Soap seller William Wrigley Jr. switched to hawking baking powder in the late 19th century. To drum up business, he gave away chewing gum, and eventually he realized that customers were more excited about the freebie. The gum stuck.
The payoff: Now a Mars subsidiary, Wrigley is the world's largest gum manufacturer.
Fusajiro Yamauchi founded Nintendo in 1889 as a purveyor of playing cards. His great-grandson unsuccessfully expanded the company into taxis and "love hotels" before hitting gold in the early 1970s with an electronic shooting game.
The payoff: Gaming domination via Super Mario Bros., Game Boy, Wii, Pokémon Go, etc.
The mouthwash was first marketed as a general-purpose antiseptic, meant to get rid of both household grime and, um, gonorrhea. In 1914, pharmaceutical company Warner-Lambert started selling it as a halitosis remedy.
The payoff: Current owner Johnson & Johnson sold $340 million worth of the stuff in 2015.
The Minnesota Mining and Manufacturing Company (get it? 3M) originally planned to sell excavated minerals to manufacturers. But when that didn't work out as planned, it shifted to producing finished items, such as sandpaper.
The payoff: Some 60,000 products later, 3M makes everything from Post-its to surgical soap.
Geophysical Services Inc. made tech to help gas companies find oil. The start of WWII forced GSI to halt its profitable overseas business, so in 1946 it formed a lab to develop electronics.
The payoff: The lab grew into Texas Instruments, maker of your high school calculator and still a top semiconductor producer.
When Steve Jobs bought into the business that would become Pixar, it was a maker of graphics oriented computers. He refocused on software, and Pixar later started making animated films.
The payoff: Pixar's movies have pulled in more than $10 billion over the past 21 years.
Conceived as a mobile-encryption service, the company switched to cash transactions (initially between PalmPilots). After eBay users latched onto the service, PayPal developed into the leading tool for web-based payments.
The payoff: PayPal helped fuel the e-commerce boom and today is worth more than $47 billion.
Caterina Fake and then-husband Stewart Butterfield started Ludicorp to develop online games in 2002. One feature let players save pics, and it proved so popular they moved away from games and built a photo-sharing service.
The payoff: Flickr became the go-to home for digital photos and was acquired by Yahoo in 2005.
YouTube launched in 2005 as a video-dating site. Users didn't bite, but the company's founders soon noticed that people had started sharing other kinds of video content.
The payoff: YouTube is the world's second-most-visited site (after Google). Viewers consume 3.3 billion hours of video every month.
Burbn tried to be many things: a Foursquare-style check-in app, a friend-meetup service, and a photo-sharing tool. Noticing that photos were users' favorite feature, Kevin System ditched the other functions and rebranded as Instagram.
The payoff: More than 500 million monthly users post 95 million photos and videos a day.
The founder of PC Magazine, PC World, and Macworld was an entrepreneur who thought like a social activist.
In 1973, a former schoolteacher named David Bunnell got a $110-a-week job as a technical writer for a tiny Albuquerque-based maker of calculators called Micro Instrumentation and Telemetry Systems, Inc., or MITS. In later years, he admitted that he knew virtually nothing about electronics at the time. But he was there in 1975 when MITS introduced a microcomputer, the Altair 8800. The machine kicked off the PC revolution, including inspiring two budding computer nerds named Bill Gates and Paul Allen to write a version of the BASIC programming language, which led to them founding a company they called Micro-Soft.
A Bunnell photo—complete with scroll bars—from the first issue of Macworld
Starting in April 1975, Bunnell edited MITS's newsletter about the Altair, Computer Notes—a periodical that, as far as I know, was the first devoted entirely to the subject of personal computers. He went on to start Personal Computing, one of the first slick magazines on the topic. Then he cofounded both PC Magazine and PC World, the Coke and Pepsi of PC publications. And then Macworld—both the magazine and the trade show. At one point, four of the top 10 computer magazines were ones he'd started, and PC Mag, PC World, and Macworld are all still very much with us in online form.
Bunnell died on Tuesday evening at his home in Berkeley, California, at the age of 69. I worked PC World for 13 years, and though I arrived years after he left, he was an inspiration to me in ways that went far beyond him having created the publication that gave me a livelihood. Above all, he was a guy who saw technology as a tool for human beings.
David Hugh Bunnell was born in Nebraska in 1947. That meant he came of age in the 1960s—which he did by, among other things, founding the Nebraska chapter of the activist group Students for a Democratic Society; leading a 4,000-person march on City Hall to protest discriminatory housing in Lincoln, Nebraska; attending the trial of the Chicago Seven; and participating in the massive 1969 anti-war protest in Washington D.C.. (He also found time, in his senior year at high school, to serve as sports editor at the newspaper where his father worked.)
ASCII art of Bunnell from Personal Computing
After graduating from the University of Nebraska, Bunnell worked as a teacher in Chicago and then relocated to the Pine Ridge Indian Reservation in South Dakota, where he smuggled food to the Native Americans who occupied the town of Wounded Knee during a 71-day armed standoff in 1973. (Before his death, he completed a memoir of his Pine Ridge days, Good Friday on the Rez, for publication next year.) From there, he moved to Albuquerque and stumbled his way into the computer industry by answering MITS's want ad in a local paper.
At MITS, he produced documentation, started the Computer Notes newsletter, and presided over the 1976 World Altair Convention, the first conference for PC users. That put him smack at the center of an industry that started out minuscule, but just kept on growing. (He even helped Microsoft put together its very first ad.)
In 1977, Bunnell devised the idea for Personal Computing magazine and convinced Benwill, a Boston-based publisher, to fund it. Less geeky than Byte, the biggest computer monthly of the time, it was a template for many mass-audience tech magazines that Bunnell and others would found in the years to come. He even got his former MITS colleagues Bill Gates and Paul Allen to write a software column for it.
Bunnell wanted a share of ownership in Personal Computing; when Benwill wouldn't give it to him, he walked after just a few issues had been published. (The magazine continued on without him, quite successfully, into the early 1990s.) He relocated to San Francisco and, after a brief period working as a word-processing operator, became managing editor at the book-publishing firm founded by Adam Osborne, who would later be best known for his eponymous portable computer. When IBM announced its first PC in 1981, Bunnell, Osborne colleague Cheryl Woodard, and Jim Edlin were inspired to found a magazine devoted entirely to the new computer and its ecosystem. With a staff of six (including Bunnell's wife Jacqueline Poitier, who survives him) they put together the first issue in a spare bedroom at the Bunnell home.
The first issue of PC Magazine
That magazine—PC Magazine—was such a success that multiple large publishing companies were soon interested in acquiring it. In fact, Bunnell and Woodard thought they'd struck a deal to sell it to Pat McGovern of IDG, publisher of Computerworld and InfoWorld, when they learned that their financial backer had sold it to Ziff-Davis without bothering to tell them. They—and 48 of the magazine's 52 staffers—responded by promptly quitting to found PC World for IDG. Its first issue was so thick with advertising that it set records.
With their next major IDG launch, Macworld, Bunnell and Woodard perfected the art of hitching a media brand to a computing platform. Thanks to a deal Bunnell hammered out with Steve Jobs, the magazine debuted on January 24, 1984, the same day as the Mac itself, and was promoted directly to new Mac owners via materials that shipped with the computer.
In 1985, Macworld the magazine spawned Macworld Expo, one of the few successful tech conferences ever aimed at consumers rather than industry types. By the time I started going circa 1988, it was held on both coasts and the Boston edition, which I attended, filled two convention centers. Still later, well after Bunnell was no longer associated with it, the San Francisco version made front page news each year as the venue that Jobs used to announce products such as the first iPhone.
David Bunnell (front row, third from right) and the founding staff of PC World
The thing that made Bunnell intriguing rather than merely successful was that he never stopped thinking like a 1960s social activist, even after he became a tie-wearing publishing magnate. In 1986, for instance, he published a blistering editorial in PC World and Macworld decrying Georgia's sodomy law as being a violation of the spirit of the PC revolution—a bold decision given that the state was, at the time, home to numerous major companies in the industry, some of whom yanked their advertising. The move led the Fund for Human Dignity, an LGBT rights organization, to honor him with its Howard J. Brown Award.
"The overwhelming thrust of the personal computer is that it can liberate and empower people," he told the Los Angeles Times in 1987. "Unfortunately, so far it has largely been a white males' revolution." Publishers of trade magazines are not exactly known for talking like that.
Bill Gates, David Bunnell, and a PC
Bunnell left IDG in 1988. His many subsequent ventures didn't attain the name-brand status and longevity of a PC Magazine or Macworld, but included such inventive ideas as BioWorld (a biotech publication sent by fax at a time when that was cool) and ELDR (a magazine for active, affluent people over the age of 60, which happened to be the age David had reached when he started it). He also founded Computers and You, a computer-skills center in San Francisco's notoriously hardscrabble Tenderloin neighborhood.
In 1987, Bunnell accepted the Howard J. Brown Award—and met Dr. Ruth
As a long-time computer magazine junkie who began working at PC World starting in 1994, I was well aware of Bunnell's importance to the industry I worked in. But I didn't meet him until we began planning the 20th anniversary issue of PC World, which appeared in early 2003. My boss, editorial director Kevin McKean, asked him in to have lunch and talk about the old days—an invitation of some significance given that our cofounder's departure from IDG had been followed by years of legal tussling between him and the company.
When we gave Bunnell an impromptu tour of our editorial offices, he told us that he hadn't been back since leaving the company 14 years earlier. I still remember our head of human resources, who'd been there when Bunnell left, coming across us in a hallway and looking dumbstruck to see him back on the premises.
After that, I ran into him every so often, usually in interesting circumstances. Once year, we ended up standing next to each other in a sea of people waiting to get into a Steve Jobs keynote at Macworld Expo, with him casually sharing tales of what it had been like to start the whole thing. Another time, we found ourselves seated at the same table at a New York awards banquet where ELDR was being honored.
David Bunnell and high school graduates honored by the Andrew Fluegelman Foundation in 2012. Fluegelman program director Bruce Bouligny is at leftPhoto: Kevin Warnock
The last several times I saw him were at benefits held in conjunction with the Andrew Fluegelman Foundation, which was named for the late founding editor of PC World and Macworld. Founded (and funded) by Bunnell, the organization provides college-bound students from underprivileged backgrounds with MacBooks. He was a twinkling, giddy presence at these events, taking palpable joy in giving away computers to people who really needed them. For all the other accomplishments he packed into his life, I can't imagine a better way to remember him.
It took long enough for the company to release a retro console, but it got all the little details right.
In the days of eight-bit gaming, Nintendo was the undisputed king of gaming. Before it became the company of Wii and DS, games like Super Mario Brothers 3 and Duck Hunt dominated the industry. This holiday season, Nintendo's big release is a pure nostalgia play: The NES Classic Edition, a miniature scale replica of the 1980s Nintendo Entertainment System that comes preloaded with 30 games for $60. It's scheduled for a November 11 release.
I took the console out for a spin on a recent press visit by Nintendo to Los Angeles. The new console is much smaller than the old-school Nintendo—it fits comfortably in one hand. However, it comes with a full-size replica of the 1980s-era NES controller (more on that later) and connects to a television with a standard HDMI cable.
The NES Classic is preloaded with games ranging from Super Mario Brothers 3 to Tecmo Bowl to Castlevania and Legend of Zelda. It's essentially a NES greatest-hits selection that's designed for ease of play. Users are limited to the games that come with the console; new titles cannot be loaded off the internet nor manually added.
I played the NES Classsic games on a large flat-screen television of the sort you see in many offices these days, it's a far cry from the small analog Toshiba TV I played Nintendo games on back in the 1980s. That's when one of the most interesting features came into play: Users have the option to simulate the scan lines of an old-school TV, the blocky screen resolution of the old 1980s games, or an engineer-centric mode that promises to show "the games exactly as designed."
As far as the gaming experience, it's exactly what you'd expect if (like many of us) you spent your childhood tethered to an eight-bit Nintendo. It packs a lineup of amazing, addictive games and is easy to set up and designed for the nostalgia market—setting up the console doesn't require anything more complicated than plugging a HDMI cord into a television.
By releasing the NES Classic, Nintendo also shows off one of its core competencies: Creating a product that's similar to competitors, but easier to use and much more accessible.
Eight-bit emulators for Nintendo games—software packages which, installed on a computer, tablet, or phone, make it possible to play old NES games—have existed in various states of legality for years for most major devices. However, the emulators require a bit of technical work to install—not enough to make it out of range, but just enough to turn away the unwashed masses of casual users. More importantly, playing emulated Super Mario Brothers 3 on a smartphone just feels weird.
Consumers have also been able to buy all-in-one consoles for different old-school platforms for years. Retro Atari consoles, which came preloaded with a variety of classic 2600 games, began popping up in the early '00s. Sega, Nintendo's great eight-bit and 16-bit rival, licensed its intellectual property to a company called At Games for a similar product called the Sega Genesis Classic Game Console.
But where Nintendo excels is in the little details. The NES Classic games play as flawlessly as they did on the original eight-bit console—users of the Genesis emulator complained of poor playing quality and difficulty saving their games. Touches such as the CRT emulation mode add to the retro feel, and the NES Classic Edition is sturdy enough for handling by a small child.
When I took the NES Classic for a test spin, one thing surprised me: The cord for the controllers is very, very short—far shorter than the approximately eight foot cord on the original NES. Nintendo of America's David Young told me that one of the reasons for this was to encourage users to keep the console close to them while gaming: The Reset button on the console is used to save games to memory. Young recommends users use a longer HDMI cord to connect the console to a TV.
