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Protected: ThxGiving Weekend 11/24
An Often-Ignored Factor Affecting Wine Industry – Global Warming
In wine’s history, we human began to enjoy/produce those fermented grape beverages some 6,000-9,000 years ago.
The well-known classification system for Bordeaux wines started in 1855 by Napoleon III using their producers’ names. A château (a french house/castle) usually gives its name to the wine produced in its neighborhood. The system has five levels for red wine, with Premiers Crus being the best, which now includes 5 châteaux.
But after nearly 200 years, things have changed fundamentally, e.g. global warming among many others.
Wine is essentially a pre-industrial-age agricultural invention. Grapes are inherently affected by climate changes (including not only temperature, but also drought for example).
What we deemed best in 1850s should be different from those in today’s league table.
Due to global warming, the best grape varieties and growing locations for wine can hardly stay the same by the end of 21st century. Some have predicted that average global temperature could rise by 11.5° F this century if no human interventions to mitigate the causes.
A relatively extreme prediction in a 2013 study claims that wines from Burgundy, Napa Valley and other premium regions, will disappear within the next 50 years (and blue regions are future suitable areas to grow grapes).
However, wine to some extent is like art works. Values of wine aren’t mostly depending on how it tastes; many other factors such as traditions or experience are making it a more complex industry.
While similar to other industries that the established or incumbents are not willing to/refuse to change, new opportunities will rely on new vineyards/newcomers and those choose to expand or create new brands.
Read more on:
「Video of the Week」a16z Talk by Benedict Evans
Beyond Meat Go IPO and Non-animal Food Trend
From Vegetarians to non-animal meat-like food, we are entering an age of synthetic foods going mainstream.
Beyond Meat – story and IPO
Beyond Meat (BYNd), a start-up who made the first 100% plant-based burger, filed IPO with SEC recently and will become the first of its kind to trade on Nasdaq.
The founder grew up in Maryland with a family farm business. The company was founded in 2009, with initial operation, and manufacturing in Maryland. The foundational technology was licensed from two researchers in nearby universities. And initially, the company built its presence with Whole Foods Market in mid-Atlantic.
Beyond Meat was funded by venture capitals, including Kleiner Perkins (16.1% pre-IPO stake), Obvious Ventures, among others, totaling $140+ million before IPO. The latest round valued the company at $550 million last year.
The IPO filing indicates a $100 million raise. Currently, the most important product is the Beyond Burger, selling through various grocery chains and other channels, representing 71% of 2017 sales.
Beyond Beyond Meat
Within this space, the most famous startup might be Impossible Foods, sold in many restaurants including The Counter. It raised $114 million this year from investors including Temasek.
Other initiatives include the new plant-protein-based drink by Starbucks, although not a popular offering.
I think for sure in the future food market, the overall percentage of plant-based food will increase and animal-killing will be decreased by a lot. Whether eventually most of the food will be entirely synthesized remains a question for now.
At least in 30-50 years, I think the benefits of non-plant-based food are non-obvious. But the non-animal trend will be more influential and be part of everyone’s life, not just for vegetarians.
A Glimpse into Instagram’s Commercial Efforts
- I will keep this updated
- Based on personal ins screenshots
Effort One – Bis/Org official page and promotion
E.g.
Similar to FB’s news feed ads; similar to ads in Wechat Moments, etc.
Effort Two – Ads in Instagram Stories, in three forms: Learn More, Shop Now, Subscribe
E.g.
Currently Instagram hasn’t provide direct shopping/subscription function; it is linking to third-party websites.
But I could see it is possible to bypass Amazon or Apple ID subscriptions.
Effort Three – cosponsored
E.g. (from a public account through search)
This is more like a platform and pairing influencers with businesses. Provide a way for influencer to monetize and change the way businesses used in promotion.
Effort Four – cross suggestion/reference
It is not formally introduced to users. But it is enabled by Instagram’s ecosystem.
E.g., after I followed an independent hotel in Palm Spring, I got three likes from JW Marriott Desert Springs (a nearby hotel).
