Fun interview in Le Monde

I had the pleasure of being interviewed by Benoit Hopquin from Le Monde last June while I was passing through Paris. He was interviewing a variety of people, Buddhist monks, retirees, etc., for a series on happiness. He had come across my interest on the topic and reached out to me.

We had a really fun conversation and I ended up embodying “happiness in motion”. I have to admit it was a real pleasure to partake in the project as France needs dreams, optimism and happiness more than anything right now.

You can read an extract of the interview at:


Great Steve Jobs Quote

“When you grow up you tend to get told the world is the way it is and your life is just to live your life inside the world. Try not to bash into the walls too much. Try to have a nice family life, have fun, save a little money.

That’s a very limited life. Life can be much broader once you discover one simple fact, and that is – everything around you that you call life, was made up by people that were no smarter than you. And you can change it, you can influence it, you can build your own things that other people can use.

The minute that you understand that you can poke life and actually something will, you know if you push in, something will pop out the other side, that you can change it, you can mold it. That’s maybe the most important thing. It’s to shake off this erroneous notion that life is there and you’re just gonna live in it, versus embrace it, change it, improve it, make your mark upon it.

I think that’s very important and however you learn that, once you learn it, you’ll want to change life and make it better, cause it’s kind of messed up, in a lot of ways. Once you learn that, you’ll never be the same again.”

(The quote came from a Silicon Valley Historical Association’s 1994 filmed interview of Steve Jobs and appeared in the documentary: Steve Jobs: Visionary Entrepreneur.)

How to launch your startup

Paul Graham just published yet another must read blog post. This one is entitled Do Things that Don’t Scale. It’s essentially a how-to guide on launching your startup. He suggests eschewing the traditional “big launch” and instead manually recruiting your first customers. The advice is invaluable. It’s not scalable to manually recruit customers, but by personally attending to their needs you have the dual opportunity to better understand and delight them. When is the last time the Founder & CEO of a company took care of your personal needs? It’s a level of service and attention your small and nimble startup can offer that your competitors can’t, so make the most of it.

Moreover, people underestimate the scale you can reach using this approach. I was recently talking to the founders of a two-sided marketplace who had an addressable market of 10,000 suppliers. They were thinking of distributing flyers to reach them. Horrified, I pushed back. I asked them how many people they felt they could individually pitch to if they did it 10 hours per day. They felt that they could talk to around 20 potential suppliers per day. In other words with 5 people, including at least 2 of the founders, they could talk to 100 potential customers per day. In 100 days, a little over 3 months, they can talk to every single supplier in their market. They would also deliver a much better and personalized pitch than the flyers or advertising they originally wanted to use. Seen in this light the supposedly non-scalable is actually essential!

In a similar vein I recommend that founders personally handle customer care emails and calls when they launch their startup. I did it at Aucland, Zingy and OLX in the months following the launch. It really helps to understand what the main issues and suggestions are.

Good luck with your launch!

Let’s reinvent PC gaming!

In addition to the decline of PC gaming described in my previous blog post (The Rise and Fall of PC Gaming), the business model of game development is broken for most developers, on both consoles and PCs. They spend millions to build a game. They sell it for $49.99 for a few months, at best, in an ever more hit driven environment dominated by mega-productions. In a way it’s like the movie business. $200+ million blockbusters and low budget horror movies are profitable. Everyone in the middle is getting squeezed and fewer of the smart dramas I would like to see on screen are getting created. This is true with games as well. The mega-productions like Call of Duty and Grand Theft Auto cost hundreds of millions to make and generate hundreds of millions in sales. Tiny developers, which are often single employee operations, can scrape by with sales on Steam. Everyone in the middle is getting squeezed. As costs are escalating even $100 million games like Eidos’ excellent Tomb Raider often end up losing money. Tomb Raider did not break even despite selling 3.4 million copies! That’s why I blogged a few years ago that despite being a gamer, I don’t work in the gaming industry:

Notwithstanding the dire tone of my last blog post and this introductory paragraph, there are some bright spots in PC gaming. Steam’s rise to prominence provides real distribution to independent game makers who cannot command shelf space at GameStop. PC games are uniquely positioned to pivot to a different business model. A lot of the costs of building games come from creating a compelling single player campaign. It requires careful scripting, storytelling and often human actors to provide 10-20 hours of entertainment. Yet the multiplayer component of the best games provides hundreds of hours of entertainment to avid players.

