What the Media Is Missing About the Apple vs Samsung Case
I made a comment in response to a blog post about the Apple vs Samsung case on Hacker News recently - that got a ton more upvotes than I thought it would have (and a few friends of mine encouraged me to write this post), so I thought I would post the jist of my thoughts here.
Apple wasn’t suing Samsung because they ‘copied’ one of their products. What Samsung has done is straight up IP (Intellectual property) theft.
There are many other companies that come out with many features in their products that Apple doesn’t sue. See Windows, Safari vs Chrome, iPod vs Zune, Adobe Premiere vs Final Cut Pro, most “ultrabooks” vs Macbook Air, etc. The issue here is that Samsung, HTC, et al. essentially have done what many manufacturers in China have done (and are still doing).
They acted like a hardware manufacturing partner - then using the inside knowledge they gained of the intimate architecture of the products, they reverse engineered them and competed directly.
That’s like you hiring a web developer to build your startup - and both of you build it to traction, and once you take all the risk and prove the market, (s)he leaves and builds a direct competitor using his insider knowledge. It’s the most insiduous kind of ‘IP stealing’ that exists.
So Apple’s response is perfectly rational.
If you had that done to you, and your ex-developer (in fact, he is still managing your codebase) is making a ton of money off of your ideas and IP in your market, I am sure you would be pissed too. The money is just sprinkling on top…and a definitive statement to other “partners”.
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Einstein’s Productivity Is a Model for All Entrepreneuers
The next time you think “I will start {X} another time. I have too much going on now….” consider this.
During the period when Albert Einstein wrote his 4 papers that revolutionized physics (including “The General Theory of Relativity”), he had a few things going in his life….including but not limited to:
A full-time job in a patent office in Bern, Switzerland where he worked 6 days - 8 hours a day (yes 6 days).
A relatively new wife (who most of his family hated/despised, at least initially)
They had a daughter, but there is no record of what happened with the daughter (insinuating that maybe his wife lost the baby or they gave her up for adoption - though there is no evidence to suggest as much). Either way, this must have been taxing emotionally.
They then had a son - Hans Albert Einstein
Einstein played in a string quartet once a week.
He had no access to a library to read other publications (because the library was usually closed when he wasn’t at work).
Oh…and he had no computer & no Google =)
Even despite these obstacles, he wrote 4 papers that fundamentally transformed physics and subsequently engineering.
Source - Einstein: His Life & Universe
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The Biggest Problem, for Jamaica’s Tech Industry, Is the Sum of Our Smaller Problems
I just came from lunch with Chad Cunningham and Gordon Swaby. We are trying to figure out, and put into words, the issues facing tech (more specifically internet/web) companies in Jamaica for a meeting with a government official coming up shortly.
After going through many scenarios of issues we face, the recurring theme always came back to the “small problems”.
Registering an LLC easily & cheaply
Getting all documentation and tax compliance information in order for everything to be above board.
Getting health insurance for the owner and the handful of employees (and their families)
Accepting VISA, Mastercard, Discover, American Express from any consumer around the world
Doing business with US-based organizations
Importing any equipment we may need (laptops, computers, networking equipment, iPads, etc.) for everyday use - with a predictable cost. Right now, you never know what the end cost will be once the various duties and levies are attached.
Right now, all of the above are a headache in one way or another.
I have had to register a US-based Delaware Corp to get a US bank account to allow me to get a US payment processor account to process US-issued credit cards. All of that was easier (not easy) than working with the local banks. Not to mention that the local banks don’t process (the last I checked) Discover and American Express issued cards.
Gordon eloquently summed up our current problems with this phrase that I love so much that I had to write a post about it.
“Our biggest problem is the sum of our smaller problems.”
Tech startups don’t need a government run Venture Capital arm - what we need is a regulatory & justice system that allows investors to purchase preferred shares (or even common shares) in our companies and be adequately protected (both from culpability & liability for the wrong-doings of any companies they invest in). Just like a typical equity investment in the US.
Tech startups don’t need a government run health insurance program - what we need is to be able to buy insurance from the existing entities on similar terms that any individual can get by joining Churches Credit Union, or JN.
Tech startups don’t need large tax incentives because our net margins are high, and paying taxes is a good problem to have.
Tech startups don’t need any government land or buildings - because we can get by in our own homes/garages/offices.
Tech startups don’t need special treatment - all we need is fair treatment. We need the government to either issue new banking licenses to encourage competition in the banking industry - specifically to a bank interested in specializing in e-commerce transactions. From selling products online, to managing subscription payments in Software-as-a-Service (SaaS) apps. Or heavily lean on existing institutions to be more e-commerce friendly, although…the skeptic in me thinks we would be better off with good old-fashioned competition. Issuing a new banking license to an entity interested in mobile & e-commerce would probably be the best bet.
Tech startups don’t even need import waivers, we just need certainty. We need to know that if we are bringing in an iPad, once it touches the shores we will be paying a flat fee (that is reasonable, 50%+ is NOT reasonable) for duty. We already know, via Mailpac, what the flat fee for the shipping will be. We need to know all the other flat fees.
Once those problems are fixed, the last thing we need is for JAMPRO to tell the world that Jamaica’s tech industry is open for business.
Show investors that there is a clear path to liquidity via our Junior Stock Exchange and JSE (especially through a USD offering).
In short, we just need the government to streamline the basic issues that we have to deal with - i.e. the “small, every day problems”, and we will take care of the rest.
