On the latest episode of the Futurum Tech Podcast, we cover the state of the wearables market in the US and beyond, Apple’s Bluetooth security flaw, alarming stats about data breaches, and interesting stats about B2B security software. All that and more, on this edition of Futurum Tech Podcast.
Our Main Dive
We dive into wearables and their past, present and what we can expect in the future. We also discuss fails vs successes and what we think will work in the next 2-3 years.
Our Fast Five
We dig into this week’s interesting and noteworthy news:
- Data breaches on a daily basis
- Do not install your Microsoft Surface’s August firmware updates–for now
- Good news for Chromebook users
- Enterprise security software tops B2B sales
- Bluetooth security issues
Tech Bites
Facebook doesn’t listen to your Messenger messages; it just hires contractors to do that. Not cool, Facebook!
Crystal Ball: Future-um Predictions and Guesses
WeWork. What the world is going on with this crazy company?
Transcript:
Daniel Newman: Welcome to this week’s edition of the Futurum Tech Podcast, FTP. I’m Daniel Newman, your host for today, joined by my esteemed cohosts, Shelly Kramer and Olivier Blanchard. Shelly, you’ve become a regular on the show. Welcome back.
Shelly Kramer: I am. Thank you. It’s great to be here.
Daniel Newman: As a partner, it’s nice to have you here. We took you out of hiding, but it’s actually really a joy to have your voice on the air and always have your opinions. Olivier, welcome back. I won’t give you a chance to respond.
We got a really great show this week. We’re going to start off talking about some updates in wearables based upon some new Canalys numbers that have come out, some new research on the sweet spot for wearables, and given the fact that Apple has sort of exploded as a wearables company while they have slightly tapered off in other areas, it’s an appropriate topic and it fits the theme of our regular show here on the Futurum Tech Podcast.
Having said that, before we jump into the main dive of our show, I do need to let everybody know that this show is for entertainment and informational purposes only and while we will discuss many publicly traded companies throughout this show, we may even talk about the stocks themselves, we are not providing any investment advice, so please do not buy stocks because of anything you hear us say here, but please tune in and enjoy the show.
Now, diving in. Canalys, and by the way if you’re not familiar with Canalys, this is a company, it’s a research company, a lot like Futurum, but their specialty really is channels and they focus a lot of their research on market sizing. Over the past few weeks, I’ve written a few pieces about some of their research on mobile devices. They put out, just a few weeks ago, their global market sizing for device consumption on large format premium and regular smartphone devices as well as most recently putting the same report out regionally for Europe. Well this week, one of the features, and we’ve had an article that came out of VentureBeat, was looking at Canalys’ research around wearables and basically smartwatches and other wearables.
And there was a really interesting headline that came out on VentureBeat that said, “Wearables have a $200 to $399 sweet spot and it’s led by Apple.” Olivier, you’re a cyclist and I know we’ve been at these Qualcomm events when they were rolling out some of their wearable technology and you light up. Like as tech analysts, every one of us has something we light up about. You light up when it comes to kind of these advanced wearables, especially around athletics, and you had a chance to take a look at these numbers. What was your impression? What’s your thoughts about the wearable space and where things are going right now?
Olivier Blanchard: Well, the wearable space is super exciting for a number of reasons. It’s because they can serve so many different communities, different types of users, and even for each user it can serve different types of purposes.
So as you mentioned, I’m a cyclist and kind of reformed triathlete and we like our gear. Cyclists, 20 years ago, used to call us tri-geeks because triathletes were even more into data and into technology than cyclists were at the time. It’s nothing for a serious cyclist or triathlete or even endurance runner to spend $300 to $700 on a bike computer or some kind of very advanced GPS heart rate monitor wearable. And typically the two big companies that have sort of led the way in that market have been Garmin, which is the same company that makes GPS’s for cars, and to a lesser extent Suunto, which also does a lot of stuff for hikers.
So for someone like me, the price point, that really high price point that’s above 399, is not atypical and it’s kind of been there for many, many years. But for everybody else, the kind of consumerization of these types of wearable technologies and the progress that Apple has made with the Apple Watch in kind of bringing that to the masses and making it more acceptable and making it very user friendly, has been a huge win. And what’s interesting is that Apple, which typically kind of sits at the top of the price point range, usually they’re what, 20, 25% higher than their competitors for a similar product or comparable product I should say, hasn’t really pushed the envelope that much. They’ve been a little bit conservative on some of their price points.
