In JC’s Newsletter, I share the articles, documentaries and books that I enjoyed the most in the last week, with some comments on how we relate to them at Alan. I do not endorse all the articles I share, they are up for debate.
I’m doing it because a) I love reading, it is the way that I get most of my ideas, b) I’m already sharing those ideas with my team, and c) I would love to get your perspective on those.
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👉 The hottest and least understood e-commerce model: Community Group Buying (LilianLi)
Online grocery 2.0 community group-buying, the format works like this:
A self-designated community leader creates and maintains a WeChat group.
Community leader sign-ups individuals from their local region (usually within their regular walking distance), each WeChat group is capped at 500 people.
They maintain a weekly or daily schedule of posting a product selection to the group. The products are links to mini-programs where residents click through to place their orders. Residents do not have to order the same products and will only need to pay when their collective demand exceeds a designated value.
The products are not limited to groceries but also include other life essentials like paper towels.
Once the residents place their orders, the entire collated order is delivered in bulk to collection points the next day for the community leader to pick up.
Community leader unpacks the bulk order and then organises this into the resident's orders. They will either deliver the order, or the residents will come to this pick up themselves.
In case of issues, the community leader is the first point of contact for the residents. They will escalate the problem to the platforms and handle the resolution on behalf of the residents.
For their work, the community leaders get 10% commission from their group orders. Given the hands-on nature of the work, a community leader can typically only manage three WeChat groups well at any one point.
I really like this model of leveraging the community to accelerate growth, run operations for you. I find it very smart.
Now CAC is lowered since community leaders are responsible for creating their own customer groups. Customer Lifetime Value (CLTV) is extended since customers have more hands-on support and social buying promotes frequent purchases.
Community leaders and customers take care of the last-mile delivery, shaving off precious additional logistics costs
The platform can carry fewer SKUs, buying in large quantities directly from the source rather than through intermediaries and have higher pass-through rate
For the community leaders, who are typically local shopkeepers or stay-at-home mums, they can earn additional revenue while serving their community
Really defining who your persona is makes a huge difference.
Owning the community leaders - Since community leaders are the single source of contact between the customers and the platform. Owning them is crucial to the success of this business
Ability to offer relevant SKUs - Since users are not making spontaneous purchases in community group buying, the CGB has the potential to become the decentralised Costco. The player who understands how to put together a concentrated but high coverage SKU base for the user is the player who can truly fulfil their needs.
🏯 Building a company
👉 Jeff Lawson (CEO of Twilio): How to Build a platform (JoinColossus)
To build something because there is nobody here who's going to give you the instruction book of here's exactly the 100 steps you have to go through to actually get this job done, or to build this company because it's not that obvious. The opportunity is here because we have to figure it out.
When something is hard or ambiguous, you don't know how to do it. Well, our job is to go figure it out. And that's exciting
Very important to remember that the good problems are the ones we have to figure out, and if it has a simple existing solution, it is likely not to be differentiated or inventive.
We built Twilio flex [...] It is a contact center application platform. What's really neat about it is you can go in and spin up a contact center in the cloud in minutes. Just go click some buttons. Here's your contact center. And there's all the things you'd expect a contact center to do. It does voice calls, and text messaging, and chat, and supervisor view, and agent views, and scales up to thousands of thousands of agents and all this stuff. But the next step after you create your contact center, it says, "End developer. Download the SDK and start customizing it." So really it's an API. It's designed for extension and integration and all this stuff.
The way you can think about the symbols, and the rituals, and the heroes and combining those things together to create a cohesive experience.
Then build systems, mechanisms in your company to continually capture why customers are using your product and why some of them aren't using your product.
Create systems to actually create that proximity between your products teams, and your developers, and their customers.
Keep asking the question “Why?” all the time
👉Brain Food: Avoiding Bad Decisions, Ordinary Words, and Starting Today (Newsletterest)
"I try to write using ordinary words and simple sentences. That kind of writing is easier to read, and the easier something is to read, the more deeply readers will engage with it. The less energy they expend on your prose, the more they'll have left for your ideas."
