An investor has to pick the next investment-worthy start-up out of a sea of candidates and, most importantly, find it before other investors.

The skillsets necessary for the two professions are similar, which is why we see more and more reporters trying their hands at investing. Jon Russell, the recently appointed partner of Crypto.com Capital, is one such example.

From journalism to venture capital

A former journalist, Jon began his Southeast Asia stint in 2008 stationed in Bangkok, Thailand. He spent the next eight years covering Southeast Asia business and technology for renowned media such as The Next Web and TechCrunch. In 2019, he joined startup The Ken, a subscription-driven technology media, as the Southeast Asia editor.

In early 2022, Jon made the jump to venture capital. He joined Crypto.com Capital, the cryptocurrency exchanges’ investment unit with USD500 million under management, and now oversees investment opportunities in Southeast Asia. Since its inception a year ago, Crypto.com Capital has invested in 60 Web3 start-ups focusing on blockchain infrastructure and DeFi, closing one investment deal every 1-2 weeks.

South Asia, very promising

Compared with western markets, what are the challenges and opportunities of Web3 development in Southeast Asia? And with a reporting background, how does he make investment decisions in this highly technical sector? In this podcast episode of Knowledge Surfing, Jon shared his observations and thoughts on the Web3 space in Southeast Asia.

He pointed out that there is nothing inferior about the Web3 market in Southeast Asia, bringing up the popular game Axie Infinity, which Vietnam-based Sky Mavis developed. According to data from Chainalysis, cryptocurrency holders in Singapore account for 10% of the country’s total population, compared with just 8.3% in the US.

Jon shared an anecdote about cryptocurrency’s high penetration in Southeast Asia. While taking a motorbike taxi, he noticed that the driver constantly had a cryptocurrency trading app on his phone screen to get the latest market action.

So does Southeast Asia have what it takes to be a leading region for Web3 development? Jon pointed out that Singapore, an Asia financial hub, already has many tech talents involved with De-Fi and blockchain infrastructure projects. However, countries like India, Indonesia, Vietnam, and Thailand still need to foster human resources in this sector.

He added that tech talents need to catch up with the opportunities created by the massive population. When that happens, Southeast Asia can be a breeding ground for “homegrown” Web3 giants instead of playing a supporting role to more prominent international companies.

What is he looking for?

With past journalistic experiences, Jon has his own approach to selecting investment targets. For example, many Web3 projects are in blockchain infrastructure, so the product pitches are often full of technical terms and not the easiest to follow. Though Jon has a team for inspecting the technological aspects, he believes a good founder should be able to clearly communicate what the company does and why it’s essential regardless of the investor’s technical knowledge. “If a person can’t explain what they’re doing in an hour, there’s obviously some kind of issue there,” Jon said.

Jon further pointed out that some Web3 start-ups built viable business models via the flywheel effect. NFT app Floor is a good case in point.

Users must first pay a USD100 fee to access the app, establishing a solid foundation and momentum for an NFT community. The users are not only interested in NFT; they are passionate and willing to pay to join. Floor further rolled out podcasts, newsletters, and social engagement services, all tailor-made for these paid users. Jon believes effective management of loyal users will create other business opportunities in the future. The app currently has over 3,000 paid users.

He added that designing a friendly UI, minimizing annoying advertisements, and building a user-centric business are enough in this early stage to stay ahead of many Web3 offerings.

Web3, down but not out

Everyone is looking for the next thing that could lead us out of a down-cycle. Jon thinks gaming has the potential. However, the game has to look and feel like a conventional game, not a blockchain-based product with entry barriers such as purchasing expensive NFTs or setting up a crypto wallet. No such killer product exists at the moment, he said.

Again, take play-to-earn Axie Infinity as an example; its true essence should be the game. It must be fun to play, first and foremost. Cryptocurrency and financial concepts should be secondary.

A bearish cryptocurrency market has dampened overall enthusiasm for Web3 projects. Start-up funding valuation is also on a downward trajectory. Investors that are not true believers in cryptocurrency are looking elsewhere. Yet, Jon believes this is a good time to invest, “We’re mostly just prudent. We feel like everything has reached a certain level. I think that’s when we’ll be looking at more outrageous deals as well.”

