Yesterday I was at a Royal Academy of Engineering unconference, organized by Source Institute. Other participants included a number of academic engineers from Turkey, Egypt and South Africa. The unconference itself was part of a 2-week programme designed to introduce these engineers to the world of commercialization, technology entrepreneurship, and design, so that they might be able to implement some of the startup thinking that we are so familiar with here in London on their return back home.
It was a fascinating afternoon – some of the sessions focussed on basic startup issues: hiring, team management, funding. But I thought one particular session on technology opportunities in developing markets, and whether people there ‘had a responsibility’ to their countries, was very interesting indeed.
The situation discussed was that of a GMO technology at the University of Cape Town, where a multi-national company once offered the team that came up with it half a million dollars. The actual valuation of the technology was $12 million. The local team were understandably miffed at the disparity, and obtained the advice of an independent research professor at a US university, who validated their desire not to take the offer, saying that multi-national companies do this to technology companies from the so-called emerging markets very often. This, of course, is basic hoodwinking 101, in the guise of ‘business’.
Unsurprisingly, as I was thinking about how the situation smacked of colonialism, the participants themselves brought up the issue. In particular, they argued that technology is a relatively new resource. It is one thing to think of a situation centuries ago, when the Empire traded in precious stones and resources with the colonies at terms that were entirely favourable to them, something else altogether to assume that that sort of transaction can have a place in the modern age.
Colonial thinking has no place in a world where business, powered by technology, is meant to be transparent, and the playing field fair. If someone values a business for an amount that seems unjustified, it needs to be qualified. The assumption that questions won’t be asked and answers not deemed necessary is laughable, which is what happened in this case. The emerging markets have some of the best minds working on the some of the most interesting problems the world faces today. To not give them that credit when it comes to the brass tacks of signing a contract, never mind the posturing, is to the disadvantage of everyone.
As people working in technology, it’s high time we all commit to respecting talent over an invisible social hierarchy. Going back to the original question posed in the session: do technologists from developing countries ‘have a responsibility’ to their countries to stay away from being hoodwinked, from selling their work for a below-market-value price? Let me put it this way: how about we agree that we are all part of the same stage? The onus isn’t and shouldn’t be on them – the responsibility is all of ours to engage in good business practices for the benefit of all.
Last month, I was invited by Deeson to speak at the Digibury Weekender in Canterbury, Kent. I thought it was an interesting premise – the theme for the talk was ‘technology for good’ – and I really enjoyed the day – thanks to the organisers. I’ve been meaning to upload my talk here for a while, so here it finally is.
I spoke about the contrast between my role at a media agency, working with startups focussed on making advertising money, to what I do with the Other Valleys and Ada’s List.
By and large, I believe that technology can be absolutely a force for good, depending on the people who put it to use. By itself, technology isn’t good or bad – it is the people who use it who make it so. Let’s say Facebook is good, because it helps families and friends connect across geographies, it helps build relationships – social capital, in essence, which for anyone who has Robert Putnam’s seminal work in the 70’s ‘Bowling Alone’, is crucial to maintaining a society. So let’s say Facebook is good. But Facebook, as a result of being heavily invested in its business model, which relates to advertising money, has its dark patches. The research project they conducted last year, that manipulated people’s feeds to test how negative status updates affect people’s tendency to use Facebook was a case in point.
“Ultimately, we’re just providing a layer of technology that helps people get what they want,” Chris Cox, chief product officer of Facebook, said during an interview in February about changes made to the news feed to show more news articles and fewer viral videos. “That’s the master we serve at the end of the day.”
…which to me sounds a lot, and I’m pretty sure Chris Cox said this completely unwittingly – it sounds a lot like what Kevin Kelly says in his book ‘What Technology Wants’:
As a practical matter I’ve learned to seek the minimum amount of technology for myself that will create the maximum amount of choices for myself and others. The cybernetician Heinz von Foerster called this approach the Ethical Imperative, and he put it this way: “Always act to increase the number of choices.” The way we can use technologies to increase choices for others is by encouraging science, innovation, education, literacies, and pluralism. In my own experience this principle has never failed: In any game, increase your options.”
(Emphasis in both quotes above is mine).
Except for one key problem: the Facebook tweaks were not done to increase the number of choices for Facebook users. It was out of a concern that ‘that exposure to friends’ negativity might lead people to avoid visiting Facebook’.
Every single decision that a person makes while creating technology has to be a considered one, because of the impact that it could have on thousands, even millions of people. Even design decisions.
These are all examples of technology being used in a very considered manner, to ‘increase the number of choices for people’ as Kevin Kelly says.
