The 2017 tech year-in-review

The year is about to come to an end and I wanted to jot down a few thoughts about some of the events that I have found most significant in the tech and startup spaces over the last 12 months.

(1) Amazon goes brick and mortar

 If there is one major corporate transaction that I would highlight that would be Amazon's $14bn purchase of Whole Foods. We are all well aware of Amazon's clout and how much many of us rely on it for buying and selling stuff. This acquisition is a game changer and, even more importantly, it seems like it is not going to be the last of its kind, as in recent weeks there have been multiple rumors, in particular around French leader Carrefour, about Amazon acquiring in Europe.


As NYU Stern's professor Scott Galloway usually says, Amazon is slashing value out of traditional retailers and is likely to become the first $1tn company in the world.  Interestingly, he also points out how Amazon is a threat for competition and advocates for antitrust action that could easily to breaking the company up in different pieces.

Even in such a scenario, Amazon is a global "darling". Case in point: the beauty pageant / auction launched by Amazon among American cities for the purpose of erecting its second American HQ. An astonishing 238 proposals have been received. Game on.

(2) The crypto hype
As blockchain technology evolves, 2017 will be remembered as the year when cryptocurrencies became a new hot thing in tech. I would not dare say the became mainstream but it is obvious that when your mother asks you what bitcoin is and how she can invest in it, there is something going on. I already blogged about this some months ago.

The main cryptocurrencies (in particular bitcoin and ethereum) have had dramatic price increases (chart below; source: Coinbase), which has led to lots of market debate as to whether we are in a new bubble or if, on the other hand, bitcoin is for instance the new refuge replacing gold. There are arguments and interest of all kinds. From Jamie Dimon's - JPMorgan Chase's CEO - calling people "stupid" for buying bitcoin to the CME Group's launch of bitcoin futures a few weeks ago.

But this crypto frenzy has gone past bitcoin and ethereum. ICO is the acronym of the year and funds raised through this mechanism have exceeded $3bn. We have seen a proliferation of new ethereum-based tokens relying, in many cases, in dubious business models.

I took the time this year to learn a bit about all these topics and decided to invest (ie. gamble) some money in various cryptocurrencies to give this thing a shot. It did not go badly, although I am kind of expecting a short term correction and have therefore cashed in for the most part. In any case, in spite of diverse theories, I'd argue nobody has a real clue about how to value these new assets and how things are going to go down the road.

(3) The Uber crash

Uber has been for years the darling among startups and venture capital investors. Aggressive growth all over the world, increasing valuation round after round, huge losses relying on future market domination...and all of this relying on a "bro-kind-of culture" of work hard play hard.

In 2017 the foundations of Uber became under substantial scrutiny as a result of a very unfortunate  sexual harassment scandal which, rather than an isolated event, proved to be part of the company's culture itself. The whole thing led to CEO Travis Kalanick's resignation and to significant user backlash...and planted the seed for the #MeToo movement - which Time magazine has fairly acknowledged as "person of the year" - that exploded with the whole Harvey Weinstein "plot" .

I am very curious to see how Uber recovers under new CEO Dara Khosrowshahi after having moved into such a slippery slope. Corporate culture matters and now that culture-related scandals are reportedly bringing valuation down, executives will most likely pay more attention to it.

(4) Disney threatens Netflix

Star Wars: Episode VIII premiered in L.A. on December 9 and just a few days later in Europe. But this was not the only surprise that The Walt Disney Company had for us before the year end. On December 14 it was announced that Disney would be acquiring 21st Century Fox film and tv studios for $66bn (including debt) which, among others includes the FX and National Geographic networks, a large additional stake in Hulu and valuable franchises such as Alien and Avatar, or TV shows such as "How I met your mother". A massive move that I expect will change the playing field very significantly in the coming years.

I have thought for a long time that entertainment consumption has changed forever and that TV as we have known it is doomed. Disney has understood this and in the last year they have amassed a ton of content on top of their traditional stuff, including Marvel, the Star Wars franchise. Now it is this bold move.

In the last months there have been rumors about Netflix being a target for Disney. However, this may no longer be the case. After deciding to pull content from Netflix, all points in the direction of launching its own service, either from scratch or on the back of Hulu. If you add sports content (i.e. ESPN) to the mix, we do have a new streaming battle ahead. Watch out Netflix, Amazon.

