Friday, January 31, 2014

India Fashion Portal Myntra Raises $50M On A $200M Pre-Money Valuation As Amazon And Flipkart Circle

India’s e-commerce market is projected to grow sevenfold to $22 billion in the next five years, and investors and global e-commerce companies want to have a piece of the action. We have learned that Myntra, one of the bigger fashion portals in the country focusing both on traditional and more western fashion, has closed a $50 million round of funding. And, as that round closed, it got approached by both Amazon and Flipkart (known informally as “the Amazon of India”), with Flipkart making an acquisition offer in the region of $200 million.

The developments come on the heels of reports of both Flipkart’s interest and a fundraise.

The $50 million round, with a pre-money valuation of close to $200 million, has four main investors: PremjiInvest, Belgian-based Sofina, Accel and Tiger Global. A fifth, L Capital, may also be involved.

PremjiInvest is the investment vehicle of the family of Azim Premji, with a fund size of approximately $2 billion and a strong focus on tech. (Premji is the chairman of Wipro, the Indian IT giant that is surely one of the most epic pivots of all time: Wipro started as Western Indian Vegetable Products.) Sofina is a Belgium-based investor with a specialty in e-commerce, and both it and Tiger Global also invest in Flipkart, most recently in that company’s $160 million round. Accel is an active investor in India and was a previous investor in Myntra, which has now raised $125 million to date.

From what we understand, although the funding round and the names of the investors have been reported for some months already, it has now closed. An official announcement is due next week.

What the $50 million will mean is that Myntra now has the funds to continue to invest in its business for the next stage of growth as a standalone company, if it so chooses. The company is on track to have gross merchandise value â€" the total value of goods sold via Myntra’s portal â€" of $100 million for the current fiscal year. But it has been growing at a rapid rate. In April 2013 the rate was 100% every six months, and Myntra believes that GMV will be $1 billion by 2016-2017.

As a point of comparison, Flipkart is projecting a GMV of $1 billion by 2015.

The acquisition approaches, from what we understand, are being considered regardless of the fundraise and bigger strategy. We are still trying to get more information about the offer from Amazon. The Flipkart deal at $200 million, meanwhile, has been described to us as more of a “merger.”

“Interest from Flipkart validates the growth that Myntra is seeing,” one source very close to the negotiations told us. “[The] board is looking at all options but the fundraise is being closed in any case.”

As Pankaj noted the other day, India’s e-commerce market (sans travel sites) is currently worth $3.1 billion annually â€" just 1.5% of the value of China’s e-commerce sales, which are approaching $200 billion.

But as a huge country with a fast-growing middle class, India is seeing a relative boom in technology, which is playing out in mobile and internet penetration and expanding use of online services.

In other words, there is a world of opportunity for the future that larger, global players like Amazon and eBay (which has made a $50 million investment in another big e-commerce player in India, Snapdeal) want to capture. And so, while these two and others wait to see what India’s regulators decide to do with foreign investment rules for e-commerce, they are getting their ducks in a row.

As we have seen in other markets, e-commerce is a game of scale, where sales margins are low but volume is high, and logistics and back office investments make way more financial sense when rolled out across a larger footprint. Myntra consolidating with either another local player like Flipkart, or coming under the wing of a global giant like Amazon, would feed into that basic model.

But regardless of what happens higher up in the food chain, the same trend could also point to Myntra making some acquisitions of its own in the months ahead. It has made two acquisitions to date â€" interestingly, both in the U.S. In 2012, it acquired Exclusively.in, a private label site. And last year, it picked up Fitiquette, a Disrupt finalist that had developed virtual fitting room technology.

We are reaching out to Myntra, Flipkart, Amazon and investors for more details and will update the story as we learn more.

Thursday, January 30, 2014

With New Funding From Omidyar, Versa Launches Its Network For Sponsored Op-Eds

Versa is launching a new network for sponsored op-eds, which it calls Featured Perspectives.

The startup is also announcing that it has raised additional funding led by The Omidyar Network (the firm created by eBay founder Pierre Omidyar), bringing its total seed round to $2 million. Other investors include the John S. and James L. Knight Foundation, as well as Quotidian Ventures.

We last wrote about Versa when it raised the first part of its seed funding ($1.3 million) and was called ElectNext. At the time, the company was offering publisher widgets that would display contextual political data, but founder and CEO Keya Dannenbaum told me yesterday, “We discovered the core problem [for publishers] â€" finding a way to monetize previously unmonetized parts of their site while hopefully enhancing the newsreading experience.”

Hence the creation of the Versa Media Network, which connects online publishers with organizations willing to pay to have their opinions and content featured in related articles. You can see some examples from Versa’s initial publishers â€" in this article in The Philadelphia Inquirer, a news account of Pennsylvania Gov. Corbett’s statements on gay marriage is followed by a comment from Human Rights Watch criticizing Corbett. And this column in RealClearPolitics looking at the problems with the Obamacare website is accompanied by a comment from benefits company Maxwell Health offering its own thoughts on the issue.

maxwell

Dannenbaum said Versa has built technology that analyzes news articles as they’re published and flags the ones that may be relevant to organizations that have signed up as a potential contributors. Then, once a contributor gets an alert and decides to write something, she said it becomes “a human process” of writing a comment and submitting it for publication.

Timeliness is definitely an issue, she acknowledged â€" if someone submits an additional perspective days after an article has gone up, it’s probably not going to be seen by that many readers. However, Dannenbaum said the average response time is under an hour.

She argued that this approach benefits readers, too. Traditionally, news stories and op-eds have been “sectioned off” from each other, but online, it makes more sense to present these things “side by side.” In addition, she suggested that many organizations are trying to accomplish similar ends already, by posting anonymous comments that back up their views. So having a sponsored comment or op-ed unit makes things more transparent.

As for the quality of these Featured Perspectives, Dannenbaum said that whatever content guidelines a publisher has, they’ll also apply to Versa’s content. Plus, publishers will always have the right to remove a Featured Perspective from their site, no questions asked.

With the technology moving out of beta testing and the new funding and, Dannenbaum said the company is ready to expand its publisher network. And while most of the early uses focused on political content, she argued that Versa can be used more broadly: “I don’t think this setup is vertical-specific.”

Wednesday, January 29, 2014

WunWun On-Demand Delivery App Expands Into Brooklyn

WunWun, an app that acts like the Uber for just about anything, has expanded from Manhattan into BK (where you can have it your way).

Today marks the first time the app has been available outside of Manhattan, with WunWun helpers now answering calls in Williamsburg and Dumbo Brooklyn.

The startup launched back in November of 2012, and has since been experimenting with the right business model for a service that lets users order anything, from toilet paper, to Chipotle, to picking up your grandma from the airport.

Originally, anything you purchased from a regular store, like a pharmacy or grocery store, was delivered for free, with the amount of the cost charged to your credit card. If you wanted to place a custom order, like a delivery from a restaurant or leaving a key with your Airbnb guest, it cost an extra $20.

Recently, WunWun implemented surge pricing to deal with extra demand in the wake of a few snow storms in the North East. The Surge Pricing added on a multiplier, in increments of $5, to move your order to the front of the cue. The cap on the surge pricing was $30 and six hours.

With the launch into Brooklyn, the company has to fiddle with pricing once again.

For orders in Manhattan and delivered in Manhattan, nothing changes. The same is true for orders delivered in Brooklyn from Brooklyn Restaurants. But if I place an order from Balthazaar, a restaurant in Soho, to be delivered in Williamsburg, WunWun charges an extra ten dollars on top of my original $20 charge.

In other words, if a WunWun helper has to cross over the river to deliver or retrieve your order, add an extra $10 to the order.

Opening in Brooklyn is a big move for the startup. Though delivery is always a big deal in Manhattan, where the weather is rough and very few people have their own cars, Brooklyn has even less options than Manhattan. There aren’t quite as many pharmacies, delis, shops or restaurants in Brooklyn as there are in Manhattan, so WunWun should have an active userbase in the BK.

But why BK?

According to founder Lee Hnetinka, the company wanted to really take care of New York before heading to the West Coast. That includes all the boroughs, not just the main island.

