Techonomy http://techonomy.com Sat, 30 Aug 2014 20:38:53 +0000 en-US hourly 1 http://wordpress.org/?v=3.9.2 Techonomy Taps Detroit’s Magic on Sept. 16 http://techonomy.com/2014/08/techonomy-taps-detroits-magic-sept-16/ http://techonomy.com/2014/08/techonomy-taps-detroits-magic-sept-16/#comments Fri, 29 Aug 2014 17:54:08 +0000 http://techonomy.com/?p=18181 When Techonomy's Chief Program Director Simone Ross first proposed in late 2011 that we consider doing an entire conference in Detroit, I was a little confused. Detroit? Isn't Techonomy all about cutting edge, shiny, new, transformative technologies and the things being transformed? Why head to America's most distressed big city? But Simone convinced me to head there with her before Christmas that year and I, like her, became captivated. Techonomy is back in Detroit for our third annual Techonomy Detroit conference on Tuesday, September 16, because it turns out to be the perfect place for a "techonomic" discussion about a number of trends everybody needs to understand better.

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When Techonomy’s Chief Program Officer Simone Ross first proposed in late 2011 that we consider doing an entire conference in Detroit, I was a little confused. Detroit? Isn’t Techonomy all about cutting edge, shiny, new, transformative technologies and the things being transformed? Why head to America’s most distressed big city? But Simone convinced me to head there with her before Christmas that year and I, like her, became captivated.

Techonomy is back in Detroit for our third annual Techonomy Detroit conference on Tuesday, September 16, because it turns out to be the perfect place for a “techonomic” discussion about a number of trends everybody needs to better understand: rapid tech-driven change, the morphing of the American economy, the challenges facing cities as jobs shift rapidly, and the way that galloping innovation is outrunning the ability of policy-makers in cities, states, and the federal government to regulate or even understand what’s going on. It’s hard enough for any of us to understand. That’s why we do these conferences. They help.

So we open this year’s conference at Wayne State University with a weighty session on one of the biggest unanswered questions. What is the future of the “American dream”? Can the United States remain a society where hard work can routinely elevate ordinary citizens into the middle class? How are automation and robotics changing that equation? As one of our conference speakers said on a recent prep call, “First we had agriculture and then manufacturing to absorb the great middle. What will we have next?” How should our country respond to growing inequality and employment uncertainty? The session includes Carol Goss, a veteran Detroit activist who was until recently president of the Skillman Foundation, along with Philip Zelikow, a historian and Washington policy guru who is a managing director of the Markle Foundation’s Initiative for America’s Economic Future in a Networked World. We also include Elizabeth Shuler, the thoughtful secretary-treasurer of the AFL-CIO, and a member of the Markle initiative.

When I first mentioned to Jack Dorsey, founder of Twitter and Square, that we were planning a Detroit conference in January 2012, I’d barely gotten it out when he said, “I’m in.” It was catalytic to have his commitment. We are among many who are inspired by his passion for remaking America’s cities and belief in tech’s role. The initial impetus for Twitter was Dorsey’s idea that individuals should have the same connectivity to a network of peers as taxis and police cars have. He’s been obsessed with cities since he was a small boy. This year Dorsey is back in Detroit with us. He’ll be interviewed by the new CIO of the city of Detroit, Beth Niblock, a longtime government urban technologist.

Detroit itself is in the midst of an extraordinary transformation, and Niblock and her boss, mayor Mike Duggan, have a raft of impressive ideas about jumpstarting redevelopment with tech as an integral tool. Each time our Techonomy team goes to the city we come away impressed with both its awakening and the scale of its challenges. (We also come away wondering if we should grab some super-cheap real estate before what feels like the inevitable resurgence kicks in big time.)

Susan Crawford, one of the nation’s most thoughtful advocates for fairness in tech policy and author of a new book, “The Responsive City,” about how data can improve governance and community life, will be interviewed by Jennifer Bradley of the Brookings Institution, whose own book, “The Metropolitan Revolution,” about the rebirth of American cities, is a must-read. (She co-wrote it with Bruce Katz, who participated in sessions at past Techonomy Detroits). Then Brian Forde, a top tech official in the Obama White House, will appear with Zach Sims of Codecademy, the hugely successful online programming education tool, to talk about the nature of the changing workforce and how urgently the American economy needs to upgrade its talent pool. It’s an amazing group of speakers.

We’ve got potent sessions on urban innovation, the sharing economy, the connection between startups and cities, the future of marketing, even one on the importance of urban farming. Did you know that some experts believe that by 2024 there will be more than ample food for everyone on the planet, thanks to the efficiency of so-called “vertical farms” that may use LED lights with wavelengths optimized for specific crops? It’s the sort of thing we want our audience to go home musing about. That, along with perhaps the ways their company’s management, marketing, and product development needs to shift to accommodate the changing digitized economy.

Techonomy Detroit is two weeks from Tuesday. If you’re in southeast Michigan it’s a no-brainer. And if you’re elsewhere, it’s worth a trip. You’ll be amazed at what you find in Detroit and at this event.

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Techonomy Contests http://techonomy.com/2014/08/techonomy-contests/ http://techonomy.com/2014/08/techonomy-contests/#comments Fri, 29 Aug 2014 16:32:46 +0000 http://techonomy.com/?p=18167 We partnered with Ford and Magisto to create a unique contest for people who love their city and want to show off their inner Martin Scorsese. If you already have enough glamor in your life and want to skip the fast track to Hollywood, you can sign up for our Techonomy Detroit VIP contest. Just […]

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magisto_contest_social2 Techonomy-Detroit-VIP-Badge We partnered with Ford and Magisto to create a unique contest for people who love their city and want to show off their inner Martin Scorsese.

If you already have enough glamor in your life and want to skip the fast track to Hollywood, you can sign up for our Techonomy Detroit VIP contest. Just enter your name, company, and email address for a chance to win tickets to Techonomy Detroit, seats at our exclusive VIP speaker dinner at Detroit’s iconic Cliff Bell’s restaurant, snazzy limited-edition Techonomy t-shirts, and more! Click here for details.

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Why Amazon’s Newly-Bought Twitch Has Value http://techonomy.com/2014/08/amazons-newly-bought-twitch-value/ http://techonomy.com/2014/08/amazons-newly-bought-twitch-value/#comments Fri, 29 Aug 2014 14:14:37 +0000 http://techonomy.com/?p=18164 I'm not sure why Amazon is the one who wants to own Twitch, but it must be part of the merchant's desire to broaden more fully into online media and become a real network of entertainment and content. This elucidating review of a Twitch viewing experience from Re/code underscores several things: the uniqueness of the platform's interface and viewing experience, the immaturity of many of its users, and the power of the brand among those testosterone-fueled boys and young men. It could be a dicey property for a would-be decorous part of the global media landscape to manage, but Bezos thought it was worth a billion dollars, so anybody who wants to know where media is going needs to be alert to it. Read more at Re/code

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I’m not sure why Amazon is the one who wants to own Twitch, but it must be part of the merchant’s desire to broaden more fully into online media and become a real network of entertainment and content. This elucidating review of a Twitch viewing experience from Re/code underscores several things: the uniqueness of the platform’s interface and viewing experience, the immaturity of many of its users, and the power of the brand among those testosterone-fueled boys and young men. It could be a dicey property for a would-be decorous part of the global media landscape to manage, but Bezos thought it was worth a billion dollars, so anybody who wants to know where media is going needs to be alert to it.

Read more at Re/code

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Governments and Sharing: Lessons from the UK’s Beyond Jobs Project http://techonomy.com/2014/08/governments-sharing-lessons-uks-beyond-jobs-project/ http://techonomy.com/2014/08/governments-sharing-lessons-uks-beyond-jobs-project/#comments Thu, 28 Aug 2014 14:11:51 +0000 http://techonomy.com/?p=18146 What can governments do to boost the sharing economy? What would be their incentive to do so? Where are the commercial opportunities if public policy were to fully embrace sharing transactions? I have spent 20 years writing, consulting, and overseeing publicly funded projects based on these questions. The answers in brief: governments are potentially the biggest buyers of fragmented labor, its regulators, setters of tax/welfare codes, administrators of databases of record, and ideally will serve as marketing machines for economic initiatives.

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(Image via Shutterstock)

(Image via Shutterstock)

What can governments do to boost the sharing economy? What would be their incentive to do so? Where are the commercial opportunities if public policy were to fully embrace sharing transactions?

I have spent 20 years writing, consulting, and overseeing publicly funded projects based on these questions. The answers in brief: governments are potentially the biggest buyers of fragmented labor, its regulators, setters of tax/welfare codes, administrators of databases of record, and ideally will serve as marketing machines for economic initiatives. Aligning all this with a vision for the most efficient sharing economy imaginable could profoundly reshape this emerging sector.

Would policymakers do this? Jobs are diminishing; voters need all the earnings opportunities they can get. Too much “sharecon” activity is untaxed and illegal, needing to be tempted into the mainstream economy. So, yes, they might. What’s in it for the private sector? A chance to leverage official facilities, enable billions in new economic activity, profit from the creation of new platforms, then take a cut of each transaction.

Britain’s government has blazed this trail. Since 2005, administrations of right and left in Whitehall and local authorities have provided sustained funding to build a new generation of marketplaces for all kinds of irregular work in communities. The resulting technology and learning are now embedded in the Beyond Jobs project. Now we are talking with other governments and building partnerships with big technology players who could deliver this kind of system at the enormous scale required.

UNIVERSAL SHARING

At Techonomy 2013, Jennifer Bradley of the Brookings Institution outlined a pressing need for sharing to be as accessible, enticing, and rewarding as possible. That’s a huge technological challenge. Hiring a babysitter or a barista to work in your café over the lunchtime rush, or renting a barbecue or a bike for the afternoon are among the most complex transactions in any market anywhere. That’s doubly so if each purchase is to be made compliant with tax and regulations. But these purchases are low value.

In Britain we have been building, testing, and modifying core sharecon technology for years. The idea is to make sharecon transactions as instant, low overhead, and reliable as buying a product on Amazon. One key concept we have pioneered at Beyond Jobs is something we call a “Central Database of Available Hours” (CEDAH). It would be a horizontal, government-sponsored platform that can underpin thousands of verticals trading the spare hours of people or their possessions. Data on local patterns of supply/demand/pricing in any vertical can be aggregated for users and potential users. If required, it can pull together purchases from multiple verticals to assemble a package of requirements for a customer.

