As a preamble, I am a music enthusiast. I purchase around 50 albums
per year, at home I spend more time listening to music and doing nothing else
than in front of a TV or computer, my stereo rig is worth the price of a
small sports car, and my "collection" of albums is 2400 CD's strong.
And of course I regularly rant against the music industry that keeps
innovating with legal actions against their customers, instead of trying to reinvent itself around reality: music distribution can never be the
same once digitalized, and suing and trying to protect an obsolete value
chain isn't necessarily the best way to stay in the game.
But rebuilding intermediary value in the music industry is challenging. One needs to invent a new, compelling, useful model carrying enough consumer value to recreate eroding margins. I do not value CD printing anymore (I now buy most of my music online in HD formats (AIFF, Lossless, Masters), except when a smart major executive decides that digital music should stay low-res so I must buy a CD. I do not value "major brands" as I can't remember ever thinking "Hey, let's buy an Universal record, it's usually better than Warner's stuff". I do not value the fact that when I buy a 15€ CD, the artist will get less than a 10% share while "majors" whine about not being able to get enough revenue for doing a poor marketing job, if any, on 95% of the artists they "protect".
The solution? Maybe getting smaller is a good idea. Way smaller.
NoFormat! is a tiny label/producer, issuing 3 to 6 albums a year, and working with about 20 artists in the Jazz, World music area. Each album is high quality production, and delivers 50 min of pure musical emotion (if you are into world and jazz, that is).
Their small size allows them to spend real quality time with all artists, follow them, nurture them, push them, and it feels that way.
Their small size allows them to really hold their editorial line: quality African world jazz fusion, always emotional and surprising. This is a niche, a scarce one, but at this level of precision, it is actually much easier to curate than if you were into "world music".
Their small size allows them to be caring with both artists and consumers. They have the time and scale to organize private concerts in very small places, to handcraft and design every piece of material they produce (including covers, booklets, posters, all merchandising), giving their label an almost Apple like feel. I enter and stay in a very coherent, calm and beautiful universe. It's tiny, compact, but it's perfect.
Small is a human scale. And some products, noticeably those who fulfill emotional needs, are fundamentally human.
How to live sustainably on a small business? Well, No Format! innovates: Subscription!
nb : Apologies to english readers, but try and watch their video (in french), it is hilarious and straight to the point.
No Format! launched the Pass. The Pass is a straightforward offer: for 50€/year (4 albums in retail) I get:
- All the albums of the year (3 to 6)
- Invitations for private concerts, rehearsals, studio recordings, diner with the artists…
- All of the merchandising, books, DVDs…
- A pass to enter the community, to participate and engage
That's a fantastic bargain to me. And it allows No Format! to finance itself up front, with positive cash flow. And No Format is a small team.
They are just starting; they probably need 5 to 10K subs to really be able to sustain their model. Finding 10,000 subscribers over the world is a challenge, but a reasonable one in a connected world where we all can have global reach.
They are not the first ones. Peter Gabriel's Society of Sound has also been providing music by subscription for 3 years with a similar model (just downloads of HD music, but all albums are "avant-premiere" distributed 6 to 8 months before hitting the shelves). I find it encouraging that some new models emerge everywhere. This is a trend.
What do we take from this? Few things.
- Everyone talks about scale and critical mass, but to be truly innovative, we also need to consider that a scale has 2 extremities: small and big. Although we would love to get Facebook or Google or Amazon scale, we can't forget that small has its virtue, and can be profitable and sustainable. I have as much respect for empire builders as I have for small, tense, beautiful business that can sustainably provide for a small community. Both ways are real choices, both elegant.
-Scale is part of a business model. No Format! cannot exist with 20,000 artists and issuing 5000 albums a year, Amazon cannot exist without millions of sku's, customers and transactions per day. Amazon has its function, so does No Format!. Sure you need a 100 million No Format! to have the economical size of Amazon, but one No Format can sustainably (I hope) feed a 20 person ecosystem. And there are many many niches.