Ultimately, with this console, users play on Nintendo's terms, rather than through the anarchy of a Android or Windows emulator. At the same time, there's a massive fun factor—and it's designed for sharing, with full two-player mode and easy setup. It all adds up to an engaging piece of retro repackaging.
Glassdoor's new tool is helping to balance the wage gap, increase pay transparency, and help employees earn more.
Salary information has traditionally been hidden, like a secret deal between an employer and an employee that is too taboo to discuss in polite conversation. New machine learning tools, however, are finally bringing this information into the light, helping employees gain an understanding of whether they are being compensated fairly, whether they could earn more elsewhere, and where discrepancies between genders, races, ethnicities, etc. may be lurking.
Companies such as PayScale and Paysa already help employees track and compare their salaries. Today a new player enters the market, courtesy of Glassdoor.
The online employer review site has just launched its Know Your Worth tool, which is designed to show U.S. employees how their base salary compares with real-time market trends.
After entering their employer, location, job title, years of relevant experience, and base salary, the machine-learning algorithm scours through job listings in the local market, job transition data, the quantity of job openings, and the response rate of those listings to provide the user with real-time supply and demand patterns.
"It's largely based on what others are sharing, but another large part of the equation is something no other calculator is doing, which is taking into account real-time job market trends," says Scott Dobroski, Glassdoor's community expert. "Glassdoor now welcomes about 33 million unique users each month, and we hold several million data points related to salaries from employees on about 600,000 companies in 190 countries," he adds. This database is then combined with near real-time local labor market trends pulled from millions of current job listings, job transition data, local salary reports, and the number of job listings for that title, as well as application rates and click-through rates.
As a point of comparison, Paysa's machine-learning algorithm uses nearly 8 million points of data, including job postings, resumes, and social activity across 200,000 companies over the past 10 years. PayScale, on the other hand, employs a database of more than 54 million total salary profiles gathered via 150,000 surveys conducted each month, according to its website.
While each tool uses different methodologies, they all seek to provide more transparency for salary and compensation.
Glassdoor's Know Your Worth tool is able to provide market-value information for approximately 55% to 60% of the entire U.S. workforce today, with the intention to incrementally increase that percentage moving forward. "In most cases, this will be in very rare or obscure job titles, or in fields, locations, or areas where there is not enough data currently to calculate a market value for an individual," says Dobroski of the remaining 40% to 45%.
"This is in our beta mode, the first iteration,"Dobroski adds, "but because it employs machine learning, it will continue to gather more information and only get smarter over time, so we expect that percentage of Americans we can serve up only to increase."
Most adults in the U.S. can enter their information on the site and see how their base salary stacks up against industry norms in their local market for their specific role. The tool also provides users with suggested job openings nearby that might provide a higher base salary for the same position, or suggest locations where they could be earning more.
Such tools are helping to combat the gender pay gap by providing more transparency to what employees should be making, regardless of gender. In previous studies, Glassdoor notes an overall pay discrepancy between men and women of 24.1%.
"We hope this will help correct any pay inequalities that exist for people, whether they know it or not," says Dobroski.
While the Know Your Worth tool provides users with information regarding base salaries, it does not account for other forms of compensation, including tips, commission, bonuses, benefits, and equity, at least not in its first iteration. Users are, however, encouraged to submit those additional compensation details so that the Know Your Worth tool can incorporate them in the future.
"Base pay is the start," says Dobroski. "In the next iteration we want to include all of this, make it even more personal and relevant for people."
After a dismaying 2015, CEO Nick Woodman is refocusing, betting the company's future on software, new audiences, and a bit of Karma.
Nick Woodman, the founder and CEO of GoPro, flew into Vail, Colorado, yesterday on his private jet. He is here for the GoPro Mountain Games, a weekend-long festival of kayaking, rafting, rock climbing, and just about anything else you can do at an off-season ski resort while wearing a mounted action camera. Woodman, whom college buddy and current GoPro colleague Justin Wilkenfeld describes as less "a 9-to-5-type guy" than "a hippie surfer," wanders through the tent-covered meadows wearing flip-flops, shorts, and a tank top alongside throngs of action-sports enthusiasts. Passing a funnel-cake vendor, he sniffs something else in the air. Colorado is a popular destination among the GoPro community not just for the adrenaline rush of extreme sports, but also because of plentiful legal weed. When he asks a GoPro events coordinator what he is doing later, the junior staffer avoids eye contact with his boss, shrugs, and a little too adamantly insists, "Nothing. Why?"
Woodman laughs.
"It's like, dude, I don't care if you're going to enjoy some extracurriculars," he says.
The whole week is one big GoPro-palooza. Everywhere you look, alongside the occasional toker, there is someone doing something worth capturing on video. A woman paddleboards down a brisk stream. A slack-line walker tiptoes over some rapids. A mountain biker bombs down a ski run. A dog jumps off a dock.
Woodman has taken up position among a hundred spectators gathered around an aboveground pool. Arms folded, wearing Persol sunglasses, he watches a wide range of canines leap in after tossed balls, their jumps scored for height, distance, and form. Many of the dogs are wearing GoPro cameras, and half the crowd is holding up GoPros. Woodman does imitations of each canine's posture in the air, hunching his shoulders, lowering his neck, recessing his jaw, or forming an overbite in his best impression of man's best friend. A former high school linebacker and avid surfer, Woodman has an easy physicality that he uses in conversations to illustrate a point or reenact an experience. He also has the infectious self-confidence of an entrepreneur who built his own business into a billion-dollar-a-year juggernaut before the age of 40. The GoPro Games are like an annual victory lap for Woodman, a reminder that no matter how battered his company's stock price—and over the past year or so it has taken a wallop—the brand is still thriving.
When Woodman assembled the first GoPro camera in the early 2000s, he created not just a novel, durable device, but an entirely new market: the action camera. The company grew rapidly, its devices becoming ubiquitous at ski resorts, surf spots, and other adventure destinations. With a huge assist from 140 sponsored athletes, GoPro videos garnered millions of views on YouTube. By 2012, the company v was averaging 100% annual top-line growth. Its 2014 IPO was a wild success, with shares leaping 140% in the first three months. Giddy investors hoped that the upstart tech company could leverage hardware into even more profitable software spaces: media management, entertainment, social networking. But a disastrous 2015—including the flubbed launch of a new camera—punctured that enthusiasm. Revenue for the first quarter of 2016 was down year over year, and a much-anticipated drone release was delayed. When Woodman arrives at the GoPro Games, the company's stock is flirting with all-time lows, down almost 90% from its peak.
In the hot seat: GoPro has been like an iPod without iTunes, says founder Nick Woodman, who blames himself for all his company's failings.[Photos: Justin Kaneps]
It's a ride that could make even the most seasoned extreme-sports enthusiast dizzy. Woodman takes a seat on an off-duty ski lift, the high Rocky Mountain sun behind him. And then he dives into his plan for reviving the company he loves. He says that a trio of new products being released this fall—including that delayed drone, called the Karma—will help win over a swarm of fresh consumers. New software will make video editing easier and content even more shareable. He is relentlessly optimistic.
"In a sense, we will make the GoPro a detachable lens of your phone," Woodman says. "By enabling a GoPro to auto upload its content to the cloud, your footage moves over to your phone. We will blow the doors off this."
Woodman sees GoPro as a sort of mini Apple, a hardware company that is evolving into a software platform with social networking features. Its business model will even include monthly subscription fees alongside steady hardware upgrades. He evinces no worry about naysayers who compare GoPro to the Flip, the superhot handheld digital video recorder that launched in 2007, quickly dominated the camcorder market, was bought by Cisco in 2009, and shut down in 2011, when video-capable smartphones quickly made it obsolete. Today's smartphones are becoming ever more durable—both Samsung's Galaxy S7 and iPhone 7 are water-resistant—while lens quality is rapidly approaching GoPro's most advanced offering. (The iPhone 7 offers a 12-megapixel sensor, the same as GoPro's new Hero5, and a true zoom lens, which GoPro's Hero5 lacks.) "My kids are 16," says Michael Pachter, an analyst with Wedbush. "And I don't recall ever going to a soccer game and seeing people with GoPro cameras. They are taking videos on their phone. I think that limits GoPro's addressable market. Imagine only marketing your shoes to professional athletes. Nike wouldn't be Nike if they didn't sell shoes to everyone."
Woodman's response to this: The smartphone boom actually works in GoPro's favor. "You can put a GoPro in places you wouldn't want to put all your data," he says. "Like, do you really want your phone, and all your information, attached to a drone 2,000 feet up?" In fact, while we are talking, my iPhone overheats in the sun, causing the voice recorder to fail, but the GoPro camera trained on us records the entire conversation.
Woodman's office in GoPro's San Mateo, California, headquarters is just a few miles from the house on Moss Beach where he crafted the first prototype for the GoPro Hero. He's notoriously prone, once he begins speaking, to going over his scheduled time. As more of the company's projects have moved outside his area of expertise—software, drones, virtual reality—he has learned to defer more to his staff. He's married with three children, and his steady enjoyment of his success is evident from how eagerly he shares his experiences, either surf trips to islands off Nicaragua or video clips—some of them shot, he sheepishly admits, on an iPhone—of a lavish birthday with his friends.
His desk is uncluttered. Behind him, a cabinet bursts with souvenirs—motorcycle helmets, giant bottles of wine, an Emmy Award (which the company won for the Hero3 in the Technology and Engineering category), a model of the VW van that he and his then-wife-to-be, college sweetheart and fellow University of California, San Diego, fine-arts major Jill Woodman, drove up and down the California coast selling bead and shell belts she made to help fund the company's launch.
When Woodman first began envisioning what would become GoPro during a surf trip in Indonesia in 2002, cell-phone cameras were a novelty rather than a standard feature, and nobody dared take a video camera into the water. What Woodman wanted was to capture surfing images from the perspective of the surfer. "I went to a surf shop and bought a bodyboard leash, and I bought all these O-rings and off-the-shelf parts at Home Depot, and I borrowed my mom's sewing machine," Woodman says. His first effort wasn't a camera; it was a strap, onto which he mounted a disposable camera and added a few features so that the camera was easier to click while in the water. The strap worked well enough that Woodman decided that his calling was making exclusively those.
It wasn't the first business Woodman had attempted. The son of an investment banker who grew up in Atherton, California, Woodman quit his Menlo Park high school football team before his senior season to surf. "Everyone was like, 'Dude, you can't quit,' but then I thought, No, I have something unique going on. And I remember that feeling good. That was my first lesson where I felt that, hey, doing something different from everybody is satisfying." It was during a golf outing with his father when he was 17 that he decided he wanted to be an entrepreneur. "We were on the seventh hole at Burlingame Country Club in San Mateo, and there was a big old house being built on the side of the fairway, and my dad said, 'See that house, that's my friend's son. His name is Peter Gotcher and he just sold his business." (Gotcher was one of the founders of ProTools and now sits on GoPro's board.) Entrepreneurship, his father told him, is one of the most reliable ways to do really well financially. Then Dean Woodman nudged his son and said, "I bet you can do that one day, Nicky. You have a lot of ideas."
One of Woodman's earliest ventures, which he started upon graduating from college, was FunBug, an online video-game company that offered users a chance to enter a weekly raffle. Woodman blamed himself when the company didn't make it. "Here's something that I learned with FunBug," he says. "FunBug didn't fail. I failed. FunBug is just a business. It's a product of your own creation and the team's execution, so businesses don't fail, the people who are running a business fail. That was a difficult time for me." Woodman gave himself until age 30 to come up with something successful. "Young enough to start a career from scratch, but enough time to make it as an entrepreneur," he says. "I promised myself that even if I failed repeatedly I would not stop, no matter what."
The wrist strap seemed an unlikely prospect, but Woodman dug in. As he experimented selling them in surf shops for about $15, he was blunted by the quality of waterproof cameras available on the market, which were often unreliable and tended to crack in rough surf. He tried to license the wrist strap to Kodak so that it could build a better, more dependable camera on top of it. "I thought I could make a couple hundred thousand bucks a year, but they were selling so many disposable cameras anyway, they didn't see this as part of the future. Kodak not being interested saved GoPro."
After searching in vain for a durable, waterproof camera at trade shows around the country, he decided to build his own. He set to work on a prototype, in what can only be described as obsessive fashion. He wore a CamelBak backpack for rehydration and worked 18- to 20-hour days, carving and shaping plastic with a Dremel and using a glue gun to affix plastic buttons and lenses. He sent his model to Hotax, a Chinese camera company, and it sent him back a digital file that he couldn't open. It took him a few hours to figure out it was in a standard format for 3-D modeling, and when he finally glimpsed and rotated the model, with the water housing and all the fit points that would allow it to stay attached to an athlete at play, "I was so stoked." With around $20,000 left over from FunBug (and his wife's shell belts), plus a $200,000 loan from his parents, he made a deal with Hotax to manufacture each camera for about $3 and sold them at surf shops for $14. The first GoPro Hero was born.
Woodman, with each ensuing iteration, showed an uncanny knack for product design, and GoPro quickly became the dominant player in what has grown into a $6 billion market, selling more than 5 million cameras a year. Along with the steadily rising sales, Woodman now admits, came a pretty bad case of founder's hubris. The company was a media darling, with Woodman the subject of glowing profiles and the durable cameras helping to redefine action sports. The "GoPro video" became a genre unto itself—jerky, POV shots that provided the viewer with a taste of the experience. The GoPro channel on YouTube attracted more than 4 million subscribers and over a billion video views, and the cultural reach of the company transformed the sports landscape, with athletes able to film themselves using smaller, lighter cameras than ever before. "It's a huge shift," says professional snowboarder Mike Basich. "You don't need a cameraman. In the past, you always had a crew. Now you can steer your expression closest to what you experience yourself."