The "availability intake" tool on the Beyond Jobs platform

The “availability intake” tool on the Beyond Jobs platform

This so-called CEDAH platform could handle the hugely complex mechanics of matching, pricing, and ensuring completion in any transaction involving ad hoc local hire of a person or resource. Ideally, it will interface with a range of official databases. CEDAH is designed to sit seamlessly within any website in the way credit card processing modules do now, funding itself through a small transaction charge. It is a government’s way of tempting these fiddly, time-consuming, uncertain transactions into the mainstream economy.

BARRIERS TO UNIVERSAL SHARING

The need is there. The technology works. The business case is solid. Why haven’t we moved to a universal platform to underpin the sharing economy? Two factors stand in the way:

1) Long-term economic opportunity for the public comes from very wide-scale, low-margin, devolved markets. But short-term profitability for operators requires high markups in a tight vertical aggressively aimed at owning both buyer and seller. Witness Airbnb’s valuation for achieving domination of the spare-bed market. Or, TaskRabbit’s recent pivot to a narrower focus. VC money is pouring into these highly focused verticals. The possibility of that model being disrupted can be unthinkable for many people driving the sharing economy forwards.

2) Governments are key to instigating a low-cost, huge-scale universal model. But anything that smacks of workforce “casualization” is a third-rail issue for politicians. To understand why, look at how vested they are in traditional forms of employment. The UK, for example, spends around £5 billion ($8.3 billion) a year on blue-collar job creation. This, despite our flagship program having a reported success rate of only 3.5 percent. Like many countries, we now have an official database of available jobs set up in competition with private job boards. Job creation figures for the U.S. will be many times higher, but harder to quantify because spending is less centralized. The American Job Center system  also seeks to aggregate private sector efforts in this vital part of the economy.

It can be hard for outsiders to grasp how unnerving any perceived challenge to job creation can be in corridors of power. Recently a veteran employment minister in a developed country asked me, following detailed discussions on the topic, if we could get back in touch after the next election. Raising the subject of an official boost for ad hoc working before then would be dangerously off-message as rival politicians are assuring the electorate of renewed job creation efforts.

CHANGE IS COMING

But potent forces are undermining political attachment to traditional employment. Recovery from the 2008 crash in Europe and the U.S. is leaving blue-collar households behind. Real wages are falling. Millions are scrabbling for whatever earning possibilities they can get. The sharing economy is growing rapidly. It largely leaves buyers and sellers responsible for tax and regulatory compliance. There seems to be widespread ignorance of the implications by users. Sharing sites with millions of users can be a tempting portal into illegal activity for many citizens.

Expect policymakers to progressively accept that irregular working is the new normal. They are likely to start pulling levers and directing public spending in ways that reward longer-term, wider-scope sharecon ventures. And that’s where the big technology companies come in.

Policymakers may be sensitive about employment issues. But they are typically horror-struck at any hint of an ambitious public sector IT program. (Hello, Obamacare exchanges in the U.S. and Universal Credit systems in Britain.) A system like CEDAH shouldn’t be funded, designed, or run by government. Like national lotteries, it can be initiated through a concession to commercial operators who bear the risks in return for rewards that—with good execution—can be extremely attractive.

Taxpayers can be insulated from the costs of implementation. But there is worry about reputational risk. Is something as sophisticated as CEDAH a recipe for political embarrassment? At Beyond Jobs we are now keen to dialogue with technology majors who have the track record to take our type of systems and all the learning to vast scale. Convincing politicians that implementation is achievable is step one. Then we need to invite major financial institutions to build their business case for this latest public infrastructure investment opportunity. What markup would they charge if given a concession to finance the building and operation of CEDAH?

Like it or not, governments are the sleeping giant of the sharing economy. History suggests they will wake up. Look at fundamental technologies like electricity, rail, water supply, and broadcasting. All started with an uncoordinated pioneering stage of multiple service, regulatory, and business models. All moved to standardization and universality after policy was aligned with a vision for their potential. There is demand in the legitimate economy for irregular local hires that could total an additional 5 percent of GDP, all directed at people who need it most. Helping leaders at city, regional, or national levels see that it can be unleashed by the right platform is a challenge waiting for the tech sector.

Wingham Rowan is the Director of Beyond Jobs.

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Making Dumb Things Smart http://techonomy.com/2014/08/making-dumb-things-smart/ http://techonomy.com/2014/08/making-dumb-things-smart/#comments Wed, 27 Aug 2014 13:53:48 +0000 http://techonomy.com/?p=18132 Our physical world is now technology-enabled by the digitization of everything from books to movies to tools—such as the flashlights, cameras, calculators, day planners, music players, and bus schedules that now reside on our smartphones. The Internet and digital technology is most powerful when it is married back into our physical world; when atoms and bytes converge. This intersection also happens to be the source of greatest potential for the Internet of Things (IoT). For the past several years, we’ve heard and talked a lot about how smart things are getting smarter through Moore’s law and the exponential advances in core digital components.

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In the move from bits to atoms, people will be the glue.

(Image via Shutterstock)

(Image via Shutterstock)

“Complexity is cheap now,” says Ted Hall, CEO of ShopBot Tools, which designs and manufactures digital fabrication tools priced for individuals and smaller manufacturing shops. “And quality is almost free.”

Indeed, big shifts are happening in how things get made and where value is created. And digital technologies aren’t just impacting production and manufacturing; they’re changing the physical world.

Our physical world is now technology-enabled by the digitization of everything from books to movies to tools—such as the flashlights, cameras, calculators, day planners, music players, and bus schedules that now reside on our smartphones. The Internet and digital technology is most powerful when it is married back into our physical world; when atoms and bytes converge. This intersection also happens to be the source of greatest potential for the Internet of Things (IoT).

For the past several years, we’ve heard and talked a lot about how smart things are getting smarter through Moore’s law and the exponential advances in core digital components. We’ve seen two decades of significant disruption of industries, led by music and publishing. Virtual seemed to be the endpoint. But bits and bytes aren’t the end goal; they are just the means to better discover, use, or manipulate the physical environment.

Embedded within those smart advances is the opportunity to make dumb things, physical things, smarter. Smart technology is being harnessed in technologies such as 3D printing, biosynthetics, and gene sequencing and is enabling a range of new companies and trends, including both Uber and the Maker Movement.

We already see the effects of digital tech on the effective utilization of physical assets—whether they’re owned by individuals or companies. This efficiency may be achieved in a number of ways, like improving “up-time” for a costly machine that has become self-correcting, or by renting out excess capacity to external parties to generate new revenue streams.

Digital technology can locate a car and deliver it to our feet when we need a ride. It matches a spare bed looking for income with an individual in need of a place to stay. It lets us find and modify a design rather than create one and then lets us use a manufacturing-grade tool to execute the design, with limited skill or invested time. The pavement we drive on becomes smarter with sensors that communicate traffic information; heavy earth-moving equipment becomes smarter when sensors monitor tire wear to reduce the risk of down-time. Smart materials can collect and conduct information for the clothing a runner wears or the pipe that water flows through. All of these examples require a degree of human intervention to make them useful, and the next step has seemed to be eliminating the human intervention.

Tech-enabled physical objects are starting to be able to adapt or take action automatically. Think of the anti-skid technology or collision-avoidance features in a car, a set of components communicating with each other and taking action as a result. That type of real-time adjustment and feedback that eliminates or reduces the need for human intervention has begun to extend into larger systems, like wind turbines and complex machinery interacting within a processing plant.

Self-correction and automated load adjustment increases efficiency. That’s good, but we believe there will be far more value unlocked when that information can be fed back to humans for pattern analysis and systemic intervention. Consider exceptions—those one-off shipping requests or customer events that don’t fit into standard processes and consume inordinate amounts of a worker’s time. Over time, information from dumb objects could provide a picture of how and when expensive exceptions occur, revealing patterns that lead to insights. Then, rather than just figuring out a more efficient way to respond to each exception, companies can rethink the process or system to eliminate the causes of exceptions.

The goal is to pull all of the data back into a human sphere where people can add value. We haven’t yet seen good examples of this, but imagine a beverage company that faces fairly frequent stock-outs that cause customer dissatisfaction and lost sales. A year’s worth of data shows that the stock-outs typically occur in conjunction with local and hyper-local events. Now the company has the opportunity not only to track and respond to stock-out situations faster, but to program the inventory-replenishment system to cross-check with event calendars, weather reports, and Twitter feeds to prepare. Companies’ skills in tapping use data will determine the data’s value, but the potential is greater than just cost efficiencies.

This intersection of bits and atoms fed back to humans is of particular interest to anyone trying to create value within the IoT. When we start to integrate bits and atoms, we create an avalanche of data. The challenge and opportunity for those interested in the IoT is going to be finding the best way to analyze that data and create new value and insights from the collision of disparate data.

The movement from atoms to bits and back to atoms creates a paradox. It creates a temptation to throw in with one or the other: It is a world of atoms; It is a world of bits! Resist the temptation to focus on one or the other. Rather it is where bits collide with atoms that real value and opportunity will be found.

John Hagel III, director at Deloitte Consulting LLP, is the co-chairman of the Deloitte Center for the Edge, based in Silicon Valley. John Seely Brown is the independent co-chairman of the Deloitte Center for the Edge.

 

 

 

 

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Scripps Bio-Chemist Romesberg: Proteins and Enzymes Could Transform Industry and Medicine http://techonomy.com/2014/08/scripps-bio-chemist-romesberg-proteins-enzymes-transform-industry-medicine/ http://techonomy.com/2014/08/scripps-bio-chemist-romesberg-proteins-enzymes-transform-industry-medicine/#comments Wed, 27 Aug 2014 13:41:09 +0000 http://techonomy.com/?p=18121 How can a better understanding of evolution help us improve human health? Renowned bio-chemist Floyd Romesberg of the Scripps Research Institute can think of a few ways. For one, cancer cells evolve and grow by “out-competing” neighboring cells, a process Romesberg calls “evolution just run faster than we’re used to.” We spoke to Romesberg at our recent Techonomy Bio event in Mountain View, Calif. He says understanding how our genomes have evolved will give us insights into the genetic diseases we get, and help us treat them. But to fully comprehend the evolutionary process, we have to look at proteins. “Understanding how proteins function is absolutely essential to our understanding of life,” said Romesberg.

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How can a better understanding of evolution help us improve human health? Renowned bio-chemist Floyd Romesberg of the Scripps Research Institute can think of a few ways. For one, cancer cells evolve and grow by “out-competing” neighboring cells, a process Romesberg calls “evolution just run faster than we’re used to.” We spoke to Romesberg at our recent Techonomy Bio event in Mountain View, Calif. He says understanding how our genomes have evolved will give us insights into the genetic diseases we get, and help us treat them. But to fully comprehend the evolutionary process, we have to look at proteins. “Understanding how proteins function is absolutely essential to our understanding of life,” said Romesberg. When it comes to creating what Romesberg calls “novel” reactions—processes we want to catalyze for medical or industrial purposes—a lot of progress has been made in artificial enzymes. “Enzymes are unbelievable machines. They’re able to catalyze reactions to go billions and billions and billions times faster than they otherwise would.” Harnessing the power of enzymes and proteins, Romesberg believes, could be game-changing.

