Thinking a lot about blue and red oceans these days, which was a topic of a New Venture seminar last week (summary post about that coming up). Still not having completed Blue Ocean Strategy, the book (someone told me, reading the summary would suffice. See slides below), I’m still not entirely sure how to get to a blue ocean. More after the slides.

[slideshare id=61974&doc=blue-ocean-strategy-summary4461&w=425]

I know, from the first few chapters, that you analyse features of a competing business. You list them in some kind of chart and map out how far they go and how to beat them with your own features. Taking the case of gaming consoles, which is as good as any, for the two powerful ones, Playstation 3 and Xbox 360, we would list:

• Online platform (more Xbox360)
• Huge graphical capabilities (more Playstation, but negligible difference)
• Looks better on HDTV
• DVD-drive (huge, unpredictable format-war at launch)
• Games, Games, Games
• Same (more or less) controllers as usual
• Expensive components overall
• Price point in the $500+ (at that time)
• Aggressive marketing strategy, based on above features, targeted mostly at young men.
• Huge multinational corporations with huge budgets
• Lot’s of industry consolidation, virtual and actual
• Added, due to comment: both players may have other motives, apart from pushing their gaming-plaform (e.g. Blu-ray for Sony & Live-platform for Microsoft)

And I could probably go on.

Fighting Microsoft and Sony would require some serious leaps in logic, you would think. You can see that the leap that Sony and Microsoft made was not too far off. It was based on the assumption that any next generation of console would have to be significantly more powerful than the last. And you could see that, them being huge multinational corporations, the thinking was probably that if any drastic industry change could happen (take that format war), they could make it come true. There’s another industry-change that had to happen for both of these to take off like gangbusters, which was that everyone would buy an HDTV. That didn’t exactly happen.

So, essentially, we had several weaknesses, namely that:

• The format war was undecided, confusing customers.
• HDTVs were expensive.
• The consoles themselves were expensive.
• They were eating up each others already small markets (made small by the three preceding factors).

You could also add that they focussed on the same consumer segments as a weakness, but how could they know, right?

Now, if you read into Blue Ocean Strategy, then you would expect for Nintendo to have anticipated these issues. How would that be possible?

For one, they are industry-insiders, just like Sony and Microsoft, so they would have had access to data about production costs of both competing consoles, as well as of the state of HDTVs and HD DVDs, now and in the near future. Two, being a successful console and game producer, they would also have a good grasp on their audience. Three, they would have their own vision and be able to iterate quickly on it.

When you think about it, the leap of logic wasn’t actually happening from those entering the blue ocean, it was from those operating in the red one: Sony and Microsoft.

I wrote this, because sometimes, as a new player on the market, you aim small. You don’t want to upset the big players in the red ocean and instead want to *grow* a blue one. I don’t think blue oceans are grown, they are instead hidden. Growing an ocean is the worst leap of all, because it means changing people’s behaviour. Core-users of Xbox & Playstation haven’t changed one bit, rather you found new customers that weren’t being addressed by those two marketing strategies.

If you do have to make a leap in logic to launch a product, make sure that the price you pay isn’t to expensive.

End of thought.

Vincent

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The matter of Rhine Capitalism vs. Anglo Saxon Capitalism, referring to the battle between the capitalist system that has long reigned in the US vs. the more socialist system that came forth from European countries, is one that is on the table right now. The question is this: should we let the market be free, assuming that all information is perfect and hence that all decisions are rational? Or should there be a big brother figure, keeping an eye on market movements and stepping in when necessary?

More banally, should we be paying 50% of our income to regulators in the form of taxes, as it is common in my country, the Netherlands, and several more, or should we minimise that spending to a much lower figure, again betting that everything will sort itself out without expensive regulation? I think that anyone who’s ever had to fork out 30% or more of their hard-earned cash, wished that there was no government at one time or other.

The fallacy of “freedom”
Getting back to free markets and the perfect distribution of information required to make rational decisions. I think it is clear that the latter is not the case. For information to be available to all, there should be no barriers to entry, everyone should be sufficiently sound of mind to process information and everyone should have access to it, either because it is “free” (paid for by taxes), or because they are wealthy enough to afford commercially collected information.

In other words, we are talking about at least middle-class income levels on a massive scale here, which correlates with education and job-prospects. We are also talking about basic education for everyone, the ability to make decisions based on accumulated intelligence. This is not the case in the US, nor any other country that endorses the “free market w/o government intervention” philosophy.

The Credit Crunch and aftermath
More complex is the matter of the credit crunch, which hasn’t been happening on a level that you and me typically frequent; it has been going on between businesses, banks, and ultimately those taking out mortgages and those being shareholders of one of the companies involved. What happened here is 100% a free market problem on a global scale; the belief that investing in housing is a safe bet and the laissez-faire attitude of regulators towards the businesses involved. And the aftermath, which is that banks are being quasi-nationalised on a massive scale.

We are seeing the return of Rhine Capitalism, which has been waging a losing war since the Second World War.

