January 23, 2014
Photo: Mark Skipper
As an observer of the local and international technology start-up scene, I have the opportunity to be quickly exposed to emerging trends. In this post, I’d like to share with you ten areas that I think are particularly promising in the coming year. And whenever possible, I’ve also identified Montreal startups already operating in the space. Without further ado, here’s what I see in my crystal ball for 2014.
1) Local vertical marketplaces.
Players like Airbnb (hotels) or Uber (taxis) have shown in recent years that you could create next-generation local marketplaces by addressing a very specific vertical. These players are generally characterized by content depth, better consumer decision-making tools and/or complete vertical integration up to the final transaction. Knowing that there are 4,000 vertical categories in business directories, we are still in my opinion in the infancy of these next-gen vertical sites.
2) Software-as-a-Service (SaaS) tools for SMBs
2013 saw the emergence of companies offering a variety of SaaS software for SMBs (small & medium-sized businesses), especially in customer relationship management, accounting and marketing. I believe we will see other small enterprise software tools launching in 2014 particularly in the offline-to-online space, to optimize sales when a potential customer physically visits a retail store.
3) Small hardware + software products
Following Google’s acquisition of Nest for $3.2 billion last week, this is the sector that will be the most active in the next few months. The democratization of hardware development in recent years is mainly due to the emergence of tools enabling rapid deployment (whether in prototyping or crowdfunding). Top projects usually include a user-friendly, well-designed software layer and are made by the best industrial design talents. With its smart watch, Montreal-based Neptune is a good example of this trend.
4) Digital currency platforms
In 2013, everyone was talking about Bitcoin, the emerging electronic currency, but very few people know that there are now dozens of other so-called cryptocurrencies. Most news articles focus on the increasing value of Bitcoin, the speculative side, but what’s really interesting with electronic money is the emergence of distributed currency/transaction platforms (and the potential around micro-transactions). If the topic interests you, do read Marc Andreessen’s take in the New York Times. Montreal startups Bylls and BitCredits operate in this vertical.
5) Cable companies ready for disruption
I think disruptive innovations will soon threaten CableCo monopolies especially around television broadcasting. Netflix’s strength, the “cord-cutting” trend, the availability of legal streaming content, forced bundles that consumers don’t want are all elements that support this trend. In my opinion, there are dozens of interesting opportunities linked to this trend.
6) Artificial Intelligence and ambient technologies
In 2013, my biggest revelation was Google Now, the almost magical mobile application that analyzes my data exhaust (geo-location, Gmail inbox content, etc.) to provide me with useful real-time alerts such as travel time, weather, flight itinerary, package tracking, etc. We talked a lot about “Big Data” in 2012 and 2013 but 2014 will be the year where we try to proactively make these large data sets useful to users. There are dozens of interesting opportunities here also.
7 ) Security and privacy
Revelations of massive spying by the NSA and targeted advertising abuse by large Internet companies is leading to the rise of new products enabling users to better protect their privacy. Montreal-based Syme is building a software solution that allows you to share content and messages in a private environment. Multiple opportunities exist in this area too.
2012 and 2013 saw the emergence of the “quantified self” movement and the launch of multiple applications related to physical health improvement (sleep better, eat better, etc.). This sector stays red hot in 2014 with new applications that can help improve your mental health (relaxation, yoga, stress, etc.). Montreal startups OMSignal and Hexoskin operate in this sector.
New food technologies in either infrastructure (better distribution, traceability, etc.) or next-generation food products (nutraceuticals, organic and local food, new types of food, etc.) will be top of mind in 2014. Lufa and Provender are proud Quebec representatives in this technology sector.
This article originally appeared in French in my Journal de Montreal blog.
Update: Boris Silver, Co-Founder and President of FundersClub, just blogged about 10 things the broader tech venture capital community is paying close attention to:
- Big Data
- Quantified Self
- 3D Printing
- The Internet of Things
- Virtual Reality
Definitely some overlap with the things I’m watching. Always interesting to compare.
