Nice wrap up on SAI, from a Quora post about how apple uses its massive cash resources:

When new component technologies (touchscreens, chips, LED displays) first come out, they are very expensive to produce, and building a factory that can produce them in mass quantities is even more expensive. Oftentimes, the upfront capital expenditure can be so huge and the margins are small enough (and shrink over time as the component is rapidly commoditized) that the companies who would build these factories cannot raise sufficient investment capital to cover the costs.

...

Apple is not just crushing its rivals through superiority in design, Steve Jobs's deep experience in hardware mass production (early Apple, NeXT) has been brought to bear in creating an unrivaled exclusive supply chain of advanced technology literally years ahead of anyone else on the planet. If it feels like new Apple products appear futuristic, it is because Apple really is sending back technology from the future.

Reminds me of the Clarke's Third Law:

Any sufficiently advanced technology is indistinguishable from magic. -[Wikipedia]

By painting Apple as a new untouchable in the CE industry, has Dave Morgan taken the liberty to show us that the consumer experience trumps just about everything else?   After a decade of losing Apple vs. IBM comparisons (in which I,  as a boy, defended Apple to the ends of the earth, aided by my weekly infusion of MacWEEK) can Apple have a further decade of dominance? Eerily familiar to descriptions of IBM in the 1960s or 70s.

Apple: The First Trillion-Dollar Company? 01/13/2011:

Apple is out-innovating and out-executing the entire market. No other company is delivering better consumer electronics products with better content and communications experiences to the market, and iterating them constantly, than Apple.? Not only that, but no one else is delivering consumer electronic products and related software and content at the scale, and with the degree of customer service, that Apple is today. Not Sony. Not Samsung. Not LG. Not Google. No one.

The business of video on demand was possible and eminently doable in 1994-95.  Most of the cable companies buried their heads in the sand.   IBM was content selling servers, having lost the DOS vs. Windows battle (or even OS2/Warp!)  Yet we didn't see it for more than a decade in most US Cable households.  

Great products and ideas die, all the time.  I personally never owned a mac clone, but some of those machines were really insipiring piecves of machinery.  Gil Amelio couldn;t save Apple, but Jobs did.  He rebooted the company.

And that's why the powerhouse that Apple has become, can't last forever.  What IBM has build doesn't rely on one person, ditto to GE, Comcast, Verizon.  Apple has a lockup on the fringe, but it can't take the mass.  The mass just won't tolerate it.

David Pogue suggests this morning that CES was a sideshow of Apple copycats.  His money quote from an industry insider:

“These companies are like 6-year-olds on a soccer team,” one company representative told me. “The ball goes over here, and they all run after it in a blob. ‘Tablet!’ ‘Tablet!’ ‘Tablet!’ ”

The innovation, however, is moving to the cloud- the services on top of the devices.  That will keep shiny, new things on our TVs for now.  See InsideFacebook's The Best Facebook-Integrated Devices from CES 2011.

But it can't last longer than Steve Jobs.  Even as Steve keeps the fanboys cheering (and even some day clicking the "like" button) he hasn't build anything that can outlive him.

Well, maybe, just maybe, it's fixing the news business! (via Fake Steve Jobs)

The news business has descended into the gutter in a pathetic attempt to stay alive. It’s been a horrible race to the bottom. This is turn has polluted our politics, and now we’re seeing the result of it.

Fortunately for the world, we’re going to change all that, with iPad and the apps model. But that’s a story for another day.

Editors Note (1/7/11): I’ve now posted my guide to learning how to code – The HoPE Manifesto.

The other day, my friend Charlie O’Donnell wrote a post challenging the NY tech industry to recruit or educate 250 new engineers to the NY early-stage tech ecosystem this year.

Today, Fred Wilson upped the stakes and called for 1000.

I have a different challenge: Can 1000 of us learn how to code in 2011?

I already did. It took me one solid week of really, brutally hard work, and then an ongoing passion and interest (which has translated into two solid months of coding and learning on Ohours when I have the time).

For as long as I’ve been involved in the NY tech industry we’ve made cries for more engineers to a) move here; or, b) abandon/avoid Wall Street so they can join our silly startups that are “changing the world.”

What if instead of calling on others to do things we just looked to ourselves? Aren’t we the change we are waiting for?

If you’re willing to put in the time to learn — and if you’re really passionate about something, the time and energy comes freely — then learning to code really isn’t that hard.

Once you can code, the entire dynamic changes. Instead of early ideas needing more money so we can hire more engineers, startups founded by people who can do the work become more self-sustaining.

Example Ohours:
Ohours is a great idea with some early traction I’m excited about. If I didn’t know how to code and was paying — in financial or social capital — a developer each time I needed a change or update to the site, a) the site would be a lot worse then it is today, because we really couldn’t make updates that often; and b) our risk/reward profile would be way out of whack. I’d go raise angel financing, deluding myself and the investors that *now* was the time to invest in what’s still a stupid-early project, I’d then I’d use that money to tie up an engineer in a non-proven startup. In the current model, everyone is over-invested and a great engineer is out of the market.

Sure, it would be great if NY tech was able to recruit more engineers and keep college hackers away from Wall Street — I 100% agree — but it’s not going to happen just by wishing it to happen. And, the more “business people” (like me for the past 4 years) whine about the lack of engineers rather than turning themselves into engineers, the less I see us attracting people.

So you know what would really turn things on its head? If every damn “business person with a great idea” in this town decided to take a bit of time and actually learn how to code and built it themselves.

1. First, we’d alleviate demand put on the talent pool by non-proven businesses.
2. Second, we’d have an increased yet more sustainable rate of creation and creativity in our market
3. And last of all, I guarantee that — when the startups founded by newly minted hackers actually needed to expand and hire talent — we’ll be a heckofalot more attractive place to move to/work for (’cause if you were a hacker, would you really want to work for people who didn’t have it in them to learn to code?).

So who’s coming with me? Can 1000 of us learn how to code this year? Sign below in the comment thread if you’re with me.

And after 1000 of us learn to code, I’m sure we’re get those 1000 new engineers the old-fashioned way.

This post will cover the first of Robert Cialdini’s 6 Weapons of Influence:  Reciprocity.

The basic idea here is that if someone does a favor for you, you’re psychologically “hardwired” to return the favor.  In his book, Cialdini introduces this topic with a re-cap of an experiment a University Professor conducted:

The professor sent Christmas cards to a bunch of random people.  He originally expected get maybe one or two responses, he didn’t fathom he’d get what he did: “holiday cards addressed to him came pouring back from the people who had never met nor heard of him.  The great majority of those who returned a card never inquired into the identity of the unknown professor”.

The card recipients simply followed the “hard wiring” of their brains and returned a favor done unto them.

So let’s see how this psychological law of Reciprocity can be put into effect on a landing page…

eHarmony.com

Check out the screen cap below.  What’s the first thing you notice (besides the obnoxiously happy couple)?

An offer for a “Free” service!

We’re all smart enough to realize that eHarmony isn’t doing this out of the kindness of their match-making hearts.

Oh no no no…this is an attempt to exploit the Reciprocity principle:  Get people in the door with a free offer to meet the man or woman of their dreams, and then hit them up for cash once they think they’ve found that person.

It’s subtle in the sense that they’re not coming right out and saying, “Hey we gave you access for free…do us one in return and fork over your credit card number!”.  But they let you know up front that this is a free way to find your soul mate, that no credit card is necessary, etc.  They’re tearing down your built in defense mechanisms.

This is all part of eHarmony’s carefully designed landing page and sales funnel:  Give away part of their service for free, get someone’s email address, and continuously pitch them to join as a paying member.  It all starts with the free offer and that relies on the Reciprocity principle.

SouthBeachDiet.com

Ok, so maybe love starved consumers are easier to sell.  Maybe it’s not the Reciprocity principle coming into play, maybe it’s a guy or gal that simply needs a date…badly.

So let’s take a look at another site:  SouthBeachDiet.com.

You’d think that on a diet site, the first thing they’d want visitors to see are pictures of super-skinny models or dramatic “Before & After” photos.  That would really get people excited about purchasing some products, right?

Wrong.

The first thing you see in the screen cap below is a big red arrow pointing to a form on the right side of the page.

And that form is a prompt for a  “Free Diet Profile”.  The call-to-action button even has the word “free” in it:  “Free Profile Results”.

Again, a carefully designed marketing funnel that begins with an offer for something free in exchange for an email address (and ultimately a purchase).

WebsiteGrader.com

Ok fine, maybe dating and dieting are such emotional and personal experiences that people can’t help but get sold on offers like these (whether or not they got something for free up front).

What about something less emotional and more along the lines of cold, calculated business decisions?

Would the Reciprocity principle work on a savvy CEO looking for a new marketing vendor?

You might be shaking your head saying “No way!” right now, but check out WebSiteGrader.com and then tell me what you think.

These guys offer you a free SEO analysis of your site.  They even give you a “score”.

Out of the kindness of their hearts?

Hell no!

Website Grader is owned by the marketing company, HubSpot.  And you can bet this is yet another carefully designed funnel that leverages the Reciprocity principle.  Check out the other “Grader” websites they own:



Bottom Line - Reciprocity is a Powerful Weapon

Industry, product, etc., it doesn’t matter — the psychological law of reciprocity can be used in any marketing funnel or landing page design to make it more effective.

However, this doesn’t mean you should start offering free cups of coffee to visitors on your site and expect them to sign up for your paid product.  There are some additional rules of thumb to employ as you think about your “freebie” offer:

1.  Make sure your free offer relates directly to your core product offering.  A free “diet profile” for a diet system is a logical way to upsell someone (e.g. “Oh look, you’re kind of fat, how about you buy our fat burning system today!?”).  Same goes for SEO services — “Oh wow, your website has a SUPER LOW SEO score…we can help with that!”. 

2.  Don’t give away something of greater value than your core product offering.  I doubt many people would make this mistake, but I have seen it happen.  A buddy of mine was offering a free telephone consultation when he was first getting his business off the ground.  And while that worked when he only had 1 - 2 leads trickling in per day, it became cost prohibitive (from an opportunity cost perspective) when he had 50 new leads coming in per day.

3.  Please be sure that whatever you’re giving away actually adds value to the user.  Don’t think that simply because it’s free they’ll find value in it — sometimes things are free because they suck and folks don’t find it to be valuable enough to pay for it.

Another thing to keep in mind is that it’s rare that any of Cialdini’s weapons work alone.  As you’ll see, the Reciprocity principle employed by eHarmony also ties in with the next weapon we’ll examine: Commitment and Consistency!

I know you're out there. I can feel you now—corporate recruiters at career fairs, sending offer letters to work at banks and consulting firms.  I know that you're afraid.  Google is.  You're afraid of startups. You're afraid of change.  You’re afraid that students and young people are going to realize that you’re not the best place for them to learn, grow, or gain in responsibilities.  I don't know the future. I didn't come here to tell you how this is going to end. I came here to tell you how it's going to begin. I'm going to publish this post, and then I'm going to show these people what you don't want them to see. I'm going to show them a world … without you getting in the way of their amazing careers.  A world without rules and controls, without borders or boundaries; a world where anything is possible. Where we go from there is a choice I leave to them.

Students, there's something wrong with your career. You don't know what it is, but it's there, like a splinter in your mind, driving you mad. You are seeing a career set in motion before you but somehow your eyes are still closed—winding up in internships you don’t care much about, applying to grad schools because you can’t figure out what else to do.  If you don’t make a drastic change soon, you’re going to end up so hopelessly dependent on the system that that you will fight to protect it. 

Do you think the lawyers at the RIAA suing music fans weren’t teenagers at one time?

Free. Your.  Career.

It’s time you were shown the world *they* don't want you to see--the dream world that has been pulled over your eyes to hide you from the truth.

What truth?

That your career is a prisoner—in a prison that has been constructed in your mind to keep you contributing your energy into the system.  It's a prison that limits your ambition, clouds the path ahead of you so you don’t even know what jobs are out there, and keeps you in line with everyone else--mindlessly marching to careers in banking, law, consulting and accounting.  The prison walls are built with career fairs, campus job boards, and industry panels--all seemingly meant to help you but, in reality, sending you down a path that makes you just another battery in the system. 

You feel it when you print your resume, put on a suit, or sit down for a big company interview.

Open your eyes to the truth--the desert of the real if you will.  This bustling corporate landscape where you made your way up the ladder, learned a ton, and retired happy, rich and fulfilled ended years ago.  Now, these mindless corporate careers live in a world where the light of the sky has been blotted out, where the dead hopes and dreams of those before you are liquefied and fed shamelessly to new recruits, and control reigns supreme.