- There might be no room left for "medium size" models. Now that you can reach customers, suppliers, producers, a global ecosystem worldwide with and AdWords campaign, that technologies allow you to create, produce and distribute high quality content or services for almost no costs relative to 10 years ago, you can shoot for very very big, or very very small, but I have a hard time finding models that would carry sustainability and profits being medium sized. And in the digital world, I suspect "medium" leads to "mediocre". We've had enough mediocre products and services pushed to us through distribution monopolies.
- Before deciding if your cool is to go big or go small, think about your product values: If its money and value driven (commodity), shoot for big. If its human and emotion driven (premium), try small…
I do have other worthy example of thriving compact and fantastically designed businesses: WildCustom Guitars, 2 dudes in Vichy, hand manufacturing stunning hard rock guitars in very small series is one. I met them and they designed small into their business model. They do not want to take over the world, but want to make sure every guitar they sell “over fulfills” their community.
I can see a world with giants handling massive platforms, fulfilling infrastructure and services that have to be huge to carry value, and deliver me all I do not want to think about, aside a world of thousands of small, compact, beautifully crafted companies delivering the stuff I really care about. I cannot see where average and “mid size” business fit in that world. Volume is volume; premium is premium, no more room in between.
In the past months I’ve been to more weddings than I have been in my entire life. Last weekend alone I did two weddings and a engagement party. If summer is the season for love, then you’ll LOVE this online wedding invitation, without the graphical limitations of print.
This modern day fairytale invitation "Jess and Russ" is a collaborative piece curated and created by the designer couple (Russ Maschmeyer and Jessica Hische) and their talented posse. A tell all story about how they met down to the finer details of the engagement, make this the sweetest CSS3 and HTML5 you’ve ever seen.
As a regular runner, the recently announced Google Glasses made me realize that disruption may arrive more quickly than expected in the sports tracking area.
A big challenge for runners during training and competition is to track their time and pace in order to optimize their effort, with the aim of improving personal records.
The classic solution
Usually, you can see people running with a watch, a simple and reliable means to track time.
It gets harder when it comes to personal pace monitoring: you have to learn your theoretical time per mile/km beforehand, and then do your own math along the way to check that you are keeping a good pace. And the longer the race, the harder the computation becomes…
Some would say that multi-function (& bulky) watches are already out on the market … as a guy with skinny wrists, I would answer that I have found another solution.
The alternative: DJ-talking-over-the-music phenomenon.
Running with your smartphone is a nice alternative, though you will need specific add-ons to store and protect your device.
Moreover, if you go running with your phone, you may want to listen to your favorite power songs, those you shamefully hide from your hipster friends but that help - a lot - for the last mile (yes, I am talking about Lady Gaga, Usher or LMFAO). And this is where the coexistence of your music player and your favorite sports tracking app (Runkeeper or Nike+ for instance) may endanger your performance.
Let me explain.
You are just sweating, giving your best to push on your legs to the beat, waiting for the bass-dropping cliff, and, at this precise instant, the music fades out and a cold voice takes 20 to 30 seconds to tell you that your pace is 11.7km/h instead of 12.5km/h and your time is bla bla bla … SO so annoying.
The future: Shadow running
Here is the situation: I want to go for a run without being annoyed by this lady saying robotic things in my ears. Even if it is Paula RadCliffe (smart move, Nike guys, by the way).
Why don't I put something in front my eyes to check if I am OK with my expected tempo ?
I am not talking about figures and time displayed in a pair of goggles, as for military aircraft pilots. I am thinking of a more sensitive approach of self tracking.
As 1500m sprinters usually have a sparring partner (we say "lièvre" in French) that maintains the tempo for the first 2 or 3 track loops, I want to have another "me" before my eyes - or a shadow of me, rather - running at the right pace on my selected route. A "me" I can compete with, knowing its exact metrics and attitude.
And a combination of Google Glasses, a classic tracking app and a phone with a good GPS will, for sure, do the job. I want (to build) this.
Just like in the Nintendo video game Mario Kart, with its famous Ghost Mode.
To open up the discussion, I'm sure many of you have ideas for such a product! Comments are open ;-)
A mouse of a company was eaten by a giant and this made most of the tech news for a week.
Google bought the company Sparrow that was developing a great email client for Mac.