January 29, 2013
Friends and colleagues who’ve known me for a long time know that I love to regularly polish and gaze into my crystal ball to try to forecast trends and predict the future of technology. It’s a game I really love to play. With a well curated Twitter feed, I’m able to “listen” to opinion leaders and early adopters throughout the year, day in, day out, and instinctively identify what technology trends seem to be important today. In addition, the end of the calendar year is also a great opportunity to digest and compare notes with other people via “2013 trends”-style blog posts. As you’ll see in the list below, those trends go much further than local & social (my blog’s theme since 2006), probably reflecting my personal interest list as well (or maybe everything is social and local now, and we don’t need to mention it anymore!)
Without further ado, here are a series of technology topics that I think are important right now (in no particular order):
Screen and usage fragmentation
- Internet usage is fragmenting and this has a tremendous impact on product design and features.
- Size of screen and in-home/out of home use impacts design and usage patterns.
- Without a doubt, today you should design services with smaller screens in mind (streamlined, fast loading, bigger-sized fonts, etc.).
- I still believe product prototyping (or beta versions) can be done on the Web before working on native mobile apps.
- If you launch mobile apps, launch iPhone & Android versions at the same time. Currently intrigued by the potential of Windows 8 and the Blackberry 10.
- The flavor of the month in content advertising: ads and content become interchangeable. This is not new (sponsorships and advertorials have existed for a long time in traditional media) but we see many experiments these days. By the way, I hate the name (same with “transmedia” but I digress).
- Rebirth is probably related to the failure of display ads/banner advertising to deliver solid value/ROI. On a related note, the New York Times is trying to “save” the banner ad.
- But beware! The Atlantic Monthly showed us that the format can be problematic (and The Onion had good laugh…)
- Related: brands are now also becoming content producers, hiring journalists and creating new content.
- Social media has matured. It’s now present across the organization, not just in one department.
- We’re slowly seeing the disappearance of social media experts (being integrated in marketing-communication departments) and we will eventually see the disappearance of community managers (integrated in customer care).
- Social media advertising is still unproven and, as executed today, is not exciting, very far from the original conversational marketing promise.
- Important concept but there is a bubble. This will probably be part of every technology infrastructure and we will stop calling it that way.
- Alex Howard (O’Reilly Radar) thinks that data will be more liquid, “ flowing across sectors previously stuck in silos”.
Enterprise products and services
- Enterprise is hot again, as it generates faster (and more) revenue than consumers products.
- It’s cyclical. We’ve seen that cycle before, circa 2002-2004.
- Dark social (defined by Eric Wheeler in Fast Company) is a form of word of mouth that happens in email and instant messaging. These still need to be leveraged and mined. Social media didn’t kill these methods of communication and they’re more alive than ever.
The sharing economy
- We’re seeing more and more peer-to-peer marketplaces (often called Collaborative Consumption).
- It leverages underutilized physical goods or resources (like time)
- Examples include Taskrabbit, Uber, etc.
- We’re seeing the emergence of vertical marketplaces (players like Uber, Airbnb, etc.) that are completely integrated along the customer purchase decision process (from research/pre-shopping to merchant comparison to merchant selection to transaction to post-purchase, in one environment). I believe this is where the future of local search lies. Look at the top 100 Yellow Pages categories. They will each have a category killer in the next 10 years.
- Related in part to the sharing economy.
- We’re seeing a push by citizens for a more transparent government, asking for open data and more accountability. Governments are slowly opening up. It’s still early but this is a huge democracy game changer. It obviously has tremendous impact in our local lives.
- You can read about open governments in this Aeon Magazine article.
- Privacy will be top of mind for the next 3 to 5 years. It can now be an important feature of new services. For example, SnapChat allows you to share pictures with your friends and those pictures are available for up to 10 seconds only.
- People worry that what they’re sharing can be used against them and I believe that a better social networking solution will come along in the next 5-10 years and change the game via “privacy” (and it’s probably not Path).
- This trend leads us directly into “personal data ownership” where we own our data and we can transport it anywhere we want. We can also give permission to use it for marketing/targeting purpose, etc.
- Related to big data, these tools are arriving to provide marketers with a better understanding of customers and a better targeting of advertisers.
“Lead with design”
- When markets are crowded, design becomes a strong differentiator.
- This is the mantra right now in Silicon Valley.
- Merchants/brands are being equipped with dynamic pricing/yield management tools to optimize pricing and maximize revenues.
- Consumers will be equipped with solutions to help them time their purchase to get products/services at the lowest price.
- It’s an arms race and is related to the big data trend.