As such, I propose that we build PC strategy games with the following approach:

  • Free to download
  • Exclude a single player campaign and any scripted elements
  • Include a tutorial and unlimited single player games against the AI at various difficulty levels on random maps
  • Require a $9.99 / month subscription for online playing of any sort (co-cop comp stomps and multiplayer games)
  • Allow users to play from any computer, but only one person can be logged in at a time per paying account

This approach has multiple advantages:

  • Many people would try the game because it’s free to play the full featured game with all its functionality
  • The lack of campaign lowers the development costs
  • Piracy risks are limited because you need a paid account to play online and you actually want the free version to be as widely distributed as possible
  • Avid fans who really value the game are the ones paying to use it
  • The ongoing revenue stream also allow to cover ongoing improvements and unit balancing

I am toying with the idea of starting a Kickstarter to fund a next generation real time strategy game using this model. The category is currently reasonably small. Starcraft II is probably the only game with high revenues in the category and I find its game mechanic a bit disappointing. The only real innovation has come from Company of Heroes’ tactical unit control, which was revolutionary when it was introduced. That said, I long for a real time strategy game that has the depth of Rise of Nations, which I feel is the best real time strategy game of all times (slightly ahead of Age of Empires II). Unfortunately, the last extension to that Game “Thrones and Patriots” came out in 2004 and Big Huge Games has since disbanded. Likewise Microsoft shuttered Ensemble Studios, the maker of Age of Empires.

I propose to build “Age of Nations” or “Rise of Empires” combining the best elements of Rise of Nations, Age of Empires and Company of Heroes. The features would be as follows:

  • The richness of strategic options of Rise of Nations in terms of number of resources, ages and concepts like borders and attrition
  • The tactical unit control of Company of Heroes where cover, elevation, and angle of attack influence the effectiveness of troops
  • A dynamic environment that can be destroyed like in Company of Heroes
  • Beautiful modern graphics taking advantage of the latest hardware
  • Automatic multiplayer matching for 1v1, 2v2 and 3v3 games on par with the one in Starcraft II
  • The ability to create custom multiplayer games with friends with or without AI players
  • The ability in multiplayer games to have multiple people control one faction, either by explicitly splitting roles: one controls troops and the other the economy, or by giving them full control and letting them figure it out
  • If possible, a strong AI that does not need to cheat (but that might be dropped if too expensive)

I am reaching out to Brian Reynolds, the lead designer of Rise of Nations, Bruce Shelley, the lead designer of Age of Empires, and Josh Mosqueira and Quinn Duffy, the lead designers of Company of Heroes to pitch them on the idea and price it out.

If they acquiesce we’ll create a Kickstarter for the project. In the meantime, I bought as a precautionary measure 🙂

I am open to suggestions and feedback!

The Rise and Fall of PC Gaming

It has been interesting, and a bit sad, to observe the rise and fall of PC gaming. Ever since I got my first PC in 1984, the primary impetus for upgrading my PC was getting a computer and graphic card powerful enough to play the latest games. It was a wild ride on the way up every step of the way – 8088, 80286, 386, 486, Pentium and beyond. Likewise, with graphic cards and sound cards, hearing the names SoundBlaster, Roland MT-32 and Voodoo always brings a bout of nostalgia.

As I previously mentioned in “How it all began“, the 1980s was the decade of the point and click adventure games, with the amazing Sierra “Quest” games (King’s Quest, Police Quest, Hero’s Quest, Gabriel Knight, Leisure Suit Larry and countless others), followed in the early 90s by the LucasArts games like Monkey Island & Indiana Jones.

