Rishi Taparia - Issue #73
This week we look at the complex story behind Amazon Marketplace, Swiggy’s massive raise, how cash is still king in India, Indonesia’s mobile payment book, reading vs. audiobooks and more. Enjoy!
Commerce
Prime and punishment
An incredible piece on the $175 billion dollar Amazon marketplace that reads like the love child of an Orwell and le Carré novel - a dangerous overlord passing judgement on helpless participants, with equal parts intrigue, underhanded dealing, corruption and mysterious characters thrown in for good measure. Take the time to read this one.
Hate Shopping? New Texting Services Will Simplify Your Life
Fancy sites, optimized user flows, pretty pictures and great pricing be damned. A new trend—shopping via text—has taken root as frequent shoppers bemoan the complexity of “traditional” e-commerce. In a further shift toward curation and lower friction, and with a hint of history repeating itself, ‘personal shoppers’ are now simply texting customers with new inventory that comes available, entire transactions conducted over a messaging app.
Swiggy raises mega $1B round, valuation swells to $3.3B
Food delivery continues to be big business. Indian startup Swiggy this week announced a $1bn round, on the heels of a $210m round in June and $100m round in February THIS YEAR! Locked in a fierce competition with rival service Zomato, and fighting regulation and attempted food delivery app bans in various cities, I can only imagine the company is burning through cash. That said, being able to raise $1.3bn in a single year and get marked up each time is quite the feat.
Kohl's, Old Navy sprint to win the final lap of the holiday race
Does last minute Christmas shopping have you stressed out and not sure where to go, since naturally you want to do the shopping in person as opposed to from your couch? First, shame on you for waiting so long. Second, have no fear, both Kohl’s and Old Navy are here. At the time of this writing, select Kohl’s locations have been open for 47 hours straight, and will be open for another 36 hours, in an attempt to capture foot traffic (and attention), repeating a move the started a few years ago. Old Navy is helping you get to the store thanks to a partnership with Lyft, trying to drive buy online pickup in store activity. So get up off the couch and go get that gift!
FinTech
Cash is still king for Indians: Study
Despite all the noise about the movement towards a cashless world, the demonetization effort that took place a few years ago, and major pushes by wallet companies like Paytm, Tez, AmazonPay and WhatsApp, cash is still king in India. Cash usage is up 10% over the last two years, and while e-commerce sales are surging, most of the sales are being driven by cash on delivery.
Does China’s bet on big data for credit scoring work?
We’ve talked before about China’s credit scoring system, the early version of what could become a Black Mirror episode in real life. Ant Financial has touted data as the backbone of this credit system, and with Sesame Credit, said they would be able to offer loans to a broader set of people than the traditional credit systems would allow for. Now, almost 4 years later, the question remains whether this ‘new credit’ system works.
[Ant Financial] has never used Sesame Credit for lending decisions…Sesame, which is an opt-in feature of the Alipay mobile payments app, draws upon the biggest pool of non-traditional ratings data in the world. It synthesises details from hundreds of sources — ranging from purchases on Alibaba’s Taobao marketplace to subway fares — into a single trustworthiness number for each user, called a “Sesame score”. But one Ant Financial employee conceded there was a difference between “big data” and “strong data”, with big data not always providing the most relevant information for predicting behaviour, and analysts say the best predictor of whether someone will default on a loan in future is often their previous loan repayment history, rather than their likelihood of returning a rental car.
Indonesian mobile payments set for cross-platform boom
A good deep dive into the Indonesian mobile payment ecosystem, booming of late in part due to the Indonesian central bank’s aim to achieve 75% financial inclusion by 2019. GoJek is the market leader, but facing increased competition from Grab and OVO Cash.
Why Cashless Stores Hurt Poor Shoppers
The push continues to be towards a cashless economy. Another piece on the challenges of cashless for the poor or underbanked, following up on the Times piece a few weeks ago.
Technology
Porn sites collect more user data than Netflix or Hulu. This is what they do with it.
The biggest and perhaps best source of data about what people like to watch on the internet and what they would pay for doesn’t come from streaming giants like Netflix, Amazon Prime Video, or Hulu. It comes from porn. Pornography is big business (as high as $97bn a year in revenue) and has been responsible for the widespread adoption of technology including VHS, IMs, e-commerce, and video streaming (people doing things for pornography translates into doing things in the mainstream). As it turns out, there is a monopoly in the pornography business, MindGeek, and how they use their data may surprise you.
Norway’s Energy-Positive Building Spree Is Here
A consortium in Oslo made up of architects, engineers, environmentalists, and designers is creating energy-positive buildings in a country with some of the coldest and darkest winters on Earth.
Random Tidbits
Is Listening to a Book the Same Thing as Reading It?
Quality audio content has exploded over the last few years with audiobooks being no exception, audiobook sales having doubled in the last five years while print and e-book sales are flat. Is reading a book the same as listening to it? The short answer - it depends.
America Can’t Move Its Cheese
There is a cheese issue in America, and no, it’s not that we eat too much of it (although that could be true as well). There is an over supply of the stuff, asAmerica’s cheese hoard continues to balloon to unprecedented levels. Cheese producers fear the mountain could grow further and put even more dairy farmers out of business.
Package Thief vs. Glitter Bomb Trap
Packages getting stolen off porches are becoming more common. Well, now there’s a solution.
Quote I’m thinking about: “The capacity for delight is the ability to pay attention.” - Julia Cameron