Visa Invests in Stripe at $5 Billion Valuation and Strikes Commercial Deal, Too →

The companies will also work together to make new digital payments experiences possible, though neither side had many details to discuss. Lastly, Visa plans to help Stripe expand quicker in emerging markets where the credit card company has strong relationships with other financial institutions.

Credit card processors could you more competition in emerging markets. In Colombia you need to pay close to $1k to enable recurring payments – ridiculous.

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Google Wants a Piece of Air-Traffic Control for Drones →

Alan Levin for Bloomberg Business:

At least 14 companies, including Google, Amazon, Verizon and Harris, have signed agreements with NASA to help devise the first air-traffic system to coordinate small, low-altitude drones, which the agency calls the Unmanned Aerial System Traffic Management. More than 100 other companies and universities have also expressed interest in the project, which will be needed before commercial drones can fly long distances to deliver goods, inspect power lines and survey crops.

Hopefully this system will have government oversight but not be operated or controlled by it. Decentralization of the system is key to foster innovation in a quickly evolving space like this.

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Speed as a Habit →

Dave Girouard writing for First Round Review:

I’ve long believed that speed is the ultimate weapon in business. All else being equal, the fastest company in any market will win. Speed is a defining characteristic — if not the defining characteristic — of the leader in virtually every industry you look at.

Decisiveness is so critical to a success of a company that I worry when a decision falls through the cracks at Koombea or when we’re working with a founder or product manager that can’t make up her mind.

The most important thing to remember is that you don’t have to live with most business decisions for a long time. If you are doing things right, most desicions will be obsolete within a matter of days or weeks.

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Apple reportedly joins talks with cell providers to launch new ‘e-SIM’ cards →

This would be a welcomed feature. I carry a small pouch filled with SIM cards.

The idea behind the talks is a universal standard for embedded SIM cards (“e-SIM”) that are built into the phone and not user accessible. These subscriber identity modules would allow customers to sign up for service on any network they wanted, then allow them to switch at any time (obviously with some limitations placed by the carriers).

The one caveat is that most carriers suck at anything software. Case in point: Movistar in Colombia hasn’t implemented visual voicemail, eight years after iPhone’s debut.

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Apple Reports Record Third Quarter Results →

The Company posted quarterly revenue of $49.6 billion and quarterly net profit of $10.7 billion, or $1.85 per diluted share. These results compare to revenue of $37.4 billion and net profit of $7.7 billion, or $1.28 per diluted share, in the year-ago quarter.

Compared to Microsoft and Google’s $22.2 and $17.7 billion(respectively).

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The Angel VC: The evolution of the SaaS landing page →

Christoph Janz on the evolution of SaaS landing pages:

When you look at the landing pages (or homepages or marketing sites, however you want to call them) of today’s SaaS companies, they usually look quite beautiful. They typically have a clean, simple and friendly look, with very little text and a lot of images or videos. In many cases, these websites could just as well advertise a consumer product. This doesn’t come as a surprise, since the consumerizaton of enterprise software has been one of the most important driving forces in the software world in the last years. But B2B software websites haven’t always looked like this and it’s fascinating to see how much things have changed.

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Google’s product strategy: Make two of everything →

Found this on Hacker News after I posted the previous link about Google’s cost cutting. Ron Amdeo from Ars Tecnica wrote this back in October 2014:

Google likes to have multiple, competing products that go after the same user base. That way, if one product doesn’t work out, hopefully the other one will.

Throwing shit at the wall to see if it’ll stick will work eventually but not the best strategy.

This multi-product approach is good for Google’s long-term health, but it also wastes a lot of resources. There is duplicate work going on all over the place, but if Google is flush with anything, it’s resources. Adsense and Adwords bring in so much revenue that, for now at least, the company can afford to be wasteful.

Guess it didn’t take long for this strategy to become wasteful. This reflected lack of focus, not a “hedging your bets” strategy. Curation is the most important thing about product design. Having multiple products you offer competing against each other is not “healthy competition”. It’s a sign of lack of unified product vision across the company.

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Google Takes Stricter Approach to Costs →

Alastair Barr on why Google is planning more stricter cost cutting over the next few quarters:

Google revenue grew 19% in 2014, down from 21% in 2013, 22% in 2012 and 29% in 2011. But operating expenses grew 31% last year, according to S&P Capital IQ; spending on research and development soared 38%.The result: operating-profit margin declined to 32%, from 38% in 2011, according to Goldman Sachs.