🗞In the news
👉Some tech news (Plateformer)
Hackers affiliated with the Russian government targeted European government officials with LinkedIn messages containing malicious links “designed to exploit unknown vulnerabilities in Windows and iOS,” according to a new report from Google. Finally, a good excuse not to check your LinkedIn messages.
Facebook Group administrators can now designate some members as “experts” who have special knowledge about the groups’s subject matter. They’ll get badges that show up on group posts, comments, and in Q&A.
Apple’s introduction of App Tracking Transparency has begun to hurt advertisers on Facebook, industry experts say. “People are giving apps permission to track their behavior just 25% of the time, Branch found, severing a data pipeline that has powered the targeted advertising industry for years.”
👉Amazon Primed Andy Jassy to Be CEO. Can He Keep What Jeff Bezos Built? (The Wall Street Journal)
Mr. Jassy is known for digging into the minutiae of his division, Amazon Web Services, sometimes to a degree that baffled his underlings.
He did everything from pitching potential customers and guiding technical changes and editing press releases.
“That relentless focus on detail is truly unique.”
I like the capacity of going deep!
Mr. Jassy is the third-largest individual shareholder after Mr. Bezos and his ex-wife, MacKenzie Scott. Mr. Jassy’s stake amounts to about 0.03% of the company.
The number of 0.03% is interesting.
The wheel meeting is emblematic of Mr. Jassy’s view that you can’t rely on people’s good intentions - you need a forcing function to make them live up to company expectations.
If the wheel wasn’t in place, some people wouldn’t come prepared.
The wheel is something where they randomly ask people to explain their business and their numbers on a weekly basis.
👉HTN: Weekly Health Tech Reads 9/12 (Health Tech Nerds)
Amazon is expanding: Amazon Care has ~40k members, to 20 new cities in 2022. (Link)
Flo, an app for period tracking, raised $50 million at a $800 million valuation. The usage stats for Flo are pretty impressive - over 200 million users, one billion menstrual cycles tracked using the app, and 43 million women use it on a monthly basis. Presumably they'll start expanding use cases from here - will be curious to watch how they choose to do so.
KLAS conducted a survey of hospital leaders and found that at the vast majority of organizations, telehealth is now less than 20% of visits - and where it is not, it is still being inflated by COVID-19 and they expect it to come down. This is an interesting chart (pg. 6) looking at where various specialties are using telehealth. Of course mental health is attracting all the attention now, but it highlights other areas where we're likely to see activity moving forward. Link
👉HTN: Weekly Health Tech Reads 8/15 (HealthTechNerds)
LabCorp acquired Ovia Health, a women's health startup building fertility and pregnancy apps sold primarily through employers and health plans.
Ovia generates around $20 million of revenue.
Oscar reported earnings for the quarter. Oscar is currently at ~563,000 members, up 44% YoY.
The +Oscar platform was featured heavily in the discussion and yet it leaves a lot of open questions.
Clover Health reported earnings as well, sending its stock up 11% briefly as total revenue was up 140% YoY, even despite a 111% MCR and a $312 million loss for the quarter.
👉Aon, Willis Towers Scrap $30 Billion Merger Amid Antitrust Impasse (WSJ)
Aon and Willis Towers Watson abandoned a more than $30 billion tie-up to create the world’s largest insurance broker, deciding it wasn’t worth pursuing in the face of Justice Department opposition to the merger.
Aon and Willis Towers, which are both based in Ireland, are the No. 2 and No. 3 biggest brokers measured by revenue behind industry leader New York-based Marsh & McLennan Cos. Together they would have had total annual revenue of more $20 billion, leapfrogging Marsh’s $17.2 billion.
Aon is required to pay Willis Towers a $1 billion termination fee.
👉We’re launching Alan Mind to solve mental health issues in Europe, leveraging our acquisition of Jour
Alan Mind is a B2B mental health solution offering both preventive and curative care to its members, notably leveraging the Jour journaling app (which we acquired in the summer).
Alan Mind is based on three pillars, and is currently available to corporate customers in France:
Remote or in-person therapy,
Digital mental health exercises,
Interested about Alan Mind for your company? Register your interest here
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