Silicon Valley

Jerk Tech?

The world is full of Jerks.

You know who I’m talking about – that person who snatches the parking spot you’ve clearly been signalling for, that man who cuts the line in the coffee shop, or that woman who steals your reservation at the restaurant. We’ve all met them. Sometimes we have probably been guilty of being them.

What happens when those behaviours and attitudes that define us ‘oh-so-fondly’ as being jerks make the jump to the digital world?

Well, then, you have Jerktech.

Jerk Tech

 

What is Jerk Tech?

Jerk Tech refers to Apps that essentially exploit loopholes for a fee. These loopholes are usually found in small businesses and public infrastructure that are not owned or controlled by the person who created the App.

In other words, these Apps sell something that would otherwise be free.

Josh Constine, a writer at the popular blog Tech Crunch coined the term recently.

 “Go disr*pt yourself” is what I have to say to founders of startups like ReservationHop and Parking Monkey — Josh Constine, Tech Crunch

The key point about Jerk Tech, is that they take a fee for publicly available resources and charge people for the privilege of using them.

These publicly available resources can include everything from public parking spaces to reservations at restaurants.

The actual provider of the resource (whether it’s a city Councillor who created the parking spots, or a restaurant owner who is trying to survive) don’t get any benefit at all.

Examples of Jerk Tech

A lot of Jerk Tech revolves around the concept of Peer-to-Peer commerce.

Dropbox is an example of Peer-to-Peer commerce. Two individuals use the service (and can pay for it if necessary) to share large files. Dropbox acts as a middleman of sorts, and it is completely legal.

The problem lies in that many of these peer to peer applications fall into a legal grey area. Now governments around the world are scrambling to figure out how to regulate them.

There is a growing backlash against some of these companies. Many are saying they are pushing the boundaries of what makes an acceptable or honest commercial enterprise.

Reservation Hop

Reservation Hop is one example of a Peer to Peer application that many are calling Jerk Tech.

It’s a way to get into a trendy and popular restaurant that has been booked solid for months quickly. However, there is a catch.

Reservation Hop is being called Jerk Tech because the company is trying to make money from something that’s essentially free: making a dinner reservation

Even the company’s founder wrote that he’s the most hated person in San Francisco. He continues to defend his App though.

We book up restaurant reservations in advance. We only book prime-time restaurant reservations at the hottest local establishments, and we mostly list high-demand restaurants that are booked up on other platforms — Reservation Hop

Monkey Parking

Monkey Parking single-handedly created parking rage in San Francisco.

How is it doing this? Well, by selling parking spots to the highest bidder.

Monkey Parking drew the attention and anger of San Francisco’s district attorney Dennis Herrera in June. Herrera sent a letter to the startup, saying its app — which allows people leaving a public parking space to auction it off to nearby drivers — is illegal in San Francisco.

San Francisco went as far as to ban the use of the MonkeyParking app in late June, declaring that it would not allow the creation of a “predatory private market for public parking spaces”.

City authorities sent a “cease and desist” letter to MonkeyParking and threatened fines of $2,500  per violation of the order. It gave the company until 11 July to stop operating in the city.

Initially resistant, the Monkey Parking has temporary shut down services while it clarifies how it can legally operate.

Are all Peer to Peer Commercial Apps Jerk Tech?

Ah, therein lies the rub! Monkey Parking and Reservation Hop are the far end of the spectrum – the worst of the worst of the Jerks, so to speak.

But Jerkdom isn’t black and white. Think of it like a sliding scale, with some companies just pushing the boundaries of what’s acceptable, while others are jumping right over the barriers.

Where exactly those barriers are isn’t exactly clear yet.

Uber

Very few Peer-to-Peer commercial Apps are more hotly debated than Uber


Since launching in San Francisco four years ago, Uber has expanded into 149 cities in 41 countries, with an app that enables users to hail a taxi with a tap of a smartphone.

The company’s latest push has been into Asia: since launching in Seoul last August, it has entered other cities including Beijing, Singapore, Bangalore and Hong Kong.

While users have embraced the convenience offered by Uber, taxi drivers are up in arms against the threat to their livelihoods. In June, taxi drivers in Berlin, Paris, London and Madrid staged a co-ordinated strike in protest against the app and a Belgian court declared Uber illegal in April.

In spite of this, investors have shown keen interest in Uber, making it one of the most valuable start-ups of recent years. In June it raised $1.2bn in new capital on terms that valued it at $18bn.

Seoul’s government has gone as far as to launch legal efforts to ban Uber in the country

“Uber is hurting the good people of the taxi industry,” said Kim Kyung-ho, head of the Seoul city transport department.

AirBNB

Sick of paying expensive fees for Hotels? There’s an App for that!

 

There are roughly 15,000 AirBNB “hosts” in New York and, according to the courts or the tabloids, they are scammers, pimps and updated versions of slumlords.

AirBNB itself admits there are bad apples in the system,  but the startup estimates that 87% of listings are in good faith. Other statistics suggest that professional landlords abusing the system are responsible for as many as 30% of all listings.

This App goes against a law that came into effect May of 2011 that says it’s illegal to rent full apartments for less than 30 days.

With AirBNB,  a studio apartment on a vacation rental site can go for $175 or so a night, bringing in much more than the monthly income from someone with a standard year-long lease. Plus, the hosts could basically operate like a hotel, but without all the pesky safety regulations, insurance requirements, permits, or zoning that real businesses have to deal with. Or good neighbors for that matter.

On the other hand, it can operate as a cheaper alternative to people who want to travel but can’t afford traditional accommodation.

Right now AirBNB is still functioning, but whether a few bad apples will push this App into the “Jerk Tech” category remains to be seen.

So, whether  your are a start up or an individual, try to remember your behaviours have an impact on people around you.

Don’t be a Jerk.

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Silicon Savannah

Africa is on the verge of a great revolution.

Not political or social, but there is little doubt that the repercussions from what is changing will shake the foundations of the very continent.

Welcome to the rise of Silicon Savannah

Silicon?

The nickname of ‘Silicon’ originally referred to the region’s large number of silicon chip innovators and manufacturers, but is now generally used as a reference for the American high-technology sector.

Today, the term refers to the heart of innovation on the West coast of America.

Thousands of high technology companies are found and head quartered in Silicon Valley. Many of those are part of the Fortune 1000:

  • Adobe Systems
  • Apple Inc
  • eBay
  • Facebook
  • Google
  • Pixar
  • Netflix
  • Yahoo!

It is a hotbed of innovation.

Want Google Glass? It was developed in Silicon Valley. The latest iPhone? Silicon Valley. The unlikely hit app YO? You got it; it came from Silicon Valley.

So what does this have to with the Silicon Savannah?

Silicon Valley Losing its Lustre?

Before we go to Africa, let’s look at some of the hidden numbers that make up Silicon Valley.

  1. Between 1995 and 2005, more than a half of all Silicon Valley tech companies were founded by Immigrants. But in 2012, that had dropped by a sixth. According to the 2012 Open For Business study, immigrants are twice as likely to start a business as native born Americans – so why is that number declining in Silicon Valley instead of increasing?
  2. American Federal funding for advanced computer science and electrical engineering research has dropped sharply since the late 1990s
  3. Many advances in computing are starting to come from outside of the US. In 2007, only seven American firms ranked among the top 25 US patent recipients.
  4. China and India each now graduate more engineers and scientists per year than the US.
  5. The US share of patents issued has fallen below 50%
  6. Net Neutrality may be coming to an end in America. Which means that Start-Up companies may not be able to afford starting up. Investors will be less willing to fund a startup,  since they don’t know how expensive it’s going to be to have to pay off the big broadband provider

The ongoing connectivity of the world has allowed for the greatest minds of the world to find outlets for their innovations in areas that are not Silicon Valley USA.  This means it is no longer a must  to immigrate to the USA or Canada if you want to see your innovation come to fruition, you can find outlets in other parts of the world such as Silicon Savannah.  Incidentally this is all happening while the Net Neutrality debate continues to heat up.  The end of net neutrality might make it cheaper for startups to launch from other countries where they don’t have to pay premiums for fast lane internet.

(We wrote an article on what Net Neutrality is earlier this year – you can read that article HERE)

With all of these new barriers cropping up, it should come as no Surprise that Silicon Valley may be starting to stagnate.

From a Valley to a Savannah?

Seven of the world’s 10 fastest growing economies are now located in Africa.

  • Ethopia which is growing ten times faster than the U.K.
  • Mozambique which has achieved an average of 7.2% growth during the last decade
  • Tanzania
  • Congo 
  • Ghana which is rivalling China in growth speed
  • Zambia 
  • Nigeria 

The importance of Africa cannot be overstated. Now, although Silicon Savannah refers specifically to Konza, located in Kenya, it can be broadened to refer to Africa as a whole.

Africa is a continent without the most reliable of Internet. So how are they able to maintain this rapid economic growth? Of course there are the natural resources to consider, but the main technological draw is their emphasis on mobile technology.

The continent has some 650 million mobile phone users — more than the United States or Europe — who account for a direct economic impact of $32 billion.

This focus on mobile isn’t just changing Africa, it’s changing the world.

What also sets African innovation apart is a core understanding that technology must work for residents in both bustling modern cities, such as Cairo or Cape Town, and the rural areas that are still home to half the world’s population.

Techies hunched over laptops in small offices across Africa want to create their own versions of California’s Silicon Valley and some are beginning to attract investors prepared to take a risk in the hope of high returns.

Technological Innovations from Silicon Savannah

m-Pedigree

In Ghana, for example, a mobile app by social enterprise m-Pedigree verifies whether medicines are genuine.

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Fake medicine is a scourge in Africa and people often have no way of telling whether they are buying the real thing or not.

BRCK

Known as the BRCK, the router will cost just under $200 and charge off car batteries, solar panels or main electricity.

Its battery can run for at least eight hours, essential in a region with frequent power outages.

Internet usage is still patchy with only about one in five Africans having access to it, as many are restricted by lack of electricity, broadband or devices.

Ushahidi

When things turned ugly after Kenya’s 2007 elections, an unlikely group of heroes — young African coders — developed a platform that used cellphones and the Internet to track the violence. Ushahidi, as it was called, would go on to transform not only government accountability in Nairobi but, more broadly, digital mapping around the world

Ushahidi has been used to find survivors of the 2010 earthquake in Haiti, to track the impact of the BP oil spill, and for outlets like The Huffington Post and Al Jazeera to gather news otherwise unreported.

iCow

iCow

iCow is an SMS (text message) and voice-based mobile phone application for small-scale dairy farmers in Kenya.

Setbacks

The continued challenges of connecting a continent as big as Africa continue to be a driving force in technological innovation.

Of course, once BRCK becomes widely accessable and used, that might change. For now, however, Internet access can be spotty at best.

Another problem? The ideas may come from Africa, but the actual product is for the most part being developed in America. That rule also applies to BRCK.

“Can we truly add that silicon name into Silicon Savannah. We don’t have hi-tech manufacturing here yet. But we are starting to,” said Juliana Rotich, one of the creators of BRCK.

 

Investment 

It isn’t just Africans who are interested in the rise of the Silicon Savannah. Outside companies are looking to invest huge amounts of money to help make the Savannah a hotbed of innovation.

 

Savannah Fund

Savannah Fund has made its first move into South Africa, buying into two Cape Town-based start-ups.

The fund, which already has investments in East Africa and West Africa, has invested in e-commerce site BabyGroup, an online shop and information service for new parents, and Wyzetalk, a social business platform developer.

Tax Exempt

Businesses investing in Kenya’s multi-billion dollar technology city are being promised tax exemption for up to ten years in a bid to attract more investors.

This is according to proposals outlined in the ‘Konza Technopolis Development Authority Bill 2014’, which recommends that all businesses operating within the $10 billion Silicon Savannah project be exempt from paying 30% income tax and 16% value added tax (VAT) for the first ten years.

The next time you come across a really cool technological innovation, take a second to find out where it came from it might be just another Silicon Valley product, or it might have come from across the world in Silicon Savannah.