Analyze success of existing Unicorn Companies Innovation: How to Create a Unicorn Company Mindset Enabling Technologies Unicorn business opportunities for China

1. Zhejiang Strategic Outlook
Hangzhou, June 7, 2018
Slides: http://slideshare.net/LaBlogga
How to Create A Unicorn Company
Worth 6.4bn yuan ($1bn)
Melanie Swan
Philosophy, Purdue University
melanie@BlockchainStudies.org
下午好

2. 7 Jun 2018
Blockchain 1
Melanie Swan, Technology Theorist
 Founder, Institute for Blockchain Studies
 Philosophy Department, Purdue University,
Indiana, USA
 Singularity University Instructor; Institute for Ethics and
Emerging Technology Affiliate Scholar; EDGE invited
contributor; FQXi Advisor
Traditional Markets Background
Economics and Financial
Theory Leadership
New Economies research group
Source: http://www.melanieswan.com, http://blockchainstudies.org
https://www.facebook.com/groups/NewEconomies

3. 7 Jun 2018
Blockchain
My Startups
2
Casbah Couture
The California
Crepe Company
GroupPurchase
DIYgenomics DIYelectronics DIYneuroscience
Deep Qualia
Institute for
Blockchain Studies

4. 7 Jun 2018
Blockchain
Agenda
 Analyze success of existing Unicorn Companies
 Innovation: How to Create a Unicorn Company
 Mindset
 Enabling Technologies
 Unicorn business opportunities for China
3

5. 7 Jun 2018
Blockchain 4
What is a Unicorn Company?
 Private
company
 Valuation
 6.4bn yuan
($1bn)
Source: https://en.wikipedia.org/wiki/List_of_unicorn_startup_companies

6. 7 Jun 2018
Blockchain 5
Mobile Payments and eCommerce
 Cashless consumer society of
the future
 China 50x US mobile payments
(6x population)
 China $5.5 trillion vs. $112 billion
US (2016)
 China success factors
 Mobile payments trusted (55%
China 19% US)
 Targeted advertising (31% click-
throughs China vs. 16% globally)
 Leapfrog technology: rural markets
cash-mobile payments
Source: Swan, M. 2017. Technology Innovation Management Review. 7(10): 6-13. http://timreview.ca/article/1109

7. 7 Jun 2018
Blockchain
PWC: eCommerce growth trends in China
6
Source: https://www.pwccn.com/en/retail-and-consumer/publications/total-retail-2017-china/total-retail-survey-2017-china-cut.pdf

8. 7 Jun 2018
Blockchain 7
Platform Economies
 Leverage network effects
 Uber, Didi
 World's largest taxi companies, own no vehicles
 Airbnb
 World's largest accommodation company, owns no real
estate

9. 7 Jun 2018
Blockchain 8
Unicorns are Platform Companies
 7 of top 10 do not produce physical assets
 Digital service models
Payments
Ride-share
Ride-share
Electronics
Batteries
Software
Books
Hardware
Home-share
eCommerce
Source: https://en.wikipedia.org/wiki/List_of_unicorn_startup_companies

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Blockchain 9
Forbes top 10 Innovative Companies 2018
Source: https://www.forbes.com/innovative-companies/#63f6f4921d65, https://www.recode.net/2018/4/9/17204004/amazon-
research-development-rd
 ServiceNow, Workday, Salesforce: digital transformation
 Tesla, Naver, Netflix: disruptive business models
 Amazon: $23 billion spend on R&D 2017

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Blockchain
Network Effects: Metcalfe’s Law
 The value of a network is
proportional to the square of the
number of connected users (n2)
 Two telephones: one connection
 Five: 10 connections
 Twelve: 66 connections
 Critical mass threshold
 Value > cost adding a new user
10

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Blockchain
infrastructure.
11
Source: https://www.chinamoneynetwork.com/2017/04/27/chinas-fixed-line-broadband-penetration-rate-to-hit-63-this-year
 Fixed wireline broadband penetration and
download speeds

13. 7 Jun 2018
Blockchain 12
Platform Economies trend
Closed Platforms App Stores Open Platforms
Netflix
Instagram
Facebook
Snapchat
Apple
Android
Windows
Open Source Software:
Linux, GNU, Apache
Blockchain Projects:
Ethereum
One-way network
effects (monopoly
properties)
Partial two-way
network effects
(revenue-sharing)
Two-way network
effects
(participation
remunerated)
Closed Open

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Blockchain
Closed platforms: growth saturation
13
Source: hhttps://techcrunch.com/2018/01/31/facebook-q4-2017-earnings/

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Blockchain
participation.
14
information
internet: static
information
social internet:
engage with
content
crypto internet:
participate in the
community economy

16. 7 Jun 2018
Blockchain
Agenda
 Analyze success of existing Unicorn Companies
 Innovation: How to Create a Unicorn Company
 Mindset
 Enabling Technologies
 Unicorn business opportunities for China
15

17. 7 Jun 2018
Blockchain
mindset.
16

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Blockchain 17
better horse and car.
new technology.
better horse “horseless carriage” => car

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Blockchain 18
 Dilemma: successful
companies become
complacent and do not
invest in disruptive
technologies
 Low-risk innovation:
create a solution where
no existing solution exists
innovation.

