Pippa Lamb's Profile

Hi Bernadita – definitely see this as a long-term use acquisition ploy with the potential for a variety of revenue streams down the line. Lunchalot below made a great point – an easy monetisation option already in play is partnerships. Jeremy also in agreement it seems!
To your broader point about these tech companies assuming the traditional roles of banks – this is exactly why the gvt is watching financial regulation so closely – check out my comments on 3) above! Thanks for reading!

Thanks for your comments and I totally get your concerns! My question however would be to what extent this rise of materialism is being driven by digitalisation, vs. China’s overall economic transition from a closed-control economy, to an open, free-market/capitalist economy. In addition, pre-digital hongbao times, when you were given a traditional red packet, you could still see how much money that person is giving you, so I don’t know if making this digital is something new. With physical hongbao, there are in fact additional concerns around materialism at play: are the notes themselves pristine, what does the packet look like, etc etc.

More broadly however, I do agree that the government needs to do some serious thought about the values being instilled in their population, especially as the proliferation of extreme wealth inequality grows. My main focus here would not be on digitisation however, but on education, and setting strong role models for the upcoming generation. I would love to discuss more (if you reveal who you are) ! Personally, I’m immensely sceptical of the current crackdown on corruption.

Sir Lunchalot, thanks for the questions! To your first point – yes absolutely. But it can go both ways – I wouldn’t for example say that the majority of Chinese users are particularly familiar with the intricacies of Western platforms, nor are the companies themselves particularly rushing in to landgrab international users at this stage. This latter point is key though – for NOW, continued innovation and competition in their own home markets has been more than enough of a challenge, but in the future yes – it’s quite possible that continued consolidation will drive BAT to clash with their western counterparts. At that point, it becomes a lot more interesting.
In terms of Western companies learning from Chinese ones – of course and again vice versa – the issue here however is that the fundamental characteristics of the environments they are operating in are just still very different (be it regulatory, economic, social) necessitating different biases in their development. Like I mentioned on Alibaba, e-commerce in emerging markets is a very different game to e-commerce in developed markets, which tend to have a very mature offline infrastructure already in place. China is much more of a clean slate – both a good and bad thing.

Totally agree with you on the partnerships. You should go and work for Tencent.

Todd loved this post. I’m actually a big follower (ok like medium to luke-medium follower) of block chain tech, and spent a bunch of time this summer reading up on it for similar reasons. Also have a few friends heavily involved in it. Most importantly however, like you, Field Foundations dramatically shifted my appreciation for this new technology.

Couple of points of comments/feedback:
1) One industry I’ve looked at this for is energy. One example is this company my friend joined a few months ago – effectively helping UK energy companies use blockchain technology to make pricing contracts more efficient: https://www.linkedin.com/company/7945922?trk=prof-0-ovw-curr_pos (their company description is very wordy and hard to follow there but we can discuss offline…) Website: http://www.electron.org.uk/

2) (Ironically given the fundamental point of blockchain…) security still looks like it could be an issue for the early stage roll out of the technology in different industries. Right after I started looking at blockchain this summer (mid-June) there was one of the biggest hacks in history on the DAO (which sits on Ethereum) https://daohub.org/ and https://etherchain.org/account/0x304a554a310c7e546dfe434669c62820b7d83490. I’m still trying to use FIELD to navigate a bunch of this stuff which can be a little confusing, but do you think it will still take a while for a lot of industries to actually take the plunge and get involved in this technology?

Great post, thanks! It’s a fascinating thought. A few things:
1) How do you envisage this venture and the broader project being impacted by regulation? You mentioned how initially, museum administrations had concerns that digital availability would create copyright and commercialisation issues which resulted in Google signing contracts with museums that pledge not use the content for commercial gain – how do you prevent others from misusing this though? surely once things are on the internet it’s hard to protect them from spreading?

2) What would that impact would widespread digital availability of art be on works held in private collections – would that dramatically shift their resale prices, do you think? Would you eventually see a huge mismatch between those available online vs. offline? Do you think this is fair?