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The Life of a Bootstrapper - Canada Denied Me a Visitors Visa Because “I Am Too Poor”
Update: I re-applied with additional information about my business and financial situation and they approved the visa for 2 - 3 years.
I recently applied for a visitors visa to Canada (officially known as a ‘Temporary Residents Visa’) because my best friend is getting married in July. I went to Canada about 3 years ago for his brother’s wedding - around the same time of year - and it was nice. I have been looking forward to the trip.
Granted, I had my suspicions that my application was weaker than it could be - for a number of reasons.
I am a bootstrapper. A few months ago, I started doing freelance web development to pay the bills. The issue with that is the cash flow fluctuates significantly. So when a good month happens, I have to put aside for slower months.
Needless to say, I couldn’t provide a ‘job letter’ or show any ‘proof of employment’ to a Jamaican company that requires that I live in Jamaica - because no such thing exists. The best I can do is show company registration documentation, and bank account statements in all my bank accounts (locally, and US-based). Also, the application process has collided with a “slower period” - so the bank statements are not flattering, to say the least.
I don’t own where I live, I rent.
I purposely chose not to use my parents as financial support, because…well…I am almost 30 and have 2 kids (with 1 on the way). Plus…I earn my own living (kinda), damnit!
Before deciding to go down this road, I read ENDLESS stories and blog posts about others that have trod a similar path. I debated doing something where I raise money, or bootstrap. I hated the idea of losing control and I seem to have an affinity to doing things the hard way (not that raising money isn’t the hard way).
One of the things I didn’t quite realize is that even though you are bootstrapping, life doesn’t stop. You still need to interact with institutions that don’t understand the concept of a bootstrapper or even the startup life or even freelancing.
So let this be another data point you should consider when you think about bootstrapping. I always thought, “nah…that will never happen to me”. Seems it’s more the rule than the exception.
Now, it seems, I will be missing my best friend’s wedding in July.
I read about rock-bottom, but never knew what it felt like. I know you might scoff “Pfftt…I used to live in my car”, but compared to what I am accustomed to, these last few months have been pretty damn hard and this almost feels like the nail in the coffin.
I am a pretty private guy, but I didn’t know what else to do other than let it all out.
The worst part about this all, is that I can’t see myself doing anything else - no matter how tempting it may be.
In other news, I am working on another product that I hope to launch in the coming days/week. If you are a freelancer, and want to find new business leads easier, follow me on Twitter so you can know when I launch that.
This is the life I chose, or better yet, the life that chose me.
Hacker’s Guide to Cashflow vs Profit
President Obama You Lied
Please don’t get me wrong. I am one of those people that supported your nascent campaign once you declared in Illinois. If I could have voted in 2008, I would have voted for you.
Even though I am not Congressman Wilson, I have to say it, you lied!
You have said that you would rather be a really good one-term president, than a mediocre two-term president.
As is evidenced from the way you recklessly managed the debt ceiling issue, you clearly had the 2012 re-election campaign in your sights.
The right thing for the country, and the world, would have been for you to stick to loose fiscal policy in the immediate-short term, and lay out a credible medium term plan for reigning in the deficits and paying down the debt once the economy has fully recovered. But you did just the opposite - with allowing the Republicans to cajoling you into short-term spending cuts and shirking the responsibility for the real tough decisions (like tackling social security, and medicare reform) to a Congressional Committee.
The ironic thing is, as you can see from the markets reaction, if the economy continues to deteriorate and slips back into a recession just in the nick of time of the next re-election - you will likely be the worst combination of what you wanted.
A mediocre one-term president.
That would be a travesty, because you had so much potential.
A Simple Solution to America’s Social Security Problem
TL;DR - Legalize all illegal immigrants and have an open immigration policy that makes up for the shortfall in the workforce.
The way Social Security works is, every dollar you pay in taxes today, goes to paying the check for a retiree.
To get a full appreciation for the Social Security Problem, let’s run some quick math.
Let’s assume that each Baby Boomer is retiring at the age of 65. Also assume that each retiree lives for 30 years after retirement.
Also assume that each retiree is expecting to get $45K/year - which is likely to be VERY conservative, but, for simplicity’s sake let’s just use $45K/year.
Each retiree would have to be paid $45K * 30 years = $1.35M during retirement (let’s round it up to $1.5M to make it easier on the math).
Also assume that there is a gap of about 30 million people, meaning there are 30 million more people retiring (i.e. baby boomers) than there are replacing them (i.e. young people entering the work force for the first time) - and the gap could be wider, but for math’s sake, let’s go with that.
That means, it’s: 30,000,000 people * $1.5M = $45,000,000,000,000 (i.e. $30 Trillion)
This ignores the health care related expenses for those retirees. This is a major problem, and this is what people mean when they say that Social Security is ‘unfunded’. i.e. there is a chunk of retirees that have no one just entering the workforce that will support them.
Solution: Expand the workforce to be greater than the number of retirees. i.e. Legalize all the illegal immigrants and open the gates so anyone can come and work in America….up to a comfortable number over and above the number of retirees.
Obviously, I know there are political consequences to making a move like this and other repercussions, but if America’s leaders were honest enough about this solution they would start having this debate and figuring out how to solve it properly. This solution would also have to be done in tandem with other things like raising the retirement age, migrating from Defined Benefits to Defined Contribution, etc. But, by far, this solution would take care of the major driver of the problem - that more people are retiring than entering the workforce.