Wednesday, December 31, 2014
Checking the Principles for Responsible Investment in 2014
I attended a confab of local investment pros at the Commonwealth Club in December 2014, appropriately enough just before Christmas. The Principles for Responsible Investment (PRI) initiative released its progress report for 2014 back in October, so naturally it takes money managers almost two months to figure out what it means. It made for the perfect segue into how asset managers implement ESG criteria.
Experts from Bernstein Global Wealth Management, BlackRock, Nelson Capital, and TriLinc Global held forth on how they manage money. I have no business relationship with any of those firms, although I have invested in BlackRock's iShares securities in past years. I also have no relationship with the sponsors MSCI, Parnassus Investments, and Industry Capital. I tried very hard to launch a career as a portfolio manager with large investment firms, and every firm I encountered said my military background was a disqualifier. I must therefore be very skeptical of what professional money managers have to say about how they apply theory in reality.
The panelists admitted that the $45 trillion figure quoted in the event's title was just a guess. Well, there goes their credibility right down the tubes. Analysis comes from data, and leading practitioners who can't cite reliable statistics from PRI or elsewhere should stay off the platform until they can get their stories straight.
The "responsible investing" rubric covers ESG criteria and impact investing. It started with negative screens that eliminated objectionable stocks from actively managed portfolios. Money managers tried to address the concerns of some institutional clients' investment policy statements that prohibited owning stocks exposed to alcohol, gambling, and other controversial sectors. The evolving thesis is that reducing a company's ethical and environmental risks will raise its valuation. It is a compelling thesis addressing the supply side of providing attractive investment products. I need to see matching demand data proving Millennials and others want to buy responsible investments.
I have known about the Sustainability Accounting Standards Board (SASB) since 2013. It has not yet overtaken FASB in prestige. Advocates could probably use a hearing in front of the SEC to make that happen. Public companies will hesitate to adopt SASB standards without a regulatory push. CFOs already have a full plate with Sarbox compliance and IASB rules for their multinational operations.
I suspect that the extra effort going into responsible investing causes a larger tracking error when portfolio managers measure their alpha against a benchmark. Tweaking the benchmark is not a satisfactory solution. Independent studies of the tracking error acceptable in risk budgets will inform responsible investing decisions.
A large body of evidence substantiates the weakness of divestiture as a response to unpalatable investments. Someone else always comes along to buy what others throw away. The current trend among overly sensitive portfolio managers to divest from carbon-heavy energy companies is a perfect case. Oil and gas stocks still make money, and plenty of people will buy them even if fourth-generation Rockefellers turn up their noses.
Stock exchange listing requirements can play a leadership role in responsible investing. Solid ESG regulations can deter companies from exploiting regulatory arbitrage by listing on a less restrictive exchange. Exchanges in multiple countries will have to adopt ESG guidelines simultaneously.
Responsible investing has a future. Alfidi Capital does not yet have an ESG policy. That may change in 2015.
Experts from Bernstein Global Wealth Management, BlackRock, Nelson Capital, and TriLinc Global held forth on how they manage money. I have no business relationship with any of those firms, although I have invested in BlackRock's iShares securities in past years. I also have no relationship with the sponsors MSCI, Parnassus Investments, and Industry Capital. I tried very hard to launch a career as a portfolio manager with large investment firms, and every firm I encountered said my military background was a disqualifier. I must therefore be very skeptical of what professional money managers have to say about how they apply theory in reality.
The panelists admitted that the $45 trillion figure quoted in the event's title was just a guess. Well, there goes their credibility right down the tubes. Analysis comes from data, and leading practitioners who can't cite reliable statistics from PRI or elsewhere should stay off the platform until they can get their stories straight.
The "responsible investing" rubric covers ESG criteria and impact investing. It started with negative screens that eliminated objectionable stocks from actively managed portfolios. Money managers tried to address the concerns of some institutional clients' investment policy statements that prohibited owning stocks exposed to alcohol, gambling, and other controversial sectors. The evolving thesis is that reducing a company's ethical and environmental risks will raise its valuation. It is a compelling thesis addressing the supply side of providing attractive investment products. I need to see matching demand data proving Millennials and others want to buy responsible investments.
I have known about the Sustainability Accounting Standards Board (SASB) since 2013. It has not yet overtaken FASB in prestige. Advocates could probably use a hearing in front of the SEC to make that happen. Public companies will hesitate to adopt SASB standards without a regulatory push. CFOs already have a full plate with Sarbox compliance and IASB rules for their multinational operations.
I suspect that the extra effort going into responsible investing causes a larger tracking error when portfolio managers measure their alpha against a benchmark. Tweaking the benchmark is not a satisfactory solution. Independent studies of the tracking error acceptable in risk budgets will inform responsible investing decisions.
A large body of evidence substantiates the weakness of divestiture as a response to unpalatable investments. Someone else always comes along to buy what others throw away. The current trend among overly sensitive portfolio managers to divest from carbon-heavy energy companies is a perfect case. Oil and gas stocks still make money, and plenty of people will buy them even if fourth-generation Rockefellers turn up their noses.
Stock exchange listing requirements can play a leadership role in responsible investing. Solid ESG regulations can deter companies from exploiting regulatory arbitrage by listing on a less restrictive exchange. Exchanges in multiple countries will have to adopt ESG guidelines simultaneously.
Responsible investing has a future. Alfidi Capital does not yet have an ESG policy. That may change in 2015.
Tuesday, December 30, 2014
Alfidi Capital at Data Connectors San Francisco Tech Security Conference 2014
Data Connectors has a full schedule of tech security road shows across America. I attended their Tech Security Conference this December when it rolled into San Francisco. I had to get my fill of cyber defense knowledge while I filled up on free coffee. My completely subjective reaction to the many highly qualified IT presenters will now follow.
The electronic recycling industry is seriously big business. It gets bad press when some recyclers resell hardware without wiping hard drives. That's how pirates access unencrypted personal data. The best recyclers chop up every electronic component, recover metals, and process hard cases into plastic pellets. The State of California Department of Toxic Substances Control (DTSC) knows all about processing hazardous e-waste. Recyclers in this state must register with DTSC. They should also apply OHSAS 18001 and the relevant ISO standards if they're serious about recycling. Clearing and overwriting old hard disks are less complete safeguards than physical destruction. I'll remember that the next time I turn in an obsolete laptop for recycling.
WiFi networks should have commonly available design templates. Lack of such templates is one reason municipalities have been stymied in their efforts to create free WiFi infrastructure. Wireless Networking in the Developing World has obvious solutions for countries that do not have to overcome legacy land line infrastructure. The Network Startup Resource Center (NSRC) published a number of administrative guides for Internet architecture. Public domain WiFi design is an under-resourced area in telecom. More attention from open source designers would speed WiFi adoption.
Cyber security pros should talk more about being proactive. Lockheed Martin's Cyber Kill Chain process is the best definition of how business intelligence fits into cyber security. Brian Krebs' Spam Nation offers insights into unwanted emails as attack vectors. Enterprises developing their own apps still leave them riddled with vulnerabilities for the sake of convenience. They should change that approach before the huge amounts of bandwidth their apps require for sharing files and videos become attack vectors.
Experts on hand claimed the titles of CIO, CTO, and CISO are becoming interchangeable. That is lamentable. I say they should be distinct in an enterprise. Come on, it's simple. The CIO is the overall IT boss with the CTO, CISO, and Chief Data Officer (CDO) as direct reports. The CTO's portfolio includes the IT infrastructure, SDLC, hardware LCM, and the lead effort on DevOps. The CISO handles security for the network and devices. The CDO develops the data supply chain and supports the CTO's DevOps. I totally disagree with one speaker who claimed a CDO can replace a COO. Really? Maybe in some software firms, but not in the rest of the economy.
One person mentioned that poor data center architecture invites external threats. NIST's Advanced Encryption Standard (AES) is at best a partial solution; data centers cannot ignore physical security. Perimeter barriers and physical gaps are not scalable security measures in large organizations. None of the speakers mentioned knowledge management (KM), but that drives security classification and network access privileges. There is no one universal technology stack but several baselines exist. An open UMA is one way to manage access to parts of a stack but IT people need a fuller understanding of that protocol's privacy implications.
Email retention policies can look to legal guidance that varies by sector. California's email retention requirements are clear for its state government agencies but less clear for the private sector. FINRA and the SEC have detailed guidance for data retention in the financial sector. Once again, there is no universally applicable standard. The EU invalidated its Data Retention Directive this year over privacy concerns. I cannot locate any industry association source for a data retention standard.
Data loss prevention (DLP) requires data loss detection (DLD). If you don't know something's gone, you won't know how to recover it. The SANS Institute has a white paper on DLD and DLP open source tools; use their search function with those phrases for good info. A Web search of "DNS vulnerability" brings up reports from the SEI CERT, IANA, and a few tech experts. Prolexic's Quarterly Global DDoS Attack Report provides regular threat updates. The IT community has learned to police itself of spoofing with the Open Resolver Project. Plenty of thieves want to get their hands on enterprise data.
Collaboration opens up a whole new can of worms now that the cloud and BYOD are norms. Cloud Security Alliance members should have some idea of how to use ISO 27001. US-based multinational enterprises must also know ITAR and other US government export controls apply to their cloud services, as does FISMA if they do business with Uncle Sam. The financial sector figured out collaboration long ago with its FIX protocol, so IT pros should check with the FIX Trading Community to watch information exchange done right.
The Ponemon Institute's annual Cost of Data Breach Study makes the IT community's case to CFOs for investments in network security. Advanced persistent threats (APTs) have a defined life cycle that only a conscious actor can maintain. NSS Labs and ICSA Labs do plenty of independent testing for platforms at risk of breach. The Anti Virus Information Exchange Network (AVIEN) and the Anti-Phishing Working Group (APWG) share knowledge in the fight against cyber crime.
I have noticed that the "Ed Snowden look" of scraggly facial hair and wire rim glasses is popular among techies. It's even in ads for tech sector companies. Brogrammers can relate to that image but it may turn off women who want IT careers. Getting more women - especially attractive ones - into cyber security would be a really great thing. Attending these Tech Security Conferences is the place for them to start. I'd be happy to escort them in myself, if you know what I mean.
The electronic recycling industry is seriously big business. It gets bad press when some recyclers resell hardware without wiping hard drives. That's how pirates access unencrypted personal data. The best recyclers chop up every electronic component, recover metals, and process hard cases into plastic pellets. The State of California Department of Toxic Substances Control (DTSC) knows all about processing hazardous e-waste. Recyclers in this state must register with DTSC. They should also apply OHSAS 18001 and the relevant ISO standards if they're serious about recycling. Clearing and overwriting old hard disks are less complete safeguards than physical destruction. I'll remember that the next time I turn in an obsolete laptop for recycling.
WiFi networks should have commonly available design templates. Lack of such templates is one reason municipalities have been stymied in their efforts to create free WiFi infrastructure. Wireless Networking in the Developing World has obvious solutions for countries that do not have to overcome legacy land line infrastructure. The Network Startup Resource Center (NSRC) published a number of administrative guides for Internet architecture. Public domain WiFi design is an under-resourced area in telecom. More attention from open source designers would speed WiFi adoption.
Cyber security pros should talk more about being proactive. Lockheed Martin's Cyber Kill Chain process is the best definition of how business intelligence fits into cyber security. Brian Krebs' Spam Nation offers insights into unwanted emails as attack vectors. Enterprises developing their own apps still leave them riddled with vulnerabilities for the sake of convenience. They should change that approach before the huge amounts of bandwidth their apps require for sharing files and videos become attack vectors.
Experts on hand claimed the titles of CIO, CTO, and CISO are becoming interchangeable. That is lamentable. I say they should be distinct in an enterprise. Come on, it's simple. The CIO is the overall IT boss with the CTO, CISO, and Chief Data Officer (CDO) as direct reports. The CTO's portfolio includes the IT infrastructure, SDLC, hardware LCM, and the lead effort on DevOps. The CISO handles security for the network and devices. The CDO develops the data supply chain and supports the CTO's DevOps. I totally disagree with one speaker who claimed a CDO can replace a COO. Really? Maybe in some software firms, but not in the rest of the economy.
One person mentioned that poor data center architecture invites external threats. NIST's Advanced Encryption Standard (AES) is at best a partial solution; data centers cannot ignore physical security. Perimeter barriers and physical gaps are not scalable security measures in large organizations. None of the speakers mentioned knowledge management (KM), but that drives security classification and network access privileges. There is no one universal technology stack but several baselines exist. An open UMA is one way to manage access to parts of a stack but IT people need a fuller understanding of that protocol's privacy implications.
Email retention policies can look to legal guidance that varies by sector. California's email retention requirements are clear for its state government agencies but less clear for the private sector. FINRA and the SEC have detailed guidance for data retention in the financial sector. Once again, there is no universally applicable standard. The EU invalidated its Data Retention Directive this year over privacy concerns. I cannot locate any industry association source for a data retention standard.