Congrats to the team – about 5 people in total from what I know – for the really great product, first, but also for getting such exposure and acknowledgement from the industry: I always thought successful start ups and entrepreneurs are not about getting a check but about lasting, making a living from their passion, changing the world for the boldest, their industry for the focused.
In France, it was a matter of pride : A Sparrow which sings cock-a-doodle-do. Our lovely vibrant ecosystem sang the praise of the founders. And I've always said the more the big Californian guys come and shop in Paris, the better for our shops… So, this is absolutely good news.
Part of the hype was an interesting dispute on whether or not Sparrow will be stifled by Google. AcquHiring for sure, we all understand what Sparrow’s team could bring to Gmail but what about the product, the users, … ?
Matt Gemmel, here, made fun of all the moaners who felt robbed by Google’s acquisition. His point : "The Sparrow guys have homes, and families. They have every right to cash out and take new jobs. They’re winners." Entrepreneurship is a matter of freedom even before competition, I also agree with that.
In this great post, David Barnard makes a clear statement : "Sparrow did everything right. They built an incredible email app with broad appeal and released it into the hottest software market the world has ever seen. And yet it was a financial flop." (…) "And that’s the Sparrow problem, break-even was not sustainable. They had to find a way to turn a profit — lots of profit — to provide their investors a decent return."
Jeremie Berrebi (Co-founder of Kima Ventures which held 28% of Sparrow - bravo Kima!) says Sparrow was very profitable, but I take no risk in guessing it was not a multimillion dollar business.
And this is the problem of millions of developers right now: if the best of us all, the winners, have no other option but to be taken over, eaten just like Sparrows by the big cats, is it a fair game?
This week I had dinner with one of my closest friends. An entrepreneur in the mobile gaming industry. He told me he invested tens of thousands of euros to create a great game, with >4,5 * notes by over 6,000 users and this represented a turnover of… 5,000 euros in 6 months.
So where is the market???
It is a great opportunity for me to get back to one of our projects. We never had any chance to share our experience. Our subsidiary Applidium (an incredible engineering and design team) published last year an awesome game in the Appstore.
This was a tremendous success. Let’s have a look on the results :
- 9.7 million downloads
- 700k games played everyday on average
- 5 successive days in the general Appstore Top5 in France
- 11 successive days in the US
- ranked #2 in the US App Store (behind Angry Bird Rio)
- ranked number 1 in more than 10 different countries
- more than 2 months ranked in Games Top5 in France
- almost a month in the US
- it never left the Games Top200 in France and in the US
- gamers come mainly from the US and China
For us, this was a surprising success. It was hard work but we enjoyed gathering all this hype, positive feedback and impressive metrics. We know that we were lucky and that many studios - and we are not a studio - would dream of reaching these figures.
But at the end of the day, what did it represent for Applidium and faberNovel’s bottom line? We learned a lot for sure, we built an asset, a customer base, etc… But by Sillicon Valley standards, it couldn’t pay more than… 2 full time engineers.
And the price of success was to be honored to have Google, again, coming on to our CTO and some of our engineers to hire them, offering to double their salaries.
I don’t know if you remember that back in January 2010 we cracked the more than obscure ranking algorithms of the Appstore here, at faberNovel, as part of our research practice we are always looking for the dynamics and the principles which are becoming the "system", so quickly when you think of the digital economy.
So, Sparrow’s story has an happy exit if not an happy end. But my problem lies with the system we are contributing to, this forest of birds and kittens hidden by Rovio’s Angry Birds and Instagram. Apple, Google, Amazon, Facebook, Microsoft, … should share more of the value generated in their stores to help create more independent, successful start ups.
And remember, the economy needs us! We are the ones who can create jobs. I very, very much respect 37signals, but we need millions of those and not only 4 of 5 super powers (and look, I didn’t use "would-be monopolies")…
To conclude, I have always been looking for something from the french culture that we could share and give to the technology scene. What if it was demonstration and strike?
Come On Lumpen Developariat, go on strike ! Let’s stop for a few hours to play what is too much of one-sided game and show some independence.
This is not April 1st, to be honest, it may be too hot in Paris right now and please excuse my rantings, but I really feel this balance of power has to be taken into account. By all the food chain. From the Sparrow to the Google.