Posts from mobile

The Mobile Downturn

I woke up to this post by Chris Dixon in my Tumblr. Chris states:

Apps have a rich-get-richer dynamic that favors the status quo over new innovations.

He’s right about that and he’s right about a bunch of other things in his post as well.

We did a portfolio review at USV yesterday. We spent two hours staring at our portfolios on the big screen in our main conference room. We have three early stage vintages that are fully invested, 2004, 2008, and 2012. We talked about the macro environment during which we invested and developed these three portfolios and there was a palpable sense that the wide open period of innovation during which we invested the 2004 and 2008 funds was not as present in the 2012 fund investment period. We have a bunch of great investments in the 2012 fund, but we took safer bets and the result will likely be more wins and less strikeouts but also less home runs. Did we change our appetite for risk in our most recent early stage fund? It wasn’t conscious. We didn’t change our investment strategy. We didn’t tell each other that we wanted to take less risk. But it sure feels like we did.

My partner Brad hypothesized that it had something with the rise of native mobile apps as the dominant go to market strategy for large networks in the past four to five years. So Brian pulled out his iPhone and I pulled out my Android and we took at trip through the top 200 apps on our respective app stores. And there were mighty few venture backed businesses that were started in the past three years on those lists. It has gotten harder, not easier, to innovate on the Internet with the smartphone emerging as the platform of choice vs the desktop browser.

Chris mentions something else in his post that, to me, is a big bright spot on the horizon:

Most worrisome: they reject entire classes of apps without stated reasons or allowing for recourse (e.g. Apple has rejected all apps related to Bitcoin)

Let’s go back and revisit the big innovations on the commercial Internet over the past twenty years. TCP/IP, HTTP, The Browser, Search, Social, Mobile, Blockchains. Each one of those innovations drove an investment cycle. Our 2004 fund was built during social. Our 2008 fund was built during social and the emergence of mobile. Our 2012 fund was built during the mobile downturn. And our 2014 fund will be built during the blockchain cycle. I am looking forward to it.

My friend Adam tweeted this in the wake of my The Search For The Next Platform post. I don’t know if it was a reaction to it, but that’s how I interpreted it. I agree completely with Adam.


In tech investing, we get booms when a new cycle emerges and downturns as it matures and consolidation of economics happens (think Microsoft in the late 80s/early 90s). The downturn is always followed by something radical and new that starts on the fringe and becomes mainstream. Timing all of these things is hard. But it is what we have to do.

The a16z Podcast

This showed up in my SoundCloud stream over the weekend. I finally got around to listening to it this morning.

The iOS vs Android debate certainly does seem like old news, but what happens next is a super interesting topic. The first part of this podcast is about iOS vs Android, but the second half gets into more interesting territory.

I like that Andreessen is giving Benedict the opportunity to build an audience on multiple platforms. I am not sure if this is Benedict’s podcast or if we will see others, like Marc, Ben, Chris, and the other Andreessen partners on this podcast. But regardless, this is yet another great information source coming out of the VC business.

The idea of a VC podcast is not new. Bijan and Nabeel at Spark have been doing this for a couple years. You can listen to a bunch of their podcasts here.

Hangouts and SMS

This post will be meaningless to all of you on iOS. But for those of us on Android, read on.

At some point last fall I was prompted to and agreed to make the Hangouts app the default SMS app on my phone. That replaced the default Android SMS app which then also somehow disappeared from my phone, probably in some Android OS update.

From day one of using Hangouts as my default SMS app on Android, I have been unhappy. Hangouts is a slow and clunky mobile app. That’s the antithesis of what an SMS app should be. Its unclear how to do all sorts of things in Hangouts like find a contact and send a message. And I’m always finding myself being pushed to do a Hangout when all I want to do is send a text.

In general, mobile apps should not try to do multiple things. Less is more on mobile. Google made a big mistake trying to merge two fairly different and important features into a single app.

But the biggest problem is the load time on launch. It often takes a minute or more to launch the Hangouts app on my phone. Maybe there is something wrong with my phone (memory, storage?) but I know I am not the only one with this problem so I think the Hangouts app is a problem for many.

This morning I finally hit the tipping point. I was in a cab to LaGuardia and I saw that my daughter had sent me a text last night. I clicked on the notification and waited and waited and waited to see her message. In the midtown tunnel, I went to the play store, searched for SMS apps, picked Chomp, downloaded and installed it, and then made Chomp my default SMS app in settings.

I think its possible that I did all of that faster than Hangouts could show me my daughter’s text. But once Chomp was installed and set as default, I was shown her text instantly.

The Chomp experience is so much better than Hangouts that I quickly sent out an email to a few friends who are on Android and have told me about their frustration with Hangouts. And after flying to Boston and finding a comfortable coffee shop, I am now telling all of you.

If you are using Hangouts as your default SMS app and aren’t happy, take a few seconds to download a free alternative. Chomp is great but I am sure there are others that are also great. I promise you that you will be happier. I certainly am.

