Highlights from Ben Thompson Dinner

Along with Semil Shah, my colleagues and I at GGV Capital hosted a dinner last night with Ben Thompson, the brilliant thinker behind Stratechery.  The conversation was far reaching and the event was a lot of fun.  Semil and Connie Loizos of StrictlyVC have also written good summaries of the event here and here.  I took some notes and a few of the highlights for me included:

  • People in tech tend to systematically under-estimate the value of small conveniences and the elimination of inconveniences
  • The iPhone’s value is going up with healthKit, homekit, Apple pay, etc but all of these services will be even better with a watch
  • The Apple Watch must be so useful because of pain of charging it daily; Apple knows this and that’s why the first version is likely to be more like a typical version 3 or 4
  • Messaging in China is so critical because it is the operating system.  It doesn’t matter if you’re on iOS or Android, what matters is that you’re on WeChat
  • The iPod can be used as a clue for the success of Apple Watch.  It succeeded because it said something about you.
  • The rest of the world, especially developing countries, are mobile first markets. Chinese companies are better positioned than US companies in these markets because they were born mobile first.
  • Xiaomi – US companies tend to view the whole world as one market versus segmenting the market. Xiaomi met the young tech geek at a price point that made sense for this person.  That is a critical component of their success.
  • Facebook offering bandwidth for free – dominate media content consumption. Even more than in the US, Facebook is able to dominate more outside the US.
  • FB is the most under-estimated tech company even here in SF.  They have so many opportunities and levers they can pull.
  • On the other hand, Google creates transactional experiences, but seeing Meerkat blow up because of the immersive nature of it tells you that transactions aren’t the only moment of value.
  • Uber – there is no real bear case unless Google pulls off self driving car. 70% of Uber cost is drivers. Network effect of liquidity and consumer preference is strong. Uber will make money on extras like airlines – utilization of the unsold capacity for delivery.
  • Our kids will use the systematic under-estimating of Uber’s marketsize (comparing it to the taxi market) as a case study in the future of mis-understanding the potential for innovative companies.
  • Mobile saved Facebook. Advertising companies aren’t good platforms.  Platforms have to allow for other companies to stand on them.  With advertising, you’re competing with your potential customers.

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Glenn Solomon