Rhine Capitalism automatically comes with higher taxes. It comes with a re-empowerment of the government and the popular belief that, once again, the government is our parent with all the answers. Both the increase in taxes and the added income from the acquired banks also has another effect, that governments will be richer, will be able to, once again, afford to better provide for the general population, something that we have left to commercial parties in the last years, some of which has been good and some of which bad. This will hopefully lead to better education and perhaps even an alternative solution towards the masses of greying populations that we’ve all be told to fear.

Will it be good for business, the strongest voice opposed to Rhine Capitalism? No, certainly not.

Rhine Capitalism isn’t the solution either
Yes, as my words show, I’m a firm believer in education for everyone, in lowering the barriers to entry for those of low income. I believe in empowerment of people and hope that it will lead to better decision-making on all sides. But I think that going back to the government being daddy is devolution, not evolution.

These last decades, we have seen plenty of progress, particularly on a technological scale, but also accompanied by plenty of others, facilitated by technology. We’ve seen massive developments in science, in logistics, in productivity. We’ve seen a greater awareness in people of global issues and the exchange of information, which has exploded. We’re half-way towards a world, where regulation is an automatic consequence of the fact that everything is becoming transparent.

Eventually, we will also see that issues like the credit crunch will no longer arise, because barriers to national data, to local data, to individual data will fall, allowing individuals and businesses managing their money, to make truly rational decisions.

What happened these last 15 months or so (perhaps even longer) is a warning shot, telling us that we’re not there yet. What happened this last week and the coming weeks is a consequence of exponential decisions based on negative emotions (mainly greed, fear, and ignorance). What should happen today and tomorrow is for people to use this as a lesson to shape our future world and build technology and systems that are designed to overcome these problems and replace the need for the current devolution towards an inefficient, but necessary system of regulation.

There is still a place for the government, as long as large portions of the global population are being suppressed. But, hopefully, it will actually do what it’s meant to meant to do, which is taking care of the people, instead of markets and businesses. But that is certainly something that will have to wait for several more years, until this current mess sorts itself out.

Vincent

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As I’m currently applying for jobs, I naturally often get asked what my dream job is. I hate that question, as there’s no simple answer. My dream “job” is to set up companies, which is really a great number of jobs. Following series of steps is the way I visualise this process, seen from a business, investor’s, and somewhat European perspective, and not so much a technologist’s one. As always, my articles are meant to be the start of a discussion and your feedback is appreciated!

My framework is somewhat inspired by the “Strategic Framework” on the right, which I got from an excellent, but fat book, called “Valuation – Maximizing Corporate Value.” Along with explaining valuation very well, including what all the financial inputs mean and where (!) they can be found, it’s really meant to be a tool for building sound business-strategies. A good book for consultants, if you’re interested in a simple book on finance, and a concrete book on strategy (hard to find in that combo)!

Let’s do it!

Step 1 – the idea

This can really be sub-devided into three separate parts: the vision, the mission, and the plan. The vision is like the cloud in the sky which you spot while taking a walk. You don’t know if and how it will work yet. The mission is a long-lasting platform for you to run your company on; it’s a set of parameters, which come from both your values, your strengths, and your objectives, e.g. “I want my business to be fast, honest, and affordable.,” or Google’s: “…to organize the world’s information and make it universally accessible and useful.”

The plan is not the business-plan per se, but the action plan that is something like this post here. It’s meant to be a set of steps that brings you from the idea to the business, and includes developing your business-idea, writing the business-plan, selecting the team, approaching investors & partners, where to locate, what technologies to use, etc.

Good knowledge to have at this stage: technical about your product, development, the industry; creative techniques; planning techniques.

Step 2 – a short market-research

Just to get an overview of the market and to what extent the problem you’re trying to solve is already being solved. I think step 1 needs to be quite far-developed before proceeding to step 2, because being confronted with a market filled with giants isn’t exactly a great motivator to develop your yet vapourous idea. The same applies to talking to other people (step 4), as those can be quite reality-distorting also.

So a short market-research, using mediums relevant to your industry. Google is always a good start, but sometimes you need to do a patent-search or a scholar-search for high-tech; at other times you need to look at Crunchbase for Web X.0; and sometimes a phone-book or the chamber of commerce databases for local stuff. And sometimes there’s no material out there (a very tricky situation!), in which case you need to look at substitutes for your product/service as well as new entrants from related industries. While that’s already substantial in terms of work, it helps with step 3: the pitch.

Good knowledge to have at this stage: marketing, both in terms of what to focus on, where to search for stuff, and how to write it up so that it makes sense.

Step 3: Pitch v. 1 – convincing your peers

The most important quality an entrepreneur must have is the ability to sell. And there’s a phrase in selling, which goes something like: you can’t sell what you don’t believe in… and vice versa. The more your idea is worked out, the more you know about the market, the more confident you can defend your ideas from the many, many sceptics that are out there.

A pitch v.1 needs to be a mini-business-plan of one to a few pages and include as much information as possible about the product, about how (you think) you will produce it, who you will (need to) hire, where you will be located, what need you are meeting, how you will market your product, how you will make money, how you will defend yourself from the competition. The more specific, the better!

And then that needs to be summarised into a pitch of ca. 2 mins, summarising all the vital data + a touch of personality & charisma!

