Opening Remarks at The San Francisco On-Demand Conference, May 2015
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“Welcome Ladies and Gentlemen to the first ever On-Demand Conference. I hope you are as excited as I am to be here today.
For those of you who don’t know me, my name is Pascal Levy-Garboua, and this event is the realization of something I’ve wanted to see happen for a very long time. As an active angel investor in many on demand companies, including Sprig, Shyp and Caviar, the former founder of an on demand company, SixDoors, and the current Head of Business at Checkr it would be an understatement to say that this is a topic I like to discuss.
These are exciting times for on-demand Companies, and it is great to finally see everyone, from founders and early team members to investors and suppliers, coming together to discuss and debate the important issues we will encounter as this market continues to mature. With a record $4.2B raised last year, there is now no doubt — the on-demand economy is real, it is not going away and it is going to change the way the world works. Which means you, the people in this room, have the opportunity to create the defining brands of our generation. That is something I am very excited about, and that is why are we are all here today.
That being said, before we start talking about the future, it’s probably important for us to take a moment and look to the past. If we look back in history, “on demand services” are not necessarily new.
A little history
Domino’s Pizza has been an incredible success since the 60s — opening up to 3 stores a day in the mid 1980s. And the Dabbawala network in India has existed for more than 100 years and delivers upwards of 200,000 lunch boxes every day without an app.
But then in the late 90s, you had Kozmo and Webvan, which were fast growing startups, raised billions of dollars, and then failed very publicly. The first wave of the Internet was about a computer somewhere talking to another computer in a warehouse somewhere. It was the time for Amazon or eBay, not for this.
Because business models were not designed right, city expansion plans were way too aggressive. These are important topics we will discuss together today.
What else has changed? Obviously there are way more people online now than in 2000 — and way more people that are buying online too. There is an addiction to speed too — the one you get when you get back from LTE after some time spent on 3G. Amazon Prime deliveries. Netflix instant video. Spotify. A 4 year old does not understand the Internet, but most hate slow networks while watching Youtube Kids. With speed — there is no getting back.
On Demand In Context
To me, the On Demand Economy is at the intersection of two mega trends impacting all of us: the future of local commerce and the future of the workforce.
There has been merchants in city streets, then came big box stores and fast foods along highways and parking lots for a suburbian life. Now our generation wants to live in cities again, and mobile technology and the cloud have created a new virtual road between me who wants something, and the person with a phone who can fulfill what I want.
The services we are going to talk about today have at their core the willingness to redesign the customer experience that existed before around the way it should be..
Uber showed us the way with transportation — and it happens to many more industries, from fast casual food to booze or weed, from cleaning to washing or grocery. It will unlock more and more the city around us, from gym classes, to cars in the street and private rooms in buildings. If few services are in more than 20 cities across the US, the success of a DoorDash in the South Bay, or a SpoonRocket in the East Bay or of Instacart with working moms show how these services are going beyond a tech-saavy urban population and into the mainstream. Prices are going down, and the ecosystem is being built to allow these services to spread faster. Trust as a service with Checkr, “Where is my order” as a service with OnFleet, Delivery as a service with Postmates, Rickshaw and many others. Large brands are following suit — from Starbucks to Audi. Not because they think it is cool — but because what prevents a Silicon Valley startup to create an on demand cafe delivery that serves good premium coffee for $7? As for Audi, at least four major car manufacturers are testing on demand car sharing or car renting program.
We will also discuss about these building blocks and about creating great customer experiences today.
And then there is the future of work — which has made a lot of headlines recently. The rise of the freelancer economy which will account for close to 40% of the workforce in 5 years. Where we discover that taxi drivers make less money than lawyers. There is something scary about giving up control of your income to a platform — especially a startup. But then, there is also something gratifying in talking to Lyft drivers who drive to pay rent while pursuing an education, or as a complement to pursuing their higher paid passion as a dance teacher.
There are definitely a lot of things to improve on the worker’s side — and I hope that new services will be created that will make income more predictable and dependable — and that new regulations will be more adapted to a mobile-enabled workforce. These are also topics we will be discussing today with Kim-Mai Cutler.
The On-Demand Economy is not a fad — and it’s exciting to think that with all the money raised by these startups, they will grow to more and more cities or more verticals and be able to positively impact the experience of millions across the country and create meaningful consumer or business brands. For these startups to grow and new ones to emerge, they need to think through their business model, design their customer experience online and offline, get growth in one city then expand to multiple cities, hire contractors (for the most parts) or employees and raise money. And given that those are the issues we’ll be dealing with for the next few years, I don’t think we could have assembled a better group of founders, investors and other leaders in the space to help us all understand where we are today, where we can go tomorrow and what it will take to get us here.
And now, it is my great honor to welcome somebody who invested in Uber when it was still controversial, as well as Postmates, Munchery, Shyp, or Taskrabbit as an angel or a VC — Shervin Pishevar. He will be interviewed by Semil Shah from HayStack who is a very active investor in in the on demand stack — so welcome to them, and have fun today!