I am moving to New York

Seemingly no one is noticing Apple events from a “show” perspective. I do like the products but it’s the theater and storytelling part that has always fascinated me. I wrote about my frustrations earlier. I am happy to oblige, though, that iPad/Mac event was amazing. It might be because unlike Sep event, we hardly knew anything specific about any of the products. But I am pretty sure that’s not all there was. To begin with, Tim Cook’s body language was completely different. He was responding to an enthusiastic New York crowd exceptionally well. “I am moving to New York”, there is no way you can write and practice this line in advance. It was spontaneous and showed the stage awareness Apple crew has been significantly lacking, or ignoring, recently.

The fun way he introduced Mac mini was just gold. It did help that following video was one of the best I have seen recently.

I was granted more than one wishes though. Phill Schiller didn’t come out on stage to tell us about any of the new hardware products — which has been the case ever since Steve left. To top that all the people filling in for him were fantastic. Laura introduced MacBook Air. And I thought she was amazing. Tom introducing Mac mini somehow toppled her. And Jon just nailed the iPad intro. All of them showed a personality that went well beyond the products they were talking about. Phil Schiller doing the background vocals for iPad video was nice too. It felt refreshing. In many ways, it reminded me of Scott Forstall. While Jony always talks about the products from a physical design journey perspective. It was Scott who used to talk about the product from a customer perspective. And I miss him for that. Phil Schiller filled in well though.

So what changed this time? Frankly, I don’t know. And there is no way to know this kind of stuff. Part of this has to do with the New York crowd. In many ways, they were the lead actors here. Part of it has to be the products themselves. MacBook Air, Mac mini and iPad are the underdog products in Apple lineup. And people love to cheer for the underdogs.

Perhaps the biggest reason I assume was the absence of iPhone. iPad and Mac remain a footnote from a financial perspective. So Apple seems to be more playful while talking about them. And a lot more pressured while talking about the iPhone. A missed iPad launch will probably not hurt that much. But a missed iPhone launch could devastate the company internally. None the less I really liked the event. If separating the event from the bigger one in September is what it takes for Apple to bring back their showmanship than I am happy to watch two in two months.

Why Apple Events are Getting Boring

There has been a lot of talk about bits and atoms at Apple events lately. To a point where the storytelling is getting a hit. And it’s making me wonder since when Apple became known for its manufacturing prowess? I understand A12 bionic is for user benefits. But those benefits are clear only in hindsight. Apple is not focusing on those. It’s focusing on the chip itself. Apple devices have always been better. Even earlier Macs who got hammered in the market by Windows laptops were in many ways better standalone products. And yet that’s not what Apple was about. Or at least Steve Jobs didn’t envision it to be. Hence the first thing he did was not to introduce a new product on his return. He focused on a marketing campaign.

Think Different wasn’t about selling a product. It was a way to look at the world. And was intended for Apple more than anybody else. I am not sure if Apple is still using the same storytelling lens to communicate to itself and the world. To be clear, I get the pressure of the world’s most valued company. You have to keep the business running. And Apple events are the marque places to sell the products. But does it has to be that boring? The hallmark of today’s Apple events is their new better and faster chips. And the all so powerful camera systems. And not necessarily the story of a bunch of humans on a hero’s journey.

The irony is that Apple has already well-established brand around being the best. When you already have the trust you don’t hammer on why you are the best. Customers already believe in you. Yes, you need to reinforce that trust. But the way to do that is to tell stories customers can relate to. Stories about the intangibles and subtle aspects of the relationship. This becomes even more important as you get bigger and better. Apple used to be good at it. They are losing it now despite the fact that they are building the right products. But increasingly those products are being better explained by John Gruber, Ben Thompson or Marco Arment etc. And not necessarily by Apple itself.

With that said, I wasn’t sure of my own argument at first. The question I wanted to answer was: Is it me missing Steve or is there something wrong with Apple events now a day? If it’s the latter, which I was pretty sure of internally, then how to explain it. So I went on a tirade of watching Steve’s old presentations. I intentionally excluded presentations unveiling original iPod, iPhone or iPad because of the nature of unveils themselves. And I am not going to critique the Apple Watch presentation either because we know original Apple Watch was a botched product let alone the story behind its unveil. Though Ben Thompson still managed to tell a better story for the same botched product.

So here we go. Below are the three main reasons I think Apple events are getting boring.

1. Apple’s increasing reliance on videos to launch new products. Videos are ok if you haven’t seen the product and downright boring if you have – which has been the case for the past couple of years. More importantly, they do nothing to connect the human on stage with the product he/she is talking about. Let alone connecting the audience in attendance or at home with the product. They make the audience do that part themselves. And before they are done with it Tim Cook comes back up again expecting a gasping reaction. Which quite frankly isn’t there. The cheers are mostly either because the video was nicely done or a product looked so sexy. There is no anticipation of what the person on stage is about to say or do next.

2. Apple turning blindsides on audience’s knowledge of the event. As an example, iPhone images got leaked this year. And yet Apple didn’t bother to tweak its presentation to acknowledge the fact. It felt like they are living in a different universe. While I get that’s part of the allure to not talk about what everyone else is talking about. But not even acknowledging it disconnects you from the audience. Remember Steve Jobs saying “stop me if you have already seen this” while introducing iPhone 4. That one sentence of acknowledgment made the audience realize that there is a human on stage just like them. More importantly, it made them pay more attention to what he has to say next. You have to address the elephant in the room if you want the focus to be on something else.