Good knowledge to have at this stage: apart from the data from steps 1 & 2 (technical, marketing, your industry, your customers), you need some business-planning skills, which includes some (not much) financial techniques; as well as presentation skills & passion.

Step 4: find your team

There’s different philosophies about idea-generation (step 1), with many, I’m sure, arguing that you should be brainstorming with your friends on the idea from the start, that more heads have more/better ideas than one, etc. etc. I completely agree with this. But my philosophy is that without a clear direction, a team can quickly lose focus and follow political objectives, rather than pragmatic ones. While, I’ve been blessed with a few groups of people, where the chemistry was excellent and everyone was intelligent enough to be willing to listen & learn from others, many other groups have been a complete failure, because politics & brains definitely don’t always come hand in hand. So, I’m of the opinion, that an idea needs to be very well-developed & thought out before presenting it, after which it can be refined and adapted, and even rejected, according to the more specialised knowledge of group-members.

About finding team-members; for myself I have to say, after spending a long-long time on my thesis—a solitary activity—it’s not that easy. Again, networking, LinkedIN/Facebook, blogging, university (very important!), family, highschool-friends, former employers/co-workers, etc. , all good choices. Luckily for me, my thesis also brought me into contact with a large number of incubators, which are also good places to run into smart people; I worked for a venture-capital-tracking firm, ditto on the smart people; and there’s Tech IT Easy, Ditto 3x! So, really, never a shortage of smart people, when you look for them!

Good knowledge to have at this stage: material from steps 1-3; people-skills, in terms of choosing the right group of people; leadership & sales-skills; and the ability to form rational arguments & present your ideas well.

Step 5: write a business-plan

Read Jeremy’s post here.

Step 6: pitch v.2 – approaching early-stage investors

Somewhat different from later-stage investors, these are people you talk to, usually before launching your company (except maybe in web-world), and for which you don’t have that much tangible evidence to convince them with yet. So your pitch needs to be somewhat like pitch v.1 (step 3), but will include more data that you collected for your business-plan, but presented concisely and clearly showing how you will meet a need, how you plan to make your investors their money back + some more, how you will reduce the risk for them (very important!), and what you see their role to be in your business, apart from cash-cow—this only applies to active investors, such as business angels, not banks or subsidies, though not all business angels are able to be active (though they should always be able to help with contacts), and some bankers may surprise you.

Good knowledge to have at this stage: all the material from the previous steps, and similar skills as for pitch v.1. You need to speak a language that early-stage (!) investors understand!

Step 7: approaching early-stage investors

Banks & subsidies are easy to find, though sometimes you still need a little help and/or an intro; generally, banks want a lot of securities, sometimes already having a subsidy agreement and working with other, more experienced investors helps a great deal. Subsidies are a b*tch, as they make you do a lot of paper-work and impose some rules, and they generally work best for innovative, sustainable, or export-related ideas.

Business angels are a little harder. Usually, it helps going through trustworthy (& older) people that have built a network themselves. I can’t say more about that, except that entrepreneurs should avoid acting predatory and avoid predatory investors (both happen way too frequently), and you can mostly control the first (yourself), not so much the latter (though it helps going through someone you know).

Good knowledge to have at this stage: know your business-plan inside out; know how to present it and the financial data concisely; people-skills, in terms of evaluating the people you meet and selling yourself; having a network helps; having a good team in place helps a lot; having collateral helps with banks; having a tolerance for bureaucracy helps with subsidies, as does an association with a public research-institute (e.g. an incubator or your university).

Step 8: preparing an action-plan

Technically, this should’ve been part of your business-plan (step 5), but the point is that you now have money, you’ve made certain agreements based on it, and your objective is to use that money wisely to get your business off the ground. So now you need to decide what spending needs to be done, preferably as little as possible, and how to quickly get to the next stage. If you’re in web/software, you should already have a prototype, and focus on developing it, and build an early customer-base. In which case, you need someone to do the developing and someone to do the marketing/selling; usually technical staff outweighs the marketing staff at this stage, the latter often being the role of the entrepreneur himself. If you’re into high-tech, a prototype still needs to be built, which means technical work. This stage is really too specific to generalise; it depends on the type of product, business, and industry. Something in bio- or meditech, for instance, can take a decade to complete.

You also need to decide on whether your basement/garage will be enough, and on what type of legal protection your product needs, as well as the legal structure of your business. Which includes talking to lawyers, like this one.

Good knowledge to have at this stage: an understanding of what the new stakeholders in your business require; the ability to focus on what matters most for your business; a holistic understanding of a wide variety of business-matters, including hiring-practices, location-choice, development, legal & accounting tasks.

Step 9: spend (wisely)

Hire the people that you need, try to find smart ways to get smart people for cheap, either through internships, summer-programmes, or stock-options. And some smart people obviously need to be paid more or less what they are worth.

Locate cheaply while developing. For software, I’d suggest Eastern Europe, close to software-universities, but a basement in Paris/Berlin/London/Amsterdam also works of course, though both the location and the people will come at a premium. Important is to consider that many investors prefer you to be geographically accessible, as do customers.