If you actually followed all of that and you’re ready for the graduate-level course, check out this session from our Bio conference.

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Detroit’s Chalkfly Brings Social Good to Office Supplies http://techonomy.com/2014/08/detroits-chalkfly-brings-social-good-office-supplies/ http://techonomy.com/2014/08/detroits-chalkfly-brings-social-good-office-supplies/#comments Tue, 26 Aug 2014 19:58:16 +0000 http://techonomy.com/?p=18110 Andrew and Ryan Landau attended rival universities in Michigan, then left the state after graduation to pursue jobs at Google and IBM. But the pull of home, and the prospect of being part of a burgeoning entrepreneurial renaissance, brought the brothers back to Detroit to launch an innovative e-commerce company. Chalkfly, their fast-growing two-year-old office-supply e-commerce company, lets users donate 5 percent of each sale directly to teachers. Andrew calls the chance to work with his brother and be part of Detroit's revitalization an opportunity he couldn’t pass up.

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In anticipation of our Techonomy Detroit conference on September 16, we are profiling Detroit-area tech startups that are driving the city’s re-emergence as a center of innovation. (To register for the conference, click here.)

Chalkfly co-founders Ryan (left) and Andrew Landau

Chalkfly co-founders Ryan (left) and Andrew Landau

Andrew and Ryan Landau attended rival universities in Michigan, then left the state after graduation to pursue jobs at Google and IBM, respectively. But the pull of home, and the prospect of being part of a burgeoning entrepreneurial renaissance, brought the brothers back to Detroit to launch an innovative e-commerce company.

Chalkfly, their fast-growing two-year-old office-supply e-commerce company, lets users donate 5 percent of each sale directly to teachers. Andrew calls the chance to work with his brother and be part of Detroit’s revitalization an opportunity he couldn’t pass up. Andrew Skyped with Techonomy about Chalkfly’s growth, why the business model integrates a charitable component, and Detroit’s path to renewal.

What was the idea behind building social good into your business model?

I believe that doing good is good business. If you really focus on company culture, making a difference, and making technology become part of something larger, you can create a successful business.

Which came first: the idea to create an online store for school supplies, or the charitable aspect?

They are two concurrent lines. From the business standpoint, office supplies is a $45 billion industry. It is not very exciting or interesting, but we thought it offered a great opportunity. Big-box stores have 1,500 stores and 30,000 employees. They just aren’t focused on innovation. Here was an opportunity to really change the shopping experience.

Also, we wanted to do something where we could be involved with the community. Our mom was a teacher, so education is really important to our family. From a company culture standpoint, we wanted to create a business that is not only successful financially, but could impact a community as well.

How has business been?

We currently have 50,000 products, 24/7 Michigan-based customer service, free overnight shipping, and a 365-day return policy. Everything we do is focused on the customer.

We launched in July 2012. In March 2013, Detroit Venture Partners, Ludlow Ventures, Start Garden, Griffon Ventures, and Bizdom led a $750,000 round. In 2012 we did just under $100,000 in revenue, and last year we finished with over $2 million.

We were the youngest company in Internet Retailer’s Second 500 list, which names the fastest growing e-commerce companies in the country. We have been lucky to have thousands of customers in all 50 states who can get the products they want, save money, and make a difference.

Staying in Detroit was important to you. How has it been expanding to a national market?

One of the benefits of being a tech and e-commerce company is that there is an opportunity to reach anyone who has an Internet connection. We felt being in Detroit would be a good investment for us because there is an amazing talent pool, an incredible attitude, and an entrepreneurial spirit. But in terms of our ability to get customers, we wanted to change the dynamic of office supplies for the rest of the country.

Do you think the charitable component has attracted consumers and contributed to your fast growth?

For customers around the country, there is an opportunity to be a part of something bigger and to make a direct connection to the community. I really believe that people want to do good and want to support education, and this is an easy way to do it.

We also just have an incredible team. Last year we were ranked one of the 15 best startups to work for in America by Business Insider. Our success and growth are directly connected to the people we have. At our company there is such a focus on culture, collaboration, and communication. I really believe if you treat people the right way and you have the right company attitude, anything can be done.

Do you see the company expanding to other verticals?

We want to continue to attract the best and brightest to be part of what is happening in Detroit. If people are thinking about purchasing school or office supplies, we want them to come to Chalkfly. We think customer-oriented technology combined with a true message of giving back with social good is the future for business. We have the right ingredients, so it is really about continuing the sprint.

Our approach is very customer driven. If there are customers who want a certain product and we are able to offer it under our value proposition, then we will go ahead and do it. But it is very important for a startup to stay focused, so it’s not about selling anything to anyone. But if we can do it, then we will be happy to look into it.

What’s the business atmosphere like in Detroit right now?

In the past 18 months, there really has been an acceleration of entrepreneurs starting businesses, capital coming into the community, and people becoming aware of it. If you are not from Michigan you may not understand what is happening in Detroit, but once you are here, once you talk to the other people, once you are in a coffee shop, there is a real energy here. You wouldn’t expect it, but once you are here this is something you would want to be a part of. It is good for business to be based out of Detroit. People who are in Detroit choose to be in Detroit. Those who work in a startup or start a company really want to be here. Everyone is helping each other, asking, “Who can I connect you with to help your business progress?” Our best team members, best clients, best relationships have been directly through other relationships that we have developed, and people who have really wanted to help us. There is a spirit here that is different from anywhere else in the country.

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Are Scientists Selfish? http://techonomy.com/2014/08/scientists-selfish/ http://techonomy.com/2014/08/scientists-selfish/#comments Mon, 25 Aug 2014 12:43:46 +0000 http://techonomy.com/?p=18087 We often hear that scientists hoard data, refusing to share information even when doing so might speed advances to patients in dire need. It’s not just about sharing results on the fly—once a project has been completed and findings published in a journal, most of us observers outside major institutions still can’t get access due to expensive subscriptions. The situation is made all the more unpalatable since most biomedical research is funded by taxpayer dollars. Yet the average taxpayer has little ability to see what comes of that funding.

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(Image via Shutterstock)

(Image via Shutterstock)

We often hear that scientists hoard data, refusing to share information even when doing so might speed advances to patients in dire need. (We touched on it briefly in this piece and it was a major element in a recent article in The New Yorker.) It’s not just about sharing results on the fly—once a project has been completed and findings published in a journal, most of us observers outside major institutions still can’t get access due to expensive subscriptions. The situation is made all the more unpalatable since most biomedical research is funded by taxpayer dollars. Yet the average taxpayer has little ability to see what comes of that funding.

So do all these factors mean we have a community of selfish scientists? The simple answer is no. The more genuine answer is: It’s complicated. The institutional inertia of the established scientific community strongly favors researchers who go along with the data-hoarding norms.

Consider the path of your typical life-science researcher, fresh out of grad school: Jane Scientist, a newly minted PhD in a sea of PhDs so vast there aren’t enough jobs for all of them. After landing a low-level gig in somebody else’s lab, she works to improve her lot by pitching in on as many projects as possible. She hopes some of them will result in a publication—the currency of advancement in science. With her name on enough papers, Jane may eventually be able to set up her own lab, where she will immediately face the challenge of having to raise money to keep that lab, because universities don’t cover that. Getting grants is linked to her publication history, since reviewers combing through five times more applications than they can fund want to make sure a winning scientist has a reputable work history. It is so difficult to win that initial grant that some funding agencies have a special piggybank just for first-timers so they don’t have to compete against established labs. Indeed, the average age at which a scientist wins her first grant in the U.S. has crept past 40. It’s not a career for the instant-gratification type.

The publish/get funding/publish again cycle will last throughout Jane Scientist’s career. If she brings in enough money to support her lab, and if she authors enough papers, and if those papers are in top-tier journals—then our friend gets a shot at tenure at her university, which offers a bit of relief from the constant panic.

Throughout Jane’s path, there are twin themes: the need for papers and the need for funding. Papers that come out in less-respected journals don’t help, so the top publications have an essential stranglehold on the market. This handful of journals—the Ivy League of publications—gets to make rules that suit them best, and those rules often prohibit scientists from releasing data prior to publication. Offer too many details in a conference presentation, get a little too talkative with a journalist, and these top journals may no longer consider your paper. The journals want exclusivity, and they want to break your research news for you.

In a field where scientists vie for scarce funding, the threat of being passed over by a top outlet effectively shuts down data-sharing prior to publication. What about access after the fact? Indeed, many scientists want to publish in open-access journals, like those run by the Public Library of Science, that let anyone read the contents without a subscription. But there are two gotchas. First, such open-access publications are newer and therefore tend to be considered less prestigious by grant committees and tenure reviewers, so well-intentioned scientists aren’t rewarded for open-access papers the way they would be if they scored a traditional publication. Second, business models to support open-access publications are still evolving—after all, the money to fund these outlets has to come from somewhere—and today many of them charge the scientists a fee to make the paper open access. That fee is usually covered by grant money, so taxpayers are still paying to get access to these papers, it’s just less visible than a publication firewall.

Outside of the life sciences, there’s been far more success in data sharing. Physicists routinely share data before publication, and early versions of their papers are made publicly available even before they’re accepted by a journal. (It is perhaps worth noting that life science advances are more likely to become useful intellectual property than physics advances.)

We are starting to see some biologists adopt these methods, often led by those who have tenure or guaranteed institutional funding to insulate them from the publish-or-perish cycle. Individually, no single scientist can upend a system that has been established over centuries; those who try may wind up starving their own labs and leaving the field.

What’s really needed is system-wide change. Some funding agencies have begun to require grant winners to ensure their publications become publicly accessible after a certain period of time, but those requirements need to be strengthened and should take effect immediately upon publication rather than six months or a year later. More importantly, the science community needs a better way to evaluate journals—one that doesn’t put such a premium on history—so that open-access publications and outlets with more open-minded approaches to data sharing are finally on an even playing field with traditional journals.

Only when they can fairly choose to share data without risking their careers will we see what scientists are really made of.