The 1990s were the apogee of the PC gaming market. You saw an explosion of genres and creativity. Turn based strategy games, real time strategy games, space combat simulators and first person shooters either made their first appearance or hit their stride. With turn based strategy games, SSI’s Sword of Aragon in 1989 was the first engaging entry in the genre, which really took off with Sid Meyer‘s revolutionary Civlization in 1991. Warlords and Panzer General were also great additions to that pantheon. With real time strategy games, Dune 2 defined the genre which was then expanded and bettered by Warcraft (II especially), Command & Conquer, Age of Empires and Rise of Nations – especially since they brought multiplayer gaming. Wing Commander became the standard bearer for space combat simulators. Wolfenstein 3D and its spiritual successors, Doom and Quake created the category that would conquer all: the first person shooter or FPS.

Despite the explosion of sales of PC games in general, adventure games had already started their decline notwithstanding excellent games like Gabriel Knight, The Longest Journey and Syberia. In a world of immediate gratification, gamers no longer seemed to have the patience to comb for hours for clues to solve ever more complicated puzzles – especially since the solution was increasingly becoming available online a walkthrough away. I remember spending months stuck in Kings Quest 3 looking on BBS’ to understand what I was supposed to do next. You can’t imagine the amount of satisfaction I felt when I finally figured it out.

Since 2000, PC gaming has been on the wane even as gaming in general has exploded. Casual gaming took off with the rise of social games and mobile games. Hard core gaming as a category exploded on consoles as well. The sales of top titles like Call of Duty reach billions of dollars. Gaming as a whole generated over $63 billion in revenues globally in 2012 ($15 billion in the US), more than the movie industry’s $35 billion in ticket sales ($11 billion in the US).

Many people have opined on the cause of the decline: the prevalence of piracy on PC, the shortening attention span of gamers who only have the patience for a FPS or a casual game, etc. Most suspect piracy is the answer. It is true that it’s easier to pirate games on PCs than on consoles, but the reality is that it’s not that hard to pirate games on consoles either. Moreover, when some PC game makers like Stardock Entertainment (maker of Sins of a Solar Empire) removed their DRM and trusted their customers their sales went up. I can imagine users are annoyed by complex copy protection schemes.

I suspect that the answer is simpler: when you put a game in a console, you know it’s going to work. Likewise, if you want to play online the experience on Xbox Live is far better than what most PC games manage. That user experience is provided at a fraction of the cost of a proper gaming PC – $300 instead of $2,000-$3,000). At the same time, consoles narrowed the graphic quality gap significantly starting with the PS2. Obviously high end PCs costing thousands of dollars have better quality graphics, but for most PC owners, their console is as good as their PC. Moreover, on consoles everyone gets the same experience and you don’t need to set shader quality, anti-aliasing, etc. before launching the game. Brad Wardell, CEO of Stardock seems to agree:

PC gaming has come a long way since the 1980s and 1990s. When we wanted to play multiplayer games, we would bring PCs to each other’s places and network them together to create a LAN party. PCs were so finicky that it would typically take hours before we were up and running. We often had to completely take apart the computer and replace the motherboard, hard drive or network card. We had to use special software like QEMM in order to have enough memory to play the game to begin with. Worst most games did not include Internet support and we had to use IPX tunnelers like Kali to transform IPX into TCPIP to play online. You can imagine how few people actually really did that. With the introduction of DirectX and the increasing abstraction of the hardware layer, PC gaming became simpler and more stable. However, it’s still not guaranteed that the game will work and your experience varies dramatically depending on your PC.

As a result most genres have moved to consoles: FPS (Call of Duty & Battlefield), third person shooters (Gears of War, Max Payne), RPGs (Skyrim, Witcher) and action games with adventure components (Tomb Raider, Drake Uncharted, LA Noire, Grand Theft Auto, Assassin’s Creed). The only holdouts are MMORPGs and strategy games, which to date have required a mouse. They are frankly only really represented from a revenue perspective by Blizzard’s World of Warcraft and Starcraft II. Civilization V, Company of Heroes and Sins of a Solar Empire try as they may are still much smaller.

I also suspect that MMORPGs are going to move to console. The controller is clearly good enough for RPGs (most RPGs are played on consoles) and the online gaming experience is already fantastic. Blizzard’s upcoming release of Diablo III on consoles may be a harbinger of things to come. In other words strategy games may end up being the only holdouts.