- Now with less papers, more digital, more mobile (ex: Passbook on the iPhone)
- We’re finally seeing the return of hardware. Easier and cheaper to manufacture than before.
- Expect many new hardware projects piggy-backing Arduino (open source electronics platform) or Raspberry pi or Beagle Bone.
- 3D printing is probably part of that trend.
- Hardware needs to marry perfectly with software. Both skills are needed now for new projects. Design is key.
- New hardware solutions (like Fitbit) are enabling the capture of the “physical graph”.
- Related to the “Internet of things” trend
- Of note, if you have children, you should buy them toys that will prepare them for this new life. Pamela Fox recently wrote a great blog post about “Getting Kids into Programming”
Local manufacturing/ Insourcing
- Local manufacturing is back.
- It’s better for local economies, for the environment, and companies can charge more today for “local” products.
- You can outsource elements of production to Asia (take a look at Alibaba.com) but products are often designed and assembled in North America/Europe.
- The great funding democracy movement. More money available for more projects.
- Some growing pains: i) projects that are not delivered and ii) without a network (or help from traditional media’s amplification), it’s still difficult to raise big money.
Humans are data/bits
- Rise of health startups (DNA analysis, life optimization, weight loss, etc.)
- Self-driving cars are being tested (Google, Audi).
- Emergence of an in-car apps ecosystem.
- Volvo’s Vision 2020: “By 2020, nobody shall be seriously injured or killed in a new Volvo”
- Will we still need a driver’s licence in 20 years?
- Symbolized by products like Google Glass or Memoto.
- Things are happening around us and data is collected without friction.
Products/services that have seemingly magical properties or give consumers pretend super powers
- Related to the design-first and hardware trends.
- Heavy lifting done by hardware and software, not the human.
Time as a currency
- I first wrote about the Temporal Web in 2010. Still a very important trend.
- Trendwatching thinks that “in 2013, consumers will look to their mobile devices to maximize absolutely every moment. Hectic, urban lifestyles mean that no amount of (micro) time will be too fleeting, or activity too absorbing, to cram in more content, connection, consumption or simply more fun.”
- Total local advertising revenues for 2011 will be $135.9 billion, down from the $136.2 billion it forecast earlier this year
- Traditional media segments such as Yellow Pages and newspapers are experiencing the largest downward revisions
- U.S. local online/digital advertising revenues will rise to $23.3 billion in 2011, compared with $22.3 billion predicted earlier this year
- Local online/ digital advertising revenues will be 17.2 percent of total local advertising revenues in 2011, up from the earlier forecast of 16.4 percent. By 2015 that share will increase to 25.4 percent, up from the 24.7 percent originally predicted
- The overall local media market will grow slowly over the next five years, at a compound annual growth rate of 1.7 percent, reaching $149.4 billion by 2015
The rest/details of the forecast will be revealed at their next conference ILM West 2011, in downtown San Francisco, December 12 to 14. I will be attending the conference. BTW, I just reserved my hotel using Hotwire and I found a 4-star hotel within walking distance for $109/night. See you there!
As some of you, I’m coming back from a great vacation in the south of France. I was mostly offline for the duration of the vacation but still regularly picked-up French newspapers while I was there, most notably Le Monde (for national and international news) and La Provence (for local news). I kept a few articles that I think were blog-worthy and I’m going to share those with you in the coming days.
The first article titled “Rebond du marché publicitaire français en 2010″ (Advertising spending in France bounces back in 2010) was published on October 1st in Le Monde (paid link). The article discusses ad spending in France in the first semester of 2010 by various media vehicles. Data comes from Institut de recherches et études publicitaires (IREP) and data can be found here (.pdf).
I found the following interesting data points:
- Television is the number one media in terms of ad spending (by far) with 1.7 billion euros and a growth of 12.8% over the same period last year
- “Internet”, it seems, only takes into account display advertising (i.e. banners)
- “Internet” gets 264 million euros in spending, a growth of only 9% vs. same period last year. Outdoor advertising growth is almost as much with 7.3%.