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Could Reprogrammed Cells Fight “Untreatable” Diseases? http://techonomy.com/2014/08/reprogrammed-cells-fight-untreatable-diseases/ http://techonomy.com/2014/08/reprogrammed-cells-fight-untreatable-diseases/#comments Fri, 22 Aug 2014 14:34:12 +0000 http://techonomy.com/?p=18082 Jeanne Loring and her Scripps Research Institute colleagues transplanted a set of cells into the spinal cords of mice that had lost use of their hind limbs to multiple sclerosis. As the experimentalists expected, within a week, the mice rejected the cells. But after another week, the mice began to walk.
"We thought that they wouldn't do anything," says Loring, who directs the Center for Regenerative Medicine at Scripps. But as her lab has since shown numerous times, something that these particular so-called "neural precursor cells" do before the immune system kicks them out seems to make the mouse better.

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Loring (front row, center) and her team at the Center for Regenerative Medicine. (Image via www.scripps.edu)

Loring (front row, center) with the Loring Lab Group at the Center for Regenerative Medicine (image via www.scripps.edu)

Jeanne Loring and her Scripps Research Institute colleagues transplanted a set of cells into the spinal cords of mice that had lost use of their hind limbs to multiple sclerosis. As the experimentalists expected, within a week, the mice rejected the cells. But after another week, the mice began to walk.

“We thought that they wouldn’t do anything,” says Loring, who directs the Center for Regenerative Medicine at Scripps. But as her lab has since shown numerous times, and published in Stem Cell Reports, something that these particular so-called “neural precursor cells” do before the immune system kicks them out seems to make the mouse better.

The cells Loring’s team used are derived from induced pluripotent stem cells, which are mature cells, such as skin cells, that have been coaxed with a combination of chemicals to return to an earlier stage of development.

Induced pluripotent cells, also known as iPS cells, pose a number of opportunities for medicine. For instance, Loring is using iPS cells from Parkinson’s disease and multiple sclerosis patients to reconstitute cell types that may be damaged in people with those conditions. She is also using them to test how certain drugs or treatments may affect damaged cells in people with conditions such as autism spectrum disorders.

Loring says no viable long-term treatments exist for the diseases her team has been working on, including Alzheimer’s disease, Parkinson’s disease, and multiple sclerosis, “That’s where the need is,” she says.

The neural precursor cells that Loring has been using in the mice with MS are young cells that haven’t quite gotten to the point of being nerves yet. Only certain types of these cells have such a dramatic Lazarus-like effect on the affected mice, but Loring’s team can readily identify them based on DNA analysis.

Even so, they’re not yet ready to treat human MS patients with the approach, she says. First, the researchers want to identify what the cells produce—a protein, perhaps, or a set of proteins—that allows the mice to walk.

For other diseases, however, researchers are closer to being ready to transplant working versions of reprogrammed cells into sick people.

For instance, Loring is exploring whether it’s possible to reprogram skin cells from patients with Parkinson’s disease so they turn into iPS cells and then into working dopamine neurons, which are the cells affected in the disease.

It seems to work in animals: Loring’s lab has transformed skin cells from eight human Parkinson’s disease patients into iPS cells and transplanted them as neurons into animal models.

A local Southern California Parkinson’s disease association has funded the research so far. Now Loring and colleagues are seeking additional funds to move through regulatory approval and toward the clinic.

Meanwhile, iPS cells separately suggest a way to test how disease-affected cells may or may not respond to treatment in diseases like autism, by in effect creating “dummy” cells on which drugs could be tested.

After making iPS cells from the cells of fragile X syndrome patients, a genetic condition that often co-occurs with some forms of autism, Loring’s lab turned them into cortical neurons—cells that she suspects don’t develop as they should in people with the disorder.

Indeed, the cortical neurons her lab grew from those iPS cells looked different than other cortical neurons and suffered delayed development. These neurons, she explains, could be used to test different molecules and compounds to see whether drugs could treat cells affected by autism.

This sort of approach, in which so-called “derived cells” are used for drug screening, Loring said, is the likely way that iPS cells will first be used in medicine, especially as more and more people have their genomes analyzed. Treatment with reprogrammed iPS cells will take longer to develop.

Loring says she hopes soon to be able to set up simple assays “that will allow us to find out what sort of drugs will work for people with particular genotypes.” That could offer a significant boost to drug development. iPS cells are an important new opportunity to attack diseases that otherwise have vexed researchers and doctors for decades.

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New Economics: Sharing Isn’t Free, and Price Gouging Isn’t Mean http://techonomy.com/2014/08/sharing/ http://techonomy.com/2014/08/sharing/#comments Fri, 22 Aug 2014 13:31:41 +0000 http://techonomy.com/?p=18044 The pros and cons of the so-called "sharing economy" are getting plenty of press these days. Consider the diverse takes this week from Technology Review, the New York Times, and the Kansas City Star. In a Times report about workers who are finding "both freedom and uncertainty" in the contract employment trend, Natasha Singer explains how Navy veteran Jennifer Guidry attempts to help cover her family's food and rent costs with popup gigs. Read more at The New York Times

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shutterstock_183488666

(Image via Shutterstock)

The pros and cons of the so-called “sharing economy” are getting plenty of press these days. Consider the diverse takes this week from MIT Technology Review, the New York Times, and the Kansas City Star.

In a Times report about workers who are finding “both freedom and uncertainty” in the contract employment trend, Natasha Singer explains how Navy veteran Jennifer Guidry attempts to help cover her family’s food and rent costs with popup gigs. Guidry offers taxi rides in her own car to strangers who ping her through one of three rides-haring apps, completes chores for customers who book her through TaskRabbit, and serves as private chef for Craigslist clients.

Flexibility, variety, and independence are all noted benefits of gig work. But Singer points out that, contrary to the notion that the entrepreneurial-minded are making “extra” income in their spare time on sharing economy gigs, people like Guidry, who lack any steady income source, are cobbling together unpredictable wages earned at unpredictable hours to survive. Singer calls them “microearners”:

“They often work seven-day weeks, trying to assemble a living wage from a series of one-off gigs. They have little recourse when the services for which they are on call change their business models or pay rates. To reduce the risks, many workers toggle among multiple services.”

One economist told Singer: “If you did the calculations, many of these people would be earning less than minimum wage. You are getting people to self-exploit in ways we have regulations in place to prevent.”

Still, “peer marketplaces democratize luxury services,” Singer says, offering “a good deal for consumers.”

Not all consumers agree. MIT Technology Review contributor James Surowiecki explains how Uber implements “dynamic pricing,” which some customers see as price gouging. The rideshare company got bad press last year, for instance, when it multiplied it usual rates by six or more in Manhattan during bad weather.

But Surowiecki says consumers misconstrue the practice. Uber’s method is not so much about reeling in higher fees when services are in demand; instead it’s about increasing supply to satisfy all customers. He writes:

“When there are more would-be Uber passengers than available Uber cars, the company’s algorithm sets a price that balances supply and demand. Uber’s algorithm (which it has been refining since 2011) is the company’s greatest asset and most significant innovation, allowing it to find the price that will attract drivers—whom, as independent contractors, it can’t order onto the road—without alienating customers.”

Surowiecki points out that dynamic pricing has been around a long time, but is usually presented by industries with limited supply–airlines, hotels, and rental car agencies, for instance–as discount pricing when supply is high, instead of surge pricing when supply is low. Reframing the practice could be all it takes for Uber to get back in favor with sharing economy fans.

And then there’s someone taking the term “sharing” literally. What’s a potential Uber customer who doesn’t want, or can’t afford, to pay? A hitchhiker. In Lawrence City, Kansas, Jenny O’Brien has created an app to bring back the practice–long ago outlawed in her town–by taking the danger and mystery out of it. As the Kansas City Star’s Brad Cooper reports:

“O’Brien’s service fits neatly into ecosystem of the sharing economy. She’s trying to make use of one of the most wasted resources of all: car seats.

Nearly 80 percent of Douglas County residents drive to work alone. That’s a lot of empty cars that might be used to save gas, prevent more wear on the highway and preserve the planet from noxious fumes.

‘You can see all those cars driving by as potentially tiny little buses if we can just get people in the mindset to open their vehicles to others,’ O’Brien said.”

Sure, but what will it mean for drivers relying on gigs in the sharing economy?

Read more at The New York Times

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Be a Techonomy Detroit VIP! http://techonomy.com/2014/08/techonomy-detroit-vip/ http://techonomy.com/2014/08/techonomy-detroit-vip/#comments Thu, 21 Aug 2014 21:03:39 +0000 http://techonomy.com/?p=18055 Here’s your chance to be treated like a VIP at the upcoming Techonomy Detroit event that will take place at Wayne State University on September 16th. Enter your name, company, and email address below for a chance to win a VIP package that includes: (2) Complimentary Tickets (2) Invitations to the exclusive VIP Speaker Dinner […]

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Here’s your chance to be treated like a VIP at the upcoming Techonomy Detroit event that will take place at Wayne State University on September 16th.

Enter your name, company, and email address below for a chance to win a VIP package that includes:

Techonomy-Detroit-VIP-Badge

  • (2) Complimentary Tickets
  • (2) Invitations to the exclusive VIP Speaker Dinner (September 15th)
  • (2) Techonomy Limited Edition T-Shirts
  • Backstage and Speaker Green Room Tour on the day of the event
[contact-form]

The winner will be notified on or about Monday September 8th.  To guarantee your seat, REGISTER HERE and if you are the winner of the contest, your ticket price will be refunded.

 

Official Rules for the Techonomy Detroit VIP Contest  

No purchase necessary: A purchase will not increase your chances of winning the Techonomy Detroit VIP contest (“Contest”).

Eligibility: The Contest is open to legal residents of the 50 United States and Washington, DC, who are 18 years of age or older as of September 15, 2014. The Contest is void where prohibited.

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Contest Sponsor, Administrator, and Prize Provider: Techonomy Media, 20 West 22nd Street, New York, NY 10010

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Prize: consists of:
(2) Complimentary Tickets to Techonomy Detroit
(2) Techonomy Detroit T-Shirts
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Backstage and Speaker Green Room Tour on the day of the event

Prize Drawings / Winner Notification / Odds: One winner will be selected on or about September 8, 2014, from all entries received during the Contest Period. Winner may not substitute or transfer prize. Prize may not be redeemed for cash. Odds of winning depend on the number of eligible entries received during the Contest Period. Winner will be notified by e-mail on or about September 8, 2014. If a winner cannot be contacted within one (1) calendar day of first notification attempt or if any winner rejects his/her prize, prize will be forfeited and an alternate winner selected.