There is, however, hope.  There is a city deep underground in New York where people who have been freed from this prison gather--a Zion, if you will.  They work at small, innovative companies like Foursquare, Tumblr, Meetup, and GroupMe.  They are passionate about what they do, excited to come to work everyday, and just as excited to stay late surrounded by awesome people solving interesting problems.  As my friend once said, “I never hugged a co-worker until I worked at a startup.”

This city is the thriving New York startup community, and if you’re willing to unplug from the Matrix—the cattle driving process of big corporate recruiting—you can join in.  We’re fighting the good fight against the machines.

To enter this Zion, you need more than just code (although being able to code helps). 

You need to know kung fu… to be a ninja—to be the kind of worker that takes initiative, learns what they don’t know, goes the extra mile, and asks for forgiveness, not for permission.

Do you think that’s air you’re breathing? 

If you’re willing to wake up, unplug, and explore the idea that you don’t have to work for PWC or go to law school if you’re not ridiculously psyched about it, start now.  Show up for a startup event.  Join communities of innovators.  Start blogging about what you *are* excited about.  Don’t try to reverse engineer your resume to try and figure out who would hire you.  Follow awesome startup people on Twitter.  Put down the job listings and show up at the companies doing things you care about and find out what you can do for them that they can’t live without.  No kung fu skills?  Learn them!  You’re in school right?  Most of you have at least six to eight months before you graduate.  Pick up a ruby book and learn some code.  Take a sales training course.  Learn how to drive traffic to your blog using Google keywords. 

You don’t need an idea.  You don’t have to be a founder.  You don’t need to learn to code (but it does nearly guarantee employment).  You just have to be willing to reach out, build relationships, and make yourself useful.  Start participating and creating value.  Go make a list of 25 innovative companies you’d like to work at and have at it—reach out  on LinkedIn to founders, their investors, people who work at the companies.  Innovation is a ground war—house to house—and so should your career development.  Get out of your dorm rooms, off campus, and start showing up… or just be a battery for the machine.

I'm trying to free your career, but I can only show you the door. You're the one that has to walk through it.

You probably didn’t hear about Brooklyn Beta before Fred wrote about it:

“This is my kind of conference. There was one other VC in the room, Charlie O'Donnell, who makes it a practice to be everywhere something is interesting happening. The rest of the room was filled with designers, coders, and especially designers who code. That last group is a special breed and the heart and soul of many of our best companies.

It was a great group, in a cool space, talking about building web and mobile web services. I saw Kevin Cheng (@k) talk about product managing the creation of#newtwitter. I saw Marco Arment talk about building Instapaper on the side while he was CTO of our portfolio company Tumblr. And I saw a bunch of demos of beta services spliced in between the talks.”

You didn’t hear about it, that is, unless you followed some of the most innovative designers and developers in Brooklyn.  That’s kind of the point.  You see, the crowd here was part of the event—and while sure, there isn’t a single entrepreneur who wouldn’t like to hear about the birth of Instapaper or #newtwitter, if you actually put everyone in the room who would have wanted to be there, you’d have the New York Tech Meetup.  That’s kind of a different animal—a completely different vibe.  The diverse perspectives of the technical and creative class of NYC created a great experience for all who were lucky enough sit huddled close together in a chilly Brooklyn warehouse, nearly on top of the speakers.

While I’m a big advocate of open access, I think there’s something to be said for scarcity and hurdles to discoverability.  Anyone could have signed up for this conference, but since it spread through word of mouth from the most excellent organizers Cameron and Chris, you probably wouldn’t have found it in time if you weren’t in the designer and developer ecosystem.  With this kind of social self-preselection, the result is the kind of crowd you’re not going to get at startup events broadcasted far and wide. 

I hope next year’s event is the same size, with most of the same folks.  It doesn’t need to grow. 

The New York ecosystem needs these events for the most innovative practitioners just as much as it needs open, educational events for newbies.  These are the crowds, when brought together in a critical mass, push the envelope of awesomeness, creativity, and style, carrying the reputation of the whole community on their shoulders.  That’s going to get dulled if half the crowd is made up of idea people looking for technical co-founders or VCs who think every person they meet is only worth the number of deals they can source from them.  There are places for that, and this wasn’t it.