Tuesday, January 28, 2014

Nintendo Denies Rumor Of Upcoming Android, iOS App

A report yesterday caused Nintendo fans to sit at attention. According to the Nikkei, Nintendo was preparing an Android and iOS app to demo its games. While this app wouldn’t bring full versions of Mario to smartphones, it was widely viewed as a start of something big. Well, bad news. It’s not happening. Nintendo is apparently content living in the past.

The company released a statement to Engadget unequivocally denying the report.

“Nikkei’s article contains information previously stated by Mr Iwata during past press conferences, including statements which relate to Nintendo’s willingness to make use of smart devices to promote our products.

However during such past announcements Mr Iwata has also stated that Nintendo’s intention is not to make Nintendo software available on smart devices and as such, we can confirm that there are no plans to offer minigames on smartphone devices. “

Nintendo is quickly slipping. Just last week, the company confirmed that the Wii U was a flop and slashed its sales forecast by 70%. It said it’s expecting Wii U sales to number just 2.8 million units over that period. It also cut its sales forecast for its handheld 3DS console to 13.5 million units from 18 million.

Yet, apparently, Nintendo, for now, is willing to ignore the smartphone, the biggest shift in computing since the desktop computer. Protectionism is a quick way to fade into obscurity.

Monday, January 27, 2014

Hardware Crowdfunding Platform, Dragon Innovation, Offers $100K Seed To January Projects That Raise $1M

Makers looking to squeeze a little cash from the crowd to get a project off the ground have more choice than ever before about which crowdfunding platform to position their project on. From big names like Kickstarter and Indiegogo, to a the go-it-alone route (Selfstarter) or a raft of smaller platforms with various targeted/niche approaches.

And with crowdfunding becoming increasingly, well, crowded, these platforms are having to work harder to poach promising projects off each other.

Case in point: relative newcomer to the crowdfunding platform space, Dragon Innovation, which is focused on hardware and has put in years as a manufacturing consultancy but only months as a crowdfunder platform, nabbed Internet of Things hardware catalyst project, the Wunderbar, out of the clutches of Kickstarter earlier this month.

“After first being accepted to launch on Kickstarter and planning it, we were approached by the expert team at Dragon Innovations in Boston… to launch on their crowdfunding platform,” said Wunderbar’s Jackson Bond, explaining why the switcheroo.

“They conducted a due diligence on the product and really wanted to help us launch it, with PR, marketing, and manufacturing expertise, also because their audience is Internet of Things ready.”

Dragon Innovation isn’t only doing business development via last minute pitches to promising makers. Today it’s stepped up its wooing efforts with an offer of $100,000 in seed funding to all projects that launch on its platform this month and go on to pass $1 million in crowdfunding raised.

So that’s a guarantee of a little follow-on funding if your project can nab a decent chunk of crowdbacking on Dragon’s platform via this January offer.

It’s worth noting that, to-date, no projects on Dragon Innovation’s platform have passed the one million dollar mark â€" so clearly it’s hoping to raise its own profile by bagging some higher calibre projects here. Dragon only launched its crowdfunding platform last October, although it’s been offering various services to makers since 2009 (and name-checks MakerBot, LIFX, PerkinElmer, Scout, Romotive, Sifteo and Orbotix as being among its customers).

The most a project using Dragon Innovation’s platform has raised to-date is the $196,682 raised by Tessel: an Internet-controlled microcontroller programmable in JavaScript.

In addition to $100,000 in seed funding â€" which will come in the form of a convertible note (converting into equity upon predetermined thresholds) â€" the entrepreneurs behind qualifying projects will be offered anything from Dragon’s suite of services that might help them develop their business further, such as connections to manufacturers and to other potential investors, and consulting about scaling their operations, it said. 

“The primary motivation of this program is to help companies grow and thrive,” Dragon Innovation added â€" albeit, the business of developing its own crowdfunding platform, and using that platform as an on-ramp to its additive hardware consulting services, is clearly also part of that growth target here. 

“We envision Dragon Innovation as the official home for hardware, providing entrepreneurs everything they need to launch products and scale their companies,” said Scott N. Miller, CEO and co-founder, in a statement.

“By working closely with great entrepreneurs from the very beginning, Dragon can provide a full spectrum of resources and experience to help companies succeed. It makes natural sense for us to extend this commitment in the form of funding to help hardware entrepreneurs achieve success.”

Sunday, January 26, 2014

Data As A Company’s Secret Weapon

Editor’s note: Suhail Doshi is the co-founder and CEO of Mixpanel. He started the company with the goal of helping the world learn from its data. Today more than 1,800 mobile apps and websites use Mixpanel to analyze more than 17 billion actions every single month. Follow him on Twitter @suhail.

This year, we’re going to see data go from an opaque, untapped, and mystifying asset to a hyper competitive, I-can’t-believe-you-don’t-use-it weapon for businesses. I don’t mean big data; I mean data of any size: big, medium, and small. In fact, it’s not about the amount of data, it’s about the kind of data you have (and, of course, being smart enough to use it). This is all starting to happen because software is being built specifically to analyze lots of data â€" and it’s no longer cost-prohibitive to use this software, and the insights can fundamentally change the trajectory of your business.

Think of it this way: If you’re chasing after a $10-billion market and your competitor has a way to leverage the data generated by their customers â€" and you don’t â€" the odds aren’t in your favor. Chances are, you’re going to fall behind.

The taxi industry is being upended internationally due to the emergence of high-tech companies such as Uber and Lyft. These companies are rapidly taking over the market, and not just because they’re mobile-first. Uber and Lyft are successful because they approach a classic problem â€" getting from point A to point B â€" as a mathematical equation with hundreds of potential variables. All of these variables can be tested and improved upon to create the best possible user experience. And the only way they improve that result is by having better data and smarter software. Smarter software begets more customers which begets better data which begets smarter software.

If software is eating the world, then data is acting as the essential nutrients. Data is a byproduct of the Internet that enables these businesses to be so much more compelling, competitive, and defensible.

A Huge Market With Endless Questions

All businesses have a never-ending list of questions about their customers that are crucial to answer. Smart businesses have a massive amount of data to help them find the answers. Not everyone has a Steve Jobs-like intuition when it comes to building incredible products, which means the rest of us have to come with data to make our arguments more persuasive.

This is such a valuable need to address that IBM predicts it will do $16 billion in annual analytics revenue by 2015 and has already spent more than $14 billion on acquisitions. IDC claims that the business analytics market is expected to grow around 9.7 percent for the next four years to $50 billion. In fact, many data companies have just recently started to go public in the last 2 years. Splunk’s shares popped 90 percent on the day it went public and now they’ve since doubled to a market cap over $8 billion. Tableau went public this past year and has a market capitalization over $4 billion.

It’s not just enterprise companies that are doing amazing things with data. The biggest consumer companies in the world are working hard to keep their competitive advantage â€" Google and Facebook have been paving the way for years. Google Search uses the data it crawls, as well as its users’ search behavior, to automatically improve its search engine. (Google’s big data could crunch through everyone else’s big data for lunch.) Google has even built Dremel to deal with all the data the company generates and needs to analyze. Facebook also has been innovating by building Presto to understand how Facebook users behave, and to analyze the impact of product development and user-base evolution.

Still, there’s a lot of work to do, because Facebook and Google represent some of the most serious technology companies in the world. That means many companies without this core competency have their work cut out for them. They have to catch up, and they have to figure out how to turn data into a competitive weapon that can keep them dominant in the market.

Data Is The Fuel For Massive Disruption

Data is the driving force behind the latest crop of companies looking to eat the Fortune 1000’s lunch. These innovators are utilizing data in ways their incumbents aren’t; they’re using it to learn more about what customers want and need. Not only that, but they’re building a culture that is data driven: where decisions are made with as much empirical data to support a position, instead of intuition and politics. Data has become resource that has helped efficiently democratize decision making within companies. In short, data is helping companies learn a lot faster which means better products for customers.

Nest is reinventing and disrupting the thermostat and smoke alarm industries by building better hardware and smarter software than what exists today. As you adjust the temperature in your home, Nest learns what your preference is so you ultimately don’t have to. Data is central to Nest, as the software becomes more intelligent the more it’s used.

Data is the backbone for Palantir’s software â€" a company rumored to have around $1 billion in contracts this year. You know in a movie when the director of the CIA is asking an analyst to understand the connection between the villain and a location, phone number, or license plate? They’re pretty much using Palantir’s software. The company builds software used to combat terrorism, fight fraud, analyze drugs, and conduct complex equity analysis. Without data, however, it’s entirely useless.