3) To turn this inside out: I’m fascinated on how this could impact the CREATION of future art. How are present and future artists likely to rethink their creative methods, if they know the medium through which they will be viewed will be dramatically different/zoom-in-able to XYZ pixels? Is Google going to be responsible for a new art movement?

Thanks Famous Pete – glad to see you going back to your Greek roots with the shipping theme.

Totally get why Uber is needing to rethink its strategy – liked how you drew out the evolution of its most profitable assets as the market has changed. Do you really think shipping is the long-term answer for Uber though, as the industry itself has been going through one of the steepest re-ratings of the last decades? Or do you see the move as more of a short-medium term move? My concern would be with global growth slowing (thus pushing down the demand for global shipping) and increasing emphasis on things like eco-ships, the goalposts for Uber might keep changing.

That said – if there’s an industry that’s in need of disruption, shipping could be it..

On that second point, in your reading did you come across much on eco-ships? Thoughts on how they might fare in an automated world?

Hi there, thanks so much for the post. Interesting read.

I’ve spent some time research the impact of digitalisation on finance also – particularly in East Asia emerging markets (mostly China), so was very interested to look at this example in Bangladesh. I guess my main questions would be:
1) What would you say is the biggest risk to the business? For me, it has to be regulation – at least in the markets I’ve seen this. What do you think? Is it sustainable? Since the original change in regulation in 2011 that you mention, what has happened?
2) What would you say is defining about the technology that makes it so suitable to Bangladesh? Would you see it growing its business overseas, or is this much more of a domestic play?
3) Do you imagine they will try to do more partnerships like the Gates Foundation?

Thanks! Interested to learn more.

Hi Derek, thanks for the post! I also wrote on China tech – and on Hong Bao / WeChat /700HK!

One of the issues I found most striking was that of regulation. It seems from reading your post that you’ve looked at a similar issue but from a different angle. How do you see the relationship between Tencent and Beijing evolving, especially if they continue to consolidate access to apps? Do you think it will get to a point where Beijing will intervene?

I personally find the WMP/hongbao type angle the most sensitive to interference from CSRC – what are your thoughts?

On a separate note, I’m interested in how WeChat has faired in the Greater China area – how does Taiwan think about the different messaging apps? Isn’t Line more impactful there? Do you think this will change?

Thanks!

Hey Joanna! Fire up that wechat account, it sounds like you could be a direct beneficiary of the above story. Lol. As mentioned, I’m recommending all readers do the same (FYI @pippalamb).

1.) For now I see it as a land-grab between BAT – Baidu/Alibaba/Tencent – (and a few others like Sina who are getting in via one of the big three) – evidenced by the aggressive response to WeChat’s invention of the original hongbao app in 2014. Jack Ma couldn’t have been more blunt that he saw it as a direct attack on the dominance of Alipay. Certainly, if you consider BAT should be sticking to each of their respective territories (Baidu with search, Alibaba with ecommerce, and Tencent with content), Tencent was definitely treading on Alibaba’s toes here. For that reason I’d say that user growth and stickiness/retention will continue to be the driving force behind promotions like these, since the MAIN hurdle remains getting Chinese users to sign up AND upload their credit card details. If they can do that, I think the monetization of other goods and services down the line will follow. Of course after a certain saturation point they could look at different strategies, including pricing options. That said, I’d imagine providers would always be incentivised to retain SOME element of “free” when sending seasonal gifts of goodwill, for messaging reasons.
2.) – Will try to be shorter – again no, in theory anyone can build the software. The hurdle is having enough credibility and trust with users to upload bank details. For this reason, I’d think the advantage of BAT is likely to stay.
3.) Regulatory risk is the most pressing in my opinion, especially since the evolution of China’s financial system and ongoing opening up of their capital markets is an extremely sensitive subject. Just think of the problems around NPLs and where banks are being valued right now – the government is aware that international observers are waiting for a big China “crash”. The implication of this is a tighter watch on any sort of entity that is detracting control from Beijing – which yes, the rise of banking/wealth management products/financial tech apps – plays directly into. The trigger is hard to tell – probably when RMB volumes exchanged hit a certain level, or the amount of users relative to those using traditional bank accounts. Again – it’s hard to track this, but I imagine the government is doing its best to. For the both the government and the teech companies, I think it will be a case of “if you can’t beat them, join them”, and we will see some mutual collaboration. It’s sort of already started happening (e.g. the lol socialist propaganda hongbao).

