Speed wins the startups game, according to entrepreneur Howard Tullman
Howard Tullman has been called "the most accomplished, best-connected entrepreneur you have never heard of." We recap his keynote from CEC Forecast about six tech trends to watch.
Image: iStock/bowie15
Howard Tullman, CEO of digital startup incubator 1871, was the keynote speaker at the third annual Chicagoland Entrepreneurial Center (CEC) Forecast in January 2014. CEC manages 1871, which is located in Chicago's Merchandise Mart.
Tullman has founded 12 companies, including the Tribeca Flashpoint Media Arts Academy, CCC Information Services, Tunes.com, the Rolling Stone Network, Imagination Pilots, and Experiencia. He is or has been at various times "a serial entrepreneur, investor, advisor, art collector, teacher, lecturer, lawyer, (and) marathon runner." Inc.com called Tullman "the most accomplished, best-connected entrepreneur you have never heard of."
His talk was never dull (he often employed, ahem, colorful language) and included observations and insights on major trends in technology and entrepreneurship from someone who's been in involved in both for decades.
Key takeaways from the talk:
- We are more concerned today with the quality of our experiences and the utility of things than with possession.
- The "sharing economy": we will use assets more efficiently and economically, saving time and money, and acting more responsibly.
- Beyond interest graphs, the next level is to know where the consumer is going. Digital prognostics will supplant diagnostics and analysis.
- If you are "stuck in search," you are losing a step on the competition. Projection and prediction of online behavior matters.
- Speed is most important today. Speed and not size wins.
- Companies can make a personalized offer in the short time required to load a webpage. Think of this as the "shifting sands" underneath digital conversations.
- Computing advances from "big guys" like Google are squeezing out smaller competitors. It's great for consumers who enjoy mass customization, but entrepreneurs need to produce solutions for SMBs.
- Wearable technology enables us in every kind of business sense and context.
- Analog is moving to digital, and digital means video. Video-enabled communication is the default way we share.
- For anyone under a certain age, the first screen is the mobile device. Video is how a lot of learning will take place. The world, including education, will adapt to this model.
- Collaborative commerce is the idea that, if we're sharing, we'll be able to work together. It provides a powerful set of resources that people are still figuring out. Collaborative commerce will be become a bigger part of the economy.
- Wiki work: the workplace is everywhere today and is no longer constrained by time and place.
- Wiki work can pull together an enormous talent of people, recapture opportunities that were previously downtime, and increase the productivity of the whole country.
- With the trend to crowd-sourced, individual work, places that create community, like 1871, will be valuable.
Opening comments
I spoke last year, much to the disappointment of the organizers of the Chicago Auto Show, on how nobody under 35 cares about cars anymore. They were happy to have me kick off the auto show! (laughter)
It had to do with this idea that we are more concerned today with the quality of our experiences than owning and controlling things. And we're also more concerned with the utility of things, than about possession. If there's a single thing that is most exciting in this whole world, then it is sharing.
If there's a single thing that is most exciting in this whole world, then it is sharing. - Howard Tullman
It's this idea that we'll use assets. We'll use things in ways that are efficient and will save an enormous amount of time and money, and become more economically responsible and ecologically responsible—all through this idea of the "sharing economy."
Two years ago I talked about hyper personalization, the idea of knowing everything about everybody, and that's sort of old news, sort of table stakes. And then the following year I talked about Facebook's launch of the interest graph and this idea that it wasn't enough to know about me, you have to know what I'm interested in, and it's a moving target.
So, interest, information, it empowers us. But now we are going to move to the next level, which is, where are you going? Not just what you're interested in, not just who you are, but where are you headed? That's the case, those are the stakes.
[For example] Google now does a better job of tracking real estate trends than the organizations in the real estate business. Google is more effective and more accurate in terms of the next 90 days of the market.
If you are "stuck in search," if you're looking for results, you're actually losing a step on the competition. So the idea of moving from diagnostics and analytics, to prognostics and projection, is where we are going. Those are the kinds of tools that we are going to see, and those are the tools that will put in our hands at exactly the right time the information that we really need and value.
Niches: The audiences you want to reach
Niches—they are not small, they are highly curated and very, very valuable, because they are authentic, if you do it right. The truth is that they are interactive and have enormous value, because they tend to be the audiences that you really want to reach.
Nobody wants to ship "tonnage" anymore. Everybody wants to ship to people that matter, to people that are engaged, to people that are going to consume and value your communications to them, and your products or services.
Speed is the state of competition
Speed, not size, wins today. Speed "kills," and speed is the most important thing. And you know the world that we are living in today, you can make dust, and be running ahead of people, or eat dust and sort of sit there.
[One example] is Safeway. Real-time pricing on an individual basis. Does Safeway give me the best price for my Charmin? No. Why? Because I love Charmin. So they give the best price to somebody who uses Kleenex, whom they want to incent to use Charmin. And they do this at a speed that is astonishing.
We're in a position now, where in the time that it takes (roughly 10 to 30 milliseconds) to load a webpage we can fashion and perform a personalized offer to the consumer, based on everything we know about you. So think about that kind of time frame. Think about this as the "shifting sands" underneath these kinds of conversations that are going on.
Another interesting thing that's happening is, if you haven't seen the Google PLAs (Product Listing Ads), basically, they've upped the ante. They have figured out that it is not enough to give you 22 million responses for an inquiry. So what they are doing now is feeding back a much more particularized set of information.
