Almost every request I get for my BMW Z3 on RelayRides comes with a personal message, and this is my favorite message from a prospective renter so far. This is a really good sign for RelayRides - when your customers perceive incumbents as having terrible products, there’s fertile ground for disruption.
I’m also up to an average of 7-10 requests for the car every week, despite having raised the price from $39/day to $49/day. I think this is due to increased awareness of RelayRides, and the fact that I now have a solid 5-star rating. It’s easier to justify a higher price when you have strong reviews - and the only reason that it’s not rented out most of the time is because I love driving the car myself.
Matt Rogers, co-Founder & VP Engineering, Nest Labs
I love this recent quote from Matt at Wharton San Francisco. A huge part of modern consumer design is creating products that lend themselves to great storytelling. The most successful hardware companies recognize this, and actually design the shape, color, feel, and interaction in a way that enables engaging narratives to be built by end-users.
This is What a $679 Drone Can Do
What did it take to create this video? Just four things: a $679 out-of-the-box Phantom drone purchased from Amazon, a GoPro Hero2 camera, an iPhone, and an iMac running iMovie.
As you can see, it took some practice to learn to fly the Phantom, but that’s only because the bundled controller includes 4 degrees of freedom: throttle, pitch, roll, and yaw. That’s a lot of complexity for a casual user. But anyone who can assemble IKEA furniture can insert batteries and a GoPro into one of these drones, and be flying in minutes after opening their box from Amazon.
User-friendly software will make these babies a LOT easier to fly. Drones like these already rely on cutting-edge software and silicon - the airframe is inherently unstable and requires flight controls that correct at rates of over 300 times per second.
Before long, this class of drone will be available to the masses for less than a few hundred dollars. I think the implications are hard to imagine but far more intriguing than Google Glass.
This Picture Sums Up What User Experience is All About
I’ll admit it - I see this handle several times a week, and I pull long before I read the sign that says “push”. And then - even 24 years after reading The Psychology of Everyday Things for the first time - I feel like an idiot. But I shouldn’t.
This is what user experience is all about. The shape, the texture, the use of colors, the language - every element of a product - communicates information to users about function. Your product should make users feel great, not stupid.
So why wouldn’t the store manager reverse the hinges on these doors? Imagine waking up at 6am, rolling out your door 20 minutes later, only slightly awake. And then you pull on a handle clearly intended for pulling, and the door doesn’t open. AND YOU FEEL STUPID. Even if you’ve been into that Starbucks hundreds of times, you pull on the handle first, and then you look at the sign that says PUSH.
Does the store manager go through that door every morning? Probably not.
What can you learn from this?
First, don’t frustrate your users. Make sure that the user flow is consistent.
Second, “change the direction of the hinges”. If your user flow requires a “push” sign, it’s probably wrong. Invest $50 and reverse the direction of the door so that it opens the right way. Don’t worry about bureaucracy and overhead - delight your users. Make it painless and emotionally consistent.
Third, if you’re the manager (i.e. the entrepreneur), enter the store the same way your customers do. If you do that, and enter the door having empathy for your end-users, you’ll avoid making the same mistake. Don’t act like a big company.
Crimping Wires into a Molex Connector
Trying to put the pieces together for an in-car interview series hasn’t been easy. Capturing audio at over 100 MPH while the windows are down requires special microphones, and the harnesses for connecting them to a recording device don’t exist. My earlier attempts yielded great video but the audio capture didn’t work well.
I started out by having directional microphones and speakers installed in the helmets you see above. It turns out that the input/output standard for racing helmets isn’t that common - the installer used an IMSA plug. In turn, the IMSA plugs were connected to mini-DIN 5-pin jacks on the 4-way in-car intercom system you see in the lower right of the photo above.
So why did I need to get out the equipment you see above? Because the radio was only intended to allow the driver and passengers to talk to each other - not for recording. And the system definitely wasn’t designed for consumer usage - there was no power supply, just pigtails out of the back of the intercom radio for a “9-24V DC power source”. How about “audio out”? Just a schematic diagram indicating which pins of a 9-pin Molex connector (attached to another pigtail out of the intercom) were intended for audio left, right, and ground.
I’ve never self-wired connectors and built a simple wiring harness before - so I started out with some online tutorials and a trip to Fry’s in Palo Alto - where I asked a lot of questions. I ended up buying crimping tools, shrink insulator tubing for splices, and a variety of different cables for splicing into corresponding Molex connectors. The system now allows for communication at high speeds without wind noise, and the audio output is a simple 3.5mm male miniplug jack that can be inserted into a GoPro Hero2 videocamera for audio capture.