Thanks for reading! A great analyst to read up on here if you can get access is Elinor Leung @CLSA.

Great post! Thanks a lot for sharing. Before reading your post I had no idea about the level of environmental discourse in India, nor how companies like Aspiration Energy were tackling the problem.

For context, having looked at the impact of the environment in China and other emerging markets, I was interested to look at the different ways Indian companies are responding to climate change. In particular, this was an article I’d read last year which helped place the dialogue in context; I’d love to know your thoughts on it: http://www.scmp.com/news/china/society/article/1886272/new-divide-china-and-india-diverge-approaches-climate-change

A few other questions/reflections:
How reliant is the Company on government support? You mention that Aspiration Energy was the recipient of several awards and that they have also received Government sponsored solar energy projects under the Ministry of New and Renewable Energy (MNRE): do their relations with the government need to remain cordial for this to continue? Is there a degree of political risk we need to factor into the effectiveness of their continued operations? (This is the case in China for example). In addition to this: you discuss the need for Aspiration to focus on expansion in its target markets, and leverage their work with MNRE to position them as the Government’s trusted partner in fulfilling its international climate obligations – who are their main rivals here? I’d love to understand the competitive landscape more fully.

I was very interested to learn about some of their specific technology, for e.g. the Evacuated Tube Collectors that are placed on factory rooftops to collect solar thermal heat radiation: are these thus very dependent on weather? You mention that Aspiration Energy has been able to use technological innovations to cover an entire range of temperatures needed for different industrial processes. What are the risks to the continued effectiveness and flexibility of these operations?

Lastly you mention that Aspiration should focus on expansion in its target markets: are these domestic only, or international too? How easy would it be for them to export their business overseas?

Thanks again for an interesting post!

Great post – thanks a lot for sharing. I had no idea that DHL were being so impacted by climate change, nor the extent to which the company has been acting to respond in recent years.

A few thoughts:
This question was also raised by me in the context of other companies, where the company is not simply a victim but an arguable cause of the problem: how has the dialogue shifted overtime with regards to DHL? Do you think the public view of them has evolved, given the work they have been doing? It’s extraordinary to think that in one year alone DHL contributed over 30 million tons of CO2.

In terms of the GoGreen Environmental Protection Program, and their specific operational efficiencies and innovative services put in place, have the goals of the program shifted overtime, or largely stayed the same? For a company with such a global reach, I’d love to know how differently they are implementing logistics in different parts of the world (I realise a lot of this is driven by the air vs. sea option that you discuss). I imagine that local law and business practices may impact these operations: are there any huge differences between for example their US roll-out and their international roll-out?

A similar question for their investing in hybrid vehicles: is this the case globally, or only in certain markets? It’s impressive to think they have promised to replace 90% of their 2007 owned air fleet by 2020 to meet its carbon emissions improvement goal – again, is this on a market-neutral basis? You mention that they have so far replaced eight aircrafts with Boeing 777F’s, which emit 20% less CO2: how are they doing on road vehicles? Is this information that they provide?

Lastly – you mention UPS; did you look at other specific competitors also? Such as FedEx? I came across this article http://www.environmentalleader.com/2016/04/28/how-ups-dhl-drive-emissions-cuts-efficiency-improvements-in-transportation-and-logistics/ which talks about some of the topics you raise: other than the longevity of these sorts of programs, what do you think are the biggest challenges for the industry as a whole to overcome? Do you think the DHL B2B consulting path will develop into a bigger operation? It sounds like something a lot of businesses would be interested in.

Thanks again for sharing!

Great post! Thanks a lot for sharing- a very interesting topic. I had no idea the extent to which smaller-tier farms and US agricultural operations were being impacted by climate change.