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Other Terms and Conditions: Contest Administrator, in its sole discretion, may disqualify any entrant from participation in this Contest, and refuse to award any prize, if entrant engages in any conduct Administrator deems to be improper, unfair, or otherwise adverse to the operation of the Contest. If, for any reason, the Contest is not capable of running as planned, Administrator reserves the right at its sole discretion to cancel, terminate, modify, or suspend this Contest and select a Potential Winner for the affected Weekly Entry Period from entries received prior to the action taken or in such other manner as Administrator may deem fair and appropriate. Contest Sponsor and Administrator assume no liability and are not responsible for, and entrant hereby forever waives any rights to any claim in connection with, lost, late, incomplete, corrupted, stolen, misdirected, or delayed entries; or for any computer, telephone, wireless phone, cable, network, satellite, electronic, internet hardware, or software malfunctions; or unauthorized human intervention; or the incorrect or inaccurate capture of entry or other information, or the failure to capture any such information. Sponsor and Administrator assume no liability and are not responsible for, and you hereby forever waive any rights to any claim in connection with, errors and/or ambiguity: (a) in the Contest; (b) in any related advertising or promotions of this Contest; and/or (c) in these Official Rules. In the event of any ambiguity(s) or error(s) in these Official Rules, Administrator reserves the right to modify these Official Rules for clarification purposes or to correct any such error(s) without materially affecting the terms and conditions of the Contest.

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Winner: For name of Winner, send a US Postal Service postcard before 9/15/2014 with your name and return address clearly written to: Techonomy Media, 20 West 22nd Street New York, NY 10010. The name of the Winner may also be posted on Techonomy.com.   

 

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Apple, Samsung Face China Telco Freeze-out http://techonomy.com/2014/08/apple-samsung-face-china-telco-freeze/ http://techonomy.com/2014/08/apple-samsung-face-china-telco-freeze/#comments Wed, 20 Aug 2014 16:06:39 +0000 http://techonomy.com/?p=18023 Cost-cutting pressure is putting a squeeze on China’s three big telcos, creating an unusual set of conditions that could claim smartphone giants Samsung and Apple as victims. The latest signs of trouble for the world’s two largest smartphone makers comes in the form of an article in the English language China Daily newspaper, calling on China’s big three mobile carriers to stop offering packages with Samsung and Apple smartphones and instead only offer models from domestic manufacturers like Lenovo, ZTE, and Huawei.

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Mobile phone users in Beijing (image via Shutterstock)

Mobile phone users in Beijing (image via Shutterstock)

Cost-cutting pressure is putting a squeeze on China’s three big telcos, creating an unusual set of conditions that could claim smartphone giants Samsung and Apple as victims. The latest signs of trouble for the world’s two largest smartphone makers comes in the form of an article in the English language China Daily newspaper, calling on China’s big three mobile carriers to stop offering packages with Samsung and Apple smartphones and instead only offer models from domestic manufacturers like Lenovo, ZTE, and Huawei. Further evidence of the pressure the telcos are feeling comes in an unrelated report, which has the trio denying reports that they’re preparing massive layoffs.

The bigger story is that China’s three telcos are seeing profit growth slow sharply or even contract as their mobile market matures and most of the country’s 1.3 billion people now have service. What’s more, the trio of China Mobile, China Unicom, and China Telecom are all spending billions of dollars to build new 4G networks, and millions more to promote 4G services by selling handsets at subsidized prices.

Like many large state-run companies, the three telcos all count Beijing as their biggest stakeholder, and thus are somewhat obliged to follow directives from the central government. Most recently the government has ordered the trio to cut their costs by trimming promotional spending. That means they’ll need to cut back their practice of purchasing bulk volumes of phones from different smartphone makers, and then offering those phones for cheap prices to consumers who agree to long-term service plans.

Now it appears the government is guiding the telcos specifically to reduce their buying from foreign smartphone makers, based on signals coming from the state-owned China Daily, which often functions as a government mouthpiece for a foreign audience. A new headline on the front of its business page proclaims “Smartphone subsidy cuts to lift local firms,” and goes on to say the telcos should end their practice of subsidizing phones from foreign manufacturers like Apple and Samsung.

The story quotes an analyst with an unnamed telecom research organization in Beijing, which could easily be one of the many quasi-governmental bodies that advise the government. Such bodies wield huge clout in formation of government policy, and in this case it’s quite easy to see why Beijing might want to force the telcos to give most or all their subsidy dollars to the domestic manufacturers.

While Apple and Samsung focus on the higher end of the market and are both quite profitable, the same isn’t true for the growing number of Chinese firms that have piled into the market over the last two years. Most of those, including Lenovo, Huawei, and Xiaomi, are squarely focused on the mid- to lower-end of the market, and have been locked in a nonstop stream of price wars that are rapidly eroding their margins.

Against that backdrop, it’s not difficult to understand why Beijing might want to use the telcos as a policy tool to support struggling domestic smartphone makers. Many observers might argue such a move represents discrimination against foreign firms, and China has recently been accused of similar discrimination after a series of anti-trust investigations targeting mostly foreign firms.

I mentioned the denial of plans for massive layoffs by the Chinese telcos at the top of this post, so I’ll briefly return to that in closing, which again shows the pressure the carriers are facing to cut costs. Those reports are brief, with the carriers collectively denying any plans to lay off some 300,000 workers. Such cuts do seem unlikely, since Beijing leaders are worried about growing unemployment as China’s economy slows. But cutbacks to subsidies for Apple and Samsung phones seem far more possible, and could easily begin later this year.

Bottom line: China’s three telcos are likely to trim their bulk purchasing of Apple and Samsung smartphones as part of a Beijing campaign for them to cut costs and support domestic manufacturers.

Doug Young lives in Shanghai and writes opinion pieces about tech investment in China for Techonomy and at www.youngchinabiz.com. He is the author of a new book about the media in China, “The Party Line: How the Media Dictates Public Opinion in Modern China.

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Wisely Harnesses Spending for a Local Business Guide http://techonomy.com/2014/08/wisely-harnesses-spending-local-business-guide/ http://techonomy.com/2014/08/wisely-harnesses-spending-local-business-guide/#comments Mon, 18 Aug 2014 15:25:27 +0000 http://techonomy.com/?p=17852 Like most people, you probably read online product and service reviews with a healthy grain of salt. But if users doubt the credibility of online recommendations, how can sites that curate them earn consumers’ trust and loyalty? Michigan-based Wisely set out to do precisely that when it created a new kind of local discovery app that gathers real transaction data from customers, such as how much they spend at a restaurant, instead of subjective information like customer reviews. We spoke with Wisely co-founder and CEO Mike Vichich about what Wisely does for small businesses, and why building an “awesome” Michigan starts in Detroit.

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In anticipation of our Techonomy Detroit conference on September 16, we are profiling Detroit-area tech startups that are driving the city’s re-emergence as a center of innovation. (To register for the conference, click here.)

wisely-mike-vichich

Wisely CEO Mike Vichich

Like most people, you probably read online product and service reviews with a healthy grain of salt. But if users doubt the credibility of online recommendations, how can sites that curate them earn consumers’ trust and loyalty?

Michigan-based Wisely set out to do precisely that when it created a new kind of local discovery app that gathers real transaction data from customers, such as how much they spend at a restaurant, instead of subjective information like customer reviews. The service also enables local merchants to connect with their most loyal customers through the technology. It’s starting to get attention. USA Today featured the Wisely app, calling it an audience favorite at the recent Apple Developers Conference.

With its focus on crunching transaction data, Wisely is helping to grow local economies like its home base of Ann Arbor. But the company’s big-picture goal is to map the entire nation’s economy. We spoke with Wisely co-founder and CEO Mike Vichich about what Wisely does for small businesses, and why building an “awesome” Michigan starts in Detroit.

How does Wisely work?

We are using transaction data to build an app for consumers that, based on how you spend, presents tailored recommendations from people like you. We also use transaction data to allow merchants to better engage with their most valuable customers.

Transaction data is valuable to consumers, merchants, and third parties like small business entrepreneurs who are trying to figure out the best places to start their businesses. It’s valuable to a local commercial bank trying to understand the demand for certain categories of business like a restaurant, and also to government for being able to measure and inform economic policy.

How do you gather my consumer data?

You link your credit card account and then your transaction data gets pulled in. Historically people have used that only for budgeting [with apps like Mint]. There is a lot more than can be done outside of budgeting.

Did you create Wisely in response to flaws you saw in other recommendation apps?

At a macro scale level, anyone can write a review in Yelp. In order to write a review on Wisely you have to be an actual customer. You won’t see a review from fake customers on the service.

Also, other services don’t do a wonderful job personalizing. Sure, there might be some restaurant that has five stars in an area, but that doesn’t mean it’s my style of place. So what we’re doing is Netflix-ing or Spotify-ing—“because you watched this video, you might also like this one”—with physical places.

Do people feel comfortable giving their financial data to Wisely?

Most of our users are in the late 20s to early 30s age range. Above 40, 45 the likelihood of being interested in linking your account is lower. Mint and other personal finance websites have shown that 35 million users are willing to link their accounts to budgeting services. The bet we are making is that people will be willing to link their account for personalized recommendations and recognition to merchants. If not, then we will have to reevaluate things.

How do merchants benefit from your service?

They are able to provide a better experience to their customers. A merchant can say, “Every time a platinum customer comes into my store, send them a push notification telling them to show this message to the host to get priority seating.” It’s giving a better experience to customers who love you the most.

Also, it is a way to engage with customers based on their interests and contacts. If a bar has a special event it can invite its top guests via Wisely. Users have the ability to provide feedback to a message—mute a type of message or merchant—so messages can get better and better.

What are your ambitions for Wisely?

Anywhere that a map of the economy can be useful, we think is an opportunity for Wisely. This is why we like the name wisely. Shop wisely, market wisely. It could be govern wisely, lend wisely, or invest wisely.

We think that we would be uniquely valuable to the conversation about the future and planning of cities. We are, for example, doing a project with a local economic development group in Ann Arbor. We will provide them with a macro level map of economic activity in Ann Arbor so they can make smarter decisions. We’ll say, “Here are our patterns, and when people come to Main Street this is typically the type of thing they will do or spend on a restaurant or an entertainment venue.”

Being able to say, “Hey, we think there might be demand for pizza in this area based on how far people travel for pizza in this location,” is an awesome way to help a small businessperson plan. And if a local bank knew there was a market for a pizza chain at that location, it might be ready to give that small businessperson a loan.

Why did you start your company in Ann Arbor?

My background is in growth strategy consulting. I’m from Michigan, but I was on a plane every week to the East and West Coasts for five years. I didn’t want to be a consultant for the rest of my life. I wanted to build a product that could reach tens of millions of people.

My cofounder and I decided to move here because the University of Michigan and Michigan State have great computer science programs. Right next door to U of M is a great place to be. You can recruit awesome people coming out of college and give them a chance to work while they are in school. Plus, Ann Arbor is just a cool town. There is a lot going on.

How does the spirit of Detroit resonate with you in Ann Arbor, and how optimistic are you about Detroit getting back on track?