And the reason why is because there does seem to be a sweet spot, actually two sweet spots. There’s a sweet spot between 199 and 299 and that’s $199, not $1.99, so that that kind of $200 to $300 price range, which is actually the sweetest spot according to Canalys, that’s 32% of the market is that. And then there’s a tier above that, that’s a little bit more premium, that’s less standard, that’s more along the lines of $300 to $400. And then you get into the triathlon and cyclist stuff, which is higher than that. And that makes it accessible for kids who want to buy a Smartwatch for their parents just for health reasons, for health monitoring, for EKG applications, things like that. It helps parents buy them for their kids so that they can have a phone watch. I see people talking on the phone on their watches now, which is kind of equally obnoxious and amazing.
And it kind of creates this entry point into the next generation of Apple Watches and other wearables from Android and other OEMs that I think will really expand our capabilities in terms of what we can do with them from becoming keys to walk into our house and start our car, they become our IDs, they’re going to become our payment systems like our credit cards. A lot of the stuff that we do and that we kind of take for granted and use all these other devices for, are increasingly being brought into those wearables. And Apple is, to my chagrin to some extent, kind of leading the way with that. And I really wish that Android would kind of start leading the way a little bit. The way that Android has taken over in the mobile space and kind of gotten about two years ahead of Apple, that has not happened in the wearable space.
Daniel Newman: And of course you would be met with plenty of debate about the two year claim, but I think when you’re talking about technological features on the mobile devices, most technical thinkers, analysts, would actually agree on the technical side. In terms of user experience and stuff, it isn’t that different. Now, I’ve seen a lot of new wearables. I saw a ring this week that has a projector in it that you can actually Bluetooth it to a device to project an image. I mean there’s some really interesting things going on, but you mentioned something about Apple. Now Shelly, I read a headline the other day. It was slightly sensational but interesting.
Shelly Kramer: Did I write it?
Daniel Newman: No. Well maybe, but if you did, you didn’t get credit. Now Apple’s wearable revenue have now exceeded the revenues of Netflix. So Apple sells more, essentially, AirPods and Apple Watches than Netflix does business. So that’s pretty impressive. Apple is on a hot streak right now. They have essentially those two devices, you can call them devices or wearables, that have grown extraordinarily popular and I believe you’re a user of both of those devices. Do you think they’ve hit the sweet spot? Do you think Apple has the potential to stay dominant to Olivier’s point? Do you see Android or others coming on too? Garmin? Do these companies make a comeback or has Apple gotten too far ahead off to the races?
Shelly Kramer: Well, you know, a couple of things. First of all, shout out to Garmin, Kansas City-based company, but what I do when I look at these things and when I think about trends is I look at my kids and I started to ask you this Daniel before we started this show and I just didn’t get a chance to, but I look at the kids. My kids are 13 and a half, their friends have … Now, neither of my children are interested in an Apple Watch, they tend to have their phones in their hand all the time, but when I look at their friends, when I walk in an airport, they’re ubiquitous. Everyone has an Apple Watch on. And the other thing that’s ubiquitous is AirPods.
And what I’m seeing from teenagers is, their go-to gift, “What are you going to buy me, mom and dad,” is, “I need a pair of AirPods and I need an Apple Watch, and oh by the way, when I lose an AirPod,” which we all do, you know, that’s really important because you come … You know, they are consuming media on their devices. They love using AirPods. They don’t like being connected. There are other solutions out there. There are other brands out there. But I look at what’s going on with Apple right now, a little bit like Fitbit, and there was a day when if you were going to wear a wearable and you weren’t Olivier, in the high end sports thing, you were wearing a Fitbit and you were tracking your steps and that was all that really mattered and trying to stay healthy and everything else.
And then Apple Watches came out and I think as the price point has gotten lower and, you know, all of us have kids and all of us are raising children who probably have it all. I mean, I don’t know about you, but when I think … You know, Daniel, I know your kids are about the same age as mine, but just trying to think of something to get them for a gift is difficult because they kind of have everything they need. And so when you’re talking about a $200 or $300 price point, that’s not hard to deliver for a Christmas gift, holiday gift, birthday gift, whatever.