For sports like snowboarding, skateboarding, skiing, and surfing, the arrival of GoPro accelerated the trend toward more and better footage, while the explosion of social media meant there were now numerous outlets for amateur athletes to share that content.
The company had achieved that rarest of parlays: It was both cool and a great business, with universal recognition within its category, bountiful goodwill from a youthful market, and margins on individual cameras of close to 50%. Wall Street was similarly infatuated, and a few months after the company went public, in June 2014, the company introduced the Hero4 Silver, its best-selling camera. That October, GoPro's stock peaked at nearly $94. Almost immediately, Woodman angered investors with a surprise donation of 5.8 million shares of GoPro stock to the Silicon Valley Community Organization, which diluted shareholder equity. Soon, according to Woodman, "the afterglow started to wane a little bit. We had so much publicity from the IPO, we didn't recognize the need to ramp up our marketing." Even as demand for cameras began to slacken, GoPro continued to rely on viral videos and word of mouth instead of more strategic advertising.
Analysts and reporters began asking if GoPro had saturated its market. How much more than 50% of the action-camera industry could it really take over? (Sony, Garmin, Praktika, and a host of other cheaper alternatives had by then carved out single-digit market-share niches.) In the overall video-camera field, GoPro was already selling six of the top 10 most popular cameras. Where was growth going to come from?
A great new product might have calmed these concerns. But instead, in July 2015, the company launched the $399 GoPro Hero4 Session, a point-and-shoot camera that bore an unfortunate resemblance, in style if not function, to a competing $99 offering from Polaroid. The company and Woodman were widely pilloried for overcharging for an underwhelming product. (It lacked an LCD screen and 4K capability.) GoPro eventually dropped the Session's price to $199, and Woodman went on QVC himself to try to move units. Revenue in the third quarter of 2015 missed the lower end of GoPro's guidance, and a lull set in. In the first quarter of 2016, revenue was down 50% year over year. In May, shares hit a low of $8.80.
Sitting in his office reflecting on this history, Woodman leans back in his chrome armchair, puts his hands together in almost a parody of a man in contemplation, and takes full responsibility for GoPro's missteps. "I'm the one who made the mistake on pricing Session, I'm the one who made the mistake with pulling back on marketing, I'm the one who made the mistake with releasing too many products at the expense of consumer confusion. These were my calls," Woodman says. He was, he insists, swept up in his own success. Woodman truly believed the Session was a remarkable camera: waterproof in its own casing, easy to use, essentially a one-button-capture solution. But he says that greed got the better of him: He priced it too high. "At the end of the day, it's hard to call it anything else. But we thought it was so good it would be worth it."
The Session debut, and the disappointing sales that have haunted the company over the past year, marked what could now be considered the end of the beginning for GoPro. "The media were hard on us when we stumbled, but we deserved it," he says. "What you didn't see from us was lashing out and saying, 'You don't understand.' We acknowledged it. We put down our heads, determined what was wrong, and said we were going to fix it."
A big part of the fix is supposed to be the Hero5, which launches in October. The most advanced GoPro yet, it will have a faster processor, built-in waterproof casing, linear horizon stabilization, and improved sound quality, including automatic microphone adjustment when there is noise or hiss from wind or weather.
But it's a new software package, internally code-named Yellowstone, that is potentially the biggest advance. Even GoPro's most devoted users have long bemoaned that, as easy as it is to capture footage with a GoPro, moving that footage from camera to computer or phone, editing it into a compelling video, and then sharing it to a social media platform is too hard. Every step of the process, from turning on the camera's built-in Wi-Fi to transferring the footage to editing those images into a punchy, short clip, has been slowed down by what Woodman himself describes as "pain points."
I happened to ride back from the GoPro Games in Vail to Denver International Airport with C.J. Prober, the senior vice president of software and services for GoPro, and the whole ride back both of us were editing footage of our day spent whitewater kayaking. The drive was approximately two hours, and all that time we had our heads down, clipping and transferring footage. Occasionally, I had questions about moving data from the two GoPros I was using to my phone in order to do an edit. Prober, an Electronic Arts veteran, knows GoPro software literally better than anyone, and twice, he was stumped by my technical issues.
While avid athletes may be willing to spend a few hours editing down that day's session to a cool three-minute video, most of us don't have the patience. "There is a lot of unwatched and unedited GoPro footage out there," says Brad Erickson, an analyst with Pacific Crest Securities. "It's daunting to capture video and deal with editing it. If you ask a lot of people who bought GoPros two years ago how much they really use them and ultimately what the utility was for that device, you find a broad range of answers, including: 'We've used it twice and haven't taken it out of the box since.' "
Woodman once again blames himself for how slow GoPro has been to address these limitations. "I underestimated the size of the team and experience needed in leadership to develop the software experience that we needed," he says. "It's an entirely different skill set and approach than hardware." Woodman, who dropped his one programming class in college—"I have never tried so hard to be so sub-mediocre at anything in my life"—in 2014 hired Prober, along with veteran tech company executive and network and infrastructure pro Tony Bates, who became president. When we all gather in Woodman's office a few weeks later, Woodman eagerly points to both hires, and several more in software and new products, as examples of his taking ownership of his own mistakes, citing one of GoPro's six core values, Integrity Always, as the source of inspiration.
"Make Friends. Haul Ass. No Half-Assery. Then, um," Woodman says, pausing to try to remember GoPro's core values. "The last one is Be a Hero, and then, above that is Integrity Always. Maybe it's just five core values? How many core values do we have? Oh, Maintain Balance is the one I forgot. How many is that? Anyway, you have to take ownership of your mistakes. People respect that."
"You can put a GoPro in places you wouldn't want to put all your data," says Nick Woodman, explaining the company's relevance in a smartphone era.[Photos: Justin Kaneps]
The company also acquired two mobile-based video-editing platforms, Replay (which evolved into Quik) and Splice, for a combined $105 million in 2016, integrating both into a broader vision that Prober describes as a "seamless experience, from capture to share—intelligent systems that recognize the highlight moments of your life and automatically uploads that to the cloud so that it is waiting for you on your computer at home when you open the app."
In demonstrations, the new software package allowed me to offload, pluck clips, edit, play, and share videos rapidly and easily. But will the upgrade fundamentally shift GoPro's business model? "The easiest way of understanding where we are and where we want to be is, up until the launch of Hero5 and Yellowstone, GoPro has arguably been an iPod-like success, but without its iTunes," Woodman says. "Imagine if Apple hadn't launched iTunes? The iPod would be just another MP3 player. Apple [made] it easy for people to consume and manage massive amounts of content." But unlike iTunes, this software comes with a price: $5 a month. Whether charging that fee is another example of greed or rather a smart, strategic expansion of revenue streams remains to be seen.
GoPro is also developing a variety of short-form narrative shows on its YouTube channel, some of them only available on a subscription basis. Sitting at the nexus of social media and high-resolution video has meant that GoPro was, from the start, an entertainment brand as well as a consumer electronics manufacturer, and the company continues to use this to its advantage. (Perhaps only Red Bull has been as successful at marketing itself through creating and distributing action-sports footage.) The GoPro Awards program, which flows free product and massive publicity to amateur GoPro users, has been a successful adjunct to sponsoring athletes, who typically create the best and most-watched videos. Now the company is looking to do even more, by partnering with the likes of soccer team Real Madrid and Moto GP superstar Valentino Rossi and developing original programming set to debut the end of 2017. "We drive revenue in a number of ways," says Ocean MacAdams, vice president of GoPro Entertainment. "From YouTube, from our audience sending us stuff that we can license to other users, and [from] working with [other companies] to create revenue around their brands," such as a recent series produced with Ford around the launch of a new truck. "We'd love people to buy the cameras," he says, "but we also know there are people who enjoy our entertainment program who don't own a camera. GoPro programming is one more way to get them into the ecosystem, and then eventually make a camera sale."
Karma, GoPro's new drone—or, excuse me, as GoPro calls it, "aerial capture device"—is another example of how the company is hoping to lure new user groups. The drone market, according to several analysts who follow the company, is potentially as large as the action-camera market, and faster growing, but it is already dominated by a big player, Chinese company DJI and its flagship product, the Phantom 4. "If [GoPro's] drone is successful, that is one quick route to doubling the size of the company," says Dougherty & Company analyst Charles Anderson. Speculation about the GoPro drone product had been fevered for the first half of 2016, and the company's announcement in April that it would be delayed further hammered the stock. Now, Woodman believes, GoPro has nailed it, unveiling a package that includes a four-propeller drone, a GoPro Hero5 camera, a handheld remote, and a detachable, three-axis gimbal—or stabilization device—which makes the Karma a one-stop solution for image capture, be it terrestrial or aerial. The product is intended to go from its sleek backpack to taking flight within two minutes, the wings and landing gear folding out easily. (Setup and assembly for most higher-end drones, including a Phantom 4, can ruin a Christmas morning.) Pablo Lema, GoPro's senior director of aerial products, insists that Karma is the logical extension of the company's mission of capturing cool footage. "If you think about it, a drone is nothing more than a really, really complicated selfie stick that lets you position it anywhere in the world." From an image-capture standpoint, Karma is a killer camera, due to the combination of the Hero5, that superior gimbal, and the front-mounting of both, a thorny engineering problem that Lema's team cracked. (Consumer drone footage has long been plagued by the visibility of rotors in the corners and sides of the images. Karma's camera placement solves that.) "We're making it easy to get previously unimaginable footage of your life," says Woodman.
But Karma isn't going to win any drone races. It's slower than the Phantom 4—and the foldable Mavic Pro, which DJI launched in late September—and lacks its competitors' Follow feature, which enables the drone to trail the user to capture footage, along with its obstacle-avoidance capabilities and range. GoPro is wagering that the Karma package will entice both the first-time buyer and its preexisting user base, who instead of plunking down $400 for a Hero5 may figure that $1,100 for the whole lot is too good a deal to pass up. (The list price for the Phantom 4 is $1,400.)
"It's as though we've put Hollywood in a backpack," says Woodman. "All of it is super-easy to use. It's so comfortable you will forget you even have it on." The goal, Woodman says, "is to make the drone a part of your experience, rather than making the experience all about the drone." (The dream of many snowboarders and surfers—to have their GoPro hover overhead and nab aerial footage of them during a session—is still a couple of software iterations away, Lema says. "That's a desired use case. We have to make it work really well. We are confident we will get there, and more.")
To get all its new products out, GoPro has been burning through money at a faster rate than at any time since 2010, and finds itself in the third quarter of 2016 with less cash on hand than any other point since going public. It has other brand-new offerings on the market, including a potentially game-changing, $5,000 virtual-reality camera rig, the Omni (made of six Hero4 cameras shooting 360 degrees), along with a VR software-management package. But Woodman will need to demonstrate more attention to deadlines—no more delayed launches—if he wants to prove that the lessons of the past year have really been learned.
Perhaps he'll succeed in creating a "mini Apple," expanding the action-camera enterprise into a digital subscription ecosystem and building a drone business that further integrates the company into its users' lives—and wins over new users outside the action-sports community. But even if the bets on software and flying machines don't pay off, that doesn't mean GoPro will go the way of the Flip. As a simple camera company, GoPro remains hugely successful, pulling in $1.6 billion in 2015. "They don't need to be like Apple," says analyst Anderson. "They just need cameras that are functional, and editing software that is functional. They can be a great company at right around a billion in revenue and pay a healthy dividend and life's fine. But it doesn't seem like that's where they want to go."
"No," Woodman says, adamantly. "We make the best cameras in the world, and volumes are big. But we can be even more."
From robots with human facial expressions to virtual reality cameras, Disney is investing in startups that could be entertainment's future.
Visiting the Disney Studios complex in Burbank is always surprising for an outsider. The company's attention to detail shows up much the same way it does at theme parks: The employees' farmer's market looks appropriately old-timey, and even the flagpoles have historic plaques. But on a recent Thursday, there was a bit of a culture clash when a host of startups, and the venture capitalists who fund them, were crowded in front of Disney's iconic animation building during the Disney Accelerator's Demo Day.
Hanson Robotics on display at the 2016 Disney Accelerator Demo Day earlier this month
Like a lot of large corporations—everyone from Target to Unilever, Disney founded an accelerator of their own a few years ago. The range of startups that Disney (which, remember, owns everything from Marvel Comics to Lucasfilm to ESPN) was supporting at the accelerator was dizzying—and, well, Disneyish.
Hanson Robotics, for instance, makes lifelike humanoid robots with a full range of facial expressions. Jaunt creates cameras for filming virtual reality footage. Playbuzz offers content management systems for online publishers, and LittleBits creates make-your-own-technology kits for children. All of the startups in the Disney Accelerator receive financial and logistical support from the house that Walt built.
The scene was a bit surreal. Disney CEO Bob Iger was posing for photographs just a few feet away from Sophia, Hanson Robotics' uncanny valley-ish demo robot.
Justin Warden, the CEO of e-sports adtech company Ader, was explaining to me how he and his company moved to Los Angeles as soon as he finished school in Amherst, Massachusetts. That was just a few months ago, yet his company, which works on advertising tools for platforms like Twitch, was sharing stage time with some of the biggest names in the tech world.
Two startups gave me insight into how Disney's accelerator works.
Nom is a live-streaming platform for food- and drink-related videos that also broadcasts prerecorded clips and user-uploaded photos. Like other companies in the accelerators, Nom has founders with impeccable bona fides. YouTube cofounder Steve Chen is the company's CTO and CEO Vijay Karunamurthy previously served as YouTube's chief engineer.
Although Nom's on-stage presentation emphasized live-streaming, Karunamurthy was careful to emphasize that the app also shares pre-recorded video and photos when we spoke afterwards.
