Taking a break

I have not had so much time to blog lately but I found this video fun... (Thanks Horaci)

Acceleration

The Spanish mortgage market has seen a shift toward intermediation and toward more complex products over the last few years. Given the current liquidity environment, one might think that it will revert back to traditional products sold through branches but it’s not the case.

In fact, what we see more and more are new and more complex products, introduced by lenders in partnership with large brokers as in this example (and there are many more).

This tells me two things:

1. Like in the US since August, lenders understand the need to manage the current borrower’s base in the long term and that closing the door to consumers in difficulty will only increase default and reduce the value of real estate (thus of the lender’s collateral)
2. The “consulting” part of the sales process becomes increasingly valuable to consumers because choosing the right product is no longer about the lowest rate or monthly payment.

The market is getting "smarter / more mature” but progress is still needed. If you read the article, did you pick up on how the product is presented as a solution against the risk of a rising Euribor when, in reality, even if Euribor stayed flat, the product requires increasing payments over time?

Law 2.0

Let’s start with 2 facts:

1. Web 2.0 is proving the power of user generated content. We see a faster shift of power toward consumer and, while all the content is not good quality, some great new content would probably never have seen the day of light without it.
2. Laws, while necessary, are often ineffective. Banks spent billions complying with numerous and complex regulations, dealing with governance and anti-predatory lending laws etc and we have… a subprime crisis.

I am putting these two facts side by side because a recent ruling from the US court indicates that there might be a significant change to the legal framework of Internet coming and that the broad legal shields used so far may, in fact, not be deemed sufficient in the future.

My worry is that introducing more regulations in internet may slow down the pace of development without (like in banking) providing real consumer protection.

I believe the courts would provide more value by judging the ethic of the businesses that are brought in front of them and consumers need more effective advocacy, not necessarily more legal constraints they will end up paying for.

Though of the day: The (not just) American Dream

“You arrive poor, you work hard and you die rich” that’s what’s called the American dream. Today this well known phrase could change to: “you start from 0, you work hard, you help change the world (and become rich in the process)”.

The internet has created a world where opportunities are a function of your mindset, talent and drive, not of geography. Location helps but the era of Sinatra is over and you no longer have to “make it there”

save the developpers... (from themselves?)

I just found out about an initiative that I thought was smart: “Save the developers”. Basically, developers who are tired of compatibility issues between IE6 and the other browsers (IE7 or FireFox) have created a small code that detects if the user uses IE6 and proposes to upgrade to 7 or Firefox.

Personally I don’t think it removes the need for developers to make the site work for IE6 because you may suggest to a user to change their browser so they can benefit from the wonders of your site but the reality is that it is your site that has to adapt to the browser of your audience. It is still good to suggest and hopefully get to a point where IE6 users are a minority that could be ignored.

I wanted to see what the suggestion looked like for a user so I went to the website of the initiative. It was so typical of developers that I could not “not blog it”. Don’t get me wrong, I love developers but guys, when you get a good idea think about your audience and how the end product comes across.

This is what I got the first time I tried to connect

The second time, after waiting for quite some time I got one of the ugliest “naked” web page I have seen in years. I am sure it works in 100% of browsers but no one really wants to look at it.

Smart Tata...

A thought that is neither web 2.0, nor finance…

Regardless of the price paid and of whether Jaguar is back to what it used to be or not, here are a couple of reasons that make me believe it was smart of Tata to buy Jaguar

• Transfer of technology: (obvious), Tata’s technology is so far behind that what Jaguar engineers will willingly share will help Tata make better cars and ultimately make an entry into more developed markets
• Learning the other markets: By selling jaguar in Europe and the US, Tata will learn what it takes to sell cars there and could prepare to take their future “Tata” global
• Risk mitigation: With all the discussion about the potential crash in emerging economies (India or China) finding shelter in luxury goods can be a smart play
• Greater distribution for Jaguar in the subcontinent and Asia

Of course people might say that this is bad for Jaguar and few synergies can be found with Mittal but Tata has proven for over 100 years that it had a very strong business sense and succeeded in various industries (creating the first steel mill in India, providing electricity to Mumbai, starting the country’s first airline, and being the first to locally make trains).

What they now need is to prove that they can manage a truly global business and capture the value of synergies,... great challenge ahead !

The espresso dilemma

I subscribe to the blog of a few successful entrepreneurs. In the last week I read the tips for startups from 2 different ones, both very credible.

• One said: “get an espresso machine (and a Wii)” explaining how the company would save money because people will spend less time outside
• The other said “don’t buy an espresso machine” because people in a startup should have passion and people with passion work hard anyway.

As an entrepreneur and an extravert, I often seek other people’s feedback. On subjects much more important that the espresso machine, I usually get intelligent and contradictory advice. In the end I can only look for trends (if everyone tells me the same thing), keep common sense in mind and trust my judgment/intuition.

The power’s in your hand

I just came back from Plugg in Brussels. I went there to learn about other people’s perspective on web 2.0 and to network. I found the event well worth the trip, the presentation and attendance of quality but that’s not the point.

I always believed that internet would enable a massive shift of power toward consumers. It started with price comparison sites and evolved into the various new themes of web 2.0 (social networks, blogs, consumer produced content, etc.). During the conference, most speakers/entrepreneurs, at some point, touched on that. This proves that today’s internet is starting to deliver on the late 90s promises.

So, now that the consumers’ voices have more power the question is: what really is the next big thing?

I believe that in web 2.0, like in web 1.0, companies who figure out a strong revenue model and build capabilities that are not so easy to replicate will prevail. The web 2.0 consumer-facing companies are usually either partial (i.e. selling their own products) or limited in their revenue model (i.e., advertising and little more, etc).

I don’t know about you but I feel like a piece of the puzzle is missing and that more depth is needed to monetize this new value without reducing its ability to feed upon itself. If you want to know what I want to do about it do not hesitate to e-mail me and ask :-)

Coming of age

According to OJOinternet, the e-commerce in Spain increased by 47% in 2007 and half of the revenue went to Spanish companies. According to the same article, revenues reached €938 Million between April and July 2007.

If we assumed that the average transaction is worth €100, this would mean that every calendar day, 77,307 Spanish consumers complete a transaction online. That's great news but it also shows tremendous opportunities ahead. Indeed, in the last 2 years, there has been an estimated 7 million high speed internet lines installed in Spain so, even if we assumed that all of this was B2C, it would still equate to only 1% of the people with high speed connections.

400 competitors...

Competitive landscapes...
Part of the reason I am so optimistic about my project is that the European market is, in general, trailing behind the US in terms of mortgage distribution and use of internet. I was talking yesterday with the founder of a company, based in California, who has developed capabilities similar to some of the capabilities I plan to build. During the conversation he mentioned that he had, in the US, 400 competitors. He also mentioned that he recently started to export his technology to 2 other non European countries and found... 0 competitor.

In Europe, the number is not 0 but it certainly is not much more... now more than ever I believe that I need to find some horsepower to get the project off the ground quickly, thinking scale and reach from day one before 400 others do.