I grew up going down to Detroit with my family. I’ve been a fan of all the Detroit teams. Historically Detroit holds a very special place in my heart going back to the arsenal of democracy and cars.

I don’t think you can build an awesome Michigan without an awesome Detroit. More and more people get that now; the governor gets that and there has been awesome stuff going on in the public sector.

You also see the private sector booming in Detroit like it never has before, led by Dan Gilbert placing billions of dollars in capital downtown and single-handedly building a downtown that is viable. We are now at a tipping point where it is starting to manifest more broadly. Gilbert got the ball rolling but you will start to see other people begin to pile on more and more.

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It’s Getting Complicated for Growing Chinese Smartphone Makers http://techonomy.com/2014/08/getting-complicated-growing-chinese-smartphone-makers/ http://techonomy.com/2014/08/getting-complicated-growing-chinese-smartphone-makers/#comments Mon, 18 Aug 2014 14:04:46 +0000 http://techonomy.com/?p=17978 Smartphone makers Xiaomi and Huawei are learning tough new lessons this week, reflecting intense competition in the overheated market where a feisty field of Chinese players are vying for a place alongside global leaders Apple and Samsung. News in the smartphone space has been coming nonstop over the past year, as a crop of larger players including Xiaomi, Huawei, ZTE and Lenovo compete with smaller but equally aggressive names like Coolpad and Oppo in their home market.

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(Image via Shutterstock)

(Image via Shutterstock)

Smartphone makers Xiaomi and Huawei are learning tough new lessons this week, reflecting intense competition in the overheated market where a feisty field of Chinese players are vying for a place alongside global leaders Apple and Samsung. In Xiaomi’s case, the company has become embroiled in an embarrassing new gaffe in Taiwan involving collection of personal data. Meantime, Huawei’s Honor line of smartphones, which it’s trying to position as a mid- to upscale brand, is rapidly moving into the bargain bin with word that it has slashed the price on a new 4G model to just 799 yuan, or $130.

News in the smartphone space has been coming nonstop over the past year, as a crop of larger players including Xiaomi, Huawei, ZTE and Lenovo compete with smaller but equally aggressive names like Coolpad and Oppo in their home market. One of the most successful players in the pack has been the young Xiaomi, which has built its success on a high-profile marketing campaign that includes strategic media leaks, frequent promotions and an Internet-only sales model that caters to young hipsters.

That campaign has resulted in intense media coverage for the company, including a growing number of scandals over relatively small issues that probably would never be noticed if they occurred at any other domestic rival. Last week the company was embarrassed in Taiwan, one of its first markets outside of mainland China, when it was fined for publishing inflated sales data.

Now Xiaomi is back in the scandal headlines once more, this time for collecting personal data without consent of its users. The news, which was uncovered by Taiwan’s aggressive domestic media, prompted Xiaomi to issue a rare apology and say it was taking steps to fix the “problem.” Like last week’s fine for its inflated sales claims, this latest gaffe looks relatively minor and probably won’t damage Xiaomi’s reputation too much. But more such negative news could eventually hurt its reputation both in China and in its expansion markets, tarnishing the hip and trendy image it has so carefully cultivated.

Next let’s take a look at Huawei, which has just slashed the price on the 4G edition of its Honor brand 3C model by about 20 percent. The company announced on its website the model will now sell for 799 yuan ($130), down from its previous price of 998 yuan. The move comes less than a year after Huawei relaunched Honor with the aim of developing a brand that could compete more directly with the mid- to high-end models from Apple and Samsung.

This particular move comes just four months after Huawei made similar reductions in another one of its Honor-brand phones, the large screen 3X, that brought its price tag down below the 1,000 yuan mark, to 998 yuan. It made that move as Xiaomi promoted its own large screen model that sold for 799 yuan, reflecting the rapid price cutting that has been gripping the smartphone sector for most of the past year.

Just last week, the head of Huawei’s smartphone division was in the news after saying his company was getting out of the ultra-low-end business, in a nod to how stiff competition has become for the cheapest models. This latest price cut for a smartphone that was supposed to be a mid-end model shows that competition is creeping up beyond the low-end of the market. That looks like bad news for everyone, meaning Samsung and even Apple could join the domestic players in starting to feel some pressure in China before the price wars finally ease sometime next year.

Doug Young lives in Shanghai and writes opinion pieces about tech investment in China for Techonomy and at www.youngchinabiz.com. He is the author of a new book about the media in China, “The Party Line: How the Media Dictates Public Opinion in Modern China.

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Upstart’s P2P Lending Platform Aims at Young Borrowers http://techonomy.com/2014/08/upstarts-p2p-lending-platform-aims-young-borrowers/ http://techonomy.com/2014/08/upstarts-p2p-lending-platform-aims-young-borrowers/#comments Fri, 15 Aug 2014 19:45:21 +0000 http://techonomy.com/?p=17943 For would-be borrowers with little credit history, getting a loan can be a nightmare. But one important group of applicants are young, well educated, and entrepreneurial—and would probably be favorable credit risks. Techonomy asked Dave Girouard to respond to questions about how lending platforms like Upstart can help investors and borrowers alike.

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Dave-upstartFor would-be borrowers with little credit history, getting a loan can be a nightmare. But one important group of applicants are young, well educated, and entrepreneurial—and would probably be favorable credit risks. Dave Girouard, CEO of the online peer-to-peer lending platform Upstart, believes access to capital is vital to young people’s careers. That’s one reason he left his job as president of Google Enterprise, which brings Google Apps to schools and businesses, to launch Upstart in April 2012 with partners Paul Gu and Anna Mongyat (another Google refugee). Techonomy asked Girouard to respond to questions about how lending platforms like Upstart can help investors and borrowers alike.

Do you specifically target younger borrowers, and if so why?

We serve borrowers of all ages, as long as they are at least 18 years old. But for sure we have particular skills and the ability to serve “thin file” borrowers—those without much history of credit.

The decision was a product of three observations. First, access to capital on fair terms is critical to young people; money is a fundamental building block of a career. Second, people without significant work or credit history are screwed by the consumer credit market. They’re presumed to be risky just for lack of proof otherwise. And third, there’s a ton of data available about individuals that lenders don’t ask about that is highly predictive of a person’s ability to repay a loan such as where they went to school, what they studied, and how they performed academically. The idea of looking at education-related data to predict creditworthiness owes itself to the Google hiring model—it’s the same data we used to make hiring decisions, so why not use it to make credit decisions? By understanding the person’s employability and earning potential, we can identify “future prime” borrowers before other lending platforms can.

Explain how Upstart’s peer-to-peer lending and borrowing component works.

We’ve created a platform that brings together high-quality borrowers and investors who can choose to invest in those loans. It’s a win-win in that borrowers get lower interest rates and investors can get attractive yield, relative to other investment opportunities.

Investors can actually browse through loans and invest any amount, starting at $100, in any loan. Alternatively, with auto-invest, an investor can simply create a filter that describes the type of loans he or she wants to invest in, and the amount of dollars per loan, and the investments can be made automatically by the system, with a particularly weekly or monthly budget. We service the loan and redistribute the repayments back to investors, making it super easy to invest on the platform and generate great returns.

What kind of information about the borrowers do you provide to lenders?

Although the loans are anonymous, the investor can see a lot of information about the borrower—credit score, monthly income, existing debt obligations, schools attended, test scores, and more. In addition to all the information you’d see on a more traditional lending website, you get insight into the borrower’s education, which is critical to understanding his or her employability.

Why are only accredited investors allowed to invest, and can you briefly explain how someone becomes an accredited investor?

Accredited investor is a definition created by the SEC. For individuals, you have to either have $1 million in assets, or earn at least $200,000 for each of the last 3 years ($300K for a household). It’s a self-reported concept, rather than something you apply for with the SEC.

The only path to allowing other retail investors to invest on Upstart would be to register the security with the SEC. There’s a tremendous amount of cost, complexity, and risk in that path, and it’s not something that makes sense for us as a business right now. Concepts like the JOBS Act may impact this in the future, although the current incarnation of that legislation is focused on equity investments in emerging businesses.

Why did you choose to distribute the risk to investors using a peer-to-peer model instead of originating the loans and collecting the returns?

We believe that creating a marketplace where we charge minimal fees to build and support the platform can have the most impact over time. Online lending is powerful when it eliminates the spread by directly connecting investors and borrowers. As a platform, we have the proper incentive to reduce costs and get borrowers the best possible rates. And because we forfeit the origination fee to investors on any loan that defaults (something no other lending platform does), our interests are aligned with platform investors.

In terms of short-term profitability, it would probably make sense on our balance sheet to be the lender ourselves, but that’s ultimately not as disruptive and valuable over time.

Do you ask borrowers how they intend to use their loans? If not, do you compile information about how disbursed loans have been used?

Yes. About 60 percent of borrowers are using the loan to pay off credit cards. Eight to ten percent are using the loan to either take a coding course or pay off a private student loan. The rest are split between relocation, a major purchase, or expanding a business.

What is the average size of an Upstart loan, and what is the average borrower age?

The average loan is between $14,000 and $15,000. Our average borrower is about 28 years old.

What are average interest rates for borrowers and returns for lenders?

Interest rates can range from about 6 percent to 18 percent, with an average of 11 percent. Returns for lenders range from 6.2-12 percent depending on the loan grade. The average return is 10 percent.

Have you considered using social media and a borrower’s social graph as criteria in determining credit-worthiness?

We’re a data-driven company, so we’re not into making leaps of faith about whether signals from the social graph may or may not indicate creditworthiness. Does the fact that your Facebook friend has a high FICO score suggest that you’d be a good borrower as well? I have no idea. So until somebody can show us something conclusive, we’ll stick to variables and methodologies we know to be predictive. [Girouard says he’s heard of the social micro-lending platform Lenddo, which uses social media to calculate credit-worthiness, but in developing countries only. He says he does not know enough to comment on its methods.]

With many recent graduates carrying significant student-loan debt, how do you feel about potentially increasing their debt burden—in many cases at significantly higher interest rates?

That’s not what we’re doing. The majority of Upstart borrowers are using proceeds to pay off credit cards. On average, they are reducing their interest rate by 600 basis points—that’s a gigantic improvement in terms of cost of credit. Others are paying off high-interest private student loans, so reducing their monthly payments. An installment loan doesn’t just save you money over credit cards; it also results in a better FICO score. And that decreases the cost of the mortgage you might want in later years.

The debt-to-income ratio of our borrowers is significantly lower than on either Lending Club or Prosper, and we’re very proud of this fact.

