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Tablets for education.

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After Apple launched iPad and the Samsungs who copied it, things haven’t been the same again. The personal computer market has been redefined; sort of re-invented. However, these waves of gadgety-excellence broke long before they reached the Indian shores.  Or have they? After HCL launched ME U1, now Micromax has brought to market an Android 4.0 ICS based 7-inch tablet acknowledging the presence of a large market in India – the school goers! The Indian middle-class family having recently bought a laptop is still wondering whether they need a tablet, if at all they are considering buying one. Turns out these tablets are really not meant for them, but for their kids.

Normally, a personal computer means a personal computer! Something you buy for yourself. But the Micromax Funtab – that’s what they’re calling it, you buy it for your CBSE-school going child. For an additional price of 800 bucks, you get a 4GB memory card pre-loaded with interactive course material meant for CBSE students just like you’d get in “HCL My Edu Tab K12” and “HCL My Edu Tab HE”. Along with the school tuition fees, so long you have been paying additional charges for interactive classroom-boards, audio-visual content etc. that the school used to teach your children. But then again were they interactive enough or personal?

Funtab has a price tag of Rs. 6499/- which is about Rs 1500 cheaper than the recently launch HCL ME U1 tab. It has a slightly faster processor- 1.2 GHz and twice in RAM memory- 1GB.  While a Funtab user can get access to the 600 movies, 6000 songs and 400 Video clips and the latest games, apps and TV shows, HCL boasts of a 10,000-app strong ME app store. Only if the comparison were that simple!

HCL has a large presence in the school-education market. Apart from IT services, they’re also in the business of selling smart-boards, projectors, school ERP and customised educational content to the schools. They’re giving a fierce competition to the likes of Tata Interactive Systems, Educomp and NIIT who are also in the similar business. If you’re buying it for your child then why not buy it from the ones who are experienced in education? Although, it is hard to believe that the HCL would have this advantage over Micromax or other competitors in the long run.

Just like developers helped Apple grow like it has, Indian developers, especially the ones who are building interactive courseware or other educational apps is going to play a huge role in the personal-computing-in-education industry. The content that is played on the smart boards would now be played in your child’s hands. It will be more interactive and more fun. So, Micromax need not really worry about developing educational content. If encouraged, the developers will jump right into this opportunity.

Overall, it is good news for the parents who can’t afford iPads or Playbooks for their children. Now, they have a few options to choose from because until now the tablet market has been like an automobile industry with only BMWs (iPads) and Tata Nano (Akash Tablet) to offer! That didn’t work.

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Newspapers’ gonna be an extinct species. Really.

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From the movie, Charlie Wilson’s War

Charlie Wilson: Let’s see what’s on the wires.

Charlie Wilson’s secretary: Why can’t you wait for newspapers like everybody else?

Charlie Wilson: ‘Cause I think it’s productive to know today’s news today. And it makes me one day smarter than you, which I enjoy as well.

This blog just started as a tweet I posted this morning, “The primary problem with newspapers is that they are ridiculously late.”

I sleep at around 12 am and wake up by 4 am. The newspapers get delivered to my door at around 7 am. The reason I am no longer a great fan of newspapers is that I would have already read most of the news, the ones that I would read anyways, hours before, sometime even days before the newspapers reach me. This has made me think deeply about whether I should continue to subscribe newspapers or not. I agree that it is too early to say “No”. But are we far from that day where there would be no newspapers, at least in some circles? I guess not.

The reasons why I think it will happen soon are quite well known:

1)      Tablet & Smartphone proliferation.

2)      Falling costs of wireless and broadband connections.

But a few things need to change first.

The core competency of news companies is content. Additionally they have to take care of the distribution and sales of advertisement space. This is going to change, news companies of the future will only have to worry about producing great content. So, how is this transition going to take place? This is how I think, it will play out eventually:

1)      Paper: Your phone/iPad is the new paper.

2)      Distribution: Facebook is the new news delivery van and instead of one newspaper delivery boy you’re going to have many- your Facebook friends.