Find viral ways to market, if you’re at that stage already. Thank you, internet, for existing, but free press also helps. Find smart ways to acquire customers, e.g. involve them in product-development, use them for word of mouth and case studies, partner up with good companies, etc. This is again very product-, company-, and industry-specific.

Build synergies between partnerships & investors; again really a step 7 problem, but it helps when your lawyer or your US/Asia-based marketeers are also investors. I’m also a fan of synergies in the HR-department; giving employees stock-options is not only cheaper, but also serves as a motivator. Of course always be careful who you choose to give part of your company to!

Good knowledge to have at this stage: everything from the steps until now; people-, negotiation- & management-skills, guts to market & sell; the dedication to work as many hours as it takes; etc.

Step 10: pitch v.3 – approaching round 2 (series A round) investors

While building your business, you should also build your business-plan and have a much better idea of the inputs for your valuation and the (projected) revenue-potential. And you should have surrounded yourself with a nice set of advisors and “network-nodes” that get your business-plan to be placed on top of a pile somewhere. You’ll still need a pitch of course, but that shouldn’t be a problem anymore at this stage.

Good knowledge to have at this stage: everything from before, especially how to pitch and what to pitch; and a network helps tremendously.

Step 11: round 2 (series A) investors

Bearing in mind that over 80% of businesses don’t make it this far, in theory, a business goes through a number of stages, before ultimately going public or being acquired. Web-businesses have distorted that process somewhat, as has the Enron-aftermath. But many early-stage investors may wish to be bought out at this point, an exit for them, and you may even want to do the same. VCs like replacing entrepreneurs with experienced CEOs, especially if the entrepreneur is a technical person, who will then likely be “promoted” to something like CTO or CIO. Investors do this because they have to account for the money they invest in you, and hence have to show their “bosses” that they do everything possible to mimimise people-risk.

While there are cultural & VC-specific differences, the risks that you need to have already covered here are usually both technology- and market-risk, translating into a workable product and one that preferably already has customers (lined up).

Good knowledge to have at this stage: either the ability to grow with the business; i.e. become more of a manager, less of an entrepreneur; or the ability to step back.

Step 12: launching the rocket-ship

A good VC will take your business far, and that’s where I’ll end it.

Some further reading

If you haven’t read enough already…

• “Valuation – Maximizing Corporate Value.”
• “Crossing the chasm” – on tech-marketing, -sales, and -strategy.
• Venture Hacks’ Term Sheet Hacks – on investors, mostly
• Ask the Wizard – on lot’s of interesting entrepreneurship problems
• TechITEasy.org – on lots of interesting tech & business-subjects, if you dig deep, i.e. use the search.

This may qualify as the longest post on Tech IT Easy, I don’t know. I think I covered the main topics on a global level and obviously there are plenty of feedback loops and some short-cuts, but please let me know if there’s things I missed!

Vincent

P.S. I’m always interested in building great companies, as well as discussing this topic. So if you’re a smart (tech-)person, looking for a biz dev. guy, or you just want to discuss you idea in confidence, feel free to give me a shout.

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 In chess, a gambetto – say it with an Italian accent, consists in sacrificing a piece at the beginning of a game to gain a competitive position on the exchequer – for example through the control of the center of the chessboard or one of the long diagonals.

Getting back to business (we’ll get back to the gambetto later), it is very common to say that the state of an economy is reflected by the strength of its currency when the Euro currency is weak – and hence that the economy of the EU are in poor shape. However, when the Euro gets stronger, companies and officials claim that corporations are constrained in their efforts to export goods and services and that the situation should be reversed or the EU will soon enter an economic turmoil.

I think this is all too easy and bullshit.

God Dollar used to be the only viable currency in international trade, until the Euro came out of nowhere in January 2000 (2001 for actual pocket coins and bills). The European Union is the world’s largest consumer market, and a gateway to the Middle East and Africa for American companies. Although the Dollar still dominates international transactions of goods (slightly) and financial transactions (easily), the Euro has emerged as a tangible alternative considering the political stability of the region.

Consequently, the Euro vs. US Dollar exchange rate has kept growing insanely from 1 EUR = USD 0.85 in mid 2000 (1 EUR = 1.19 USD on January 1st 2000) to 1 EURO = USD 1.47 USD today. Althoug I acknowledge the trickiness of the situation for export businesses, high tech or not, I see very few corporations have implemented hedging strategies or make proper use of forward contracts – which is a shame. Still, instead of lamenting, I believe economic decision makers of both the US and the EU should roll up their sleeves and act in such a way (hell yeah I’m even givin’ lessons now, love blogging…):

For US High Tech companies: go for internationalization. Acquiring hardware, software, telco devices, consumer electronics and services labeled in USD has never been cheaper. So why wait? I’m pretty sure any potential buyer would understand this reasoning. A weak USD is a fantastic opportunity for American exporters to thrive abroad, and win strategic, long-term projects. It doesn’t matter whether the profitability of these projects is low: what matters is to build reputation on new markets, or to highlight your competitive advantage against local players. Remember, the gambetto? Be ready to sacrifice a few cents today (anyways, the dollar rates so low that it’s no big loss whatsoever) to be in the real race when that moment comes.