What it means: a couple of observations. First, television still rules in terms of ad spending. That media hasn’t (yet!) been hit hard by the Web and still benefits from huge ad budgets. The atomization of TV programs (think on-demand online streaming) is still in its infancy and will not impact TV’s numbers drastically for at least 3-5 more years. Second, I’m not surprised display ads are not growing as fast as we would expect the Web to grow. Even though it is still the preferred method for online advertising, I’m not a big believer in its future. Third, I’m surprised IREP doesn’t do a better job at tracking online advertising in general. PagesJaunes Groupe, the French Yellow Pages, saw their online revenues grow by 6.7% just in the second quarter of 2010 (see press release in .pdf) for a total of 263.9 million euros. That’s an equal amount to what’s recorded by IREP for “display ads”!
June 2, 2010
As a startup entrepreneur for the last three years, I’ve had the chance to observe the online scene both locally (Montreal), nationally (Canada) and internationally (US and Europe mostly). I’ve organized and participated in many unconferences and camps (most recently last week at WebCamp Montreal) and I’ve spoken at conferences in Europe, the US and Canada. I’ve met many entrepreneurs all over the world and I’ve coached aspiring ones. I’ve traveled to Silicon Valley countless times and had the opportunity to breathe the air there, trying to identify the various cogs of that ecosystem. I’ve realized that, if the right conditions are present, tremendous value can be created by building Web products.
My perception of the local online industry (Montreal specifically) is that we’re really good at online marketing / communications / advertising and we use this as the main method to generate value. We do build many online products but they end up being used in specific time-sensitive ad campaigns, ephemeral things, and when these ends, these products become orphans. This perception is obviously influenced by my product management background. I’ve been building Web products for more than 10 years and some of the things I’ve created have influenced whole industries and are generating millions of dollars in revenues.
Montreal has all the ingredients to become a hotbed of Web development and startups (I wrote about that a few months ago). After all, we already did it for the videogame industry. There is a lot of money for interactive projects, especially in large organizations, but we’re trying to replicate the old broadcast/advertising model online. There must be a better way to do things.
To re-think the way we work as an industry, I’d like to inspire myself from ecological terms coined in the last few decades: sustainable development and the waste hierarchy (known commonly as the 3Rs, reduce, reuse and recycle). Environmental science learnings can teach us to create more value with less “material”. Based on my personal experience, here is my manifesto for sustainable Web development, to create a better, more innovative, more valuable Web ecosystem.
- Think “product”, not “ad campaign”. Use budgets to create things that will last. Think how you can achieve your communication goals by building stuff instead of buying media placement.
- Do not re-invent the wheel, Focus on building value on top of existing material. Re-use existing standards. This is how we’re going to accelerate the pace of innovation.
- Use open source software. You’d be amazed to see how many technology components are now available in open source. You get access to whole communities when you use those technologies and you speed up innovation.
- Leverage existing APIs. You’d be amazed to see how many content and technology components are now available via public APIs. Use them, again, to speed up your development.
- Less talk, more build. We love our social time, drinking beers with industry colleagues and imagining a better world. If you want the world to change, go in action mode. Just do it!
- Give back. At the end of a project, if you’re not going to reuse the code, open source it. If it’s not going to be used at all, give it back to the community.
- Do not focus on “competitors”. The online market is huge and will be so for the next 20 years. Think about disruptive ideas, think about incremental ideas but focus on your business and the opportunities.
- Work with other companies. This is the corollary of the last bullet. Can you participate in common projects that will benefit multiple organizations?
- Use locally-produced technologies in your projects (when possible). This rewards risk-taking in the local ecosystem.
- Share your best practices with others. Blog, speak, be open, You win on execution, not on ideas.
- Mentor others. Make sure other people benefit from your experience. Be generous with your time even though that’s probably the most precious resource you have.
- Participate in the ecosystem. Attend events, write blog posts, take position on important topics.
- Learn from failure and respect those that failed. Silicon Valley folks believe you can learn from failures. Do the same.
- Think out of the box. Don’t be afraid of pathways less traveled. Challenge people.
- Launch your own company. If you really believe in your ideas and your current professional environment doesn’t allow you to execute them, start your own company.
- Listen to builders, innovators and “crazy” people in the industry. They sometimes sound crazy but listen to them. They see things you don’t see.
- Create long-lasting value, not short-term results. ‘Nuff said.
Do you agree or disagree with what I wrote down? Have I missed anything? Feel free to leave a comment. This is the beginning of the conversation…