Olivier, you mentioned buying them for your parents. I think that’s a trickier thing because my parents either wear watches or they don’t wear watches, but if they wear watches, they’re wearing their gold watch that somebody gave them that’s meaningful, and the thought of replacing that with a piece of technology that you have to take off and charge, that’s sometimes a little overwhelming. I can see conceptually that would be a good idea, but bottom line, I think that we’re going to continue to see Apple dominate here. And I think that there’s not a big difference between spending, $200-300 or $300-400 if you want.
I was just on vacation with some friends and all three of them had the Apple Watch, the latest version that’s waterproof, and I have no desire. I don’t need to. I’m happy to take my watch off when I’m at the beach. I don’t want to wear it. But they kept them on all the time and they’re just such an important appliance, it’s such an important part of their lives, it never occurred to them to take them off.
Daniel Newman: Yeah, I think what you’re seeing is very accurate among the teenage community, specifically in the United States. I think it’s important that we consider the global implications. As I started this off talking about Canalys’ numbers, Samsung has now achieved 40% of the smartphone device market in Europe. They are the most dominant smartphone device market shareholder in the world. And obviously wearables are accessories that tend to connect to your core device. Meaning most people that are wearing EarPods, I believe you can connect them to another device but they don’t work nearly as well. I actually have never tested that, but I believe that is the case.
Someone can let me know if I’m wrong. Same as like I have the Galaxy Buds, but I only use them with my S10 Plus, I never connected them to my iPhone. I might try that now just to see if it’s even possible.
But they’re so well designed to work together, just like the Apple Watch. The second you turn it on, you put your phone in range, turn on Bluetooth and it’s connecting it up. So the ecosystem does become very important. US-based iPhones are peak popular. They are extraordinarily popular among affluent teenagers, which means they’re going to want the accessories. Like I said, I tried to give my kid a $400 Bluetooth pair of headphones that was not AirPods and she cried and she was afraid to wear them in front of her peers, so Apple definitely has that here.
Now outside of the US, if 40% of Europe is using smartphones that are not Apple, I believe that’s where Android has a real opportunity, Android-based solutions, because people are going to want to have similar types of devices to pair with their smartphones that will not be as friendly for AirPods or Apple Watches. So they’re going to need alternatives. And I do think to your point, Shelly, in that more affluent community, $200 is nothing for a holiday present. But I think in the global community where smartphones are going to be much more pervasive than even a bank account among the world’s population, if people are looking to accessorize, and considering 90 plus percent of people will have smartphones even in the next few years, and that’s a stat I’ve seen, I don’t have a source, I’ll have to find it, they’re going to probably accessorize too. I mean, if they find a way to get the phone, what’s the headphones going to be?
So I think lower priced products will have a sweet spot, but I think the way these numbers really panned out came down to nothing more than Apple having such a dominant share of the wearables in US, being one of the leading markets, I think it’ll be interesting as it looks more globally beyond North America because so much of what Canalys put out really was about North America where Apple is so dominant. We’ve got to move on from this particular segment, but it was some good insights. I think the wearable space is very provocative and also to Apple’s credit, while I certainly am one to let them know they are not innovating, they have done a very good job of pivoting into this space and creating some alternative income with the iPhone really sort of wearing at this time.
So let’s jump into our fast fives and Shelly, I’m going to let you go first. Why don’t you start off with this interesting news you found about data breaches on a daily basis.
Shelly Kramer: Data breaches on a daily basis. You know, more than 20 data breaches were reported per day in the first half of 2019 and I’m actually in the middle of an article that I’m writing on this topic that I started writing before I read this. This data comes from Risk Based Security’s latest report for the first six months of 2019, reporting a total of 3,800 data breaches, more than 20 a day, and those breaches exposed over 4.1 billion records. Some of those containing social security numbers, bank account, payment, card information, you name it. And by the way, this was 54% higher than during the same period last year.
