In the spring of 2016, Foursquare CEO Jeff Glueck went on CNBC to make a bold prediction: Chipotle comparable sales would fall by 29 percent in its first quarter. The network’s anchor seemed skeptical. The fast-food chain was reacting to some health scares at the time, but no one was predicting nearly as steep a drop in revenue. “What is the technology here? What have you got that enables you to do this?” the anchor asked.
.. Foursquare had reinvented itself as a location intelligence company for business
.. Glueck had been making the rounds for less than a year, seeding the market with all kinds of predictions based on his company’s data — how many new iPhones Apple would sell, or how well McDonald’s all-day breakfast launch was going. The Chipotle forecast was the boldest yet, and it held true.
.. The startup had accumulated mountains of data about where people shopped and traveled but hadn’t figured out how to monetize it. Today, that puzzle seems to have been solved: Foursquare is on the path to $100 million in revenue
.. The reward for sharing? Stickers. Badges. Friendly competition to become the mayor of a favorite bar. And, critically, being part of a community of people sharing recommendations on the best of everything around them.
.. “He initially thought this company would build a local Yellow Pages-type business,”
.. Asset number one: The more than 11 billion check-ins tracking people in real life since 2009.
Asset number two: The four million monthly updates to its Places database — changes in address, phone number, a Japanese restaurant that was now a spaghetti joint.
And then there was the sleeper, asset number three: 100,000 developers tapping into the Foursquare API — its location technology — for free
Enormous companies like Yahoo and Pinterest were using it a billion times a year; for example, when you pin a photo in Pinterest and tag its location, that’s using Foursquare’s data. But Foursquare had never asked these companies to pay.
.. The company needed to think of itself as a location data company. Based on GPS and other location signals, Foursquare could tell what business a user was visiting — something no other company could do as reliably.
.. It asked those big companies to start paying for its API;
.. the developers on the other end of the line basically laughed and said, “Yeah, we were wondering when you were going to start charging.”
.. the flywheel concept, a visual metaphor for business. When first pushed, a flywheel moves slowly and with great effort. With every successive revolution, the pace quickens. To the outsider, it appears the momentum is sudden, but, in fact, it’s the product of a steady grind.
.. investors told him it would take eight to 10 years to make the business work.
.. Ninety-two percent of commerce takes place in real life, not online. That means Google can tell you about only 8 percent of what everyone is doing with their spending habits.
.. Foursquare has signed deals with Snapchat to improve its geo-filtering. More than one million users have agreed to leave location sharing on all the time so Foursquare can track and analyze their movements; through a partnership with Nielsen, that data is then being connected to consumers’ purchasing data, so that marketers can understand how ads people see directly relate to purchases they make.
.. “Three of the top five hedge funds are using Foursquare data to give them an investing edge.”
.. it’s a location intelligence company — something that should be measured the same way as a services-as-a-software or programmatic advertising firm
Besides money, Chinese companies have another edge against their U.S. competitors: the vast amount of data they have to work with—created by 731 million online users. In China, people use their smartphones to a much greater degree than in the U.S., and that has created a much richer trove of data for researchers.
Most companies capture a small fraction of their data’s value
It’s often been said that truly transformative innovations are overhyped in the short term but under-hyped in the long term. Think of electricity and automobiles, the internet more recently and now big data.
When first developed in the late 19th century, electricity was mostly used to replace kerosene lamps and candles with light bulbs. It took several decades for electric appliances, the assembly line and mass production to emerge and help create whole new industries. Similarly, the full impact of automobiles was not felt until the mid-20th century with the rise of suburbs, the Interstate Highway system, and the motels, restaurants and gas stations that sprung up all around them.
.. In 2000, only one-quarter of the world’s stored information was digital and thus subject to search and analysis. Since then, the amount of digital data has been doubling roughly every three years. By now only a small amount of all stored information isn’t digital, around 1% or so. This could not have possibly happened without the digital revolution
..
Micro-segmenting a population based on individuals’ characteristics as revealed by data and analytics;
If the logic driving the Fords and the Carnegies was to atone for the sins of rapacious capitalism, the logic of the Zuckerbergs and the Omidyars is to convince us that rapacious capitalism, fully unleashed on society, will do lots of good.
.. Parents of these students can hope that Summit Basecamp will keep its word and that no personal data will ever leave the company. Such promises won’t be any more reassuring than those of the founders of WhatsApp, who, on being acquired by Facebook, promised to defend their users’ personal data, only to announce, a few months ago, that it will be shared with Facebook.
.. What passes for philanthropy these days is often just a sophisticated effort to make money on engineering the kinds of rational, entrepreneurial and quantitative souls that would delight at other types of personalisation. Such learning is, of course, well suited to the needs of consulting firms and technology giants. A recent profile of AltSchool in the New Yorker mentioned that its students read the Iliad armed with a spreadsheet where they mark how many times the theme of “rage” occurs in the text. Such schools can produce excellent auditors; poets, however, might need an alternative, to, well, the AltSchool.
.. The very same technology elites are also backing the charter school movement – a longrunning effort to bring more competition to the educational sector by supporting privately run but publicly funded educational initiatives. From Gates to Zuckerberg, technology billionaires are vocal defenders of this movement. It won’t be surprising if they deploy their big data weapons to advance the argument that the traditional educational system must be completely overhauled.
.. We should be careful not to fall victim to a perverse form of Stockholm syndrome, coming to sympathise with the corporate kidnappers of our democracy. On the one hand, given that the new tech billionaires pay very little tax, it’s not surprising that the public sector would fail to innovate as quickly. On the other, by constantly giving the private sector a head start through technologies that they own and develop, the new tech elites all but ensure that the public would rather choose slick but privatised technological solutions over quaint, but public, political ones.
.. With Silicon Valley elites so keen on saving the world, shouldn’t we also ask who will eventually save us from Silicon Valley?