For European high tech ventures: shop for intellectual property and talents in the US since the Euro has never been so strong against the US Dollar – which will make acquiring quality companies cheap, and build production capability in China and India (or go and get cheap but excellent developers in Eastern Europe, before the Euro comes there, or Israel) to reduce the cost of goods sold, enhance their competitiveness and therefore be ready for a shift during harsher economic times or win back market share on their competitors’ behalf. EU corporations, especially the big ones, find it hard to tear the P&L from the balance sheet and should learn to make better investments. Remember when the VCs said that few large European high tech corporations had a real, sound external growth strategy? Even though making the quarter may seem tough because of a strong Euro, acquiring today technologies that will generate tomorrow’s revenues boils down to ’sacrificing’ a small slice of the pie to weaken the competition, and build a better product offer for tomorrow. Gambetto again.

Now waiting for the Chinese Yuan to offer a third way…

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Just come back from the third edition Win In China september session. It is entrepreneurship program financed by CCTV2 (channel 2 of China Central Television). The winner gains ten milion rmb (around 1 milion euros) to realize his project in China. All challengers have to speak chinese mandarin to present his idea and at least 18 years old, last year there were around 200 people from overseas enrolled.

I met M. Andy Lee who presented his Web3.0 project. Unfortunelly I did not have enough time to understand his idea, because there was noisy. He just sent me a mail today to explain his idea, and he quotes this article from the magazine The Economist, Inserting advertisements into video games holds much promise.

I am still trying to understand the relation between web3.0 and in-game advertising. Some smart people like Andy are definitively not on the same planet as me . I will continue to give some feedbacks of this meeting.

Who is Andy Lee ? Andy holds EE Ph.D from Stanford, and MBA from UC Berkeley. He used to work in Cisco, AMD, also as CFO in EiC Corp., and CTO in TeleVersal Systems, Inc. Andy is currently the Managing Partner of Berksford, a US/China Investment, M&A, and Strategy company. His project in Win in China is about Web 3.0.

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This another part in the saga of my thoughts on ‘Grinding it out‘, an account of Mcdonalds, written by Ray Kroc. I’m about 3/4 into the 210-page book. Let me start with a disclaimer: ‘Grinding it out’ is a book written to promote the McDonalds way and aimed at motivating existing staff and operators, as well as attracting new blood of course. I feel like I should tell this to any person thinking about reading the book, because I don’t want to write or promote an informercial on McDonalds. Let me also say that I’m a vegetarian since a few years ago and my opinion of McDonalds is somewhat flavoured – I respect the business but I only eat there once a year.

That said, it’s not a bad book at all. In it, you will learn what made McDonalds great and much of what made Ray Kroc great. I wrote a little about him a few days ago – a blue-collar worker, who excelled in sales and at smelling opportunities. He was an operations-freak, planning out every step from the potato to the french frie or from the cow to the burger, and from the food to customers’ mouths. But it all started with location-location-location, planting a restaurant in the right spot, attracting the talent to run it, and promoting the McDonalds way. This book is a perfect example of that.

McDonalds is a complicated business, wrapped up in a simple package. Many people eating at McDonalds think the restaurant is owned by the company and all the staff works for them too. They may even think that McDonalds has farms growing potatoes and herding milkshake-cows, I’m not sure. But it’s not like that. At the time the book was published (the last edition in 1992), the company owned less than 30% of the restaurants around the world, and I’m sure it’s around the 20% mark or less today. The rest is composed of franchises, owned by independent operators, who, like entrepreneurs, have to turn an empty building and a name into a thriving ecosystem.

But the advantage of being a franchisee, especially a McDonalds-one, is that you are not really alone. Sure, you invest a considerable amount of cash into the venture and you bear most of the risk, but when you sign up for a franchise, you get working experience at a running McDonalds-restaurant, training at McDonalds-university, also for your staff, and the purchasing- and marketing-power that makes McDonalds great.

Something about purchasing-power. The last book I read on McDo was in the form of ‘Fast Food Nation‘, a drastically different view of the company. If ‘Grinding it out’ is a picture of heaven, this book presents it as hell. Some of the criticisms in that book were about the way that food was artificially flavoured to make better smelling food (I forgot how that was bad), and on how the power of McDonalds both lead to lower wages in America and the destruction of the farmer. On that last point, I think that’s probably right, then again, whether there is still space for the traditional farmer is another discussion all together. McDonalds has a lot of purchasing power, it has deep and privileged relationship with its suppliers, which result in cheaper and (hopefully) better food. This translates into an easier experience for the franchisee.

From my reading, I think there are following sub-groups in the McDonalds-umbrella, which make up the ecosystem. These are: the corporation, which runs marketing (think Ronald McDonalds), decides on real-estate locations, and maintains some (not all) of the relationships with suppliers. Then there is McDonalds University, which trains operators and staff to maintain a smooth operation and to always keep smiling. There are the suppliers, which are located all over the world. There are the franchisees. And there are the customers. In one package it a near-perfect picture of the American global capitalist system.

