Wednesday, 22 October 2014

Google's Alan Noble is happy. Another BBY Disruptive Lunch.

Maybe I'm wrong, maybe Alan Noble, Google's Chief Engineer in Australia is more than just happy, maybe he'd describe himself as feeling awesome, or fantastic, or something equally as hyperbolic? To me confidence and happiness have a very positive correlation, and usually if a person is happy they have a clear idea or confidence in what they're doing. Alan Noble exudes positiveness in spades, enough to have those attending BBY's Disruptive Lunch last Thursday leaning forward in their seats, intent on hearing the latest from the heart of the starship Google.

In many ways, it was a deceptively simple conversation. Noble gave us four or five themes, depending  on how you grouped some of the subtler sub-themes.

Cloud Computing allows the flexibility and mobility to escape being shackled to a device or environment. The old paradigm of licensing installed software to a single computer is changing fast. The ability to deliver applications across multiple devices cheaply is well established, but yet to take hold completely. Noble used the example of Adobe Illustrator, an expensive and unwieldy graphics package that may suit high-end users, but is difficult and restrictive to the retail level enthusiast. The disruptive counter is Canva (, which allows you the flexibility of accessing the programme from any of your devices and pay for what you use.

Omnipresent Computing (my terminology) is the v2.0 of the cloud where devices are continually assembling and formulating situational solutions. If the cloud was about connectivity, then omnipresent computing is about making better use of your cloud based data. Take, for instance, the current trend in wearables. I record all my exercise activity by wearing a number of sensors (heart rate monitor, cadence pod, etc.) and then export the data to a 3rd party to assemble in a usable form. The new wave seeks to collate the data and push through advice or actions. The algorithms will start to learn, rather than just be a set of field based conditional actions.

An example of this is what if the device you used to book a taxi started to learn when you're most likely to want to call for one. Maybe it's a result of knowing not only the weather or time of day, but also your physical state? The device might then proactively "push" a solution. Google's self-driving car is another example. Imagine a car that not only learns to drive the speed limit, but also knows your driving characteristics, such as when you prefer to slow-down or speed-up. Might it also predict routes and climatic control settings?

The interesting thing about Google is that they don't expect all the devices, software and platforms to succeed. Some of them are just about testing the limits of the theme. The car is a great example because of the staggering number of possibilities. Noble mentioned that Google Maps came from the Australian engineers, and he seemed to suggest that there was no particular outcome envisaged when they started the project. The result, of course, was an open API that let others capitalise on the data to produce various outcomes. I had a chance meeting with a Sydney based firm that was leveraging Google Maps to produce interactive solutions for university campuses. That firm had just won a mandate in California. If their solution starts to go from learning your timetable to know how you interact with your environment the possibilities for efficiencies and of course revenue start to add-up.

Software. . . For blog readers, you'll know that one of the most consistent themes of these lunches was the advantage of software solutions over hardware. Alan Noble and Google are about software. He called the software "the beast let lose". We've known for a while now that if you're a business the quickest way to low margins and extinction is to tie yourself to hardware. Apple might sell a lot of devices, but it also sells a lot of software through its app store. A smartphone without apps is not a smartphone, and a smartphone that is not merging the data in the cloud will get left behind.

At a previous lunch, we got to see Ollo Wearables and their solutions to aged care via mobile monitoring and voice control. The team there are focusing on software, not hardware. The data is the king, and the way you can leverage the data through the software will drive hardware manufacture.

This all leads to Big Data. If the software is the solution, then its only as good as the data it gets. This is where it helps to be open in your use of applications. Noble characterised it as the individual trading data for higher levels of service. The smart use of data leads us to the algorithmic targeting of ourselves.

If those were the big trends, then the delivery of all this seems to have coalesced around the philosophy of building the product first and getting the revenue later. The comparatively low cost in plant and equipment is allowing for wider experimentation with solutions to various problems. You get the sense that even if Google's biggest cost is the engineers they need to implement their various philosophies, they're still a comparatively cheap commodity given the outcomes they've already achieved. Google in Sydney has 500 engineers. If you said that to the man on the street in Sydney I bet they'd be surprised, but shouldn't be. Consider instead that if all this scalability is coming down the pipeline that perhaps we are understocked in engineers and overstocked with lawyers, bankers and maybe even teachers and doctors?

Finally, a note on Google as a business. Alan Noble raised a few eyebrows in a room of bankers when he said that Google wanted to remove the stigma of failure from their team. I even heard a few nervous stifled laughs when he said this. I can imagine as an engineer at Google going to Noble and saying: "well it didn't work, but we got some interesting data." I bet those nervous laughs were thinking: "are you kidding. That's a great way to get cut." Google calls their skunkworks "Moonshot X". There's a reason for that. You set a goal that seems as impossible as Kennedy's statement in 1960 that the US was going to put a man on the moon, and you see how far you get. Along the way, you throw off all sorts of data and products, some of which might justify the end goal without ever getting there.