Also, I got followed by collegehousephilly after following DailyPennsylvania (student-run newspaper at Penn, mostly seen by Penn students); Philly is short for Philadelphia, where Penn is located.
Will keep updating this post.
A Great Symmetry?
A random thought here…
San Francisco = New York City (Manhattan)| in terms of the central hub in west/east, financial and corporate presence, high rise apartments
San Jose (South Bay) = Philadelphia | in terms of specialized industries, lead in Information Age (semiconductor) & lead in Industrial Age
Los Angeles + San Diego = Orlando + Miami + Key west | In terms of weather, travel and entertainment industries, life styles
So California is a semi-country.
In the Age of Services Bundling
The recent departure of Google Cloud’s CEO leads to many discussions on the business models. Specifically, Google Cloud service is usually co-marketed with other enterprise services provided by Google. For businesses that rely heavily on Google’s internet advertising, it feels a combination of a natural need of using its Cloud and an external soft-pressure from Alphabet.
US enterprise cloud business is mainly comprised by 3 companies – Amazon, Microsoft and Google. Amazon is famous for its 7-year head start. However, Microsoft Azure has surpassed AWS in revenue for the first time in Q2 this year.
[Some thoughts on cloud business: with its dominating position in enterprise market, and its Office suite going online with subscription model, Microsoft is definitely capitalizing a lot on the bundling with Azure cloud services. Google definitely wanted to replicate the business model, but found itself lack of comparable presence in the enterprise market – e.g. direct relationships, sales reps. That was probably the reason Alphabet brought in Diane Greene, co-founder of VMWare, in Nov. 2015 with all the enterprise connections and experiences behind her.]
The bundling + subscription is everywhere. Amazon Prime is a bundling, with original unlimited free two-day shipping to Amazon Music/Video/Fresh/Now, etc.; Netflix is essentially a bundling – with some core contents plus other programs; AT&A Direct TV is another example; Square is bundling terminals (POS), employee management…
It is so prevalent that I would like to say that instead of “software eating X”, it is “bundling X and just subscribe together”.
「Video of the Week」Climate Change
The video is short and introductory. But here is an report (original paper on nature) recently released arguing that temperature may raise by 5 degrees Celsius by 2100.
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Capitalizing on Fear for Anti-Competition
Following up on the previous post of WSJ buying ads on Twitter, I found an underlying trend to explain it and other similar situations – companies are afraid of the accusations that they are preventing or reducing competitions, especially in the tech industry where network effects is extremely strong and “winners take all”.
Just another example here – Amazon Music putting ads on YouTube.
Fundamentally, there are similar laws around the globe focusing on competition, anti-monopoly and antitrust. Twitter doesn’t want to make the case that it is discouraging other medias’ ads; YouTube doesn’t want to make the case that it is discouraging other music apps’ ads.
It has more profound meanings other than ads. Google was fined in Europe for bundling Android in June with its other services, reducing competitions in services such as search. Going way back, Microsoft’s antitrust case in 2001 is probably the most famous one – a settlement was reached for its bundling of Windows and IE (may discourage other web browsers).
This concept can be expanded into many fields. And the fear of being seen as anti-competition is deeply rooted in every tech company.
We should see that Apple should welcome YouTube and Amazon Music so that it won’t be charged as anti-competition in music distribution. Apple Music is born with a market share limit.
Other examples – Apple should keep Fitbit with its Apple Watch, Chrome should keep other search engines with Google Search, Amazon should keep those third-party items with its AmazonBasic lines, etc… Uber should keep Lyft, Intel should keep AMD. Disney should be careful for its contents and distribution channels, so does AT&T…
There are many more examples. And this will last in the foreseeable future, maybe until ordinary antitrust law can’t handle new norms. Or, it may lead to excessive capitalization on the law. Basically, the other side will use antitrust as an very effective weapon. It won’t be a commonly used weapon among small companies due to high legal costs and lack of resources to maintain big market share. But it may be used more often by relatively big companies to expand into new fields with meaningful presence, building into conglomerates in the new era.