Homejoy is doing for home cleaning what Uber and Lyft did to the taxi industry. They even raised a $38 million round from investors shortly after they launch. So how are they growing so fast? They’re using data. Homejoy built a tool called Demand Map that enables them to predict where their future demand will come from. Demand Map works by collecting data about where, when, and how frequently Homejoy’s customers are booking cleanings with the service. This tells Homejoy which locations to focus on as they grow their business.

One reason why Netflix has successfully disrupted the movie-rental industry is that it knows more about its customers than any other company. Netflix is also a great example of a company that uses data to make its product smarter and better for customers. The Atlantic recently described one of Netflix’s data-driven ideas: “Using large teams of people specially trained to watch movies, Netflix deconstructed Hollywood. They paid people to watch films and tag them with all kinds of metadata. […] They capture dozens of different movie attributes. They even rate the moral status of characters. When these tags are combined with millions of users viewing habits, they become Netflix’s competitive advantage. The company’s main goal as a business is to gain and retain subscribers.”

When you compare this to Blockbuster’s “New Releases” shelf, it’s clear that the company never had a chance. Data is Netflix’s super-weapon, and will be a driving force behind its domination of the commercial video industry.

How Do Businesses Become Data-Driven?

At Mixpanel, we work with thousands of companies every month, helping them become data-driven. These companies are building products for mobile and web, and their customers span the globe and belong to every cross-section of our society. We’re one company in a growing industry that’s helping companies build even smarter software. Here are our key takeaways:

  1. To help keep the company focused, pick five of the most pressing questions you have. Here’s a good litmus test of whether a question is useful: is the ability to improve upon the answer something that will make or break your company?
  2. Build a culture of data-driven decision-making. Many companies over the years have built growth teams that constantly create new experiments and measure them, to find clever ways to increase customer acquisition.
  3. Have the groups within the company measure everything that is important to them. If you can’t directly measure it, survey it. And don’t measure bullshit metrics.
  4. Become more transparent about the numbers and open them up to the company. People will inevitably become more accountable and transparency further reinforces a more data driven culture.
  5. Don’t just create a report and then shred it after it’s been read. Execute and experiment based on what you’ve learned, and continuously aim to improve upon those results.

As markets begin to rapidly evolve, it becomes more pressing for businesses to keep up with the pace of innovation. To stay ahead, they’ll need to tap into their data and turn it into a super-weapon capable of building the smarter products that customers already expect.

Saturday, January 25, 2014

Failure Modes

This was a rich month for the deadpool. Prim shut down. So did CarWoo. And much-hyped Outbox. And even moot’s Canvas/DrawQuest, which had 1.4 million app downloads and 400,000 monthly users. All part of the game, right? The circle of startup life, or something.

It’s a truism that most startups fail. But in fact most startups don’t even get to fail, in the way the word is most commonly used in Silicon Valley. The “failures” listed above were, by any reasonable standard, astonishing successes; like athletes who almost-but-not-quite qualified for the Olympics. Most startups never get anywhere near as far as that. Most startups disappear without a trace.

I saw Inside Llewyn Davis last week, and it has haunted me since, mostly, I think, because it’s a brilliantly told tale of abject, anonymous failure, and you don’t encounter that much nowadays, especially in the Valley. Not that we ignore failure. No, the relationship is much more awkward than that. Instead we make a point of celebrating it…as long as it’s part of narrative of struggle which ultimately ends in success.

But the cold hard truth is that most people who fail don’t succeed in the end.

Every creative field â€" music, movies, books, art â€" follows a power law, and startups are no exception. (Of course startups are a creative field. They bring into the world richly valued things which did not exist before. That’s why they’ve become so culturally compelling; they’re perceived as combining the coolness of the arts with the filthy lucre of business.) And like every creative field, the startup ecosystem is hit-driven; a few massive successes balance out the vast teeming majority that nobody but a handful of people, or maybe, a few thousand, ever heard of.

For almost every artist/entrepreneur who succeeds â€" within or beyond their wildest dreams â€" there are 10 more who were just as smart and talented and worked just as hard but who got hit by bad luck, or were the victims of bad timing, or simply dug where there was no gold. What’s more, the super successes almost invariably got very lucky several times over. (Page and Brin would have sold Google for $750,000 back in the day. Drew Houston had higher ambitions; he would have taken $1 million after tax for Dropbox. They were lucky nobody took them up on that.)

The Valley says, “It’s OK to fail, you learn from it.” But what they really mean is, “it’s OK to fail once or twice, maybe thrice, after you’ve had your big break. But don’t push your luck much further than that.” (There are exceptions, of course, but by definition, they’re exceptional.) Again, just like any other hit-driven industry. Your big break is your first movie, your first book deal, your notice that you’ve been accepted to Y Combinator. After that you’re an insider, you’re part of the industry, looking out from within the walled garden, and you’re afforded two or three more kicks at the can before people start forgetting to return your emails.

The thing is, this is all totally fair.

Because the walled garden is too small for everyone; and if you fail repeatedly, while you learn from those failures, others are learning from their success. How to handle growth, how to cut deals, how to use media attention, how to hire good employees, how to acquire and be acquired, how to ride the fabled hockey stick, how to use each success as a springboard for the next. All lessons that you are not learning while doing your best to overcome the collapse of your latest dream.

Failure teaches you a whole lot of important stuff once, yes â€" never trust someone who’s never failed at anything, you don’t know if they’ll collapse or explode â€" but the second time? The third? You just keep falling further behind, while those who were lucky enough (and smart enough, and dogged enough) to succeed are avidly learning how to run faster.

Personally, I’ve always been horribly fascinated by failure; at the same time, I’ve had a weird knack of avoiding it. In the midst of the dot-com boom I quit a software consultancy heading for an IPO to go write novels, and it was universally understood that I was choosing failure over success â€" until that consultancy went from 110 employees on three continents to four evicted co-founders in the space of eight months, while I sold the book I wrote and spent six years as a full-time novelist. Now I write software for another (far more secure) development shop, effectively selling picks and shovels to would-be miners of this new gold rush.

Some of them have been quite successful. Some have not. Sometimes our clients drive me crazy, but I understand why. I always wanted to be a writer, to the extent that it used to be almost physically painful to walk into a bookstore. In the same way, today’s founders hunger for success. They’re starving for it. And they’re terrified of the prospect of failure.

But just like all other creative fields, most of the hungry hangers-on on the fringes of the tech-entrepreneur industry will never, ever have a real hit. The difference is that this industry is so big, so lucrative, and so fast-growing that they can stay semi-gainfully employed in it indefinitely. Is it better to always be hungry, and always be frustrated, or accept that failure was your lot, and move on? I’d say the former, but then I would, wouldn’t I?

I do believe, though, that those who have tried and failed to build their own dream make for the finest startup employees, the best sergeants and lieutenants, as long as you can make them feel that the enterprise they are joining can in some small way become their own. I would always choose someone who has failed repeatedly over someone who has never really tried to achieve anything. If nothing else, failing again and again teaches you how to keep fighting; and while helping to build someone else’s dream isn’t anywhere near as rewarding as bringing life to your own, it’s miles better than not dreaming at all.

Friday, January 24, 2014

Kickstarter Goes Tube Clock Crazy, Pick Your Crowdfunded Retro Timekeeping Poison

Kickstarter has a fever at the moment, and the only cure is more tube clocks. For those unaware of this type of gadget, a Nixie tube clock uses heated cathodes in a glass-encased gaseous mixture to display the time, and there are currently two undergoing crowdfunding campaigns on Kickstarter, both of which launched in the past week.

The two clocks share the same basic technological premise, but have very different design sensibilities, so fans of retro chic can choose between them based on whether they’re more Steampunk or more modern. The Steampunk Nixie Clock is a Vancouver-based project that just launched, and is seeking $6,000 in funding, and the Blub (which is the more modern of the two) has already blown past its $5,000 funding goal.

For the minimalist, the oddly named Blub (play on ‘bulb?’) is the clear clock of choice. It features a very Mac-like aluminum rounded rectangular casing, with a simple light to indicate operational status and four tubes for rendering the numbers to tell time. It’s smaller than you might think at first glance, fitting neatly in an average-sized hand, and it not only tells the time and provides an alarm, but also detects and displays the temperature with the press of a button.