"'Live' for us means the broader sense of people connecting about something that they're passionate about. Live video is a part of that, but we also think that people having conversations and sharing photos is too. When someone is live, you can ask questions and they reply back to you. Live streaming's great, but there are [more mundane or private] moments where you are having dinner or preparing coffee. There are ways you can share with that audience besides live streaming."
In return for their investment, Disney gets something useful from Nom: a platform that's distinct from Facebook Live, Periscope, or Instagram to promote their food properties. Onstage at the Accelerator event, Karunamurthy announced partnerships with ABC's The Chew and Vice's food vertical, Munchies (Disney has invested $400 million in Vice).
Another startup's experiences at the event showed just why Disney is interested in these smaller companies. Atom Tickets is a newly launched Fandango rival with a massive war chest. Disney, Twentieth Century Fox, and Lionsgate invested $50 million in the company earlier this year.
Ameesh Paleeja, Atom Tickets' CEO, previously worked as Amazon's director of mobile services, and boasted about his company's retail tech abilities when I spoke with him. The company's app is essentially an e-ticketing product for movie theaters with two major differences from its rivals: Users can order concession snacks through the app, and the app also follows up with ticket buyers through push notifications to offer merchandise and swag post-movie.
Ameesh Paleja, CEO of Atom Tickets & Matthew Bakal, cofounder & chairman of Atom Tickets
During his onstage pitch to Disney and investors, Paleeja explained that the company's main strategy was monetizing unsold movie seats. "So far this year, the domestic market has sold nearly a billion tickets grossing nearly 9 billion dollars' revenue. That's not counting what's to come with Doctor Strange, Moana, and Rogue One. That said, each year there are billions of seats that go unsold. If we could fill just 1% more of those seats, it would lead to a billion dollars in incremental ticket sales."
Disney is taking Atom Tickets for its first major test-drive this Christmas: When Rogue One comes out, the app will offer customers the chance to buy movie merchandise alongside their tickets, opening up a new potential way for Star Wars, Marvel, and Disney properties to sell licensed goods.
Listening to the presentations onstage at a theater on the Disney lot, one thought kept registering in my head: All of the startups there were doing things that Disney needs, but that the company's internal DNA isn't necessarily well suited to creating. Disney might not be the best company to create a CMS for mobile content or virtual reality cameras, but it's easy to see how Disney could use them.
Like many other companies of its size, Disney has a strong and unique internal culture. Bluntly speaking, it's sometimes easier for them to invest in small companies creating useful products than to develop them in-house.
This was the third year of Disney's accelerator program; it also featured more complicated companies, compared to prior years. As the entertainment industry marches into a strange new sphere in the late 2010s where mobile is better for ad dollars than broadcast television and virtual reality is ascendant, the question is where the technology goes from here—and how companies like Disney will use the creations they're underwriting.
Take the population of Nevada, site of tonight's debate, then double it—that's how many people considered freelancing full-time this year.
Donald Trump and Hillary Clinton will meet onstage tonight for the third and final debate in one of the most tumultuous presidential campaigns in modern history. Chances are good that they'll be talking about the economy, but the odds are low that either one will touch on one of the most important dimensions of it: freelancing.
One in three Americans have freelanced over the past year, according to the third annual Freelancing in America survey that my company, Upwork, published earlier this month in collaboration with the Freelancers Union. As the New York Times's Binyamin Appelbaum recently noted, U.S. politicians are much more apt to invoke the manufacturing sector on the campaign trail, a habit that "distracts from another, simpler way to help working Americans: Improve the conditions of the work they actually do"—which, more and more, is in the service sector.
Independent work is likely to continue thriving no matter what happens at the federal level in the next four years, but the incoming president can choose either to ignore it or support it. After all, there may soon be political costs for failing to serve freelancers' interests. Our research shows that freelance work generates more than $1 trillion in income for Americans each year, and it also contributes to the growth of small businesses: Those who are self-employed and do well often go on to build larger businesses in their own right. And this is despite the fact that national policies are hardly designed to encourage freelancing.
The survey estimates that 55 million people have freelanced in the last year—more than the populations of Ohio, Pennsylvania, and Florida combined. It found that of those, 13.5 million people are already "moonlighting" as freelancers in addition to their day jobs, and that 37% of them have considered quitting their full-time gigs to freelance exclusively. (If they did, that would add 5 million more fully independent contractors to our workforce—almost twice the population of Nevada, where tonight's debate takes place.)
The data suggests that there'd be many more freelancers if there were fewer obstacles to freelancing. Survey respondents reported that they were confused about the complexity of income taxes, concerned about what to do if a client doesn't pay them, worried about maintaining a stable income, and anxious that they may not be able to get bank loans (or even open bank accounts, in some cases) without a full-time job.
The need for effective policies to support this type of work wouldn't be clearer. With those in mind, here are three ways the next president's administration can address freelancers' concerns and help this sector grow even further.
Our government needs to do more information gathering about the state of freelancers in this country—a need that grows more urgent every year. For any major policy changes to be effective, we'll need more reliable data tracking freelancers' economic impact over time.
The federal government could also be proactive about surveying freelancers to find out what their motivations and interests are. That way the government could help surface resources that assist freelancers with making the transition from full-time employment to working independently.
Efforts like these don't need to mean a major investment of public funds, either. Policymakers simply need to direct more time and attention to these issues, much the way they'd study any other matter of public concern before developing legislation.
Income predictability is the top concern raised by the freelancers we surveyed, and it's no wonder why. Predictability requires understanding your financial situation, having the confidence that you can find work when you need it, and knowing you'll be paid on time for the work you do. All three are areas where the government can help, but the most immediate payoff would be in supporting programs and technologies that make it easier for freelancers to find clients and get paid. Not only would that make current freelancers' working lives more stable, it would also pave a wider on-ramp to first-time freelancers.
In time, though, the government should really dive deeper, investigating other areas like ensuring access to credit and simplifying tax policy for freelancers. The point is worth reiterating: This is work that large swaths of American society are already doing, meaning it's in the national interest to make it easier for them to do so efficiently and productively.
Since 1953, the federal government has run the Small Business Administration (SBA), an independent agency that provides a wealth of support services and information to the country's 28 million small businesses. It's now time for the government to add support for freelancers, too. A good place to start would be the creation of a White House task force on freelancing to better understand the impact the community has on the wider economy, and to evaluate whether expanding the SBA's mandate may be warranted.
As the election heads into its final few weeks, it's unlikely we'll suddenly start hearing either candidate weigh in on the freelance economy. But as a new administration kicks into gear next year, it will be crucial to begin to make the policy changes that can help such a major part of our economy succeed. Doing so wouldn't just be investing in the future workforce—it would be finally acknowledging a form of work that's already here. The longer we wait to play catch-up, the more pressing the need to do so becomes.
Finally, paying heed to freelancers as a national constituency simply makes political sense. The Freelancing in America survey found that an estimated 47 million freelancers describe themselves as likely to vote, with nearly 7 in 10 saying they're more likely to support a candidate who understands their needs as freelancers. Freelancers are listening closely to hear how the candidates' policies would affect them. It's time for the candidates to do a little listening as well.
Stephane Kasriel is the chief executive of Upwork, where he built and led a distributed team of more than 300 engineers located around the world as SVP of engineering before becoming CEO. Stephane holds an MBA from INSEAD, an MSc in computer science from Stanford, and a BS from École Polytechnique in France. Follow him on Twitter at @skasriel.
New features are making it easier to discover events near you, get recommendations from friends, and buy tickets.
It's Friday night. You've already booked a babysitter and are gearing up for date night. There's just one problem: You have no idea what to do.
It's a problem many of us face. We all get caught up with work and everyday life, so when it comes time to actually plan something fun, we're often stuck trying to make last-minute plans that may or may not actually play out. Or worse, we accidentally miss the fact that our favorite performer just happens to be playing at a venue a few blocks away.
Some new Facebook features being released today aim to make the social network more useful in your everyday life, particularly when it comes to planning those big (or small) nights out.
"It's an unbelievably challenging process in 2016 to figure out what there is to go do," says Andrew "Boz" Bosworth, Facebook's vice president of engineering. "This is not a new idea by any means, but I actually think we're almost worse off now than we were even 10 years ago when we first were talking about this, because now it's like a very mobile landscape."
In order for you to make plans to do something, you first need to know that something exists. Local Events is the first new feature Facebook is rolling out, and arguably the first step in making plans using the social network.
With this new feature you'll be able to go to a revamped-up Events tab within Facebook and see what's going on around you—either for that day or any day in the future—tailored to what Facebook knows you enjoy and what your friends are planning on doing.
For instance, my search for what to do this weekend in San Francisco might bring up the Spicy Food and IPA festival going on downtown, something I didn't know about before I came across the Facebook event, but now definitely plan on attending.
When you do find that event, Facebook is making it even easier to go ahead and buy a ticket. Thanks to existing partnerships with Ticketmaster and Eventbrite, many events are already selling tickets directly on Facebook.
Now the social network is taking things a step further, allowing you to do things like order food (thanks to an integration with Slice and Delivery.com), get quotes from businesses, or even request an appointment. Both appointments and quotes are handled through Facebook's Messenger service with the help of HomeAdvisor and MyTime, allowing you the ability to chat with everyone from your local hairstylist to your mechanic, and make appointments directly within Facebook with no need to ever pick up a phone.
For businesses, it gives even the smallest companies a way to have a mobile presence and communicate with their customers online.
Sometimes you already know what you want to do, but you're not quite sure where to do it. Facebook's final announcement Wednesday is a new Recommendation feature. It's been in beta for a bit, so you might have seen it on friend's walls, but the basic premise is that when you're looking for something—for instance, a dinner recommendation for that date night—you can post something on your wall and get recommendations from friends.
You've already probably done that before. The difference now is that Facebook is using artificial intelligence to determine what your friends are suggesting, and then auto link to those businesses' pages in the comments. Even better, suggestions are also populated on a map, so you can easily see that a restaurant is right beside the concert venue you're headed to, or is something you'll likely need to grab a cab for.
And this is only just the beginning.
"The problem is bigger than what we're announcing today," Bosworth says of the difficulty of planning events in the social-media age. "Other products that we're going to continue to work on over the course of the next few months and even years will all fit into this ideal."
An ideal of making Facebook your one-stop shop for planning that perfect evening from start to finish.
Truth of fiction? In these presidential debates, it's sometimes hard to tell.
We kept score as Hillary Clinton and Donald Trump faced off in their third and final debate, moderated by Chris Wallace in Las Vegas. Here are some of the most noteworthy whoppers from both sides.
It's at the crux of Donald Trump's argument that Hillary Clinton is a master of mismanagement: that when she was secretary of state, the State Department lost $6 billion. He made the point forcefully during tonight's third presidential debate. But he's pretty far off-base, according to Snopes, the rumor-checking website. The fact-checking site states that while "an inspector general's report criticized Hillary Clinton's State Department for improper record keeping on $6 billion in government contracts," there's no evidence the department lost those billions of dollars.
That's not exactly right, though Trump did take issue with the television awards back in 2012: "The Emmys are all politics, that's why, despite nominations, The Apprentice never won—even though it should have many times over," he tweeted, according to the New York Times.
Trump attacked the Clinton Foundation for taking donations from countries like Saudi Arabia. The foundation may have a complex set of relationships, but Trump may want to take a look at his own business dealings in the Middle East before pointing fingers. His real estate interests span the region.
Trump might want to recheck his math. Clinton's proposal includes a new 4% surcharge on earnings over $5 million. That change would include some small business owners, such as sole proprietors. But it is designed to serve as a tax on the wealthy individuals, not businesses.
This claim is based on hacked Clinton campaign emails, which include reference to a speech in which the Democratic nominee used that phrase. However, the plan described in Clinton's campaign platform supports border controls and immigration reform. Clinton said tonight that she was referring to energy policy, and not immigration, in her prior remarks.
Seems like these two need to have a serious DTR, stat. "I know Russian well," Trump told Fox in May. Back in 2013, on MSNBC, he more specifically said of Putin, "I do have a relationship… He's probably very interested in what you and I am saying today, and I'm sure he's going to be seeing it in some form." In 2014, Trump said that Putin had sent him a gift. Tonight, in contrast: "I know nothing about Russia."
A close look at ClassPass's plans for global domination raises big questions about the fitness of all-you-can-use subscription services.
Inside a sparse concrete studio crouch a man and woman, both outfitted in athletic attire, buttocks in the air, hands on a black sandbag, preparing to push the heavy sack across the length of a long foam mat. "Go! Go! Go!" a trainer yells, beckoning them to begin the workout. For $38, exercise masochists can spend an hour throwing weighted balls at a ceiling and haphazardly climbing over tall walls at Brooklyn's Warrior Fitness Boot Camp studio. But for those who don't want to plunk down that much cash for an army-drill inspired workout they're not sure they can finish, there's ClassPass—a three-year-old service that, for a monthly fee, connects fitness novices and workout junkies with a wide range of boutique exercise classes at a discounted rate.
Founded by Payal Kadakia, ClassPass has raised $84 million from investors like Google Ventures and Thrive Capital. With services in 36 cities around the world, it is one of the most prominent of the subscription plans that have emerged in the last several years. The allure of these new subscriptions is they automate would-be chores. You can now schedule a box full of goods to arrive on your doorstep monthly and eschew a drive to the store for basics like paper towels and face wash. The subscription model has also become a tool for organizing monthly activities like getting your hair styled or going to the gym, and has created a market around quickly scheduling the hours of your day.
