S1W10: Fitting it all in

Once again this has been a week of trying to fit it all in. Thankfully this time I’ve been a bit more successful at it than I have been in the past few weeks. The last few weeks have really been all about clearing out the backlog so I can start to get things back on track again with the priorities I have in my life and whilst there’s a never ending ‘to-do’ list of sorts I feel a bit more in control than I have been in the past few weeks.

This week we had a few major pieces of work to complete for the Garage Project and Business Acumen which absorbed a lot of my time. Because we lost about half of our semester dealing with issues within our Garage Project group we have had to deliver the equivalent of 8–9 weeks of work in the space of 2–3 weeks. Given the constraints I don’t think we did a particularly bad job but the feedback we got from our lecturer clearly showed that there was a lot of room for improvement.

I’m not particularly upset about that, there was clearly a mis-match in expectations around what could have been delivered in that timeframe considering that there are a lot of assessments backended into the semester and all of us are super busy outside of class. In any case, the feedback is worth going through again at some point once we get the taped video of our presentation. It was very good to spend some time ‘out of the building’ talking to customers though, I really enjoy that and I learnt a lot as usual from these customer discovery sessions.

The Business Acumen assignment was a whole other kettle of fish. I thought it was going to be relatively simple and quick to do…20+ hours of work throughout the week later and I finally finished it. The assignment required that we do a financial analysis of Facebook’s financials along with another company of our choice providing a historical context for both companies, compare them to their competitors, reference financial ratios inc. vertical and horizontal analysis’s and a view on where the businesses will be in 5 years time…all in 2000 words. I had a big of trouble trying to figure out how to fit that kind of scope into 2000 words and in the end I just gave up trying to. My analysis was 18 pages long (inc. 3 appendices) and 2,800 words and I had a lot of fun actually trying my hand at trying to build a narrative around Facebook and Xero.

In particular I really enjoyed extrapolating 5 years in the future for Facebook (esp.) and Xero. Facebook in particular is a very interesting one given their acquisition history, scale, aggressiveness and market. Facebook can really go anywhere, here’s an extract of my report:

The future of Facebook is very bright at the moment as there are few competitors with the momentum, scale, expertise and technological clout to compete in their markets. Given the industry in which Facebook operates in, the most likely competitors to Facebook probably don’t exist yet so it is hard to predict the future 5 years ahead. What you can be confident of is it is unlikely that management will be caught ‘sleeping at the wheel’ solely relying on seeing their existing business models ‘mature’ as they aggressively continue to innovate their business model.

I would anticipate that in the next 5–10 years Facebook will have transitioned into a more diversified, ‘immersive and sensory’ entertainment/social and content business further separating itself from its existing competition and carving out entirely new industries. This will be part of a continuing their transition from desktop to mobile to virtual reality which is increasing its touch on consumers both in terms of constancy and immediacy of interaction but also complete sensory stimulation as it builds out its platform to include virtual reality.

This will likely end up revolutionising the gaming, events and news media industries (which it has disrupted already but hasn’t yet replaced with a working monetisation framework) by earning revenues from platform/ecosystem fees (e.g. iTunes fees), virtual products (e.g. ‘Second Life’ extended virtual identities — fantasies, storage and capturing of your life’s memory for playback, and perpetual life of deceased people etc) and physical products (visual headsets, audio, gaming controllers, cheap smart phones etc) likely to become a significant part of their business model.

The sophistication of their existing advertising revenue will also improve with more ‘organic and subliminal’ product placement in games and news distribution which could fund both a ‘freemium’ model but potentially also lead to a paid ‘no-advertising’ model similar to Spotify. Facebook will also likely become a trusted financial intermediator and credit business taking small fees from money transfers competing with Western Union, ApplePay, PayPal, Visa/Mastercard and other similar businesses through their messenger platforms.

It will also continue to extend its reach into other countries and demographics in search of more users except for countries it may be locked out (China/North Korea). To do this it will continue its strategy of extending global internet infrastructure to the poorest areas of the world like what it’s trying to do in India, potentially locking various parts of the world onto its proprietary infrastructure.

Aside from the really long sentences (a habit) I was mildly impressed with my own creativity to be a futurist. We’ll see where Facebook in particular goes in 5–10 years time.

This week also included a lot of talks mostly in the social venture space — a Compass event talking about the ‘New Social Impact Leader’ with Elliot and Tim Costello which was middling as far as interesting goes. Then we went to The Difference Incubator where we learned all about Impact Investing from Bessie Graham who gave some good albeit not entirely satisfying answers when it came to convincing me that social enterprise is going to save the day. There were some gold nuggets though in her talks

1. that not all businesses are meant to scale, some are meant to be small but replicated and through replication some of the benefits of scaling can be gained
2. government money can be a sustainable revenue stream if that value you’re bringing would otherwise be provided through a government service at a more expensive rate
3. you don’t need to everything — to be a social enterprise you don’t need to give away all your profits and have an ethical sourcing pipeline and be vegan — you can do one of those things and giving away all your profits is a damaging stereotype an generally bad business practice for the industry

The next event was a Women Entrepreneurs — Defining Success through Melbourne Knowledge week hearing from a number of amazing women entrepreneurs.

It’s always really interesting and different seeing a panel full of women. It’s so so so different to a panel of mixed genders or in 99% of cases a panel with just all guys. I was relatively anti-social in general (aside from chatting to Jon Kenton COO of Corrs — my scholarship sponsor) that particular night despite knowing a lot of the room I think in part because I just wanted to observe rather than be an active participant but I couldn’t quite be a passenger, I had the good fortune of being asked to give flowers at the event to Sam Cobb at the end.

This week I also got the chance to catch up with some friends which was awesome. Earlier in the week for a dinner date with some old friends which was wonderful trying Japanese Whiskeys, hearing about recent trips overseas and just generally enjoying each other’s company. Then I had a big day out on Saturday at wineries in the Yarra Valley for a mate’s 30th which was luckily enough on an absolutely glorious day.

Yesterday was Mother’s Day too so I spent some time with my mum, sister and her husband and my niece and cousin who was dropping in before heading out to Adelaide. That was really nice albeit brief and I wasn’t all together in the present moment at the time because I was catching up with a mate of mine who is moving to the UK for his business, Sleeping Duck which is continuing to go great guns it seems. Next up was a game of basketball with my mates who I haven’t played with for about 2 months it seems. The game itself was forfeited but it was fun to just run around a bit.

Before finishing up applying for a Pitch Contest ‘IdeaNation’ with B-School for a M-time. Hopefully we get through — it’d be fun pitching at the MCG and hopefully getting $20K funding.