David Chan's Profile

Thanks, Nicole! I think there are two reasons for optimism with M-Pesa. 1) No matter how much wealth creation occurs in emerging markets, transportation is a real issue and the gap between brick and mortar banks and residents is sufficiently large, even if geographic proximity improves (aka more banks are built). The convenience of mobile banking is a huge win here. 2) There are plenty of frontier markets for M-Pesa to target where economic growth is just beginning, and traditional banking lags.

Sina, thanks for the great post on the future of dentistry. The molding examples you brought up bring me way back to when I had moldings done for my retainer. I remember losing my retainer at one point and having to have new moldings done – it was incredibly time-consuming and very expensive (for my parents). There is definitely improvement needed in this branch of dentistry and it’s exciting to see how close we are to experiencing that.

One question I have for you is regarding your suggestion of commercial dental labs becoming vertically integrated to take advantage of this new technology. It seems like the capex would be pretty large to introduce these printers into an operating model, and I would imagine this could lead to some consolidation in the commercial dental lab market. Assuming this worked and economies of scale were achieved, do you think any of these savings would be passed on to consumer? The Affordable Care Act has increased the number of Americans with dental coverage, but orthodontic work has historically been prohibitively expensive. Even so, over 40% of American adults still are not covered for dental care through insurance. It would be amazing if technology like this not only improved care for existing patients, but also increased the number of patients who could now afford care.

Source: American Dental Association – http://www.ada.org/~/media/ADA/Science%20and%20Research/HPI/Files/HPIBrief_1016_2.pdf

Jodie, this was a fascinating read. As someone who is blissfully unaware of the current media landscape, I learned a ton through your post.

I agree that Maker’s top priority is shifting its consumer base off of YouTube and onto other media, like Netflix. As you mentioned, this is not for the faint of heart, and it seems consumers have not paid up for early access to media, as AG pointed out in the Verizon-Vessel example. An alternative approach would be for Maker to sign on a budding content creator or release the first few episodes of a particular series or saga, and then move the content creator/series off of YouTube and on to the Netflix/Sling TV/Xbox etc. I believe HBO took a similar approach with Game of Thrones & HBO Go. (http://www.slate.com/articles/arts/culturebox/2012/03/game_of_thrones_how_hbo_and_showtime_make_money_despite_low_ratings_.html)

I want to echo NT’s idea of treating MCN’s as agents – I think a hub-and-spoke model may work here. At the very least, it’s worth a shot!

Walter, thanks so much for the post. Appreciate your perspective on Amazon.

I have a few questions on Amazon’s strategic approach to growth and next-gen technology. It almost seems like they are throwing darts and seeing what sticks. As you mentioned, Amazon is investing in drone technology to revolutionize delivery, Echo/Alexa and other consumer IoT, IT-enhanced distribution, improved product suggestion via deeper learning, etc. Amazon faces competitors in each of these areas, and it makes me wonder whether Amazon is unsure of where the most valuable growth will be created and so they are going after everything. If I had an idea on which project out of the above would create the most value for my customers, I would invest much more in reaching completion of that goal. Granted some of these applications may complement others, I can’t help but question the breadth of product exploration happening at Amazon.

Nonetheless, it’s pretty amazing to see how bullish Bezos is on AI (http://www.geekwire.com/2016/amazon-poaches-ebay-chief-continues-ramping-machine-learning-operations/) – do you think they should have competed with Apple and ultimately acquired Turi? Found it odd that Apple acquired given Amazon’s relationship with the University of Washington and the $2mm the firm donated for AI professorships.

Jordan, thanks for this cool piece. Though I have definitely noticed the Vivo wearables line, I had no idea that Garmin’s revenues fell as dramatically as they did after mobile navigation was released.