3)      Advertisements: Needless to say that the advertisements that are going to be delivered on your screen is going to be highly contextual and targeted based on your  interests, e-mails you exchange and the searches you make on Google, Siri. News companies need not bother about selling ad spaces. Instead, they will work with ad networks like Facebook, Google AdSense, iAds, InMobi etc.

4)      App Developer: This is where the big opportunity lies for a new kind of industry to develop. Right now, the news companies are developing their own applications for iOS/Android, which kind of gives me a feeling of, “Na..aah!!”. Why? Because I love Flipboard. I want a similar kind of experience that is consistent with all news I read online from whatever source be it.

So what is this new kind of company going to do? I guess this what they will do:

a)      Build Flipboard like interface for the end user.

b)      Build easy publishing tools for the news companies.

c)       Analytics for the news companies.

d)      Integration with Facebook Social App.

e)      Integration with ad networks.

f)       Integration with payment gateways etc.

Most likely, this new kind of industry will be of enterprise product companies. They will build a huge part of the application that is going to be used by consumers just as e-banking or mobile banking applications built by enterprise software companies are used by the customers of the bank. When will this happen? It’s hard to predict, but I hope soon. I really don’t want to be one day stupider than Charlie Wilson, if he were alive!

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Vivek Wadhwa is right, don’t follow Silicon Valley, innovate for India.

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Speaking at the NASSCOM Product Conclave 2011, Vivek Wadhwa’s message to Indian entrepreneurs was simple: Silicon Valley’s model has holes. So, stop following them, stop making silly social networking applications and innovate for India.

My first reaction was, “What is he talking? Vinod Khosla has got off the stage not even a couple of minutes back. Vinod predicted that India is going to produce a plethora of billion-dollar-global product companies and also that social is still the next big thing. How could he know more than Vinod?”

There were many who were getting uncomfortable of his speech because Silicon Valley has been an inspiration for most of us. Many of them are building social apps. And they are in for the same kind of success and fame that is found in Silicon Valley. Wadhwa’s speech was even worse for me because I was to pitch him about my social media venture later. And there he was on the podium questioning the pillars of everything my start up and many other start ups stand for. Yet, I was interested in his speech because there was a germ of a feeling inside me that he may be right. A few days later I was convinced that he was.

As I spent the next few days thinking deeply about what he said I remembered an argument that once I had with a relative on the Singur trouble. I had argued that neither Mamata Banerjee nor the West Bengal Govt. was right. My argument was that it is utterly stupid to give up fertile land to industrialisation when a state has non-arable land. A few years later more people would agree with me since India’s agro production in 2010-11 was 2% less than the previous year – one of the contributing factors in the inflation in food prices that we faced.

If the government had anticipated that there was going to be a sudden boom in FDI in manufacturing and other sectors, it would have been wise on the part of the government to have the infrastructure built in non-arable locations. The income levels of persons dependent on agriculture in West Bengal is low and is likely to get worse with the increase in population dependent on the same quantum of land. Robbing farmers of little of fertile land they have make the farmers poorer. And if you thought it won’t affect you, if you thought it’s a reason for you to celebrate a rising India, who are you kidding? You are the one who will pay for such mistakes when the food prices go up. Growth, if not inclusive is a trouble. Wouldn’t it have been great if Tata Nano factory could be built in a piece of non arable land that West Bengal has in tens of thousands of hectares and the Singur farmers could be the first ones to buy those cute looking colourful Nanos?

There is a great lesson to be learnt from what happened in Nandigram. If USA is ahead of India, then you can’t reach where USA is unless you have traversed the path USA has to reach where it is now. So you can’t build silicon-valley-build-user base-first-monetize-later start-ups in India, unless the e-commerce eco-system is healthy and earning profits for the latter would buy your ad space. You need a ‘Pay for Online Services’ culture should you opt for a freemium business model for which you need a strong Indian user base online who have the money to splurge. India won’t have a healthy population that is adequately financially strong unless there is good and affordable education. Unless there is a healthy population that is financially strong not many would buy 4G/3G services? If no one buys 4G/3G services or fast broadband connections, there won’t be a strong communication infrastructure. If the communication infrastructure is not healthy and Indians don’t have money, how will anyone buy iPhones and why would Apple sell them? If you don’t have iPhones how will you build the next Instagram?