If Google as a business is maturing when it says it's trying to focus on fewer things, then you shouldn't be fooled into thinking that those core projects aren't being leveraged into other areas. Giving away, your API might seem strange to the monopolistic instincts of a room full of bankers. To a room full of software engineers they see it as a chance to mine more data and to use that data for further crazy projects.

This was a great lunch to attend. Anyone who got an invite and didn't show-up is just plain crazy. If BBY through Nick Dacres-Mannings had opened this to the public, I reckon he could have filled a pretty big auditorium with profitable, paying tech acolytes. And thanks to Alan Noble for sharing his insights.


Wednesday, 15 October 2014

IBCyclist Consultancy the website, some events and the spring cycling season opens in Sydney . . .

It's taken some time, but the Investment Banker Cyclist Blog is going to morph into the IBCyclist Consultancy. For long time readers there won't be any change to the way the blog is published. The idea is that for a new generation of followers interested in actively pursuing my services I've created a website that gives a basic outline of what I offer. 

The site is v1.0, and I'm asking people for feedback before upgrading using the professional design group that worked on the Beca Asset Management site for me in Switzerland. 

As this entry is more a short news piece until a longer piece tomorrow readers might wish to know my movements in the coming days. On Thursday I'll be at a lunch being hosted by the team at BBY in Sydney for a presentation and hopefully Q&A session with Alan Noble of Google. I'll be writing about the lunch for the blog in the coming days. 

On Sunday you can find me at the Sydney Spring Cycle. I'll be doing the 55km ride from North Sydney to Sydney's Olympic Park, and riding back to the eastern suburbs after a short break. Look out for green bib number "1770". 

There's a 100km option, but that's a bit boring as you make up the additional 45kms by doing laps around the Olympic Park. The ride home is about 25kms for me, and I'd be happy to share all or part of the journey with any of my readers. Look out for my one of kind Cannondale SuperSix Evo in red, white and blue.

After that I'll be riding from Sydney to Wollongong on November 2nd wearing bib number "4215". That one is a 90km ride for Multiple Sclerosis. I'll be setting up a donations page soon, for those interested in sponsoring me for a great cause.


Thursday, 9 October 2014

The "I'm going to need a bigger brain" BBY Disruptive Lunch

I defy anyone sitting in last Thursday's Disruptive Lunch at BBY in Sydney to correctly outline to me how the proposed computer chip from Brain Chip ( actually differs from current technology. Probably like me, if you were taking notes, you wrote down something like:
  • 5000 times faster than a normal chip
  • Mimics biological brain architecture
  • Learns tasks, rather than relying on software
  • "Spiking neuron platform"
It all adds up to my personal conclusion that I'm going to need a bigger brain. Brain Chip is offering a technology that for 99.99% of the population only exists in science fiction. Robert Mitro (CEO) claims that the technology developed by Chief Technology Officer Peter Van Der Made (see his new book: is perhaps 25 years ahead of anything else currently available to industry. The chip will have the capacity of 10,000 neurons. That means little until you understand that the human brain has 86 million neurons. A fruit fly has about 3,000 neurons, which means if you're interested in the sounds that this fly species makes it should be possible for you to have the chip learn all the characteristics you need to build a detector. It's difficult to explain because Brain Chip is proposing something that is such a revolutionary leap that it comes under the heading of "if you build it they will come". I thought the best question of the day was "what are the limits of the chips learning potential? Say you had the chip learn how to hear like a human. Wouldn't it just keep learning until it had some type of superman like capability?" The answer was slightly ambiguous in that Mr. Mitro said that BrainChip sold the kit, but didn't set the boundaries of what the user could do with it.

According to the time-line, there's two years and $6m dollars between now and producing a chip. In between now and then it seems we'll see an example of the chip in action via the form of a car racing game that learns to drive itself. Apparently Google has taken an interest, as have various neuro-science bodies in the US. I asked Mr Mitro after the presentation whether that $6m figure was correct given just how revolutionary this was likely to be, and he stood by his statements. As an investor, I think it's right to be sceptical. To me, what Brain Chip is proposing is so big picture that it tests my limits of understanding. If you've spent too many hours reading Asimov then welcome to a new reality. This is the proverbial game-changer if they pull it off.

