As professor Zhu said in class – companies have been saying that VR is the next big thing for a few years, and everyone is still waiting. Vertebrae’s success is definitely strongly correlated to the entire market. If VR doesn’t take off, I don’t see Vertebrae’s business model good for anything else really.
Good call! I like the “ad removal” paid option. Could work extremely well with those guys.
Great post. I totally agree with David above; I think the hardware side that is, performance-wise, sufficient for education will arrive fast and will commoditize just as fast. Real value will be in content – and I just wonder how differentiated/high-margin that can be in the education industry.
Great post – love it!
For Field 3 we had a (failed) VR startup, where A LOT of people complained about sickness – so it is a real struggle for sure! I still can’t play many FPS games because I get sick to my stomach. As its own value proposition, it’s a strong one, but I wonder if it’s enough compared to other HMDs who bet on quality, brand, and a sharp image.
Super interesting post, Boris! Give it up for Israel!
If VR can tap into the health industry, it’ll be one hell of an achievement. I wonder if there are any startups focusing on eye exams. I can totally see optometry being disrupted here almost instantaneously.
Agree that the dilemma is real, and Netflix solved it in an amazing way. I’m worried though that Netflix’s success is only limited to TV; can you imagine something similar in the app world?
Thanks for the comment, J 🙂
I think that any company that builds a business with the sole purpose of being acquired by someone who has the resources to make a better product from scratch is playing a risky game. In my humble opinion, VB’s only advantage can come as a first mover; if they can generate a strong consumer base, they’ll be purchased and not copied.
Thanks, Daniel! Love this post. Especially the part on “can this be copied to traditional journalism”, which we touched on earlier the semester in class. I truly wonder if a real credible news source can rely so heavily on what users click on; it seems like the misalignment is inherent in our human flaws. I often click and read useless articles just because they are more flashy.
From the data perspective, I think Google News is an interesting attempt to use data and one’s surfing habits to personalize news for them. I find myself using it more and more these days, and it gets better with time.
That is super interesting, Seunghyun!
One thing this makes me wonder – Bruce Schneier is an HKS professor and security professional. He says that the risk with deep learning and big data is that they could easily become a laundering tool for bias. How can the predpol system make sure it is not based on data that is biased prematurely against a certain demography? The risk of misunderstanding causation and correlation seems huge here.
I love this post, Yun! I think it truly grasps the power big data can offer.
With regards to “Starbucks evenings”, I wonder, however, if it may create second-tier effects that may not be apparent using the current data, such as attracting unwanted customers (by serving alcohol) and bringing the value down for those who are used to a unique section-oriented exclusive offering.
Thanks, Daniel! I agree the 1bn valuation is crazy, but many of us use Glassdoor quite often.
In a quick back of the napkin calculation: let’s assume a company has to pay 10% of the first year salary to a headhunter. The average US salary is $50k, let’s assume $70k for Glassdoor because we’re still more tech-oriented, etc. That’s $7k per job posting that the employer is willing to spend to avoid headhunters. That’s about 140K companies on Glassdoor to reach $1bn in revenue, or when factoring lifetime value etc, about 70k. I think thats a fairly reachable number.
Thanks, Yi! This reminds me of Ashley Madison, the cheating website, that was free but charged users $20 to delete their profile (and later suffered from hackers and other bad PR) – I looked briefly but couldn’t find any for-charge bad-review deletion mechanism, even though it could be a good solution… 🙂
Great post! I remember when Waze just started in Israel, before the smartphone era but when GPSs were still there. I LOVED using it on my Motorola, recording roads that haven’t been recorded yet, etc.
When they were sold, the active Waze users-recorders community was very upset that they weren’t getting any equity, which raised many questions on what is right/just and should people monetize from data that was crowd-sourced.
Great post! On the topic of displaying emotions and learning from others, my mother (shameless self-advertising) wrote a fascinating paper on the basic building blocks of how to design AI emotions:
I think the one lesson Microsoft didn’t realize is: It is hard to engineer anything that one cannot precisely define, and – it has been shown that exaggerated abuse of emotional outputs like the above could irritate users.