But as ClassPass has expanded over the last two years (and even imagined branching into other kinds of activities like museums and movies), the company has substantially raised the cost of its popular pass, alarming some its rabid fan base and raising questions about its model. At the start, ClassPass's New York City users paid $99 a month for unlimited fitness classes. Then, in 2015, it raised its price to $125 a month. This past summer, that number jumped to $190 a month for unlimited classes. The surge, designed to fatten margins, cost ClassPass 10% of its users, according to TechCrunch. An internal company document from January 2016 detailing ClassPass financials for all of 2015 was leaked to Fast Company and reveals that the company faced difficulty bringing in enough revenue to outpace the cost of paying class providers, like the dance studios and gyms that ClassPass partners with. While it seems the company has, at least for the time being, stemmed some of its operating costs, its difficulties have cast doubt over the ClassPass model as a viable—and repeatable—formula for long-term success.
Related Video: A Hard Look At ClassPass, Highlights Problems For Activity Subscriptions
This business model is complicated to get right, in large part because a company has to identify a pricing structure that pleases both customers (who want it to be as low as possible) and service providers (who want as high a cut as possible), while cutting itself a portion of sales. ClassPass makes its money from memberships; the exercise studios it partners with make money from ClassPass, which pays those facilities a discounted rate for every ClassPass customer who signs up for a spin class or barre session.
In 2014, ClassPass offered unlimited classes for $99 per month—a great value for active customers who want the boutique fitness experience (a traditional single-gym or single-studio membership can cost anywhere from $10 to $300 a month in New York City). Frequent class-goers could significantly drive down their cost per class on otherwise expensive boutique classes by going to lots of classes. Spreading $99 across an entire month of daily classes equates to paying $3.30 for each individual class, if a power user takes a class every day. The opportunity to save money on workouts and the ability to book classes through ClassPass's well-designed app lured a lot of customers onto the platform. But as time passed, it became increasingly clear that while this flat-fee subscription rate was great for onboarding users, it wasn't good for ClassPass's overall business.
Subscriptions have to be priced in such a way that they cover the costs of the service. Earlier this year, when ClassPass dramatically (and controversially!) increased its prices from $125 a month to $190, it also introduced two new tiers of pricing: five classes for $40-$75 and ten classes for $89-$125, depending on the location. Some regions still have access to its original $99 unlimited subscription, but in major cities like New York, Chicago, and Los Angeles, ClassPass had to hike up its prices. "For the majority of users, a 5-plan or a 10-plan is actually a cheaper proposition," says ClassPass founder and CEO Payal Kadakia, reasoning that it's cheaper than the $125 per month customers were paying before.
The company negotiates contracts with each of the fitness studios in its database of classes, agreeing to pay a percentage of the full class price per ClassPass customer who signs up. ClassPass charges customers a flat monthly fee for access to these various classes, which is how it generates revenue—but because it pays studios a fee every time a customers takes a class, how much profit ClassPass makes or loses in a month depends heavily on how many classes each customer decides to attend.
Over the course of 2015, ClassPass stoked monthly revenues from $3.4 million to $9.1 million, taking in roughly $86 million in revenue for the year total, according to the internal document reviewed by Fast Company. But operating costs stood in the way of consistent profitability. ClassPass started 2015 off with a monthly net loss of $2.8 million. At the end of May, those losses had mounted to $7.2 million per month. The company was turning over between $8.5 and $9.5 million every month to its partner venues for the majority of the year. Plus, it had mounting software costs, which Kadakia says were attributed to an increased investment in its engineering department and its new products, though she declined to go into detail on exactly what those encompassed.
In the second half of the year it appears that ClassPass was able to stem costs (perhaps partially through its first price increase), so that by December it was generating a 6.5% monthly profit. But in January 2016, costs jumped back up, leaving the company with a $1.5 million loss for the month. Fritz Lanman, an early investor in ClassPass, says that the January bump in costs is a seasonal consequence of the model.
"In January [gross profit] won't be as high because that's when everyone is working out," says Lanman. (Health-conscious New Year's resolutions are thought to inspire people to sign up for new fitness services.) The more people who work out, the more ClassPass has to pay its partner studios, and the less money the company makes. In other words, the ideal ClassPass user, from the company's perspective, is someone who doesn't work out too much.
To get this middleman role right is an arduous task. It depends on selling consumers a product they must value enough to sign up for, but won't fully use. Then ClassPass has to somehow convince these types of customers that its product is still worth the monthly fee, even though they're not really using it at its full value. On top of that, ClassPass has to strike deals with venues that allow it to earn a profit, while also making the venues feel like being a part of ClassPass is earning them more too, by filling up otherwise empty spaces in their classes. So while ClassPass has leveraged the subscription component of its business to spin up lots of new customers, a good consumer acquisition tool itself doesn't equate to a scalable business.
"These [activity subscriptions] startups face the difficulties of managing provider relationships, attracting a wide enough network of studios to bring in customers, and passing on a proportion of revenues to the studios," writes Zoe Leavitt, tech industry analyst at CB Insights, in an email. "They also face the danger of becoming a victim of their own success—studios may worry that if the subscription service gets too popular, it will overtake their own business," she adds.
That said, not all subscription services are bad business. Some subscription ventures have secured big exits. Over the summer, Dollar Shave Club, a box-subscription that sends monthly shaving supplies to customers, sold to Unilever for one billion dollars. Yet others are wrestling with profitability.
"In contrast, the well-known Birchbox, which supplies customers with third-party samples, has struggled recently," says Leavitt. Birchbox, a subscription service that sends sample boxes filled with packets of lotion and petite tubes of lipstick to your door, was riding high in mid-2014 with $60 million in investor funding, the opening of a brick-and-mortar store, and promising metrics showing a chunk of its sample-box subscribers were returning to buy full products. This past June, Bloomberg reported the company had laid off 45 of its 300 employees and was in need of a reconsidered approach to its business.
What separates successful subscription companies from flailing ones may be a matter of the kinds of products they're pushing. Subscriptions like The Honest Company, which send "bundles" of its branded products to monthly subscribers, tend to do well, says Leavitt. What differentiates Birchbox from some of its box-subscription contemporaries is that Birchbox isn't selling its own products via subscription. It's using the subscription to introduce customers to a bevy of beauty samples, the way an old-fashioned beauty counter might, in the hopes that they'll eventually buy full-size products later. This managed to accrue a subscriber base, but the subscription was not supposed to be the main source of revenue. It was primarily a way to get customers hooked on a product and eager to buy it regularly at full size on Birchbox's website, rather than a mechanism for triggering a steady supply of revenue. This is where subscriptions get tricky. "It's hard to carve out margins as a middleman, and we've seen that most of the subscription startups with the most momentum have been those that sell their own branded goods—like Dollar Shave Club, Harry's, and Peloton," says Levitt.
ClassPass CEO Kadakia says the profit losses were all a part of a big plan to grow the business. In 2015, as an answer to rapidly spawning competitors, ClassPass decided to go for hyper-growth. In the U.S. ClassPass was up against Fitmob and FitReserve; in Australia it was ClassHopper, Kfit, SweatPass, and Bodypass; in the U.K. it was Somuchmore. Kadakia remembers seeing one of these "copycat" websites for the first time and feeling the need to scale ClassPass quickly in order to lay claim to the subscription-fitness idea. "We're going to go fast and we're going to go hard," she recalls thinking, sitting comfortably on a gray couch in one of ClassPass's living-room-esque conference rooms at its New York headquarters. "This is our product to protect."
Last year, the company pushed its subscription platform out to 36 markets, including cities in Australia and the U.K. In April 2015, it also acquired Fitmob. The ramp-up helped lead ClassPass to a $17 million loss for the year, though as of January the company still had $25 million sitting in its coffers from previous funding.
Rapid expansion also took a toll on the company's workers, and Kadakia reached her personal limit trying to run a 200-person company. She says at a certain point last year, she realized she needed help. So, in December 2015, then-executive chairman Lanman became ClassPass's co-operator. An internal source says Lanman took over day-to-day operations despite running two other companies, Doppler Labs and DWNLD.
"The skill that she has, that very very few entrepreneurs have shown, is an ability to create something new that appeals to the zeitgeist," says Lanman. "It's hard to do this well, so we wanted to focus more of her energy on that." What Kadakia had finally hacked was getting people to sign up and go to fitness classes, a hurdle she couldn't clear with her two earlier products, Classtivity and Passport. But getting people to exercise came at a cost, and the company needed to make adjustments accordingly.
With Kadakia focused on creative endeavors this year, Lanman fleshed out ClassPass's executive ranks. He worked closely with the company's interim COO, Steve Wietrecki, who was with the company throughout 2015. Rather than hire a full-time COO, Lanman brought on a new CTO, former Amazon customer experience exec Sam Hall, and a new CMO, Joanna Lord.
Simultaneously, the company began tightening its belt. Since April, ClassPass appears to have had two rounds of layoffs, according to inside sources. Data from LinkedIn reveals a string of 15 to 30 people left the company between April and June. The staff cuts came as the company was taking other measures to get lean. It purged many of its internal perks, including free memberships and catered lunches for employees, according to former staff. Around the same time, ClassPass announced its price increase.
"It's hard to create a flat rate," says Matt Dibb, founder of ChildPass, an Australian ClassPass clone focused on activities for kids. While he watched ClassPass's early success, Dibb didn't do much investigation before embarking on a similar product. He says the most difficult part of creating a children's activity pass was developing a consumer acquisition strategy: making the subscription affordable enough to entice consumers, while also charging enough to cover the cost of the actual class. It was so hard to make work that Dibb pivoted his business and now sells a scheduling and payment interface for children's class providers.
For ClassPass, on the other hand, the flat-rate unlimited subscription was great for nabbing new customers quickly. Like an all-you-can-eat buffet, the value proposition is obvious. "The one-size-fits-all model worked really well in that it made the sale simple," says Lanman. But since the $99 rate also attracted exercise fanatics (those who were taking so many classes it was reducing their individual costs per class to less than $10),the price change may have been aimed at churning some of these power users out.
The initial price move, from $99 to $125 in July of 2015, did lead to a loss of subscribers, but its hard to tell how many. Revenue alone won't indicate how many people left, because pricing is not uniform across markets. While all of ClassPass's cities experienced a price increase, some saw smaller increases, from $79 a month to $99 a month as opposed to $99 to $125. (Creating another layer of complexity in understanding ClassPass's metrics is that existing subscribers didn't have to start paying the new subscription price until two months after the announcement.) However, an examination of ClassPass's financials shows that revenue growth rate sunk from 11.4% in July to 2.67% in August. Growth stayed slow until November when it dipped to negative 2.4%.
The initial price raise wasn't enough to offset ClassPass's costs. It also wasn't helping to bring on new customers. "We realized it wasn't going to work," says Kadakia. The unlimited pass, along with seasonality, new product launches, and other variables made determining both revenue and costs month to month an onerous process, she says.
For instance, a lot of people hit the gym harder in January, but workout binges and hiatuses are not the same for all customers. "No business is good when on the last day of the month you're like, what was the usage for the month?" Kadakia explains. "There was such variability in terms of what our margin would be based upon, what the usage would be, and so what we wanted to do was stabilize that."
This realization preceded the next price increase in April 2016, this time in multiple price tiers, which sought to make ClassPass's month-to-month financials more predictable by capping the number of classes included in some of the offered plans. Kadakia and Lanman also wanted to figure out how to appeal to a crop of fresh users who weren't already familiar with the cult of Pilates, spin, and Pure Barre. They thought a $40-$65 per month 5-class pass might pique users' interest without intimidating them. "It's just a more balanced business model and it did strengthen unit economics across all our different customer segments and demographics," says Lanman. He says it also offered a better deal to those who were paying for unlimited classes and only going to class a few times every month.
But even after reestablishing the prices of its passes, ClassPass still has to contend with the cost of the classes themselves. For the majority of 2015, the cost of venues alone was still outpacing incoming revenue from subscriptions and missed class fees. In the last three months of the year, the company was able to grow revenue just above the amount it was paying out to fitness studios. But then, in January 2016, venue costs jutted upward, surpassing revenue.
The ups and downs reveal a core issue with ClassPass: Its business is unpredictable. Kadakia and Lanman, who often finish each other's sentences in conversation, say they can't foresee how much people will use their pass, even with the data they've amassed. There's a big difference in margins between a frequent user and an occasional one. While they know that every month class-goers will miss classes and have to pay a fee, they can't really know in advance how many people will do that. The tiered pricing is meant to introduce more certainty to the company's finances, by limiting a customer's ability to drive down their own class cost. More robust data analytics may also take some of the guesswork out.
But ClassPass's margins can still be pretty thin. For example, if someone is using their 10-pass to the fullest extent, they're paying $12.50 per class. To turn a profit, ClassPass has to pay the studio less than $12.50 for that same class. It may be difficult to convince studios who charge upwards of $20 a class to let go of their inventory for less than 60% of the purchase price. Even though the service's unlimited tier (now $190 per month) is significantly more expensive than it used to be, it's still not enough to cover the the costs of a dedicated super-user. While plenty of customers may not use the pass that often, delivering ClassPass better returns, ClassPass subscribers tend to go to class more over time, not less, says Kadakia.
That's why ClassPass may be phasing out unlimited altogether. If you try to sign up for ClassPass in major metropolitan areas like New York or Chicago, you won't see the unlimited subscription plans, only the 5- and 10-pass options.
Other activity subscriptions are slowly backing away from unlimited passes, too. Vive, an app for scheduling salon-style hair washing and drying, launched with a $99 unlimited pass. Now, the app offers $69-, $159-, and $239-a-month memberships guaranteeing members a set number of blowouts. In the new system, the cost per appointment can't be driven below $29. MoviePass, which originally allowed users to see one movie per day for $25-$40 per month, also switched from a cheap all-access pass to a tiered system. In every case, the new pricing model is set up to cover costs that the unlimited subscription model wasn't supporting.