After a long afternoon of trial-and-error, I’m pretty excited about the results. I’ve wired up three guest helmets (sized Medium, Large, and Extra Large), plus my own, and the system’s ready to go.
Another RelayRides Update
Last Saturday we had beautiful spring weather in San Francisco, and I was disappointed that I couldn’t drive my Z3 convertible - until I got this check in the mail that afternoon from Relay Rides.
$243! The car is definitely paying for itself.
The Online and Offline Worlds Are Merging Faster Than You Think
Will these glasses look good on me? Does this outfit make me look fat? Would this sofa look right in my living room? Every single day millions and millions of online shoppers around the world ask themselves these types of questions. Today consumers need to wait at least a few days, post-purchase, to answer those questions. That angst leads to lower conversion numbers for online retailers.
But as the video above shows, I can now “try on” different types of sunglasses in a virtual environment. Using an ordinary iPad, a Glasses.com representative at TED took 15 quick pictures of my head at different angles. Using computation in the cloud, these pictures were rapidly compiled to create a photo-realistic 3-D representation of my head - accurate enough to watch individual gray hairs rotate past on the iPad’s retina display.
Other companies are using photographic sensors to scan the real world. Matterport has built indoor scanning capabilities that are accurate to fractions of an inch. The level of accuracy is stunning, and unprecedented - check out these examples. And the relentless march of Moore’s Law means that before long, these scans will even be able to map the dust particles in the air at that moment in time.
This is terrible news for brick-and-mortar retailers. Those retailers used to be able to take solace in the idea that they could at least serve as “showrooms” for merchandise, where customers could come in and try out goods - and then buy impulsively. But the reality is that for apparel, people generally don’t enjoy changing rooms, or putting on clothes that other people have also tried on. And if the retailer doesn’t have your size, you’re unlikely to buy. With the virtual reality options improving at a high rate, the online “try it on” options are becoming superior alternatives to the offline retailer options.
Do you really want to go to Sunglass Hut to try on sunglasses that hundreds of other people (some likely sick) have tried on? Or do you want to be able to quickly find the glasses that look best on you?
Do you really want to go to Home Depot, grab a color wheel with 100’s of different paint colors, and try to figure out what your living room will look like with different shades of paint at different times of day? Or guess what a new sofa will look like in that room? Or try to figure out which fabric to purchase?
Yes, these are all first-world problems for consumers. But they’re big opportunities for online retailers that figure out how to leverage them in new ways, and the beginning of the end for physical retailers that have avoided much disruption to date.
I haven’t been to Burning Man yet, but this documentary trailer really makes me want to go. A longtime TED friend of mine, Steve Brown, has been working on this documentary for well over a year. He sent the trailer to me earlier tonight, and it struck a nerve deep in my psyche.
My oldest son, a junior in high school, is starting to consider where he wants to go to college, and what he wants to study - so I’ve been thinking a lot about what advice I should share with him. I’ve come to believe over the last few years that the best skills to learn in our global economy will be in engineering and design.
Watch this trailer, and you’ll see some extreme examples of both. My favorite line in the trailer for Spark is “…I walked away from Burning Man, going, I need to learn how to weld.” I still cannot believe what is built, and then destroyed, and then removed without a trace, during a single week in the Black Rock Desert.
These disciplines - design (not just technical design, but artistic composition and UI/UX construction) and engineering, won’t fall prey to the march of automation and robotics anytime soon. The level of sophistication evident in the displays and buildings at Burning Man is truly spectacular. I’m thrilled to see how Steve has brought this to life and I can’t wait to see his film.
I’m thrilled to announce today that a friend and former colleague, Brent Tworetzky, is returning to the firm as an Entrepreneur-in-Residence.
Brent joins Shasta from Chegg, a textbook rental service, where he served as General Manager of the textbooks and eTextbooks divisions and was responsible for running and growing Chegg’s overall multi-million dollar textbook business. Brent built Chegg’s deeply technical and user-centric eTextbook service from initial team, to product, to market, and also led Chegg’s core textbooks business, improving both customer satisfaction and business success. Earlier this year, Business Insider named Brent one of Silicon Valley’s 13 Secret Rockstars.