Hence I agree with Wadhwa’s point. We will build Instagrams, but not now. Right now, our priorities are different. Our challenges are different from the ones faced in Silicon Valley. Hence, the innovations also need to be in a different direction. Like how do we eradicate child labour completely so that we can get our children into the school programs? How do we make electricity cheaper and bring it to every home in India? How do we make more people start businesses in rural areas, so that the rural economy gets vibrant?

We need a special education system in India for the rural areas- ones that ensure placements into nice paying jobs. The challenge is to build these special programs that can create a strong skilled workforce. A combination of skilled workforce and infrastructure is surely going to get the manufacturing industries set up facilities in the remotest areas of India if well connected by roads. This is how you are going to productively use the whole vastness of the land and human resources India has. Folks say that India is a 1 billion strong market. Well it is sure not, not yet. Not until 1 billion of India’s people are educated and well empowered. Once they are, you will have your Silicon Valley. Not one, but many. Yes, within India.

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Future of social media and virtual policing- the next billion dollar industry.

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I was at the NASSCOM Product Conclave 2011 where Mr. Vinod Khosla said that he thinks that social media is only in its infancy. I agree with him. If you think that Facebook or Twitter is only about sharing what you ate at a restaurant or share photos that you clicked on your holiday, you’re seeing it the wrong way. You may not find a reason compelling enough to use social media if you’re not using it now. But technology has always been about where the puck is headed. Social media which forms the social structure on the internet is incrementally becoming the most important ingredient of the 21st century. To say that social media is silly would be as stupid as to say that human beings are unsocial.

We’re forming a parallel world on the internet which will define our lives. Our education, bread and butter, health and almost everything that is important to us will depend on the social structure that is being currently formed on the internet. I met a startup at the NASSCOM event that is building a trading platform for the brokers. The platform shall soon have a real time investment graph showing you the stocks that are being bought or sold by the people you trust. As information is being curated now on Facebook, Twitter and Google+ they will help you curate investments so that you can make the best investment decisions. Dear lord! The whole economy’s backbone will rest on the social structure in a parallel world-internet. This will happen to education too. Children of tomorrow can sit at home and choose any classroom in the world and study with his friends as we did in school. But this is only the adolescence of social media.

This is how I think the adulthood would be. In the past decade the three biggest online platforms- Google, Facebook and Twitter have devoted all their energy on opening the flow of information. The craze and obsessiveness with information exists because information helps people make decisions. And when people make decisions there is usually tremendous flow of money, hence this is a high value business. In my view, information won’t be the strongest enabler in helping people with decisions in the future. We’ve already reached an optimum level of information spoon-feeding. People of tomorrow will make decisions based on social perception. And I mean that in a big way. Imagine you are not sure who you want to vote. A social perception engine will be something like Google, where you search,” “Who to vote?” and the search result will serve you up with the most popular views of the society presented to you in a single short video. You need not spend hours searching blogs to get an idea what people you trust are talking about. We may think that information is powerful, it is, but we make decisions based on our personal judgement that is formed by the social perception.

We’re going to only have our mortal in the real world but the self and the intellect will reside in the virtual world. With such tremendous power comes tremendous responsibility for the technology world of the future. As, we need law enforcement system in the real world we are going to need a law enforcement system that is multiple times stronger than the previous one  in the virtual world because the communities are going to be so preposterously entwined that any violation of law can cause unimaginable and catastrophic  disasters for civilians, governments or private business. We’ve seen how social media caused a revolution in the middle-east. This was a positive outcome. But how do we make sure that this power won’t be misused?

Building an automated law enforcement system to ensure malicious intent does not destroy the purity of the virtual world is going to be the one of the hardest challenges of the mankind in the 21st century because of the following reasons:

a)      Human being converse in natural language. Hence, the system has to be capable to understand natural language.

b)      The system has to be self-learning so that it can detect patterns. Hence it has to be artificially intelligent.

c)       Who is going to build this law enforcement infrastructure and who is going to own it?