A few thoughts: you mention the issue that farms are brought into the debate as not just a victim but also a contributing cause to the problem: how has the tone of this debate shifted overtime? You mention that 8% of US greenhouse gas emissions in 2013 were from agriculture – has the ensuing dialogue on sustainability been able to reduce this over the last few years? From the sounds of things, farmers have really been trying extremely hard to minimize the impacts of climate change, whether it be via precision agriculture, or the refinement of specific farming methods.

I’d also love to know a little more about the geographical spread of these affected farms and agricultural industries: are their areas in the US that have been more adversely affected that others? You mention the case of Quality Grain Services in western Wisconsin: would you say that this example is representative of the larger group of affected farms? And how do you think different US states will be affected in the future – is law around this industry for example, more heavily affected by state or federal law?

In doing some further reading after your post I came across this article from MIT, which talks about the MIT Integrated Global System Modeling (IGSM) framework, as a way to improve the availability of information needed by farmers to make more informed decisions:
http://news.mit.edu/2016/gauging-climate-change-impact-on-agriculture-0707. Have you come across other models similar to this, that would also inform your concluding thoughts about how the industry can most effectively evolve in the future? Are farmers being given enough information on how to truly assess their needs?

Thanks again for sharing! Very thought-provoking.

Great post, thanks a lot for sharing. I had no idea the extent to which Starbucks has been involved with sustainability, nor how affected the company is on a unit-economics basis.

A few questions raised: I’d love to know a little more about how exactly Starbucks interacts with the farmers that it depends heavily upon to produce the coffee: what sort of contracts or arrangements have they in place to allocate their global supply? As you mention, climate change is disrupting production (given the rise in temperatures/impact on arable land for coffee beans): have they shifted their gepgraphical focus overtime therefore? Are they looking to move their farming to different locations? This would I presume, have huge implications upon Starbuck’s’ supply chain.

One interesting short introductory piece I found relating to this was published by the University of San Fransisco: http://www.usanfranonline.com/resources/supply-chain-management/starbucks-supply-chain-balances-efficiency-with-sustainability/#.WCFQW5MrJsM. It mentions that the company is streamlined logistically across six continents which seems a colossal amount, with materials housed in regional distribution centers ranging from 200,000 to 300,000 square feet: how do you think this will be impacted overtime from climate change?

Lastly: some of my further reading after your post led me to learn of their issuance of a U.S. Corporate Sustainability Bond in May this year: what is your view on this? How would an initiative like this be compared in effectiveness vs. creating the existing partnerships you mention (i.g. to develop a more robust crop innovation program), and creating a cross-competitor task force?

Thanks for raising such an interesting topic! My coffee won’t taste the same anymore..

Very interesting post Dan, thanks. I had absolutely no idea how much USACE was doing to contribute to sustainability before this.

In terms of what questions your post raised: I’d love to know more about how the focus of the USACE Climate Change Adaptation Plan has evolved over time. Have their primary goals been in line with the concurrent research studies that were commissioned – for example, you mention sea levels, flood and drought prevention, as well as carbon sinks. Or are their goals more broad? In addition, I’d love to know more about how these priorities are set by USACE: are these specifically directed top-down from other government related entities, or unique and independent to the US Army Corps?

For context – I’m extremely interested in defence policy, having spent time working with the British State Department and been fortunate to work with our British Military – only in a very different context. How close is the interaction between USACE with for example, the US Environmental Protection Agency?

In reading up on your post, I also came across this 2014 report from the U.S. Army, who on p.10 does mention USACE in their context: http://www.asaie.army.mil/Public/ES/netzero/docs/FY%2014%20Sustainability%20Report.pdf. They also mention that USACE helped facilitate development in four energy and technology areas: biomass, solar, wind, and geothermal. I’d love to learn more about their interaction thus with the U.S. Department of Energy (DOE) and how they pool resources and synergies to procure reliable, locally generated, renewable, and
alternative energy supplies. Again – who is most critical here in setting forth budget, and priorities?

Lots of food for thought – I will continue my mission to learn more about US public policy!