You know, security’s a big deal. We’ve talked about this before on this show and I think about this often because one of the things that we discussed on a recent episode was the fact that it’s kind of like, I hate to say it, but it’s kind of like gun shootings in America, you know, another day, another shooting. Well, another day, another data breach. And it’s happening across every industry, in every sector, for companies large and small, for consumers in all walks of life, across all devices. And I think people are sort of becoming a little bit numb by it. And I think that in many instances, consumers, I don’t know that they’re not paying attention, but I think that in many instances they may just not know what to do because it’s happening so much.
And the point that we discussed on an earlier show that gives me angst, is that in many instances it appears as though companies are relying on insurance to cover the costs that will be associated with any kind of data breach. So they’re focusing less on, “Oh, we don’t have to worry about this so much because we have insurance,” which I think is kind of BS. And I think that, well, I know, that not enough is being done to really have a security-first mindset and to be proactive instead of reactive when it comes to security and vulnerability testing, and training of employees, and things like that. So, I think it’s really kind of a bad deal, but that’s an attention-getter, 20 data breaches per day in the first half of the year, and I’m pretty sure that number is going nowhere but up.
Daniel Newman: Yeah, absolutely. That’s a little scary for everyone out there. Security audits are important and hopefully investments are being made. So I’m going to jump in the second one, headline on Lifehackers is do not install your Microsoft Surface’s August firmware updates, parentheses, for now. Little News came out that essentially in their latest update for the Surface Book 2 and the Surface Pro 6, the new firmware update will basically tank your system’s performance. So you have kind of two choices. The first recommendation is turn off updates and pause them for seven days. If it’s already too late, there’s some videos out there. We’ll put a video in the link because I can’t even give you a quick take on what to do. But essentially there are some videos available to help you with the throttle bug as they call it. But ideally within the next few days, Microsoft is going to have this fixed and they will have everyone back up and running. But if you have Surface Book or a Surface 6, hold off on those updates for a little bit.
Olivier, I’m going to throw the next one your way. What’s going on with some new Chrome features that people should want to know about?
Olivier Blanchard: Yes. So if you are a Chromebook user, I have some good news in case you haven’t heard about this. There’s a new update to the entire Chrome OS called Chrome OS 76, so before you get too excited, these types of releases with Chrome, with Google, don’t necessarily happen all at once on all the devices. So this is going to be a little bit piecemeal and you’ll have to check your device to see if it’s compatible or if it’s already kind of accepting the new updates. So look for that 76 next to the OS, and if you see it on your device, you’re having a good day. If you don’t see it yet, don’t worry, it’s probably coming.
However, the details of this is basically new functionality or improved functionality for your Chromebook and the main elements of that are number one, you are now going to have the capability of creating virtual desks on your Chromebook. And what that does is it essentially creates different desktops for different uses. So for instance, if you’re working, like me, on three completely different projects, instead of bunching everything together in tabs on the same place, you can create virtual desks and basically switch from one to the other to keep everything compartmentalized. This is going to be, at least for someone like me, super useful, so I’m very excited about that one.
Another feature is going to be simplified sharing between devices. So you’ll have an extra tab on documents or Windows where you should be able to just go ahead and open that and share it with any devices that are linked to your Google accounts and that are currently active. So for instance, if you have Chromebook, a tablet, a phone, and your Google account is live on that, you’ll be able to essentially kind of beam whatever documents you selected directly to that device without having to email it to yourself or whatever.
Third element of this, which I think is really good, is going to be easier switching between accounts. If you’re like me, you’re using different Google accounts on a Chromebook and sometimes that can be a little bit precarious, switching from one to the other. You might have to sign out and sign back in. With this update, you’ll be able to switch between your accounts much more fluidly. The only caveat is that before you can do that, you will have to resign-in to all of your Google accounts that are not your main account. So there’s a little bit of an extra step on the front end, but then once you’ve done that you’ll be able to switch between them much more easily.
And then the fourth, which is kind of like the least important of them is we’ll have now a central place from which to control media, like the volume or rewind on a video, it will all be in one place and much easier to find than it has been in the past. So all this to say Chrome OS 76, it’s coming, some of it’s already here, and look for that.
Daniel Newman: And for our second main dive, Olivier gave us Chrome OS. Oh, fast five, sorry about that. Shelly, let’s kick it back to you. Actually your second fast five is interesting because it sort of counters your own first fast five because it talks about growth in spend for enterprise B2Bs in security.