3. Apple disowning their old products in fear of making their new ones look bad. Old paving the way for new is the name of the game. But when you don’t appreciate or acknowledge what you told us last year, we are less likely to believe what you are telling us now. It’s a simple case of being honest. I am not saying old products need to be resold again at an event promised to show us something new. But you have to take the user journey while introducing the new. And a user’s journey starts with what they already have. When you don’t tell the vulnerable part of how you reached a new product from the previous one the new product, or the not so new, often comes as an insult to the customer’s intelligence. Again, you don’t have to go on a tirade explaining every little decision you made during the course of one year. But you have to find a way to communicate the fallible yet human side of the products.

Bonus: Zero surprise element. It’s hard to surprise people when they already know what you have or expecting you to have. Apple presenting iPhone X as “one more thing” last year is a good example. iPhone X was everything but a surprise. Everyone knew it’s coming. The magic behind “one more thing” wasn’t a grandiose product. It’s the element of surprise. This becomes even more important when your marque products are already leaked. I would have loved to see a live demo of ECG in action as one more thing this year. Or taking a picture from new iPhones on stage – the sort of which Gruber did for his review.

Speaking of Gruber, he wrote an excellent review of the new iPhones. It’s 10x better than what Apple had to say about them. It feels honest. In his review, he explained in detail why both iPhone Xs and Xs Max have remarkably better cameras compared to iPhone X. This is a story that we didn’t get from the Apple event. But we should have. Gruber actually defended Apple by saying that the reason they didn’t show side by side pictures from both the old and new iPhones was they didn’t want the otherwise excellent camera system of iPhone X to look bad. Well, that’s exactly the part necessary to tell a good story. You have to be vulnerable.

The reveal of iPhone 4 gives us hints on how Apple used to do this stuff. First, as I quoted above Steve was quick to admit that there have been leaked photos of what he was about to show you. And then followed it up with “believe me you haven’t seen it”. And that felt true because you might have seen the product you don’t know the story he was about to tell you. At 4:01 min mark he explains the publicly criticized (from leaked images) antenna lines. Fast forward it to 9:20 min mark and you see him making a comparison of iPhone 4 and 3GS’s screens. iPhone 4 was the first iPhone with Retina display. The difference between the two screens was miles and yet it didn’t prohibit him from showing that on stage. And somehow it didn’t make 3GS look any less of an iPhone. Add to that, iPhone 4 demo actually failed. And he turned it into the most exciting part of the entire event.

You can say not everyone is Steve Jobs who can turn a failed demo into a show. And that’s true. But it’s no excuse to not be vulnerable and human on stage. The real magic behind Steve’s presentations was he used to show a lot of vulnerability. He used to mock himself and the very product he was about to unveil just to build that connection. He wasn’t afraid because he was convicted of the product itself. Phil Schiller and Tim Cook, on the other hand, are presumably lacking the same level of conviction. I have never seen anyone from Apple raising his voice so much as Tim Cook did this year just to make his point. And that more than anything else is a warning sign.

Good thing for Apple is that their products are far better than anything else in the market. More importantly, though Apple might not be telling it, they do tell a story. It used to be that Apple had the perfect story around its products. And for next week or so I will avoid reading anything else. I feared press will say something that could possibly dent the perfect story in my head. I would go on finding ways to protect that image. It’s completely opposite now. Apple’s articulation of their products is falling short. It’s stomped and fixed on What with zero explanation of Why. As result, their events are leaving me lost and confused. Either I have to force myself into buying a product to feel it. Or wait for John Gruber to tell me about it.

Why PTI’s Tech Manifesto is a great news

I was hardly 10 years old when my father and I started to discuss (read argue) politics and cricket, two things constituting most of dinner table discussions in our country. My father was a strong PPP and Benazir loyalist. And he believed Imran Khan to be the greatest cricketer who ever lived. I, on the other hand, always supported PML-N because Nawaz Sharif, I thought, was kind of cute. And there was never a doubt in my mind that Wasim Akram is a far better player.

My father used to say that my preferences will change when I am 30. He never lived to see his prediction come true. But yes now I believe Benazir was perhaps the greatest political leader of our country. Not because of any specific accomplishment of her. But because of who she was and what she represented. And I strongly believe now if there ever is an all-time World XI of cricket, Imran Khan has to be the captain of that team. Else the selection process is flawed. As a political leader, however, I never completely wrapped my head around him. First, I thought he is too good and straightforward for our system. Now, for the most part, I don’t recognize him. That has been a troubling thought for past couple of months because of looming general elections.

I only voted once in my life and that’s in 2013. It was an emotional decision. I loved Imran Khan for his past and didn’t care about anything else. That needed to change this time. Opening myself for a discussion to vote for someone else was deeply upsetting. In hindsight, however, it’s illuminating. Although I ended up choosing PTI again the reasons are totally different. My choice has nothing to do with Imran Khan as a person. And has everything to do with PTI’s manifesto especially tech manifesto. PPP, a party I desperately wanted to vote for mainly because of my slightly tilted left alignment, has done the worst job. PML-N did better but still, their manifesto is all over the place. There isn’t a single coherent theme which makes it hard to hold them accountable for anything.

If this seems like another Facebook post where all of us are justifying our political affiliations now a day. Then yes it was meant to be. But not because of the reason you might think to believe. As mentioned earlier I actively supported PML-N while my father was an active PPP supporter. From an early age, I believed it to be a personal decision and that everyone should make their own. However, it was important to set the context right for this article. The praise for PTI below is not because I am voting for the party and trying to advocate that here. But because I honestly believe that their team has done a wonderful job in articulating the problems of the tech sector and how they are planning to solve them.

If anything I want to advocate a rational decision making. You don’t have to agree with me. But read the manifestos of each party and then decide which side you are on. It’s high time for us to leave behind identity politics and our sentimental affiliations with celebrity individuals. Let’s get to the topic.

The Knowledge Economy Vision

What makes an iPhone an iPhone is not the individual bits and pieces but rather the whole package. I can count at least ten smartphones on my hand that has a better processor, have more memory or a first to adopt a certain new technology. But not one of them is actually a better phone than an iPhone. At least not in terms of adoption and ease of use—metrics that actually matter. Similarly, if you go by the regular media coverage there isn’t much difference between the tech manifestos of each party (Asra still managed to articulate the differences here). Same easy of tax regulations and making it a pillar in GDP etc. What differentiates PTI from the rest is that they are much more cohesive. And I was pleasantly surprised to see that they started with a vision.

Transform Pakistan into a knowledge economy making IT the top contributor to Pakistan’s exports and job creation.

For once you have to appreciate the use of the right words here. To me, this seems like another way of saying that software is eating the world. And we need to get on the boat. You might think I am reading too much into it. But I am not. The point is reiterated throughout the manifesto. From the executive summary (emphasis mine):

The IT/ITeS industry provides the best Return on Investment (ROI) for investment that will stay relevant for foreseeable future. While agriculture and traditional industries will become more automated requiring less human resource to deliver more productivity, IT industry can keep on providing high-end jobs for the future. Hence IT/ITeS holds a central position in economic policies of PTI government.

I don’t remember the last time someone from the government so aptly put why tech matters so much. Agriculture and traditional industries are low yields especially in regards to human effort. So they can benefit a lot from automation. Tech industry, on the other hand, has the best yields as of now. More human ingenuity is required because much of the economic value from tech is driven by trying something new and different. The same is not true for agriculture and traditional industries where processes are relatively streamlined. A good analogy to understand this is to look at how companies are run. If you want to maintain what you already have, you tend to protect the bottom line. But if you want to grow you must focus on the top line.

Now, what’s about having a vision statement? Anyone can write one. Yup, but the statement will become meaningless if you don’t follow it up. PTI’s tech manifesto starts with a vision and everything that follows actually traces back to it. If nothing else it serves two purposes. One it simplifies things for PTI itself. They are clear from the get-go on what to do and what not to do. Second, it’s something that you can agree or disagree to. Going through other parties’ manifestos makes you feel alienated. Everything seems good on the surface. But you don’t feel agreeing or disagreeing to anything. That’s because you don’t understand what it means for you as an investor, entrepreneur, IT professional or freelancer. Everything is too generic.

Tech hubs around the world are echoing this for a long time now. More software enabled industries are central to a country’s growth. I think PTI is agreeing to it. I am not saying other parties especially PML-N don’t. But they never stated this so explicitly. This short distance of translating a dream (in your head) into a vision (on paper) is critical in the sense that it turns the focus from “what” to “how”. When you haven’t stated the “what” part. You can’t really be expected to state the “how”. The end result is half-hearted attempts we are accustomed to expect from governments.

The how part does, however, has a lot of vagueness in it. But that’s expected. Even inside a startup, it’s hard to nail down the exact steps in advance. But startups are nimble in a way governments can’t be. Yes. The good part here again is that PTI seems to be aware of the (emphasize mine again).

Under leadership of PM of Pakistan, an office of Knowledge Economy Authority (KECA) with cross-sectional powers across the government departments will be established as a statutory authority. The authority will be headed by CIO, who will provide the expert leadership and will be from private sector. This is to ensure that the authority works with a more agile mindset compared to existing government bureaucracy.


Two things become clear as you read the document. 1) Syed Ahmad and his team are PTI supporters but not necessarily PML-N haters and 2) they have learned a lot from the previous government’s mistakes. The document actually begins with something aptly titled as “The Digital Dream and Bitter Reality”. There is a fair bit of critique on the previous government. But it’s good. One it’s not an attack on any one person but rather on what’s missing behind those seemingly good initiatives. Second and this might be personal, issues highlighted are ones that I often talk about while writing about startups. Some notable excerpts from this section:

In absence of sponsorship and direction from highest
 level, each department at federal and
provincial level created its own digital
strategy competing with each other to
have maximum share of resources, 
budgets and control. These departments including NADRA, PRAL, MoIT, PITB amongst others also competed with the IT industry whereas leading governments around the world (Singapore, India etc.) have worked in close partnership with the IT industry to help them develop capabilities and eventually compete at global level.

Instead of creating holistic and long-term strategy to solve the core issues facing the IT industry the government departments focused on redundant projects with limited and short-term impact such as startup incubators and internships/short-training programs.

These two paragraphs summarize two core strategies that align perfectly with the vision stated above. One, every little initiative by the government should trace back to the vision. No more department level ad-hoc projects. Second, the role of the government is to be an enabler. Owning every initiative won’t help the tech sector. It’s the private sector that needs to shine up. Governments should provide an environment where the private sector can run places like startup incubators and VC funds. It should have no business in running these places. And that makes a lot of sense. If incubators/VC firms need to be successful they need to have a business model and not just another altruism stint. And if something has a business model then it should not be part of the government because of conflict of interest.


In absence of job opportunities in formal sector, an oversized number of workforce joined freelancing platforms facing its own set of problems. Startups have also been exposed to very difficult business environment in Pakistan in which generating revenues or sustainability has been impossible beyond incubation stage.

I don’t think you need to be a PTI supporter to say yes to any of them both. Freelancers are not treated like office going employees. Not even by the banks which is stupid because freelancers can bring more business than an average 9-5 employee. And a challenge most startups face is the hostile business environment. This is especially true when you had to compete/deal with big corps like telecom or banking sector. Even more so if you are currently not sitting in some government-backed incubator e.g. Plan9 or NICs. Which ties back nicely to the aforementioned point.

The third and final core theme prevalent in the document is of public-private partnership. Instead of either backing few particular private sector companies or directly competing with all of them, the public sector should be the first customer of private businesses. From the document:

In absence of adequate market access, government could support IT industry as the largest buyer of IT services hence building capacity and experience necessary to compete globally. Instead of supporting the industry, government departments competed against the industry to execute most of the e- government projects themselves. This resulted in weakening of the delivery capabilities of local technology firms on global stage. This is evident from the fact that there is not a single largescale IT firm in Pakistan with 5000+ employees compared to India and Philippines which have hundreds of them.

I especially liked this excerpt below:

This will allow experimentation on trying to create new business models in PPP [public-private partnerships]. e.g. How Metro bus stations could partner with bike-sharing startup to increase adoption and provide critical mass. Or Islamabad Police could incubate video analytics startups to identify potential crimes. These provide essential real-life data to train expert resources and help solve local problems.

While tidbits like tax exempts are important (PTI has them put in the doc too) they become irrelevant pretty soon. What’s the use of tax exemption if you don’t have an environment where a startup can compete fairly without cajoling the stakeholders of the tech ecosystem? At a very basic level, this is what PTI is promising with their manifesto i.e. a level playing field. That’s pretty exciting if you ask me.

Tech is not the hard part, Adoption is

A recent report suggested that 56M people are using 3G/4G in Pakistan. While that’s a great news in itself. The usage is mostly for entertainment purposes. Internet as a mean of utility and value creation is still limited. That’s a challenge for a startup whose business model is predicated on the Internet. One way the government could help is to force the adoption. While it will be painful in the beginning (e.g. India’s demonetization of notes in 2016) it paves the way for future innovation. Aiming to transform Pakistan into a Knowledge economy is a step in the right direction (there is a mention of paying pensions via mobile wallets if you are curious).

In more ways then one, it’s also a departure from what we have always been told i.e. we are an agriculture economy. Obviously, we are not because our agriculture is going nowhere as well. But it was a mindset hold. A kind of mental prison in Kanye West’s words. Do we need to get better at agriculture? Sure. Should our textile and sports goods industries need to be incentivized for more production? Yes. But they can’t grow any further unless they are enabled and incentivized to operate in the Internet economy. I can’t even imagine thinking about how many small businesses can flourish if the government can solve the fundamental challenge of meaningful Internet adoption in the country.

It will be easier said than done though. At a fundamental level, this is a question of changing mindsets. And it’s there where I think having a vision and enforcement from the top across industries is important. An ad-hoc project to automate one particular department might be good work on the surface. And it might even help that department too. But it won’t change people’s habits in general. It will always be an exception to the rule of keeping things as they are. Unless these people meet with their friends and they talk about the same thing happening at their place. That’s how people adopt new things.

Why OLX’s Investment in FCG Spells Trouble for PakWheels

Olx group is investing $89M in Frontier Car Group (FCG), the parent company behind CarFirst. From TechJuice:

OLX Group announced $89 million global investment in the series C funding round of online car marketplace, Frontier Car Group, the parent company of CarFirst. Headquartered in Berlin, the startup is currently operating in six countries.

A joint press conference took place yesterday where OLX announced this investment in the parent company of Pakistan’s first online used car selling platform — CarFirst. This record investment aims to deliver the most comprehensive experience to auto buyers and sellers in the country.

FCG has operations in at least five other markets so not all of the money is going into CarFirst—a significant portion will though. But before we discuss CarFirst I would like to mention how smart this move from OLX is. Facebook and Google are accumulating most of the online ad revenues leaving very little on the edges. Although you can still run a decent business purely on ads, opportunities for long-term growth are always going to be limited. As soon as you start to get meatier you are going to hit the gravity center. And that means colliding with either Facebook or Google.

The antidote is to stay away from the gravity centre as much as possible. And that often means building a differentiated product. Or in this particular case investing in one. The investment makes more sense if you consider the fact that OLX was already in ad business. Which means 1) they were not in the best position to build a vertical integrated product themselves and 2) a company like CarFirst can benefit a lot from their audience. More exciting part of the news, however, is what CarFirst is trying to build. I wrote about the company in passing, when it launched while writing about PakWheels last year. From the article:

Kudos for trying something different but there are more questions than answers here. First, it’s not clear who the strategic partners are and how they are incentivized to stay with CarFirst. Second, this requires a lot of capital and even if you have enough to start things off it’s questionable how long you can sustain it. Cars are expensive. Also, I don’t understand why you want to limit yourself to your partners when you have already done the heavy lifting i.e. buying the car outright. And perhaps most importantly I am yet to understand the business model.

I am less skeptical now than I was a year ago. For one those $89M solve the second problem I sighted. Second, they have matured in their positioning and are not relying on their “strategic partners” narrative as much. That’s probably because they are more sure about what they are doing now than they were a year ago. The business model question is also clear to me now. Although there is no information on their website on what they do with the cars they buy. But it’s clear that provided the operational scale, which seems like they have or going to have sooner, they can buy a used car, fix/renovate it and sell it at a higher price.

It’s an audacious business model with a very high-risk profile. But the upside is equally big. I concluded my article on PakWheels:

So how you compete with PakWheels? You don’t. I mean you can but you will fail if you start from the obvious i.e. a car listing website. You can however if you start with things that are not obvious. Like studying a typical PakWheels’ user. Finding the pain points they have? And figuring out a couple of problems they face while using PakWheels. Every horizontal business model creates an opportunity for a vertical one and vice versa. The way to compete with PakWheels is thus by targeting a niche and owning that particular mindset. Not by creating another listing website.

Two types of people visit PakWheels. People who need to buy a car and people who need to sell one. The vulnerable of the two is the seller. Any buyer has a lot of options to chose from. The seller, however, is stuck with whatever she has. It was always going to be hard for CarFirst to convince buyers to go through them. Because, well why should they? They have lots of other options to shop around. Money is liquid in a way that a car is not. It’s only right that CarFirst is targeting the seller. And provided you create enough happy seller stories, buyers are going to flock in too. At some point in time shopping gets exhaustive.

The very idea behind PakWheels’ existence is predicated on the fragmentation of the market. There was no reliable way to sell your used car online. While PakWheels connects buyers with sellers, the business model relies on for both parties to keep looking. And not necessarily on getting a car sold. Or finding the perfect car. PakWheels was easing out your search. CarFirst is solving your entire problem. The latter is always more lucrative provided you get it right.

Fabricare is not Uber for Laundry, and that’s a good thing

From Pro Pakistani:

FabriCare, an app which aims to revolutionize the laundry industry to make it more convenient, affordable and efficient, has raised $100,000 in a seed investment round against a 16% equity stake.

The investment was shared among all three judges of the show, Idea Croron Ka.

Their pitch from the show suggests that they are Uber for laundry. I don’t think they are. Describing a typical lifecycle of their customer Fahad, the CEO, said (paraphrased): when a customer needs laundry she can request it via their app. Someone from Fabricare picks up the clothes, gets them cleaned and ironed and returns them back within 24 hours. This is not an Uber model. Uber does not cover the last mile itself. They let the drivers do that. For Fabricare to be Uber for laundry, the laundrymen, which Fahad referred to as partners, will have to pick the laundry themselves.

While this might seem trivial, it’s an important difference.

Uber, or any company calling themselves Uber for X, is a two-sided marketplace. They connect drivers with riders. They own the customer relationship but not necessarily the parties involved on either side of the relationship. They let the market forces i.e. their rating system govern the business. As an extension, their business model is to take a cut on the transaction. The major chunk of the transaction still goes to the driver. Fabricare, on the other hand, is owning the supply side. They are not exposing their “partners” to the customers. Which means they are a service provider and not necessarily a two-sided marketplace.

Both, providing a service and being a two-sided marketplace, have pluses and minuses. But you have to know where you are to exploit the inherent advantages. As an example, both Uber and Lyft have been trying to make subscription model work. The problem is subscription means a guaranteed availability of the service, something that requires a one-one relationship between the customer and service provider. A two-sided marketplace like Uber thrives on breaking that relationship let alone enabling it. A customer using Uber does not have a one-one relationship with one particular driver.

If I call Uber, drop it and then immediately call again the chances are I am going to get two different drivers. While that’s fine when I am traveling on my own schedule. It’s not ideal for my bound needs e.g. school pick and drop for my kid. For one, I, as a customer, would be freaking out on the prospect of having to deal with a new driver on daily basis. Second, the incentives don’t match up for the individual driver. Why would she go to pick a customer who has already paid a fixed amount of the trip, the incurring cost of which is unknown? This is especially true in peak hours. The same peak hours when the guaranteed service inherited in the subscription model is required the most.

On the other hand, a rental car service provider, by virtue of owning the supply side, can offer a subscription service with ease. They can easily allocate a driver to pick and drop someone from location A to B on daily basis. The customer would be happy too because she knows what to expect? Fabricare is more of a rental car service than Uber. While that’s not sexy it’s by no means any less of a business model. Maybe they can just call themselves Stripe for laundry or something.

Joke aside, it’s important to understand these intricate details of your business. The number one problem with laundry is that it requires a certain level of trust and care. You want your clothes to be treated in a certain way. And you don’t want to tell this to every new person that comes at your door. Second, laundry is a recurring predictable task. The Job-to-be-Done here is less about the task itself but rather in the satisfaction that it will be taken care of. Both are perfectly suited for a subscription service. Fabricare is getting the first part right. But conflating themselves with Uber is resulting in them having a blind spot about the second. And that’s limiting their actual potential.

Demystifying Growth

I didn’t have much to talk about this week. Or the last week. Which is a nice little excuse, to write about a topic that’s at best fascinating and at worst scary.

I came across this tweet storm from Andrew Chen this week. It encapsulates everything that’s wrong about growth hacking. Or the perceived notion of it.

Do read the thread. In short SEO, Newsletters, Facebook Ads etc are not growth hacking. They are well known and established online marketing channels. Growth Hacking is exactly opposite to what’s already established.

The promise of growth hacking is that you figure out a way to grow your business from an unexpected place. It’s about cracking a new distribution channel. The whole idea is predicated on novelty. If you already know something it’s probably not growth hacking. Some examples of growth hacking include Instagram using Facebook sign in, Airbnb hacking Craigslist API to put their home listings and Trump using blunt tweets to become free world’s most powerful man. The last one is a jab but not totally. It’s a still a hack. A hack no one saw coming.

The whole process is also product dependent. Twitter or Google sign-in was probably not a good fit for Instagram. Facebook might not have been the perfect platform to think of if you want to organically find people looking to rent an apartment. And Trump posting nasty images on Instagram were less likely to work. Sure Instagram might have used Twitter for something later on. Airbnb definitely uses Facebook Ads. And Trump might have an Instagram account. But that’s not how they hacked their growth. If it has already been worked out it’s no longer a hack. What Sean Ellis and Andrew Chen prophesied was a mindset. And not a proven set of tips and tricks.

I am not saying you should not look what has already been done. Just don’t try to copy it. For the most part, it won’t work. And that’s where most of the frustrations with online marketing aka content marketing are coming from.

Growth > Growth Hacking

Good news is growth hacking is not the only way. Actually, it’s not even a good long-term strategy. It’s a great way to gain initial traction. But that traction needs to be captured and sustained. And then built upon. For that, you need to focus on growth and not necessarily growth hacking. And growth, as Andrew Chen argues in the tweet storm, is more of a system then a hack. It involves teams from every part of the company rather than a couple of growth hackers sitting in a corner. And thinking of next magic trick.

In simple terms, growth means increasing your customers or revenue per customer. But it’s not so easy. Especially for startups who are in “growth” phase and not necessarily making any money. What that often means is that they are increasing the pool of potential customers before experimenting with any monetization strategy. This is especially true for advertising businesses. Advertising works best at scale, hence the Google/Facebook duopoly. Things are a bit simpler when you have customers paying you directly. In that case, it’s mostly about how many customers you have multiplied by the lifetime value of your average customer.

Growth used to be a product distribution challenge. More efficient your distribution the more opportunities for growth you had. For most online businesses, though, product distribution is a solved problem. By virtue of being on the Internet, you are everywhere. This does not make any easy to grow your business. The leverage you have because of the Internet is also available to your competitors. Hence the most challenging aspect of an online business is not to start one but growing one. This is after once 1) you have something valuable to offer and 2) you know there is a market for what you are offering.

There is a quote in traditional marketing i.e. half of your marketing efforts always fail. The problem is to figure out which half. Radio, newspapers, and TV offered no quantifiable ways to judge your marketing efforts. Most of your work was to be effective at guessing. Things are slightly different on the Internet. You can have a better idea of what’s not working. The problem however remains is to figure out why they are not working. Was it the wrong platform? Wrong target audience? Or is it something wrong with the product itself. This last one is a particularly brutal discovery to come to. It takes you back to the drawing board and is normally a reset button.

You can’t separate growth from your product. It has to be a part of the product development process. Focusing on the design and engineering is easy in the sense that things are in your control albeit hardware products. But unless market analysis and how your product will reach the people its supposed to reach is not part of the discussion, you are not exactly building a product. The good news is marketing online is not a Wild West as it once was. This essay from Andrew Chen will give you a useful framework to wrap your head around it.

#PITBLeaks and Our Tech Oblivion

Both TechJuice and Pro Pakistani reported a PITB data breach. I urge you to read both stories especially the one on TechJuice. It’s comprehensive and very well written. And pretty damning too. There is a lot to unpack. I will do it quote by quote. From TechJuice:

Sensitive information of millions of Pakistani citizens may have been compromised in what can be dubbed as the biggest data breach of Pakistan.

In August last year, ProPakistani reported that Punjab Information Technology Board (PITB) has exposed sensitive data of thousands of individuals that comprised of CNICs and scanned copies of personal documents. According to PITB, a bug that attributed to this exposition was taken care of, however, no comments were made on the possession of leaked data.

Nine months later, PITB is yet again in deep waters after it was revealed that sensitive information acquired through various PITB portals is now being sold publicly. This information comprises of personal and family data held by NADRA, criminal records tracked by the Police and call data recorded by telecom companies.

First, a little context. I sometimes feel everything that happens in Silicon Valley starts to happen elsewhere as well. It probably has to do with the similarities between how software systems are built and, pertinently here, potential security loopholes inside them. But past couple of years have been tough for companies operating on massive amounts of data. Even Silicon Valley (the show) threw a jab on them in its latest episode. So it’s natural that data breaches and misconducts have started to happen elsewhere as well.

How did this happen?

From TechJuice again:

The breach traces back to when PITB gained access to NADRA’s server after it was allowed to digitize the data of citizens by linking CNIC numbers to various public departments. This data could only be accessed through authorized users, however, it is now being alleged that these officials shared their credentials which were used for extraction and trading of sensitive information of Pakistani citizens.

More specifically it was AgriLoan, an application built by PITB, that’s to blame. From the article again:

PITB has developed various portals for digitizing diverse sectors. One such portal is AgriLoan that was developed to boost the agriculture sector of Pakistan. The portal service provides loans to small farmers through a convenient process in which all of the data is automated and can be accessed easily just by entering the CNIC of a registered farmer. PITB’s website states that all “stakeholders can access the database of over 350,000 registered farmers”. However, with reports of the recent data breach, it is evident that various unauthorized personnel also gained access to this database.

Upon research, TechJuice discovered that login credentials for Lahore and Sargodha districts were publicly shared for free. The username and password for the authorized access also appeared to be identical, indicating a huge security lapse. They also posted a step by step guide to help other users extract information from the portal.

The AgriLoan login panel was accessible till yesterday, however, the link is not working today. A tutorial on YouTube also explains how to extract CNIC data from the AgriLoan portal. The tutorial uses the same credentials for the Lahore district as revealed by the Facebook user above.

Leave the above Silicon Valley context aside. Because this is not a breach or an attack. It’s gross incompetence. Perhaps the most sensitive information in the country is protected by “lahore_district” and “lahore_district” username/password. NADRA pinned the blame on PITB. Because why not. And oh, they did one more thing. They gave PITB a timeline to fix this. Yes, a timeline. They didn’t revoke the access immediately. They gave a timeline.

Response from PITB

Perhaps the most perplexing thing, at least to me, in all this was the response from PITB. To be specific from Umar Saif. First, he told Pro Pakistani (via TechJuice):

The same media outlet also reached out to Dr. Umar Saif, who said that they are actively revoking the access of their portals and applications, while also launching inquiries and action against alleged personnel. He said that all instances have been resolved and they are actively blocking any breach of authorization. However, he did not comment on the absence of security protocols that were not deployed by PITB in the apps and portals under question.

Seems like a statement that I would expect from him. Fixing what he realized is broken and silent about things he is not completely sure of. You can’t blame him if someone from his large team chooses a stupid username/password like that. So what you do? You don’t say anything but you understand what you need to do. It’s not my fault but I share the responsibility. All good. But then he started tweeting. First these two:

For one these are not the statements of a person who knows what he is doing. And second, when you are being accused of something you don’t respond with a threat. At least not until you have clarified what has happened (from what’s on TechJuice you can’t assume nothing has happened), how are you planning to deal with it and finally distinguish the smoke from the fire. And let the public be the judge of the whole situation.

He ended with this.