(5) The advent of fake news

2017 has been the year when fake news have become a major threat globally. It all started at the time of the US presidential election in late 2016. As it has been proven, Russia played a a central part in creating fake news that substantially contributed to changing public perception and generating opinion in favor or Trump. Upon becoming president, Trump started a PR war accusing CNN and others of being fake news. Several examples of this unacceptable activity followed for instance with the French election and, more recently, with the pathetic allegations against Spain's democracy fabricated by the Catalonian pro-independence block (and the likes of Russia and Venezuela) supporters) in their crazy and illegal pursue of independence.

Fake news are a 21st century weapon aimed at bringing down the foundations of democracy as we know it. And it is in this instance that technology companies - in particular Facebook and Google given their size and business models - have a huge responsibility to prevent, or at the very least minimize, fake news from happening. They have the budget, the resources and, increasingly, the technology (e.g AI) to address this. I am hoping that they honor their duty.

It's been an interesting year. I am sure 2018 is going to be a ride, which I am going to have to follow even closer. More to come soon.

Happy holidays!

Two weeks in Berlin: my first (biz tech) impressions

It's been two weeks since, with the dawn of 2017, I moved to Berlin. Not long enough to settle anywhere, even less so when you are joining a new company in a city you are not familiar with, where you do not speak the language and know nobody (plus the weather - two cloudy and snowy weeks - and short days do not help either).  But I am taking baby steps each day, slowly but confidently, supported by a couple of acquaintances - how important it is to have friends who can "refer" you anywhere - and a warm welcome at work.

By looking at these past 15 days I can already point out a few local behaviours that have surprised me in areas where technology has been (and is expected to continue) playing a significant part. 


1. Cash is king
After having lived in New York for a long time I got used to paying 90% of anything with debit/credit card (I feel like Spain, or at least Madrid, has also evolved a lot in terms of accepting this payment means in the last years), as I find it convenient and it works great to track my expenses via apps, etc. 

That is not going to work in Berlin, I am afraid. Big bummer. Multiple places - not talking just about the doner kebab shop around the corner - do not accept cards and paying in cash is the only alternative. The same limitation goes for the Stripes of the world. Plus it kind of strikes me that, in particular in a city that has positioned itself as a top European tech hub, payment technology - one of finch darlings - is so detached from the day-to-day.

2. No Sunday shopping 
I typically do not have time Mon to Fri to buy stuff, other than groceries. When it comes to clothing, furniture, personal care, etc, it is Saturday and Sunday for me. 
Realizing that shops close on Sundays in a major and touristy city like Berlin has been a surprise. 

At a time where people are increasingly buying stuff online, this just gives people another reason to continue to do so - for instance, German online retailer Zalando keeps increasing sales vigorously quarter after quarter. I do not see that trend stopping around here (competition isses with Amazon and others left aside). At the end of the day you can buy online any day at any time.

3. No food delivery wars?
In the last few years a lot of money has been poured into food delivery companies such as Deliveroo, Just Eat, etc., just as other players such as Uber launched businesses (UberEats) to get a piece of the action. 

In two weeks I have just seen riders - and not a lot I must say - who work for one company: Delivery Hero's Foodora. I do not know the reason but I must admit I was expecting more activity and more players in the battle field. 

4. Berliners do not like their banks...either
Obviously I needed to open a bank account for my daily operations in Germany. I asked people around and there was no consensus whatsoever about what bank to pick. The consensus was actually on how disappointed most people were with their respective banks.

So, I have decided to give a shot at N26 (formerly Number26), the new German challenger bank backed by Peter Thiel and other VCs. I will be able to provide more info in a few months but I must say that the whole process of opening an account and of getting my cards and activating them was easy, seamless... and all online!

5. Car-sharing is hot
Before arriving in Berlin I had heard stories about how much Berliners use their own bikes - I have not seen a Citibike-like service such as the one in New York - to commute to and from work. Totally true, even if it is -8C outside and snowing. But public transportation - a great network of S-Bahn, U-Bahn, trams and buses is in place - is also very much used. Another thing that has somewhat suprised me is that traffic flows rather nicely when compared - based on my limited perception to date - to New York or Madrid. 