Well what do you know, Jeremy is a Microsoft-head, and I’m turning into Mcdonalds-one. One of several keys to franchising, I learned in a course I did with Jeremy, is to make every step so explicit, that you can write a manual about it an other people can follow it. This book is an example of evangelising a business-idea. And it’s great at that. Perhaps more to follow as I read the last pages of the book. All opinions on McDonalds aside, franchising is a great and easy way to get into running your own business, and a great way for your business to grow big.

Vincent is a co-author on Tech IT Easy. You can find out more about him on this blog’s initial announcement or on his blog. He enjoys a (fish-)burger and a milkshake about once a year. Ps. I’ll be leaving for a holiday in a few hours, so any responses to comments will be delayed by a few days.

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Dubai isn’t dumb when it comes to economic policy. Some economists there have noticed software giants (Google, Microsoft, Apple, Oracle, SAP, IBM, BEA, Yahoo!, etc.) acquired companies on a valuation related to the number of software developers such preys accounted. A few years ago, it was commonly agreed that a software giant would be willing to ‘acquire’ each software developer for something like US$ 1m. In other words, a 12 developers-strong software startup would be worth something like US$ 12m. Nowadays, I would say it gets closer to EUR 1m per developer though (EUR 1 = US$ 1.37).

Dubai has noticed the trend and has started to build gated communities for software developers – very near Dubai Internet City. In terms of ROI, a relatively small initial investment (it is no secret that Dubai employs thousands of slaves from rural India, Indonesia and Pakistan to get the construction job done) for roads and houses that are soon to be refunded by individuals and taxes anyways, plus a massive communication effort in hand with both the software and IT service multinationals willing to invest in the area to attract software development talents from South America, Russia and South East Asia, will mechanically generate tremendous per capita GDP and create value for the local economy.

What if software development was a true booster for the World Economy? I wish more politicians got to know about Dubai’s measures to increase GDP. It all boils down to this: attract and train the best software development talents.

PS: many thanks to Raphaël Fétique, from eCommerce consultancy Converteo, for the info

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I’m very glad to welcome Matthias Schwenk on Tech IT Easy. For the record, Matthias already is a prominent blogger in Germany. His personal blog (in German) appears #14 in the consulting section of the German business blogs ranking.

Matthias, who I met through the blogosphere, defines himself as a Web 2.0 evangelist. His vision is that many industrial companies could use Web 2.0 as a framework to enhance collaboration and hence competitiveness – the issue being that few people in Southern Germany know what Web 2.0 is. This is where Matthias comes in to explain to companies how Web 2.0 could be leveraged to compensate with the lack of engineering resources and the competition from Asia.

But let start all over again from the beginning: to make a long story short, Matthias studied business administration (Betriebswirtschaftslehre) not only at the University of Saarbrücken, but also for one year in France. He was at université Lyon II and got a Bachelor in Economics there right before the Berlin wall fell.

Well later on, Matthias worked in the banking-business and finally got self-employed as a consultant. Matthias worked on different new business projects (business planning) and some sales-related projects. This year (2007) he started evangelizing the web 2.0 in southern germany (and started blogging about it too). It is a difficult job: Matthias is an evangelist, but not many folks want to hear the good news! Southern Germany, with Bavaria and Baden-Württemberg (where Matthias lives), is a wealthy area with only litte unemployment and many sucessful companies. There you find the machinery industry nearly in every village: small places with small companies, but these companies sell about 80 % of their production on the world market – and have 80, 150 or 200 empoyees! In some cases the companies are “larger”. Then they count some 500 oder even 1.000 persons.

And now imagine: most of these successful industrial companies have never heard of the web 2.0! And they have difficulties to see what the web 2.0 would be able to do for them. So negotiating is difficult and takes time. Their problems lay in other fields: competing against China and finding enough young engineers – there is an incredible lack of well-skilled engineers and it’s getting worse. So Matthias Schwenk’s job is to make clear that the instruments and possibilities of the web 2.0 are a good help to compete china and to find young engineers.

The idea of having Matthias blogging here is that Tech IT Easy will be his English-speaking communication arm. All bloggers publishing in a language that’s not English and feeling like becoming visible in Shakespeare’s idiom are free to contact me if they like. We are extremely glad to have Matthias on board to share with us his vision and thoughts on the web and we already know this will be a fruitful collaboration.

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Tech IT Easy is dead, long live Tech IT Easy!

Today is our Independence Day: this blog is now fully accessible through www.techiteasy.org. All existing jeremyfain.wordpress.com/something trackbacks are automatically redirected to www.techiteasy.org/something. Our search engine referencing might suffer for a couple weeks, but since I noticed we have quite a captive audience (people coming back every single day are very, very numerous – like 600 / 900), it’s not going to get too bad.

Step by step, you will see my personal references (Flickr feed, CartoReso maybe, Developer Pages, Del.icio.us, blogroll) vanish to leave the Tech IT Easy community do what it has to do with this very blog.

When I find some time (most probably in July or August), the template will evolve and integrate external widgets.

