Nic Brisbourne's view from London on technology and startups

In labour marketplaces algorithms might be better for workers than regulation

By | Startup general interest | One Comment

Tim O’Reilly just wrote a great post suggesting that in labour marketplaces, like the one Uber operates, algorithms might offer a better deal to workers than regulation. It’s a complex argument and Tim’s long post is well worth a read if you have the time. For those of you in the mood for a summary the centrepiece of his argument is that Uber allows market forces to determine prices and allows individual drivers to determine when and where they work. Those two features combined result in a more efficient system that works out much better for drivers (and everyone else) than it would if regulators force them to make their drivers employees. As Tim notes, top down micro-management of low cost work-forces to match supply and demand have been ‘a disaster for workers’. Think Walmart or McDonalds.

There are a couple of other factors at play here too. Firstly Uber has expanded the market – people take more cabs because it’s cars are reliably available at short notice. Secondly Uber drivers are in charge of their own lives in a way that salaried employees never are. Uber drivers decide when to work, and where to work. Moreover, Uber’s surge pricing helps them with that decision. As Dan Pink highlighted autonomy is a major driver of job satisfaction.

Nothing is wholly good or wholly bad and there is, of course, a flip side to this. Uber’s algorithm sometimes causes problems, including one case of gouging passengers during a crisis, and overly aggressive behaviour from Uber execs certainly makes one pause for thought, but these seem more like problems that can be ironed out than flaws in the model.

Stepping up a level, ‘Algorithms beat regulation’ is a very radical idea and Tim’s article is a call for academics and policy makers to start thinking about it seriously.

Superficially it sounds to me like it could work and therefore merits investigation. One of the most obvious challenges is that labour marketplaces have huge economies of scale and could end up as natural monopolies, requiring a whole new set of interventions from the regulator. Another obvious challenge is to understand whether the Uber model works in the same way outside of taxis.

In the short term, if it is true that labour marketplaces can offer a better deal for both workers and customers then we should expect the model to become much more prevalent. It’s interesting that despite massive investment in the sector not many of the other labour marketplaces has taken off like Uber has, and there are rumours that a couple of the larger ones are struggling to make their unit economics work. A thorough strategy piece analysing the different players and their models would be a very interesting read.

If this topic interests you check out Azeem Azhar’s email newsletter The Exponential View. It’s where I saw the link to the O’Reilly article.

Sharing a sense of wonder: Brand and messaging for startups

By | Startup general interest | No Comments

The best startups create a sense of mission that transports customers and investors to a place in the future where the possibilities are wonderful. “Have all the worlds information at your fingertips” was exciting for Google’s investors and customers, and closer to home from our portfolio “Dress well with no hassle” is similarly exciting for’s customers and shareholders today.

In a post titled Brand first Arnold Waldstein put it this way:


When you pitch your vision you are sharing a sense of wonder. A sense of personal possibility.

It’s  your job to do the same thing for the market when you are launching your product.

Where what you believe becomes a large part of what the market adopts. Where your sense of inspiration around an idea becomes the customers sense of wonderment around how it works for them.

Dwell on some of these words for a minute, particularly ‘wonder’, ‘personal possibility’, and ‘sense of inspiration’. They’re powerful.

What Arnold’s written here can be used to think about the strength of a mission. Is there a sense of wonder? Does it let people dream about possibilities?

It’s easy to think how this test works with exciting consumer companies, but it works for all companies if you allow that the sense of wonder and possibilities need only apply to target customers. For example, I imagine that manufacturers of food packaging companies were inspired by the possibilities for Tetra Pak when they first heard about it.

Tips for productive advisor-entrepreneur conversations – argue intelligently and criticise kindly

By | Startup general interest, Uncategorized | 4 Comments

A couple of days ago I wrote that startup advice should focus on the ‘why’ and the ‘what’. Today I’m going to write more about how to do that.

A common pattern is for advisors to pattern match with something they’ve seen before and come quickly to a piece of advice that feels right to them. That’s great and hugely valuable when it chimes with the entrepreneurs intuition, but when it doesn’t the dialogue can deteriorate to brute force persuasion and sullen acceptance or passive resistance.

Focusing on ‘why’ the advice is appropriate is a big help, as I wrote about last time, but getting into the right frame of mind emotionally and attitudinally is also a big deal:

  • Think of areas of disagreement as opportunities to learn. Don’t avoid difficult conversations for fear of getting advice you don’t wan’t to implement or having your advice ignored.
  • Make it your goal to find the best solution, not to win the debate.
  • Listen first and then debate second. If you can summarise what you’ve heard in words the other side would use, list your points of agreement, and note anything you’ve learned before you go to say your piece.

Not every conversation can end productively, but the hit rate can be increased, and with that comes learning, better insight and ultimately business success.

This post was inspired by a summary of philosopher Daniel Dennett’s thinking about arguing intelligently and criticising kindly.