＊The contents of this episode are not investment advice. Careful research and risk assessment should be made before investing.

Conducting due diligence on a Web3 startup is like drinking from a firehose – there’s just so much information coming at you that it’s hard to know where to start. How does anyone keep up with the overwhelming number of new projects launching every month? And why on earth would land be scarce in the metaverse? 

In this episode, we are excited to sit down with Willy Wu, former General Manager of Uber Taiwan and the current co-founder of Arcade, a metaverse that incorporates all NFT projects. Sit back and relax as Willy addresses the information overflow problem and talks about the utility of land in the metaverse. Find out the difference between working in Web2 and Web3 and how the latter is moving at breakneck speed. From working with Uber to Yuga Labs, Willy’s career journey is one of innovation, open-mindedness, and flexibility. 

This episode does not disappoint – Willy drops some serious knowledge on the NFT space and gives us a glimpse into the future of the metaverse. So whether you’re a founder looking for due diligence tips or an investor trying to keep up with the latest trends, this episode is for you. Tune in now and happy knowledge surfing!

Highlights
From Uber Taiwan to web3 founder how Willy Wu thinks about building a successful project.
️ Yuga Labs, Minty Score, and the Arcade Metaverse.
The difference between web2 and web3 and how to overcome the challenges.
The importance of community and building the right core product.

＊The contents of this episode are not investment advice. Careful research and risk assessment should be made before investing.

It’s impossible to ignore the social media clamor. It seems every other day a new investor has 30x their portfolio by trading NFTs, but how much of it is legit? Are NFTs the latest pyramid scheme or have they revolutionized crowdfunding?

In this episode, we are excited to have Ray, an active crypto trader, take us on a tour of the world of NFTs. Beginning with a brief history of his own experience as a computer science student in the early days of Bitcoin, to his current investments in NFTs.

Ray graduated from UCLA and worked at Facebook as a product manager for 6 years. In late 2020, he moved to Taiwan and quit his job to become a full-time crypto trader. Ray is an early holder of Mutant Ape, Azuki, and other blue chip NFTs. 

This episode will not be riddled with jargon but will give the listener a comprehensive understanding of NFTs, their potential, and what to look for when considering an investment. Ray dives deep into the membership experience that is an NFT stating it’s not just about the art, but the team behind the project and their ability to execute. 

Highlights
A school presentation on Bitcoin, the Dark Web, and the Silk Road. 
NFT is not just a Jpeg but a membership program.
Why did Ray buy over 70 Azuki? And what’s the deal with these mystery beans?
The ultimate beginners’ guide to NFT investment.

＊The contents of this episode are not investment advice. Careful research and risk assessment should be made before investing.

This is Knowledge Surfing, a podcast that covers the latest tech trend with founders and investors. In this episode, we’re excited to welcome Patrick Lee to our show. Patrick is best known as the co-founder and CEO of Rotten Tomatoes. Recently, he launched PKO Investments which focused on the intersection of tech & entertainment.

Highlights?
?‍ Web2 or Web3? Which side is Patrick on?
? How can blockchain change the entertainment industry?
? What is PKO Investments?
? The rise of angel groups and syndicates

*Everything that’s discussed on the show should not be considered financial advice. Please do your own research!

How did Patrick start his startup journey?

Patrick started Rotten Tomatoes in the late 90s, and soon after the Dotcom bubble burst. It was a really hard time for anyone trying to run a startup. However, his passion and belief in the Internet and tech industry supported him through the tough times. Patrick thought the biggest change between doing a startup 20 years ago and now is that, now founding or working in a startup has become a trend. And Silicon Valley basically has become the “Hollywood of startups.”

Web2 or Web3? Which side is Patrick on?

At first, Patrick was not a fan of blockchain startups, because most people in the space seem to be only driven by money rather than actually want to build something. However, he changed his mind when he read about Axie Infinity and how the Play-to-Earn model helped some people in South East Asia earn money and make a living during the pandemic. 

Thoughts on how blockchain and web3 can change the entertainment industry?

Patrick sees a lot of web3 companies are trying to make the distribution of artists’ income more evenly. Artists or creators can’t make very much from streaming platforms or Youtube abs. But Web3 opens new revenue streams for creators. Users and fans can become investors of the artists through tokens or NFTs, and tokens may increase in value and can be traded on secondary markets such as Opensea. 

What is PKO Investments?

PKO is a syndicate that invests in startups in the intersection of tech and entertainment. It consists of 700+ top operators and investors from the tech and entertainment industries. The goal is to bring more value-add to syndicate companies.

*Glossary:

• Not Boring
  Not Boring is a popular newsletter written by Packy McCormick. It covers tech companies, business events, and trends in an interesting & easy-to-digest way. 

This is Knowledge Surfing, a podcast that covers the latest tech trend with founders and investors. In this episode, we are excited to have Edith Yeung, the General Partner of Race Capital to share with us the story of how she invested in Solana and FTX during both companies’ infancy. We also discussed the differences between web2 and web3 companies.

Highlights?
? Investing Solana in 2018
?️ SBF – The Big Breakthrough for Solana
? Tina was on the same boat with SBF!?
? The difference between investing in web2 and web3

How Edith met the founders of Solana and FTX

Edith met Anatoly Yakovenko (Co-founder of Solana) at the NASDAQ Center in San Francisco when giving a talk on how to invest in token and crypto projects in January 2018. He was writing the whitepaper of Solana then. Because of Anatoly’s background in Qualcomm, he came up with the concept of using proof of history. Edith was impressed with his idea and his ambition to build a faster blockchain. Therefore, Edith decided to support this project in 2018. 

In the beginning, few from the blockchain community paid attention to Solana. The big breakthrough came when Sam Bankman-Fried (aka SBF), the founder of FTX, decided to build his project Serum on Solana. This was the first vote of confidence. Then in 2021, many DeFi projects on Solana started to take off. Many projects were attracted by Solana’s low fees and fast performance. And now it has become one of the top blockchain protocols. 

Edith met SBF in a DeFi event in mid-2018. He was standing next to Edith and introducing what he was doing at Alameda Research. Alameda was the top three trading firms in terms of trading volumes on Bitmax. 

Web2 vs. Web3 Investing

• Legal: Traditional VCs that do equity investment might need to discuss with their LPs and amend their LPA so the fund can invest in token deals.

• Managing liquid assets: Traditionally, VC funds only deal with primary markets and usually sell their stakes when their portfolio companies are acquired or go public. However, in the Web3 world, exchanges become distribution and user acquisition channels. And investors will be holding liquid assets. Many VCs have applied for RIA licenses so they can trade a wider range of assets. 

• Founders’ Expectations for Investors: 
  • Web2: investors optimize for ownership. 
  • Web3: Participation is key. No one party should own a majority of a protocol or network. Founders expect investors to be a key participant and contributor in the product and network, and be held accountable for it. 

• IPO vs IDO (Going Public): 
  • Web2: It takes 6 – 10 years for a company to go public. 
  • Web3: There are hundreds of crypto exchanges and they are like the “app store” of crypto. Many companies want to list on crypto exchanges for distribution and user acquisition purposes. Oftentimes a crypto company is listed on the exchange within 2 years of its inception and before they find their PMF(Product Market Fit). Getting listed is just the beginning 

About Edith Yeung

Edith is the General Partner of Race Capital. Prior to Race Capital, she was a general partner at 500 Startups. She has invested in over 50+ startups including Solana, FTX, Stellar/Lightyear, Silk Labs (acquired by Apple), Chirp (acquired by Apple), Fleksy (acquired by Pinterest), Human (acquired by Mapbox), and many more. She started out her career as an engineer and became the GM for Dolphin Browser, a Sequoia-based mobile browser with over 150mn installs worldwide. 

About Race Capital

Founded in 2019, Race Capital, an early-stage Silicon Valley venture capital, invests and partners with pre-seed, seed to Series A companies. Race Capital is generally focused on all B2B/Enterprise on the infrastructure layers of the tech stack.

2020 has been a year of paradoxes. While the COVID-19 pandemic slowed down economies around the globe, it also set fire to investments in the global healthcare industry that received a whopping $21.8B USD in 2020, according to CB Insights. In particular, the Chinese med-tech industry in 2020 grew to around $8.6B USD. With its current momentum, it’s expected to reach $50B USD by 2025, surpassing the U.S. as early as 2023. 

In China, med-tech generally falls into four categories: AI, AR (augmented reality), wearables, and telemedicine. Out of these four, the intersection of AI and medicine receives the most attention because of its unlimited applications to diagnosis, surgery, medicine development, and health management. According to VCBeat Research, China’s AI medicine market reached a valuation of $4.6B USD in 2020, with a CAGR above 40% the past 5 years. In China, the AI medicine market is being transformed by innovation that is catching the attention of investors around the globe.

In a nutshell: Why is this happening?

China’s med-tech industry entered a new stage of development due in large part to three driving factors: 

• An urgency to control the virus
• Favorable investment policies
• Increased investor confidence

In 2020, hospitals were forced to digitally transform overnight due resource constraints. Many physicians utilized new channels of treatment and diagnosis to meet patient demand. In response to the pandemic, the Chinese government also quickly reformed policies restricting AI usage in medicine. In November 2020, the National Medical Products Administration (NMPA) formally issued Infervision an AI third-class certification, allowing them to begin applying their AI technology to clinical use. Soon after, many other companies began receiving the NMPA’s certification, marking a watershed moment in Chinese med-tech history.

With heightened confidence in AI innovation and application to the medical field, capital followed. XtalPi, a medical company founded in 2014 that conducts R&D on AI solutions for global pharmaceutical companies, recently completed its Series-C round with Tencent and Sequoia last September. In addition, AliveX (a Cherubic portfolio) combines AI and immunology to identify biomarkers of disease and recently completed its angel round last December. These companies are two examples of the many Chinese AI medicine companies that have caught a tailwind from the pandemic-era investment boom, boosting confidence in Chinese med-tech innovation.

Why does this matter to you?

The COVID-19 pandemic catapulted the Chinese med-tech industry into a new era. In the short-term, the pandemic increased demand for internet services to supply medical necessities. In the long term, the pandemic is expected to fundamentally change the way in which medical treatment and diagnostics are performed and distributed. In addition to favorable government policies and growing investor confidence, the Chinese med-tech industry is expected to continue to grow exponentially in the coming years, even surpassing the US by 2023.

“Community group buying” is an emerging way for Chinese consumers to shop for groceries and household goods. Group buying platforms have emerged empowering individuals to become “group buyers” or “community leaders” on behalf of their neighbors – unlocking significant bulk discounts for the consumer. 

Group purchases are streamlined via Wechat groups (the messaging app widely used in China). Everyday, the group buyer/leader sends their neighbors a form with a list of selected discounted grocery and household goods, usually 20%-30% cheaper than the same products they’d find in a nearby grocery store. To make a purchase, neighbors simply choose the items they want to buy via the form, and pay in Wechat. These orders are shared directly with the manufacturers by the group buying platforms to make bulk purchases. The next day, the bulk order is delivered to the community leader’s home or a central location for residents to pick-up. 

This method of centralizing shipping and distribution greatly reduces the cost of last-mile delivery and overhead, creating cost-savings that are passed onto the consumer. This approach has been effective in fourth tier cities and rural communities that are uniquely price sensitive and operate in close community settings.

Market landscape

Community group buying first caught the attention of VCs in 2018. At the time, the main players were early stage startups such as Xinsheng Youxuan, China Fresh and Shihui Group. Several startups have since raised huge amounts of funding from VCs, further attracting more players to compete in the space. At its peak, there were more than 200 community group buying platforms in just one city. 

In 2019, the market cooled as investors feared the business model might not be sustainable due to deep product discounts and a hyper competitive market. As capital dried up, the market consolidated with many startups going out of business or being acquired.

Things changed again in early 2020 when COVID-19 swept across China. Most cities in China were locked down for weeks. Because of this, community group buying platforms boomed as they were often the only viable option for people to shop for groceries.  The total investment in this space reached over RMB 10 billion (1.3 billion USD) in 2020. And this time, tech giants such as Alibaba, Meituan, Didi and Pinduoduo joined and led rounds as community group buying became widely adopted throughout China, not just in its rural communities.

Why has this piqued the interest of Big Tech?

According to a local research institute in China, the size of the community group buying market is estimated to reach RMB 100 billion (14 billion USD) in 2022. Mckinsey estimates that the Chinese online grocery market will grow at a CAGR of 30%-50% in the next two years. 

Additionally,  community group buying could be the new growth driver Chinese tech giants have been looking for. The past few years, China’s e-commerce industry has become increasingly saturated. User and revenue growth for both Alibaba and Tencent has plateaued. Community group buying unlocked access to new consumers in the suburbs and rural areas who were previously unreachable before.

Will the Chinese government intervene?

The popularity of community group buying has created a social problem in China: millions of small locally owned grocers are going out of business as their customers shop online. On December 11th, 2020, the Chinese government published a statement that urged big tech companies to focus on developing cutting edge technologies, rather than fighting over “selling cabbages.” Many wonder if the Chinese government might outright ban companies from operating community group buying platforms if they conclude the industry is doing more harm than good.

Why should this matter to you?

The community group buying model accelerated the growth of online grocery and forever changed consumer behavior in China. There’s potential for this model to expand beyond groceries and into other categories. And as many startups around the world look to China for inspiration around new business models and consumer trends, this is certainly one worth watching.

Let’s set the stage: The Rise of New Chinese Brands

Historically, international brands like Apple, Nike and ZARA used to take over the best-seller lists of China’s Double 11. However, in the past 12 months, things have changed. According to statistics from Tmall, one of the leading Chinese e-commerce platforms, nearly 80% out of the 299 brands which made it into the 100-million-dollar-club in 2019 (brands that saw over RMB 100 million in sales revenue during Double 11) were local ones. A report published by Ali Research also indicated that the online market share of domestic brands in China has reached up to 72% in 2019.

This year, e-commerce giants such as Tmall, JD.com, and Pinduoduo even launched their own incentive programs to accelerate the development of Chinese brands. As a result, during the Double 11 period this year, 357 Chinese brands established for less than 3 years were best-sellers on Tmall. Compared to the same period last year, only 11 achieved that status. A beauty startup called “Perfect Diary” became the first Chinese brand ever to win first place in the cosmetics category, defeating all international opponents such as L’Oréal, Estée Lauder, and Lancôme. The preference for local Chinese brands over international households names, has arrived.

In a Nutshell: What Triggered the Wave?

The fundamental improvement of China’s manufacturing and brand marketing has driven this shift in consumer behavior. Chinese products have improved their quality, design and prices that have helped overcome historical resistance to buying local.

Superior online shopping experiences with native social media integration is another reason fueling consumer preferences for local Chinese products. Through digital and influencer marketing and analytics, brands can effectively reach qualified customers and deliver relevant content. Furthermore, closed borders due to the global pandemic increased the cost of international logistics, driving many Chinese companies to prioritize their domestic customers. Consequently, customers are now more likely to buy domestic products because there are more options available to them.

Last but not least, Gen Z has contributed significantly to the rise of Chinese brands. With a population of 260 million, Gen Z is now one of the main forces of consumption in China. When it comes to purchasing decisions, young shoppers are more price sensitive and value driven. Chinese brands provide products with lower costs, better quality and cultural meaning significance, perhaps explaining why Gen Z consumers chose Perfect Diary over L’Oréal, Lining over Nike, SanturnBird over Nespresso, Wang Baobao over Cerear, and Chicecream over Haagen Daz nowadays.

The shift in consumer behavior is also reflected in the capital market. In the past 2 years, many new local Chinese consumer brands have received investments from well-known VCs, such as Sequoia, Hillhouse Capital Group and Source Code Capital. For example, SanturnBird coffee and Wang Baobao cereal closed their series B round with more than RMB 100 million in funding. Perfect Diary also completed a round of financing with USD 140 million, which increased its post-money valuation to USD 4 billion, and it is now preparing to go public in the United States. We predict the wave of both consumer interest and institutional money will continue into the foreseeable future.

Why Should This Matter to You?

Besides the emerging brands in China, we have also seen some Chinese brands that have already expanded into the global market. Pop Mart, a toy company from Beijing, has successfully expanded into several Asian countries with its popular IP “Molly”. And SHEIN, a fast-fashion e-commerce platform, expanded so fast that it has already become a major competitor of ZARA and H&M. According to Google Trends, its search volume was already 3 to 4 times that of ZARA in the United States since this January.

These Chinese brands that have successfully expanded into the global markets have successfully localized their content to engage with diverse consumers. Sometimes, consumers don’t notice that the brand they are purchasing is not only manufactured in China, but branded in China as well. This certainly will keep international incumbent brands on their toes…

Let’s set the stage

It is widely believed that SARS, a prior major infectious disease that broke out in 2003, helped popularize online retail in China. Here we are 17 years later and with a blink of an eye, COVID is changing consumer behavior and influencing how nearly every industry operates. With 20M+ cases worldwide and rising, COVID, like SARS, will likely bring permanent change to how consumers consume, and businesses sell. It certainly did in China, where a growing interest in livestream e-commerce exploded as consumers stuck at home over the Lunar New Year due to COVID ached for new entertainment and satisfying remote experiences.

In a nutshell: what exactly is livestreaming?

Think QVC in 2020 — infomercials you actually wantto watch with hosts or VJs, appealing to broader, younger, savvier customers, promoting and endorsing products you’re sincerely interested in purchasing. As Bloomberg puts it, livestreaming is “part variety show, part infomercial, part group chat.”

Turns out, livestreaming is a pretty lucrative business for both merchants and sellers. Viya, China’s most well known livestreamer, is responsible for over 4.3B USD in 2019 online sales and has pocketed millions in commission. Last fall, Viya sold 15K units of Kim Kardashian’s perfume in 1 minute!

With physical retail disrupted due to COVID, a large number of businesses in China have turned to platforms that enable live selling to offset losses and partly resume business. By the end of March this year, total viewers of live selling streams reached 265 million, or over 37% of China’s total online shoppers, according to China’s Internet Network Information Center (CNNIC).

Transactions generated from livestreaming on platforms such as TikTok account for 5.5% of the overall online retail market in 2020. And this number is expected to continue to climb as users grow accustomed to “tuning in” to livestreaming video and making real time purchases throughout the program.

Livestreaming e-commcerce has significant headroom to grow — representing a single digit percent of online retail in late 2019. But with the pandemic, that’s changing…quickly. Per Technode: “iResearch predicts that by the end of 2020, China will have 524 million online livestreaming users. This means 40% of Chinese people and 62% of the country’s internet users will be livestreamers.”

Why this should matter to you?

Alan Cannistraro, the CEO and founder of Rheo (Cherubic portfolio), poses an explanation for why livestreaming is here to stay:

“text-based shopping requires your active attention and focus, but a video (or audio) stream can be left on and tuned in and out by the viewer, allowing new surfaces for shopping. Always-on screens, like TVs, Google Home, Echo Show, etc, can now run linear e-commerce experiences.”

Platforms like Alibaba have mastered this “linear e-commerce experience,” where consumers can watch, chat and purchase in one frictionless session. As of July, Amazon Live is trying to do the same. With the influencer ecosystem established and thriving on platforms like Instagram, livestreaming should have the infrastructure in place to succeed in the US.

We suspect livestreaming will play a role in reshaping how consumers remotely shop and socialize. If this trend makes its way to the US, there will be lots of new opportunities for the tech community to innovate and customize for the American consumer. Some are already developing products/platforms that help people sell via livestreaming. If you are already building tools for e-commerce merchants or influencers, it may be worth thinking about what additional features will become essential if livestreaming commerce hits home.

Time will tell if this is a fleeting trend or a fundamental paradigm shift abroad. But as SARS helped popularize online retail in China in the early 2000’s, and with COVID an order of magnitude greater in terms of societal impact, we expect live commerce will endure beyond this crisis.

In Bots World, No Interface is the Best Interface

Take “Penny” as an example. According to the iPhone app description, Penny is a personal finance app and “money coach” (yes, when you build stuff for the millennials, you must dumb down your word choice.) Just like Mint, Penny is a personal finance tool that is connected to your bank account and record your spending. The key difference is that Penny is completely integrated into a chat interface. Users don’t need to navigate in the complicated spending summary or charts. All they need to do is chat with Penny, the bot, which just feel like a real bank assistant. Users can tell Penny what they want to know by clicking on a couple predefined commands, such as “my spending graph”. Penny will even tell you things you didn’t know to ask such as: “on average, you eat out five times a week!”.

One of the secret ingredients that makes Penny so easy to use is that it limits users’ inputs and provides a guided conversation rather than allowing users to ask random questions. In the past, many companies’ approach to building a virtual assistant’s is to try to collect and analyze all the data and hope it can answer anything a user asks. However, it turns out that users are clueless about what they want or simply do not know how to use the data. This is a main reason why so many AI or virtual-assistant products have failed. Another example: Apple’s Siri. When Siri was first launched, it received lots of hype. But no one really relies on Siri to manage their daily routines today. So I think the key to such products is to provide guided conversation to deliver better user experience.

Using a fitness tracker to track your exercise and calories is nothing new.

“But imagine if a bot can tell you that you’ve only exercised 3 hours this week, which is 5 hours below your exercise goal; and then the bot recommends nearby gyms to you based on available time shown on your calendar.”

Wouldn’t that be much more useful? This is what users really need.

News company Quartz has also jumped on the bandwagon and launched a news app that basically is a bot messenger. The app literally texts you news, along with GIFs and emoji, and in the process figuring out a user’s news preference and then deliver personalized news stories to them.

The Ecosystem of Bots

Standalone bots such as Penny and Quartz app are great. But another type of bots are also gaining momentum: the messenger bots. There are many third-party bots that exist solely on large chat platforms to take advantage of platform’s massive user base. Even platforms themselves such as Facebook, Slack, WeChat are also busy building their own bots. Telegram already has thousands of third-party bots that act like widgets, performing any tasks ranging from searching funny GIFs to checking weather. Bots on Slack are much more business-oriented: such as Nikabot, which monitors team performance; birdly, which automatically aggregate travel expenses after scanning receipts; Statsbot, which analyzes data fed from Google Analytics. Bots on WeChat are usually half bots, half human, providing on-demand customer service such as booking flights, ordering food etc. Facebook by far is the most ambitious. At its developer conference F8 last year, it announced the plan to open up its Messenger appstore and started integrating with many third-party apps. Many of them are content tool, such as GIPHY, which is one of my favorite. Business tools are also a big focus for Facebook Messenger third-party services, since many businesses use Facebook as the primary tool to communicate with and acquire consumers. I think we will very soon see many “business bots” performing tasks such as help you shop or track your orders in the Facebook Messenger app.

Given the chat interface, the first wave of Bot applications are mostly built upon messenger apps. However, as more programmers delve into making bots and more open-source tools become available, I believe we will see more diverse Bot applications for a wide range of verticals, especially in the fields of IoT and IoV.

Another key reason that makes Bots so popular is that, for millennium or younger generations, most of their social interactions happen online or virtually. Once VR becomes mainstream, we will see even more activities taken place in the virtual world. Software needs to adapt to this new trend, having an “interaction” interface will be the key in winning customers.

“IoT” and smart devices have been the darling of the tech industry in the past few years. Every smart device has its own app that promises to track every details of users’ lives. But as people ponder how to integrate all these apps, perhaps the most important question is how to leverage these massive data in a way that’s meaningful and actionable to consumers. I believe bots will soon emerge as the new trend to provide data and services to consumers.