Back to the Tech IT Easy vision:

A community blog where professionals passionate about technology (software, web, consumer electronics, eCommerce, media, hardware, robotics, telecommunications, computer networking – from both market & technology view points) share their thoughts and analyses with the world. The only rule that applies to all contributors is that there should be no rule whatsoever: no control, no hassle, no constraint. Once you’re in the community, you’re there forever unless you decide to leave it. The idea is not to go after TechCrunch, TechMeme, GigaOM, VentureBeat, Read/Write Web and their likes: rather than information, we deliver original content deeply rooted in the background of the authors. To say the least, we should complement existing tech information blogs rather than compete with them. On top of that, we are all amateurs and none of us blogging full-time, this should position us in quite a different way. Last but not least, we enjoy answering valuable comments and emails: one thing we all share is our willingness to stay close to our readers.

PS: just opened my personal blog in French, named Jeremy Fain in French. Accessible right here. I’ll be testing a new open source platform, after Wordpress for Tech IT Easy: DotClear2.

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You tell me!

In a few days, we will celebrate the first anniversary of Tech IT Easy. Although the growth of Tech IT Easy has overall been pretty amazing (+25% / month on average), it’s been slowing down a bit in May and beginning of June.

For next year (24th June 2007 –> 24th June 2008), I would like us (we’re a big and growing team now, a happy crowd) to multiply by 5 and move from 800 – 900 single visitors waters to 4000 – 5000 single visitors territories. Looks ambitious but since we’ve proofed our concept, I believe Tech IT Easy has what it takes to reach that milestone within 12 months.

I’m planning to take different steps to increase traffic:

• Host this blog ourselves to be able to incorporate the widgets we want in our sidebar and slightly change our layout (to make it look less sort of serious);
• Move to a proper techiteasy.org/blablabla address, keep jeremyfain.wordpress.com for myself only; my issue being that I’m not moving an inch until we find a solution not to loose our trackbacks. Any expert in the room?
• Hire more bloggers (goal: 35 tech-passionate bloggers in 18 months; how: no constraint whatsoever, publish whenever you want on the topic you want)
• Hiring direction: topic diversity matters (web experts, software buddies, develops, usability consultants, consultants, VC, entrepreneurs, sales, marketers, acad, etc.) as well as geographical diversity (still weak on Oceania, Asia, Mideast, Africa & Americas analysis coverage – very strong on Europe & South Pole innovation clusters)
• Bring in prominent bloggers publishing in their native language only (eg German, French, Italian, Spanish) or entrepreneurs who don’t have time to run a blog full-time to discuss their business with you contributors
• Organize a physical reunion of co-bloggers to strengthen links within our geeky community
• Evangelize shorter posts, alternating rogue news and in-depth analyses, and push towards embedding more videos?

In your opinion, what action should we take to go the extra mile? I’m not asking for praise, but for criticism: what’s wrong about Tech IT Easy? How would you improve things if you were on board (or if you are a Tech IT Easy blogger already)? Thank you in advance for your feedback. We’ll make sure we implement all relevant advice in reasonable time frames.

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Message from Jeremy: To all Tech IT Easy readers, who could obviously not necessarily remember the initial announcement, I have invited blogger Lucien to write about Web 2.0, China, and many other things that happen to interest him at the moment. Lucien, they’re all yours!

I am among the minority who didn’t notice the recent bull market trends in Chinese stock market. I never really look at what is happening in the market, because I never bought any or sell any in my life. Maybe people outside Chinese also didn’t pay attention to the performance. Here is what happened.

4 Times Increase

The Shanghai Stock Exchange Index was 998.23 in June 2005. Yesterday, it reached 4151.42, which is the highest in the history of the stock market, and almost four times than two years ago, and keep increasing.

Buy stock in China is always like buy lottery

If you bought the right stock, you can get 50% gain in days, and if you are not lucky enough and get the bad stock, it will shrink at the same speed. Unlike NASDAQ, the stock price in China has a threshold. If it raise or drop too much, it will stop trading and hold until the next day.

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5 reasons I like my iPod:

1. It’s small and hence handy (real size here on the picture).
2. Still, buttons are of reasonable size so that it’s not hard at all to switch track whilst running.
3. The autonomy’s pretty excellent (about 12 hours listening to music).
4. It’s water resistant (let’s put it that way).
5. The clip doesn’t get tired easily, and it fastens to your clothes surprisingly well.

However, it’s not perfect at all. Here’s why:

1. Standard Apple headphones aren’t adapted to running (don’t stick to my ears).
2. It’s rather expensive for what it is (1Gb of hard drive only).
3. No screen so you don’t get to know what song you’re playing, but you knew about that when you bought the device so it’s your fault.

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My cellphone is down: I can hear perfectly people who talk to me, but they often (>50%) can’t, and as you can imagine, it can get pretty annoying…

To make a long story short: I badly need your help. I am to make a significant purchase this very week.

I’ve decided to make a big leap and buy a Pocket PC or Smartphone. I don’t know anything about Pocket PCs & smartphones, except that I don’t want an iPhone, a Blackberry, a Nokia, or anything that doesn’t run Windows Mobile (ideally 6). It’s not that I don’t think these are great products, but I already have a Mac (although I now use Vista @ work and I think it’s much better than Mac OS X for a business purpose, but more on that soon), use Firefox (although I started using IE7 and it’s a good browser), hack code in Java (few time to start going through .Net tutorials, but I should start pretty soon), etc.