Using The Path Forward to determine fundraising strategy

By | Forward Partners, Startup general interest, Uncategorized | 2 Comments


As you might have seen we launched The Path Forward last week as a guide for ecommerce and marketplace entrepreneurs in their first year (diagram above). We’ve been using it internally for a while and we’ve noticed that we find it easiest to get excited about startups that are at Step 1: Valid Idea, and Step 3: Valuable Business. When we meet new companies at Step 2: Valued Product, entrepreneurs have made choices and started down a path which inevitably shuts off some opportunities that were there earlier but they haven’t got far enough along to know whether those choices are good.

It turns out we’re not alone. I saw this on Founders Notebook earlier today:

You can only raise money by pitching the “Dream” or by selling “Traction”. So either bootstrap your startup, or raise money in the early “dream” (no code, no plan, just a dream) phase or in the “traction” (the model is working) phase of your business.

The Path Forward is a good tool for understanding what makes a good dream and what qualifies as good traction. To summarise what’s on the site, pitching a “Dream” works best when the need has been proven with customers and a prototype really resonates, whilst pitching traction works best when the business looks set to scale. If you want more detail go to The Path Forward, click on the ‘About the Path Forward’ button and check out the definitions of Step 1: Valid Idea and Step 3: Valuable Business and associated Waypoints. (“Waypoints” is the name we’ve given to the sub-steps you can see in the graphic above.)



Startup advice should be strong on the ‘why’ and the ‘what’

By | Startup general interest | 2 Comments

I just read a great post titled Dear startup advisors, you don’t always need to be right, but you have to be solid. Forward Partners is very much in the business of startup advice so I was keen to read what Phin Barnes from First Round had to say.

As I say, it’s a good post and well worth reading in it’s entirety. What follows are the money quotes and the rest of the post is largely an example from when Phin was an entrepreneur that really brings the point home.

Quote 1:

the most valuable advisors deliver clarity of thought and structured arguments that can be climbed step by step or taken apart piece by piece

and, Quote 2:

I could never get a solid grip on advice summarized by, “I’ve seen this before + instinct = decision.”

To me this works because ‘clarity of thought’ and ‘structured arguments’ help founders understand why they should be doing something as well as the what they should do, whereas the pattern recognition and gut feel in quote 2 only delivers on the ‘what’. Founders get contradictory advice all the time (in his post Phin describes how one of his investors advised him to launch on Xbox and the other on Playstation) and making an intelligent choice between contradictory advice is only possible if the ‘why’ is present as well as the ‘what’.

I hear advisors venting frustrations about CEOs that aren’t following their advice all the time. I even do it myself sometimes :). Going forward I will think about whether I’ve explained the ‘why’ as well as the ‘what’. Figuring out the ‘why’ takes work and some advisors either can’t or won’t take the time to make their thoughts clear and to structure their arguments. That’s not so helpful. Once the why has been explained if there’s still a disagreement as to what should be done then the reason should be clear, which makes it much less frustrating.

My advice to founders and CEOs is to help advisors unpack their instincts and explain the ‘why’ as well as the ‘what’. When advisors are drawing on experience ask questions to explore what they are remembering, why things worked out well last time, and then get into detail on the similarities and differences between the what happened in the past and the current situation. Most advisors will welcome this discussion, it makes them smarter and makes them feel valued. Conversations where advice is passed and then ignored are much less satisfactory.

More evidence that traditional ad models are challenged

By | Advertising, Facebook | 3 Comments


Figures are in billions. 2015 figures are projections for the full year.

I’ve long thought that overload of messages in our lives is leading to ad-blindness and that paid business models are increasingly more attractive. This chart I just saw on Techcrunch re-enforces that view.

In-app purchases are still a relatively new phenomenon and many companies and industries are still figuring out how to get the most from them. Games makers have got it down pat now, but other content companies not so much. There’s still lots of growth to come.

Mobile ads I’m not so sure about. Large properties with sophisticated targeting will continue to do well and it will be interesting to see where Facebook, Twitter, and the big messaging companies go next. Smaller properties and the various ad networks they work with may have a tougher time, particularly now Apple has enabled ad-blocking in iOS 9.

Note that Facebook’s mobile ad revenues were $2.9bn in Q2 and are growing 60% year on year. If you backed them out of the purple bars in the chart above then there wouldn’t be much growth left.

Volume of global ecommerce exits growing nicely

By | Ecommerce, Startup general interest, Uncategorized | No Comments

CB Insights posted this chart on Twitter today. As you know at Forward Partners we’re ecommerce and marketplace investors, so we like to keep tabs on all aspects of the ecommerce market.

Historically there haven’t been many exits in ecommerce, so it’s good to see the number rising. I think this trend has some way to go because ecommerce penetration is still only in the low teens in the UK and US and is lower still in many other countries.

To really kickstart the exit market we need a few more huge ecommerce businesses to compete with Amazon. That would unlock the sort of strategic exits we’ve seen in software and consumer internet over the years.

Until then it’s important to make sure the fundamentals of a company add up so that they will be able to make substantial profits once they hit scale.

Launching The Path Forward

By | Forward Partners, Startup general interest | No Comments


As regular readers will know at Forward Partners we’ve been working with idea stage entrepreneurs for over two years. During this time we’ve seen the same patterns play out again and again and we’ve developed a suite of tools and tactics to help our partners. We’ve pulled those thoughts into a framework for ecommerce and marketplace entrepreneurs called The Path Forward that we launched at our #FPLive event last night.

I’m excited about this. I think The Path Forward has real depth both as a guide to help founders set priorities and as a practical tool to help with execution.

The graphic above illustrates how we’ve seen it work best for companies, and that’s to focus first on making sure the idea is valid, and then on building a valued product, and then turn to building a valuable business. Moving prematurely to the product or business Steps is counterproductive. Underneath each of the Steps we’ve set out the Waypoints companies should achieve to know they are ready to move onto the next Step.

On The Path Forward site there’s more detail about each of the Steps and Waypoints and then a set of highly practical articles and case studies organised under the Steps and Waypoints structure. For example under the Right Skills Waypoint (Step 1 Valid Idea) there’s an article titled Agency, outsource, or do it yourself?  and under the Growing Product Waypoint (Step 2 Valued Product) there’s an article about Channel testing, initial CPCs & judging scalability.

These articles were written by members of the Forward Partners startup and growth team (Leo Tsementzis and Tom MacThomas) and indeed all the content so far has come from us. We will continue to contribute new articles each week and hope that startup folk more broadly will also start chipping in so The Path Forward becomes a community owned project.

So we’d love you to get involved.

Here’s what you can do next:

And, if you like what we’re doing, please share!


Wearables may make tech less intrusive

By | Startup general interest | One Comment

I believe that developments in technology have been behind much of the progress we have seen in society – e.g. recent declines in the number of people who live in hunger – but as with almost everything there is a good and a bad side. One aspect of technology that I’m not keen of is the way that it sometimes seems to control us rather than being a tool that we use. Without discipline we can be slaves to our smartphones.

Mark Suster’s recent post about not taking his iPhone into the bedroom is an interesting read on this topic.

Many have worried that wearables, particularly smart watches, will make this problem worse. They will be another source of distraction that takes our attention away from our loved ones, friends, and colleagues to the detriment of our happiness, at least over the long term.

Another school of thought is that wearables may make the digital encroachment problem better. The line of argument is that subtle reminders on the wrist take less time to interact with and remove the chance that we will get lost in email or Twitter when we got the phone out of our pocket to do something like check directions on a map.

Consider this example from the invisionapp blog:

A few weeks ago, I was in New York City for a conference. It was my second day with my Apple Watch, so I thought I’d use it to find my way back from the venue. Before, I would have pulled out my phone, typed in the address, set it to walking directions, and spent the walk glancing between my phone and the street, trying to avoid cabs, cyclists, and the costumed characters of Times Square.

This time, I just said “Get me to the W Hotel in Times Square,” hit start, and walked—never bothering with the watch until I felt taps indicating it was time to turn.

It fundamentally changed my interaction with the city. Instead of being glued to the screen, I took in the sights and sounds and just trusted the watch to tell me where to go next. I didn’t check my mobile devices until the exact time and place I needed to, and it was liberating.

It’s early days for wearables and whether they increase or reduce digital encroachment depends on what people want and how apps are designed. I sense there’s an opportunity to bend tech in a positive direction though. Users increasingly want the best technology has to give them, but with the minimum of distraction and if some of the early successful apps deliver on that promise then others will doubtless follow. And that would be a good thing.

Desirable growth from a startup: AirBnB case study

By | Startup general interest, Venture Capital | 3 Comments

AirBnB growth

The chart above shows the number of guests AirBnB has hosted each summer for the last five years. It was on Techcrunch this morning.

It’s an amazing chart. AirBnB has delivered on the proverbial hockey stick growth that I imagine they had in their pitch deck back in 2010. They’ve lived the dream.

We can draw lessons for this for new startups. In particular for founders who plan to emulate the success of AirBnB.

First, two facts:

  • If you do the maths then 353x growth in five years works out at 3.2x per year, compounded
  • Also note that growth gets harder with size – eyeballing the chart suggests AirBnB was in the 2-3x range for the last couple of years

This means that founders who want to grow as fast as AirBnB should be growing at well over 3.2x in their early years. For very young companies the forecasts should show this level of growth, whilst companies at Series A or later will have to have shown this level of growth in the past as well as in their forecasts.

Not every company needs to have the ambition of reaching AirBnB’s $25bn valuation (although that’s what the biggest and best funds are looking for) but if you want to get to any kind of scale in five years then the maths shows that 3x growth is what you need in the early years. We advise our partner companies that 20-30% growth per month puts them in good shape to raise a Series A. These companies are typically in their first or second year and therefore growing off a small base, and they don’t usually manage this level of growth every month for a twelve months in a row, but if they did it would make them 9-23x up over the year.

Get Social

Blog Newsletter Sign Up

Enter your Email:
Preview | Powered by FeedBlitz