Thanks, Jess! I couldn’t agree more with your analysis on the different value proposition. I wonder if there’s a situation where both will not converge but rather coexist; it all depends on what Microsoft plans to do with LinkedIn…
I didn’t know Blind but it looks very interesting from the perspective of anonymity (other than the work email which might be a growth blocker). The whole fight of the pros and cons of anonymity is a very interesting one. My sense is that the internet has become less and less anonymous over the years (Almost every website requires a first and last name today; most websites in the past only asked for a handle/nickname and that’s it)
“on Slickdeals, there are literally fanatics who have years of data on bath tissue sales”
Such a great post, thanks Yun!
I wonder how Slickdeals could become more of a mainstream shopping portal rather than a site for the toilet paper lords of the world. They need a very Slick ad campaign…
Great post, Cathy! Very interesting company, especially in the Chinese scene. I wonder what their conversion rates are. Is the willingness-to-pay / contribute / donate for valuable information a strong thing culturally in China? I know it is in the US, but in Israel, for example very few people would retroactively pay for something they already received for free.
Great article, Bonnie! Given the intimate nature of the topic discussed, I think virality will be hard to achieve. We had a case with a similar problem in another class – where a face-photoshop app couldn’t gain virality because nobody wants to let all their friends know he/she ‘fixed’ their smile.
Thanks for the comment, Yun! Unreal is VERY intuitive to use. I was actually quite surprised with Unreal’s low market share compared to what I thought it was. Unity is really gaining a strong fan base.
Great posting, Boris! Do you think Steam could/should go Mobile? Or is that too massively controlled by the App Store and the like? How about introducing tools (not only games) on the pcs/macs?
Great article, thanks!
1. It’s interesting to think of Steam Greenlight (community voting for new games) as a way to create Network Effects / virality and increase the value of the platform.
2. Can Steam’s platform be leveraged to the business world? (I’m thinking Slack/gamification of the work environment with easy installations, external update pushes and rankings)
Indeed, before IDI showed up people only used agents. In fact, it was (and still is) the law. What IDI did, from what I understand, is they used a “loophole” to create an umbrella of one ‘agent’ that everyone is under, when in fact that agent “delivers their service” through the app/call center representatives. That was the reason for the litigation discussed in the post, that ultimately prevailed.
The question on data ramp up is an interesting one. I would assume they took the RCTOM Team New Zealand America’s Cup approach – started with a general ‘best practice’ and used technology to refine the process. However you’re absolutely right that this must have been a huge challenge! The question is, like Bonnie asked above – is this enough to gain a first mover/scalability advantage over competitors? For now, the answer seems like it’s a “yes”…
Great question, here are my thoughts:
1. I think IDI’s first mover advantage is not negligible: their algorithms that optimize the differential pricing are well established and draw their power from the large amounts of data that they have.
2. Also on scalability, I think the unit economics in direct insurance only start making sense at a certain number of customers (because you have to maintain an app, call center, etc.). We have to remember that unlike the US, the Israeli market is rather small (~7m citizens), non-consumers are scarce, and there are very few industries in which there is room for more than one winner. Copycats may face a problem – unless they come up with another disruption mechanism.
3. Strong, very strong, brand: their ad campaign wins pretty much every year the award for best ad, funniest campaign, most remembered, etc. Think about Geiko-level ad spending, but with a very efficient viral campaign that everyone talks about.
A real winner – great article!
I think the only real challenger in this field in the past years was Waze, who were acquired by Google for $1.3B. I’ve always wondered why Google, ever since the purchase, has still decided to maintain two platforms and not close one of them; functionality is almost identical nowadays! What are your thoughts?
Great article and thanks for the insights!
I am curious, you are mentioning the current market control of MobilePay in Scandinavia and the trouble Apple Pay will have there. As the incumbent, MobilePay indeed has more customers but to me it seems like switching costs on payment mechanism are fairly low (unlike switching an actual bank, or using a new chat system with a user base). Do you think the early entrance is such as significant advantage? I’m wondering if Apple can’t just bulldoze everyone to victory.
Great article and very enlightening, thanks!
I am trying to think about whether or not this is a unique concept to China. We saw similar failed attempts of American companies to conquer the China internet market (Facebook banned even before it started, but also Google and even Amazon). Do you think other companies, with a less centralized governing system, are capable of replicating this defense mechanism?