As Philip pointed out, I am not confident that Garmin will be able to continue to capitalize on its leading position in wearables. A major disadvantage that they are facing continues to be the advancement of mobile tech. Corporate partnerships with major mobile developers, like Nike and Apple, has led to the development of software products like Nike+, and now even hardware products like the Apple Watch Nike+: http://www.apple.com/newsroom/2016/09/apple-nike-launch-apple-watch-nike.html. As GPS tech continues to advance and mobile data costs fall, I could see a lot of users transition to the software option, as it’s one less piece of hardware you have to carry on a run or bike. And although Garmin can compete on price (Vivo sells for as low as $99 vs. $399 for Apple Watch Nike+), there are cheaper and arguably similar quality wearable products out there.

If I were working with Garmin’s management, I would want to propose exploring corporate partnerships like Nike has done. It may be too late for Apple, but there may still be opportunities with other mobile providers. I believe the future will continue to be mobile, and so I can’t imagine Garmin’s current model being sustainable in the long run.

Dave, thanks for the interesting story on kCura. I looked up their website and was surprised by how much they segment their product offering. They break down Relativity into 8 different services, and also offer RelativityOne. Along with their service suite, they also offer different operating platforms, including one that is managed locally on the client’s hardware (and though costlier to use, is presumably more secure) and another that runs on AWS Cloud (cheaper, but potentially less secure). See: https://www.kcura.com/relativity/ediscovery-products/overview/ & https://www.kcura.com/relativity/how-to-buy/premises

I was surprised by how much differentiation kCura offers, and I wonder if it is too complex. Typically, SaaS companies strive to present simple pricing and product plans to consumers, especially if they are in a nascent business or are a first-mover. The fact that kCura breaks down the individual services worries me, as I feel like they may be nickel-and-diming customers, leaving the door open for competitors to take advantage. There are also substantially more competitors in this space than I would have imagined – found at least 20 on this one list: https://www.g2crowd.com/products/relativity/competitors/alternatives.

I strongly agree with your point on utilizing more unsupervised machine learning. I fear that their TAR program may do a solid job of automating the low-hanging fruit of document review, and would transition associates’ work to more complex or less common document review. However, as you pointed out, the goal of Relativity and other software products should be to complete document review in entirety, in order to allow associates to put their freshly minted JD degrees to higher-order use. At the same time, as Brittany pointed out, humans should always be involved in the process, even if as a checkpoint, since confirmation bias could creep in and lead to poorly performing automated document reviews.

Zach, thanks so much for your informative piece on Monsanto. It is indeed one of the most vilified companies out there. The carbon neutral crop production plan that the company developed is certainly innovative, and leverages some of Monsanto’s key strengths of thinking outside the box and taking agriculture where others have not.

The controversy around GMOs has always been interesting to me because the science behind GMOs is actually quite sound. Monsanto decided to be rather sneaky and not release much (any) information on what genetic modification was and why they were doing, and this is what led to public backlash, and why even to this day GMOs are vehemently contested for their safety. I wonder whether Monsanto learned a lesson here, or if they will continue to be less than forthright with product development, but that is neither here nor there.

I agree with many of your suggestions, but I do question the moral responsibility Monsanto has in shifting R&D dollars towards more sustainable (disease/drought tolerant) seeds. I, too, wish the company would take the lead here and signal to the market that they are serious about the environment – but is that best for business? Monsanto has done a fantastic job of setting precedent for strong intellectual property defense of their GMO and Seed & Genomics business, and it has become the company’s cash cow. At this point in time when M&A is at an all-time high in agribusiness, and considering the Bayer-Monsanto acquisition is seeming more certain, I can’t help but question what incentive the Monsanto (or Bayer) would have to reallocate these precious R&D dollars, and I can’t even bring myself to say it is their ethical responsibility to do so.

It’s an interesting question to wrestle with – thanks for sharing these thoughts!

Adam, thanks for this thought-provoking piece. I appreciated the deep lens you provided into the modern-day challenges of smallholder farmers in Malawi, particularly around erratic weather. At Gro Intelligence, we were routinely working with governments and ministries of agriculture with these challenges and often found communication gaps to be a recurring issue. Even if governments were aware of developing situations (worsening drought, onset of heavy rains), the odds of proper dissemination of that information to businesses like Toleza and perhaps more importantly to individual farmers was small.