What the NYC innovation community needs is more smaller, targeted opportunities for like-minded, and similarly experienced locals can get very specific about solving their needs in an in-person collaborative setting.  There are tons of opportunities for taking the lead on these kinds of activities.  No one asked Cameron and Chris to put this all together—they just wanted to see it happen and they made it. 

So, before you complain about other people’s events not having the right mix of people, not enough capacity, or not covering what you want, realize that it is absolutely within your power to create the kind of community you want to live and work in.  It just needs some hard work, vision, and execution.

Wow…  So, where to begin?  This year’s @shakeshack event, nextNY’s third annual party in Madison Square Park, was undoubtedly the best ever.  There are so many people to thank and there’s so much to say about it.

First off, we had a fantastic crowd.  From regulars to newbies—to local goverment celebs like City Council Speaker Christine Quinn.  Taylor Davidson provided photos of many of the notables as our on-site photographer.

The event also marked the end of voting for the first nextNY Community awards, made possible by the generous sponsors of the event.  When the votes were in, here’s how things stood:

Top NYC tech recruiting firm Winter Wyman sponsored the award for Best Company Culture—citing the importance of understanding your own culture and maintaining a healthy environment as keys to hiring.  Betaworks took the to spot with 54.3% of the vote versus Foursquare’s 32.9%.  Buddy Media and Yelp had single digit returns.

The Most Valuable Angel had co-winners—tagteam Josh Stylman and Pete Hershberg beat out Chris Dixon, 44.2% to 28.8%.  Steven Messer brought in 15.4% of the vote, with David Rose and Jeff Stewart rounding out the top five.  NY Angels sponsored this award, continuing in its campaign to educate entrepreneurs on the importance of bringing on experienced investors.

The next category of companies really mailed it in if you ask me.  BuyWithMe edged out Scoop St. 48.8% to 32.3% for the Best E-mail Driven NYC Startup, sponsored by Experian Cheetahmail.

GroupMe blew out the competition for most Buzzworthy startup, gaining 63.1% of the vote.  This category was sponsored by Brew Media Relations, whose presence at the event was buzzworthy in its own right.  The girls from Brew set the tone by quickly getting everyone wristbanded and checked in to the event—efficiently and with a smile.  Thanks Brooke & company!

Bit.ly came from behind to overtake Hunch for Best Technology at a NYC Startup, winning with 47.3%.  Tech development shop Pivotal Labs made this award possible—as did the millions of shortened links managed by the pufferfish caretakers.

The largest gains in the polls came from the Cooley sponsored Entrepreneur of the Year award, where Dennis Crowely beat out Anthony Casalena from Squarespace, as well as Nat Turner and Zack Weinberg from Invite Media.

We had support from our other sponsors as well—RRE, Spark, and First Round Capital.  These firms believe in the “rising tide” theory that events like this need to happen in a thriving community and that such an ecosystem benefits them in more ways than just on the spot visability. 

There was also a giveaway—Winter Wyman gave away an iPad to the person at the party who tweeted the worst interview question they ever got.  That came from Jeremy Morgan.  Jeremy is deaf, and an interviewer once asked him "So do you Sign or read Braille?"  Ugh.

I can’t thank the staff at both the Shakeshack and the Madison Square Park Conservancy—without their efforts, I couldn’t put this event together.  They make the whole operation incredibly turnkey from my perspective.  Lizzie Honan and Leah Milton in particular are amazing to work with.

I think the best part of this event is the  fact that the doers actually make it out for at least this one night out of the year.  It’s not hard to find the Assistant Social Media Director of some agency or the junior analyst/intern at some investment firm at a party, but the people that actually make this community work—the real innovators and most accomplished folks, make it a point to carve a spot for this in their schedule.  These are also the folks that never run into each other, because they’re so heads down in building their own businesses. 

My hope is that it became very apparent to Speaker Quinn that we have an incredibly thriving community here—full of success stories that she should be telling wherever she goes.  I introduced her to Dennis Crowely, Andy Weissman, and Anthony Casalena among others. 

I hope last Wednesday’s night in the park—the only night it didn’t actually rain in NYC, was as fun for me as it was for our 300 attendees.  You can thank Howard Morgan and his long range weather forecast subscription for picking the right day, because it gave me an accurate weather prediction two months out.