As South Africans saw the news that Port Elizabeth has a new name, local Google searches for how to pronounce Gqeberha surged. Minister of…
One day soon, the world will forget who Guy Kawasaki is and they will start obsessing about a guy named Travis Kalanick who started a glorified taxi company.
The reason: one of them (Kawasaki) seems to think it’s okay for investors to be lazy about looking outside their locational scope when it comes to investing in technology. The other (Kalanick) thinks you should chase the market all over the world even though there are laws being created just to keep you out.
It’s okay to be lazy as an investor
“Why fly 30 hours to lose money there, when you can lose the same amount of money closer to home?” Kawasaki asked the LeWeb audience in response to a question about investing outside the United States.
Interestingly the response was a stark contrast to an earlier statement to entrepreneurs where he said that if investors want you to move closer to the money you should say no. He likens investing to falling in love and meeting someone in a foreign country and telling them to follow you back home or the relationship will not proceed.
“For technology investors, when you fall in love and find something that could be the next Google or Facebook or the like, it’s not a matter of making them move to where you are,” he says.
His message is try to make it work, or maybe not.
Kawasaki seems to think that taking the time to travel to other parts of the world that aren’t in your current sphere is not all that worth it. The former Apple executive seems to think sure, the next Google could be built in Africa and a Silicon Valley investor will miss it, but that’s a prize worth paying for by not sitting on a plane for that long.
To be fair, from an investor point of view it’s a difference story:
“As an investor it’s very difficult — I don’t know about the laws in your country for instance. I don’t know if you can offer options or IPOs. I don’t know anything about it. The typical investor looks at thousands of opportunities a year and invests in 20 or something like that,” says Kawasaki.
If one comes along that says ‘now I have to understand South African law or Indian law’, investors have to go to board meetings that are 30 hours away — something that he says adds speed bumps to your deal.
He reckons that companies seeking money from Valley investors need to make it easier — after all, they are asking for the money. Hold up Guy — didn’t you just say startups shouldn’t move for investors because if the company is that good and you love it you will make it work?
“Yes, there could be the next Google in Africa and the American investor would not see it because of this,” he says.
Nastygrams: getting cease and desist letters
Kalanick doesn’t seem bothered about spending 30 hours on a plane to expand his growing company even though laws are being created to keep him out.
“There is a criminal complaint against Uber in Seoul. On this trip, I made a stop there where I was questioned by the police for three and half hours about it,” the CEO told the LeWeb audience.
The company is rolling out in every major city with a big push in Asia right now, and has faced some challenges in some of its new markets as well as its old ones.
According to Kalanick, in Seoul, it’s illegal for Koreans to use his service but it’s okay for foreigners to use it. In France there is a law that is being proposed to make users of Uber wait 15 minutes before getting into an Uber even if it arrives five minutes after it has been ordered.
He calls laws like these protectionist, as they aim to protect the existing taxi industry rather than reduce friction and make getting around easier.
Uber, with a US$3.76-billion valuation, is a company that is disrupting the private driver space. Currently in 40 plus cities and almost every major part of the world, the company is aggressively chasing new markets and finds the opportunities wherever they may be.
“We’re in the business, today, of delivering cars in five minutes. But once you’re delivering cars in five minutes, there’s a lot of things you can deliver in five minutes,” Kalanick says. “If someone is doing ‘Uber for X’, whatever it is, and it matches that lifestyle and logistics thing, you can count on Uber doing it.”
With around 500 staff after three years and 300 of them spread around the world in individual city teams, for Uber, each city is a new startup that its head quarters technically invests in.
“We have operations in every city we have launched,” says Kalanick. “We keep getting these cease and desist letters some from city we are not even in, like New Orleans. These are just nastygrams, all it means is someone doesn’t like you, not that you are doing anything wrong.”