I felt far more comfortable when Hugh Geiger from Ollo Wearables ( stepped up to the mic. The company's focus is on tech solutions for the aging population. It's a familiar theme at these lunches. I first encountered the business opportunities of a demographic shift in the late 90's when the Japanese equity market started to throw up vague ideas of baby-boomers retiring to the country to fish, play golf and ride bikes. What we didn't think of then was the tremendous drain this would have on government and social support structures. Ollo Wearables is looking to fill the gap in the market that exists between conventional communications solutions and fully managed aged care.

Ollo is focused on voice-centric solutions. Geiger comes at this from a familiar angle; he had an aging relative hurt in a home accident and was unable to get to a phone to alert the family. I've also had experience with this as one of my aunties slipped in the bathroom and died because she was unable to get help. Therefore, I can appreciate the Ollo's wearable communications focus. The technology focuses on voice-controlled dialling, but includes other software controlled sensors such as an accelerometer that tracks the wearer's movement and physical activity so that family members know immediately if the wearer has fallen. They'll also be other biometric sensors that will help build a picture of the state of your loved one. The device uses a conventional GSM transmitter. The key is the software's ability to put it all together. Ollo don't want to join the race to the bottom in hardware manufacture, but rather license their software. Mr. Geiger was sporting a star trek inspired necklace (produced by LG of Korea) that is similar to a device that was used recently for trials of seniors in Missouri.
Similar to the LG model seen at the lunch

Apparently the necklace provides the optimum compromise in terms of sensor and voice control. It's also an ergonomic issue, whereas a watch has problems both for use as a phone or as a sensor to measure falls, the neck has access to your voice centre, pulse (via carotid artery) and provides a better indicator for accelerometer measurements. Additionally the voice control functionality doesn't require the synthetic learning process that I've encountered with voice control in several cars I've owned. That's a difference maker when you are dealing with a senior citizen who may lack patience with technology. Put it on and use it immediately.

The revenue for Ollo comes from licensing agreements. The team has relocated to San Francisco. Ollo is a serious company and investors if given the opportunity should seriously consider any equity offering.

The first two companies were so hi-tech focused I think I'd burnt myself out by the time the joint CEO's for Posse ( / eCoffecard ( / Beat-the-Q ( started their pitch. This one is a great example of something we're going to see a lot more of in the social media sector. This is a rationalization that is supposed to end, as so often happens with these things with a big winner. The land grab here is for 55,000 shops and about 500k users. When Rebekah Campbell (Founder and CEO of Posse) showed, a short video of what the new entity is all about my first thought was that I'm too old to embrace what I'm seeing. I don't have a copy of the video, but let me set it out for you:

  1. Business hipsters find café / restaurant on the app
  2. Enter establishment and activate app, which shows establishment's menu
  3. Place order via app
  4. Establishment accepts order and notes you have been geolocated to a specific table
  5. Food arrives, eat, and then you're prompted if you'd like anything else
  6. Pay via app and exit café / restaurant

All I could think was that Gen Y is going to kill the atmosphere at my favourite places. I'm already a little annoyed by people on smart phones. There's nothing more annoying than people on "ph-ablets" in low lighting environments "SMS'ing", etc. away. That, of course, is my problem, not Posse's. The problem for me is that the revenue model is based on up-selling establishments into the highest of three levels of analytical offering. If you own a café and have an MBA, you'll want to Posse to rationalize you're massive student loans and the 16 hours a day you spend working on your business. If you don't have the skills to use the stat packs, then Posse may make sense in a cost sense whereby you might save a headcount because of the self-service nature of the app. I remain sceptical on this particular segment. I have used eCoffeeCard and have recently signed up and reviewed a couple of local haunts on Posse (search: The IBCyclist Collection).

As an investor, I recommend not trying to pick winners in this market sector. Instead if you are committed to this segment you need to take a portfolio approach. I remain engaged, but not committed.

For those who've been wondering, I've finally taken delivery of my $450 Institchu suit. My plan is to review it after a couple of more outings. First impressions have been good. I went into the Institchu pop-up office in central Sydney to take delivery. I was surprised by how busy the space was, but the staff was friendly, although a little surprised when I said I wanted to try it on. The suit was delivered as specified by me except for the coloured felt I asked for under the collar. I'm not a particular fan of that particularly English affectation, but ordered it to test Institchu. It's not a deal breaker, but if you're fussy, it might be annoying. I did get working sleeve buttons and everything else I had specified. The suit came to me on wire hangers and the staff member needed to be asked for some type of covering for transportation, which was duly supplied. An acquaintance who took delivery via mail told me he was a little miffed that his suit was tightly folded in a box and needed pressing before wear. Look, you get what you pay for, and given the price I wouldn't quibble about the wire hangers or perfunctory packing. Please look-out for the full review soon.