Data loss prevention (DLP) requires data loss detection (DLD). If you don't know something's gone, you won't know how to recover it. The SANS Institute has a white paper on DLD and DLP open source tools; use their search function with those phrases for good info. A Web search of "DNS vulnerability" brings up reports from the SEI CERT, IANA, and a few tech experts. Prolexic's Quarterly Global DDoS Attack Report provides regular threat updates. The IT community has learned to police itself of spoofing with the Open Resolver Project. Plenty of thieves want to get their hands on enterprise data.
Collaboration opens up a whole new can of worms now that the cloud and BYOD are norms. Cloud Security Alliance members should have some idea of how to use ISO 27001. US-based multinational enterprises must also know ITAR and other US government export controls apply to their cloud services, as does FISMA if they do business with Uncle Sam. The financial sector figured out collaboration long ago with its FIX protocol, so IT pros should check with the FIX Trading Community to watch information exchange done right.
The Ponemon Institute's annual Cost of Data Breach Study makes the IT community's case to CFOs for investments in network security. Advanced persistent threats (APTs) have a defined life cycle that only a conscious actor can maintain. NSS Labs and ICSA Labs do plenty of independent testing for platforms at risk of breach. The Anti Virus Information Exchange Network (AVIEN) and the Anti-Phishing Working Group (APWG) share knowledge in the fight against cyber crime.
I have noticed that the "Ed Snowden look" of scraggly facial hair and wire rim glasses is popular among techies. It's even in ads for tech sector companies. Brogrammers can relate to that image but it may turn off women who want IT careers. Getting more women - especially attractive ones - into cyber security would be a really great thing. Attending these Tech Security Conferences is the place for them to start. I'd be happy to escort them in myself, if you know what I mean.
Monday, December 29, 2014
Sunday, December 28, 2014
The Limerick of Finance for 12/28/14
The euro is hitting the rails
Greek observers are biting their nails
New political mess
Brings currency stress
Expect chaos if next bailout fails
Greek observers are biting their nails
New political mess
Brings currency stress
Expect chaos if next bailout fails
Saturday, December 27, 2014
The Haiku of Finance for 12/27/14
Cheaper gas pump price
Refining from huge supply
Demand hit speed bump
Refining from huge supply
Demand hit speed bump
Friday, December 26, 2014
Thursday, December 25, 2014
Wednesday, December 24, 2014
The Haiku of Finance for 12/24/14
Yuletide spending spree
More debt no one can afford
Buying household junk
More debt no one can afford
Buying household junk
Tuesday, December 23, 2014
Alfidi Capital Attends Location and Context World 2014
San Francisco is my usual location, in the context of finding material for some provocative blogging. That's all the reason I needed to attend Location and Context World this December. I couldn't go wrong with exposure to three days of expertise that blended real-time data, geographic information systems, and mobile apps. I expect location based services to emerge as a subset of the data sector. Pioneering a new sector means launching a new conference series like this one to cover it.
The pre-conference CIO workshop had a bunch of us overachievers generating ideas for retail use cases, enterprise cultural approaches to user privacy, and deployment methods for location tracking. The 14 of us generated and critiqued 287 ideas in three hours. That was about 20 ideas per participant, and I'm pretty sure my ideas were the most articulate. My suggestions: CX by location; loss prevention risk factors; Big Data analytics linking back-end streams. I don't know if any of my CIO-related comments will end up in a Gartner or Forrester report, so I'll share them below.
Linking opt-in protocols to customer rewards and loyalty programs is always a compelling incentive to get users past that first data input hurdle. Enterprises should specify in their privacy policies that they own location data for a user who enters their store. User data can be abused if taken out of context, and accusations of racial profiling come to mind as a potential liability. Cross-referenced data for demographic elements other than race can counter those charges. Opting out in an environment of ubiquitous computing is hard, so the only way of doing so completely may be to just turn off one's smartphone when entering a store. Opting out of anything after completing a transaction is probably impossible because a user's data history is so easily monetized. Some CXs can cross the line between convenience and invasiveness. Only a Chief Privacy Officer can draw that line where outliers of use case data won't cross it. Life cycle management (LCM) needs more attention; LCM will accelerate, become more complex, and incorporate Cloudonomics. Finally, I don't know whether retailers have though about how the WiFi spectrum may get crowded indoors with POS terminals, multiple smartphones, and in-store surveillance competing for airwaves.
The first day's analyst roundtable on transforming customer and employee interaction made me wonder whether developers in mobile, enterprise, and Big Data truly work together on integrated products. The app sector needs consolidation. I want "data sector" enterprise players to look seriously at vertical integration with data merchants. Where is the evidence that mobile apps successfully manage workflows? Mobile displays need simple dashboards, but handling workflows means tapping through several layers of deep dives. Furthermore, mobile use in field services will need customizable dashboards that make workflows take a back seat to troubleshooting. I can already see mobile power users getting heavy volumes of push notifications from the enterprise as a workflow method. The difficulty is that responding to those notices forces mobile field reps to be reactive instead of proactive problem-solvers. There goes mobile empowerment, thanks to workflow requirements. Enterprise systems must inevitably be dumbed down for mobile users. It's sad that field reps won't have much autonomy once some combination of push notices and simple dashboards constrict mobile use.
I suspect the difference between "proximity marketing" and "location marketing" is negligible. One of those terms will win out when the tech media start hyping one. Beacons are a hot item in enabling infrastructure and their makers don't care which term wins. I don't know whether beacons really eliminate the need to spam mobile users by allowing consumers' digital lives to follow them into the physical world. Many users consider ads on their Facebook news feeds to be spam. Cueing up those ads based on social media actions means beacons are still in the spam chain by enabling proximity marketing pushes. Here's my suggested critical path for beacon adoption: 100 CustDev use cases . . . improvements in conversion rate and shopping basket size . . . Cloudonomics ROI of proposed beacon solution. Inserting hyperlocal data into a customer journey map will define the CustDev segment that makes this adoption work.
Enterprises have discovered telematics and it's not just for automobiles. Ambient energy sources for IoT devices must have a sufficient power budget for edge computing. Geospatial precision matters for remote devices and lidar sensors have found a market. Context doesn't matter so much for remote IoT devices but it is very important in defining a retail UX. Little Data is really Big Data sliced into location and context.
Jonah Berger's STEPPS concept helps location marketers reverse engineer a successful word-of-mouth campaign template. Pre-store engagement metrics work backwards from the POS, not just from social media channels. The "near-store" effort requires geo-targeting. Proximity triggers (geo-fences, beacons) lead to higher conversion rates. This quantifies the value of marketing campaigns incorporating location because a customer's actions at each gateway (pre-store, near-store, in-store) are tracked. Forrester advises us to measure "mobile moments." The thought leaders at this conference proposed using measuring media actions in pre-store moments, mobile app actions in near-store moments, and beacon cues in the in-store moments.
A couple of panel participants discussed how their enterprises tested in-store apps before a national rollout. The biggest retail chains devote DevOps to internal labs and make acqui-hires for IT talent. One IT mercenary claimed that data mining could generate frictionless growth by reducing subscriber churn in membership services. That is an efficient tactic for SMBs who do not have the funds to deploy beacons and sensor farms. The SMBs that know the total cost of ownership (TCO) of a plug-and-play location-based solution can easily figure the ROI of a full deployment, just like that mercenary IT dude.
I sat through one startup pitch from a solution in search of a problem. They had a calendar-based app but were so stupid that they had not thought of a monetization strategy before launching. Every failed '90s dot-com made that mistake. Business models like these suffer from the cold start problem because they have not attracted a large enough user base to offer generalizable AI output. Solving it forces founders to address a chicken or the egg problem with a choice between going for user traction with a basic product or deploying a more advanced product after more AI tweaking. All of the software thought leaders I've seen in the past three years advocate iterative deployments through constant CustDev and A/B testing to get through these two related problems. Startups that haven't figured this out are not worth my time.
The second day's analyst roundtable introduced me to augmented reality shopping. I don't spend enough time in stores to benefit from augmented reality but a couple of years ago I did see some POS concepts enabling consumer choices. Every time someone in tech makes a bullish prediction on smartwatches, I remind myself of the challenges of the watch display's small form factor. It can show one or two data points in large type and probably no more than three more in very small type (four are possible if the background color's shading conveys something substantial). I did learn a couple of cool things. First, retailers may encrypt beacons to work only with their branded apps. Second, a closed-loop service app initiates user contact that will lead to a yes/no sales decision, much like a live sales rep's closed-end question driving a conversion. Thanks, SNL Kagan, for sending a hot babe analyst to explain these things.
Newcomers to location-based services should know that "O2O" means online-to-offline commerce. Tech media have hyped it for several years as a huge untapped opportunity. If it were really so huge, there wouldn't be such a large ecosystem of e-commerce apps corralling consumers into staying online all the time. Think about it. The whole premise of beacons pushing location-based notices is that consumers are never offline. A better approach to keeping customers engaged is "locationomics." Do a Web search for that term. Informa Telecoms and Media organized this conference and claims to have coined the term. No one paid me anything to say that. The Location Forum defines locationomics and LBx Journal covers it regularly.
Tech superstar Robert Scoble came to plug his book The Age of Context. He revealed that smartphones now have installed beacons, which strikes me as redundant if physical stores have their own beacons to query smartphones. A smartphone with its own beacon might be useful for querying a purely mobile vendor (like a food truck or a custom delivery service) but that's a very limited . . . context. Come on, you knew I would deploy that one.
One presenter displayed Beecham Research`s Wearable Technology Application Chart. I think it's the most mind-blowing corporate thing I have seen all month. It reminds me of the rock band Journey's album covers from the early 1980s, the ones with the scarab launching into outer space and doing other trippy things. Hunt down that groovy chart yourself, because I won't repost it here. It's one of those things destined to live on in Web lore.
One irony of LBS I noticed is that virtual reality (VR) minimizes the need for physical movement. VR devices that disrupt travel and commuting mean LBS growth won't be nearly as pronounced. The race between LBS and VR will define which business models dominate the next generation of e-commerce. Competing standards for M2M and IoT interfaces will hinder this dominance until one breakthrough product builds an ecosystem that forces other aspirants to fall in line behind one standard.
The IT people at this conference must be getting chewed out a lot by their CFOs, because some have finally realized that allocating DevOps budgets between incremental opex and capex affects project ROI. CIOs who tie their SDLC and LCM to the enterprise's capital budget are winners in the C-suite. One presenting CTO claimed that incremental changes, personalized workflows, and push notices create context. Okay dude, that's an extremely insular focus that ignores customers and runs into the problems with workflows I described above. Shoppers who "showroom" by comparing in-store prices before making online purchases go around such insular CTOs.
Leave it to Google to deliver a talk that makes sense. The Google rep on hand said cost per visit is a good KPI measuring the cost effectiveness of omni-channel marketing. I'll take that suggestion further along a roadmap to success. Find the most-clicked item on a website (i.e., a retail shopping portal). Maximize that link's visibility in social media and web searches. Use rich media to enhance its details, especially if it has embedded images or video. I suspect this tactic is more powerful than linkbait or figuring the number of positive product reviews needed to overcome a negative review.
The venture investors present did more than just talk their books. They think LBS can multiply the network effect of a first-mover. I had not thought of crowdsourcing as a way to rapidly populate an original dataset, so perhaps that can overcome the cold start problem I mentioned above. Strategic acquirers may indeed want LBS in their data streams but that does not mean they will pay for large exit events from VC-backed LBS startups. Note above how I discussed the tendency of retail chains to develop their own LBS capabilities internally or through acqui-hires. The VCs who expect their startups to achieve billion-dollar exits need to lower their expectations. They may find more success in hardware than software given the attractiveness of beacons. They also need to quit harping on "proxies for growth" like downloads or media coverage. There is no such thing as a proxy for growth. Startups either grow their revenue or become worthless.
Location is easier to define than context. I define context as any monetizable or actionable option nested within multiple data streams tied to identity. This of course makes anonymity impossible but users won't mind giving up their privacy if they get value in return. Combining context with location further precludes anonymity. Go ahead and quote me. I'm pretty sure I'm ahead of Gartner and Forrester. My Google search for "digital context" brought up some Forrester commentary from a World Economic Forum panel on digital context; it offered little detail. Context is a brand new term for thought leaders like yours truly to claim. I generated more details in this one blog article here than most thought leaders on big-shot panels.
There were some really hot babes staffing this conference, especially the show's CEO. Maybe next time the unattached babes in attendance can show me some location-based services up in their hotel rooms. I could fit that into the context of my incredible manliness that women find irresistible. Alfidi Capital is way ahead of other financial sector players thanks to Location and Context World 2014.
