Tippets by Taps - Issue #114
New week, new issue! This week we look at the genesis of the two-week pay cycle and its impact on hourly workers, PayPal’s entry into China and what it means for international ecommerce, the impact of the digital revolution on society, the biggest tech flops of the decade and more. Enjoy!
Some Of The Biggest Companies Are Reinventing How We Get Paid And How Often
Getting paid every two weeks is a legacy of the the 1930s, a result of the tax regime and the desire to deduct taxes and union dues from paychecks which was hard in a world pre-computers. Today the technology exists today to pay employees on a daily (or hourly) basis, and yet today most employees are still paid every two weeks, essentially extending employers a 0%. Waiting two weeks between paychecks is a long time, particularly for low wage workers. But technology and a tight labor market could be changing that. This NPR piece goes into some of the challenges and solutions employers are trying to use to benefit their workers.
GONZALEZ: That’s Shoukat Dhanani (ph). Around 2 ½ years ago, the labor market started getting tight. Employment was high. Basically, everyone had a job. And Dhanani says it started getting hard to find workers.
DHANANI: We had a restaurant we were opening in Stoughton, Mass., and the restaurant sat there ready to open for three months because we couldn’t get enough staff to open the restaurant.
GONZALEZ: So Dhanani starts offering perks.
DHANANI: We’ve got an aggressive bonus program. We rolled out 401(k)s. We’ve raised wages.
GONZALEZ: And then he hears about an app that gives workers access to their earned wages daily - DailyPay. Dhanani told employees at 100 of his New England Burger Kings, try it if you want. See what you think.
More and more, employers are starting to care about employees financial wellness. particularly given the high cost of replacing an hourly worker. Delivering value added solutions for employers through partnering with companies built to solve this problem like Even, DailyPay and Earnin is a no brainer to me. There are tremendous amounts of opportunity to support both employees and employers. I’m sure we’ll see more companies emerge to fill this gap.
PayPal completes GoPay acquisition, allowing the payments platform to enter China
This week PayPal scored itself a major prize - 70% ownership of the Chinese digital payments company, Gopay. This is a major milestone for the company as it means PayPal is the only non-Chinese provider that can offer online payments in the country. It allows the 270 million worldwide users to purchase items in made by Chinese suppliers and gives Chinese users another method to make online transactions outside of Alipay and WeChat Pay. With Chinese players allowing foreign users onto the platform, PayPal’s entry into the market is certain to add a little spice to the online payments battle. I expect 2020 to bring a lot more news about PayPal and coming partnerships, especially with other retailers looking to crack the Chinese market.
Amazon: Retailers Gonna Retail
What if many of the recent changes reflect not a path to domination, but Amazon’s journey as a more traditional retailer? In this piece Steven Sinofsky of a16z he makes the case that “retail is so unpredictable, yet brutally predictable” and, because Amazon is at its core, a retailer, they too will be predictable in their trajectory.
Historically rollover is due to a secular change in how people both buy and sell stuff. We might call this disruption, but these changes are tied to transport, communication, suburbanization, etc. No mistake, there’s innovation but in retail this is a response to secular change.
Each generation of retail can be thought of as a response to the structural changes in society — people need things and retailers provide them. If the things people need, the places they go to get them, or the way they find them change, then retailers adapt (or innovate) to meet those needs.
Alienated, Alone And Angry: What The Digital Revolution Really Did To Us
In 1997 Wired Magazine ran a feature story titled, “Birth of a Digital Nation”. In it, author Jon Katz proclaimed, despite the United States being in the midst of a monumental upswing with a soaring stock market and unprecedented technological developments, was on the cusp of something even bigger - “25 years of prosperity and freedom” largely thanks to “a new social class” of “young, educated, affluent” urbanites whose “business, social and cultural lives increasingly revolve around” the internet”. Joseph Bernstein of Buzzfeed argues that the digital revolution in fact alienated us as a country instead of bringing people closer together.
Here is the most alienating fact about the Digital Nation we live in: It incentivizes forms of engagement that make Americans feel less empowered and more alone than ever, to the benefit of very few. It seizes some of the best, noblest human instincts — to share, to know, to connect, to belong — and harnesses them to a degrading system of profit. Anesthetization to these conditions is dangerous. Cynicism and powerlessness are the hallmarks of another form of digital life, an authoritarian one Americans should badly want to avoid.
I wonder, as the US stumbles into a new decade, what kind of groups and communities we’ll form to deal with these feelings of alienation. Alienated people are especially vulnerable to the destructive forms of belonging promised by nationalism and racism. We know where those lead. Among those who can afford it, people may simply pay their way into less alienating online experiences. One thing that gives me a small amount of hope is the recent wave of tech worker organizing. Whatever becomes of it, it’s heartening to witness a group of people who are part of this alienating system attempt to build a movement around solidarity and direct action.
The 84 biggest flops, fails, and dead dreams of the decade in tech
We’re not only coming up on the end of a year, but the end of a decade. Naturally we are going to get a number of lists and predictions for the future. I found this list of the 84 biggest tech flops of the decade particularly funny. On it is everything from 24. Juicero (duh), 18. Blackberry (double duh) and 5. Google Glass to the 15. Fyre Festival, 41. WeWork’s attempt to go public and 58. Qwikster. That said, #26 was…quite unique.
26. Everything will.i.am touches
Most famous for winning the competitive battle for being the worst member of the Black Eyed Peas, will.i.am (né William) struck it out on his own in the past decade as a solo artist…
will.i.am’s other solo act was as a tech entrepreneur, which involved a series of products, decisions, and acquisitions that I would also describe as boners. In 2012, will.i.am founded i.am+, which produced garish iPhone cases with slide-out keyboards and a separate camera. This would be his least bad idea over the next eight years. Next he launched the Puls, a smartwatch which our own Dan Seifert called “the worst product I’ve touched all year.” He followed it up with another smartwatch — this one voice activated, for no apparent reason — called Dial that nobody bought. Then there was the Delorean-inspired car IAMAUTO, a vehicle that was immediately impounded for not being street legal, but did make me better appreciate when will.i.am’s branding is lowercase and separated by periods. i.am+ later acquired Wink, pivoting to a business focused on smart home, AI, and losing gobs and gobs of money. Things got so bad that employees went months without pay. Also, somewhere in there, will.i.am had time to become chief creative officer of a company that 3D prints bullshit.
What does the next decade look like for will.i.am? This December, he launched Buttons, a new company featuring — checks notes — wireless earbuds, which means we can look forward to 10 more years of boners. —Kevin Nguyen
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Quote I’m thinking about: “The problem with small is that it isn’t sexy, and it’s often repetitively boring.” - Josh Medcalf