The Blub ain’t cheap: it’ll set you back around $320 US for a pre-order, plus an additional fee for shipping. Blub designer Duncan Hellmers anticipates shipping the first units in May of 2014.

For those more committed to the vintage aesthetic, the Steampunk Nixie Tube Clock offers a lot of wood, some brass, and plenty of extraneous rivets, screws, grills and knobs to drive home that special blend of fantasy and uselessness that makes Steampunk such an appealing design phenomenon. The Steampunk Nixie is more complicated, however, and that means it’s also more expensive: The regular backer pre-order price is $549.

The Steampunk has some special tricks up its sleeve, however, including an LED backlight for the Nixie tubes that provides changeable color options, and each is hand-made. The going price for elaborate Steampunk creations like this tends to easily wander into the thousands, so this is actually a very reasonable ask from project creator Kyle Miller.

The anticipated ship date for the Steampunk Nixie Clock is June 2014, so it’s about on par with the anticipated ship date of the Blub. Whether that means there’s a fairly standard turnaround time on the creation of clocks that use Nixie tubes, I couldn’t tell you, but it means time shouldn’t play a role in your decision between the two.

Thursday, January 23, 2014

App Revenue In Asia Grew A Massive 162% In 2013, Driven By Google Play

Over the past two years, Asia has emerged as the world’s top marketplace for appsâ€"and it’s still growing. Revenue in Asia rose by a massive 162% in 2013, “annihilating” growth in all other continents, according to a new report by Distimo. Furthermore, that increase was fueled in large part by Google Play, where revenue from Asia more than quadrupled in 2013.

In comparison, the App Store’s growth in Asia was much slower: a 94% increase in revenue for iPhone apps and 64% for iPad apps. But that was still faster than the App Store’s total growth in Europe or North America, as seen in the chart below.

Distimo 1

For its report, Distimo looked at daily App Store and Google Play downloads.  Asia accounted for 41% of global app revenue in December 2013, compared to 31% from North America and 23% from Europe.

Overall app revenue in Asia is now split almost evenly between Google Play and Apple’s App Store. In comparison, the App Store still leads in North America, where it accounts for 75% of app revenue, with Google Play making up the remaining 25% (the divide is similar in Europe).

“Clearly, Asia is a different landscape than what’s seen in North America and Europe,” wrote Distimo analyst Anne Hezemans.

Distimo 4

A lot of attention has been paid to China’s alternative Android app stores, thanks in part to the $1.9 billion acquisition of 91 Wireless by Internet giant Baidu. But Japan is still the most lucrative country for app developers in Asia, followed by South Korea and China. Though mobile penetration rates are rising rapidly throughout the continent, especially in Southeast Asia, there is still a wide disparity between app revenue in different regions.

“To put into perspective the enormous difference in revenue between the top Asian country Japan and Malaysia, Japan’s revenue is 77 times that of Malaysia’s,” wrote Hezemans. “The extremely disproportionate revenue share among Asian countries led us to believe that the market isn’t evenly divided.”

Distimo 2

Even though Japan was last year’s leader in app revenue, South Korea enjoyed the highest growth. App revenue in the country shot up by 271%. Most revenue in South Korea came from Google Play, which is unsurprising because Apple holds just a 14% market share there, according to Flurry.

Freemium is still the leading business model in Asia. In China, apps generated 96% of revenue from in-app purchases, while Japan and South Korea had similar rates at 94% and 91%, respectively. In comparison, in-app purchases generates about 76% of revenue in the U.S.

Distimo 3

Like their counterparts in the rest of the world, most mobile users spend their in-app time playing games. Rovio’s Angry Birds Go! was the most downloaded game in Asia in December, followed by a Chinese game called CarrotFantasy2: Polar Adventure.

For China, where only 3.5% of devices have Google Play installed, Distimo partnered with Wandoujia, one of the largest alternative Android app stores in the country, to get data from more than 300 million users.

According to Wandoujia, games by foreign developers “have a big opportunity to reach millions of gamers in China,” as evidenced by the popularity of titles like Temple Run 2, Subway Surfers, Angry Birds, and Fruit Ninja, all of which were among the top seven titles in the country last year.

But local developers still dominate non-game apps, just as local software dominated the PC Internet.

“China’s domestic market is so large that it can support an entirely independent ecosystem from the rest of the world,” said the report.

In fact, the 3.5% of Chinese users who do have Google Play on their phones are a relatively international demographic. Just 65% of the apps they purchased were made by local developers, compared to 87% for Wandoujia’s users.

Many Western game makers were initially skeptical about breaking into China’s app marketplace because of piracy and the difficulty of monetizing games. But Wandoujia’s data showed that mobile gamers are now more willing to spend money on in-app purchases. From April to November 2013, the average revenue per paying user for massively multi-player online games grew a massive 400%, beating growth in Japan (282% year-over-year) and Korea (342% year-over-year).

“Android users have a hungry appetite for in-game purchases, bucking the old myth that Chinese users won’t spend money for services,” wrote Hezemans.

For more data, see the full report.

[[Image by Newport Geographic]]

Wednesday, January 22, 2014

Somewhere Between Coke And Nintendo, Rovio Wants To Be A Super Brand

Being a successful gaming company is hard. Not only is the competitive landscape vastly overcrowded, but the winds of change pull people from one gaming hit to another faster than you can water your Farmville strawberries.

But for the past four years, one gaming company has miraculously stayed relevant: Rovio.

In an interview with the New York Times, Rovio’s Mighty Eagle, CEO and founder Peter Vesterbacka shed some light on the future of the Angry Birds franchise.

“We will continue to do spinoffs that play on our brand strength,” said Vesterbacka. “It’s just like Nintendo and its series of Mario-based games. We want to continue expanding Angry Birds to make it a permanent part of popular culture.”

In other words, don’t expect to see Rovio pivot its energy into a brand new game with no relation to Angry Birds. In fact, Vesterbacka seems intent on growing the Angry Birds brand by whatever means necessary, whether its through new spin-off games, education, or entertainment.

Nothing short of Coke-like success will satisfy him.

“We look at iconic brands like Coca-Cola for inspiration,” said Vesterbacka. “If Coke can reach one billion servings each day, there’s no reason why we can be less ambitious. With the growth of connected devices like smartphones and tablets, we want one billion people to be interacting with our brand through games, soft drinks, parks and other products.”

To that end, the company has introduced educational materials and games that involve Angry Birds, as well as merchandise like plush toys, cookbooks, and even band-aids. And that’s just the start of it.

Rovio also has an Angry Birds cartoon series that is distributed through the game itself, transforming Angry Birds from a single gaming app on your phone into a platform for entertainment distribution. The Finnish company even has Angry Birds-themed amusement parks.

One such theme park is in China, where Rovio has made huge inroads and plans to activate parks all over the country. Angry Birds is not only one of the most popular mobile games in China, but it’s also one of the biggest markets for Angry Birds-themed merchandise.

Other, younger gaming companies have tried to mimic the success of Angry Birds with their own runaway hits, but perhaps don’t understand the importance of the brand itself.

“Some gaming companies are clueless about branding,” said Vesterbacka. “They build games to last 100 days and move on to the next one. There’s no guarantee that they will create hits. It’s difficult to find examples of anyone in entertainment that can produce hits successfully.”

Rovio recently went freemium, likely in an attempt to compete with up-and-comers like King’s Candy Crush Saga, which is available for free with the option to pay for special features. But this adaptation is one of the keys to Rovio’s success.

“In five years from now, we could be looking at a completely different way of monetizing games,” said Vesterbacka.

Tuesday, January 21, 2014

Phablets Are Officially A Thing, With 20M Shipped In 2013

God help us. Phablets are officially a thing.

According to Juniper Research, phablets are expected to hit 120 million units shipped by 2018, up from the estimated 20 million phablets shipped last year (2013).

Samsung validated the trend with the super-sized Galaxy Note series, which has gone on to be surprisingly successful for the Korean electronics giant.

The growth in the space is obvious when you look at Samsung’s numbers.

With the first Galaxy Note, launched in late 2011, the company sold 2 million units in the first four months. Samsung’s most recent iteration of the device, the Galaxy Note 3, sold 5 million units in a week.

But Samsung isn’t the only company to push out giant phones. LG recently released the G Flex, with a giant, curved display, Nokia has the Lumia 1520 running Windows 8, and HTC has the One Max (to name a few).

Apple, on the other hand, doesn’t have a phablet per se. However, as phablets have grown in popularity, Apple has made slight changes to its products to accommodate these growing trends, such as the release of the iPad mini and the extension of the iPhone screen from 3.5 inches to 4-inches.

The term “phablets” rose to prominence over the past two years, connoting a tablet-smartphone hybrid. Juniper believes that the screen must be 5.6 inches to meet phablet requirements.

So we now know that phablets are here to stay. But riddle me this: Is “phablet” too popular a term to swap it out for “tablone?”

Monday, January 20, 2014

Messaging Juggernaut WhatsApp, Now With 430M Users, Has No Plans For Disappearing Photos

WhatsApp, an early mover in the messaging app space, has racked up 430 million active users to date. But despite the influx of new competition from the likes of Line, WeChat, KakaoTalk and Snapchat, WhatsApp will be sticking to its guns: avoiding advertising; staying away from “gimmicks” like disappearing photos and games; and continuing to request its users to keep paying to use the service as its basic business model.

(The app, which used to be paid, is now free to download and costs $0.99/year to use after the first year.)

The comments were made by co-founder and CEO Jan Koum, who was speaking at the DLD conference in Munich, Germany. “The important thing is focus,” he said, not disappearing photos â€" a reference to the ephemeral messaging service Snapchat.

Of WhatsApp’s 430 million users, some 30 million started using the app in the last couple of months (it only announced 400 million in December). WhatsApp now sees some 50 billion messages sent and received daily â€" rivalling SMS volumes.

“No ads, no games, no gimmicks,” Koum said today. It’s a credo that is written on a Post-It note from co-founder Brian Acton (who first worked with Koum at Yahoo). Koum keeps that note, which he got Acton to sign, on his desk as a reminder of where WhatsApp would like to remain anchored.

“We just want to focus on messaging. If people want to play games there are plenty of other sites and also a lot of great companies building services around advertising,” he added. It’s a “free market” with apps, so the beauty is that people can get those features elsewhere, Koum said.

Koum declined to talk about whether the company is profitable or any other financial metrics. “We make money, but the important thing [now] is not monetization,” he said simply. Someday the company will focus on it, but today the main aim is to to make sure WhatsApp has a service that works.”

We have heard reports of companies like Snapchat rebuffing acquisition overtures from the likes of Facebook and Google for $4 billion, and similarly Koum and WhatsApp remain bullish on staying independent to grow, as they have before when acquisition rumors surfaced.

“When we started the company we wanted to build something for the long term and sustainable,” he told interviewer David Rowan of Wired. “It’s not hard to sell a company but if you look at [leading online] companies today like Facebook, Google, Yahoo and Twitter, they didn’t sell. They stuck around and built a great offering for users.” Koum acknowledged that these are all built on advertising, while WhatsApp is not, but the main idea remains: “For us it’s about [building] a company that is here to stay.”

Although WhatsApp is now pushing half a billion users, the company has remained very light and has tried to keep its startup mentality. The company currently employs 50 people, 25 of which are engineers, and another 20 that focus on multilingual customer support. “We’re extremely small,” Koum said.

Your business model is pretty atypical. “We’ve always thought that advertising would be the wrong thing to do,” he said. By people giving us money, “we’ve always had a direct relationship” with users.

Koum’s upbringing in Soviet Ukraine, he says, has played a large part in how WhatsApp’s business model has developed. That extends from the no-ads policy and the ability to offer reliable and inexpensive communications, through to how the startup handles privacy.

On the subject of pricing, Koum recalled how, when he first moved to the U.S., it was expensive and difficult to phone family long distance, with the need to sign up to long distance phoning plans â€" a challenge for immigrants with limited resources. “With WhatsApp you don’t have to pay exuberant fees,” he said.

The lack of advertising, meanwhile, is a throwback to his life before the U.S. “I grew up in a country where advertising didn’t exist and I had a remarkable childhood,” he said. “Looking back it was an idealistic environment. Even though there were thousands of problems, the joy of growing up in an uncluttered lifestyle [meant] you could focus on other things.” Advertising, he said, is emblematic of the kind of information clutter that he did not know.

On the other hand, WhatsApp’s approach to privacy is a response in the opposite directly. “I remember my parents having no conversations on the phone. The walls had ears and you couldn’t speak freely,” Koum recalled. “It is extremely important [for us] to provide a level of security and privacy…. We don’t collect people’s personal information. We just know your phone number and those of the people you want to message with.” He said WhatsApp makes a point of knowing “as little as possible” about users.

Covering a wide range of topics, Koum also was upfront about his preference for Android as a platform over iOS. “Android is a lot more open. We are able to build new features and prototype faster on Android, not to mention that we have a lot more users on Android,” he said.

Longer term, it doesn’t look like WhatsApp plans to turn away from smartphones for its core experience any time soon. “Our goal is to be on every smartphone.” Quoting a projection of 5 billion total smartphones down the line, he said their goal is to be “on every single one of them.”

Sunday, January 19, 2014

How To Get An MBA From Eminem

Editor’s note: James Altucher is an investor, programmer, author, and several-times entrepreneur. His latest book is “Choose Yourself!” (foreword by Dick Costolo, CEO of Twitter). Follow James on Twitter @jaltucher.

In 2002 I was driving to a hedge fund manager’s house to hopefully raise money from him. I was two hours late. This was pre-GPS and I had no cell phone. I was totally lost.

I kept playing over and over again “Lose Yourself” by Eminem.

I was afraid this was my one shot and I was blowing it. I was even crying in my car. I was going broke and I felt this was my one chance. What a loser.

Finally I got there. The hedge fund manager was dressed all in pink. His house was enormous. Maybe 20,000 square feet. His cook served us a great meal. I had made him wait two hours to eat. And he had cancer at the time. I felt really bad.

Then we played chess and it was fun and he gave me a tour of the house. One room was just for toys made in 1848. He had a squash court inside the house.

Another room had weird artifacts like the handwritten notes from when Lennon and McCartney were first writing down the lyrics for “Hey Jude.”

Another was the official signed statement by Ted Kennedy in the police station after he reported the Chappaquiddick accident that may have ultimately played a part in his decision to not run for president.

Eventually I did raise money from this manager and it started a new life for me.

But that’s not why I bring up Eminem at all.

The song “Lose Yourself” is from the movie “8 Mile.” Although I recommend it, you don’t have to see it to understand what I am about to write. I’ll give you everything you need to know.

Eminem is a genius at sales and competition and he shows it in one scene in the movie.

A scene I will break down for you line by line so you will know everything there is to know about sales, cognitive bias, and defeating your competition.

First, here’s all you need to know about the movie.

Eminem plays a poor, no-collar, self-proclaimed “white trash” guy living in a trailer park. He’s beaten on, works crappy jobs, gets betrayed, etc. But he lives to rap and break out somehow.

In the first scene he is having a “battle” against another rapper and he chokes. He gives up without saying a word. He’s known throughout the movie as someone who chokes under pressure and he seems doomed for failure.

Until he chooses himself.

The scene I will show you and then break down is the final battle in the movie. He’s the only white guy and the entire audience is black. He’s up against the reigning champion that the audience loves.

He wins the battle and I will show you how. With his techniques you can go up against any competition.

First off, watch the scene (with lyrics) before and after my explanation.

Here is the scene: http://www.youtube.com/watch?v=gatNLacOjC8

8 Mile Papa Doc

Watch it right now.

Ok, let’s break it down. How did Eminem win so easily?

Setting aside his talent for a moment (assume both sides are equally talented), Eminem used a series of cognitive biases to win the battle.

The human brain was developed over the past 400,000 years. In fact, arguably, when the brain was used more to survive in nomadic situations, humans had higher IQs then they had today.

But one very important thing is that the brain developed many biases as short-cuts to survival.

For instance, a very common one is that we have a bias towards noticing negative news over positive news.

The reason is simple: if you were in the jungle and you saw a lion to your right and an apple tree to your left, you would best ignore the apple tree and run as fast as possible away from the lion.

This is called “negativity bias” and it’s the entire reason newspapers still survive by very explicitly exploiting this bias in humans.

We no longer need those short-cuts as much. There aren’t that many lions in the street. But the brain took 400,000 years to evolve and it’s only in the past 50 years maybe that we are relatively safe from most of the dangers that threatened earlier humans.

Our technology and ideas have evolved but our brains can’t evolve fast enough to keep up with them. Consequently, these biases are used in almost every sales campaign, business, marketing campaign, movie, news, relationship, everything.

Almost all of your interactions are dominated by biases, and understanding them is helpful when calling BS on your thoughts or the actions of others.

You have to learn how to reach past the signals from the brain and develop intuition and mastery over these biases.

1) In-group Bias

Notice Eminem’s first line: “Now everybody from the 313, put your mother-f*cking hands up and follow me”.

The 313 is the area code for Detroit. And not just Detroit. It’s for blue-collar Detroit where the entire audience, and Eminem, is from.

So he wipes away the outgroup bias that might be associated with his race and he changes the conversation to “who is in 313 and who is NOT in 313″.

2) Herd Behavior

He said, “put your hands up and follow me.” Everyone starts putting their hands up without thinking. So their brain tells them that they are doing this for rational reasons.

For instance, they are now following Eminem.

313

3) Availability Cascade

The brain has a tendency to believe things if they are repeated, regardless of whether or not they are true. This is called Availability Cascade.

Notice Eminem repeats his first line. After he does that he no longer needs to say “follow me.” He says, “look, look.”

He is setting up the next cognitive bias.

4) Distinction Bias Or Outgroup Bias 

Brains have a tendency to view two things as very different if they are evaluated at the same time as opposed to if they were evaluated separately.

Eminem wants his opponent “Papa Doc” to be evaluated right then as someone different from the group, even though the reality is they are all in the same group of friends with similar interests, etc.

Eminem says: “Now while he stands tough, notice that this man did not have his hands up.”

In other words, even though Papa Doc is black, like everyone in the audience, he is no longer “in the group” that Eminem has defined and commanded: the 313 group.

He has completely changed the conversation from race to area code.

5) Ambiguity Bias

He doesn’t refer to Papa Doc by name. He says “this man.” In other words, there’s “the 313 group” which we are all a part of in the audience and now there is this ambiguous man who is attempting to invade us.

Watch presidential campaign debates. A candidate will rarely refer to another candidate by name. Instead, he might say, “All of my opponents might think X, but we here know that Y is better”.

When the brain starts to view a person with ambiguity it gets confused and CAN’T MAKE CHOICES involving that ambiguity. So the person without ambiguity wins.

6) Credential Bias

Because the brain wants to take short cuts, it will look for information more from people with credentials or lineage than from people who come out of nowhere.

So, for instance, if one person was from Harvard and told you it was going to rain today and another random person told you it was going to be sunny today you might be more inclined to believe the person from Harvard.

Eminem does this subtly two lines later. He says, “one, two, three, and to the four.”

This is a direct line from Snoop Doggy Dogg’s first song with Dr. Dre, “Ain’t Nothin But a G Thing.” It is the first line in the song and perhaps one of the most well-known rap lines ever.

Eminem directly associates himself with well-known successful rappers Dr. Dre and Snoop when he uses that line.

He then uses Availability Cascade again by saying, “one Pac, two Pac, three Pac, four.” First, he’s using that one, two, three, and to the four again but this time with Pac, which refers to the rapper Tupac. So now he’s associated himself in this little battle in Detroit with three of the greatest rappers ever.

7) Ingroup/Outgroup

Eminem points to random people in the audience and says “You’re Pac, He’s Pac,” including them with himself in associating their lineages with these great rappers.

But then he points to his opponent, Papa Doc, makes a gesture like his head is being sliced off and says, “You’re Pac, NONE”. Meaning that Papa Doc has no lineage, no credibility, unlike Eminem and the audience.

8) Basic Direct Marketing: List The Objections Up Front

Any direct marketer or salesperson knows the next technique Eminem uses.

When you are selling a product, or yourself, or even going on a debate or convincing your kids to clean up their room, the person or group you are selling to is going to have easy objections.

They know those objections and you know those objections. If you don’t bring them up and they don’t bring them up then they will not buy your product.

If they bring it up before you, then it looks like you were hiding something and you just wasted a little of their time by forcing them to bring it up. So a great sales technique is to address all of the objections in advance.

Eminem’s next set of lines does this brilliantly.

He says, “I know everything he’s got to say against me.”

And then he just lists them one by one:

“I am white”
“I am a fuckin bum”
“I do live in a trailer with my mom”
“My boy, Future, is an Uncle Tom”
“I do have a dumb friend named Cheddar Bob who shot himself with his own gun”.
“I did get jumped by all six of you chumps”

And so on. He lists several more.

But at the end of the list, there’s no more criticism you can make of him. He’s addressed everything and dismissed them. In a rap battle, (or a sales pitch), if you address everything your opponent can say, he’s left with nothing to say.

When he has nothing to say, the audience, or the sales prospect, your date, your kids, whoever, will buy from you or listen to what you have to say.

Look at direct marketing letters you get in email. They all spend pages and pages addressing your concerns. This is one of the most important techniques in direct marketing.

9) Humor Bias

Eminem saves his best for last. “But I know Something About You” he says while staring at Papa Doc.

He sings it playfully, making it stand out and almost humorous. There is something called Humor Bias. People remember things that are stated humorously more than they remember serious things.

10) Extreme Outgroup

“You went to Cranbook.” And then Eminem turns to his “313 group” for emphasis as he explains what Cranbook is. “That’s a private school.”

BAM!

There’s no way now the audience can be on Papa Doc’s side but Eminem makes the outgroup even larger. “His real name’s Clarence. And his parents have a real good marriage.”

BAM and BAM! Two more things that separate Papa Doc from the crowd. He’s a nerdy guy, who goes to a rich school, and his parents are together.

Unlike probably everyone in the audience, including Eminem. No wonder Papa Doc doesn’t live in the 313, which was originally stated somewhat humorously but is now proven without a doubt.

11) Credential bias (again)

Eminmen says, “There ain’t no such thing as”… and the audience chants with him because they know exactly what he is quoting from “Halfway Crooks!” a line from a song by Mobb Deep (I did their website back in 1998), another huge East Coast rap group. So now Eminem has established lineage between himself and both the West Coast and the East Coast.

And by using the audience to say “Halfway Crooks” we’re all in the same group again while “Clarence” goes back to his home with his parents at the end of the show.

12) Scarcity

The music stops, which means Eminem has to stop and let Papa Doc have his turn. But he doesn’t. He basically says “F*ck everybody”, “F*ck y’all if you doubt me.” “I don’t wanna win. I’m outtie.”

He makes himself scarce. After establishing total credibility with the audience he basically says he doesn’t want what they have to offer.

He reduces the supply of himself by saying he’s out of there. Maybe he will never come back. Reduce the supply of yourself while demand is going up and what happens? Basic economics. Value goes up.

He’s so thoroughly dominated the battle that now, in reversal to the beginning of the movie, Papa Doc chokes. He doesn’t quite choke, though. There’s nothing left to say. Eminem has said it all for him.

There’s no way Papa Doc can raise any “objections” because Eminem has already addressed them all. All he can do is defend himself, which will give him the appearance of being weak. And he’s so thoroughly not in the “313 Group” that there is no way to get back in there.

There’s simply nothing left to say. So Eminem wins the battle.

And what does Eminem do with his victory? He can do anything.

But he walks away from the entire subculture. He walks off at the end of the movie with no connection to what he fought for.

He’s going to Choose Himself to be successful and not rely on the small-time thinking in battles in Detroit.

He’s sold 220 million records worldwide. He discovered and produced 50 Cent who has sold hundreds of millions more (and is another example of “Choose Yourself” as Robert Greene so aptly describes in his book “The 50th Law”).

Doesn’t it seem silly to analyze a rap song for ideas how to be better at sales and communicating? I don’t know. You tell me. I’ve exposed myself so much in my blog posts. In fact, I don’t hit “Publish” on something unless I’m afraid of how people will react.

When you expose yourself there are many many ways for people to attack you. People will stab you and hurt you. But you can’t create art unless you show how unique you are while being inclusive with others who share your problems.

I’m still scared when I hit publish. But I love that final feeling of risk and fear. The rush. The carriage return. Click.

Saturday, January 18, 2014

Amazon Patents “Anticipatory” Shipping — To Start Sending Stuff Before You’ve Bought It

Amazon’s plans for autonomous flying delivery drones are so last year. The ecommerce juggernaut is purportedly working on something far more dystopian: pre-shipment.

Amazon has filed a patent for a shipping system designed to cut delivery times by predicting what buyers are going to buy before they buy it â€" and shipping products in their general direction, or even right to their door, before the sales click even (or ever) falls.

Which really is one more step towards cutting out human agency entirely from the ecommerce roundabout. Why not have machines autonomously buy stuff from other machines and have a third set of autonomous bots deliver it â€" while the quaking flesh recipients who open the door meekly accept whatever packages they are getting in the hopes that yet more machines won’t decide today is the day to harvest their organs.

[Aaaand right on cue, the doorbell rings. It's a delivery man, with -- you guessed it -- an Amazon parcel for me. This interaction should be entirely normal but there's a distinctly sinister undertone, even though I'm 99.9% sure that the thing inside the box is something I ordered last week, not something Amazon thinks I'll want to order next week. Or the thing I ordered a few minutes ago. But that, presumably, is exactly where Amazon is aiming to go.]

The patent, which was filed in August 2012 and granted December 24 last year, describes a method for what Amazon calls “anticipatory shipping” â€" with one pre-shipping scenario (of the multitudes detailed) being as follows:

…a method may include packaging one or more items as a package for eventual shipment to a delivery address, selecting a destination geographical area to which to ship the package, shipping the package to the destination geographical area without completely specifying the delivery address at the time of shipment, and while the package is in transit, completely specifying the delivery address for the package.

Amazon delivery patent

The anticipated location of packages might be determined by analysing various “business variables”, according to the patent. Data that could be analysed to determine customer demand for a particular pre-shipped package to help decide where to route it geographically could include historical buying patterns, preferences expressed explicitly via surveys/questionnaires, demographic data, browsing habits, wish-lists and so on.

The patent also goes on to discuss in detail various scenarios for “speculatively shipping” packages to destinations and how to re-route items based on proximity to potential customers â€"  and even how packages might remain in near continuous transit on trucks until a customer makes a purchase.

At times the language of the patent sounds as if Amazon is thinking of physical item delivery in the way a utility might approach supplying water or electricity to homes â€" by forecasting demand spikes and lulls, and tweaking its pipeline accordingly, but above all by keeping the stuff flowing (ergo having trucks constantly filled with packages in continuous perpetual motion).

Such a system would likely require an overhaul of its existing ecommerce inventory and time-management systems (assuming Amazon hasn’t already started deploying the apparatus to support anticipatory shipments) â€" to make them more dynamic and responsive. But that in turn may allow for better inventory management, as the patent notes

… speculative shipping of packages may enable more sophisticated and timely management of inventory items, for example by allowing packages to begin flowing towards potential customers in advance of actual orders.

And in those instances when the demand prediction algorithm fails, as well it must, the patent suggests Amazon could deliver the package anyway â€" as a gift to someone who hasn’t actually clicked to buy it yet, but who, its data analysis suggests, might quite like it â€" i.e. if the cost of returning/rerouting the item exceeds the cost of paying a surprise visit to a pre-customer.

Which could either be a great surprise, or hideously inappropriate â€" depending on how good an oracle Amazon’s algorithm turns out to be. Inappropriate like delivering a DIY Will pack to someone who has already died, say. Or kids toys to bereaved parents. Anticipatory algorithms are going to have to navigate plenty of human pitfalls if they’re not to end up clanging on the doorbell.

In the U.S. Amazon paved the way for carving a huge chunk out of the ecommerce pie by patenting the right to one-click buying, all the way back in 1999. That patent has stood it in excellent stead over the years, requiring other ecommerce players to license this method if they want similarly speedy checkout processes.

Pre-shipping has the potential to let Amazon do that again by taking the online buying process to the proverbial ‘next level’ â€" and some. Clicking buy and getting your stuff hours or minutes later would be huge. Albeit, in future it could well be a case of: Amazon users, be careful what you wish(-list) for.

(Via the Wall Street Journal)

Friday, January 17, 2014

HTC Said To Be Planning Larger Screen Version Of HTC One Flagship Smartphone For March

HTC is said to be readying the next generation of the HTC One, which will keep the same simple moniker but offer up a larger display and a camera with a so-called “twin-sensor” rear-facing camera, according to Bloomberg (via Verge). The screen will be at least 5-inches diagonally, which is slightly larger than the existing 4.7-inch HTC One, but overall the design will resemble that of its predecessor.

I’m feeling conflicted about this new device: On the one hand, the HTC One is easily one of the top three best Android phones of 2013; on the other, it’s clear that the HTC One didn’t do much to turn around HTC’s flagging fortunes, despite the extremely positive reception it had among press and the few people who did buy one.

Still, maybe a year of positive press and hype associated with the HTC One name will help the Taiwanese company move more units this time around, paired with a bigger screen (which seems to be high on customer want lists) as well as this improved camera, which is said to offer better focus performance, improved depth of field and better image quality overall, according to Bloomberg’s source.

As sad is it to say, HTC doesn’t need another smartphone that appeals to the connoisseur crowd: It needs a runaway mass-market success. They did great work with the HTC One, but sticking close to the original design in this case does mean they run the risk of shipping another beloved but mostly ignored device.

Thursday, January 16, 2014

Microsoft Open Tech Expands To China

Microsoft Open Technologies, a fully owned subsidiary of Microsoft, has long been the company’s main vehicle for reaching out to the open source community. Its main mission is to build technical bridges between Microsoft’s products and open source projects. To allow it to more efficiently work with the fast-growing Chinese market, Open Tech is opening its first international office in Shanghai today, which itself is a fully owned subsidiary of Microsoft Open Tech in the U.S.

As Gianugo Rabellino, the senior director of Open Source Communities at MS Open Tech, told me earlier this week, the idea here is to continue the work that the team has always done. This means reaching out to local open source communities and attending and organizing events. “What we have learned over the years is that it’s not just about events,” he noted. “It’s about day-to-day work with the organizations and engaging with the community.”

In Rabellino’s view, China presents a massive opportunity for MS Open Tech. There are quite a few open-source projects around media servers and databases that are very popular in China, for example, that few developers in Europe or the U.S. have ever heard about. There are also others, like the 2D gaming library CocoStudio, that are already used around the world, but that dominate the market in China.

“The open-source work that is happening in China has a great opportunity to impact the market in general,” Rabellino told me, and that’s why MS Open Tech wants to be a part of it.

In the U.S., the Open Tech team works on projects like porting Node.js to Azure and maintaining a library of open source-based virtual machines for Microsoft’s cloud computing service. The team also worked on bringing Pointer Events to Google’s Blink, Apache’s Cordova project and numerous other open-source tools.

It may still seem like a bit of an oxymoron for some that Microsoft would work on open source projects. As long as you “come bearing patches” and focus the discussion on technology, however, most projects are more than happy to work with the company, according to Rabellino.

Wednesday, January 15, 2014

Venga Reserves $1 Million Series A To Create Restaurant Customer Profiles

Venga, a DC-based startup, has raised $1 million in Series A financing to help restaurants create profiles of their customers by whipping reservation data, point-of-sale, and other basic information into a soufflé of delicious CRM.

Militello Capital led the round and a number of major restaurant groups and angels also invested. Think Food Group, Bill and Pat Anton, and Cornell’s Big Red Ventures were also on the menu.

Founded by Sam von Pollaro and Winston Bao Lord, the company incubated in the The Fort in DC. The company bills itself as the only “complete guest management platform for restaurants” and essentially takes reservations data and point of sale information to create a customer profile. This allows restaurants to offer dedicated, personalized service as a matter of course, ensuring that VIPs get extra breadsticks and chilled tap water.
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“Venga is completely seamless for the restaurants that use it and the guests that benefit from it. The guest does not have to opt into a program or give an email address, credit card or a phone number, which eliminates the hassle and annoyance associated with many guest management systems,” said Lord. “Similarly, the restaurant’s staff does not have to change the way they work as the system was created to link with the point-of-sale and OpenTable systems the restaurant already uses.”

The system also maintains the customer’s purchase history and, if the guest provides an email, it can segment customers into special mailing lists. For example, restaurants can offer wine tastings to the lushes and chocolate parties to the chocoholics. It also allows waiters to know a bit more about their customers before they sit down.

“We allow our clients to track not only who came back to the restaurant but also how much they spent as a result of the campaign,” said Lord.

At its core, the company basically connects two pieces of information â€" the reservation with preferences. By doing this they can achieve what most restaurant hosts only acquire with years of experience and identify customers by name and supply them with perks that only long time customers can get. After all, the hotel industry has done this for years. Venga is simply trying to help restaurants catch up.

Tuesday, January 14, 2014

WP Engine Raises $15M From North Bridge Growth Equity To Invest In Product Development, Accelerate Growth

WP Engine, one of the largest hosting companies that specialize in running WordPress sites, today announced that it has raised $15 million in funding from North Bridge Growth Equity. The company says the funding is meant to help it accelerate growth and invest in product innovation across its platform.

This latest round of funding, the company’s COO Heather Brunner told me earlier this week, brings the company’s total funding to $18.2 million. According to Brunner, WP Engine still had a good amount of its earlier funding in the bank, but decided to go ahead and raise now in order to be able to grow its service quickly. While the company has about 100 employees right now, Brunner expects to double this number by the end of the year. Come 2015, WP Engine also plans to open its first international office in Europe. Today, WP Engine has offices in Austin and San Francisco.

The company, Brunner told me, has grown about 25 percent every quarter since inception and currently has about 14,000 customers who host over 120,000 unique sites and domains on its platform. Those sites pay host to about 36 million unique visitors per day. According to the company’s own data, it posted 3x year-over-year revenue growth last year and expects to double revenue this year.

Because of this rapid growth, WP Engine received a lot of inbound interest from venture capital firms. After looking at about 20 offers, Brunner said, the company decided on North Bridge. The executive team was mostly interested in finding a good fit between the VC and WP Engine.

North Bridge fit the bill because its portfolio includes a number of companies with open source backgrounds. As part of this funding deal, the company has added Matthew Blodgett, a general partner at North Bridge Growth Equity, to its board. Blodgett, Brunner told me, will especially be able to help the company optimize its growth strategy.

WP Engine isn’t planning on using any of the new funding for acquisitions, though it did just announce a very small one. The company took over the hosting business of Crowd Favorite last week, though this was more of a user acquisition deal than an exchange of employees and technologies.

Looking ahead, WP Engine plans to build a number of new tools for its customers and bring some it currently uses internally to its users as well, though Brunner didn’t go into any details about which tools it has planned. She did say, however, that the company plans to continue to focus on making WordPress faster, more scalable and more secure.

Monday, January 13, 2014

Monster’s Keys To CES Success Are Celebrities, Style, And Hype

If you check out CNET or Engadget‘s top-ranked headphones, you won’t find many Monster products on the list. And yet, Monster is responsible for some of the most popular headphones in the world. But why?

Celebrities.

Monster understands that the majority of consumers aren’t concerned with best-in-class audio technology, but rather style and status. Monster capitalizes on bright colors, cool designs, and (of course) celebrity endorsements.

And why not? Unless you’ve made audio quality a priority and purchased top-of-the-line headphones from brands like Sennheiser or Audio Technica, you might not even know what you’ve been missing.

After a hugely successful contract with Beats by Dre from 2009 to 2012, Monster has put even more focus on celebrity-designed lines of headphones. This was made clear at CES 2014.

Approaching the Monster booth, with walls of red velvet that reached from the floor to the ceiling, was like approaching a fortress. Most booths at CES are open, with a number of entrances at various corners to come in and check out the products. Not Monster.

There was only one entrance to the Monster booth, and you had to go through a viciously rigid press relations desk.

Once inside, you can smell the celebrity. Pictures of celebrities hung from every wall. Marshawn Lynch loves Monster. Drew Brees loves Monster. Nick Cannon and Tyson Beckford love Monster. And, lo and behold, they were standing fifteen feet from us, explaining to various members of the press how much they love working with Monster to develop their own line of headphones.

We did our own interviews with the male super model and Mr. Mariah Carey, and they both made one thing very clear: audio technology is not the focus here. These celebrities trust Monster to get that part right, and instead focus on style.

Nick Cannon’s line of Ntune and Ncredible headphones come in wild colors, with bubbly over-ear cans. Tyson Beckford’s line of Inspiration headphones are more sleek, with colors like champagne gold and rose gold, and interchangeable headbands.

We don’t often think of it this way, but headphone makers are the pioneers of wearable technology, and it seems that Monster and its army of celebrities have figured out that the key to wearables is style. Of course, technology has to be present â€" the Inspiration line lets you share music (wired) from one set of headphones to the next.

But at the end of the day, if someone is putting technology on their face or head or wrist, it better look good.

Sunday, January 12, 2014

Neiman Marcus Breach Could Be Part Of Larger Holiday Cyberattack On U.S. Retailers

In the weeks following Thanksgiving, Target became the unlucky victim of a massive attack and data hack, which reportedly affected as many as 110 million people and exposed an array of personal data, including names, addresses and credit card information. With a second retail giant beginning to notify customers that it, too, has been hacked, it seems that we may just be scratching the surface of a larger cyberattack that took place during the holiday season.

This morning, Krebs On Security reported that upscale retailer Neiman Marcus has teamed up with the U.S. Secret Service to investigate its own data breach which led to the theft of credit card and personal information. The company reportedly discovered the cyberattack in December from its credit card processor but has still yet to disclose how many shoppers have been affected by the hack.

However, the company said via its Twitter account that it is beginning to notify customers whose credit card information has been “used fraudulently” since the breach in December. The company said that the forensics team it has been working with had discovered that customer personal information had been compromised, but that it has “begun to contain the intrusion and have taken significant steps to further enhance information security,” it said in a statement about the breach.

Beyond how many of its customers were exposed to the attack, the company has yet to share details on how the breach occurred. There is no concrete evidence that the two attacks on Neiman Marcus and Target were linked, as, at least according to Krebs. Target has yet to publicly share details on its investigation which could help other retailers discover whether or not the attacks were perpetrated by the same hackers.

However, Reuters has since reported that Neiman Marcus and Target were not the only victims of the Holiday Hack Attack ’13, as I’m calling it. According to Reuters, at least three other “well-known U.S. retailers” were subject to data breaches, which used “similar techniques” to the attack on Target. Not only that, but those investigating the events indicated that similar breaches may also have “occurred earlier last year.”

The report claims that hackers used “malicious software” to infiltrate the retailers’ databases and steal credit card information. Reuters’ sources indicated that one of the Trojan horses used by hackers was a “RAM scraper,” which allows the burglar to snatch encrypted data at a moment of vulnerability. This happens when the data appears in plain text as it moves through the live memory of the customer’s computer, according to Reuters.

Visa apparently warned of a series of attacks using this method that had been attempted on its network earlier last year, but while this kind of “RAM scraping” attack has been around for years, the report said that the attacks on Target and others were much more sophisticated. While cyber security itself has increased dramatically (and improved) over the last few years, it appears there’s still headway to be made.

While the attacks reportedly took place during the holiday season, the major retailers affected have delayed any public announcement about the cyberattack. The reason is that many credit card companies and banks are “forbidden” from naming merchants affected by attacks unless “they disclose that information themselves.” Naturally, big brand merchants would rather protect their image and business, rather than publicly announcing a breach.

It’s an understandable move to protect their business and prevent mass hysteria, but it’s also frustrating to customers, banks and many others who may not become aware of exposure until days, weeks or months after the attacks occur. Many states require companies to contact customers when their information is exposed, and usually it’s payment processors who bear that responsibility. But that’s not the case everywhere.

As more information on this comes to light, we may learn that the hackers ran a series of test-runs of their new methods involving RAM scraping and other techniques, which could be (or could have been) a harbinger of things to come. We also may learn that a host of companies have been exposed to these sorts of attacks, even though those companies may resolve try to prevent that information from coming to light.

Image credit: SalFalko via Flickr