The pre-conference CIO workshop had a bunch of us overachievers generating ideas for retail use cases, enterprise cultural approaches to user privacy, and deployment methods for location tracking. The 14 of us generated and critiqued 287 ideas in three hours. That was about 20 ideas per participant, and I'm pretty sure my ideas were the most articulate. My suggestions: CX by location; loss prevention risk factors; Big Data analytics linking back-end streams. I don't know if any of my CIO-related comments will end up in a Gartner or Forrester report, so I'll share them below.
Linking opt-in protocols to customer rewards and loyalty programs is always a compelling incentive to get users past that first data input hurdle. Enterprises should specify in their privacy policies that they own location data for a user who enters their store. User data can be abused if taken out of context, and accusations of racial profiling come to mind as a potential liability. Cross-referenced data for demographic elements other than race can counter those charges. Opting out in an environment of ubiquitous computing is hard, so the only way of doing so completely may be to just turn off one's smartphone when entering a store. Opting out of anything after completing a transaction is probably impossible because a user's data history is so easily monetized. Some CXs can cross the line between convenience and invasiveness. Only a Chief Privacy Officer can draw that line where outliers of use case data won't cross it. Life cycle management (LCM) needs more attention; LCM will accelerate, become more complex, and incorporate Cloudonomics. Finally, I don't know whether retailers have though about how the WiFi spectrum may get crowded indoors with POS terminals, multiple smartphones, and in-store surveillance competing for airwaves.
The first day's analyst roundtable on transforming customer and employee interaction made me wonder whether developers in mobile, enterprise, and Big Data truly work together on integrated products. The app sector needs consolidation. I want "data sector" enterprise players to look seriously at vertical integration with data merchants. Where is the evidence that mobile apps successfully manage workflows? Mobile displays need simple dashboards, but handling workflows means tapping through several layers of deep dives. Furthermore, mobile use in field services will need customizable dashboards that make workflows take a back seat to troubleshooting. I can already see mobile power users getting heavy volumes of push notifications from the enterprise as a workflow method. The difficulty is that responding to those notices forces mobile field reps to be reactive instead of proactive problem-solvers. There goes mobile empowerment, thanks to workflow requirements. Enterprise systems must inevitably be dumbed down for mobile users. It's sad that field reps won't have much autonomy once some combination of push notices and simple dashboards constrict mobile use.
I suspect the difference between "proximity marketing" and "location marketing" is negligible. One of those terms will win out when the tech media start hyping one. Beacons are a hot item in enabling infrastructure and their makers don't care which term wins. I don't know whether beacons really eliminate the need to spam mobile users by allowing consumers' digital lives to follow them into the physical world. Many users consider ads on their Facebook news feeds to be spam. Cueing up those ads based on social media actions means beacons are still in the spam chain by enabling proximity marketing pushes. Here's my suggested critical path for beacon adoption: 100 CustDev use cases . . . improvements in conversion rate and shopping basket size . . . Cloudonomics ROI of proposed beacon solution. Inserting hyperlocal data into a customer journey map will define the CustDev segment that makes this adoption work.
Enterprises have discovered telematics and it's not just for automobiles. Ambient energy sources for IoT devices must have a sufficient power budget for edge computing. Geospatial precision matters for remote devices and lidar sensors have found a market. Context doesn't matter so much for remote IoT devices but it is very important in defining a retail UX. Little Data is really Big Data sliced into location and context.
Jonah Berger's STEPPS concept helps location marketers reverse engineer a successful word-of-mouth campaign template. Pre-store engagement metrics work backwards from the POS, not just from social media channels. The "near-store" effort requires geo-targeting. Proximity triggers (geo-fences, beacons) lead to higher conversion rates. This quantifies the value of marketing campaigns incorporating location because a customer's actions at each gateway (pre-store, near-store, in-store) are tracked. Forrester advises us to measure "mobile moments." The thought leaders at this conference proposed using measuring media actions in pre-store moments, mobile app actions in near-store moments, and beacon cues in the in-store moments.
A couple of panel participants discussed how their enterprises tested in-store apps before a national rollout. The biggest retail chains devote DevOps to internal labs and make acqui-hires for IT talent. One IT mercenary claimed that data mining could generate frictionless growth by reducing subscriber churn in membership services. That is an efficient tactic for SMBs who do not have the funds to deploy beacons and sensor farms. The SMBs that know the total cost of ownership (TCO) of a plug-and-play location-based solution can easily figure the ROI of a full deployment, just like that mercenary IT dude.
I sat through one startup pitch from a solution in search of a problem. They had a calendar-based app but were so stupid that they had not thought of a monetization strategy before launching. Every failed '90s dot-com made that mistake. Business models like these suffer from the cold start problem because they have not attracted a large enough user base to offer generalizable AI output. Solving it forces founders to address a chicken or the egg problem with a choice between going for user traction with a basic product or deploying a more advanced product after more AI tweaking. All of the software thought leaders I've seen in the past three years advocate iterative deployments through constant CustDev and A/B testing to get through these two related problems. Startups that haven't figured this out are not worth my time.
The second day's analyst roundtable introduced me to augmented reality shopping. I don't spend enough time in stores to benefit from augmented reality but a couple of years ago I did see some POS concepts enabling consumer choices. Every time someone in tech makes a bullish prediction on smartwatches, I remind myself of the challenges of the watch display's small form factor. It can show one or two data points in large type and probably no more than three more in very small type (four are possible if the background color's shading conveys something substantial). I did learn a couple of cool things. First, retailers may encrypt beacons to work only with their branded apps. Second, a closed-loop service app initiates user contact that will lead to a yes/no sales decision, much like a live sales rep's closed-end question driving a conversion. Thanks, SNL Kagan, for sending a hot babe analyst to explain these things.
Newcomers to location-based services should know that "O2O" means online-to-offline commerce. Tech media have hyped it for several years as a huge untapped opportunity. If it were really so huge, there wouldn't be such a large ecosystem of e-commerce apps corralling consumers into staying online all the time. Think about it. The whole premise of beacons pushing location-based notices is that consumers are never offline. A better approach to keeping customers engaged is "locationomics." Do a Web search for that term. Informa Telecoms and Media organized this conference and claims to have coined the term. No one paid me anything to say that. The Location Forum defines locationomics and LBx Journal covers it regularly.
Tech superstar Robert Scoble came to plug his book The Age of Context. He revealed that smartphones now have installed beacons, which strikes me as redundant if physical stores have their own beacons to query smartphones. A smartphone with its own beacon might be useful for querying a purely mobile vendor (like a food truck or a custom delivery service) but that's a very limited . . . context. Come on, you knew I would deploy that one.
One presenter displayed Beecham Research`s Wearable Technology Application Chart. I think it's the most mind-blowing corporate thing I have seen all month. It reminds me of the rock band Journey's album covers from the early 1980s, the ones with the scarab launching into outer space and doing other trippy things. Hunt down that groovy chart yourself, because I won't repost it here. It's one of those things destined to live on in Web lore.
One irony of LBS I noticed is that virtual reality (VR) minimizes the need for physical movement. VR devices that disrupt travel and commuting mean LBS growth won't be nearly as pronounced. The race between LBS and VR will define which business models dominate the next generation of e-commerce. Competing standards for M2M and IoT interfaces will hinder this dominance until one breakthrough product builds an ecosystem that forces other aspirants to fall in line behind one standard.
The IT people at this conference must be getting chewed out a lot by their CFOs, because some have finally realized that allocating DevOps budgets between incremental opex and capex affects project ROI. CIOs who tie their SDLC and LCM to the enterprise's capital budget are winners in the C-suite. One presenting CTO claimed that incremental changes, personalized workflows, and push notices create context. Okay dude, that's an extremely insular focus that ignores customers and runs into the problems with workflows I described above. Shoppers who "showroom" by comparing in-store prices before making online purchases go around such insular CTOs.
Leave it to Google to deliver a talk that makes sense. The Google rep on hand said cost per visit is a good KPI measuring the cost effectiveness of omni-channel marketing. I'll take that suggestion further along a roadmap to success. Find the most-clicked item on a website (i.e., a retail shopping portal). Maximize that link's visibility in social media and web searches. Use rich media to enhance its details, especially if it has embedded images or video. I suspect this tactic is more powerful than linkbait or figuring the number of positive product reviews needed to overcome a negative review.
The venture investors present did more than just talk their books. They think LBS can multiply the network effect of a first-mover. I had not thought of crowdsourcing as a way to rapidly populate an original dataset, so perhaps that can overcome the cold start problem I mentioned above. Strategic acquirers may indeed want LBS in their data streams but that does not mean they will pay for large exit events from VC-backed LBS startups. Note above how I discussed the tendency of retail chains to develop their own LBS capabilities internally or through acqui-hires. The VCs who expect their startups to achieve billion-dollar exits need to lower their expectations. They may find more success in hardware than software given the attractiveness of beacons. They also need to quit harping on "proxies for growth" like downloads or media coverage. There is no such thing as a proxy for growth. Startups either grow their revenue or become worthless.
Location is easier to define than context. I define context as any monetizable or actionable option nested within multiple data streams tied to identity. This of course makes anonymity impossible but users won't mind giving up their privacy if they get value in return. Combining context with location further precludes anonymity. Go ahead and quote me. I'm pretty sure I'm ahead of Gartner and Forrester. My Google search for "digital context" brought up some Forrester commentary from a World Economic Forum panel on digital context; it offered little detail. Context is a brand new term for thought leaders like yours truly to claim. I generated more details in this one blog article here than most thought leaders on big-shot panels.
There were some really hot babes staffing this conference, especially the show's CEO. Maybe next time the unattached babes in attendance can show me some location-based services up in their hotel rooms. I could fit that into the context of my incredible manliness that women find irresistible. Alfidi Capital is way ahead of other financial sector players thanks to Location and Context World 2014.
Monday, December 22, 2014
Sunday, December 21, 2014
The Limerick of Finance for 12/21/14
Oil prices swung back to a gain
Short sellers found new kinds of pain
Energy sector stocks
Have survived some shocks
Finding profit is still on the brain
Short sellers found new kinds of pain
Energy sector stocks
Have survived some shocks
Finding profit is still on the brain
Saturday, December 20, 2014
Friday, December 19, 2014
Thursday, December 18, 2014
Wednesday, December 17, 2014
Tuesday, December 16, 2014
Monday, December 15, 2014
Financial Sarcasm Roundup for 12/15/14
This particular batch of sarcasm uses the Commonwealth Club "Week to Week Political Roundtable" event for inspiration. I attended that panel tonight and listened to local journalists hold forth on some newsworthy events. I will address a few of those events below, laden with sarcasm that no one else in the financial sector can deliver.
The Salesforce Foundation is pushing its Pledge 1% program to startups. I first heard about this philosophy at Dreamforce 2013. It's hard for me to be sarcastic about something so generous, but I'm pretty sure only later stage startups or early-stage VC-funded startups have a chance of fulfilling the pledge. Any startups who can afford such a commitment are welcome to check out the official Pledge 1% site. The startups that make it work will somehow leverage their donations and employee contacts into new revenue streams. It's really a wake-up call for sharp CMOs to tie non-profit relationships into their marketing channels. If some employee's volunteer hours with the local soup kitchen merits a business development follow-up that closes some ERP software sales, then it's bonus time all around.
Uber has earned itself two more black eyes, first for charging surge pricing during the Sydney hostage crisis and then for one of its executives disputing something trivial with a landlord. Their PR head must be fuming. I recently blogged about Silicon Valley's jerk culture but no one with serious money seems to care. Facebook and Microsoft both had significant growing pains as they achieved monopolistic control of their sectors. They got over those episodes by bringing in experienced senior executives who grew up in other corporate cultures. Uber desperately needs an outsider to make a cultural hairpin turn before this taxi hits a guardrail.
The "cromnibus" federal spending bill is through Congress and headed to the President's desk. In case you missed it, the name is a hybrid of an "omnibus" normal appropriations bill and a "continuing resolution" for stopgap funding. It contained a special gift for Wall Street by weakening Dodd-Frank rules. The important lesson for the financial sector is that Washington still isn't serious about restoring fiscal sanity, regulating Wall Street, or enacting the entitlement reforms pushed by the Bowles-Simpson commission. The Alfidi Capital investment thesis of a severe US financial crisis triggering a hyperinflationary policy response remains unchanged.
I can't close this roundup without shaking my head at the US Senate Select Committee on Intelligence report on the CIA's interrogation practices. A lot of this has been in the public domain for years. Collecting it into an accusatory summary after much of what it describes has already been reformed will needlessly embarrass the intelligence professionals charged with implementing further reforms. Social justice warriors who relish the chance to humiliate security professionals have no understanding of international relations. The US intelligence community has a long memory. I am not being sarcastic at all.