These are very difficult questions to answer. Technologically it does not seem to be impossible to me. Siri is one of the living examples of how a computer can be taught to understand natural language and recognize patterns. The bigger challenges are- who is going to build such a system and who is going to own it? My imagination is only limited, I can’t answer this question. Perhaps a start-up coming out of garage would be a nice beginning and eventually when it becomes successful the governments of the worlds will rely on its platform. Or perhaps it is going to be an open source platform where the likes of Facebook and Google will work together for their own benefits to provide an abuse-free service to their consumer. Only time can answer this question.

Summarizing, I’d like to say that social media is perhaps the most important invention of the 21st century. Those who think social media to be silly are going to make a u-turn or become irrelevant. Since, it is going to become a basic infrastructure of tomorrow’s economy, it is important that we protect social media with utmost care. Otherwise we may lose more than we can afford. Yes, it is incredibly challenging to solve this problem but there are positive signs and technologies available that can help solve this problem. This is the one of the next multi-billion dollar industries.

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We got funded, almost. This is why..

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I don’t see myself as much of an entrepreneur at the moment since by definition an entrepreneur is a person who sets up a business or businesses, taking on financial risks in the hope of profit. I’m not one of those. Not now. I’m just a guy. One who is building a product with a close friend which will hopefully see the daylight soon. About the only risk I have taken is to quit my previous business of selling enterprise software products to do what I’m doing now. Yes, I have been an entrepreneur in the past- a fairly unsuccessful one. I have worked for a start-up for nearly 3 years before that. So, I have some experiences to share. In this blog I will stick to how to approach investors.

I approached investors to raise funds twice in my life. I was rejected once. And in the other time, we did not eventually take the money. But that’s another story. The first guys I approached are not professional investors. They are a non-it services company- a pretty prestigious one, the biggest in their industry. Serving almost 75% of the industry. We’d done a software product prototype for the same industry that they operate in. We’re looking for investors who had profound domain expertise about the industry, since we were little on the weaker side on that. We got one in them. They could have been our strategic partners, they were fit for the job as they were already buying software products and services to provide managed services to their clients. They understood the software business well and the pain associated with it. Both for the customer and the vendor. After tens of hours of meetings, multiple product demos and test runs on one of their clients, we got them. They were ready to do a convertible debt with a cap deal with us and one of their guys would play an active role in the startup. We crossed a milestone that is considered quite an important one by many entrepreneurs. This is what I believe we did right:

1) Our product was not perfect. Not nearly. It worked well in other markets. But in India it would not. It would need some customization. We knew it, we acknowledged that they knew better than us. Since they would take part in day to day running of the company the fact that we did not have as much expertise as an investor would have liked to see in us before he could invest did not matter much, hence. As much as they appreciated the humility in us, they loved how we wanted to be transparent to a fault. Ultimately you are communicating with your investors. You got to do a near perfect job in articulating your weaknesses. Because they will see it. Almost instantly.

2) Although the product was not perfect but it was nothing less than damn good. The product guys had done an incredible job. The product was working well in other markets. The investors got this figured out- the potential of the product once it is tweaked to Indian needs. So we had built a product that had some traction. Okay, it needed some changes to fit to the Indian market but that could be done. You can be a Steve Jobs in making presentations. But nothing is more articulate than a product that works. You have an idea and you start building something. It is almost guaranteed that after a few months when you release your first version, when the idea becomes a product/prototype it is much more evolved. You have much better experience about the market and what you are doing overall. It also shows that you are passionate about your idea and that you are committed. Now, that you have your first release its a good idea to get a few clients to use your product. Even if they don’t pay you. If they say to your investors that they are loving your product and would definitely become your client once their current contract is over, it is no less than a sweet song to investor’s ears. And when you have a product you can also flirt with the idea of not going to investors at all, although I am not fond of this idea. Building the first version doesn’t take more than a couple of months or maybe a little more. If it takes more than you’re not doing it right. Neither does it take more than a couple of lacs of rupees ($4k in India). If you can’t raise this on your own, then probably you should think again what you’re doing.