The pattern above is definitely reflected on my gaming experience. I just finished Tomb Raider my Xbox 360. I am currently playing The Last of Us on my PS3 and play Black Ops II multiplayer on Xbox Live. I play Company of Heroes II, Fallen Enchantress: Legendary Heroes and Civilization V on my PC.

As it stands, PC gaming seems to be on a terminal decline. It’s no longer leading PC upgrade cycles and gamers and game makers seem to be abandoning the platform in droves.

The time has come to reinvent PC gaming!

Why does the world exist is a thoughtful and compelling read

Jim Holt deftly tackles one of most profound questions in philosophy: “why is there something rather than nothing?” To tackle the question of existence he deftly takes us through the history of the philosophy and physics on the issue presenting the case of theists and atheists alike.

To answer the question Jim travels around the world and discusses the issue with leading thinkers including Oxford philosopher Richard Swinburne, Oxford physicist David Deutsch, Pittsburgh philosopher Adolf Grünbaum, the Platonist mathematician Roger Penrose, the writer John Updike and the Nobel Prize-winning physicist Steven Weinberg. In so doing they discuss the perspectives of many luminaries from Plato, Leibniz and Spinoza to Einstein and Feynman.

As you might suspect he finds no definite answer (though he feels compelled to give his perspective), but the journey itself is extremely rewarding.

A must read for all who ponder the mystery of existence!

3D Printing will change the world

It seems a foregone conclusion that 3D printing will change the world. It’s already revolutionized prototyping, and we’re now getting a glimpse of the technology’s potential in mass customization, medicine and home use. It’s easy to imagine a future where everything is bespoke: even items mass manufactured in China will be complemented with 3D printed customization in stores. Once printers become commonplace in the home, one can conceive printing custom glasses and plates for a dinner party. In medicine, hospitals are already printing structural body components. In labs they are working on printing out organs, though it will be a while before this becomes commonplace.

As 3D printers are following (a somewhat slower) Moore’s law in terms of improvements (finer resolution, multi-material printing, etc.) and cost decreases, we can foresee a day where they will be common in the home. So far, no killer application has been invented for them, but one seems bound to come. Toy printing is already a large category as kids’ appetite for custom toys seems infinite.

Given that global world product is $72 trillion in 2012 nominal dollars, and that industry represents 30% of that, a whopping $22 trillion dollars of economic output faces revolution. I have considered what part I should be taking in this revolution and so far have come up short. Each time I considered an investment thesis, I discarded it.

Here are some of the options my team and I considered:

1. Invest in the printer makers:

We had the opportunity to invest in Makerbot reasonably early on. We passed on the investment because hardware manufacturing is capital intensive. We also felt it would ultimately be low margin as many deep pocketed players would enter the market, not least of which will probably be HP, whenever the market becomes big enough.

Also given the speed at which the technology is evolving, if you miss one of the development / upgrade cycles, you might be out of the game completely. This happened in other hardware manufacturing industries. In video games it looks like the Wii U’s misfire might mark the end of Nintendo as a console marker (as previously happened to Sega and others in the gaming market). A similar development is occurring in cell phone and television manufacturing.

Given MakerBot’s recent acquisition for over $400 million by Stratasys, in hindsight the investment would have been successful. That said, our concerns and investment thesis remain with regards to investing in 3D printer makers.

2. Invest in companies that print on behalf of others:

There are numerous very large companies that do industrial 3D printing. A few of them are even publicly traded. This is very far from my core expertise. Instead we considered investing in companies that print items on behalf of consumers: “the Shutterfly of 3D printing”. The leading company we looked at is ShapeWays.

We again passed on the investment. Ultimately people will have printers in their homes and the third party printing category will shrink and be limited to niche high end items. We are probably right on the vision, but a bit early on our expectation of home penetration of 3D printing. In this light passing on this investment will likely prove a mistake. However, even if Shapeways does extraordinarily well, we won’t have regrets: we don’t like investing in businesses in which we don’t see a viable long term future – even if it means we miss out on good investment opportunities on a 5 year time horizon.