Technology also connects people in ways that I find it very difficult to put a value on. Ada’s List started 2 years ago as an online space for women to ask questions, hire other women, get advice – things that many of us in an industry dominated by men don’t always have access to. And it is making a difference. To many of our members, it helps them stay connected to a larger community they didn’t have access to before.
I’m particularly glad that this conference is examining technology as a force for good because we’re doing so in an environment where billions of dollars in venture capital investment is being poured into startups every single day, many of them not really acting as a force for good – or positive action in any way. Instead it’s become all about the money. A couple of months ago, a VC called Maciej Ceglowski wrote an excellent thesis on why this might be, and these words in particular are really relevant to this conference. He said:
Investing has become the genteel occupation of our gentry, like having a country estate used to be in England. It’s a class marker and a socially acceptable way for rich techies to pass their time.
Gentlemen investors decide what ideas are worth pursuing, and the people pitching to them tailor their proposals accordingly.
The companies that come out of this are no longer pursuing profit, or even revenue. Instead, the measure of their success is valuation—how much money they’ve convinced people to tell them they’re worth.
There’s an element of fantasy to the whole enterprise that even the tech elite is starting to find unsettling.
That’s pretty worrisome. And it means that all of us sitting here today, as men and women working in technology, need to think about this seriously. If it is so easy to make unmindful things, we need to commit – strongly – to using technology as a force for good. To ask for this from the people around us, the people we work for and with. And ultimately, to help create a society that works better for us, and for our future generations.
I’ve been waiting for a book like this for a long time. A book that is about entrepreneurship but one that covers why people took the decision to set up shop in parts of the world where they knew that the economic, social and cultural environment would almost certainly add to their woes (unlike the US or Europe, where regulation and the rule of law are much less of a problem).
Elmira Bayrasli is a journalist and foreign affairs correspondent who has over the years written for the Wall Street Journal and New York Times, and is also an academic who lectures at New York University. In addition she is the co-founder of a platform for female journalists called Foreign Policy Interrupted (I am a regular reader of their newsletter). Earlier in her career, she worked for the State Department of the USA, where amongst many interesting experiences she once had a Bosnian citizen comment on what the country really needed: jobs, not aid. This set her off on a journey to dig up interesting stories on what it really is like for someone to start a business in developing economies – how different is it really to the US?
‘From the Other Side of the World: Extraordinary Entrepreneurs, Unlikely Places’ is her answer. I am an avid follower of the startup ecosystem in Asia, Africa, Latin America and the Middle East, and I started off reading this book (a very easy read, by the way, which makes it quickly digestable for a wide audience) slightly skeptical about whether the book would really be able to capture the complexity of the challenges that people face in these parts of the world. By the end of it I was forced to reconsider. Not only did it do this very skilfully, Ms. Bayrasli has been able to bring out the similarities (i.e challenges) of the entrepreneurial ecosystem of seven different countries even as she builds the characters of seven founders into interesting enough stories in their own individual rights, using her vast experience as a journalist and writer.
The first story is from Turkey (Ms. Bayrasli’s family belongs to the country), where we learn about Bulent Celebi, who in 2004 started AirTies, now a multi-million dollar enterprise trading with the likes of Swisscom. He built the company by focusing on maintaining a strong culture, something Turkish employees were largely unfamiliar with, especially in 2004. AirTies’ corporate values weren’t just ‘feel-good rhetoric’, as the author notes, it was about being focussed on ‘customers and excellence, not on problems’, because problems, according to Bulent Celebi, are ‘too easy and cheap to get caught up in, with no upside at the end’.
The second story is set in Nigeria, where Tayo Oviosu, founder of Paga Tech, is trying to build his mobile payments startup by actually contributing to building infrastructure in collaboration with the Nigerian government, specifically fiber optic cables and generators for backup during a power outage. Nigeria, as we know, is beset with problems (as almost all the economies covered in the book are): weak governance, corruption, and the Boko Haram insurgency are just some. Reading about what Paga Tech is valiantly trying to achieve – the ability to bank the unbanked in rural and urban Nigeria through mobile phones, and enable them to have consistent access to mobile networks and broadband, is very inspiring.
This is followed by the story of Monis Rahman in Pakistan, the founder of Naseeb Networks, which runs a matchmaking site as well as Rozee.pk, a popular job search engine. Monis is doing this in a country where community spaces are typically looked upon with distrust (indeed, Sabeen Mahmud was gunned down by extremists in Karachi earlier this year for doing exactly that with her physical community space The Second Floor) so by trying to build virtual community spaces, he is also trying to ‘shift perspectives on Pakistan’, as the author notes. Again, the country’s political environment does not help, so it is an uphill climb.