In his new role at Shasta, Brent will explore new ideas around a disruptive new consumer web service in commerce, education, healthcare or financial services. He will also act as a mentor and sounding board for Shasta entrepreneurs who are creating companies that deliver exceptional customer experiences.
Previously, Brent held business development, product and strategy roles at WebMD and Mint.com. Brent was an associate at Shasta in 2007.
At Shasta we believe in building long-term relationships with our entrepreneurs. The fact that Brent has returned to work with us is testament to our ‘founders first’ philosophy. We’re thrilled to have the opportunity to work side-by-side with Brent again.
The Future of Crowdfunding
Several weeks ago my oldest son showed me this video - of him in a home-brewed flight simulator. It turns out that several of his friends from San Francisco decided last year to build a 3-axis flight simulator using funds raised from Kickstarter. Using a salvaged Piper Cub fuselage, his friends created a Viper trainer, inspired by Battlestar Galactica.
They really made this thing work. Hard to believe that high school students could (1) build from scratch and (2) raise over $10,000 to build a fully functioning flight simulator. Moore’s Law and social media are letting our kids build things for fun that weren’t even possible 30 years ago.
Sexy fundraisings by Pebble and Ouya have grabbed the headlines, but the real story is in examples like the Viper. Dodge has even jumped into the marketing fray with the Dodge Dart Registry, where you can use social media to recruit your family and friends to buy you a new car, piece-by-piece.
The Other Big Show on TV this Weekend
I can’t believe I just spent the better part of the last two days watching 13 episodes of House of Cards on Netflix. Everyone’s talking about the Super Bowl today, but I think this is the real media industry news of the week.
Why? Great original content still costs a lot to make, and it matters for building an audience. I like to think of this as the media equivalent of great product.
In this instance, the product has been optimized for binge viewing. HBO and ABC have known for years that when people discover new shows they missed the first time around (like The Sopranos, Lost, or Game of Thrones), they devour entire seasons in single sittings. But it’s taken a while for writers to realize this change in consumer behavior.
For the first time, a big-budget series has been designed from the ground up for binge viewing. The plot, the storyline, the dialogue, the story arc, the characters - everything - has been optimized for non-stop viewing. It’s really a 10-hour movie with regular stopping points for sleep or work. You could never compress a compelling storyline like this into a single movie.
Then, Netflix released the whole product on Friday. All thirteen episodes. Not over 13 weeks, but in one shot. This has never happened before with a $100 million series. And from following friends of mine on Twitter and Facebook, it looks like I’m not the only one who binged on House of Cards this weekend.
The Golden Master and The Long Shadow
What separates today’s hardware development and production from software? About 25 years. Anyone who developed software for PCs remembers the Golden Master, a production step that was originally pioneered by the music world.
Long before the Internet was widely available, physical devices were required to distribute software to end-users. To achieve economies of scale and low cost, a single version of software was copied or pressed over and over into thousands and thousands of floppy disks or CD-ROMs.
In today’s world of Internet-based software distibution, it’s easy to forget a world in which companies strove to ship completely bug-free products. Why? Because 25 years ago - with shrink-wrapped physical distribution and no Internet-connectivity - field software updates were a pipe dream.
That’s the world of hardware design and manufacturing today. Using 3-D printers, it’s possible to iterate and rapidly improve the product - up until production. Then, it needs to be perfect. Yes, PERFECT.
So what does that mean for an entrepreneur building a hardware startup?
Hardware entrepreneurs must recognize and accept the Long Shadow. Today’s hardware is Internet-connected and has a huge software component. Yes, that software can be readily upgraded in the field - BUT - the hardware can’t. You have to strive for perfection in the hardware. Utter perfection. Get the hardware wrong, send it to production, and you’re screwed. When you send the final version of your hardware to a contract manufacturer, it’s too late to make any changes without incurring huge costs.
What is the Long Shadow? This is a term I first heard from Ben Einstein, co-founder of Bolt, a hardware startup incubator based in Boston. The Long Shadow represents what you have to live with if you make mistakes in hardware development:
- Build hardware that’s overpowered with a high bill of materials? Suffer from low margins and a price point that slows consumer adoption.
- Build underpowered hardware? Suffer the consequences of a terrible end-user experience at the software/UI level - whether through slow speeds, short battery life, or poor wireless connectivity.
- Build hardware that fails prematurely? Suffer the consequences of high return rates and crappy end-user reviews.
Any of these are likely fatal for a startup.
