executives not understanding how the service is used and their desperate obsession to justifying its stock valuation which, despite falling 70% over the past two years, is still $14 billion.

    Justifying that stock valuation with no clear path to monetising the service is a paralysing problem which means other useful changes aren’t being made while the company still embarrassingly cosies up to sports, pop and movie stars in the hope their fame will bring advertiser dollars to the platform.

    For Twitter the solution is to accept they aren’t a fourteen billion dollar company which would take the pressure off the executive team to find unsustainable ways to justify that valuation and instead focus management’s efforts on improving the user experience.

    Making Twitter useful

    To make the service more useful, management has to understand how Twitter is used which means finding experienced and capable leaders who also use the service.

    Adding features that allow users to make some changes to tweets and lists would be a start and clamping down on the bullies, trolls and frauds to make it more friendly to new entrants would be a start. Creating an easy way for new users to find useful information would also help engagement and retention.

    The most important task though is finding executives who actually use Twitter and have an understanding of social media instead of hiring from the tech, advertising and broadcasting industries without any regard of whether those individuals have ever used the service.

    Twitter is a valuable service but it’s dying as management play games. If it is to survive, accepting it isn’t as big as it wants to be and finding leaders who understand why its users find it so useful is essential.

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  • Value versus valuation

    Value versus valuation

    “There are people who build media companies for valuation, then there are others who build media brands for value,” writes Skift c0-founder Rafat Ali in his account of how the business stopped worrying about raising venture capital and focused on bootstrapping the travel industry website.

    Ali’s story of how Skift’s founders gave up on finding investors, refocused their business and found revenues to bootstrap the organisation is worth a read for anybody starting a venture, not just a tech or media startup.

    Notable is Ali’s distancing Skift from the startup label, claiming it’s “a meaningless word that comes with too much baggage”.

    The story of Skift is an interesting perspective on growing a business outside the current focus on external investors, instead focusing on the value it adds for customers, users and readers. Just as Skift went back to basics, many of us should also focus on how we and our businesses add value.

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  • Thinking through the effects of autonomous vehicles

    Thinking through the effects of autonomous vehicles

    The defining technology of the Twentieth Century was the automobile. While there were many advancements – antibiotics, mains electricity and mass communications to name just three – nothing changed society to the same extent as the motor car.

    A hundred years ago it was impossible for a pundit to appreciate how the motor car was about to change communities, the population’s increased mobility saw the suburbanisation of cities, the creation of the consumerist society and the rise of industries such as supermarkets and drive in theatres, none of which were foreseeable fifty years earlier.

    Change didn’t happen in isolation, those new industries were the result of a number of changes in technology alongside the motor car, for instance the supermarket couldn’t have happened without refrigerators becoming household items along with radio and television developing new markets through the advertising industry.

    Economic drivers

    The biggest driving force was economic, once motor cars became affordable for the typical worker – just before World War II in the US and in the mid 1950s in most of rest of the Western world – the cost of travelling fell dramatically.

    With the cost of moving around falling, workers had the opportunity to move out of the dirty, grimy inner city to new and clean suburbs where they could commute to their jobs in offices and factories. At the same time it also meant families could travel further to buy their groceries, forcing the end of the cornershop and the milkman.

    Autonomous vehicles change those economics again, as Uber founder Travis Kalanick pointed out last year, the most expensive item in a taxi or Uber fare is the driver.

    During his interview at the Code Conference Kalanick went on to describe how eliminating the driver changes the economics.

    “When there’s no other dude in the car, the cost of taking an Uber anywhere becomes cheaper than owning a vehicle. So the magic there is, you basically bring the cost below the cost of ownership for everybody, and then car ownership goes away.”

    Changing ownership

    The assumption in today’s discussions about autonomous vehicles is that car ownership will become and thing of the past, something that fits into Travis Kalanick’s view.

    Should that be the case then a whole range of new industries open up. Who owns the cars, who dispatches the cars, who plans for peak and normal usage are just a few questions and opportunities that open for savvy entrepreneurs.

    A changing concept of ownership doesn’t come without problems, not least who owns the code controlling the vehicles and the data being generated which in turn raises privacy issues.

    Loss of jobs

    The obvious other question with driverless vehicles is what happens to all the taxi drivers, couriers and long haul truckers as automobiles no longer require operators.

    With truck driving being the dominant occupation in most US states, employing 1.8 million workers according to the Bureau of Labor Studies, this is a serious question. Interestingly the BLS forecasts employment to grow five percent per annum over the rest of the decade.

    That scale of  job losses hasn’t been unusual over the last century. The agricultural industry itself has seen a massive fall in employment in that time period with the proportion of Americans working in agriculture falling from half the population to a tenth of that.

    Creating new industries

    Obviously half the US working population didn’t end up being unemployed, with the many of those displaced by the motor vehicle – either in the agricultural sector or in those fields catering for the pre-motor car market – finding work in other fields.

    That the economy adapted to the loss of jobs in what were traditional fields in 1915 gives us a clue to where the jobs and industries of the future are going to come from as the changing nature of the economy means new businesses are created.

    As the economics of these industries change, we see the need for workers move further up the value chain. We also see those reduced costs open opportunities for new ideas, just as the supermarket concept took hold in the 1950s as the economics of household shopping changed.

    This is where the greatest opportunity lies for today’s entrepreneurs lies, in figuring out how those reduced costs will change the way consumers and society use transportation. In turn that will drive the next wave of employment growth.

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