Majority World Report 2014

1. Majority World Report 2014
@cape
Web Summit, Nov 2014

2. It’s a big networked world out there

3. And it’s not one we know well

4. It’s changing and growing incredibly fast

5. And with mobile, it will connect 5.6bn people within 5 years

6. The stakes are high

7. Especially now you can win very big, very fast

8. $3.2bn
(Jan 2014)
$3.1bn
(Apr
2007)
$1.65bn
(Oct 2006)
$966M
(Jun 2013)

9. $1bn
(Apr
2012)
$22bn
(Feb 2014)
$2bn
(Mar 2014)

10. Teenager from NZ went from unknown to 360m views

11. It takes less and less time to create $10bn in value

12. >$5bn rev
4 years old

13. $985m rev (2013)
$8.85bn Mkt Cap
10 years

14. $1bn rev
$3.2bn M&A
6 years

15. $6.5bn rev
$248bn Market Cap
15 years

16. So how is European
tech doing?
Despite appearances,
actually pretty well…

17. Born in Edinburgh
$800m round led by Sequoia (Oct 2013)

18. $250m led by TCV
(Nov 2013)
Born in Stockholm

19. Born in Paris
$2bn IPO (Oct 2013)

20. >$3m rev per day
51% for $2bn (Oct 2013)
3 years
Born in Helsinki

21. Born in Berlin
$700m round led by IVP
(Jan 2014)

22. Raised in San Francisco
(via Dublin)
$80m round led by
Founders Fund (Jan 2014)

23. Born in Tel Aviv
4 years
$900m M&A (Feb 2014)

24. Born in London & Stockholm
$7bn IPO (Mar 2014)
1.2bn games daily
>$1.8bn rev (2013)

25. Born in Stockholm
$110m round (Mar 2014)

26. Born in Copenhagen
$2.4bn IPO (Apr 2014)

27. IPO (May 2014)
$1.7bn Market Cap
Raised in San Francisco
(born in Copenhagen)

28. Born in London
$1.6bn IPO (June 2014)

29. Born in
London$65m
round (June
2014)

30. Born in London
$4.5bn IPO (June 2014)

31. Born in Jerusalem
$7.6bn IPO (July 2014)

32. Born in Paris
$100m raise
(July 2014)

33. Born in Stockholm
$290m rev
$2.5bn M&A (Sept 2014)
4 yrs

34. Born in Berlin
$2.3bn rev
$6.8bn IPO (Sept 2014)

35. Born in Berlin
$2bn raised
$8bn IPO (Sept 2014)

36. The sun is out, the sky is blue….

37. But GDP growth is not beautiful in
developed economies

38. And people are worried about their futures…
To what extent, if at all, do you feel that today’s youth will have had a better or worse life than their parents generations or will it be the same?
Ipsos Mori Global Trends 2014

39. They are worried about their jobs….

40. They’re worried about social justice

41. About being able to vote…

42. About machine men & their machine minds…

43. That they won’t have a better life than their parents

44. Education isn’t preparing us for the new
Majority World

45. There is a massive gap between what
we learn and what we need to learn

46. We are still living in a bubble

47. Forbes 2000
$20tn in market cap
More than 80m employees

48. They spend > $1tn a year on IT

49. But technology is not doing much to save them

50. In fact it is turning every sector in the
Forbes 2000 upside down

51. 20
18
16
14
12
10
8
6
4
2
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
EU
US
In just 20 years, over 220 “Unicorns” have been born

52. But only a few sectors have really been seriously disrupted
400
350
300
250
200
150
100
50
0
Forbes 2000 Companies Companies Valued over 1$bn
Forbes 2000 list, Cruchbase, Aileen Lee’s list, Fred Wilson’s Hackpad and Index’s own research

53. So should Forbes 2000 be investing like Facebook?
$85tn global AUM
($12k per human)
$266bn FTSE100
($5k per UK citizen)

54. With so much money at stake who is holding
boards and management accountable?

55. One easy piece of advice……

56. We know 7% of small companies create
>50% of new jobs
.

57. Start ups can create enormous value in a very short time
1978 1981 1987 1995 1995 1997 1999 1999 2005
serving >1bn customers
creating 440k new jobs
with $545bn in new annual revenue
and $1.4tn in new market value
Source: HIS Global Insight
21% US GDP

58. Maybe that’s why 55m people on Facebook
are interested in “Entrepreneurship”

59. Millennial Manifesto is going global…

60. New entrepreneurs can come from anywhere
0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00%
Percentage of cities population who are interested in Entrepreneurship
Data from the facebook API, looking at pages people like, posts
Dublin
Tel Aviv
Manila
Sydney
Sao Paolo
London
Stockholm
Jakarta
San Francisco
NYC
Palo Alto
Delhi
Boston
Berlin
Paris

61. Becoming an entrepreneur is going mainstream

62. But Europe’s great universities are almost nowhere
in supporting this movement
PitchBook Report of Top 50 Universities for VC backed Companies

63. So how should you think about
catching the wave?

64. Aim high and shoot for the moon

65. Remember #risk62 – you will lose most of your time and money
60
50
40
30
20
10
0
x<0.5 0.5<=x<1 x=1 1<x<2 2<=x<5 x>=5
% Cost % Value

66. So learn by doing

67. Join the New Creative Generation

68. “The Internet isn’t really a technology.
It’s a belief system”

70. @cape
♯demand8

71. Appendix
Extra Slides

73. Europe is ahead of US and Japan despite itself

74. It’s really expensive to break into the charts
Top Mobile Apps 2014

78. Network effects reinforce success

80. We’ve had almost 60 years of evidence on how innovation economics
can drive explosive social and economic value creation…..
Semis
Hardware
Software
Internet
Crowd
Networking Mobile Cloud

81. 80-90% of radical innovations fail

82. Forbes 2000 top 20 Countries
600
500
400
300
200
100
0
Number of Companies on Forbes 2000 list

83. 1. Do you have a public version of the GOV.uk dashboard?

84. 2. Ok, how about you show us just one high volume service?

85. 3. How do you benchmark vs your national GDP?

86. 4. You spend at least $1bn pa on IT. Do you spend at least
5.5% with start-ups?

87. 5. How digital literate is your board and senior team?

88. 10k business ideas
1k firms started
100 VC funded
20 IPO
2
market
leaders
Professor
Edmund
Phelps
Nobel
Prize in
Economics
2006
Less than 10% of business ideas even get started

89. New entrepreneurs can come from anywhere
Percentage of countries population who are interested in Entrepreneurship
Data from the facebook API, looking at pages people like, posts and other demographic information

90. In most countries, Ronaldo..
Ronaldo V Entrepreneurship
0 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000
US
India
Brazil
Philippines
UK
Indonesia
Egypt
Australia
Canada
Turkey
Mexico
South Africa
Nigeria
Italy
Argentina
France
Saudi Arabia
Poland
Germany
Vietnam
Entrepreneurship
Ronaldo

91. You have to learn take risks
Time Emotions Money

92. Europe is in a state

93. Especially in EU & North America

94. And in Europe this is hardly a surprise

95. But growth is somewhere else

96. Worried about speaking out

97. EU is growing slower than RoW

101. 500m Spanish views
6 months