Predictions of the Day

Tuesday, 04/14/2015

Pros and Cons — David Brooks of the NYT opines in a thoughtful op-ed on the issues surrounding ubiquitous cameras on police officers. Yes, cameras might ensure that the truth is brought forth more often than not. But, as Brooks notes, “Cameras will undermine communal bonds. Putting a camera on someone is a sign that you don’t trust him, or he doesn’t trust you. When a police officer is wearing a camera, the contact between an officer and a civilian is less likely to be like intimate friendship and more likely to be oppositional and transactional.” Certainly not a simple issue for any of the parties involved: citizens, officers, or local/state governments.

Don’t Get Burned — Mike Maples of Floodgate predicts that the focus on capital efficiency (the ratio of how much money a startup has raised to how much value they’re creating out of it) will only intensify over the next 2 years. Mike’s in no way alone here. Bill Gurley, Fred Wilson, Brad Feld, and Josh Kopelman have expressed similar concerns in recent months over valuation risk and burn rates amongst late-stage cos. Yes, the money is there, but is there a healthier way? As Feld noted yesterday, it’s no doubt a lot easier to make a 10x return on a company that has only raised $10m then it is to make a 10x return when a company has raised $100m.

Will Apple Beat(s) Spotify? — I put a stake in the ground on how Apple’s upcoming streaming music service will stack up to Spotify (disclosure: I’m a user), the leading streaming platform. Apple’s service, which builds on Beats Music (acquired last year), will likely be unveiled at its worldwide-developer conference (WWDC) in early June. Apple will no doubt gain a healthy amount of users, but to what extent it will poach from Spotify is up in the air. Spotify has a decent moat: it most recently claimed 60M total users. The network effect Spotify has built is also strong. All of my friends (and their friends) use it, and we all share songs and playlists via its social features. A non-zero switching cost. The stakes will be high though: revenue from digital-music just exceeded those from CDs for the first time.