ClassPass says its experimenting with its homepage to see which plans perform best in attracting new customers; the company hasn't decided whether it will ditch the unlimited tier or not. Even with unlimited gone, Lanman and Kadakia don't seem convinced ClassPass's current manifestation is necessarily tenable.
"We're not feeling financial pressure," says Lanman over the phone. "But we do obviously want to make sure that it's sustainable and I don't think we can commit to that because we don't have enough data yet." To his point, Business Insider reported that the company has a $150 million run-rate for 2016
as well as a 17% gross profit margin. Layman confirmed that gross profit margins are sitting around 20% month-over-month. ClassPass's thicker profits margins are likely the fruits of its cost cutting and subscription price increases. But its fast growing revenue may be a short term success. Lanman acknowledged that even with the new tiers in place, if people use all of the classes allotted in their subscription, ClassPass doesn't make a profit. The question will become, if people really do use the pass more over time, how will the company sustain itself? And if people continue to underutilize the pass, how will ClassPass be able to prove to those customers that its worth the expense?
In the meantime, ClassPass is developing some new products that might further help its bottom line. For instance, Kadakia says the company is experimenting with using dynamic pricing to determine how much it should pay studios for the classes they can't sell through regular channels. In the future, using the data it has accrued over the last three years, ClassPass might pay studios different rates for classes depending on time of day and the likelihood of those classes being filled. To build out customer offerings, ClassPass is starting to offer those who want more than three classes at a specific studio an opportunity to purchase more classes through its network.
ClassPass has had to build technology to help many of these fitness studios track class inventory, explains Kadakia, and the company is open to creating more products for fitness studios. It's recently launched a product called "smart spot," which is an algorithm studios can turn on to automatically release class spots to ClassPass based on historical data.
"I think we can do a better job, as Payal alluded to, helping them with better customer service, give them more CRM tools," says Lanman. Embarking more deeply into services for its venues could be a wise move. ClassPass's relationship with its studios hasn't always been particularly solid. As Jenna Wortham's 2015 story for the New York Times showed, studios see the service as a good marketing resource that draws in more customers, but one that inherently devalues their product. Some studios have watched students with monthly memberships defect to ClassPass because it offers a better deal. Why pay $175 each month for access to a single studio when you could pay $125 a month for access to a multitude of studios? Building more tools for studios, and doing away with unlimited plans, could certainly help to bolster ClassPass's relationship with studios.
Currently, MindBody is the biggest player in a market that sells software to boutique fitness outlets for scheduling appointments online, managing staff, and offering a point-of-sale system. But there's room to compete and ClassPass may be wise to do so. MindBody has already rolled out its own ClassPass-like app called "Connect." If ClassPass could develop business-management tools for fitness studios, then it might be able to profit enough to justify the expense of its subscription business.
That approach is similar to the one that Australia-based ChildPass pivoted to, and so far the company says it's working for them. The company now offers an interface through which class providers can sell classes, but without subscriptions. It also provides those teachers and studios software with which to manage their businesses.
This isn't as sexy as some of the more consumer-facing product ideas ClassPass has dreamt up. In April, Vanity Fair revealed a leaked pitch deck from ClassPass describing something called "LifePass." The big vision appeared to be to build out ClassPass to include access to museums and other activities.
Neither Kadakia and Lanman would confirm the Life Pass idea, except to say ClassPass is continuing to explore other classes it can add to its roster. For example, Kadakia says she's looking into a gym pass that would give users access to a variety of gyms. She's also thinking about activities outside of fitness. Already the company has experimented with offering massage, Daybreaker parties (booze-free early morning raves), movies, and dance shows on its app, says Kadakia.
Meanwhile, Kadakia continues to beat the drum for expanding the subscription. "People use our app to book the daily hours of their life," she says. "I think we've done that with the amazing space of fitness, and for us it's about what else can we apply that to." In line with that thinking, the company has rolled out a new home screen that will present users with activity suggestions based on activities they've chosen in the past, what people who have similar tastes like, and their present location.
Whatever direction it goes in next, it will be with an eye toward financial sustainability, Lanman says. "We're going to get a lot more data about behavior change and that's going to end up predicting what we do next."
Both Kadakia and Lanman have a phrase they use to talk about growing the company, which involves "earning the right to work on the next thing." To work on new products like the one Kadakia envisions, they say, they must prove the business is ready for it.
The 14-year-old networking service Meetup was doing just fine—until a employee-led coup jolted it out of complacency.
On a spring day last year, Scott Heiferman, cofounder and CEO of the New York–based networking service Meetup, gathered a group of about 50 colleagues in a capacious bar in Red Hook, Brooklyn. It was the final afternoon of a two-day off-site. In previous sessions, employees armed with whiteboards and markers had discussed ways to boost user growth and solve pain points for their 28 million members, who use the service to start and join interest-based groups that host everything from cocktail hours to writing workshops. As the meeting drew to a close, Heiferman was expecting more brainstorming. His employees, however, were about to stage a coup.
Change was already afoot at Meetup: In previous months, Heiferman had replaced his VP of product and expanded the design team from one to six members. But for a segment of his workers, that wasn't enough. As the off-site attendees broke off into groups to discuss topics they'd scribbled on Post-its days before, Brian Lafayette, Meetup's strategy director, slinked over to designer Farah Assir, who had joined Meetup two months earlier from the New York Times.
Assir and Lafayette had spent the past few weeks commiserating over after-hours drinks about Meetup's growing irrelevancy. The service, they believed, had lost its mainstream appeal. If you wanted to make friends with, say, fellow ferret owners in Houston or catch up with the Danglers, a SoCal nudist club, Meetup was great. But why did the service make it so hard to find activities tailored to more conventional tastes? Lafayette worried that people saw the site as "only for weird people without friends." So he nudged Assir over to a table with two other employees to discuss the note he'd jotted on his Post-it: "What if the cool people were on Meetup?" They emerged 45 minutes later with a challenge for their CEO: Make some quick changes to appeal to broader and younger audiences, or Meetup is going to get left behind.
As they presented their critique, colleagues rallied around them. Others glanced nervously at Heiferman, who sat shaking his head. The 44-year-old founded the company 15 years ago with a mission of creating communities for everyone, no matter how niche their interests. Now his employees were telling him Meetup was out of touch. "Great, perfect, because we don't want to be cool," Heiferman recalls saying. "If you're cool, you're a fad."
The CEO left the meeting angry, but Lafayette and Assir's comments lingered with him: "I said to myself, If I'm so bothered by this, there must be something to it." Though Meetup was successful (users grew by 20% from 2014 to 2015; revenue increased 30%, thanks in part to a fee hike), it had missed several crucial waves of innovation, including the shift to mobile. Three years ago, it finally allowed organizers to schedule events from within an app, which still lacked the geolocation features exploited by services such as Tinder. Meanwhile, Facebook beefed up its efforts to help its more than 1 billion users connect in person, making it easier to search for events by category and location (see Circle of Friends, for more). As Heiferman clung to his self-described "hokey" tenets of community and inclusivity, the market had evolved around him.
After a couple of weeks of thinking (and stewing), Heiferman initiated a series of meetings to develop the upstarts' challenge into actual change. (The calendar invite for the first meeting was pointedly titled, "Cool.") The leadership team brought in Meetup organizers and members from other cities, getting their feedback on the service. They realized that part of Meetup's problem—along with the fact that it had never employed a marketing chief to help keep its brand current—was their users don't care much about joining a community. They just want to find things to do. But Meetup was centered on groups: Members had to file requests to join them; some groups even had lengthy questionnaires and rules. That made it difficult to draw in users. "The platform was very much [focused on] people asking to be a part of things," says Lafayette.
Meetup with the team:Scott Heiferman, cofounder and CEO, Strategy director Brian Lafayette, and designer Farah Assir.
The team decided to reframe the service around activities and, at the end of September, introduced a redesigned app. Instead of an endless scroll of suggested groups, users now see nearby events that match their interests—go party with Free & Cheap Culture & Night Life, get feedback on a novel from the Shut Up & Write! group—which they can add to an itinerary. The app also surfaces activities that others are interested in, so users can decide if they want to set up an outing. The company is now developing features like "nudging," to spur one-on-one conversations at events, and group messaging, so that attendees can discuss logistics and keep in touch afterward. Instead of searching for communities, Assir says, "You get to say, 'Here's what I want to do,' and meet [like-minded] people along the way."
Heiferman has embraced Meetup's transformation. He's currently in the process of hiring a marketing executive and has even updated the logo from a dorky name tag to a more stylish-looking m. But he'll never give up on its feel-good, arms-wide-open founding principles. "The future is more automated meetups," he says. "Humans will provide the caring and love and support." The technology is just there to help.
The games, available to League Pass subscribers, will have multiple camera angles and dedicated commentators.
From just an experiment one year to full-fledged product the next—the NBA is all-in on virtual reality.
Last year, the league broadcast one of the first-ever live VR streams, the then-defending champion Golden State Warriors' opening night game against the New Orleans Pelicans. It, along with other games streamed live last year in VR, was a test. Today, NBA Digital announced it will live-stream a game a week all season, formalizing its commitment to the technology. Those games, starting with the Sacramento Kings against the San Antonio Spurs on October 27, will be made available for free to anyone who subscribes to its League Pass service.
As a result of a multiyear partnership with leading virtual reality production company NextVR, the league will broadcast one game a week, featuring each of its 30 teams at least once over the course of the six-month season. The broadcasts will feature multiple VR camera views, replays, and graphics, and dedicated commentators and analysts who will aim to help fans have the best-possible experience watching a basketball game in VR.
NBA Digital will announce the schedule of games next week. It isn't saying yet whether it will extend the VR broadcasts into the playoffs next spring.
"We think this is the biggest commitment of virtual reality content" by an entertainment company, Jeff Marsilio, NBA Digital's vice president of global media distribution, told Fast Company, "outside video games."
Marsilio said the NBA first began playing with VR in 2014, and by the fall of 2015 had moved on to its stream of the Warriors' opener. But the league knows that being a leader in virtual reality means diving in even deeper.
"If we're going to move innovation forward," he said, "we need to [do more] and make sure that every time we do this, it's getting better."
During last year's Warriors broadcast, NextVR shot video with a single camera installed courtside. Now, said Brad Allen, NextVR's executive chairman, there will be between four and six cameras set up at each of the games. Along with on each side of the court, there will also be one providing a bird's-eye view.
Plus, Allen said, "everybody loves having cameras in the stanchions right below the backboard, so you can see the players coming down the court, and Steph Curry's shooting a three-pointer, or somebody's making a dunk."
Presented with multiple camera views, viewers will be able to choose which one they want to see and switch between them on command. They'll also be able to see a replay of any play they want.
In the early going, viewers will need a Samsung Gear VR to view the live broadcasts. Marsilio said the plan over time is to expand to other virtual reality platforms. Google's Daydream, which it will launch next month, is "absolutely one of the platforms I do expect us to be on," he said.
In its previous public experiments with VR, the NBA has relied on traditional commentary from its TV broadcasts. But the league is aware that watching a game in virtual reality is different. Fans may need some help knowing where to look, or to have their attention diverted to something particularly worth noting.
"It helps," Marsilio said, "to have someone dedicated to the VR broadcast [who can] introduce different elements. . . . We've found people will watch a live stream without these elements, but that the time [they'll watch] extends when you provide these contextual elements."
He did note that while professional basketball commentators will be the ones providing color and analysis during the VR live streams, it's going to be a learning process for everybody since no one has really done this at any kind of scale before.
NextVR, which has broadcast everything from presidential debates to concerts and many sporting events in VR, has included dedicated live commentary in some of its previous sports broadcasts, like a German soccer match, but hasn't done it repeatedly and on any kind of regular schedule, Allen said.
The Southern California company has been on a hiring binge recently thanks to having raised $116 million in venture capital. It currently has 70 employees, Allen said, and now has its very first VR production truck that will "roll up" to event venues much like those for traditional TV.
"Hopefully we're solving one of the big questions about VR," Allen said, "which is [whether there's] enough content, and compelling content, out there [and] to know there's a regularly scheduled game once a week."
IMPACT asks players to think like futurists—anticipating change, responding to unforeseen events, and living with uncertainty.
Other than a brief chat with a college career counselor, or that time a family member asked what you wanted to be when you grew up, has anyone encouraged you to look into the future? Were you ever formally taught how to develop your capacity for foresight? Me neither.
A new game called IMPACT, by the innovation and design firm Idea Couture, wants to change that. Given how rapidly the workforce is evolving—not to mention life's inherent uncertainty—IMPACT's creators felt it might be useful to help people sharpen their ability to anticipate and respond to unexpected change, especially when it comes to their careers.
A lack of foresight might have been less of a problem when people remained in the same job from rookie stage to retirement. But the need to navigate more dramatic and frequent career shifts is becoming both more widespread and more urgent, and that's something many of us may not be all that well-equipped to handle.
To combat that, IMPACT wants to train you to think like a futurist. It's designed for groups of three to five players (though up to six can play), and it's arguably best suited to people ages 16 and older.
To begin, each player chooses a card that outlines their persona for the duration of the game. All are meant to represent a knowledge worker from the future workforce—someone who helps customize prescriptions for patients; uses social-media mining and systems thinking to assemble distributed teams; or develops living spaces, transportation solutions, and health innovations to make space travel more feasible for humans. And each persona card includes a set of optimal conditions for exercising their skill sets.
In each round, a player draws an "impact card" describing a technological breakthrough that may shake up their career prospects—for good or ill. Every player then has to react to its impact by adding or subtracting "influence cubes" to the game board, which covers 10 "domains" (agriculture, energy, transportation, etc.), only three of which are relevant to each character's "preferred future."