In Mexico, Enrique Gomez Junco, the founder of Optima Energia, an energy-saving company, is building his business in another complicated environment. Traditionally, the utilities industries are controlled by strong monopolies backed by the government. Over the last decade, globalization and the growth of the startup ecosystem have galvanized even the government, however, as a result of which Mexico has taken trouble to create an environment that is investor-friendly. Yes, the country is still beset with poverty and drug problems amongst other issues, but many entrepreneurs are forging ahead, buoyed by an increasingly supportive startup ecosystem which has helped raise funds, educate potential entrepreneurs, build mentor networks and reform laws.
The story of Shaffi Mather in India really resonated with me because I am from the country and really sympathized with the tragic levels of corruption he faced in order to set up his emergency ambulance network Dial 1298. It mentions some of the country’s key figures over the last few decades, industrialists and policy people who have helped change the status quo for people like Shaffi. India’s problems are many but things are very much changing, and through Shaffi’s story you see how.
I was getting impatient to hear female voices in this book, and the sixth story met my expectations (I still wish there were a couple more female entrepreneurs featured). Yana Yakovleva was running her chemical trading business Sofex without much interference from the government till 2006, when she was arrested because her company had grown to the point that it had finally come to the attention of the higher-ups. I don’t know much at all about Russia, and it was fascinating to read about the environment there for entrepreneurs, who are probably the ‘social group that is persecuted most’, as Russia’s ombudsman for business rights says. Yana herself says that ‘the government considers business people in Russia criminals’. She eventually got out (many are not so lucky, dying in prison) after seven months, and set up Business Solidarity, an organisation that provides legal support to entrepreneurs falsely accused of crimes.
The last story is that of Lei Jun, the founder of Xiaomi, now one of the most well-known companies in the world, posing a serious challenge to the likes of Apple and Google in the East. How he grew the company from nothing to what it is now makes for compelling reading. I hear so much about startups in China today, but knew precious little about the funding environment there, which this story sheds light on. As Ms. Bayrasli says, ‘China’s leadership holds a firm hand over capital, monitoring its formation and allocation. It is part of a phenomenon that has come to be known as ‘state capitalism’, the antithesis of Adam Smith’s ‘invisible hand’. Under state capitalism, the government is the market: wealth of, by and for the state.’ That’s just a small part of it – things are changing now of course, but it is still not easy for entrepreneurs, so to have built a company as successful as Xiaomi, which embraces open source, is admirable.
I have tried to summarise a couple of the core lessons I took away from this book, a hard job given the vast ground it covers. Elmira Bayrasli has taken the effort to paint a clear picture of the background against which each of these founders started, sometimes failed, then re-started and got to where they are now, and uses hard statistics to indicate progress or failure on the part of governments as the case may be, which not many authors take the trouble to do. It is the combination of research and narrative that will make this book worth your while. Perhaps the best argument for it is one of my favourite paragraphs from it:
“Entrepreneurs, by the very nature of what they do – disrupt and innovate – provide a necessary check and balance on government that no one else can – not businesspeople, not NGOs, not civil society organizations. They help remake the social order and help move progress forward, giving rise to new ideas, new industries, and new possibilities and forcing change. That is what has made them both heroes and villains that many in power feel the need to keep in check.”
It’s what I sense week after week, as I write the Other Valleys as well, and that paragraph describes why I do it so accurately.
Congratulations, Elmira – travelling round the world to tell the story of these seven people must have been both a challenge and a joy. A job beautifully executed!
Thanks to Fred Wilson’s blog, I came upon this video where economist Ian Hathaway and Techstars founder Brad Feld talk about accelerators and useful tips for running a good programme.
I’m paraphrasing Brad here, but some best practices he mentions for a successful accelerator are:
Understanding what an effective mentor is and knowing how to effectively engage with them over a 90-day period (I have been and still am a mentor on a few accelerator programmes and cannot agree with this enough)
Having a rhythm for the programme that is absorbable by founders (so not too fast or too slow)
Getting an understanding with the founders that there will be stress and conflict and that’s part of the programme, as it accelerates learning (getting pissed off with feedback probably indicates you’re a bad founder)
Building a positive lifetime culture around the accelerator which feeds on itself and where people learn from each other
Some things to avoid:
Not helping mentors understand how they can be effective
Not setting expectations around the outcome of the accelerator (if a founder expects a seed round at the end of it and that’s not in your plan, that’s a problem that needs to be tackled at the outset not the end)
Not focussing on the people (as Brad said, the idea is what gets you in, but after that it’s all about the founders themselves as individuals; not all people are cut out to be founders)
Not having an approach around scale: how fast do you want to grow? Many accelerators stall as they haven’t figured out how to build a sustainable model (this is true for any business)
Not having a uniform POV around what you are trying to accomplish (I have faced this problem when multiple people are involved in a project, so Amen to that).