The Salesforce Foundation is pushing its Pledge 1% program to startups. I first heard about this philosophy at Dreamforce 2013. It's hard for me to be sarcastic about something so generous, but I'm pretty sure only later stage startups or early-stage VC-funded startups have a chance of fulfilling the pledge. Any startups who can afford such a commitment are welcome to check out the official Pledge 1% site. The startups that make it work will somehow leverage their donations and employee contacts into new revenue streams. It's really a wake-up call for sharp CMOs to tie non-profit relationships into their marketing channels. If some employee's volunteer hours with the local soup kitchen merits a business development follow-up that closes some ERP software sales, then it's bonus time all around.
Uber has earned itself two more black eyes, first for charging surge pricing during the Sydney hostage crisis and then for one of its executives disputing something trivial with a landlord. Their PR head must be fuming. I recently blogged about Silicon Valley's jerk culture but no one with serious money seems to care. Facebook and Microsoft both had significant growing pains as they achieved monopolistic control of their sectors. They got over those episodes by bringing in experienced senior executives who grew up in other corporate cultures. Uber desperately needs an outsider to make a cultural hairpin turn before this taxi hits a guardrail.
The "cromnibus" federal spending bill is through Congress and headed to the President's desk. In case you missed it, the name is a hybrid of an "omnibus" normal appropriations bill and a "continuing resolution" for stopgap funding. It contained a special gift for Wall Street by weakening Dodd-Frank rules. The important lesson for the financial sector is that Washington still isn't serious about restoring fiscal sanity, regulating Wall Street, or enacting the entitlement reforms pushed by the Bowles-Simpson commission. The Alfidi Capital investment thesis of a severe US financial crisis triggering a hyperinflationary policy response remains unchanged.
I can't close this roundup without shaking my head at the US Senate Select Committee on Intelligence report on the CIA's interrogation practices. A lot of this has been in the public domain for years. Collecting it into an accusatory summary after much of what it describes has already been reformed will needlessly embarrass the intelligence professionals charged with implementing further reforms. Social justice warriors who relish the chance to humiliate security professionals have no understanding of international relations. The US intelligence community has a long memory. I am not being sarcastic at all.
Sunday, December 14, 2014
The Limerick of Finance for 12/14/14
Speculators waded into oil
Falling price set their plans up for spoil
Some producers go bust
Wells reverting to dust
OPEC pumping keeps shale in the soil
Falling price set their plans up for spoil
Some producers go bust
Wells reverting to dust
OPEC pumping keeps shale in the soil
Saturday, December 13, 2014
Piercing the Dark Clouds Over San Francisco's Young Professional Culture Groups
I have supported San Francisco's leading arts and cultural institutions for as long as I have resided in The City. The institutions themselves are fine, despite the problems their labor unions cause out of spite for the audience. I used to think the young professional support groups associated with the arts were just as fine. I no longer believe that to be the case. My membership in those support groups no longer makes sense.
That's me, posing at the War Memorial Opera House in a publicity shoot for the San Francisco Ballet's planned giving program. The arts matter to me and I once believed The City's young professionals I met at cocktail receptions felt the same way. Some do, but most do not.
My decade of networking with like-minded people over cocktails bore a lot of fruit. I connected with dozens of intelligent, ambitious people who are mature enough to handle professional responsibility. I also encountered hundreds of forgettable people who were not worth my time. I periodically dropped such people from my circle of contacts. Let's review a recent sample of these losers, complete with pseudonyms . . .
"The Continental" . . . a Silicon Valley engineer who routinely spends more than he makes, and only avoids bankruptcy because his recent employers got acquired and gave generous severances to terminated employees like him . . .
"The Singing Jerk" . . . a very irritating man-child with no verifiable employment history, who inexplicably breaks into Rolling Stones lyrics in the middle of a conversation . . .
"The Fashionistas" . . . some gaggle of aspiring supermodels throwing all of their disposable income away on wardrobe and makeup, living for the chance to be featured in 7x7 Magazine or the Nob Hill Gazette . . .
"The Gold-Digging Barflies" . . . aging single women who would rather prospect for sugar daddies than hold down paying jobs . . .
The barflies have become particularly annoying because some of them became fixated on dating me, literally pushing away other high-quality women I would rather pursue. I reached my breaking point with these idiots when I recently became aware of some totally unacceptable behavior. It is the kind of conduct more typically associated with a certain alternative festival in the Black Rock Desert of Nevada than with a coterie of young professionals. I don't have time to dig around separating factual narratives from spiteful rumors, because the rumors of this behavior are enough to put me off. Where there's smoke, there's usually fire, and I don't need to know whether someone is actually burning. I never witnessed this conduct, nor can I produce evidence that it occurs, but people I trust now corroborate its persistence. The possibility of a pervasive problem is too alarming to ignore. I am now compelled to take decisive action.
I declined to renew my memberships in several of these young professional groups. One remaining membership expires in 2015 and I shall allow it to run out naturally. I have also dropped a large number of people from my contact list, more than I have ever dropped in one sitting. Three figures worth of useless humans are totally gone from my life this December. These people had very little in common with me anyway and I won't miss them. I still attend performing arts events, including galas, where these losers congregate. I will not let them cross my path to blight my life. The San Francisco War Memorial and Performing Arts Center was named for veterans. I go there to represent my absent companions, and for my own well-being.
The effort I make in meeting people just to weed them out is now a burden on my schedule. I have discovered that I am more efficient at meeting worthwhile people at strictly business-oriented events. There's a common saying that a person is the average of their five closest contacts. If I picked five people at random from those cultural clubs, I'd have a handful of arrested development jerks whose adolescent flights of fancy belong with Peter Pan. If I picked five random entrepreneurs or freelancers from my business event calendar, most of them would belong in a boardroom.
Yuppie social groups were useful to me a decade ago when I had few friends in San Francisco. Diminishing returns set in after age 40. These social groups are to real philanthropy what a cargo cult is to a real economy. Going through the motions of success makes little sense if participants can't back up their incantations with competence. I would rather apply my competence elsewhere than go through motions with permanent aspirants.
I have overstayed the time I needed to spend in several young professional groups. I will say goodbye to some people at a few remaining social events and ignore a large number of people who do not deserve my goodbyes. I have been free of debt, addictions, and irresponsibility for my entire life. Most of the people I used to know in the San Francisco yuppie crowd do not share those preferences. It is time for me to go.
That's me, posing at the War Memorial Opera House in a publicity shoot for the San Francisco Ballet's planned giving program. The arts matter to me and I once believed The City's young professionals I met at cocktail receptions felt the same way. Some do, but most do not.
My decade of networking with like-minded people over cocktails bore a lot of fruit. I connected with dozens of intelligent, ambitious people who are mature enough to handle professional responsibility. I also encountered hundreds of forgettable people who were not worth my time. I periodically dropped such people from my circle of contacts. Let's review a recent sample of these losers, complete with pseudonyms . . .
"The Continental" . . . a Silicon Valley engineer who routinely spends more than he makes, and only avoids bankruptcy because his recent employers got acquired and gave generous severances to terminated employees like him . . .
"The Singing Jerk" . . . a very irritating man-child with no verifiable employment history, who inexplicably breaks into Rolling Stones lyrics in the middle of a conversation . . .
"The Fashionistas" . . . some gaggle of aspiring supermodels throwing all of their disposable income away on wardrobe and makeup, living for the chance to be featured in 7x7 Magazine or the Nob Hill Gazette . . .
"The Gold-Digging Barflies" . . . aging single women who would rather prospect for sugar daddies than hold down paying jobs . . .
The barflies have become particularly annoying because some of them became fixated on dating me, literally pushing away other high-quality women I would rather pursue. I reached my breaking point with these idiots when I recently became aware of some totally unacceptable behavior. It is the kind of conduct more typically associated with a certain alternative festival in the Black Rock Desert of Nevada than with a coterie of young professionals. I don't have time to dig around separating factual narratives from spiteful rumors, because the rumors of this behavior are enough to put me off. Where there's smoke, there's usually fire, and I don't need to know whether someone is actually burning. I never witnessed this conduct, nor can I produce evidence that it occurs, but people I trust now corroborate its persistence. The possibility of a pervasive problem is too alarming to ignore. I am now compelled to take decisive action.
I declined to renew my memberships in several of these young professional groups. One remaining membership expires in 2015 and I shall allow it to run out naturally. I have also dropped a large number of people from my contact list, more than I have ever dropped in one sitting. Three figures worth of useless humans are totally gone from my life this December. These people had very little in common with me anyway and I won't miss them. I still attend performing arts events, including galas, where these losers congregate. I will not let them cross my path to blight my life. The San Francisco War Memorial and Performing Arts Center was named for veterans. I go there to represent my absent companions, and for my own well-being.
The effort I make in meeting people just to weed them out is now a burden on my schedule. I have discovered that I am more efficient at meeting worthwhile people at strictly business-oriented events. There's a common saying that a person is the average of their five closest contacts. If I picked five people at random from those cultural clubs, I'd have a handful of arrested development jerks whose adolescent flights of fancy belong with Peter Pan. If I picked five random entrepreneurs or freelancers from my business event calendar, most of them would belong in a boardroom.
Yuppie social groups were useful to me a decade ago when I had few friends in San Francisco. Diminishing returns set in after age 40. These social groups are to real philanthropy what a cargo cult is to a real economy. Going through the motions of success makes little sense if participants can't back up their incantations with competence. I would rather apply my competence elsewhere than go through motions with permanent aspirants.
I have overstayed the time I needed to spend in several young professional groups. I will say goodbye to some people at a few remaining social events and ignore a large number of people who do not deserve my goodbyes. I have been free of debt, addictions, and irresponsibility for my entire life. Most of the people I used to know in the San Francisco yuppie crowd do not share those preferences. It is time for me to go.
Friday, December 12, 2014
Thursday, December 11, 2014
Wednesday, December 10, 2014
Tuesday, December 09, 2014
Alfidi Capital Attends Mobile Monday's 2014 Year in Review
Mobile Monday's year-in-review for 2014 and predictions for 2015 was one of those can't-miss San Francisco events. I trekked over to Adobe HQ on Townsend Street to absorb the night's wisdom. I've been over there often enough to know that any startups seeking street credibility need to attend those events. Bear in mind that the observations below are all my own.
First, allow me to orient my readers to the Adobe gathering place past the front entrance. Anyone who's ever visited Adobe has seen the employees' creative expressions around their public meeting space. Sketches adorn the walls and they're much better than your kids' etchings hanging on the fridge. I guess the Adobe folks are taking classes after hours to add right-brain creativity to their left-brain work. You might even see something like this unique branding interpretation below.
That's a whole bunch of gumballs arranged in a Plexiglas cube resembling the Adobe logo. It's really cute but the gumballs are not available for consumption. I thought about adapting the Alfidi Capital logo in this style but I don't have a physically impressive space where I can display it.
Adobe's meeting space has all of the fun tech gadgets you'd expect, like cameras and projection systems to capture the audience. That's me taking a selfie of my image on the big, fancy projection screen before it rolled up. I have no idea what these other people were doing. I did not come to Mobile Monday for them.
Mario Tapia kicked off the event with his special rendition of a Christmas rhyme, "Twas The Night Before Funding." I hope he puts it on the Mobile Monday website. Every startup dreams that their primary investor will be some kind, grandfatherly type pushover like Santa Claus. That's why it's a fun fairy tale, kids. Reality is a VC who wants to cram down the founders' stake and push for a premature exit.
Let's get to the panel already. I did not write down much of what they said because I was too busy generating my own thoughts, which I shall now share with you out of generosity. The bubble charts from a tech sector investment bank still projected huge mobile revenue growth even though it means cannibalized growth in other online services. Mobile subscriptions and advertising are very sensitive to economic downturns, and consumers will do without either in the next recession. I'm not sure why the panelists think Millennials' preference for smartphones as data carriers means they're less likely to use it as a phone. Other generations use the devices to make voice calls. The world does not revolve around Gen-Y people even though the ones in Silicon Valley think it does. Mobile sector analysts all seem to be Millennials anyway, so their research is becoming self-referential.
Games dominated every bubble chart and quad chart the Mobile Monday panel discussed. Analysts expecting non-game app categories to overtake games are foolish. Mobile users' preference for amusement on demand is now so thoroughly ingrained that only other gamified apps can satisfy the craving. App makers targeting business functions still have not figured out how to incentivize users with playable levels and token rewards, and that's why they won't see growth that displaces games. The obvious way to jump start growth in any other app category is with gamification.
There may be some growth left in sectors that provide on-demand services specific to locations. Yes, Uber and Lyft, I mean you. The mobile sector forgets those companies aren't just mobile apps, but analysts who don't leave their desks much won't understand logistics in the physical world. Virtual services are a different story. Lots of sectors don't have enough workers who are mobile enough to justify a device and app for everyone, so traditional seat count metrics for ERP systems still matter. I can only see mobile "virtual back offices" for SMBs viable only for those businesses with localized services (gardeners, junk haulers, whatever). The mobile sector is too much in love with itself if it thinks every cubicle dweller is destined to go mobile.
I may be one of the few analysts on Earth who understands what drives M&A in mobile. It's not corporate development targets or cultural fit. It's really cheap capital from the Federal Reserve's ZIRP that makes mobile deals look better than than they would without steroid dollars. The next most important deal driver is the collection of billionaire tech egos who use cheap capital to buy threatening startups. Really, that's it. None of the things I learned in my MBA coursework about strategic fit are driving mobile deals. It will take a severe stock market correction and the removal of the Fed's monetary stimulus to bring old-school methods back to dealmaking.
No way are mobile startups going to keep rocketing from zero to exit in two years. Stratospheric acquisition prices, especially those measured by price paid per employee in startups with low headcounts, are an unsustainable phenomenon unique to bubble economics. I'll believe that WhatsApp and others are viable when their acquiring parents' public financial statements show their line item revenue.
The panel's best insight was the difference between acquisition strategies of tech companies run by different generations. Gen-Y billionaires (Mark Zuckerberg at Facebook) buy messaging startups because that's what Gen-Y uses to communicate. Gen-X firms like Microsoft and Yahoo buy email startups, but I wonder how entrenched Gen-X culture is at those companies. Generational difference in corporate management cries out for a Harvard Business Review case study.
I just LOL at VCs endorsing strong encryption. No way will the NSA allow it. I expect any US-based startups pushing encryption to be bought out by the big firms that have already agreed to cooperate with the NSA, just to see their tech absorbed. Non-US startups offering encryption will have a hard time entering the US market, if you know what I mean.
I heard one of the attendees at this event who mentioned Ashley Madison in the same breath as other dating site success stories. That site caters to adulterers but apparently some people in mobile don't mind. I will not link it here. My readers who approve of that site should never read me again. I take personal integrity very seriously and keeping a marriage vow is a reflection of one's character. Mobile enthusiasts who equate breaking marriage vows with business success might as well invite business partners to betray them.
The panel closed out with their predictions for 2015. They were all over the map expecting disruption in real estate, wearables, wealth management, and other sectors suffering from friction. I agree with the trend of emoticons and short-form messages dominating communication in post-literate society. Maybe the next hot mobile startup will have a hieroglyphics UI.
Mobile Monday's 2014 close-out left me satisfied that I know more about mobile use than most VCs and analysts. I expect more of the same from the sector, particularly from the continued growth of games. The mobile sector can expect to see more of me in 2015.
First, allow me to orient my readers to the Adobe gathering place past the front entrance. Anyone who's ever visited Adobe has seen the employees' creative expressions around their public meeting space. Sketches adorn the walls and they're much better than your kids' etchings hanging on the fridge. I guess the Adobe folks are taking classes after hours to add right-brain creativity to their left-brain work. You might even see something like this unique branding interpretation below.
That's a whole bunch of gumballs arranged in a Plexiglas cube resembling the Adobe logo. It's really cute but the gumballs are not available for consumption. I thought about adapting the Alfidi Capital logo in this style but I don't have a physically impressive space where I can display it.
Adobe's meeting space has all of the fun tech gadgets you'd expect, like cameras and projection systems to capture the audience. That's me taking a selfie of my image on the big, fancy projection screen before it rolled up. I have no idea what these other people were doing. I did not come to Mobile Monday for them.
Mario Tapia kicked off the event with his special rendition of a Christmas rhyme, "Twas The Night Before Funding." I hope he puts it on the Mobile Monday website. Every startup dreams that their primary investor will be some kind, grandfatherly type pushover like Santa Claus. That's why it's a fun fairy tale, kids. Reality is a VC who wants to cram down the founders' stake and push for a premature exit.
Let's get to the panel already. I did not write down much of what they said because I was too busy generating my own thoughts, which I shall now share with you out of generosity. The bubble charts from a tech sector investment bank still projected huge mobile revenue growth even though it means cannibalized growth in other online services. Mobile subscriptions and advertising are very sensitive to economic downturns, and consumers will do without either in the next recession. I'm not sure why the panelists think Millennials' preference for smartphones as data carriers means they're less likely to use it as a phone. Other generations use the devices to make voice calls. The world does not revolve around Gen-Y people even though the ones in Silicon Valley think it does. Mobile sector analysts all seem to be Millennials anyway, so their research is becoming self-referential.
Games dominated every bubble chart and quad chart the Mobile Monday panel discussed. Analysts expecting non-game app categories to overtake games are foolish. Mobile users' preference for amusement on demand is now so thoroughly ingrained that only other gamified apps can satisfy the craving. App makers targeting business functions still have not figured out how to incentivize users with playable levels and token rewards, and that's why they won't see growth that displaces games. The obvious way to jump start growth in any other app category is with gamification.
There may be some growth left in sectors that provide on-demand services specific to locations. Yes, Uber and Lyft, I mean you. The mobile sector forgets those companies aren't just mobile apps, but analysts who don't leave their desks much won't understand logistics in the physical world. Virtual services are a different story. Lots of sectors don't have enough workers who are mobile enough to justify a device and app for everyone, so traditional seat count metrics for ERP systems still matter. I can only see mobile "virtual back offices" for SMBs viable only for those businesses with localized services (gardeners, junk haulers, whatever). The mobile sector is too much in love with itself if it thinks every cubicle dweller is destined to go mobile.
I may be one of the few analysts on Earth who understands what drives M&A in mobile. It's not corporate development targets or cultural fit. It's really cheap capital from the Federal Reserve's ZIRP that makes mobile deals look better than than they would without steroid dollars. The next most important deal driver is the collection of billionaire tech egos who use cheap capital to buy threatening startups. Really, that's it. None of the things I learned in my MBA coursework about strategic fit are driving mobile deals. It will take a severe stock market correction and the removal of the Fed's monetary stimulus to bring old-school methods back to dealmaking.
No way are mobile startups going to keep rocketing from zero to exit in two years. Stratospheric acquisition prices, especially those measured by price paid per employee in startups with low headcounts, are an unsustainable phenomenon unique to bubble economics. I'll believe that WhatsApp and others are viable when their acquiring parents' public financial statements show their line item revenue.
The panel's best insight was the difference between acquisition strategies of tech companies run by different generations. Gen-Y billionaires (Mark Zuckerberg at Facebook) buy messaging startups because that's what Gen-Y uses to communicate. Gen-X firms like Microsoft and Yahoo buy email startups, but I wonder how entrenched Gen-X culture is at those companies. Generational difference in corporate management cries out for a Harvard Business Review case study.
I just LOL at VCs endorsing strong encryption. No way will the NSA allow it. I expect any US-based startups pushing encryption to be bought out by the big firms that have already agreed to cooperate with the NSA, just to see their tech absorbed. Non-US startups offering encryption will have a hard time entering the US market, if you know what I mean.
I heard one of the attendees at this event who mentioned Ashley Madison in the same breath as other dating site success stories. That site caters to adulterers but apparently some people in mobile don't mind. I will not link it here. My readers who approve of that site should never read me again. I take personal integrity very seriously and keeping a marriage vow is a reflection of one's character. Mobile enthusiasts who equate breaking marriage vows with business success might as well invite business partners to betray them.
The panel closed out with their predictions for 2015. They were all over the map expecting disruption in real estate, wearables, wealth management, and other sectors suffering from friction. I agree with the trend of emoticons and short-form messages dominating communication in post-literate society. Maybe the next hot mobile startup will have a hieroglyphics UI.
Mobile Monday's 2014 close-out left me satisfied that I know more about mobile use than most VCs and analysts. I expect more of the same from the sector, particularly from the continued growth of games. The mobile sector can expect to see more of me in 2015.
Monday, December 08, 2014
The Haiku of Finance for 12/08/14
Big Pharma pipeline
Long time to research new drug
Billion dollar path
Long time to research new drug
Billion dollar path
Sunday, December 07, 2014
The Limerick of Finance for 12/07/14
Yahoo Finance shows all the stock quotes
News releases must hit the right notes
Traders don't read reports
While covering shorts
They might as well go herd some goats
News releases must hit the right notes
Traders don't read reports
While covering shorts
They might as well go herd some goats
Saturday, December 06, 2014
Friday, December 05, 2014
Thursday, December 04, 2014
The Haiku of Finance for 12/04/14
Rented high rise view
Investors stare out window
Cash blown on optics
Wednesday, December 03, 2014
The Haiku of Finance for 12/03/14
Spending petty cash
Small biz stocking up supply
Pass reorder point
Small biz stocking up supply
Pass reorder point
Tuesday, December 02, 2014
Monday, December 01, 2014
Sunday, November 30, 2014
The Limerick of Finance for 11/30/14
Precious metals just keep getting slammed
Lots of traders have really been rammed
No love lost for gold
Shiny story gets old
Paper contracts left room to get scammed
Lots of traders have really been rammed
No love lost for gold
Shiny story gets old
Paper contracts left room to get scammed
Saturday, November 29, 2014
Friday, November 28, 2014
The Haiku of Finance for 11/28/14
Same boring meeting
Hot babe entering the room
Get her phone number
Hot babe entering the room
Get her phone number
Thursday, November 27, 2014
The Limerick of Finance for 11/27/14
Thanksgiving meal cost on a chart
Turkey is the costliest part
Pricing holiday plan
Compare fresh food to can
Save now for next year's shopping cart
Alfidi Capital Smack Talk for Thanksgiving 2014
Thanksgiving isn't just about turkey. It's about women going shopping and men being lazy, for most Americans. It's really all about Alfidi Capital laying the smack-down on everything that does not comport with extreme genius.
I give thanks for not living in some smelly dirt-hole country like the ones at the bottom of the Transparency International and Heritage Foundation indexes. Those are the filters I use to sort out the resource sector companies I evaluate, much as a master chef uses a strainer to drain the brine away from a pot of pasta.
I suppose I should be thankful for living in San Francisco but sometimes this town does try my patience. The idiots I see at the Commonwealth Club disprove the common assumption that education enhances intellect. The views of the Pacific Ocean, downtown skyscrapers, and the Golden Gate Bridge make up for the periodic nonsense emanating from over-educated humans.
I am not thankful for activists determined to make all levels of our government less responsive to citizens and more of a burden upon the economy. This goes for both the Left and Right. Busybodies can take their health insurance mandates, sunset-exempt regulations, and faith-based initiatives to one of those loser countries at the bottom of the Transparency International and Heritage Foundation indexes. People who enjoy living in unfree nations are welcome to move away from me. I would be thankful for their absence.
The University of Notre Dame and University of San Francisco do not deserve my thanks. I have degrees from each of those schools and those parchments have never helped me in life. Several fellow alumni have gone out of their way to harm me professionally because I have spoken negatively about the schools in public. I couldn't care less. I remain unscathed. Bring it on, haters. I will outlast all of my detractors.
I continue to thank myself for cutting off relations with people who turned out to be losers. Former acquaintances who revealed themselves as idiots were putting me at risk with their drama. I sometimes see them in public and I have reminded myself to keep them at a distance so I'm not infected by their insanity. Yes, fellow members of the financial services community, I mean you in particular. Craziness is contagious in San Francisco and I don't need to catch it.
You should all be thankful that I am the greatest financial analyst you've ever read. Don't waste your lives trying to outperform me because that's impossible. Spend your time wisely, basking in the glow of my eternal wisdom. Women in particular should be thankful that I am so extremely handsome. They usually find me irresistible but they will have to wait until after Thanksgiving. They can send me hot photos of themselves to tide me over until we meet in person. That would make for a very happy Thanksgiving.
I give thanks for not living in some smelly dirt-hole country like the ones at the bottom of the Transparency International and Heritage Foundation indexes. Those are the filters I use to sort out the resource sector companies I evaluate, much as a master chef uses a strainer to drain the brine away from a pot of pasta.
I suppose I should be thankful for living in San Francisco but sometimes this town does try my patience. The idiots I see at the Commonwealth Club disprove the common assumption that education enhances intellect. The views of the Pacific Ocean, downtown skyscrapers, and the Golden Gate Bridge make up for the periodic nonsense emanating from over-educated humans.
I am not thankful for activists determined to make all levels of our government less responsive to citizens and more of a burden upon the economy. This goes for both the Left and Right. Busybodies can take their health insurance mandates, sunset-exempt regulations, and faith-based initiatives to one of those loser countries at the bottom of the Transparency International and Heritage Foundation indexes. People who enjoy living in unfree nations are welcome to move away from me. I would be thankful for their absence.
The University of Notre Dame and University of San Francisco do not deserve my thanks. I have degrees from each of those schools and those parchments have never helped me in life. Several fellow alumni have gone out of their way to harm me professionally because I have spoken negatively about the schools in public. I couldn't care less. I remain unscathed. Bring it on, haters. I will outlast all of my detractors.
I continue to thank myself for cutting off relations with people who turned out to be losers. Former acquaintances who revealed themselves as idiots were putting me at risk with their drama. I sometimes see them in public and I have reminded myself to keep them at a distance so I'm not infected by their insanity. Yes, fellow members of the financial services community, I mean you in particular. Craziness is contagious in San Francisco and I don't need to catch it.