But one thing that is really hot in here is car-sharing. In addition to Mercedes Benz-owned Car-2-Go (which I already used in Spain - the same app works nicely, which is great), BMW has also its own car-sharing service called DriveNow.

There is a lot is to be learned when you relocate to a new country and keeping an eye on how things work is enriching. The European Union may be one single market, but at the end of the day, the differences among country members and their citizens are still very relevant. And I do not see that changing in the short and medium term, it is in each country's DNA.

My summer vacation and the sharing economy

Speaking about the sharing economy is nothing new. However, when you think about it, it has not been around for such a long time even though we may feel that it is indeed the case. But the truth is that the first companies of this kind were born less than a decade ago - do you remember (some are still around) Ecomodo (2007), Crowd Rent or Share Some Sugar (2008)? Neither do I...

In short, technology has disrupted several industries by making them more efficient, in a way not seen before. This video explains in three minutes the fundamentals behind the rise of the sharing economy, being efficiency the key word at stake.  

But in addition to increased efficiency, the sharing economy as untapped multiple regulatory issues. At the end of the day, the regulator runs always behind the market - you cannot regulate something that has never existed before - and the incumbents in the market are not happy when the, in many cases, quasi-monopolies they enjoy are threatened. The legal issues that, even today, global sharing economy leaders such as Uber (drivers employee status, antitrust issues vis-a-vis taxi drivers) and Airbnb (apartment owners crackdown) are facing in key markets such as the U.S. and Europe have been notorious.

In my view, certain trends cannot be stopped, even more so when users love the service. Incumbents, adapt or get ready to die.

Spain has been, and still is today, a particularly tough market for sharing economy companies. However, little by little the latter are finding ways to overcome legal hurdles and to adapt their business models and operate. And for those of us willing to use them they are increasingly becoming irreplaceable.

A good example of how relevant they have become to me has been my latest summer vacation: Car2Go, Uber, Airbnb, Blablacar. I have used them all and they all have had a common denominator: cost savings + convenience + addressing a need. In other words EFFICIENCY:

(1) UBER: I used it to kick off my vacation in style, by getting from work to the train station. I had to make a stop on the way to pick up some stuff and, even with such a stop, I saved 30% over a regular cab (I hate it when cabs charge you an extra just because you are getting to/from a train station).

After multiple regulatory issues and fights with traditional cab drivers, UberX is finally running in Madrid. The service differs slightly from that in the U.S., as drivers need a specific license to operate (therefore, not anyone can be an Uber driver). Brand new cars in great condition, friendly drivers, increasing supply of cars and competitive pricing. Bye bye taxi!

(2) BLABLACAR: for the second phase of my summer vacation I needed to get from a town in the province of Almeria to another town in the province of Cadiz, both in Southern Spain. In the absence of my own car, I had two alternatives - bus and train - each involving a 5h+ trip and approximately €20. I took a Blablacar for €10 and within less than 2 hours I was at my destination. Plus I shared the ride with three very friendly people.

I have recently become a Blablacar user. It essentially saves me time and money on frequent routes (I still sometimes feel like traveling on my own using "traditional" means, though), and I have now realized that it may be a life saver on less common ones.

(3) AIRBNB: finding a nice and affordable place to stay at a popular spot on the second week of August - peak season in Spain - a week in advance may be impossible. You either sacrifice quality or price. Airbnb did it for me: I found a room at a great house next to a golf course and 10 minutes away from the beach at a very low price.

I have been using Airbnb for many years, mainly for leisure trips and renting the whole place for myself. However, over the last six months I have gone a step farther, using it for work travel and renting private rooms within a larger house. So far so good.

(4) CAR2GO: I used it upon my return in Madrid to get home, instead of taking a cab (or Uber). There were cars available nearby at the time and I was not in a rush to get anywhere. A very cheap and enjoyable drive in an empty Madrid to get ready to get back to work.

The new electric car-sharing platform that has been around in Madrid since last November has become a must for me. It is one third cheaper than a cab, it is convenient as you can park anywhere for free, plus you are "in control" as you drive yourself. A perfect subway match to move around the city and to prevent you from the temptation of buying your own car.

Well, it seems like these four guys are gonna stick around for quite some time. I am sure others will be joining soon too.