Much calmer, but it’s still a statement of denial. Let’s assume it was just smoke. Wouldn’t be wise to address the smoke rather than denying it? But there is no explanation which creates more room for “fake news”. Instead, the message is toned towards media reporters. Which the man of his stature should not be worrying about. Especially when nothing has happened—according to him. But I might just happen to have an explanation for this.

Tech Oblivion

Years ago I wrote a critical piece on a startup at an early growth stage. The founder, who is now an acquittance, sent me an angry email. Not because what I said was wrong (in hindsight the article was a bit off). But questioning my right to say it. In his mind, he was changing Pakistan. And my article hurt his and company’s reputation. In my mind, I was trying to do my job and possibly helping him. It just happened that I disagreed on some of the product decisions he was making. And wrote about them on a publication meant for such articles. You would think we have come a long way.

Unfortunately, the situation hasn’t changed much. Most founders still focus too much on themselves. And not so much on the product, the business model or the customer experience. The people in the ecosystem are not helping because they are treating the founders like angels. You are not supposed to speak against them. Yes, what they are doing probably does not make sense, and sometimes even gross, but it’s alright because they are being bold. And courageous, something news reporters and writers are not—for some reason.

It’s a mentality that has taken us nowhere. And we are still wondering if there ever going to be a unicorn? And will we ever be able to break through? On the same grounds digitizing government is a great step forward. But it’s just that. A great step forward. Or maybe a GREAT step forward. But it’s not noble in entirety. There are always going to be consequences. Naturally, some of them are going to be bad. And it’s under-appreciation of those that lead to tweets like these. Yes, I am more concerned about the tweets than the data breach. Because I am certain Umar Saif and his team can, if not already, fix the latter.

Patari’s Inflection Point

Khalid Bajwa was involved in sexual harassment cases brought public by a couple of women via Twitter last week. I wrote how I felt personally about the issue on Thursday. A few of you replied back and suggested that his actions are best classified as flirting. And not necessarily harassing. And that WhatsApp screenshots, which can be cropped to make your case better, does not prove anything. While that’s definitely true. I don’t think what he was trying to do was flirting. Flirting does not make the other person uncomfortable even if he/she started it. Clearly, that wasn’t the case here. Women involved were uncomfortable. They were trying to avoid the discussion Bajwa was forcing them into.

I didn’t say anything about what this means for Patari. For one I was already done writing for the week. And I was late so didn’t want to delay any further. Plus, the news was fresh. I normally take some time to form my opinions. And perhaps most importantly I was angry. Not a good emotion to have when you are trying to write something. Patari is probably the best thing to come out of Pakistan’s tech ecosystem in recent years. They built a great product and there is a vibe to its existence that made me optimistic about its long-term future. And no matter what you think of Bajwa after these cases, whatever Patari is today, it’s a representation of him in many ways. That’s not to defend him. Rather point out how insincere and dreadful his actions were.

When you had created something so amazing, you owe a certain responsibility to it. A responsibility not to mess it up unintentionally. And Bajwa showed utter carelessness to the trust that people bestowed upon him by helping Patari become what it is today. That includes Patari’s user base, artists and most importantly people working inside the company. I wrote in Patari’s bull case why I am optimistic about company’s long-term future:

Last week’s update made me think about Patari’s long-term future. I was bullish on their success last year when I wrote Tabeer, Fanoos and Patari’s Opportunity. But after understanding the challenges they are up against I started to question my assumptions. If record labels are so well positioned than how they are going to make it? I think I will stick to my guns for now. I believe Patari can change the incentives game around. There are a few things, albeit abstract, that are in their favor especially on a 2-3 year time horizon:

1. They have solid traction and are connected to their community (artists + listeners) in a way that most startups from our country are not.

2. They don’t have serious competition in sight. I don’t know of any music streaming service that is challenging them in a meaningful way. Though there are no substantial early mover advantages in music streaming business. The window they have right now is nothing but gold to build a great customer experience and create some kind of lock-in.

3. If anything Internet is going to be more pervasive in coming years. And Patari is all record labels have to reach this new target audience. A scary proposition for any content producer. Despite the incentives being hugely in their favor right now, record labels are too dumb to understand this. And too lazy to build or help build an alternate.

What Patari has is nothing substantial as of now. At least not in financial terms. What it had was the trust. A belief that it’s doing something amazing. And in the process is helping revive the music industry of Pakistan. Nothing hurt that trust more than reports from last week. You lost your community’s sentiments. And in a way that’s all you had. With that said I don’t think all is lost. Kudos to the board and rest of the team for stepping in quickly. As you probably know Bajwa is out. And Ahmed Naqvi is now the interim CEO. They did the right thing. But a lot more needs to be done. Those twitter jokes will be weird for now. And it will be a hard time for the team to change and instill new spirit into the company’s culture.

But it might just be what the young startup needs right now.

Why Alibaba buying Daraz is good news?

A brief follow up from last week. Reliance JioMusic—Saavn deal is not what I understood. First, Saavn will keep its brand identity. It might be something along the lines of Jio-Saavn but the name will live on. And the founders will continue to lead it. Second, and perhaps more importantly, Saavn will not be an over top the service for Reliance only as I thought it would be. Rather it will be available to everyone just like before.

This paywalled article from The Ken has more details.

Why Alibaba buying Daraz is good news?

I don’t have any insights on whether this is actually going to happen or not. It does make a lot of sense though. Regardless, I think Alibaba’s potential entry is a fascinating news. I concluded in eCommerce Impediments:

I do believe that this is more than $1B industry. But ecommerce players will have to change their approach if we want to be there rather quickly. Or maybe Jack Ma can do something about it.