3) We’re all working full time and we’re working on nothing else. I am sure this was a huge bonus for us. I know an Indian company that got funded by a VC. When I spoke with one of the founders, he said the only thing he regrets is that couple of his friends did not join him full time early on. If they had he would have been at least 6 months ahead of where he is now. I’m doing my second start-up. My co-founder happens to be my lead and only programmer. He is not full-time into this. And this is a real pain in the arse. We’re at least a couple of months late to launch our product.

4) You really got to know the domain you’re in extremely well. Since we were not extremely good in understanding the needs of the Indian market, our product did not fit well into the market. But we were in a way lucky because the investors in our case, were going to join us in running day to day operations. They were immensely experienced in the domain. I don’t think there is anyone in India with more experience better at what they do. 75% of the market pays for their service, maybe more by now. So we got the perfect balance in the team. The investors would give product inputs that would help us build a product that fits well with the Indian market. Along with that their main responsibility was marketing. They were already doing marketing of their services. So, if you’re developing an mobile ad network service, you better get one of the best marketing guys from InMobi in your team.

Right now, I can only think of these few critical elements that I believe helped us get a yes from the investors. I may have missed a few points, but I’m pretty sure if you get these points covered well, your chances of getting investment would increase many folds.

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A knowledge search-engine.

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One of the major reasons for the success and popularity of the internet has been due to social networks like Facebook. However, I rate Google’s contribution to this extra-ordinary celebration of internet more than any other internet real-estate till date, even more than e-mail. I could be partial though, for one reason; I am not social-savvy. I have only 170 odd friends in my Facebook account. But I do have a coherent argument for my ratiocination. Searching information is an elementary need that was not well catered until Google got invented. I remember, as a child I had so many questions, in my mind- questions which sometimes my parents and teachers did not know the answers of. I remember how I would spend hours searching for those answers in my school library. Now when I think of those days, I feel like I was living in poverty. Google is like the electricity of the 21st century.

Some may argue Facebook gets information too. I agree. The information brought to you by Facebook is equally important if not less. But it is curated by your social circle, it is real-time and I am more than convinced that this is the future. But we would still need ‘conventional search-engines’ right? It is safe to say that Google is a conventional search engine, now that it is more than a decade old. So is Bing too (because it’s still not very different from Google!) None of Google or Bing have done well in the real-time search. But then who has? Twitter? I believe we still do not know how real-time search is going to get unfolded. So we have to be patient for a while until someone does an incredible job. Are there any other threats to conventional search engines? I think so.

Apple bought a company a couple of years back called, Siri. While conventional search engines are busy bombarding you with results, Siri takes decisions on your behalf. E.g. if you are looking for a cab, you need to search for an operator, then choose one and only then can you make a call. A search with Siri would simply get the cab on your way with a single click (it works on iPhone). Amazing! People go to sites like Yelp in USA and Burrp in India to find restaurants. People are going to specific apps to find specific information. When I was at college, I used to write technology papers to participate in competitions, conferences etc. 95% of the time I was on internet was spent on searching scholastic content that would help me write papers. When I joined one of the start-ups incubating at my college campus in 2nd semester I saw the developers do only a couple things on the internet: Facebook and post coding questions. I noted that my friends too spent a lot of time on the internet to learn cool new stuffs. So a question struck my mind- is Google the end of hope for all those people who use internet as an alternate source of learning? I bet there is a hell lot of people out there spending hours in the internet to learn things. There is Twitter for real-time search. Apparently. Yelp for restaurants. Siri too. And there are no search-engines for learning purposes, even though there are like 500 million to 1 Billion people using internet to learn? Crap!