3. Invest in companies that make tools enabling 3D printing:

To print a 3D item you upload a 3D file in the language of the printer. Many such files are built in Autodesk’s Autocad. Given the expense and complexity of the software, we considered investing in simple online 3D building tools, like TinkerCad. Again, we could not be convinced of the robustness of the business model. In this case the decision proved fortuitous as TinkerCad was recently absorbed by Autodesk.

4. Build or invest in a marketplace for 3D printable files:

This idea resonated the most with us. Given the success of Shutterstock and Fotolia, it makes sense that ultimately such a marketplace will exist for 3D printable files. A few such marketplaces already exit, with limitations. Thingiverse, Makerbot’s marketplace, is 100% free, and does not allow makers to monetize their designs. Moreover it’s limited to Makerbot printers. Shapeways’ marketplace allows designers to monetize their work, but only through printing via Shapeways, not by downloading a file to your own printer.

We had the idea of creating a universal cross-printer, multi-category 3D printable file marketplace that would allow designers to upload their work and make them available for download at a price of their choosing or for free. As we did not find any startups that were pursuing this vision we seriously considered starting one, but decided not to pull the trigger yet:

  • There is no DRM on 3D printable files. Someone could just buy 1 paid copy and upload it on all the torrent files, other marketplaces, etc. Contrarily to stock photography where image owners can observe piracy and try to limit it, people would print at home and out of sight. In addition soon you won’t need the original file to replicate an item. A 3D scanner can create the file further increasing the risk of piracy.
  • It’s unclear that 3D printable files are actually copyrightable, as they are merely a set of coordinates where you either have matter or nothing.
  • Testing the printability of each file on every printer might be complicated, though I suspect we can programmatically check the file compatibility with a given printer.
  • For the marketplace to take off, the penetration of 3D printers would have to be significantly higher than it is today. As a result, it may take years before the marketplace could generate the revenues sufficient to cover the operating expenses of a 5-10 person programming team.

If someone had the patience to try to impose DRM norms on the industry by creating an open source standard, work through the copyright issues, and could find funding to survive for years without revenues (most likely by having a super low cost structure), it would make sense to pursue this idea. It will be huge once 3D printer penetration hits critical mass. Given the importance of liquidity in marketplace businesses, I suspect someone starting today with a mostly free marketplace will be the winner when the time comes. If we wait for 3D printer penetration to increase it will be too late.


In retrospect, perhaps we should have invested in all good teams in the industry, across the various business models, as a secular bet on the category. We have not done that yet but it’s definitely not too late. The business is still in its infancy – akin to the PC before the Macintosh. Lots of interesting things were being done during the Altair period but no one made money on it in the 1970s. It’s only in the mid-1980s and 1990s that it took off. Granted, cycles have compressed and this will take less time, but then as now the early leaders won’t necessarily be the long term winners.

Non-sequitur: Parents should definitely buy a 3D printer for their kids. The printers today are slow, reasonably expensive and functionality limited. Those limitations will encourage the most curious kids to start playing with the programming language to get as much as they can out of the printer. After all, kids have the perfect incentive to learn to program them: they can make cool new toys all the time! Kids who grew up with computers in the 1960s, 1970s and 1980s learned to make the most of their limited capabilities and became the leaders of the computer and Internet revolutions. I bet some of the kids who start playing with 3D printers today will be the Bill Gates and Steve Jobs of the 3D printing market 10-15 years from now as they will have had the requisite 10,000 hours of deliberate practice by the time they hit their early to mid-twenties – prime startup starting age!

All that to say, I love the category and would love to find an intelligent way of participating in it as an investor or operator. If you have suggestions for how I should do so, send them my way.

3D printing is going to change the world. Get ready for it!

David Rowan’s experience at Singularity University is a must read for everyone interested in thinking and learning about the future!

I had the pleasure of chatting with David while at Martin Varsavsky’s Tech Talk Menorca and was fascinated by his recounting of his experience there.

If you have a modicum of curiosity about the future you owe it to yourself to read his article in Wired summarizing his experience at Singularity University: