When a new technology enabler arrives, entrepreneurs try to build businesses around it. And numbers of new startups really explode when the new technology enabler is sufficiently distributed to customers. For example, when more homes started getting the internet or when smartphone adoption explodes in a country, entrepreneurs and venture capitalists are in a mad rush to build businesses and deploy capital respectively.
Selling books around in a retail store? Then sell the same books online. Selling diapers in a retail store? Then sell the same online or as a subscription. Do you call a landline phone to book a cab? Use your smartphone to book a cab. Do you book movie tickets by standing in a queue? Then do the same online. Are you booking hotels calling a landline number? Do the same online.
Some successfully businesses have been built by doing the above. But what has changed is only the customer ‘interface’. The books remain the same, the diapers remain the same, the cabs remain the same, movies are produced in the same manner and the hotels remain the same.
What is truly transformational is when the underlying products themselves change. That is a true reimagination of business. Think about booking hotels. With AirBnB you can convert your underutilized living space into Hospitality. The underlying product that was transacted – the hotel room in itself is now different. AirBnB projects that during the Super Bowl weekend in Feb 2016, over 15000 guests will be staying at AirBnB listings.
Salesforce reimagined how software services will be used and paid for. AWS has reimagined how you can use computing infrastructure. Wikipedia has made it normal to pay 0$ for the biggest encyclopedia ever created.
With new technologies like Mobile, VR, 3D Printing, Big Data, Machine Learning AI, it is increasingly possible to reimagine businesses and how things are being done like never before. And these technologies are getting better and better. Take a look at the following image from Qualcomm.
There are increasingly new sensors embedded in Mobiles. It is possible to think that Healthcare can be reimagined with all these new sensors in the Mobile. Some other sectors like Health Insurance too can be reimagined.
Many businesses can be reimagined if we remove any assumptions and start from scratch (the thinking called ‘First Principles’). Elon Musk talks about such ‘First Principles’ type of thinking:
“The normal way we conduct our lives is we reason by analogy… With analogy we are doing this because it’s like something else that was done, or it is like what other people are doing… [With first principles] you boil things down to the most fundamental truths … and then reason up from there.”
Let us take the example of Consulting. It is possible to simple build a marketplace online connecting top consultants and clients improving the discovery and pricing. Some companies like Hourly Nerd and Expert360 are doing this. But that would just be replicating and not particularly reimagining Consulting as a business.
How can Consulting be reimagined? There are tons of free high quality content on the internet – blogs, articles, journals etc. Can you use technology to convert all of those into high quality advice? With Big Data, Machine Learning and AI it is increasingly possible. Startups like Orbital Insight are applying Machine Learning to satellite images to advice clients in Retail, Mining and Agriculture etc.
Note that startups like Orbital Insight use Big Data and Machine Learning while Hourly Nerd and Expert360 still use just the Internet without using any of the newer ones.
As a rule of thumb, businesses will be fundamentally reimagined as newer and newer technologies come about.
For example, the Internet sparked promises of a virtual workplace where people can login from their homes without having to show up for work (at least for the white collar ones). That clearly didn’t pan out well. I still have to go to office braving the Bangalore traffic.
But can Virtual Reality and Augmented Reality, two newer technologies deliver on that promise of a virtual workplace? There is a startup called AltspaceVR whose tagline is ‘Be together, in person’. It’s developing a virtual reality platform in which people can connect with one another in a kind of digital lobby. Represented by humanoid avatars, AltspaceVR users can speak with one another, communicate via body language and share experiences. It works whether users are wearing the cheaper Samsung Gear VR headset, or the high-end Oculus Rift or HTC Vive Pre.
VR might finally enable people to work remotely and with no loss of accountability and productivity. There will be profound implications of this in other areas as well. A significant number of vehicles on roads is about going to work. Congested cities are because a lot of jobs reside there. Real estate becomes costly in congested cities. Commutes are longer in such cities. If a good enough Virtual Workplace is rendered, there will be profound implications. People can spend time with their children more, move to a place with far lower rent, pollution will decrease etc.
When you think about the plans of AltspaceVR, Facebook’s acquisition of Oculus Rift two years back makes a lot of sense. Social will be huge in VR. Distant friends can connect with each other (the core service of Facebook) via Virtual Reality and can feel like being in the same physical space wherever they like to be.
Similarly VR will likely reimagine movies as we know them. Users might be able to be in movies or be able to direct the flow of a story based on their actions.
Think about News. The Internet has been a great democratizing medium for news. More people can write their opinions, people can amplify their voice through tweets and hashtags and people other than reporters can arguably break news.
The above was a tweet by a little known user Sohaib Athar unintentionally breaking the news of the Osama Bin Laden raid in Abbottabad.
There has been some successes in the Internet only news. Huffington Post and Buzzfeed (interestingly both co-founded by Jonah Peretti) are some of them. There has been some flirtations with different revenue models. New York Times makes money from monthly subscriptions of their digital content rather than relying on advertisements. Buzzfeed makes money from native advertising. They publish sponsored content that you wouldn’t even realize. For example, here’s one of its ‘lists’ – something that it regularly publishes: “15 bands that probably wouldn’t exist without Led Zeppelin”. Who wrote it? Spotify! “9 things that have changed in the last 20 years” by… Motorola!
The distribution of news has changed. But how the news is produced is yet to be fundamentally reimagined. Just like tens of thousands of volunteers have built Wikipedia, can hundreds of thousands of citizens be brought together to build the best unbiased investigative journalism platform? People consume news and pretty much don’t follow up on it. Also, some very important news doesn’t get much attention. Can you bring together journalism, the power of social media and the power of Crowdfunding to take immediate action following reading some news?
Food is another interesting example. Some very bold attempts are being made other than just connecting customers with restaurants. Hampton Creek is an ambitious food startup that wants to rethink food from the ground up. The company swaps meat based proteins for plant based ones while trying to retain the taste. The company currently has three products – Just Mayo, Just Cookie Dough and Just Cookies (all egg free products) and has distribution deals with Walmart, Safeway, Target and Costco. The company achieves better results because of its database of thousands of species of plants and uses machine learning algorithms to model likely ingredients in its products. The company is at the intersection of plant biology and machine learning (and good branding).
There’s a startup called Impossible Foods funded by Google Ventures which makes tasty burgers where the ‘meat’ and cheese is entirely made from plants. Here’s a video on the same. The meat-free burger bleeds and sizzles just like meat!
How long would people recruit with resumes? If you were given the opportunity to reimagine recruitment, how would you do it? Would you just collect and parse resumes online? Would you filter candidates according to their GPA? Or would you use new technologies to quickly rate them from other exhibits like blogs, Quora answers, Github submissions etc.?
How would you reimagine education? Are lectures necessary? What should be the role of a human ‘teacher’? Can people learn from their homes? How would you change the curriculum? Would students solve tough real life problems while they are learning? What new technologies would be used?
There are so many opportunities with new technologies to reimagine businesses. Will investors fund such businesses? Will Government allow these business models to be deployed? But I’m sure bold entrepreneurs are not in short supply!