Over the last decade or so, technology has changed all of us, some more so than others, and crucially, some parts of the world much quicker than others. Access to technology is a core part of this, with the steadily lower cost of production putting technology into the hands of those who never had this privilege. This has changed behaviours, relationships – and governments.
Last year, I started a weekly newsletter called the Other Valleys to chronicle some of the inspiring creative and technology projects emerging from far-flung corners of the world that were not as familiar to the Western tech press as Silicon Valley might be. Kavi Guppta, who writes for Forbes amongst other things, thought this was a good idea too, and we got chatting online. That’s where the seeds of this project were sown: what are some of the best ideas that all of us, and people in public roles especially, should be paying more attention to? If we were part of a government in Asia, Africa or Latin America, most of whom are grappling with huge societal challenges, what kinds of tools might just help make life easier? Kavi and I decided to put some time and energy into exploring these ideas in a slightly more detailed manner.
‘Disruption in the Developing World’ is a short e-book that is the result of our collaboration. We’d like it to create awareness of some of the brilliant activities already underway across the world, and create debate about what might be able to be done better. If it then leads to even one person changing something somewhere to make life better for a group of people, we’d consider our time well spent.
You can download the e-book herefor a recommended donation of $2 (or more – hopefully you will think it is worth it); money that will go to organisations engaged in Nepal relief efforts. If you can, please spread the word to your friends and colleagues on Twitter and LinkedIn too – much appreciated.
Snapchat are partnering with Square Cash to launch Snapcash, through which US users over 18 years of age who own a debit card can make micro-payments to each other. Wired UK seemed to indicate in their podcast last week that Facebook might make a play for them, but I disagree. For one, it was reported earlier in the year that they are already looking at creating a similar service using WhatsApp. In any case, Snapcash isn’t the first instance of this service: WeChat started offering a similar money transfer service to its users in China over the summer.
The Snapcash ad below is very Willy Wonka & the Chocolate Factory-esque. Platform-wise, I like the fact that the service uses the $ symbol as the gateway to switching to transfer mode.
These are all really interesting events for the financial services industry, which is undergoing some pretty heated action and is poised to only get hotter. Tom Loverro, Venture Investor at RRE Partners in the US drew up this diagram of how finance is being disrupted there. I used it to model a very basic version of what is going on here in the UK, which is not as heated but not to be taken lightly.
The UK banks are banding together to offer mobile payment services like Zapp and Paym slowly but surely (I’d love to know usage figures, which I suspect aren’t that high yet), and of course Barclays is a leader in the retail banking space with Pingit (there was a very interesting presentation I saw by someone who worked on launching it at the recent Geek Girl Conference).
If I was running my own business, I’d work on trying to mock up a slide like this to see where I need to skill up and/or invest in.
From last year, but still a great read with lessons for platform managers/owners everywhere, drawing on lessons from the Kenyan government and their relationship with the Maasai tribes.
The policy: When a lion kills a cow, the Maasai don’t retaliate. Instead, they report and document the attack and the government replaces the cow. Additionally, the government shares tourism revenue with the Maasai by finding them jobs as drivers and tour guides, further incentivizing them. Maasai lion killings have declined, and tourists visit Kenya in droves for its beautiful lions.
The insight of Kenya reveals the solution for eBay. You encourage free shipping the same way you save lions: By understanding incentives.
Sellers have two main goals on eBay. First, they want more sales and higher sales velocity — all merchants want to sell more, and sell more frequently. Second, they want better margins. Merchants can either sell their goods for higher prices, or their fees for selling on eBay needed to be lower. The former was not going to work, because buyers don’t want higher prices, so we worked on accomplishing the latter and finding a way for the platform to change.
Last year when I heard about the launch of CentUp, I raced to get the button added to this site. There were many reasons – primarily that I think good writing and good ideas should be supported in some way beyond advertising. I’ve been a contributor to CentUp-supported blogs over the past year so I’ve had the satisfaction of recommending work I like beyond just tweeting about it.