The one recommendation I was a bit confused by was devoting more resources to livestock. You mention effects are amplified in agronomy – wouldn’t the ‘bullwhip effect’ be even more pronounced in livestock? And given how input intensive breeding livestock is, does it make sense from a sustainability perspective to commit even more resources to meat production when the same amount of resources can produce a much greater amount of caloric energy of another commodity? I find this to be particularly important in subsistence-farming regions, like Malawi.

One potential solution to the broader weather problem could be mobile technology. The mobile market in sub-Saharan Africa is a massive opportunity, and can serve as a medium to share critical weather information with farmers who would otherwise not have access to such data. Additionally, this could solve the communication gap that often exists between governments and market participants. https://gallery.mailchimp.com/30731ba6941f8414ea83c3aec/files/Gro_Mobile_Apps_Sept_18_2015.pdf

Majken, thanks for this interesting post. I researched Nestlé from the perspective of its cocoa/coffee businesses and came across some of Nestlé’s water conservation efforts. On the agricultural side, I was disappointed to see little work being done by Nestlé to reduce their water usage in agricultural commodity processing. It is somewhat encouraging to see that Nestlé’s direct water withdrawal per product ton has declined by 41% since 2005, though I think much more could be done.

I found the California controversy particularly interesting. I wrote an insight about the topic when I was working at Gro Intelligence (https://gallery.mailchimp.com/30731ba6941f8414ea83c3aec/files/Gro_H2NO_Drought_April_10_2015.pdf) and could not believe how dysfunctional the California water permit system is. There are plenty of opportunities for arbitrage among senior and junior water permit holders (https://www.caseyresearch.com/articles/a-big-arbitrage-opportunity-in-california-water). These are the same laws which allow companies like Nestlé to pay so little in taxes. The corporations like Nestlé receive all the heat for this system, while smaller market players who exploit the arbitrage opportunity even more are unknown to the public eye.

I think the only resolution to this situation is for the State of California to revisit its antiquated water permit laws and establish new laws to properly value and tax what has become an exceptionally precious commodity. Otherwise, corporations and individuals alike will continue to exploit this opportunity.

Totally agree with your point in educating consumers on the energy input required to produce meat. Beyond Meat is a flagship company in this space (Bill Gates among other prominent investors) and while they are commercial, they have faced significant headwinds in penetrating the consumer market, though a recent placement into Whole Foods’ burger shelf should help improve sales.

Ironically, the traditional meat company partnership has materialized to an extent within Beyond Meat, as Tyson Foods (!) acquired a 5% minority stake. http://www.nytimes.com/2016/10/11/business/tyson-foods-a-meat-leader-invests-in-protein-alternatives.html?_r=0 301 Inc., the venture arm of General Mills, also invested in Beyond Meat, which is another interesting investor case. Perhaps General Mills is confident that synthetic meat can win over enough consumers from traditional meat to change fundamentals and reduce livestock, thereby reducing grain demand and lowering raw material costs.

I believe this was alluded to above, but lab-based foods fall into a grey area of food and safety regulation (the murky waters of GMO), and in some countries, this will be a larger obstacle than in others. I believe one way to navigate this uncertainty is to partner early with your target market’s regulatory body and establish a fluid working relationship, as Beyond Meat and others have done in the synthetic meat world.

Thanks for this post, Matt! I was intrigued by your idea to replant trees in the forests to strengthen the canopy and provide more shade in warming regions. This also improves the biodiversity of the plots. http://www.cargill.com/corporate-responsibility/responsible-supply-chains/cocoa/index.jsp

While I think that could be an effective idea, I would advocate for replacing the actual cocoa trees first, as a disproportionate number of cocoa trees are aging and becoming less productive. In the above link, Cargill notes they are working on a replanting effort to transition older trees out of production. Since it can take up to 5 years for a cocoa tree to yield any output, farmers often forgo replanting and rely on increasingly aging trees, which is a poor business model since yield declines rapidly as a tree approaches the end of its life. https://www.devex.com/news/can-ghana-s-cocoa-farmers-ever-emerge-from-poverty-83883. I would encourage Mars to invest in a similar strategy as Cargill, and explore replanting both cocoa trees and shade trees.