We were looking for a solution to this problem. After a couple of months spent on ideating and then a few more on refining and writing experimental codes, we hit on what ‘Wisely’ shall be known for when we launch it in August, 2011. Our vision is beyond spreading social wisdom. We are working towards becoming the knowledge search engine of the world, putting processes and technologies into play that were never ever tried before to achieve what we are trying to do. Our vision is not limited to creating an application for searching ‘learning-content’, but goes as far as developing a platform that opens learning institutions, connect internet users with relevant content across multiple networks and help developers create beautiful applications using our APIs to enhance our distribution and content generation channels. A wide reach of Wisely would ensure even greater participation. More participation means more collaboration. Wisely is not becoming a virtual university. Wisely is a place where everyone can come to learn whatever they wish to and share whatever they know in incredibly human ways. Wisely is a celebration of open-source education and social power.

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Facebook’s death is not far away.

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Yesterday, I was chatting with my girlfriend on LinkedIn. Why? Well, LinkedIn is the only network she can access from her work. No Gmail and Facebook at her office. I am sure she is not the only one denied of the internet comforts- there are millions like her. Such a pain in the arse, eh? I know. But you could hardly blame the employers. The employers are boring and so is the job they do. Even they know it. So, they fear they might lose productivity to things that are  little less boring than them, like Facebook.

Yes, I dare say that. No, I am not drunk. Facebook is boring and it is nearing its death. It is not an epiphany that I had at 5 a.m. in the morning. It is not an assumption to make this blog controversial. But, it is a prediction based on historical facts and human behavior. Now, I must start writing precisely why I feel so. Well, before that let us remind ourselves, why is Facebook successful? There is certainly an element of luck, the wonder effect of timing and so many other things that experts and industry watchers would tell you. But I shall state two very simple reasons why I feel Facebook is successful:

a) Human beings are social. (Facebook exploited the best of it, better than anyone else.)

b) Human beings love apps. (Facebook saw this opportunity early on.)

Now, I am going to tell you how these two basic reasons behind Facebook’s are slowly becoming irrelevant. Thousands of years ago when the first of the men was born, what do you think he must have done when he saw another man? Certainly he did not say, “Hey I like chickens, so do you, we could be friends and have chickens together every dinner”. I bet they were curious to know about each other’s intentions, as we are so conscious about our safety. They must have communicated first to ensure they have each other’s trust. The most notable thing here is the action they first took- communication. Then they took the next step, they became friends, made a society eventually with other chicken loving people.

Incredibly the basic steps of human evolution still holds true after thousands of years when people got onto internet in the 1990s. Email became the first most commonly used app for communication on the internet. And only  then came the era of MySpace, Orkut, Facebook etc. People started socializing online.  Let us go back again. Only 50 years back. Did people socialize the same way as people do today? The answer is NO. People were way more social  in the yesteryears than they are today. If you don’t believe me, then just ask your grandparents. They would tell you how those olden times were, when people used to have lot of time and bigger hearts. As societies evolved from villages to cities to metropolitans to mega-cities, people living on it have become increasingly self-centered. Their social circles may have grown bigger, but not the commitments or the intensity. In the real world, this is the era of productivity, getting the most of one’s time and resources and not much about going to work and coming back home and have beers with “thy neighbor”.  Don’t you think that the evolution would eventually play itself on the virtual world too? Did you not add even the ones whom you did not know as friends on Facebook to just flaunt your friend list? How many of the friends do you chat with, even once when you see them online? 10%, 20%, okay 30%?

The era of productivity on the internet is knocking the door. Getting the most out of the time you spend doing whatever you are, is what you are ever going to count. Technology will make many of the things easier than they ever were. But life is not becoming any easier because of it. People will have to be smarter, more knowledgeable and more productive. And internet is going to be the tool that is going to help you be so.

This is also the era of personal social networks (like Path, maybe) where you connect only to those 10%-20% you really care about. I don’t think a stranger has any business knowing when I have a break-up or see photos of my house-warming party.