The company has matured and still relies on a single product for the overwhelming majority of its revenue. In contrast Apple has managed to deversify much of it’s revenue – even though much of its growth is still tied to iPhone.

Initiatives like Google Glass, Project Loon, Google Fiber, robotics and self driving cars are clearly the future. With that said, the fact that they are far from being able to monetize them plus the sheer amount of these moonshot type project makes them look unfocused. Pressure from investors was bound to happen as growth has started to slide.

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Wearables

I’ve been using the Apple Watch for the past few weeks. Before that, I hadn’t worn anything on my wrists in over 15 years. Although I don’t quite understand the implications of wearables yet, I know there’s something there. The obvious use case is small, micro-interactions through notifications like a message from my wife saying she’s on her way, and being able to acknowledge that with just one tap. Being able to check my flight status or upcoming meetings is cool and pretty useful too, but I don’t think that’s how wearables are really going to impact our lives. 

Wearables represent the first step of a revolution that gets us closer to being hyper informed, not only on what’s happening in our digital world but more importantly, what’s happening in the physical world. How we interact with both will change thanks to readily available wearables and increasingly connected devices around us. 

As Ben Thompson wrote a few months back:

To fully interact with this sort of software-enabled environment, I will of course need some way to identify myself; for all the benefits of the human body, projecting a unique digital signature is not one of them. The smartphone clearly works, but it’s not perfect: the more you need it for interacting with your environment, the more noticeable is the small annoyance of retrieving it from your pocket or handbag.

 A wearable is different, particularly if it’s on your wrist: simply raising your arm is trivial. This makes it much more likely you will actually interact in a meaningful way with software-enabled objects around you, which makes even having said objects much more likely. To put it another way, I don’t think it’s an accident that the two hot new technologies are wearables and the Internet of Things; they are related such that each is made better by the other.

Being able to pay without pulling out my wallet, or the option to scan my boarding pass with a watch, is only the beginning of the bridge between us and the physical world around us. Many of these things were possible via smartphones but we can now accomplish them without going out of our way. To some extent, we are seeing the first steps of a warable revolution, similar but more impactful than the smartphone one. Using technology to augment oneself with the world won’t be confined to people’s phone. This means that we now have an opportunity to create completely new applications to solve inefficiencies that weren’t possible before. 

In hindsight, Apple and Google have been laying the groundwork over the past few years with technology such as iBeacons (built on top of something as widespread as Bluetooth), indoor mapping, personal identity, Apple Pay and the Internet of Things. When you bring these together, the possibilities for personalized physical interactions on a massive scale are endless. 

Brands should take note. If smartphones are able to alter consumer behavior buried in our pockets, then wearables will accomplish even more. I wrote more on this in the Koombea blog.

Don’t scratch too hard

As kids, we’re told not to scratch if it itches, since it will just make it worse. As entrepreneurs searching for problems to solve, we’re told the exact opposite. We could build better products by solving our own pains, since we’ll know the problem better than anyone. Paul Graham calls this organic ideas. Besides, how convenient would it be to be your own target market.

In plain sight, this strategy seems to be what worked for several companies whose founders merely wanted to solve an annoyance they had. It’s easy to assume that, that’s all they did to validate their idea, but it’s probably not the full story. Hence, many people use this thought process to skip what could be considered uncomfortable and redundant: talking to others about their problems, and making sure that they are feeling the same pain points you do.

People that build stuff aren’t “normal”, because they’re usually power users. Whatever solution is in the market for a particular problem is probably not good enough for us, for any number of reasons. So, we revert to going out of our way and building a new product outright, in the hopes that other people will find it valuable like we did. Why wouldn’t they, right?

Here’s where things go sideways: by not validating properly, we end up building a more complex product than what people actually need. More importantly, we’re blind to see the workarounds which people use to cope with the problem we’re solving. Most of the time, their workaround is good enough for them not to need our super sleek, elegant app.

While doing potential customer interviews, it’s important to find out if the problem is important enough to get people excited by a brand new solution. If your results are ambiguous, or they don’t really care, either way, you’re probably not hitting the right notes. When this happens, stop! It’s a slippery slope from there.

I’ve fallen into this trap before, and, without realizing it, I’ve been blinded by the lure of finding the best solution possible, when, in reality, nobody cares about it at all. It’s hard to escape this habit, but, it’s one we’ll need to drop in order to build products that can grow considerably. Simple apps should be easy to use, but, more importantly, your users should be able to explain what it does to others without much difficulty.

There are dozens of examples of power users that have created simple, yet powerful products that have had massive adoption.