The Jack Ma reference was part sarcastic and part optimistic. There is only one way for startups to operate in any market eCommerce included and i.e. by targeting a small niche and owning it. That rarely happens though. The allure of ease with which you can start a business on the Internet deludes the fact how difficult it is to actually run one. So startups rush towards expanding their offerings. And end up taking a bite their mouths can’t swallow. And that’s precisely what’s happening with eCommerce players in Pakistan. I laid out the challenges in broader strokes in the aforelinked article.

Keep that in mind and the fact that we are already a huge market for Chinese products. It makes a lot of sense for Alibaba to venture into Pakistan. A population of about 200M is alluring, to say the least. There might be a political angle as well. The recent Pak-China Economic Corridor is certainly encouraging for Jack Ma’s team. And if one thing you can be sure of any Chinese company is that they play well with their government. That’s almost required by law. Xi Jinping will certainly be more welcoming to Pakistan than say India which he sees more of a rival than a friend.

I mentioned 200M people of Pakistan. I don’t assume all of them will be Alibaba’s customers. At least not immediately. But they might be. I will go on and say that Alibaba is the only player who can further expand the market. Current eCommerce players have spread themselves too thin in the most concentrated parts of the country. And now they have little or nothing left to expand into new cities. Yes, by virtue of being on the Internet they are everywhere, to begin with. But further you are from the main cities more bottlenecked their distribution is. And then there is all so big challenge of online payments.

Alibaba can solve both these problems in one stroke. I am particularly excited about AliPay. In other words, Alibaba can open up the market. And that’s precisely what eCommerce in Pakistan needs right now. From Tacking Uber.

Secondly, in Pakistan, distribution is still a thing. Actually, its the main thing. People are not experience buyers. While they might appreciate you they don’t necessarily buy you for that. Why? Because they are not used to it. Hence most businesses are competing on distribution and that’s exactly the reason why startups are having a tough time. To open up the market startup needs to be a force in itself first.

This is also a good news for the rest of the players as well. It will take the brass tacks off the equation. You will know, for once, who the biggest player in the market is. Once that’s gone we might get our focus right. And start paying attention to the only thing that truly matters if you are true to building an Internet business. And that’s customer experience.

WhatsApp Payments Controversy in India

I mentioned WhatsApp Business in passing while writing about Paytm in my first ever attempt to write about India’s tech ecosystem. My analysis was short-sighted in so far that my understanding of India’s payment landscape was limited. To put in another way I wasn’t aware of UPI. UPI stands for Unified Payment Interface. It’s a payment protocol specifically designed for India to make peer-peer money transfer as easy as sending an email. Almost all banks in India comply with it. Which means regardless of the bank you maintain an account with, you will have a unique UPI ID just like an email address. You can use this UPI ID only to send/receive money to/from whomever you want.

The benefits of such a level playing field for startups, looking to venture into payments, are enormous. From The Ken (paywall):

Startups would need to go through the software development kits (SDKs), made by banks, that acted as ‘wrappers’ on top of UPI’s core technology (APIs). Only banks would be allowed to directly access UPI’s APIs directly, so startups would need to find a bank willing to license it an SDK.

It was a payment system created specifically for India by the National Payments Corporation of India (which manages various payment standards in the country). It was imagined to be a payment system that works just like sending an email, complete with the person having a unique address. It is the closest thing to a one-size-fits-all payment solution as it can be used for peer-to-peer payments, peer-to-merchant payments, both online and offline. Its one limitation is that it can be used only through a smartphone.

The first company to adopt UPI was PhonePe. PhonePe is now owned by Flipkart. To make UPI more mainstream Indian government has its own implementation of the protocol called BHIM. Google came up with their own i.e. Google Tez last year. And then there is Paytm. WhatsApp’s entry is recent albeit most controversial one. The reasons are:

1. There is no username and password. If you can access your WhatsApp you can send and receive money. The reason behind this is WhatsApp, unlike other players, is not operating as a wallet. They are letting ICICI, their partner bank, take care of this.

2. Barcode implementation is missing which is a requirement for any UPI implementation.

3. You can’t send money to someone who is not using WhatsApp if you have an iPhone. You can do it on Android but the option is hidden deep in settings.

One person is particularly unhappy about this.

He is more unhappy then what’s apparent from his tweet. Listen to his interview with Bloomberg for a glimpse.

In WhatsApp defense, the Payments feature is still in beta—only available to selected 1M users of its massive 270M base. And NPCI (governing body controlling UPI) has clarified that WhatsApp will have to meet full requirements for their eventual public launch. With that said I don’t think Vijay is pissed off for some arbitrary reasons. He understands what WhatsApp is trying to do here. With all the goodness that comes with an open platform like UPI, there also comes a less so ideal customer experience. First, you have to download an app i.e. Paytm, Tez, PhonePe etc. On top of that, you need username/password and enter verification pins etc for the individual transactions.

Now imagine an app that you already use the most in your daily life. There is no username/password to it. And you don’t have to enter obscure UPI IDs and confirmation codes while you are sending money. A caveat here is that WhatsApp only lets you use Payments feature if your mobile number is same with both the bank and WhatsApp. This and by maintaining a closed garden approach for now (payments only between WhatsApp users on iPhone), WhatsApp is showing how seamless sending money can be. To the surprise of no one people are raving about it on social media.

It will be interesting to see how they manage to maintain the same user experience for someone who wants to send money to a person not using WhatsApp. Or maybe they don’t have to. They need to be interoperable with other players to comply with the regulations. But there is no regulation for an equal user experience. What Paytm, PhonePe and other have been able to do is phenomenal. To use them, however, requires a certain level of tech savviness. The same is not true for WhatsApp. Your grandma can send and receive money if you help her set it up for once. And that might be instrumental in doubling down on an already powerful network effect of 270M people.

Vijay Shekhar is right in saying that Facebook is bending the rules. But they are not breaking them. And that’s an important difference.