Till now, you haven’t seen CentUp itself on this site because WordPress.com didn’t support it. That’s all changed as of today – hurrah! If any of you like the things I write about going forward, you have the opportunity to donate to charity and support me simultaneously if you have a CentUp account, by simply clicking on the button you should see at the bottom of a post.
By way of background, CentUp was created to do good and pay content creators for their efforts at the same time. It smashed its 2013 Indiegogo goal, and launched soon after. It’s a great way to discover content appreciated by others in the ecosystem as well (read their Creators + Tech series and subscribe to their email if you’re interested).
I had a quick chat with Len Kendall, one of the founders, earlier today. Here’s what he says about their journey over the past year:
Over the course of the last year, the CentUp has refined who our core customer is. Instead of trying to help content creators across all platforms, we’re hyper-focusing our attention on writers. Unlike Youtubers or Musicians who can more easily sell goods or run ads, writers specifically have a really hard time monetizing their work. People (all of us) simply aren’t used to paying for writing anymore. As such, we decided that writers were the people CentUp should work hardest to support. We’ve evolved our platform in the last 6 months and tie every single donation not to a person, but to a specific piece of content. So unlike a PayPal donate button that’s used to contribute money to a person or team, CentUp lets readers financially support (or tip) the one piece of writing that truly inspired them. By tying donations to individual articles (versus overall publishers), we’re also aligning with how modern day readers use the web: they jump from site to site, and don’t commit to any one publisher.
Glad to see the CentUp team going from strength to strength!
I often get asked what the main information sources I read are. While most of them are pretty standard for anyone working in media and technology in this part of the world, lately I’ve been feeling a gap in my own knowledge when it comes to information from other parts of the world in these areas, especially given my personal interests in that region.
Over the last year or so, a number of interesting sources of information have launched online: The Next Web’s Jon Russell has an Asia-focussed newsletter, Bill Bishop’s Sinocism newsletter paints a valuable multi-hued picture of China, Quartz now has an India edition (and their Daily Brief email focussing on the region), and Your Story publishes news stories from across Asia and South-East Asia, to name a few. Of course there are also the more mainstream outlets like the Economist, Time, Harvard Business Review and so on. But what I was looking for was something beyond just the big news stories of the startup and communications industry outside of the West – it was information on the lesser-known companies and projects, albeit rooted in tech, that are disrupting markets across the world (and outside of just India/Asia). And also, information on companies in those parts of the world not founded by men (refer to Ada’s List).
So a while ago I started creating a list of these companies. And then I figured that writing a weekly newsletter would not only help me keep track of the most interesting non-US/UK/EU projects across the world in a more memorable way, it might also be useful for some other people (five of you, maybe ten, I don’t know).
So if you’d like, pop in your email address and see if what I find is interesting to you. It won’t be more regular than weekly (I only wish I had the publishing proclivity of the brilliant Dan Hon or the detailed perspectives of Frederic Filloux and Jean-Louis Gassée, but you have to go with what you have eh) so you won’t have to worry about me spamming your inbox.
I figure short and sweet is a good way to start – so each Wednesday expect a list of no more than a handful of companies that are interesting to me, based in or focussed on areas outside of Silicon Valley and Silicon Roundabout – you know, those Other Valleys.
This week I had the opportunity to hear TechStars London programme manager Tak Lo speak about his experience and work to date. I especially enjoyed hearing about his learnings from his days in the US military and his experience of being a failed entrepreneur (the evening was about what entrepreneurs needed to know in the first 3 years).
The TechStars team are lucky to have him on their side. Here’s what I took away:
1. Scratch your own itch: the first startup he built was in the field of travel, about which he knew not much but had great ideas. The startup tanked. You’re likely to have most success when you build something in an industry whose problems you’re familiar with. Not always, but mostly.
2. Find a team that can guide you against getting blocked by blind spots. Find the unknown unknowns. To quote Donald Rumsfeld:
Reports that say there’s — that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things that we know that we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns, the ones we don’t know we don’t know.
3. Find mentors who can listen to you and advise you, both personally and professionally. You’ll probably need both. This could be a spouse or partner in your personal life, and someone with years of experience in what you do professionally.
4. Try and fail as a team; try not to lose the institutional knowledge you build. Think about the OODA loop.
5. Have grit; don’t give up till you have to. It will not be easy and you’ll feel like throwing in the towel more than once. Think about babies, who learn through doing. Keep doing, keep learning, and move ahead.
6. Know your boundaries. Know when you need to stop accruing personal debt (with friends and family you will probably not see for months) and financial debt (what is the absolute maximum you can draw on your overdraft or other loans before you start drowning in debt?)