But when you hear people talking about "A/B testing," where the game is going because of high velocity computing, and because of the extent of the information we now have, think about "A to Z testing." - Howard Tullman
And this is really good news for us, as people seeking products. Now, having said that, the other thing is that Google [is making it] tough for small competitors, who don't have the tools and the engines to let you do this—to have your products be dynamically priced, imaged, supplied in real time to people searching. The little guys are going to get killed, unless we as entrepreneurs figure out ways to empower them with comparable tools, that is, compete with the big guys.
And so, from a consumer standpoint purchases are going to get better and faster and more particularized, but from a competitor's standpoint and from a product standpoint, it's going to get really tough.
What that has permitted is mass customization. And what I want to share with you about this is not that simple. But when you hear people talking about "A/B testing," where the game is going because of high velocity computing, and because of the extent of the information we now have, think about "A to Z testing."
And during the last (presidential) campaign, one of the great things was to sit next to Harper Reed and to watch him put up 20 different offers, and in a minute and a half kill about 16 of the 20 offers. They could see which dogs were eating the dog food.
So they would do these against tiny, tiny samples, across huge sets of variables, and then they would instantly react and go deeper and longer into the stuff that was working. But not after 12 weeks, or after three months of a print campaign—they were in real time, in minutes.
So again, speed is the state of the competition. Speed is how the game is going to be played.
Connected devices empower us
The idea that we are connected has more value now, not just due to devices, but also due towearables—devices that in every sense enable us, empower us in every kind of business sense and context.
We are all tethered. But not only are we tethered to devices that we think about, all of the devices around us are also becoming enabled and will communicate. This is the Internet of Things.
One of the new things at Disney, and this is really interesting, is MagicBand. Instead of a simple free app that would have committed your phone to do this, they sell you this bracelet that you take home, and it's useless as soon as you take it home. But on property, it opens your room, it pays for your goods, it identifies you, it moves you into the fast pass lanes. Very powerful.
And it's just one of many devices like this. Electronic leashes will keep us from losing our cars. This is cool (on screen): these are little tiny stickers you can put on anything that will GPS-enable and locate those kinds of things.
And my favorite is actually this—has anybody in the audience not moved? So if you've all moved, you all understand how that works. You give your precious possessions to a bunch of guys with no teeth, and you hope at the other end of the journey some of the stuff will be there. This is a fake little box (on screen) that you add to your moving load, and it sends GPS signals to you throughout the move so that you know that the guy isn't at some truck stop in Indiana for two days.
Video "everything": The default way we share
Where are we going on video? "Everything analog" is moving to "everything digital," and digital means video. That's how we learn, that's how we share, so more and more video. Basically, what you want and where you want it and when you want it, everything will be on-demand.
The truth is that for anybody under a certain age the first screen today is your mobile device. - Howard Tullman
We don't talk about television anymore, because we talk about video assets that are going to be distributed across all kinds of channels. And you know, interesting enough, TV is not suffering, but it is sort of selectively being depopulated. So in certain age groups, online viewing is exploding, and TV watching is diminishing significantly. The truth is that for anybody under a certain age the first screen today is your mobile device.
But we've discovered, and this is from the last Olympics—we expect to run this analysis again. We discovered the good news is these devices are completely additive. They don't diminish the TV experience, they enhance it. More and more of this is permitting us to do shorter and shorter communications. We see video-enabled communications as basically the default way that we share.
Again, [video is] how a great deal of learning will take place. The kids who are in school, who think of school increasingly as a sort of prison, they are doing their learning everywhere but school. So the whole world is going to adapt to this model as we move forward.
Collaborative commerce is powerful
Collaborative commerce... this idea that [if] we're sharing then we are going to be able to work together. When you go back not so many years, the personal computer permitted us for the first time individually to create powerful digital assets, and when the web came along it permitted us to share those digital assets. And then collaborative tools came along to let us work together worldwide. And lastly, after all that stuff was created, Google came along and let us find it, which turned out to be a fairly important thing as well.
[Collaborative commerce is] not taxable, or measurable. There are a lot of things that will come where people are going to have to figure out how this works.
But for now it's powerful… [for example] One Hour Translation or TaskRabbit. And look who these people are, look at who the 5,000 rabbits are on TaskRabbit. They are stay-at-home moms, they are retirees, they are college students.
It's a really powerful set of resources. It's way more powerful than something you could hire, than something you would want to hire. You want to use these as a variable cost. So you can push out just about anything. All of these are very, very powerful. You can hire an expert to help you raise money, just about anything. And that's just the beginning--we are going to see more and more of this.
Wiki work: Beyond constraints
We all know of Wikipedia. Wiki work is this idea that the workplace is everywhere today and it's so exciting because we are no longer time- and place-constrained, we are no longer location-based, we can be working anywhere in real time, and that's much more important than places tend to be.
We are going to be able to pull together an enormous talent of people: stay-at-home moms, PhDs, all kinds of people. [They] can join your team, join your workforce, in really amazing ways because of connectivity and because of the web.
And we are going to recapture opportunities while we are commuting, when we're stuck in places, all of these things are going to increase the productivity of the whole country in very, very powerful ways. If you don't understand how big Wikipedia now is—70,000 people work for free for Wikipedia these days.
And just to give you one example, I don't know if many of you know this. For about 10 years or more scientists were trying to solve a particular protein issue connected with AIDS and couldn't do it. And they pushed this problem out to about 200,000 gamers. They solved the problem in about 10 days, because they thought of it as a puzzle, they didn't know it was science. They said, oh wow, we just have to figure out how to do this.
More and more of us are going to work for ourselves, this trend is going to just expand and increase. That's exciting in some ways it's also lonely in some ways. And places that create community, like 1871, are really valuable. And we are going to have more and more services that are going to grow up and connect us to other services and connect us to other businesses, [and not through] traditional channels.