IMPACT asks players to imagine themselves as knowledge workers in the not-so-distant future, adapting to unexpected, tech-driven changes.
At the end of each round, players have to write a short headline characterizing the "era" that the changes unleashed. To win, a player needs to become the first person with the correct number of influence cubes on all three of their domains, signaling that they've secured their persona's future career, even as it's buffeted by unexpected events.
As Elaine Cameron, resident futurist and senior director of the FUTURE Perspective Group at the public relations firm Burson-Marsteler, explains, "One of the things futurists learn to be comfortable with is a degree of uncertainty. What we are equipped to do is to track signals of change, anticipate the direction of travel, and imagine possible scenarios that could evolve"—all skills that IMPACT is meant to sharpen in players. "That way you have some kind of plan in place should any of those possibilities become reality."
Cameron recently contributed to IMPACT's Kickstarter campaign, which exceeded its target of $15,000 CAD earlier this month. It's now fully funded and entering production, with Idea Couture taking preorders (at $65 USD) and pledging to donate 25 free copies to educators.
"Our goal with the game," says lead designer Robert Bolton, "is to train people to think more deeply about what could unfold in the future, including opportunities to discuss how emerging technologies will fit into our culture and how we will use them." As Cameron points out, that's something few of us know how to do systematically. Idea Couture's CEO Idris Mootee agrees. "Foresight is a toolkit for handling complex, discontinuous, and rapidly changing conditions," he says. "Its methods are invaluable for identifying opportunities on the horizon."
This kind of higher-level thinking isn't exactly a new idea. In 1956, educational psychologist Benjamin Bloom developed the pyramid-like hierarchy of cognitive abilities known today as Bloom's Taxonomy. Despite that, the way most students are educated still focuses on lower-level faculties like knowing, understanding, and applying information in different contexts. But it's really the higher-order stuff that matters—and will matter even more. To compete with artificial intelligence and work alongside machines, the ability to synthesize new ideas quickly will likely prove more decisive.
I recently asked some volunteers to give IMPACT a spin. One was Debra France, a corporate educator at a global innovation company. In one round, France was faced with four cards describing real-life technological breakthroughs in green jet fuel, cheap spray-on solar cells, fuel-producing plants, and biomedical implants that can bond with human cells. While only some of these eco-friendly innovations worked to her persona's strengths, and she won bonus round at the end of the game by coming up with the "era" headline: "It's now easy being green."
Afterward, France said she had a strong sense of the game's real-world applications, including "for young people in STEM programs," because it pushes players to consider "a broad range of possible future jobs that could help them decide which science or technology to pursue." Many of these roles, France felt, are hard to imagine in the abstract but easier to envision when you're presented with specific technological developments, then asked to adapt to them.
"The fact that players take on roles that may or may not align with their values," explains Robert Bolton, IMPACT's lead designer, "helps them see things from different perspectives. The skill involved in taking multiple cards and undertaking a brief cross-impact analysis to create a relevant headline is not easy." In fact, says Bolton, "We've found it to be especially challenging for those with engineering and business school backgrounds. Playing IMPACT requires you to think more like a novelist: Who are the characters? What's it like to live here? What period is this?"
Indeed, another way to hone your anticipatory skills may simply be to pick up an actual novel. New America Future Tense Fellow Jamie Holmes believes reading fiction is a good way to get better at handling the kind of ambiguity IMPACT is designed to teach—"partially because it's safe, and you go into this other world," Holmes says, but also by "broadening our categories, because we're thinking about how other people make decisions."
Before long, we'll be those futuristic personas, navigating complex technological breakthroughs. Better get acquainted now.
Liz Alexander is a consulting futurist and cofounder of Leading Thought. She partners with individuals and organizations globally to help future-proof careers and businesses. Connect with Liz on LinkedIn and follow her on Twitter at @LeadThought.
The conglomerate, now moving into the U.S., claims to be everything—Apple, Tesla, Netflix—but it most resembles the online retail giant.
Danny Bowman has a tough job that he seems to relish—explaining to Americans a company from the other side of the globe that insists it is like no other company. That's been his task since February, when he left Samsung Mobile and became chief revenue officer at LeEco, the omnibus Chinese tech and media company that formally celebrated its entry into North America with an exhaustive exhibition in San Francisco this week.
With a shaved head and graying goatee, Bowman is middle-aged but very fit, with muscular arms stretching the sleeves of his black LeEco T-shirt. Wearing jeans, he has a casual manner not uncommon in Silicon Valley and similar to the LeEco's founder and CEO, Jia Yueting, who was dressed almost identically onstage with him.
LeEco's Danny Bowman, just after the company's big party. [Photo: Sean Captain]
After an hour and a half of presentations by Jia, Bowman, and many of their colleagues, I asked Bowman to sum it all up with LeEco's elevator pitch. "Apple, Samsung, Google, Tesla, Uber, Netflix, and Paramount Pictures—we're a little bit of all of those," he says. That's quite an ambitious claim, but LeEco is certainly diverse, encompassing TVs, smartphones, a bicycle, a car, a movie studio, cloud storage, ride-sharing (in China), and an e-commerce site, among other ventures.
The company began in 2004 as LeTV.com, an online video streaming service. ("Le" comes, not from French, but from the Chinese word for happiness.) From there, it spread into original content creation and then into making smart TVs—a lot like Netflix, which spun off its video device business as Roku. Jumping into smartphones in 2015 wasn't a big stretch for a TV maker. (Vizio, which LeEco purchased in July, made a foray into smartphones in 2011.)
But an autonomous electric car and a carbon-fiber hybrid bike? "There will be more connected cars than non-connected cars by 2020," says Bowman. "The vehicle is literally another part of the internet," he says. The company's bike is also online, with a 3G cellular connection for GPS, exercise data uploads, and an online finder feature if the bike is stolen.
LeMall is a company store now but might grow into something broader.
"The real key to all of this, we're an internet and content first company, and we try to created a very unique experience," he says, "and for that to happen, that's why we do vertically integrated hardware," says Bowman, claiming that no one else does this. When I mention competitors like Sony, which owns a movie and TV studio, a record label, the recording devices that capture video and audio, and the consumer electronic devices that play them. Bowman is unimpressed. "It was a very hardware-centric approach, vs. an internet content experience approach," he says.
"The American company example is Amazon," says Bowman. "They've done a lot of different integrations, a lot of disruption." LeEco also has an e-commerce site, called LeMall.com. In a way, it's just like Apple's online store, selling the company's own main hardware and accessories. But LeEco seems to have more afoot. In San Francisco, it announced a membership program called EcoPass that entitles members to discounts, unlimited photo and video storage, extended warranties, and unlimited video viewing, among other perks.
EcoPass is included with purchase of a TV or smartphone for from three months to a year, but Bowman says that it could evolve into a paid annual membership, like Amazon Prime. Bowman also promises a "disruptive" system of content partnerships, debuting on November 2. It may make LeMall more of an online content source.
LeEco even has its version of Amazon Web Services, an online storage and computing resource called—what else?—Le Cloud. Amazon comparisons fade when it comes to artificial intelligence, though. The American giant uses sophisticated algorithms to customize its experience to users, who increasingly interact with Amazon through its Alexa voice service. No problem, according to Bowman. "I would tell you, anything around the internet that's related to AI, machine learning, software-driven approach, big data, you're going to continue to see us evolve," he says.
Here, four startups with the capital and ambition to remake U.S. health care. May the odds be in their favor.
Eager to leap in where so many others have stumbled, Silicon Valley investors have been pumping capital—$1.2 billion in 2015 alone—into startups taking on the task of improving health insurance for individuals and employers. It's not for the faint-hearted: The industry is rapidly consolidating, making it harder for new companies to gain traction. But the payoff could be huge. "It's a big, juicy opportunity with a lot of market cap," says Sequoia Capital's Mike Dixon. Here, four of the biggest bets on the future of health insurance.
What it is: Insurance-plan marketplace with concierge-style services for individual buyers.
Big idea: Make it pleasant and efficient for users to find plans that meet their specific needs.
Secret weapon: A well-designed app that translates insurance lingo into layman's terms and helps users buy a plan in under 20 minutes.
Members: 125,000 in 50 states, plus D.C.
Biggest hurdle: Federal and state insurance exchanges are improving their user experience, creating new competition. Sign more partners like Uber to become the go-to broker for gig-economy workers.
The DNA sequencing giant dominates its market, but investors are skittish about what the future may hold.
For a while, Illumina—the 800-pound gorilla of genomics—could do no wrong. The DNA-sequencing company's market cap more than quadrupled from 2012, to peak at a whopping $34 billion, fueled in part by the growing hype around the potential of genomics to transform how we prevent, diagnose, and treat disease, as well as facilitate medical research discoveries.
Illumina is also the primary game in town when it comes to DNA-sequencing machines. It has a near-monopoly in the research market, where its instruments have sequenced an estimated 90% of all the human genomes ever sequenced. The company has also been widely credited with being a key player in driving down the cost of sequencing from $100 million in 2001 to a few thousand dollars today (although it's worth noting that price has plateaued in the past few years).
Chart via Illumina
But in the past three out of four quarters, the company has consistently missed analysts' expectations in one way or another. Last week, after it announced revenues short of its own guidance, the San Diego-based company's stock tumbled as much as 25%. That represented its biggest decline in a single day in five years.
What is going on at Illumina, the biotech golden child? Speculation has been rife among analysts. One of the most obvious explanations, put forward last week by Bloomberg, is that the company simply isn't selling enough of its sequencing machines to justify its insanely high valuation. Illumina's instruments for analyzing human DNA range in price from $49,000 to up to $10 million. Revenue from its sequencing instruments declined 26% year-over-year, the company revealed in its recent earnings report.
The problem seems to be at the highest end of the market. Foundation Medicine, which is one of an elite group of organizations that have invested in dozens of Illumina's most expensive and highest-throughput machines—the HiSeq 2500 and 4000—has spent years building out its team of bio-informatics experts, scientists, and technicians. Sequencing is not as simple as taking a sample, plugging in the instrument, and waiting until the data spits out.
"Sequencing is difficult to perform at scale with high accuracy," explains Foundation Machine CEO Michael Pellini, whose company focuses on patients with cancer. "That's why there are only a handful of centers doing comprehensive genomic profiling, or whole genome and exome sequencing."
As Leslie Biesecker from the National Human Genome Research Institute recently told me, the number of people who have been sequenced in the United States is probably in the "five digit" range, which is still a sliver of the population (note: 23andMe, which has more than a million users, offers genotyping services, which is technically different than sequencing). Illumina's most expensive machine—the HiSeq X Ten—is capable of sequencing 18,000 human genomes each year. That's a lot of capacity, given the demand for sequencing.
Moreover, the well-funded labs that have invested in these machines will use them for their own research purposes, but they are also actively courting third parties (smaller labs and companies) to manage their samples, too. That eats into sales of Illumina's cheaper and smaller machines, as well as the consumables it sells. As Bryan Brokmeier, director and senior equity analyst at Cantor Fitzgerald, put it in an interview with CNBC, "Illumina has cannibalized themselves."
To be fair, Illumina's executives seem well aware of that. Its executive leadership, led by new CEO Francis DeSouza, has been making the rounds at industry conferences to tout the enormous potential of other markets—namely clinical and consumer. Most industry experts agree that the clinical sector is an order of magnitude larger than the research market, but it's not easy to jump from one into the other. The clinical market is highly regulated and the customer needs are fundamentally different.
Experts I spoke to say that Illumina would also need to fundamentally rethink its business model to sell into the clinical market. Clinical labs don't buy expensive equipment and re-agents—the consumables—in the same manner as a large research institution. Oftentimes, the machines will be available for next to nothing, and the companies will enter into a rental agreement for the re-agents. "It will require a very meaningful shift in pricing," says Pellini.
Illumina might also have a harder time getting paid, which Pellini describes as "very challenging" given the complexities of the insurance industry. "We have an army of people working through reimbursement issues," he adds.
Illumina dominates in its core market—research—but it is far from the only player jostling to bring sequencing technology into clinical labs. There's up-and-comers like Oxford Nanopore to contend with, as well as giants like Roche. Illumina "will be competing with multiple well-financed entities with large market caps," says Mark Blumling, chief executive officer of consumer genomics startup Genos, which is a potential competitor to Illumina spinout company Helix. And it will take time to make a dent, says Blumling: "The clinical market hasn't take off as fast as the market anticipated."
Many are wondering whether Illumina's future depends on it building the next killer clinical app. But on that quest, Illumina will inevitably walk a fine line in how it appears to compete with its customers. In the past decade, it has seen some promising new clinical markets open up, including non-invasive pregnancy screenings for genetic disorders like Down syndrome ($2.4 billion by the end of 2022); and so-called "liquid biopsy" tests to monitor late-stage cancers (an estimated $1 billion market by 2020). The consumer genomics market is also showing strong potential, with companies like 23andMe and AncestryDNA now boasting a million users apiece.
Will Illumina make its money as a supplier to these companies? Or will it spin out its own applications? "I think entrepreneurs, investors, and companies are at times apprehensive about Illumina and worried about if, and when, they might choose to compete against them," John Stuelpnagel, Illumina's cofounder and former chief operating officer, told me recently. Those concerns seemed justified in 2013 when Illumina bought Verinata Health, a competitor to one of its largest customers, Natera. Both companies offer pre-natal testing services.
All eyes are now on Illumina's "moonshots": Its forays into consumer genomics with Helix (an app store for genomics) and Grail (a screening test for cancer). If either of these companies take off, it might be worth it to rustle a few of its customers' feathers. But until then, some analysts say it'll need to prove to the market that its sky-high valuation is justified.