You should all be thankful that I am the greatest financial analyst you've ever read. Don't waste your lives trying to outperform me because that's impossible. Spend your time wisely, basking in the glow of my eternal wisdom. Women in particular should be thankful that I am so extremely handsome. They usually find me irresistible but they will have to wait until after Thanksgiving. They can send me hot photos of themselves to tide me over until we meet in person. That would make for a very happy Thanksgiving.
Wednesday, November 26, 2014
The Haiku of Finance for 11/26/14
App life cycle work
Certify knowledge support
Process meant for growth
Certify knowledge support
Process meant for growth
Data Supply Chain Needs KCS and ITIL
I have blogged before about the data supply chain and I'm pretty sure I'm still way ahead of other analysts covering this emerging topic. Data sector professionals need to talk more about defining the life cycle management of apps and their supporting data products. I'll offer two existing constructs that should help data people move toward a more mature life cycle.
The Consortium for Service Innovation (CSI) publishes the Knowledge-Centered Support (KCS) process. It governs the ongoing revisions and interventions in the life cycle of supporting knowledge for any process. The engineering approach to refining knowledge management easily supports a data sector product. Standards for an iterative programming process make revisions easier when an API needs a version 2.0 update.
The Information Technology Infrastructure Library (ITIL) is an established system for optimizing IT service management. It complements KCS and it should be especially valuable for data sector pros in the documenting and archiving phases of life cycle management. Understanding ITIL makes implementing ISO/IEC 20000 easier. Broad architectures aren't just for large IT departments in big enterprises. Apps will more frequently aim at capturing Big Data, and an ITIL approach in a small app maker keeps it aligned with the needs of larger enterprises who will shop for data packages.
Data sector people who care about managing highly regarded APIs and SDKs should look seriously as the KCS and ITIL architectures. Having a "KCS Verified" business is like having a Good Housekeeping seal of approval. It may not be a product differentiator when app reviewers make their best-of-breed assessments in app stores but taking the process seriously should lead to building better apps. Using ITIL in a data sector business process keeps the life cycle efficient. Both KCS and ITIL together will help entrepreneurs turn their app idea into a real business.
The Consortium for Service Innovation (CSI) publishes the Knowledge-Centered Support (KCS) process. It governs the ongoing revisions and interventions in the life cycle of supporting knowledge for any process. The engineering approach to refining knowledge management easily supports a data sector product. Standards for an iterative programming process make revisions easier when an API needs a version 2.0 update.
The Information Technology Infrastructure Library (ITIL) is an established system for optimizing IT service management. It complements KCS and it should be especially valuable for data sector pros in the documenting and archiving phases of life cycle management. Understanding ITIL makes implementing ISO/IEC 20000 easier. Broad architectures aren't just for large IT departments in big enterprises. Apps will more frequently aim at capturing Big Data, and an ITIL approach in a small app maker keeps it aligned with the needs of larger enterprises who will shop for data packages.
Data sector people who care about managing highly regarded APIs and SDKs should look seriously as the KCS and ITIL architectures. Having a "KCS Verified" business is like having a Good Housekeeping seal of approval. It may not be a product differentiator when app reviewers make their best-of-breed assessments in app stores but taking the process seriously should lead to building better apps. Using ITIL in a data sector business process keeps the life cycle efficient. Both KCS and ITIL together will help entrepreneurs turn their app idea into a real business.
Tuesday, November 25, 2014
3 Crucial Skills for US Military Veterans Seeking Corporate Careers
I served in the US Army after my studies at the University of Notre Dame. Some of my ROTC program classmates stayed on active duty for the long haul, longer than I thought would be sane. They are now approaching their 20-year service milestones, which means some of them are considering life on the outside. I have them in mind when I think about the references I used years ago when I started my own transition to civilian life. The published works available to help military veterans make career transitions could fill a whole library shelf. Most of that material is general and repetitive. Hardly any guidance is tailored for someone with a more technical career goal. Fear not, senior veterans, because Alfidi Capital is here to fill the knowledge gap.
I have identified three skill sets germane to a large corporate environment. These skills are portable to any corporation and are particularly useful in very technical fields. Acquiring them requires mastery of peer-reviewed bodies of knowledge. These qualifications are vastly more credible with corporate recruiters than any military-specific skills a veteran possesses.
Six Sigma certification is the first skill set that veterans should acquire if they want corporate careers. Completing a Six Sigma project within the US Department of Defense confers a resume bullet more valuable than experience with real bullets. The American Society for Quality (ASQ) maintains extensive references on Six Sigma and related topics. The International Association for Six Sigma Certification (IASSC) lists options for completing the qualifying exams. Completing the appropriate training and exams is not cheap but is absolutely necessary for official qualification.
Knowledge management (KM) is the second skill set. Practitioners become the go-to people when an organization translates the DIKW Pyramid into real operations. Experts read KMWorld for the latest developments. The American Productivity and Quality Center (APQC) defines many KM best practices. The KM business discipline does not yet have a universally recognized body of knowledge and several organizations have emerged with competing certification standards. I believe that mastering the APQC material through independent study is sufficient at present to claim expertise.
Operations research (OR) is the final skill set. The Allied Powers in World War II invented the modern field of OR, and today select US Army officers maintain qualification in the operations research / systems analysis (ORSA) specialty. The Institute for Operations Research and the Management Sciences (INFORMS) is the US governing body for the OR profession; they have all the resources needed for someone seeking qualification.
Mastering these skills enables a veteran to compete for corporate jobs that have prerequisites beyond entry-level experience. Combining them with certification as PMI's Project Management Professional would make a veteran's resume very compelling. Lacking these hard skills can be a serious handicap. It is an unfortunate fact of modern life that business skills have diverged far enough from the generalist "soft skills" of military leadership to disqualify many veterans from white collar occupations. Veterans who wish to avoid confinement to the low-income ghetto of permanent entry-level career paths should master widely accepted business knowledge. This means hitting the books all over again.
I recently attended a talk by US Marine Corps combat veteran David Danelo about his book The Return: A Field Manual for Life After Combat. The audience at San Francisco's Marines Memorial Club recognized that veterans' passion for a meaningful life should carry over into a civilian career once they leave the military. Passion hits a brick wall when civilian employers find a veteran's resume devoid of recognizable prerequisites. Veterans who master the three disciplines above prove they have the passion to carry on as relevant civilians.
The Haiku of Finance for 11/25/14
Big health care loophole
Illegal workers get through
Free care from clinics
Illegal workers get through
Free care from clinics
The Health Insurance Liability of San Francisco's Illegal Alien Invaders
I attended the Commonwealth Club's "Undocumented and Uninsured" talk last night. The entire evening was a one-sided advocacy of health care policy solutions favoring illegal aliens. Every one of the experts on stage owed their livelihoods to government handouts. I expected a serious debate about the impact of illegal immigration on the cost of health care. I should have known better; after all, this is San Francisco.
The San Francisco Community Clinic Consortium serves as many illegal aliens as it can handle thanks to subsidies from the federal government. Illegals can also apply to Medi-Cal and Covered California for health insurance, and since they often hold off-the-books jobs their artificially low incomes qualify them for plans that higher earners subsidize with inflated premiums. Well, that's just great, isn't it? Actually, it's not great, but I needed to throw the sarcasm out there. They can also get free treatment through Healthy San Francisco, funded by a surcharge on restaurant meals. It's ironic how lots of these illegals work under the table (pun intended) in restaurants and go without employer-based coverage, yet restaurant surcharges enable them to get free health care.
Employers have very powerful incentives to keep illegals off their books and out of employer-sponsored ACA-compliant health insurance plans. Businesses avoid a $3000 penalty per employee for ACA noncompliance if they hire illegals who are not required to enroll in an ACA plan. In turn, ACA funds handed to community health clinics like SFCCC pay for illegal aliens' health care. This loophole is a dream for pro-lawbreaking DREAMers, because they stick it to law-abiding Americans several times over. Illegals earn unreported income, get free health care, and overload a health care system that cannot anticipate their needs because it can't legally account for their existence. Law-breaking aliens become a financial tapeworm sucking funds from the health care sector while remaining hidden from financial and actuarial discovery.
Leading sources of health care reporting are not helping clarify this bad situation. Reading the California Health Report, the California Healthcare Foundation's Center for Health Reporting, and the Health Dialogues of the California Report results in perpetual obfuscation. Their breathless headlines report endless policy tweaks and suggestions for additional subsidies, with the overarching goal of helping plan participants game the system any way possible. The progressive mindset has thoroughly infected the California health care sector now that ACA has made it an oligopoly for providers and an entitlement for an illegal constituency. The California Endowment's Reporting on Health project might help clear the air if it sticks to data analysis.
San Francisco's reputation as one of the most progressive cities in the state is not doing much to help the illegals who end up in Medi-Cal or Healthy San Francisco. The state's Office of the Patient Advocate has report cards that tell the tale. The Medi-Cal managed care report card for San Francisco says it all, with most of the health care options scoring average or lower compared to the rest of the state. Way to go, San Francisco. Being a "sanctuary city" promising safe haven for illegals facing deportation sure doesn't do them many health care favors.
The one panelist at the Commonwealth Club who self-identified as a DREAMer never expressed any remorse that he had lied to various legal authorities his entire young life to obtain benefits that are reserved for citizens. His sense of entitlement to break the law was breathtaking to behold. I thought about contacting US Immigration and Customs Enforcement but I now realize that would be an exercise in futility. The Immigration Accountability Executive Actions announced last week now prevent ICE from capturing lawbreakers like that DREAMer panelist. He is now free to pursue his medical degree in the place of a law-abiding citizen whose academic enrollment he stole.
I will not maintain the polite fiction that an invading horde of squatters constitutes an aspirational class of future immigrants. Advocates for illegal aliens' health care policies have no clue how the economy works. They do have a very good understanding of how electoral maps work. More illegal invaders crossing an unsecured border mean more votes (not checked with identification cards, of course) for politicians who promise these free handouts. San Francisco's public policy elite continues to plan more giveaways to alien invaders, with no thought to the law-abiding US citizens they impoverish.
The San Francisco Community Clinic Consortium serves as many illegal aliens as it can handle thanks to subsidies from the federal government. Illegals can also apply to Medi-Cal and Covered California for health insurance, and since they often hold off-the-books jobs their artificially low incomes qualify them for plans that higher earners subsidize with inflated premiums. Well, that's just great, isn't it? Actually, it's not great, but I needed to throw the sarcasm out there. They can also get free treatment through Healthy San Francisco, funded by a surcharge on restaurant meals. It's ironic how lots of these illegals work under the table (pun intended) in restaurants and go without employer-based coverage, yet restaurant surcharges enable them to get free health care.
Employers have very powerful incentives to keep illegals off their books and out of employer-sponsored ACA-compliant health insurance plans. Businesses avoid a $3000 penalty per employee for ACA noncompliance if they hire illegals who are not required to enroll in an ACA plan. In turn, ACA funds handed to community health clinics like SFCCC pay for illegal aliens' health care. This loophole is a dream for pro-lawbreaking DREAMers, because they stick it to law-abiding Americans several times over. Illegals earn unreported income, get free health care, and overload a health care system that cannot anticipate their needs because it can't legally account for their existence. Law-breaking aliens become a financial tapeworm sucking funds from the health care sector while remaining hidden from financial and actuarial discovery.
Leading sources of health care reporting are not helping clarify this bad situation. Reading the California Health Report, the California Healthcare Foundation's Center for Health Reporting, and the Health Dialogues of the California Report results in perpetual obfuscation. Their breathless headlines report endless policy tweaks and suggestions for additional subsidies, with the overarching goal of helping plan participants game the system any way possible. The progressive mindset has thoroughly infected the California health care sector now that ACA has made it an oligopoly for providers and an entitlement for an illegal constituency. The California Endowment's Reporting on Health project might help clear the air if it sticks to data analysis.
San Francisco's reputation as one of the most progressive cities in the state is not doing much to help the illegals who end up in Medi-Cal or Healthy San Francisco. The state's Office of the Patient Advocate has report cards that tell the tale. The Medi-Cal managed care report card for San Francisco says it all, with most of the health care options scoring average or lower compared to the rest of the state. Way to go, San Francisco. Being a "sanctuary city" promising safe haven for illegals facing deportation sure doesn't do them many health care favors.
The one panelist at the Commonwealth Club who self-identified as a DREAMer never expressed any remorse that he had lied to various legal authorities his entire young life to obtain benefits that are reserved for citizens. His sense of entitlement to break the law was breathtaking to behold. I thought about contacting US Immigration and Customs Enforcement but I now realize that would be an exercise in futility. The Immigration Accountability Executive Actions announced last week now prevent ICE from capturing lawbreakers like that DREAMer panelist. He is now free to pursue his medical degree in the place of a law-abiding citizen whose academic enrollment he stole.
I will not maintain the polite fiction that an invading horde of squatters constitutes an aspirational class of future immigrants. Advocates for illegal aliens' health care policies have no clue how the economy works. They do have a very good understanding of how electoral maps work. More illegal invaders crossing an unsecured border mean more votes (not checked with identification cards, of course) for politicians who promise these free handouts. San Francisco's public policy elite continues to plan more giveaways to alien invaders, with no thought to the law-abiding US citizens they impoverish.
Monday, November 24, 2014
The Haiku of Finance for 11/24/14
Mobile mapping app
Tracking terrain for drone flight
Three dimension cash
Tracking terrain for drone flight
Three dimension cash
AlwaysOn Hosts OnMobile 2014 in Palo Alto
I am getting addicted to AlwaysOn events, and OnMobile 2014 this month was worth my time. Tony Perkins' new Cuckoos Nest Club in Silicon Valley attracts big shots and naturally my presence completed the scene. KPMG was a prominent sponsor and I was looking for their representatives on site.
Mr. Perkins' description of Millennial buying patterns got me thinking past their preference for sharing over privacy. The Valley's fixation with Big Data isn't over because enterprises are still figuring out how to package it for resale. I await the first startup that captures some network effect of Big Data aggregation. We also have not seen the full maturation of AIs and machine learning that can magically generate video on demand, although a couple of startups in the AlwaysOn pipeline have some promising early solutions. Fit all this stuff into mobile interfaces and watch the gross margins multiply into a bonanza.
It's now a truism that apps count for more in the mobile UX than a mobile-optimized Web interface. I heard that at countless conferences in 2013 and OnMobile drove the point home. Big venture investors still chase early stage mobile companies but the biggest dumb money has barely arrived in the game. I have sovereign wealth funds in mind when I think of dumb money. They have no clue which technologies will win. Startups with poor prospects may think that is good news if they get cash to burn. A lot of corporate and strategic investors who are late to this game stand to lose a lot if they don't track sources like AlwaysOn.
The fireside chat with Magisto was a classic showcase for how a first-mover advantage creates a network effect. Magisto's video-editing AI already has peer credibility, a user base, and prominent investors. A user base is still not the best traction metric in social media, especially with a freemium model like Magisto. Sharing frequency should matter more because each sharing instance generates an ad impression. Geographic segmentation of a user base matters in content creation for many reasons. Not all alphabets read left-to-right like the Roman alphabet, for example. The back-to-front visual narrative structure of Japanese manga is one geo-specific example that will pose a challenge to Western content creators.
I won't repeat specifics from the startup pitches because some of what they shared is undoubtedly proprietary. I will share my totally subjective general impressions. Validation as "best app of the year" in the Google or Apple stores is certainly a worthy milestone. A killer app would integrate AI auto-generated content with embedded data in its video and images, but I have not seen a good example ready for a market. I can see using mobile apps for on-premise payments after service calls, but retail payments are integrating their POS proximity interfaces with links to apps for bank accounts and credit cards. I expect service call support systems to simply adopt credit and debit card apps rather than reinvent the wheel.
I'm seeing more startups in an emerging Silicon Valley archetype. This archetype addresses only upper income market segments in developed countries who face lifestyle inconveniences. They chase a lucrative but crowded segment whose disposable income enables price inelastic consumption for the time being. The end of central bank intervention in asset markets will destroy that inelasticity. More startups should at least try to address lower income segments and developing markets. The world needs more than another lifestyle management app.
The investor roundtable for B2B mobile predicted apps that could handle internal workflows, so the next hype cycle for enterprise workflows hasn't started until Gartner publishes something on workflow migration to mobile. Real-time data flows will add value in fraud detection and micro-ad targeting but I doubt Gartner will get that specific. Mobile ad attribution is complex and B2B trends are not making it any easier. The roundtable people noted surges in mobile backend services and data rationalization for middleware. Those two trends are IT-specific and I haven't yet seen how either one will help marketers understand ad attribution. A rise in demand for APIs in those stacks should tell us whether marketers are using them to parse ad data.
Another fireside chat with Auction.com showed how mobile is finally disrupting a real sector in the economy rather than layering another form of interaction on top of existing commerce portals. Real estate sites are rapidly disintermediating traditional gatekeepers like banks and real estate agents. Widely available online content de-risks deals by making due diligence easier. I still think the potential for mobile to democratize access to real estate ownership is overestimated simply because REITs already exist and the economic barriers to owning them are very low.
Enabling tech for B2B platforms warranted a separate panel. Transaction sites obviously monetize from fees, but they can also display ads and sell their Big Data. The startups that haven't figured that out are not getting the most out of their enabling tech. I repressed a LOL when the panel said cryptocurrency enables a distributed trust environment for e-commerce. The logic that a blockchain somehow enables a roving identity for shipping addresses is simplistic. Clueless people underestimate the ability of determined cybercriminals to spoof or hijack a blockchain. I'd rather go with layered standards as an industry-wide architecture for competing B2B tech solutions. Personal identity is one layer and shipping address is a separate layer. Different payment mechanisms (debit, credit, Apple Pay) get separate layers. That's my end-run around blockchain weaknesses.
I'll wrap up my analysis by suggesting a way ahead for mobile startups seeking attention at AlwaysOn and other Silicon Valley forums. Startups appearing at pitchfests like OnMobile can build credibility by earning cloud computing awards. There are too many to name here. Ambitious startups should hit the Google search button and find ones they can earn. They can do the same search for cloud sector metrics that bolster their business cases. Cloud providers touching health care must be HIPAA compliant and mobile startups pitching workflows to the health care sector must also meet that standard. If a blockchain approach is to have any place in a business model, it may be useful as a basis for identity management only if it is built once for reference and not expanded every time the identity holder makes a transaction. Minimal coding means more rapid deployment, especially as iterative models replace SDLC waterfall models. Entrepreneurs who talk more about their product than their business model will not connect with investors. The path to monetization via a pricing model must be clear, and it must have an exit strategy. Expected revenue growth models are becoming standardized thanks to Y Combinator and other accelerators, so startups can present more realistic estimates. Anyone launching location-based services should first check with Gigaom Research to see who has done it before.
I need to close with one big observation, and it segues from the 2D photo of the Olga Show host above. Map APIs should enable 3D views. The coming drone revolution means plotting air routes over short flights must account for altitude, terrain elevation, artificial obstructions, and other hazards to aviation. Rotary-wing drones at higher altitudes won't generate as much lift in thinner air, so real-time information on air currents and other weather factors will be essential in next-gen 3D mapping. The mobile startup that masters 3D mapping will own a big chunk of next-gen commerce. You heard it hear first at Alfidi Capital. I get my inspiration from AlwaysOn.
Sunday, November 23, 2014
Saturday, November 22, 2014
Friday, November 21, 2014
The Haiku of Finance for 11/21/14
Next cleantech pivot
Bring Big Data into mix
Venture cash will flow
Bring Big Data into mix
Venture cash will flow
Startups Shine at Cleantech Open 2014 Global Forum
The Cleantech Open held its 2014 Global Forum on San Francisco's Treasure Island and I had a first-hand view of the action. My direct involvement this year culminated with the previous day's final pitches and investor connect speed rounds at a Financial District hotel. I stayed for the Global Forum because thought leaders invariably have insights that make my day.
I won't disclose anything proprietary from the pitches and speed connections on day one, but I do have some random thoughts to share. My general impressions of this year's startups were very positive. Most of the startups I directly observed presented business models that were mature enough to deserve investor due diligence prior to funding. That is a high bar to pass and it speaks well of the program's volunteers who helped the startups refine their plans throughout the year. The most thoughtful startups recognized how their business models leveraged something beyond their core technology, like marketable Big Data or the potential for extended servicing.
Here is the singular cautionary tale. One participant I encountered seriously expected the financial model of any business focusing on a developing country to need a liquidity buffer, but not for the usual unforeseen problems. He envisioned the buffer to accommodate payments under the table, as if he expected Foreign Corrupt Practices Act (FCPA) violations. The people around him chuckled but I do not consider that to be a laughing matter. One startup had a savvy strategy to leverage a local culture's shaming traditions if a corrupt official stood in their way. I would suggest a mitigating strategy of anti-bribery clauses in legal agreements for franchises and joint ventures. This means pulling the franchise agreement of any local partner caught bribing an official, and reporting the incident to both the US and local governments. I have a low opinion of American business people who suggest that FCPA noncompliance is excusable.
The CTO's corporate partners pitched their support services prior to the speed dating round on the first day. Wells Fargo is stepping up with its Innovation Incubator. I also discovered the Wells Fargo Startup Accelerator for financial technology ideas. I'm glad I bank with the Wells Fargo stagecoach. I missed the NREL Industry Growth Forum this year but it will go on my calendar in the future. These sponsors are careful to structure their services and partnerships in light of recent IRS rulings on open source innovation, Corporate sponsored non-profit incubators must share their results with the public to preserve the sponsor's preferential tax treatment, in a nutshell.
The Global Forum introduced Stanford's Energy Transformation Collaborative. The courses look challenging but the research grants available are more immediately relevant to startups. One speaker mentioned how policies should address different technology readiness levels (TRLs), with research for earlier stages and market incentives at later stages. I grok the appreciation for innovative business models that made it big, like Tesla Motors and SolarCity, but they still have not proven any consistent profitability. The cleantech sector can gain credibility with less blind worship of innovation and more respect for a Warren Buffett-style durable competitive advantage.
Former Baywatch actress Alexandra Paul spoke to the CTO crowd about her environmental activism. She looks rail thin in person, as you can see from the photo I took just above. I was thinking someone needs to get her a cheeseburger ASAP before a strong wind blows her away but she's a committed vegan. She wore this black pantsuit that was practically transparent, showing off her toned figure. Her body of film work is as memorable as her physical body, especially in many scenes where she's in her birthday suit. I would have preferred to see her take that transparent suit off at the Cleantech Open but we had to keep things clean (pun intended). Her talk was full of data-free emotional connections to environmentalism that offer classic insights into how laypeople approach cleantech. I'll bet a bunch of publicity-hungry media types in Hollywood and Beverly Hills would be pushovers as early adopters for any high-priced cleantech product they could show off to their peers.
Venture investor Steve Westly gave a version of the talk I heard him give at SVIEF months ago where he touted his portfolio investments. It's perfectly okay to pump your successes and I do it all the time on my blog. Steve wants next-generation cleantech innovations that offer higher gross margins at lower capital requirements to launch. I totally agree with his expectation that stress on the Himalayan watershed will drive conflict in Central Asia, but IMHO cleantech innovation isn't going to prevent that conflict.
The investor panel was stacked with experts from Cisco, Band of Angels, Sidley Austin, and Roda Group, and Wells Fargo. If I had been on the panel, I would have opined that private investors won't fund basic research without a clear path to commercialization. Well, I wasn't on that panel, so I'm saying it here. Federal and university labs should do that basic research. I also suspect that venture funding trends are driven by media headlines and peer pressure, not market fundamentals or deep insights. I am starting to see this in cleantech, as the VC and IT obsession with Big Data will soon spill over into other sectors. Big Data's unfulfilled promise lies in capturing events at the edge of the network where Internet of Things devices will reside. I believe cleantech solutions for energy efficiency, demand management, and microgrid optimization are in the best positions to apply Big Data. Cleantech startups will adjust those pitches, pivot to Big Data, and chase the VC money that drops out of the mobile / social sector.
My second year as a Cleantech Open mentor is over and I have a big list of promising startups to watch. I shall return next year to whip another batch of entrepreneurs into shape. Alexandra Paul was certainly in good shape, and perhaps she will return to give us another look at her body (of cleantech work).
I won't disclose anything proprietary from the pitches and speed connections on day one, but I do have some random thoughts to share. My general impressions of this year's startups were very positive. Most of the startups I directly observed presented business models that were mature enough to deserve investor due diligence prior to funding. That is a high bar to pass and it speaks well of the program's volunteers who helped the startups refine their plans throughout the year. The most thoughtful startups recognized how their business models leveraged something beyond their core technology, like marketable Big Data or the potential for extended servicing.
Here is the singular cautionary tale. One participant I encountered seriously expected the financial model of any business focusing on a developing country to need a liquidity buffer, but not for the usual unforeseen problems. He envisioned the buffer to accommodate payments under the table, as if he expected Foreign Corrupt Practices Act (FCPA) violations. The people around him chuckled but I do not consider that to be a laughing matter. One startup had a savvy strategy to leverage a local culture's shaming traditions if a corrupt official stood in their way. I would suggest a mitigating strategy of anti-bribery clauses in legal agreements for franchises and joint ventures. This means pulling the franchise agreement of any local partner caught bribing an official, and reporting the incident to both the US and local governments. I have a low opinion of American business people who suggest that FCPA noncompliance is excusable.