Video Of The Week: Benedict Evans InContext Keynote

Arnold and Andrew suggested I watch this last week. I finally got around to it and it is great.

I think everyone knows how much of a Benedict Evans fan I am. This video covers a lot of the most important topics of the time we are in.

Sidecar

While we believe in network effects and the defensibility and leverage that comes from them, we have never subscribed to the popular theory that one single company can leverage network effects to “run the table” on a large market on the Internet and Mobile.

Certainly Google has largely done that in search and yet there are still several smaller players in the search market in the US, there are a number of regional search leaders around the world, and there are search engines, like our portfolio company DuckDuckGo, that compete on the basis of privacy or some other vector that Google chooses not to compete on.

In e-commerce, many think that Amazon is a force that cannot be reckoned with. And yet there are many successful e-commerce companies that have been built over the years. And there are new e-commerce companies being started every day.

In social networking, many believed that Facebook would be the only social network that mattered. As far back as 2007, I argued on this blog that we would see many social networks emerge offering different social graphs, user experiences, and use cases. We successfully invested in some of them, including Twitter and Tumblr.

In the mobile transportation market, which we believe will be a very large global market opportunity, many believe that Uber will run the table. And it certainly looks like they are doing that right now. It reminds me of the juggernaut that Facebook looked like five years ago when everyone thought they had won the social networking market.

But we believe that there will be a number of meaningful companies built in the mobile transportation market, just like there have been a number meaningful companies built in all of the really large markets that have developed on the Internet and mobile.

We have had an investment in one of these meaningful mobile transportation companies, Hailo, for a couple years and they have leveraged the existing taxi cab market to build a very large mobile transportation company operating in some of the largest cities in Europe and the eastern US, where taxi services are well established and work well.

And last summer, we made a second investment in this sector, in Sidecar. At the time of that investment, Sidecar was planning a significant change to their strategy and product to deliver a true marketplace experience to the mobile transportation market. We agreed with the company that we would keep our investment private until they were ready to launch the new product and strategy.

Well today, Sidecar has launched its new product and strategy and with that, we are announcing that USV is an investor in Sidecar. We are very excited about the marketplace model and what it can bring to drivers and riders in the mobile transportation market.

Om Malik wrote a post on GigaOm a few weeks ago that foretold this new strategy, although I don’t believe he knew about it or had been briefed on it. He wrote:

But this efficiency over the human touch is also an opportunity for Uber’s rivals

The human touch means not turning car owners who want to make a bit more money into limousine drivers. The human touch means allowing a driver to choose when and where they drive. The human touch means allowing drivers to market themselves in the app with a picture and a little bit about them and their car. The human touch means allowing the drivers to change their pricing whenever they feel like it.

The human touch means allowing riders to see the drivers in app and choose the one they most want to ride with. The human touch means giving the rider a real fixed price instead of some multiplier that goes up whenever you most need a ride.

When Sunil Paul, Sidecar’s founder and CEO, laid this out for me and my partners last summer, I immediately thought of Etsy vs Amazon. I use Amazon all the time. It’s a great service. I get the lowest price, quick delivery, and confidence. That’s the Uber model. But I also use Etsy all the time. At Etsy, I get something unique and personal. I get to buy directly from the seller. I get to have a conversation with them. I can favorite/follow them and get notified whenever they post new stuff.

Amazon is efficient and Etsy is personal. There is room for both of them to build big businesses in e-commerce. Uber is efficient and Sidecar is personal. And we believe that there is room for both of them to build big businesses in mobile transportation.

If you live in the the Bay Area, Los Angeles, San Diego, Seattle, Chicago, Boston, Washington DC, or Charlotte, you can try out the new Sidecar marketplace experience.Download the app and give it a try. It won’t be for everyone, but I bet there are a lot of people out there who will really enjoy the human touch of Sidecar and use it frequently.

Hypercard – Way Too Early

I have always loved the name of my friend Howard Morgan‘s now dormant blog - Way Too Early.

Some ideas are just way too early. And one of them was Apple’s Hypercard, which was a Mac application that came with a built in programming language. The interface was a series of cards that were mini apps inside of the Hypercard application. I built a few Hypercard based applications in the late 80s and early 90s as I was winding up my programming “career”.

But as I look around the mobile landscape, I see cards everywhere. Benedict Evans wrote a good post about this trend a few weeks ago. Google is pushing cards as a UI inside Android and their Google Now UI is the best example of that. Twitter has had cards inside of Tweets for several years now, although I wish they would display them by default in my timeline. The Facebook mobile UI looks like a series of cards, although you can’t really do anything with them, yet. And, of course, my favorite example are theKik Cards that are mini mobie web apps that run inside of Kik’s messenger. I’ve blogged about them a number of times here at AVC as Kik is a USV portfolio company.

It feels like the Hypercard metaphor has arrived as the atomic unit of content in mobile, both inside of native apps and, if Kik is going in the right direction (I think they are), as the default mobile web atomic unit (cards instead of pages).