So I just feel I ought to eat my own dog food for once (+ I hear Windows Mobile’s really a user-friendly and handy environment). Unless you bring to light a unique selling point that triggers a purchasing decision (like Sony Ericsson P990i’s business card archiver) of course – I’m a pragmatic person.

I’m in desperate need for your advice. Which Smartphone / Pocket PC / PDA should I buy (new or second hand)? Many thanks for your help.

Here are the specs of the device I’m looking for: keyboard, wireless, Windows Mobile 6, GPS, Office, Acrobat Lite, direct push emails, 3G, HSDPA, ideally Messenger as well, I don’t care about having a crappy camera, HTML support in email client, Bluetooth 2.0, @ least 400 Mhz. CPU, EDGE, GPRS, mini SD memory, Quad-band, Zip manager.

I’ve already listed relevant devices and I am yet to go through their reviews: HTC P3300 (also named Artemis), E-Ten Glofiish X500, HP iPAQ hw6915, E-Ten Glofiish M700, HTC TyTn, Samsung SGH-i320/SGH-i600, Palm Treo 750. Any suggestion or feedback?

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It’s not the ‘what’ or the ‘which’, it is the ‘how’. Desktop applications haven’t killed server applications: the former has taken the lead over the latter but server apps have in no way disappeared. Both technologies cooperate, collaborate & co-exist.

The same will go for web applications: Software as a Service won’t kill desktop applications, although the desktop apps business is necessarily to suffer from the rise of web apps. Just like server software suffered from the introduction of client software.

People are starting to have the choice to either use client software (desktop applications), or service software (SaaS, web apps), or both. The decision could be compared to purchasing and using a car vs. taking the subway – or both.

Using client software is like purchasing and driving a car: it is a true investment that is either pleasure-driven or efficiency-driven. The sales cycle may result pretty long, but you’re likely to get a discount. Maintainability (upgrades, support, administration) and energy supply (gas = electricity supply to host servers) can be costly , but in the long run, the availability rate should be pretty high (no need for Internet access to use it). The main hassle of using a car is probably the time it takes to find a parking space (hard drive space). A car can be pretty comfortable, customized (parameterized), and is a consistent choice when making a long trip. Furthermore, there’s no pickpocket in a car (better data security: hosted on site) but it is likely that you’re not going to meet many people (not so collaborative after all).

Using service software is like taking the Subway: you pay as you go (ticket) if you don’t travel so often, or you pay a subscription (monthly or yearly metro card); it’s pretty cheap and one may not negotiate prices. It might be quite unsafe sometimes (unless there are many security agents and then you feel like watched). However, it’s pretty handy, certainly more democratic, but available only in certain areas (big cities). Subways sometimes may not be so reliable (strikes), or comfortable (lots of traffic), but with the right state of mind, you’re certain to meet people. Last thing: the subway runs all the time and not only when you’re in the process of using it.

From this parallelism, I would like to draw 2 sorts of conclusions:

1. the generalization of subways in all metropolis hasn’t constrained the democratization of the use of cars. A growing and everyday more globalized world is no zero-sum game: both Software as a Service and client applications markets will keep on growing.
2. people living in cities (in our parallelism, people who have the choice ie well-off enough to be able to access the Internet) tend to be huge fans of cars, if they have a car at all. But pay well attention to car owners consuming habits and you’ll notice that in many, but very specific, occasions they choose to take the subway rather than driving. In other words, car drivers use a mix of both worlds to go from one point to another.

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I’m glad to announce you that my dear friend and HEC Paris fellow Raphaël Encaoua (left on the picture, I’m on his right, and as you can notice, we’re both thinking hard) joins the Tech IT Easy adventure as a guest blogger.

Raphaël is a would-be entrepreneur in the field of medical tourism (see his dedicated blog right here), with a genuine curiosity towards information technology: Raphaël is willing to share with us his thoughts on how he will leverage web technologies in his new medical tourism venture. On top of that, alongside with Lucien who had joined us to blog about Web 2.0 & China, Raphaël will be our Asian market expert: Raphaël just came back from an 18-month long investment banking internship in South East Asia (Vietnam, Singapore, Thailand, Japan, Malaysia etc.). His understanding of this key market will undoubtedly be something to watch in his upcoming posts that will probably also deal with web medicine, and the use of information technology in the health & tourism industries in general.

So it seems the Tech IT Easy team, now formed of Alexandre (French & Russian, technology – media – telecommunication M&A analyst in London), Kari (Finn, IT project manager @ a leading energy corporation in Helsinki & Stockholm), Steve (French, background in strategy consulting & online media management), Lucien (French & Chinese, IT consultant, Web 2.0 expert), Vincent (German & Dutch, former marketer @ Sony, writing a thesis on incubators in the Netherlands), myself and now Raphaël, keeps growing and growing. Guys, I’m so glad that you’ve found in Tech IT Easy a platform that fits your will to share your passion about technology. I guess and hope there will be more to come, so that we can move to a proper Tech IT Easy – not ‘jeremyfain’, URL and perhaps monetize our (quality?) content.

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