Cloudy future for IPOs

Direct listings vs. IPOs gain traction

Using a direct listing to take a company public is a technique gaining momentum for companies that are less concerned about becoming public than raising additional money. Spotify and Slack employed the technique in 2019, and five or more companies are considering direct listings in 2020, including GitLab, AirBnB and DoorDash. The method is leading Wall Street banks to become far more flexible with traditional IPOs. CNBC

dis-rup-shun: Companies in general, and tech companies specifically, are savvy about communicating and reaching potential markets with current digital marketing tools. For companies flush with venture investments, Wall Street’s rigid rules for holding periods and over-sized fees are simply not needed and are being bypassed. Seeing the damage inflicted on the retail brokerage industry by Internet stock trading platforms, Wall Street will work fervently to not lose one of its biggest paydays — the IPO. The disruption has already begun, however, and the IPO fee structure will never be what it was.

The Irishman helps Netflix gain cred

Netflix is counting on giant blockbusters such as The Irishman, viewed by 26 million households in its first week, to attract the top film producers to make great movies and series. CNBC

dis-rup-shun: Netflix was amazing until others, namely Amazon, offered more new release content, albeit for an up-charge. Then there was everyone else — including Warner and Disney that control vast catalogs and have studios where the best of the industry are created. Differentiation is no longer about convenience or price, but about offering “must watch” content. Whatever streaming service is not required for participation in the all important water cooler conversation will be purged from the overtaxed credit card account. Netflix has declared that its production budget will secure its place in the must watch category.

What are smart glasses 2.0?

North brought its lighter, more-stylish Focals line of smart glasses to market in 2019. It is now turning its sights to Focals 2.0 — thinner, more powerful with better display. The second generation of smart glasses will likely remain priced at around $600, and will continue to be the leader in alternative ways to view smartphone generated images. TechCrunch

dis-rup-shun: It is rough be on the bleeding edge of a new product category and smart glasses seem to be a bit like the slow adoption of wearables — some good offerings but consumers took a few years to be convinced they needed the product. Apple is said to be working on AR glasses and, as soon as the company enters the market, North can expect to be acquired by Google, Facebook, Amazon, or some other large brand that wants to enjoy the benefits of Apple creating a new category while having to compete. North will have to continue to survive by serving early adopters until a big brand can generate viral demand for the category. Perhaps Warby Parker is that brand.

Rating cloud services on environmental responsibility

Cloud computing is the future of computing and is the economic engine fueling massive growth by Amazon, Microsoft, Google and others. These services consume massive amounts of computing power, and electricity. Wired has evaluated the practices of the biggest three cloud providers and rates them. Google received an overall score of B+, Microsoft a B, and Amazon Web Services was scored C+. Factors considered include use of renewable energy, use of efficiency algorithms to maximize cycles per watt, and creative ways to reduce emissions, such as Microsoft’s location of data centers on the ocean floor.

dis-rup-shun: Amazon, the largest cloud provider by far, appears to have grown so quickly that it has struggled to keep apace with zero carbon pledges made by its competition. The socially conscious tech giants, however, will drive creation of renewable energy production at large scale, helping to make energy storage more viable. Expect companies to make purchase decisions of cloud providers with environmental responsibility an important priority, behind price.

Ready for a smarter lock?

Former Apple employees start a smart lock business

Level Lock is the latest entry into the smart lock business. The founders are former Apple employees who envision a smart lock that can be controlled by an app, by smart speakers such as Alexa, can be included into home automation scenarios, can be unlocked with a code texted to someone, and is backed by Walmart and Lennar homes. CNBC

dis-rup-shun: A few former Apple employees leave the company to create a far better version of an everyday household product that will sell for a premium. If the story sounds familiar, it is the story of Nest, which was quickly gobbled up by Google for $3.2 billion. Level Lock sounds like a great sequel, but this time big investors like Walmart and Lennar lined up early, possibly to keep the company from being swallowed up by Amazon or Google, or big lock makers such as Assa Abloy or Spectrum, who purchased August Lock and Kevo, respectively. Add in the growth of the AirBnB rental economy plus the rising demands of home health care, in which strangers will frequently enter homes, and the timing is good for Level Lock.

Google’s hardware party

Google unveiled several new products at a launch event in NYC. The new products include:

Pixel 4 Phone –┬áselling for $799 or $899 for the XL version, implements a better camera, facial recognition technology, and gesture control.

Pixel Buds – Google’s answer to Apple’s AirPods, featuring BlueTooth distance of a football field or three rooms inside a building.

Pixelbook Go – starting at $649, is a souped up Chromebook that provides more memory and more processor for those that can live on a cloud based computing device.

Nest Mini (re-branding of the Google Mini smart speaker) – is $50, smaller, comes in bright colors, can serve as a home intercom, music player, or can be used to call people on their phones.

Nest Wi-Fi Router — priced at $269 for 2 or $349 for 3, are colorful small devices that spread Wi-Fi signal throughout the home by creating a mesh network. Wired

dis-rup-shun: Google’s hardware rollout has been, to date, a bit disjointed and it has definitely made some heavy handed moves with its integration of Nest products into the Google mothership. It is hard for the Big Tech companies to be all things, but it appears that they are all trying, with even Facebook now in the hardware business. Given the close relationship between devices and services, first manifest in the iPod and iTunes, it seems that each Big Tech company needs to ensure that its services will have a device home by building its own hardware. The dream of open systems in which any hardware device can run any software or service app (like an AM/FM radio or a WinTel PC) is once again under fire, as companies race to own complete product ecosystems.

TytoCare is a home health device that includes the doctor

TytoCare is a multi-purpose tool about the size of an orange, with multiple attachments to enable one to perform simple at home health tests. Tests include ear exam, heart rate measurement, temperature, lung and throat exams. The app connects the device to a doctor, who can either remotely take over the exam, or who can read data from the just-performed exam and make a diagnosis, including prescribing medicine. BestBuy Studio @ Gizmodo

dis-rup-shun: When the first in-home thermometers were sold, people must have felt they were on the threshold of a technology breakthrough. Tyto is the new home thermometer, and for those with young children, the convenience is astounding. Devices like Tyto will contribute to the demise of the family doctor, who will now be bypassed by the rotating crew of corporate doctors at the other end of the TytoCare app. As mentioned previously, these new business models will make it easier for doctors to thrive in the world of expensive office rents, equipment and insurance.

Flexera survey spells trouble for enterprise IT providers

A study of anticipated IT spending shows that as computing moves to the cloud, makers of enterprise premise software, namely Oracle and IBM, may be big losers. ZDNet

dis-rup-shun: Migration to the cloud is no secret, and a trend that started a handful of years ago. But legacy software and services providers may not have moved quickly enough to stem the rush of revenues to big cloud providers such as AWS, Microsoft and Google. What is not measured by Flexera is the fallout to IT consulting shops such as Accenture, HPE, Deloitte, etc. whose businesses may be under pressure from cloud companies who are good at packaging solutions with their cloud services. Why would an enterprise pay Accenture hundreds of thousands for a custom implementation when AWS could offer similar solutions-as-a-service rolled into the cost of computing time and data storage fees? It’s a fast changing landscape.