Markus Maier

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Rocket Internet – a copycat business model
Markus Maier
Last modified on December 4, 2015 at 6:48 pm
Rocket Internet created a business model of “stealing” business models and combining them with a hyper-effective operating model!

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On December 5, 2015, Markus Maier commented on Rocket Internet – a copycat business model :

Hey Z,
Rocket Internet has shown that it beats American startups at their own game across the world, with one big exception: startups with network effects. Be it the Rocket’s Pinterest clone “Pinspire” or Rocket’s Airbnbn clone “Wimdu”, Rocket Internet falters when network effects, rather than execution, is key to the cloned business model. The implications are that Rocket might never be able to move significantly beyond its core areas in terms of product breadth. Rather, the company will expand in even more developing countries, and grow as the eCommerce market of in those countries grows.

On December 5, 2015, Markus Maier commented on Y Combinator: Accelerating Innovation :

The first YC batch had only 8 companies. The “companies” were incredibly early stage, mostly without any users. In the first batch, there was Reddit. AirBnB and other mainstream success stories followed. These days YC accepts more like 100 companies and at much later stages. Many have had institutional investment already (at a much higher valuation) and just look for the YC reputation. Few have become success stories similar to AirBnB and Reddit.

This makes me wonder, has YC lost its mojo? Has the batting average decreased? Has YC increased its batch size so drastically because it doesn’t believe in its own ability to grow great companies but now subscribes to a “spray and pray” strategy?
YC should focus on how it adds value beyond the obvious monetary and network incentives. With a little bit more substance behind the fancy talk, maybe there is another AirBnB waiting around the corner.

On December 5, 2015, Markus Maier commented on #Twitter: A story of #failure :

Even though I spend considerable time on various social networks, Twitter never appealed to me. One reason: the insanely high barrier to entry! At Facebook, it is easy to find your friends and then Facebook revolves around you. However, Twitter is a winner takes all game. There are some superstars with millions of followers, but for the majority of the world who doesn’t care what Justin Bieber did last night, the network has little value. Because of this, I believe it can never be as mainstream as Facebook and only appeal to people that are really into certain “scenes”, be it celebrities, startups or startup-celebrities.

The question is, is this a bad thing? Facebook has a market cap of 300bn. Twitter’s market cap is currently 18bn. This is still a WHOLE lot of value created and nothing to be ashamed about. Maybe the company shouldn’t be punished by inflated market expectations during the IPO and just be content with a giant success story that attracted the most powerful men and women on earth to share their thoughts.

On December 4, 2015, Markus Maier commented on The Honest Company: No Smoke & Mirrors :

While I love Honest products myself, I wanted to add that Honest has been struggling recently to live up to the very high standards it has set for itself.

In September, Honest got sued for ineffective sunscreen. In addition to the baby wipes I believe Honest’s quality control should be scrutinized. Arguably, having ineffective sunscreen is worse than having a more sustainable sunscreen. http://money.cnn.com/2015/09/04/news/companies/jessica-alba-honest-company-sued/

Moreover, Honest has been sued for mislabeling “synthetic preservatives Methylisothiazolinone and Phenoxyethanol, a synthetic surfactant called Cocamidopropyl Betaine, and the petrochemical-based Sodium Polyacrylate”. http://www.huffingtonpost.com/entry/jessica-alba-honest-company-lawsuit_55eb2518e4b002d5c0763ab8

This makes me wonder, is Honest fear mongering new (and scared) parents into buying their products, which might not have any proven benefits for children and are not so honest after all?