Edition 15

Amazon's growing pains, DTC bankruptcies, Corporate VC's struggles, nothing about a silly AI pin, some of my best (funniest?) headlines, and more things that matter now.

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This week

Going for a slightly different approach this newsletter, a bit more punchy, more links, less words, tell me if you like it more or less. So far I’ve only ever had 29 unsubscribes, so let’s see if this changes that.

Too big to mail

In the eyes of the US Antitrust regulators, Amazon is now too big and too dominant to be left alone. This is raising many questions, not least what market does Amazon dominate?

It’s about 6% of US retail, but Walmart has double that.

It’s about 40% of eCommerce, but the largest share of this is actually Amazon acting as a marketplace for other sellers, who one could easily argue need Amazon (and fake reviews) to compete.

Even without this awkward tension,? Luxottica has 80% of the glasses market, Apple has around a 70% value share of Smartphones in the US,? Google has 90% of search, so why not start there? ?

At the end of the day Monopolies thinking is based entirely around an old world where companies had assets, fixed boundaries and long standing definitions. These rules make less sense when Companies are more vertically integrated or more like ecosystems with networks effects, where Amazon’s dominance selling stuff, also allows them to dominate Advertising and Logistics and AI assistants and dash buttons, which gives them far more power than anyone can explain using market share. Interesting times, as always.

Nothing to grin about

SmileDirect Club filled for Bankruptcy this week, which in Corporate America does’t mean that much ( ask Marvel, Converse, General Motors, American Airlines, or Texaco). The significance is that this is another crack in the dream that is “Direct to Consumer” changing the world. At some point we should recognize that the internet does’t change the brutal unit economics attracting customers and shipping stuff to houses. This isn’t “innovators dilemma” this is “we’ve got a nice website. The shift from mail order catalogues to email order websites it turns out isn’t life changing. Ask Casper, Warby Parker, Peloton, Allbirds, Wayfair, Stitch fix. Etc. There is always the hope that at some point these companies get big enough for things to change ( make it up in Volume, or data or ads or something ) but evidence slowly builds to show this doesn’t really happen. Ask Blue Apron, also making the news this week.

More things from a Company founded by a guy who made billions from the idea of “Making it easy to rank the respective hotness of classmates”

Meta announced new spyware in the form of Google Glass 4.0 this week, which while a very impressive canvas ( Meta makes great hardware) to “do something with AI one day” begs the question, do we really want more technology in our lives.

For a while I’ve been convinced that the world will split into two groups and 98% of functioning grown ups will decide we need less influence of screens, cameras and messaging in our lives and we should focus on our lives not our feeds.

We need to live, not broadcast, we need friends not “friends”.? For everyone else, Meta also launched AI chatbots which means you can avoid calls from your mum, not have time to reply to texts from friends and instead chat with “AI Avatars” . If Meta was a person, not a company, we’d agree it needs therapy and to some friends and to have a nice walk.

You know, for kids.

There are two ways to work with a really exciting new technology. One is to think of all the problems in the world and consider how that technology ( and others) can best fix it.

The other is to think about all the possibilities it unleashes and work around that.?

Generally speaking the latter leads to far less success, but far bigger ones.? Having said that, for me AI is never THE IDEA, it’s the background. So I’ve no idea what this “ AI hardware” could be, but since AI is found across Smartphones, and Cameras and all manner of things already, this seems like SoftBank having too much money and no sense, for about the 10th time.

It’s not very VC

Mondelēz?is giving up on the brands it created in its SnackFutures VC arm, which seems like a shame to me. Instead it’s focussing on already established companies. There are about 1,500 corporate VC arms out there and nobody really knows what they are for.

Are they a way to play around on the stock market with the parents cash? orare they there to invest in existing companies that create synergies? Or are they there to explore other markets and hedge risk? Or are they there to invest in internally grown ideas?

Every route seems to face challenges and few companies have a clear approach. For me the the entire point is to do what Mondelēz is giving up on. It’s to use your own people, your own core competencies, your own relationships, and develop your talent in new ways, while making something brilliant. Why pay $700m for Blue Bottle coffee, when you could spend $7m trying to incubate 100 companies that could one day be as valuable. But corporations don’t wear failure well.

Check this out

For years I’ve felt online shopping needed sites you could buy from fast.? I worked very hard to build this ecom site where you didn’t “find out more”, then “add to basket”, then “add payment details” but instead could buy with one click. Shopify have finally woken up to this and are now rolling out this feature.

I look forward to the day someone bothers to make an advertising unit that you can buy from with one click. I have no idea why it’s taking so long for this to happen. Please take my money.

Little Ones

We saw even more proof this week that Airlines are banks who happen to operate some planes.

$70m raised to build the Tesla of boats. For a mere $300,000, soon you can look good on a boat, while helping save the planet, while being safe from rising sea levels (3 birds with one stone)

I’m so glad Greg wrote this so I did’t have to. We are not living in VUCA times, how many more times can we say this

AI influencers are being talked about a lot because they seem a bit fancy and dystopian. It’s all a waste of time really, the entire point of an influencer is that they are human and their influence carries a tiny bit of weight. P.S Buy my book.

Everyone is talking about the Humane AI Pin, so I won’t, nor link to it.

Why do people so readily turn to their devices, if doing so makes them less happy? And interesting paper on whats going on. FWIW I think we’re just hopeless at being under stimulated.

Starbucks has plans to speed up service with a program called Siren. This makes it faster to make all of the very complex drinks they make, most of which are loosely related to Coffee. Why not just throw sugar in everyone’s face and be done.

Ozempic could save airlines $80m in fuel. This is nice second order impact thinking, but the real story is how restaurants will lose billions from injected folk eating like rabbits and not drinking like fish.

Me Me Me Me Me Me

This week I was in Napa talking to a fascinating Private Equity firm about the trends that really matter for the future. Lots of interesting conversations were had about this moment in time and how things feel on the edge between a wonderful abundant future, and errrr, not that at all.

I’ve done lots of podcasts recently and “a fireside chat” and use this space to share them.

1. Me (alarmingly candid after 5 coffees) on a stage in London with the brilliant Jon Evans.
2. Me talking about luxury goods and design with the brilliant Anant Sharma from Matter of Form

That will do.

Oh, and I’m in Istanbul for this in November, talking about AI a lot.

Tom