Shelly Kramer: It does. I like to stay on topic and on trend, and so the headline that got my attention today as I was preparing was from Channel Futures and they reported on the fact that enterprise security software tops B2B sales.
And so there’s a lot going on in the B2B software market, but when it comes to the demand for information security for software, companies need more sophisticated protection. So there are a lot of things that are driving this. The security software sales, things like firms needing more sophisticated protection as they’re operationalizing their big data strategies, of course the growth of cloud is having an impact. We’re seeing this across the board and I think it’s pretty interesting.
Another thing I thought I would mention is that following one of the recent big data breaches, it might’ve been the Capital One breach, but I’m not sure, I think it might’ve been a European breach. A security software sales company in the UK reported that their sales, their inquiries, had quadrupled because all of a sudden businesses are … I don’t mean to say that businesses aren’t paying attention to security. I think that they are, and I think they’re very freaked out about it and I would hate to be an IT leader or chief security officer, going to bed every night worrying about what the heck is going to happen tomorrow, because I think that there’s a lot of stress involved in that. But it is obvious that CIOs and IT leaders are paying attention to security software and they’re buying a lot of it and they’re going to buy a lot more of it. So, I think that that’s pretty interesting.
Daniel Newman: Absolutely. And let’s end with a little bit of a security topic. Bluetooth. We talked about wearables. Well, how do wearables connect? They connect, well most of the time for us, on Bluetooth. Well, the official body in charge, the Bluetooth SIG standards basically identified a security flaw that could potentially be accessed by hackers that could essentially shorten, you know those little passcodes that you put in when you’re connecting to devices, and they could force that to be shortened to a single octet is what they call it, which would basically mean a single digit, which would allow hackers to essentially force their way to connect to a device through Bluetooth.
The good news is an update has been created and a patch has been put into place. Apple has already put this into place for anybody out there that’s one of those majority we talked about using the AirPods and it’s expanding out there and being deployed out there among all the others. But it’s not the first time that Bluetooth has had a flaw. Just back in June, there was another one that actually allowed Bluetooth devices to be unknowingly tracked. So while Bluetooth, being near field and being close to the device has often been thought about as something that maybe isn’t overly vulnerable, you know when you’re sitting in a coffee shop, someone’s sitting next to you, that signal goes. I mean we all, if you’re like me, you walk around your house, you probably can get 30, 40 feet away from a device and still have perfectly clear Bluetooth signal if you have a good device and a good Bluetooth connection. So something to think about. Bluetooth’s not always secure and if you are unaware, there is a update now that is being put into place to patch that.
Our fast five this week was not the fastest fast five we’ve ever had, but it wasn’t the longest either. We miss you, Fred. So let’s go on to our tech bites section for the week and this one, Shelly, I’m going to let you lead the way on this one. I know this is a topic that’s a little near and dear to all of us, but Facebook, and actually all the AI companies, companies building AI, have had this little issue with these contractors and it’s bringing a lot of tension to how AI is proliferating.
Shelly Kramer: Yeah, I think the news that we’re talking about, the tech bites news, is the fact that Facebook has been hiring third party contractors to review and transcribe audio clips of users, generally of its messenger app. When you’re messaging someone or you’re sexting someone in messenger, like the thought of some, because I know that you guys do that all the time, the thought of… That was funny-
Olivier Blanchard: I’m doing it right now.
Daniel Newman: Ha, ha, ha, ha.
Shelly Kramer: The thought of somebody transcribing, you know, if you’re doing voice messaging, somebody transcribing those voice clips or I mean, it just kind of is gross and I think that, you know, Facebook says that its systems automatically process content and systems, content and communications you and others provide, and they do that to analyze the context and what’s in them, and it generally includes no mentions of humans being involved in that process. But the reality of it is there are third party vendors who support Facebook’s business and they are analyzing how those products are used. So I think that people, you know, it’s another day another thing about Facebook that doesn’t really surprise us, but that kind of creeps us out even more.
Daniel Newman: Olivier, what’s your take on this? I know you spend the second most time out of the three of us on Facebook, but the most time writing Facebook posts. Is this affecting you?
Olivier Blanchard: I hold the world record. Well, yes. So one positive and one negative comment. The positive comment is I strongly suspect that although people are actually listening to this, the content that they’re listening to or that they’re transcribing or that they’re accessing, is anonymized. In other words, nobody is kind of digging into your private life. They’re hearing your conversations, your exchanges are kind of monitored for quality and for learning, they’re accessing all of this information, but they don’t necessarily know where it comes from. There’s not somebody watching you and knowing who you are and following you around. So it’s not like cyber-stalking. So on the one hand, the one positive kind of silver lining about this is, unless I’m wrong, your name, identity, address, all this stuff isn’t necessarily accessible to the people listening to you. So that’s positive.
The negative is that Apple keeps moving the goalpost every time they get caught doing something that they previously said they weren’t doing.
Daniel Newman: Is it Apple or Facebook? Let’s make sure.
Olivier Blanchard: I’m sorry, Facebook, well not just Facebook. All of them, but yeah, it’s Facebook. Sorry, it’s a force of habit. And Google does this too, but Facebook is absolutely the worst of all of these companies when it comes to this. They will kind of vaguely imply that they’re not doing something, and then when they get caught doing it, they’ll say, “Well, remember our comments were not specific about this one thing.” And so Facebook is able to say, “We’re not listening to your conversations,” and then when they get caught, they’re able to say, “Well, we’re still not listening to your conversations. Third-party contractors are listening to your conversations. We’re just reading the transcripts they send us.” Right? There’s always kind of like this sort of layer of deniability that they build into their statements, so they’re not technically lying explicitly, they’re being misleading about what they’re doing and not doing. And that’s a problem that still needs to be addressed.
Shelly Kramer: And one quick data point with regard to this that I think is important is that you can, according to Facebook, opt-out, which is great. But if I’m having a conversation with you and Daniel and I have opted out, but you have not, I’m included in that conversation. So I think it’s complicated because users are, generally speaking, paying zero attention to their privacy settings or what their options are when it comes to opting in, opting out and that kind of thing. So you may think you’re doing the right thing and opting out of these things, but you’re really not.
Daniel Newman: Yeah. The average consumer has no idea and that’s exactly the way Facebook wants it to be. That’s exactly the way the industry wants it to be. Now, I’ve bounced back and forth on this because as a technology proliferation future of work advocate, AI has an important place in it. And human machine partnerships actually take human and machine partnerships in order to get us to the next level. We need people to test what we’re building to make sure it works and-
Shelly Kramer: Haven’t you written a book about this? Haven’t the two of you written a book about this?
Daniel Newman: We did. We did.
Shelly Kramer: Isn’t it just out, right now?
Daniel Newman: Yeah, thanks Shelly. I don’t like to be egregious and Olivier’s even less, but yes, we’ll put a link to the new book in the show notes so that everybody that listens to this episode can go out and buy a copy. Let’s go. But to make it work, you need to actually test it, you need to listen to it, you need to engage it. What concerns me is the just overall market manipulation. The anonymized data or anonymized persona that they all are talking about is flawed because the contractor may or may not know who you are, but that doesn’t mean that the company doesn’t.
And so they’re not anonymizing, at least from everything that I’ve been reading, that all that can be undone and they can definitely tie conversations back to the original parties. You know, as I said in my tweet, pure evil, Facebook, pure evil. But it doesn’t mean I’m going to stop using you and I think you know that. I just don’t use you that much. But I’m on Insta, I use WhatsApp, so they still have me and they know it.
So anyways, moving on, let’s go to our crystal ball. I would love to have actually made this a main dive, but this company is so messed up. I don’t even know they deserve this much time. But at the same time, they are hyping the headlines, gaining all the best tweets because they are literally the personification of a unicorn. WeWork IPO. This company loses money by the boatload as of right now. Their operating margins are terrible and their S-1 was hilariously laughable because we have no idea what this company actually does. It was something about butterflies, rainbows. All kidding aside, they had this really, really high level presentation that all it screams to me is, “Bet on Uber, bet on Uber, you’ll do better,” and Uber lost 5 billion last quarter in case you didn’t catch that note.