 

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Lebanon’s Serial Entrepreneur Bets on Online Acceleration http://techonomy.com/2014/08/lebanons-serial-entrepreneur-bets-online-acceleration/ http://techonomy.com/2014/08/lebanons-serial-entrepreneur-bets-online-acceleration/#comments Fri, 15 Aug 2014 18:45:22 +0000 http://techonomy.com/?p=17957 Samer Karam has been a war photojournalist, a banker, an entrepreneur, and a PhD student. But these days, the Gen-X techie is focused on enabling the success of others. His online accelerator Alice, based in London, welcomes startups from anywhere in the world to apply for mentoring and funding. Karam, who also founded and recently closed Beirut’s first accelerator, Seeqnce, is known as one of Lebanon’s most prominent tech mentors.

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samer-karamSamer Karam has been a war photojournalist, a banker, an entrepreneur, and a PhD student. But these days, the Gen-X techie is focused on enabling the success of others. His online accelerator Alice, based in London, welcomes startups from anywhere in the world to apply for mentoring and funding.

Karam, who also founded and recently closed Beirut’s first accelerator, Seeqnce, is known as one of Lebanon’s most prominent tech mentors. He sat down earlier this summer at Bliss Café on bustling Hamra Street to discuss—between incessant phone and email check-ins—how Alice will succeed where Seeqnce did not.

After spending time in the U.S., Canada, and the United Kingdom, Karam is convinced that a traditional physical brick and mortar accelerator program can’t work in the Arab world or other developing markets such as Southeast Asia. Fledgling startups there need so much more time, training, and mentorship that there is little return-on-investment for such an accelerator, he says.

“The market here is not as fast moving as in the United States. For the kind of growth that you would need [to be successful], it would take a year or two or more in the Arab world,” says Karam. The solution, he says, is to “find a way to identify the non-human-intensive components” of a startup accelerator, “develop them into a product, and put that product online.”

With such a bleak outlook on the potential of Middle East startups, why bother? Because, he says, the need bowled him over. “I cleaned up this little office I had in [Beirut suburb] Sin El Fil, and invited a few people who had startups or were starting to work on startups,” says Karam. “I started doing entrepreneurship-related activities, workshops to try to get people more engaged with their community.” When more than 250 entrepreneurs showed up to an open house in November 2010, he realized he was onto something and established a coworking space.

Though the project raised a few hundred thousand dollars and attracted startups from all over the Arab world, Karam says there wasn’t enough volume. “We weren’t able to get to a place where the building was continuously occupied,” he says. So the serial entrepreneur spent another year studying accelerator programs in the United States and Europe and picked four partners to help accelerate eight startups, which he chose based on who was hungriest.

“The idea isn’t worth anything. It is always more about if the individuals have this hunger for innovation,” he says. Ultimately, the accelerator he called Seeqnce gave birth to three of the most successful startups in Lebanon: et3arraf, Lebanon’s first online dating website; eTobb, a medical website that provides doctors’ answers to users’ questions; and Presella, a ticketing app and website now based in Dubai that has sold more than $600,000 in tickets in 18 months.

Walid Singer, Chief Operating Officer at Presella, credits the efforts of Karam and the five Seeqnce directors who raised funds for his company’s success, rather than the accelerator. “As entrepreneurs, we could learn anywhere.”

Now Singer and his team are using the online platform Alice to solicit additional funding.

Singer shares Karam’s misgivings about the potential of Beirut startups. Instability in the region keeps most investors at bay. “You can start a business in Beirut, but it won’t become profitable,” says Singer.

Adds Karam, “The best thing you should aim for is acquisition.” But Karam points to one advantage of being a tech innovator in Lebanon, as opposed to another sort of business: “Should the shit hit the fan, you just close your laptop, get on a plane, and start the same thing over 24 hours later in Cyprus or Turkey.” Same goes for an online accelerator.

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Ten Ways Connected Devices Will Impact Every Organization http://techonomy.com/2014/08/ten-ways-connected-devices-will-impact-every-organization/ http://techonomy.com/2014/08/ten-ways-connected-devices-will-impact-every-organization/#comments Fri, 15 Aug 2014 18:33:15 +0000 http://techonomy.com/?p=17948 This year, the number of mobile-connected devices will exceed the world’s population. To survive the coming decade, most organizations will have to respond in some way to the rise of connected devices. As connected products, connected logistics, and connected phones become ubiquitous, they create value for users and risks for companies. For companies that make durable physical products it’s easy to imagine a digitally connected version. For companies that make consumables, the Internet of Things is slated to revolutionize logistics. For both, ubiquitous connected mobile devices are already changing commerce, workflow, and customer relationships.

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(Image via Shutterstock)

(Image via Shutterstock)

This year, the number of mobile-connected devices will exceed the world’s population. To survive the coming decade, most organizations will have to respond in some way to the rise of connected devices. As connected products, connected logistics, and connected phones become ubiquitous, they create value for users and risks for companies.

If you’re reading about the Internet of Things for the first time, here’s a short primer. But now that there’s widespread knowledge about the Internet of Things (IoT) — also known as the Machine to Machine internet (M2M) or the Industrial Internet (II) — we at consulting firm Undercurrent find that senior leaders at global organizations still struggle to articulate how it will meaningfully change their business, or shrug it off because they’re in the energy business, or the orange juice business, or name your 20th century business.

Winners will know they’re winning before losers find out they’re losing.

The pressures the IoT brings affect all types of organizations. For companies that make durable physical products it’s easy to imagine a digitally connected version. For companies that make consumables, the Internet of Things is slated to revolutionize logistics. For both, ubiquitous connected mobile devices are already changing commerce, workflow, and customer relationships.

Here are ten ways IoT will affect companies, and how companies can respond.

1. Do or die, the market expects it.

Over the next three years, every major manufacturer will have to include connectivity in its business product lines or logistics. Consumers will demand it soon, but Wall Street will demand it first. Companies like Tesla with their connected car or Amazon with their connected logistics are already trading above traditional valuations. Shareholders and analysts will evaluate companies based on their ability to integrate connectivity into their business and product lines.

2. Making products is easy, but production changes too.

Manufacturers of consumer durables and equipment manufacturers will have to make connected products. CPG companies and grocers, will have to build in smart logistics. The new tech enables efficiency in managing production and distribution. Connected sensors monitor liquids, gases, and chemicals in real time. Route automation for moving things is on the horizon. Fleets of driverless trucks will soon become the standard.

3. The race to own the platform starts with a product focus.

Competition will be dire, as most businesses will try to own the platform. While the tendency in big business is to build the platform first, every platform business starts off as a product business. Nest didn’t build a platform first, it built the best thermostat. To win, start with a hero product that conquers hearts and markets. This requires a radical focus on creating products and experiences that are beautiful, functional, and valuable to customers.

5. IoT is an ecosystem play, and enables relationship growth. If you’re in the consumer business, own the home or the body.

In the future, consumers will buy new products based on how well they integrate with their smart home appliances or their health app. In June Apple released development kits for the smart home and the smart body. They’re enabling your competition and startups worldwide to create beautiful experiences for connected devices. When you go to Best Buy in a couple of years, you’ll ask if your new washing machine displays a discreet notification on your iTV. Being present in the home meaningfully also creates a commercial channel, and creates opportunities for great partnerships. You’d benefit if your fridge automatically re-ordered groceries from FreshDirect or Amazon Fresh, and so would the partners involved.

Connected equipment can sense and communicate a potential fault in any system before it creates a crisis. Such equipment can also lead to new efficiencies. For instance, a full milk tank can signal a smart truck to come pick up farm-fresh milk. Either way, a new service-driven model creates a reliable recurring revenue stream and protects your business from downstream challengers.

6. Alternative business models will emerge.

When connected products become pervasive and communicate continuously with one another, marketplaces are created involving machines, not just people. Imagine a future where your fridge negotiates with the grid in real time to get you the best rate on power if it can wait a bit for the next cool cycle. Optimization provides quantifiable benefits, and value becomes apparent to your customers. Inside industry-leading businesses, the risk tolerance required to embrace new business models (think Innovator’s Dilemma) is paramount to making big leaps.

7. Your organization will need new skills.

Creating these products or supply chain improvements will likely require you to focus on hiring more engineers, designers, and data scientists. Hardware is increasingly just software wrapped in plastic, and connected hardware is all about data. Your organization structure might have to adapt as well in order to move faster. You might have to shed some fat in other areas of the business. Teams will have to be leaner, smaller, and multi-disciplinary to get to market faster.

8. In emerging markets (and beyond), mobile becomes the default interface.

In Kenya, more than two thirds of the adult population uses a mobile digital currency called M-Pesa; 25 percent or more of the country’s GNP flows through this parallel financial system. Most emerging markets already have pervasive mobile usage, and smartphone adoption is increasing in the rising mobile-first billion.

Besides being a requirement for products or solutions targeting developing markets, mobile is a natural interface for connected devices. I love Benedict Evans’ perspective on this: dumb sensors paired with smart phones become exponentially more valuable.

9. Existing assets or infrastructure become more valuable when they’re connected.

For many companies, perhaps the most overlooked asset class is the network of products and customers that an established business has already created in the world. Imagine you’ve been selling vacuum cleaners or street lamps for decades. Odds are, there are thousands or even millions of products exist in the world with your brand.

Similar to how cell tower businesses use their network of physical assets (towers) to create new revenue streams by leasing out spots on the towers, all companies with products out in the world have a potential base to integrate sensing, connectivity, and intelligence open new and exciting revenue streams. Imagine how valuable the street lamps on your highway become if they broadcasted up-to-the-second traffic updates.

10. More than anything, recent advancements in connectivity, artificial intelligence, and robotics demand a change in strategy.

Organizations will require a clearer visionary focus and purpose. The teams and skill-sets required for companies to succeed in the near future need to pair up with new ways of working. Leadership teams must find comfort in embracing unknowns and iterating towards solutions, and they have to empower their teams to move quickly into new markets and product spaces.

The change brought on by this new wave of connectivity will be will be subtle at times, but always valuable. What’s intimidating is that winners will know they’re winning long before losers find out they’re losing.

Vladimir Pick works as a senior strategist for New York City consultancy Undercurrent, where he advises leaders of Fortune 100 companies on strategy, organizational design, and digital transformation.

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Talking to “Biologist’s Imagination” Author William Hoffman http://techonomy.com/2014/08/talking-biologists-imagination-author-william-hoffman/ http://techonomy.com/2014/08/talking-biologists-imagination-author-william-hoffman/#comments Thu, 14 Aug 2014 13:56:17 +0000 http://techonomy.com/?p=17907 In a new book called "The Biologist’s Imagination," authors William Hoffman and Leo Furcht from the University of Minnesota Medical School take a spin through the history of biological innovation in an effort to shed light on current trends and expected future developments. The authors weave historical threads—such as pioneering studies of genetic traits in the mid-19th century and the effects of the animals and diseases brought to the Americas in the wake of Columbus crossing the Atlantic—to help readers make sense of what’s happening today.The book covers a number of topics relevant to Techonomy, so we chatted with Hoffman to find out more.