I don’t think that I have to write much on the second reason, about the apps. It is unarguable that the most lovable apps are on the mobile devices. I have stopped using Facebook apps. They are lame, dumb and stupid. I don’t give a f**k what the cookies or what the crystal ball says. Now one might ask what about the photo-sharing? Well, I guess there are incredible apps out there now like ‘instagram’ which does a classier job. I hope the Twitter’s app would also be great. Anyways social networking and sharing is being re-invented everyday. Only shot Facebook has if it continues to buy innovative companies in this space . Otherwise, Facebook’s death is not far away.

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Why should everyone pray for LinkedIn’s success?

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Amidst a caboodle of speculation and rumors LinkedIn got listed on 19th of May, 2011.  LinkedIn became the first ‘dot-com-company’ after Google to get listed since the late 90s’ dot-com-bubble. No doubt our friends at Palo Alto, California are very excited about it and I bet, they would be going that road pretty soon. Okay, much has been said about the investors going crazy post IPO of LinkedIn and how the devil of the 90s is going to haunt us, if we don’t act soon..how all of this is a bubble, blah blah.. But on this blog, I would like to write about why we all should be praying for the successes of Facebook, Twitter and LinkedIn.

Before, I start sharing my thoughts with you, lets crunch some numbers. LinkedIn has over 100 million users, it earns around $ 300m in revenues and its net income is close to $15 m. This sounds attractive to me considering Facebook’s earnings per user in 2010 was less than two bucks. Whereas LinkedIn is earning close to three bucks. This is also great because  people spend much less time on LinkedIn than on Facebook. This level of competence in LinkedIn’s earning with Facebook’s is because the latter does not charge anything from its users, whereas the previous has a freemium model. But what the hell? The difference, if there is any at all in earnings today is only of a buck or two. What is common though is the valuation of the two companies. Goldman Sachs and the Russians invested $1.5b in Facebook at a valuation of $50b plus. Facebook has 500 million users world over, so we can safely assume that currently, worth of one user in Facebook is $100. Interestingly, LinkedIn is now trading over $100 in the share market pushing its valuation in the stock market to close to $10b (100 million users). As we can see  the commonality is the worth of an user in both the networks is around $100. But how much are they actually earning today? Yes you know it already, $2-$3 per user per year! Okay..umm..so this is a bubble after all. Is this bubble going to burst soon like the previous ones? Well, we don’t know it yet. We certainly hope that it doesn’t.

So what do these dream companies do to justify their mega-valuations? The mathematical road is simple. They have to try to multiply their earnings by at least 3-4 times. Or multiply their user-base 3-4 times, magically without sky-rocketing their operational and infrastructure costs. And yes, they have to get this task done fast. I think the best way to do this is not to devise multiple plans to create the magic but to figure out the single most prominent problem and make a strategy to counter it. So what is the most prominent problem? We know that the internet proliferation is happening beyond the boundaries of the developed nations at a very healthy rate. More Indians, Chinese and Brazilians are getting online everyday. So growth in the user-base is not really a problem unless innovation at these tech giants stop, abruptly. The associate infrastructure costs with the growing number of users is also not a problem as the hardware costs are slipping with time. But earnings per user is. Increasing the earnings per user is the single most challenging task in my wisdom. From twitter to facebook to linkedIn, every one of them out there needs to work over time in devising strategies that would help them increase their ‘per user earnings’. They have to do this for themselves and for the security of the future generation of tech start-ups. If they do not, we are just a couple of years away from another ‘dot com meltdown’. And I am afraid this time it would be bigger, longer, far more upsetting and costlier for the ecosystem than the one we had in the late 90s. Imagine losing sight of innovation and creativity like Foursquare or Scvngr for a decade to come. It is not just disheartening for the technology enthusiasts like us but also for the common user of the internet, telecom service providers etc. This is no less than doom.

More specifically for the present generation of  entrepreneurs like me, who have started just now and haven’t seen success yet, the successes of these tech-giants are crucial. Who would fund us if the investors lose money and faith? Where will someone planning a venture now find those brilliant co-founders whom we convinced to leave their jobs to join us? I certainly hope that we do not face such hard times. Hence I pray more, now, for LinkedIn’s, twitter’s and Facebook’s successes. So should you!