So Olivier, Shelly, three months from now, WeWork IPO. Is it going to be up? Is it going to be down? What’s going to happen to WeWork and I’m asking you to give me the 90 days post IPO horizon. Shelly you go first.
Shelly Kramer: I think it’s difficult to say in 90 days. This whole thing is so convoluted. There’s a really interesting article on Bloomberg, an opinion article about this, and it’s talking about the structure of the company and just the laughable things that are in these documents that are part of the IPO. And again, you mentioned this already, the company spends as much running its office spaces as it generates in revenue from tenants and I’m sure that some of that is, “Hey, we make it really cheap so that you can get in and use this and then we’ll jack up the prices on you, which is what we do.” That’s business strategy period, right?
I just don’t know. I don’t know what’s going to happen in 90 days, but I would not be surprised at all in a little bit of a longer term to see some of the same things that Uber has experienced, nevermind they have convoluted management, they don’t have one female on their board, I wouldn’t be surprised to see not great things in their future, but we’ll see.
Daniel Newman: That that should be enough reason for them to tank. What about you?
Olivier Blanchard: Yeah, every everything that Shelly just said. On the one hand they’re a joke. Their mission is to quote, elevate the world’s consciousness. That’s not a serious focused company. Having said that, they are doing something smart. They’re kind of trying to expand beyond coworking into different markets. They’re trying to launch a housing version of this called WeLive because now they’re not, WeWork, they’re The We Company. So there’s WeWork, there’s WeLive, and then there’s also … So WeLive is going to be, I don’t know, dorms for millennials? I have no idea. And then you’re also-
Shelly Kramer: Who can’t afford to live in San Francisco, right?
Olivier Blanchard: Right. Yeah. And we’ve seen stuff like this and evidently it’s working a lot better than it should. And then I think they’re also trying to launch a thing called WeGrow, which is like pre-K or kindergarten, basically it’s just like early education stuff. And I have no idea what that’s about. But that’s something that I think is encouraging because they’re expanding their model and they’re using kind of like this platform thinking to create beachhead in all of those different markets. Having said that, 90 days from now, no, I’m not thinking positive things about 90 days. If anything, if they can continue on their path to growth into these other areas, get their finances under control, and get serious about who they are, if they get better management essentially, then maybe, yeah, three years from now we’re having a different conversation.
Daniel Newman: So I’m going to say down 50% from IPO because I’m going to be very specific.
Olivier Blanchard: And there’s a recession coming, maybe.
Daniel Newman: And maybe I’m using some other indicators. The S-1 is just humiliating. Just to give you guys a feeling from the original first IPO, I found it, you know, Uber, Lyft, Slack, 47, 22, 21, 21% down since their launches. And these are companies that actually have better business models in terms of finances. If I could take one more moment, there’s some very complex disclosures in this company. One of the founders, well not a board member, Shelly, is the wife of the founder and her name is Rebekah Neumann. It looks like Neumann, I’m going to say it’s Neumann, because I don’t want to confuse anybody with Daniel Newman.
But it said this in an article, it says, “The CEO’s wife and a company co-founder’s one of two or three people who would pick a successor if Adam Neumann dies or is incapacitated,” two, “It has already been reported that Neumann has personally owned at least parts of a handful of office buildings that WeWork leases,” don’t like that, three, “And that he has taken out hundreds of millions of dollars in loans secured in part by his holdings in WeWork stock.” I wrote about this a while ago. I tweeted about it. I couldn’t believe it. Head of the IPO. This guy borrowed like 700 plus million dollars against his future IPO making, and I just … Anytime someone’s that fast to hedge themselves and take the money now, I just wonder if they don’t see a great future.
But speaking of the future, another great episode here of Futurum Tech Podcast. Appreciate you Shelly and you Olivier for jumping on with me on this Friday. Everyone out there, please hit that subscribe button. Tune in for each and every week of us giving more of this kind of analysis, opinion, and news. Keep you posted on all the important things going on in tech. Also check out futurumresearch.com and our blog and our research notes. We are publishing like crazy, lots of thoughts, lots of ideas. For everyone out there, we appreciate you joining us. For now, signing off. We’ll see you later.
Disclaimer: The Futurum Tech Podcast is for information and entertainment purposes only. Over the course of this podcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we do not ask that you treat us as such.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