The lesson for hardware entrepreneurs? Get the hardware Golden Master right, NO MATTER WHAT. Build perfect hardware and avoid the Long Shadow. Today’s conventional wisdom of “fail fast” with consumers simply doesn’t translate to hardware - only to the software which rides on that hardware.
Learning From Others’ Mistakes - Or, Why You Should Visit the MakerBot Store in Manhattan
MakerBot is an exciting company, but it’s a bit premature to be building a monument to their own success. I expected to walk into a store ready to inspire me about the potential of 3D printing, and instead, I walked out disappointed.
Let me explain.
Every product comes with implicit promises. Promises both rational (ROI) and irrational (emotional impulses). To deliver a great retail experience, a store environment needs to engage customers - not turn them away. Instead of creating an environment that educates and engages customers, the MakerBot store felt like a museum store. A museum store complete with wall signage portraying items from MakerBot printers as art, with $20-40 price tags to match. But not just a museum store, but a store that promised a perfect product that is currently far from perfect.
I’ve used the MakerBot (including the Replicator 2) on five different occasions. Startups (for good reason) love playing with it, and several use it for internal prototyping. In fact, I was inspired to visit the store about a week ago in Manhattan because I had just used a MakerBot printer at a startup based in Boston the day before.
The problem is, the product doesn’t work as advertised in the store. Given the state of today’s art, the MakerBot Replicator 2 represents an impressive accomplishment - but the items that come out of the printer are a far cry from the polished items you see for sale in the store. Anyone who buys a printer and expects the results you see in the store - without the series of post-production steps that are required to get to the resulting items you see in the store - is going to be sorely disappointed.
I walked into the store ready to buy. As I looked at one of the boxed, ready-to-sell Replicator 2 printers, a salesman walked up to me. Awesome! He was friendly and engaging. Even more awesome! I asked if I could have it shipped to me. He said yes! And then he said something that you would never, ever hear in an Apple store … “Did you see the new printer we just announced at CES?” I said that no, I hadn’t. He said that I might want to wait for it - it’s awesome! How long until I can get it? Two or three months was the answer. What’s great about it? It can print from two spools, in multiple colors at once.
But what came next from the salesman shocked me. “But the new printer doesn’t really work that well … you need to be an advanced user to make it work.” Wow, I thought to myself. Do I have what it takes to be a $2,000 MakerBot owner?
Then it hit me. The whole message of the store was: “See how great we are!” When the message should be “…you can and should join us in the MakerBot revolution.”
I don’t think the MakerBot founders realize they’re sending this message. I’ve met them in the past. They’re great guys. And the product is truly groundbreaking. The problem here is that the retail environment sends the wrong messages. Yes, it’s a good idea to give people a chance to experience the product. But when you go to the effort of building a store, make sure that it delivers on your objectives. Actually make it easier to experience the product, rather than look at items under glass. Don’t throw subliminal challenges at your customers - engage them! Embrace them! And give them every reason to buy what’s on your shelf, not walk out empty-handed and confused.
What To Look For at CES this Year
For the first time in years, we’re going to have an interesting CES. For too many years it’s been larger flatscreen panels and Microsoft (yawn), but that’s about to change.
Here are the big trends to watch for this year:
- Truly exciting consumer hardware startups. There’s real technology development going on here - check out Tactus, Basis, Formlabs, and Valencell. And that’s not including the under-the-radar startups with stealth products being demo’ed in private suites rather than the show floor.
- Self-driving cars from Toyota and Audi. Having a car that can drive you home from a bar will be the ultimate in consumer electronics. Everyone will want one.
- Crowdfunding. Sites like Kickstarter are the single biggest disruptive wave to influence this industry in years. Raise money directly from consumers and gauge demand without expensive launch programs - Pebble raised over $10 million directly from consumers and will be on the show floor.
- Goodbye Microsoft - none of the CES 2013 keynote speakers are from Microsoft and the Surface tablet launch has been an unmitigated disaster only rivaled by the Windows phone launch a year ago
- Ultra-high resolution screens. The CE giants are finally about to blow way past 1080p HD screens. It’s not about screen size anymore - it’s about resolution and pixel count. Apple led the way with the Retina Display, now watch Samsung, Sony, Toshiba and others bring 4K and much, much higher resolution screens to market. No one cared about 3D, but everyone will love 4K+.
- There will be a lot of press buzz about smart TV and home automation, but none of it will matter for the next few years, until the other shoe drops from Apple and others.
I can’t wait to get there. This will be the first innovative CES in a long time.