Only about 10% of customers stick with HelloFresh, Blue Apron, and Plated after six months, new data shows. The companies dispute the data.
Companies like Blue Apron, Plated, and HelloFresh like to pitch their services as a solution for busy consumers who want an easier way to plan their meals, but a new spending analysis shows that the vast majority of customers don't stick with these services over the long term.
The research firm 1010data analyzed consumer-spending data that represents millions of consumers, revealing a significant retention problem for the major meal-kit delivery services—which ship recipes with pre-portioned ingredients to customers on a weekly basis. After the second week, only about 50% of customers stick with Blue Apron, 1010data found. Six months into their subscriptions, only about 10% remain. The firm found a similar pattern for HelloFresh and Plated.
The findings are a contrast to what the companies themselves say about their own customer loyalty.
"Our customers who stick with us adapt Blue Apron to their lifestyles. They order week after week after week, and it becomes the way they cook dinner for their families," Blue Apron CEO Matt Salzberg told Fast Company earlier this month.
Spokespeople for Blue Apron, Plated, and HelloFresh all said that the 1010data analysis is inaccurate, but they declined to provide accurate data.
The firm, meanwhile, stands by the data. "While there is no way to test specifically how these metrics compare to companies' actual performance, spending trends in our data compare strongly to publicly reported comparable metrics from companies," Natalie Seidman, 1010data's senior vice president of data insights, said in an email. "[W]e have many clients of our data products who are confident enough in the representativeness of data to incorporate the insights we provide into their decision-making."
If a large number of people drop their subscriptions, it is a problem for meal-kit companies because they often spend a lot of money to encourage customers to sign up. Blue Apron, for instance, offers a $30 discount to first-time customers, the equivalent of about three meals. HelloFresh offers a $15 discount to new customers. Plated offers two free meals with the first order. If customers don't stick with their subscriptions for long, these companies don't recoup that marketing spend.
And yet for non-famous, young, plus-size women, the actual experience of shopping still kind of sucks. Our brick-and-mortar options are limited to expensive department stores or lines that skew older from Target or Lane Bryant. H&M recently introduced a new plus brand featuring Graham, but it's online only.
Since plus-size women are so often forced online for their clothing, it makes sense to have that process become a little easier. That's where Christine Hunsicker comes in. Hunsicker, a data-obsessed exec who founded startups acquired by Yahoo and Facebook, decided to take her talent for growing businesses into the fashion industry, creating Gwynnie Bee in 2012. Gwynnie Bee is a subscription retail service akin to Rent the Runway, but purely for sizes 10-32.
Christine Hunsicker[Photo: Shammel Lee, courtesy of Gwynnie Bee]
The tiered monthly plans let subscribers take out up to ten items at a time, with unlimited exchanges and free shipping. The brands come from big names like McCarthy or ASOS as well as small upstarts and straight-size companies looking to expand their offerings. Since 2012, Gwynnie Bee has grown 10% to 15% each year to become one of the biggest buyers in plus-size fashion; by 2015, the company had shipped over 3 million boxes.
Fast Company sat down with Hunsicker to talk about Gwynnie Bee's success, as well as Hunsicker's new show Project Runway: Fashion Startup, where she's an investor/judge along with Rebecca Minkoff, Birchbox's Katia Beauchamp, and Hildun's Gary Wassner. The show premieres October 20 on Lifetime.
How did you come up with the idea for Gwynnie Bee?
Four or five years ago, when I was thinking about what to do next, I knew I wanted to do something in technology and data that was disruptive to an industry. Apparel is obviously a huge industry, so I started looking there. The idea for Gwynnie Bee specifically has to do with, how can you help women feel more confident every day? And when you think about the sharing-economy model or the ongoing subscription service, it really allows you to get access to a much wider variety of clothing at a lower financial commitment. That was where we felt that model could have real impact in the way women viewed their relationship with clothing.
Who is the average Gwynnie Bee customer? What kinds of things do you see them wanting out of clothing?
I think our customer is generally a woman between the ages of 28 and 45. She has a job, she's a professional woman. She's looking for clothing that can make her feel great at her job every day. That could be anything from office-appropriate dresses with a little bit of a punch and color or flare or pattern, or blazers with interesting detailing. We see a wide variety across dresses, tops, and blazers. If we had to pick one type of item that's probably the most popular, it would be a knee length, fit-and-flare dress in jewel tones.
The big players in plus-size fashion tend to be fast fashion types—Forever 21, H&M, Torrid. How have you tapped into that kind of market even though Gwynnie Bee's clothes tend to come from these relatively higher-priced brands?
The price point for our service is, for the three plan, close to a piece and a half of what you would pay for at these mainstream vertical retailers. It's affordable, and what you get access to is so many more designers, styles, options at all different quality levels for that one price. That value proposition itself is what consumers gravitate toward.
As a plus-size woman I definitely see a gap in the styles I can buy. Either it's kind of cartoonish, skull-covered clothes at Torrid, or more traditional styles at Lane Bryant. How does Gwynnie Bee work to fill in that gap of what's available for professional women at brick-and-mortar stores?
We're trying to bring in as many contemporary brands as possible. There are some smaller brands, they're not big enough to have their own stores, but some plus designers who make very beautiful, interesting, contemporary clothing. We try to curate collections around those designers. We've been bringing in more straight size designers into our service. We did a partnership with Rachel Antonoff. We are launching a new business-wear line. We've done Corey, Jay Godfrey, Amanda Uprichard, so we're trying to bring in styles we hear from our members are not readily accessible in the standard plus market.
Yeah, I'd love to hear more about helping these straight-size brands. How do you help them realize there's a market for this kind of fashion?
I think nothing helps people realize there is a market like money. One of the biggest things is we buy a lot. We're one of the biggest buyers in plus. We'll go to straight-size designers where we think it will translate well into plus, and that fills a hole in the market like you were just describing.
Not only will we order an entire capsule collection, we will also handle their fit and pattern making for them. One of the toughest things in moving from plus to straight or straight to plus is that the pattern grading is different. That's a big investment and takes many years to be an expert at it. So one of the services we offer to these designers is to translate their patterns into proper-fitting plus patterns. Those two things—we'll help the fit and give them distribution without financial risk on their part—take away their two biggest worries. One, that their collection isn't going to fit and two, that no one is going to buy it.
You mentioned when we talked earlier about how into data you are and how that, almost more than a desire to be a fashion mogul, has propelled you forward with Gwynnie Bee. Can you talk a little more about that and what it is about data that inspires you?
I think that apparel in general is not a very data-rich industry. That's caused by a couple of factors, but the biggest one is that it is by nature a transactional relationship. You walk into a store, and if you buy something it's a one-off transaction. As a consumer you have no incentive to give feedback to the store on how something fit or didn't fit. It's simply a single transaction.
In order to gather significant amounts of data, you have to change that model. Our model is really relationship-driven. Our members are with us month to month, they're wearing eight to 10 pieces of clothing a month, and they're giving us feedback on each and every one of those pieces. That allows us to really personalize and recommend items to each and every member on an individual basis. It also allows us to recommend things based on likelihood of fit. One of the biggest challenges of buying online is you have no idea if it's going to fit, and so we use the data to help in that area as well.
Christine Hunsicker in Gwynnie Bee's offices.
You have experience growing these companies that were bought by Yahoo and Facebook. How have you translated your startup growing experience to Gwynnie Bee?
Hopefully I have learned a lot of lessons and am not making the same mistakes I made before. The biggest lesson going forward is when you're trying to build a long-lasting institution, you do things a little differently in the way you grow the company internally. You think about hiring plans and org design and communication protocols much more deeply. It's not simply a focus on the product because you're looking to have an institution that can withstand time.
So the new show you're going to be on, what will your role be? What are you excited about?
It's essentially Shark Tank meets Project Runway. It's called Project Runway: Fashion Startup. There are four investors through the season and I'm one of them, doing eight hour-long episodes. We review 28 pitches, so 28 entrepreneurs come in and tell us why we should give them money and why they're going to be able to build a brand. And we eventually decide if we're going to back them or not. Our job is to figure out very quickly, does this idea have legs and do we want to work with this person? It was great fun, the investors got along really well. The production crew was fantastic, Lifetime and the Weinstein Company were fantastic to us. I couldn't be more excited for it to come out.
Hard to believe, but this bonkers election cycle is nearly over. Here are some ways that entrepreneurs and educators would fix the system.
In a few short weeks, this bizarre, seemingly interminable election cycle will come to an end. And no matter who wins, one thing is certain: Our process for electing the president of the United States is ripe for disruption (Russian hackers notwithstanding). So we asked Fast Company's influencer community to offer solutions. More than 50 of them weighed in with ideas. Here is a sampling.
"We need to move to a form of voter registration like Oregon's—everyone is preregistered unless they opt out." —Jack Harrison-Quintana, director of Grindr for Equality, Grindr
"So many brilliant people don't run because of the burden on personal lives, the hit one's reputation takes, and it's too expensive. If we can change at least the first two, that would be awesome." —Leslie Bradshaw, managing partner, Made by Many
"The process is way too long. It's a holdover from when information and people traveled less swiftly. As a result, campaigns need to spend more and presidents need to begin running for reelection halfway through their term." —Hunter Walk, partner, Homebrew
"Have one independent candidate every cycle that receives public financing and participates in the debates. That would allow for greater diversity of viewpoints and force candidates not to simply cater to their parties' bases." —Andrew Yang, founder and CEO, Venture for America
"I'd prefer a parliamentary system where the chief executive is elected from the majority party in Congress. That would ensure that legislation could pass and voters would vote out administrations whose legislation they've seen fail." —Matthew J. Schmidt, professor, national security and political science, University of New Haven
"Dismantle the electoral college and go with the raw popular vote." —Olajide Williams, president, Hip Hop Public Health
"Fewer than 9% of citizens cast a primary vote for our two presidential candidates. There's got to be a way to engage the majority right from the start." —Tom Phillips, CEO, Dstillery
"Vote from our phones." —Moj Mahdara, CEO, Beautycon Media
"Have a bipartisan group develop a list of yes-or-no questions that cover major policy and social issues, and require all candidates to answer with a simple yes or no in order to get on the ballot." —Scott Belsky, partner, Benchmark
"Use public matching funds to boost the power of small campaign donations." —Daniel G. Newman, president and cofounder, MapLight
New research suggests a correlation between an employee's control over their work and their life expectancy.
People often complain that their job is killing them, or that they're working themselves to death, but new research suggests there may be more truth to those clichés than we realize.
A recent study conducted by Indiana University's Kelley School of Business found that those who work in high-stress jobs with little control are more likely to die sooner than those who have more control over and balance in their work.
The study, which has been accepted for publication in the Journal of Personnel Psychology, followed up with Wisconsin residents who had participated in a longitudinal study of 10,000 people that graduated from Wisconsin high schools in 1957. Participants were interviewed on their education, occupation, and emotional experiences at various intervals throughout their lives.
Of those initial 10,000, Indiana University researchers identified 2,363 participants who had not yet retired in 2004, and interviewed them about their job demands.
When researchers followed up with this group in 2011, those who had spent their lives working in stressful environments that provided them with little control were 15.4% more likely to have died. At the same time, those who spent their careers with high levels of control as well as high job demands were associated with a 34% decrease in the likelihood of death, compared with low-demand jobs.
"We explored job demands, or the amount of work, time pressure, and concentration demands of a job, and job control, or the amount of discretion one has over making decisions at work, as joint predictors of death," wrote the study's lead author, Erik Gonzalez-Mulé, in a statement. "These findings suggest that stressful jobs have clear negative consequences for employee health when paired with low freedom in decision making, while stressful jobs can actually be beneficial to employee health if also paired with freedom in decision making."
The study suggests there are a number of health complications that result from being micromanaged, many of which have a direct impact on the employee's longevity. For example, those in high-stress positions with little control are more likely to be overweight, the authors suggest.
"When you don't have the necessary resources to deal with a demanding job, you do this other stuff," Gonzalez-Mulé says. "You might eat more, you might smoke, you might engage in some of these things to cope with it."
Employers have become increasingly concerned with employee health in recent years, as studies continue to show the direct cost it can have. For example, Duke University researchers found that obesity costs American businesses $73.1 billion per year, while Harvard researchers suggest insomnia is responsible for $63.2 billion in costs.
Employers have combatted these expenses through the deployment of health and wellness programs, but the Indiana University study suggests they're largely failing to tackle the health risk right under their noses.
"You can avoid the negative health consequences if you allow them to set their own goals, set their own schedules, prioritize their decision making, and the like," Gonzalez-Mulé says. He believes that businesses should allow "employees to have a voice in the goal-setting process."
That's not to say that employers should avoid stressing out their staff. In fact, studies suggest that some acute workplace stress may help keep the brain alert, and that better alertness can lead to better performance.
"Stressful jobs cause you to find ways to problem-solve and work through ways to get the work done. Having higher control gives you the resources you need to do that," says Gonzalez-Mulé. "A stressful job then, instead of being something debilitating, can be something that's energizing. You're able to set your own goals, you're able to prioritize work. You can go about deciding how you're going to get it done. That stress then becomes something you enjoy."
The real health concern, explains Gonzalez-Mulé, occurs when stress meets a lack of control. Of the study's deceased participants, 26% were in front-line service jobs, and 32% were in manufacturing.
"For a construction worker, it's going to be really hard to allow them autonomy; there's usually just one right way to do things. In jobs like that, it's more about just warning the employee of the risks that are there," he says.
At least employees of all shapes and collars can now put forward a compelling argument as to why they need more flexibility in the workplace. After all, it just might save their life.