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Biologist’s-Imagination-William-HoffmanIn a new book called “The Biologist’s Imagination,” authors William Hoffman and Leo Furcht from the University of Minnesota Medical School take a spin through the history of biological innovation in an effort to shed light on current trends and expected future developments. The authors weave historical threads—such as pioneering studies of genetic traits in the mid-19th century and the effects of the animals and diseases brought to the Americas in the wake of Columbus crossing the Atlantic—to help readers make sense of what’s happening today. They track biological and technological innovation from its earliest days, but focus on what’s happening now: the state of the pharmaceutical industry, direct-to-consumer genetic testing, scientific intellectual property, and more. The book covers a number of topics relevant to Techonomy, so we chatted with Hoffman to find out more.

When it comes to synthetic biology, there’s an inherent tension between fears of genetic modification and the critical need to use resources more efficiently. How does this get resolved?

In this country, you’ve got a very interesting split. It’s been 20 years now since the Flavr Savr tomato was approved by the FDA. There have been countless studies, and they haven’t shown anything convincing that we should be alarmed about, as far as food intake is concerned. (For effects on the environment, the jury’s still out.) But you have a very strong reaction against GM food in some quarters. I think this is going to take a long time, and scientific studies showing that food from genetic modification is safe will have marginal impact. This goes beyond scientific evidence and into the cultural realm.

We’re also seeing a lot of turmoil in the nascent field of consumer genomics. Where do you see that heading, particularly given FDA’s actions with 23andMe last year?

Consumer genomics will persevere. People want the information and there’s no reason they’re not entitled to it. But the FDA does have the responsibility to insist that what companies say about personal health information based on genetic data is accurate and can be verified. There’s no question that new models of ongoing regulatory reform and standards are needed so that agencies can adapt. One of the big problems we have at agencies such as FDA is rapid turnaround of personnel. You’ve got to be able to hire smart people and keep them employed over a longer period of time—they’ve got to like what they do and be compensated decently for what they do, otherwise they will leave. If you want to have a top-notch and moderate regulatory framework, it’s got to be funded and you’ve got to keep people on board.

You talk about the importance of open-access publishing, which allows anyone to read research papers without pricey subscriptions to scientific journals. What’s happening in this arena now?

Federal funding agencies are moving forcefully into mandates that journal articles be available at least after a certain period of time; that’s also happening in the European Union. A lot of this is being driven by patient advocacy groups. They’re tired of seeing information sequestered—they want it available so patients are served.

Your book covered regions such as Research Triangle Park that have emerged as major biotech hubs. What lessons can we glean from these successful clusters that might apply to cities attempting to revitalize, like Detroit, where Techonomy is hosting a public conference in September?

The solid research base and physical infrastructure are critical for this field: how that base is supported, locally as well as federally, and how it links its activities with the local industrial community. As these communities revitalize, simply creating greater self-awareness through networking and entrepreneurial associations becomes all the more important. The tacit communication within these concentrations is very important; people need to know what other people are doing. Another thing is to use existing research and industrial strength to create the conditions for existing embedded know-how to move into bio. With respect to Detroit, Wayne State University is strong in biomaterials research. So is Ford.

What is the role you see for the growing group of amateurs getting involved in biological research, the trend known as biohacking or DIYbio?

I am intrigued. We’re fairly early in a biological revolution and the tools are coming fast and furious. There’s always been a tension, even in the beginning of the industrial revolution, between the credentialed and the uncredentialed. So-called biohackers are largely uncredentialed in the academic sense, but they are very creative people. Many of them work in established community labs now, like BioCurious. They’re involved in crowdsourced design, and they get crowdfunding. They’re outside the standard mainstream practice of laboratory science, but they’re going to be part of this.

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Benzinga: The Detroit-based Online Investing Tool for Average Joes http://techonomy.com/2014/08/benzinga-detroit-based-online-investing-tool-average-joes/ http://techonomy.com/2014/08/benzinga-detroit-based-online-investing-tool-average-joes/#comments Wed, 13 Aug 2014 14:26:45 +0000 http://techonomy.com/?p=17847 When Jason Raznick set out to create an online financial service to help the average investor, he didn’t gravitate to New York City’s center of global finance. He launched it from his basement in Birmingham, Michigan. Recognizing the need for a service that delivers quality investment information to people who don’t have a Wall Streeter’s access to real-time data, he figured his hometown was as good a place as any to get started. Now operating in Detroit, Benzinga continues to grow its audience as the rise of community-based, social investing continues to transform the industry.

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In anticipation of our Techonomy Detroit conference on September 16, we are profiling Detroit-area tech startups that are driving the city’s re-emergence as a center of innovation. (To register for the conference, click here.)

jason picWhen Jason Raznick set out to create an online financial service to help the average investor, he didn’t gravitate to New York City’s center of global finance. He launched it from his basement in Birmingham, Michigan. Recognizing the need for a service that delivers quality investment information to people who don’t have a Wall Streeter’s access to real-time data, he figured his hometown was as good a place as any to get started. Having built a sizable following with his writing about small-cap and defense stocks in the early 2000s, Raznick formed Benzinga to provide news, educational resources, and a community platform to regular investors. Now operating in Detroit, Benzinga continues to grow its audience as the rise of community-based, social investing continues to transform the industry. Techonomy spoke with Raznick about Benzinga’s evolution, and why Detroit’s can-do attitude makes it a great setting for digital startups.

What does Benzinga offer its users?

We want to help people understand what investing is. It’s crazy that schools teach health and nutrition, but they don’t teach you about finance. Benzinga groups content and education together to make investing fun and successful for the average investor.

When you go on Benzinga you will see a link to Marketfy, an educational platform that has content, a newswire, and thought leaders. So if you want to learn what a 401K is, there is an expert platform for you. 

How has investing changed with the rise of social media, and how has that impacted your business?

It is totally social. We crowdsource experts. Instead of social investing, I call it DIY investing. It is really about empowerment. Before, if you wanted information like a company’s earnings report, the guys on Wall Street had it first. We created our own newswire to deliver news to everyone else at the same time. Marketfy uses the wisdom of the crowd to help educate people about certain types of investor problems. The experts are around the world. They don’t necessarily need a Harvard degree. An expert can be someone who specializes in real estate trusts. They are on our platform. The rise of social has really spurred the growth for Benzinga and Marketfy in a way that wouldn’t have happened five years ago.

Benziga's offices in Detroit.

Benzinga’s Detroit offices

What is Benzinga Pro?

Pro is more targeted towards active traders. We have a real-time news desk of people talking to CEOs of companies and breaking stories in real time. People use it to keep abreast of the stock market.

How do you see Benzinga’s services evolving?

Product subscriptions are the biggest part of our business and growing the fastest. We used to be a content-only business, but we are now really a content and software company. With superior information, data, and tools, we give our readers the edge needed to profit in the markets. We might expand to other verticals, but we are really focused now on trying to find talented developers, product managers, people who have that fire in them.

Do you try to attract talent from outside of Detroit?

We are in the finance space. Where are those guys? Chicago and New York. So we attract them here and we are going to continue to do that. The environment and the affordability here is among the best. So we do find people out of state and get them here.

We have to go where the opportunity is and where the talent presents itself. But overall there is a great culture right here, and more startups need to come here to build on top of this. We could move the company to New York, but I think there is more of a focused culture here. There is really a strong work ethic.

What has the funding trajectory for the company been?

Some of our investors include some of the guys who started Groupon and Lightbank. It was self-funded for a while and then the guys from Groupon invested $1.5 million a few years ago. We turned profitable 6 months ago. We are going from there, investing in the company, and continuing to grow.

What do you like about having a business in Detroit?

There is no hierarchy. If you are a doer you can be successful. It is really an important philosophy to me. In Detroit, the more the doers don’t listen to the hierarchy, the more success they will have. Startups are hard. You wake up and think, “Am I going to have a paycheck the next morning?” Anxiety is always there. But you have to learn to go through walls.

In Detroit as a whole, I see that brightness. I see action happening. I think we are going to see a very different horizon in three years. When I say horizon, I mean companies will be in Fortune and the Crain’s 100 list. We will be there. If we aren’t, I’ll make sure 10 other companies are. I really want others to be empowered to build stuff. There is so much opportunity out there.

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Is Fighting Evil with Google a Good Thing? http://techonomy.com/2014/08/fighting-evil-google/ http://techonomy.com/2014/08/fighting-evil-google/#comments Thu, 07 Aug 2014 21:05:09 +0000 http://techonomy.com/?p=17829 Google's code of conduct famously instructs its staff, board members, and contractors, "Don't be evil." Those who fail to follow the code are subject to disciplinary action and termination. Can the company extend the code to Gmail users? It already has. CBS News reports this week that Google informed the National Center for Missing and Exploited Children that a Gmail account holder in Texas "was allegedly sending explicit images of a young girl to a friend." Read more at The Verge

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(Image via Shutterstock)

(Image via Shutterstock)

Google’s code of conduct famously instructs its staff, board members, and contractors, “Don’t be evil.”  Those who fail to follow the code are subject to disciplinary action and termination. Can the company extend the code to Gmail users? It already has.

CBS News reports this week that Google informed the National Center for Missing and Exploited Children that a Gmail account holder in Texas “was allegedly sending explicit images of a young girl to a friend.” Turns out that the accused, 41-year-old John Henry Skillern, had been convicted 20 years ago of child sexual assault. On Thursday, the Houston police obtained a search warrant and arrested him for possession and promotion of child pornography.

Houston detective David Nettles tells CBS affiliate KHOU that Skillern “was trying to get around getting caught, he was trying to keep it inside his email. I can’t see that information, I can’t see that photo, but Google can.”

The Verge reports that “Google actively scans the images that pass through Gmail accounts to see if they match up with known child pornography.” Images Skillern shared “had previously been identified and given a unique digital fingerprint,” so were automatically flagged.

“Federal law requires that electronic communication providers like Google report instances of suspected child abuse when it becomes aware of them,” the Verge notes. “But whether it’s legally required to actively search out those cases is another question.” Even so, Google has maintained the practice since 2008.

Gmail users consent by default to permit Google to scan all their emails in order to deliver targeted ad content. And there could be little argument against scanning to prevent child abuse. But the practice raises questions about what additional evils Google and other Internet companies could choose—or be legally compelled—to weed out.

Read more at The Verge

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