20. 7 Jun 2018
Blockchain 19
1. Name
2. Market
3. Problem
4. Solution
5. Competition
30-second Elevator Pitch
Source: https://www.fool.com/investing/2018/01/28/meet-chinas-top-3-streaming-video-platforms.aspx
1. AliVid
2. Total Addressable Market (TAM):
• 22 billion yuan ($3.5 billion) 2015 to
96.2 billion ($15.2 billion) yuan by 2020
3. Problem: lightweight mobile on-
demand streaming video service
4. Solution: smart app video download
5. Competition: Tencent Video, iQiyi
(Baidu), Youku Tudou (Alibaba)

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Blockchain
think in possibility.
see the world as it could be, not how it is.
20
Actuality Possibility

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Blockchain
who are your role
models?
21
Elon Musk Peng Lei Jack MaCraig Venter

23. 7 Jun 2018
Blockchain
creativity.
22
Geniuses: Einstein, Edison, daVinci, Darwin, Picasso,
Michelangelo, Galileo, Freud, Mozart
Source: http://time.com/2907776/strokes-of-genius-heres-how-the-most-creative-people-get-their-ideas/
 No one Eureka moment
of fully-formed ideas
 Iteration of ideas,
prototypes, solutions
 Lots of sketches of
thoughts, pictures,
diagrams, words

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Blockchain
ideas notebook.
23
Newton’s drawingsAlice: 6 impossible things
before breakfast

25. 7 Jun 2018
Blockchain
lean business model
canvas.
24
 9/10 businesses fail
 Not because they did
not deliver a product
 Because they delivered
a product that no one
wanted

26. 7 Jun 2018
Blockchain
lean business model
canvas.
25
Source: http://howtowriteabusinessplan.com/2018/02/lean-startup-canvas-the-starting-point/
 Most important: talk to many real customers
about real problems

27. 7 Jun 2018
Blockchain
mission.
26
 Organizations driven by purpose and values
outperform the market 15 to 1
Source: http://bizshifts-trends.com/power-purpose-driven-business-leadership-management-focus-mission-vision-reason-exist-really-
matters/

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timing.
27
 A clear view is not a short distance
 Too early is failure

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Blockchain
enabling technologies.
28

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Blockchain
infrastructure.
29
Source: https://www.chinamoneynetwork.com/2017/04/27/chinas-fixed-line-broadband-penetration-rate-to-hit-63-this-year
https://doi.ieeecomputersociety.org/10.1109/MIC.2006.67
 Fixed wireline
broadband penetration
and download speeds
 Backplane

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Blockchain
semiconductors.
30
Source: SIA: Semiconductor Industry Association 2017 Factbook, May 2017
 Next-gen applications facilitated by downstream
technological advance

32. 7 Jun 2018
Blockchain
molecular computation
interface.
31
Source: http://futurememes.blogspot.com/2009/05/opportunities-in-level-two-nanoscience.html
Structural DNA:
Holliday junction
Rotaxane Molecular
Propeller
 Top-down solutions
 EUV and block copolymer lithography
 CNT transistors
 Memristor
 Quantum-dot cellular automata
 Plasmonic materials & spintronics
 Quilt packaging & 3D stacking
 Bottom-up solutions
 DNA self-assembly
 DNA computing
 DNA-based transistors
 3D DNA nanocrystals
 Molecular memory

33. 7 Jun 2018
Blockchain
technology transfer.
32

34. 7 Jun 2018
Blockchain
Agenda
 Analyze success of existing Unicorn Companies
 Innovation: How to Create a Unicorn Company
 Mindset
 Enabling Technologies
 Unicorn business opportunities for China
33

35. 7 Jun 2018
Blockchain 34
Unicorn Business Opportunities
 Extend consumer success into
the enterprise domain
 Cashless economy of the future
 Apply consumer mobile payments
business models, infrastructure,
and success to corporate and
trade payments market
 Streamlined trade finance,
collateralization, remittance,
invoice processing, purchase
orders

36. 7 Jun 2018
Blockchain 35
 Consumer Services
 eCommerce, mobile payments,
entertainment, job skill development
 Personal data security services
 Enterprise Services
 Cloud services, cybersecurity
 eCommerce, corporate payments,
supply chain, manufacturing
 Connected Car
 Vehicle gateway, 3D modeling
 IoT Smart Home, Smart City
 Smart transportation
Unicorn Business Opportunities

37. 7 Jun 2018
Blockchain 36
Unicorn Business Opportunities
 Beyond internet-based commerce, value-added services
 Unique value-add requires technical innovation
Source: https://www.reuters.com/article/us-sensetime-funding/chinas-sensetime-raises-620-million-its-second-funding-round-in-two-
months-idUSKCN1IW07I
SenseTime
facial
recognition
software (AI)

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Blockchain
China Exports: 16.91 trillion yuan
37
Source: https://atlas.media.mit.edu/en/profile/country/chn/
Destinations

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Blockchain
China Imports: 10.89 trillion yuan
38
Source: https://atlas.media.mit.edu/en/profile/country/chn/
Origins

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Blockchain 39
Digital Economy Unicorn Opportunities
 Productivity gains
 Capital investment in technology
 Cloud computing data centers
 Blockchain as a Service, Deep Learning nets
 Skilled work force development
 Train 1000 software developers
 Hyperledger, Ethereum, Corda
 Machine Learning, AI, Deep Learning
 Scale efficiencies
 Natural resources, regional strength, large companies
 Manage global trade supply chain with
blockchain/deep learning

41. Melanie Swan
Philosophy, Purdue University
melanie@BlockchainStudies.org
謝謝
Zhejiang Strategic Outlook
Hangzhou, June 7, 2018
Slides: http://slideshare.net/LaBlogga
How to Create A Unicorn Company
Worth 6.4bn yuan ($1bn)