The problem with the native app environment is that there are things you cannot do inside of a card without violating Apple’s and Google’s terms of service. If Facebook wanted their cards to allow the purchase of music or video natively in the card, well that would not be possible in the current regime.

On the mobile web, that is different. You can do anything you want in a browser, even if that browser is on iOS or Android. That’s a legacy of the desktop web and it’s a damn good thing. Innovation happens best when there are few if any limitations on what you can do as a developer.

So keep your eye on cards. I think Apple was on to something important from a UI and usability perspective thirty years ago when they started building Hypercard. It is now coming to life again on mobile and I think this will be the most interesting battle ground on mobile in the years to come.

Feature Friday: Recognizing Wine Labels

My son turned me onto a wine app called Delectable Wine. I am waiting for the Android version so I can use it too. But I’ve used it a bit on his iPhone and its a really nice and useful application.

Think of Delectable Wine as Instagram for wine. People post the wines they are drinking, their reactions, tasting notes, etc. You follow your friends and experts (likeArnold) and you see what they are drinking. You can tag where you had the wine and what you thought about it. There’s a really nice searchable archive so you can go back and see what the wine was that you had at Perla that night with your friends that was so good.

But all of this is possible because of a very cool feature that my son calls Shazam for Wine Labels. When you want to add a wine to Delectable, you take a photo of the wine label and Delectable figures out what wine it is, what vintage it is, etc, etc. All of that important metadata comes in automatically just because you took a photo of the wine label.

I don’t think Delectable would work nearly as well without this feature. It enables so much of the discovery and data that makes the app so great. The first time I saw it in action, I said “wow”. I see a lot of technology demo’d every day. I don’t saw “wow” that often. But I did when I saw Delectable in action.

If you are into wine and have an iPhone, try it out. I think you’ll like it.

The Behavior Of Your Users Normally Doesn’t Change Overnight

A few weeks ago the traffic coming to the new usv.com dropped off by 20 or 30% week over week. Brian and Nick were wondering if it was related to the new design we rolled out at the end of January. They decided to take a deep dive into our analytics to see what was going on.

I told them it had to be some sort of plumbing issue. Something that was hooked up to usv.com must have gotten unhooked. Because I have rarely seen the behavior of an entire user base change drastically overnight because of something like a redesign. Change can come pretty quickly, but in my experience it is months not weeks or days for something to drastically change in your user base resulting from a subtle product change/tweak.

They noticed in the analytics that front page views were steady but traffic to the article pages was off by a lot. I suggested that something in our twitter plumbing was off. And sure enough, we figured out that the autoposting of popular articles on usv.com to this twitter handle was broken (it is actually an RSS issue that is being fixed today).

I tell this story because we all encounter this sort of thing along the way of building and launching and growing a product. We make tweaks and something changes right away. That immediate change is usually related to something that brought traffic (google, twitter, rss, email, appstore) and not a design change. More gradual changes (up or down) are usually because of design changes.

There’s a difference between these two kinds of effects and it is important to understand that.

Feature Friday: Kik Browser

On wednesday, our portfolio company Kik added something to their very popular mobile messenger – a browser. I guess a browser can hardly be called a feature. But inside a mobile messenger, a browswer can become a feature.

Now when you find a song in soundcloud that you want to send to a friend, you can pull it up in the kik browser and kik it your friend who can listen right inside kik, in the browser.

Here’s what I did this morning:

I opened soundcloud mobile in the kik browser

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I found the new Dale Earnhardt Jr Jr mixtape:

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And I sent it to Ted Livingston, Kik’s founder and CEO:

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Now Ted can listen to the mixtape right inside of Kik.

This works for anything that can be rendered in a mobile web page, an item on Etsy, a place on Foursquare, a stock quote on Google Finance, a search result on Duck Duck Go, etc, etc, etc

You can download Kik here and check it out.

I believe that the mobile environment lacks the native virality of the web. With a mobile messenger and the mobile web inside of it, we can get back to that place on mobile. So this is exciting and very promising to me.

When Siri Takes Over Your Phone

One morning earlier this week, I came down early and was working in our family room/kitchen area. My oldest daughter was charging her iPhone in the kitchen and it was randomly playing music. I would get up, turn off the music, and then a few minutes later, it would start again. Eventually I turned off the phone.

A bit later, when my daugher came down, she was in shock, her phone had randomly called dozens of her contacts on its own over the night.

So I took a look at her phone and it seemed that voice control had taken over her phone. I googled around to see what could be done and came up with this support forum thread. It explained that we could turn off voice dialing which we did, so that she would stop randomly dialing her contacts. But we were not able to turn off voice control entirely.

She’s in Park City this week so when she gets back to NYC, she will take the phone into the genius bar and get it fixed. But until then, Siri is controlling her phone. Randomly playing music when she doesn’t want it. Randonly facetiming people she doesn’t want to talk to. It’s a glimpse of the future to when AI goes haywire on us. It is not pleasant.