The CTO's corporate partners pitched their support services prior to the speed dating round on the first day. Wells Fargo is stepping up with its Innovation Incubator. I also discovered the Wells Fargo Startup Accelerator for financial technology ideas. I'm glad I bank with the Wells Fargo stagecoach. I missed the NREL Industry Growth Forum this year but it will go on my calendar in the future. These sponsors are careful to structure their services and partnerships in light of recent IRS rulings on open source innovation, Corporate sponsored non-profit incubators must share their results with the public to preserve the sponsor's preferential tax treatment, in a nutshell.
The Global Forum introduced Stanford's Energy Transformation Collaborative. The courses look challenging but the research grants available are more immediately relevant to startups. One speaker mentioned how policies should address different technology readiness levels (TRLs), with research for earlier stages and market incentives at later stages. I grok the appreciation for innovative business models that made it big, like Tesla Motors and SolarCity, but they still have not proven any consistent profitability. The cleantech sector can gain credibility with less blind worship of innovation and more respect for a Warren Buffett-style durable competitive advantage.
Former Baywatch actress Alexandra Paul spoke to the CTO crowd about her environmental activism. She looks rail thin in person, as you can see from the photo I took just above. I was thinking someone needs to get her a cheeseburger ASAP before a strong wind blows her away but she's a committed vegan. She wore this black pantsuit that was practically transparent, showing off her toned figure. Her body of film work is as memorable as her physical body, especially in many scenes where she's in her birthday suit. I would have preferred to see her take that transparent suit off at the Cleantech Open but we had to keep things clean (pun intended). Her talk was full of data-free emotional connections to environmentalism that offer classic insights into how laypeople approach cleantech. I'll bet a bunch of publicity-hungry media types in Hollywood and Beverly Hills would be pushovers as early adopters for any high-priced cleantech product they could show off to their peers.
Venture investor Steve Westly gave a version of the talk I heard him give at SVIEF months ago where he touted his portfolio investments. It's perfectly okay to pump your successes and I do it all the time on my blog. Steve wants next-generation cleantech innovations that offer higher gross margins at lower capital requirements to launch. I totally agree with his expectation that stress on the Himalayan watershed will drive conflict in Central Asia, but IMHO cleantech innovation isn't going to prevent that conflict.
The investor panel was stacked with experts from Cisco, Band of Angels, Sidley Austin, and Roda Group, and Wells Fargo. If I had been on the panel, I would have opined that private investors won't fund basic research without a clear path to commercialization. Well, I wasn't on that panel, so I'm saying it here. Federal and university labs should do that basic research. I also suspect that venture funding trends are driven by media headlines and peer pressure, not market fundamentals or deep insights. I am starting to see this in cleantech, as the VC and IT obsession with Big Data will soon spill over into other sectors. Big Data's unfulfilled promise lies in capturing events at the edge of the network where Internet of Things devices will reside. I believe cleantech solutions for energy efficiency, demand management, and microgrid optimization are in the best positions to apply Big Data. Cleantech startups will adjust those pitches, pivot to Big Data, and chase the VC money that drops out of the mobile / social sector.
My second year as a Cleantech Open mentor is over and I have a big list of promising startups to watch. I shall return next year to whip another batch of entrepreneurs into shape. Alexandra Paul was certainly in good shape, and perhaps she will return to give us another look at her body (of cleantech work).
Thursday, November 20, 2014
Pachamama Alliance is Clueless About Sustainable Development
I attended the Pachamama Alliance annual luncheon today in San Francisco at a friend's invitation. The Fort Mason Festival Pavilion was filled with well-dressed do-gooders determined to feel great about keeping poor people in poverty. I am about to prove that they think too much of themselves.
Several things about this organization make me wonder what its donors are thinking, or if they can think at all. Pachamama's financial statement for 2013 shows that it spends 12% of its budget on fundraising and 7% on general administration. That 19% is a high figure just for overhead. Charity Navigator gives them a high rating for accountability with a moderately high financial score, which surprises me given that large overhead. Pachamama does not participate in Guidestar's non-profit rating scheme, which makes its effectiveness more difficult to ascertain.
Indigenous Amazonians were on parade at this luncheon, playing pan flutes and dispensing blessings in an incomprehensible language. The organizers played several videos about the alliance's work. These were slickly produced mashups devoid of narrative structure or accountable details. No one in the audience seemed to mind. They were too enthralled with the "human petting zoo" of the visiting indigenous people to realize they were being manipulated. This organization proudly introduced some kind of online training course designed to do . . . something or other, like raise even more awareness than they've already raised. All of this raising awareness is of course designed to raise money.
Even a teenager got into the act, bragging to the audience about her monthly donations to Pachamama (apparently from her parents' money, since she mentioned no income stream of her own). I marvel at the indulgence of affluent Bay Area parents, encouraging their children to be irresponsible with a generous sponsor's money.
I ignored the maudlin spectacle and tried very hard not to applaud the banal statements from non-thinkers on the podium. I gave in to brief applause a couple of times because bad habits are hard to break. I am results-oriented and I needed to see Pachamama's results. Those results are mind-numbingly bad. Pachamama has lobbied the Ecuadorian government to stop an oil company from exploring in two blocks of the rainforest. Never mind that this development would bring millions of dollars to the region and lift indigenous Amazonians out of poverty.
The founders bragged that they they were developing eco-tourist programs as an alternative to petroleum production. It's easy to do the math with their program details. One dingbat volunteer claimed that they charge about $4500 for one eco-tourist ticket, taking ten people per trip, with about ten trips scheduled per year. That's about $450K in gross revenue per year, compared to the millions the local tribes could earn if those oil blocks are open to foreign direct investment. Pachamama's intransigence keeps their erstwhile clients impoverished.
Pachamama's promoters claimed with pride that they built an airstrip to facilitate these eco-tours, supposedly mitigating the deforestation that paving a road through the Amazon rainforest would have required. They failed to calculate that moving human passengers by air uses far more petroleum and produces far more air pollution than moving them by bus on a road. This nearsightedness is lost on social justice warriors. I must have been the only attendee to grok the irony of eco-tourism that accelerates the local consumption of petroleum.
Ecuador already subscribes to the United Nations Reducing Emissions from Deforestation and forest Degradation (REDD) program for developing countries. It does not need a bunch of Bay Area do-gooders complicating its search for sustainable development in the Amazon rainforest. The Ecuadorian government shut down Pachamama's operations in its country last December precisely because it was so disruptive. The bleeding hearts in the Festival Pavilion were getting teary-eyed at their inability to keep low-income people locked into prehistoric lifestyles.
Multinational energy companies know they are under scrutiny for their environmental practices, which is why they spend lots of money to get the projects right. The obvious solution to sustainable development in the Amazon basin is to allow energy supermajors the ability to manage their onshore production blocks like timber REITs, giving shareholders a stake in the forest's sustainability. Anti-development nuts won't like it because they could no longer gawk at poor Amazonians during eco-tours.
I will not attend any more of these stupid events, despite the enticement of free food and hot babes. The free lunch of greens and sweet potato cakes was a vegan's dream. I barely noticed it going down and I spent the rest of the afternoon longing for glorious meat protein. The dessert tables afterwards were full of cookies and brownies that were definitely not from a rainforest. Those natives don't know what they're missing by spurning development for boutique eco-tourism. The young babes in attendance caught my eye because I can't ignore tight skirts and shapely legs. My objection is that those hot body parts were tied to non-functioning minds. One gal held up two potted plants in front of her well-rounded mammaries and asked me, "Aren't these beautiful?" She meant the plants, but I focused on her more important natural goods.
I consider Pachamama Alliance to be an exemplar of the Bay Area's lamest natural impulse. Dimwitted busybodies with more money than they deserve elevate feeling over thinking. The other pressure groups present at the luncheon shared the same cognitive flaw. Citizens Climate Lobby demands a halt to the economic development and energy use that makes their outreach possible. The "anti-corporate personhood" movement failed to recognize that a wealthy elite has directed America's institutions since the Founders put pen to parchment. The attendees themselves arrived at this event mostly in private automobiles burning hydrocarbons! I did more to conserve energy use than any of them when I took the SF Muni bus to Fort Mason. I have once again demonstrated my intellecutal and moral superiority over the Bay Area's non-thinking elite. The world needs more Alfidi Capital and less Pachamama Alliance.
Several things about this organization make me wonder what its donors are thinking, or if they can think at all. Pachamama's financial statement for 2013 shows that it spends 12% of its budget on fundraising and 7% on general administration. That 19% is a high figure just for overhead. Charity Navigator gives them a high rating for accountability with a moderately high financial score, which surprises me given that large overhead. Pachamama does not participate in Guidestar's non-profit rating scheme, which makes its effectiveness more difficult to ascertain.
Indigenous Amazonians were on parade at this luncheon, playing pan flutes and dispensing blessings in an incomprehensible language. The organizers played several videos about the alliance's work. These were slickly produced mashups devoid of narrative structure or accountable details. No one in the audience seemed to mind. They were too enthralled with the "human petting zoo" of the visiting indigenous people to realize they were being manipulated. This organization proudly introduced some kind of online training course designed to do . . . something or other, like raise even more awareness than they've already raised. All of this raising awareness is of course designed to raise money.
Even a teenager got into the act, bragging to the audience about her monthly donations to Pachamama (apparently from her parents' money, since she mentioned no income stream of her own). I marvel at the indulgence of affluent Bay Area parents, encouraging their children to be irresponsible with a generous sponsor's money.
I ignored the maudlin spectacle and tried very hard not to applaud the banal statements from non-thinkers on the podium. I gave in to brief applause a couple of times because bad habits are hard to break. I am results-oriented and I needed to see Pachamama's results. Those results are mind-numbingly bad. Pachamama has lobbied the Ecuadorian government to stop an oil company from exploring in two blocks of the rainforest. Never mind that this development would bring millions of dollars to the region and lift indigenous Amazonians out of poverty.
The founders bragged that they they were developing eco-tourist programs as an alternative to petroleum production. It's easy to do the math with their program details. One dingbat volunteer claimed that they charge about $4500 for one eco-tourist ticket, taking ten people per trip, with about ten trips scheduled per year. That's about $450K in gross revenue per year, compared to the millions the local tribes could earn if those oil blocks are open to foreign direct investment. Pachamama's intransigence keeps their erstwhile clients impoverished.
Pachamama's promoters claimed with pride that they built an airstrip to facilitate these eco-tours, supposedly mitigating the deforestation that paving a road through the Amazon rainforest would have required. They failed to calculate that moving human passengers by air uses far more petroleum and produces far more air pollution than moving them by bus on a road. This nearsightedness is lost on social justice warriors. I must have been the only attendee to grok the irony of eco-tourism that accelerates the local consumption of petroleum.
Ecuador already subscribes to the United Nations Reducing Emissions from Deforestation and forest Degradation (REDD) program for developing countries. It does not need a bunch of Bay Area do-gooders complicating its search for sustainable development in the Amazon rainforest. The Ecuadorian government shut down Pachamama's operations in its country last December precisely because it was so disruptive. The bleeding hearts in the Festival Pavilion were getting teary-eyed at their inability to keep low-income people locked into prehistoric lifestyles.
Multinational energy companies know they are under scrutiny for their environmental practices, which is why they spend lots of money to get the projects right. The obvious solution to sustainable development in the Amazon basin is to allow energy supermajors the ability to manage their onshore production blocks like timber REITs, giving shareholders a stake in the forest's sustainability. Anti-development nuts won't like it because they could no longer gawk at poor Amazonians during eco-tours.
I will not attend any more of these stupid events, despite the enticement of free food and hot babes. The free lunch of greens and sweet potato cakes was a vegan's dream. I barely noticed it going down and I spent the rest of the afternoon longing for glorious meat protein. The dessert tables afterwards were full of cookies and brownies that were definitely not from a rainforest. Those natives don't know what they're missing by spurning development for boutique eco-tourism. The young babes in attendance caught my eye because I can't ignore tight skirts and shapely legs. My objection is that those hot body parts were tied to non-functioning minds. One gal held up two potted plants in front of her well-rounded mammaries and asked me, "Aren't these beautiful?" She meant the plants, but I focused on her more important natural goods.
I consider Pachamama Alliance to be an exemplar of the Bay Area's lamest natural impulse. Dimwitted busybodies with more money than they deserve elevate feeling over thinking. The other pressure groups present at the luncheon shared the same cognitive flaw. Citizens Climate Lobby demands a halt to the economic development and energy use that makes their outreach possible. The "anti-corporate personhood" movement failed to recognize that a wealthy elite has directed America's institutions since the Founders put pen to parchment. The attendees themselves arrived at this event mostly in private automobiles burning hydrocarbons! I did more to conserve energy use than any of them when I took the SF Muni bus to Fort Mason. I have once again demonstrated my intellecutal and moral superiority over the Bay Area's non-thinking elite. The world needs more Alfidi Capital and less Pachamama Alliance.