Products

Technical

• Customer-Facing
• Brand dashboard
• Non-Customer-Facing
• Internal Tools
• Inventory Management
• Fulfillment Management
• Distribution
• Boxing Algorithm
• Product Distribution Algorithm

Non-Technical

• Distributed storage
• Distributed Packers & Shippers

Industry

• What are broader changes that are occurring in the industry?
• Logistics
• Supply Chain
• 3PL
• Technology
• Venture Capital

Exercises

Big Bet(s)

Moat

Big Bet(s)

Decision Tree

• “If you can write and diagram a complex decision tree with many alternatives, explaining why your particular plan to navigate the maze is superior to the ten past companies who died in the maze and twenty current competitors lost in the maze, you have gone a long way toward proving you have a good idea others did not and do not have.” — Balaji

Resurrecting Dead Technologies

• In addition to technologies nobody knows about from the lab, other opportunities are technologies people have already written off. Look for things people think of as “dead” or as not having worked and find out why.

Human → Human/Machine → Machine

• A framework I use often is the evolution from the physical version to the intermediate form, and then to the internet-native version. If you’re into electrical engineering, you can think of this as the evolution from analog to analog/digital, and then to native digital.
• We transitioned from paper to a scanner that scans paper into a digital version and then to a native digital text file that begins like on the computer. We transitioned from face-to-face meetings to Zoom video meetings (a scanner of faces), and then (sson?) to native digital VR meetings. We transitioned from physical cash to credit cards and PayPal (a scan of the pre-existing banking system), and then to the native digital version of money: cryptocurrency.
• Once you see this pattern, you can see it everywhere. Look for places where we’re still stuck at the scanned version — where we’ve taken an offline experience and put it online but haven’t fundamentally innovated. These are opportunities for innovation.
• For things we can do completely on the computer, productivity has measurably accelerated. Emailing something is 100 times faster than mailing it. But a slow human still needs to act on it. One theory: humans are now the limiting factor.

Core Competency → Primary “Function”

• Trying to reduce a company’s core competency to the functions it implements is a thought-provoking exercise. We could see huge companies run by only one to two people providing a single function.
• A good question for a software company is: what’s your billion dollar function? For Facebook, it’s arguably the function that allows advertisers to put ads in front of users. The defensibility comes from its database. It’s likely not a single function today, but it probably was or could be.
• This concept is perhaps less useful for companies with significant offline components. Uber’s function could be to take in two (x, y) coordinates and move you between them. I guess you could say it’s a function where the state it updates is your GPS position, though it’s not as elegant.
• If you are using software to go after a physical legacy industry, one option is to do it “full stack”.
• Replacing just one layer of an outdated legacy stack is hard. Customer acquisition and integration costs can kill you. That’s when you go full stack. You can reinvent then reintegrate multiple pieces of an old industry and make better margins. Consider “restaurant powered by technology” versus “tech for restaurants”.

Key Value Props:

• Visibility
• End-to-end → Full-stack
• Actionable

Future

• Blockchain running supply chain
• IoT → Internet of Things
• AR glasses in warehouses
• Robotics
• Automated packaging
• Drones
• Delivery drones
• Warehouse drones
• Generative AI