Udacity spins out self-driving taxi startup Voyage

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One example of how fast the field of AI is moving: Udacity’s “school for robo-cars has been so successful that it’s now spinning out of Udacity into its own company, Voyage.” Here’s a snippet from Business Insider:

(…snip…) The new spin-out will be lead by Oliver Cameron, a Udacity VP that was spearheading a lot of its self-driving car curriculum. The company broke the news to its employees Wednesday morning.

Udacity will have a stake in the newly-formed company as part of the deal, said the Udacity’s CMO Shernaz Daver. Voyage also recently closed a seed round of funding that included Khosla Ventures, Initialized Capital, and Charles River Ventures.

Voyage has been hot in Silicon Valley investor circles because of one big name linked to Udacity: Sebastian Thrun. Thrun, who founded the education startup, is also nicknamed the “Godfather of self-driving cars” for the work he did at Google and helped launch the self-driving car nanodegree program at Udacity.

Thrun, though, says he’ll have no connection with Voyage even though it’s spinning out of his company. “Because of personal conflicts, I have excused myself from any involvement in Voyage. I wish Oliver and his team all the best,” Thrun said in a statement to Business Insider.

The autonomous taxi startup wants to bring about the end goal where autonomous cars can carry people anywhere for a very low cost, Cameron said. It already has permission to deploy its self-driving cars to ferry passengers in a few places over the next few months, but Cameron declined to specify where.

“We want to deploy these not within five years, but very soon. We think in terms of weeks, not in terms of years or months,” he told Business Insider in an interview.

Pure guess: one reason Oliver Cameron decided to take this risk is because Udacity is open-sourcing it’s own self driving car project. All the code is there for all of us to use and improve. Including the new startup Voyage. And Oliver Cameron has a pretty good idea how successful the Udacity project is going to be.

Update: this week BMW has announced they plan to ship self driving cars in four years, in 2021. That’s similar to plans already announced by GM, Ford, Chrysler, Mercedes, Volvo and Chinese ride-sharing giant Didi Chuxing.

Marc Andreessen: why Bitcoin matters


What technology am I talking about? Personal computers in 1975, the Internet in 1993, and — I believe — Bitcoin in 2014.

This may not be the best essay on Bitcoin, but it is definitely the best essay that I have read. Because I respect Marc Andreessen I pay attention when he decides to write publicly. And when I see that Andreessen Horowitz has invested nearly $50 million in Bitcoin-related startups, that gets my completely focused attention.

Media coverage typically talks about much the value of a Bitcoin has risen (or fallen). Or how Bitcoin is a vehicle for buying drugs and guns. I think you will better understand the significance of Bitcoin by thinking of a fraud-free VISA payments system with nearly zero fees and no minimum transaction. That creates possibilities. Once the infrastructure is in place Bitcoin will enable many possibilities that are way beyond a no-fee VISA. Here’s just one of Marc’s many cases: Remittances. The hard-working people who picked your strawberries are sending cross-border remittances to their family. A big chunk of the funds sent (order of magnitude 10%) is lost to bank-fees and funds-transfer agents. A Bitcoin-based payment system will drop that 10% fee to nearly nothing. That will have a huge impact on the workers’ welfare.

Andreessen summarizes why Silicon Valley is “all lathered up”:

The practical consequence of solving this problem is that Bitcoin gives us, for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate.

What kinds of digital property might be transferred in this way? Think about digital signatures, digital contracts, digital keys (to physical locks, or to online lockers), digital ownership of physical assets such as cars and houses, digital stocks and bonds … and digital money.

All these are exchanged through a distributed network of trust that does not require or rely upon a central intermediary like a bank or broker. And all in a way where only the owner of an asset can send it, only the intended recipient can receive it, the asset can only exist in one place at a time, and everyone can validate transactions and ownership of all assets anytime they want.
Bitcoin is an Internet-wide distributed ledger. You buy into the ledger by purchasing one of a fixed number of slots, either with cash or by selling a product and service for Bitcoin. You sell out of the ledger by trading your Bitcoin to someone else who wants to buy into the ledger. Anyone in the world can buy into or sell out of the ledger any time they want — with no approval needed, and with no or very low fees. The Bitcoin “coins” themselves are simply slots in the ledger — analogous in some ways to seats on a stock exchange, except much more broadly applicable to real world transactions.

The Bitcoin ledger is a new kind of payment system. Anyone in the world can pay anyone else in the world any amount of value of Bitcoin by simply transferring ownership of the corresponding slot in the ledger. Put value in, transfer it, the recipient gets value out, no authorization required, and in many cases, no fees.

That last part is enormously important. Bitcoin is the first Internet-wide payment system where transactions either happen with no fees or very low fees (down to fractions of pennies). Existing payment systems charge fees of around 2 percent to three percent — and that’s in the developed world. In lots of other places, there either are no modern payment systems or the rates are significantly higher. We’ll come back to that.

Bitcoin is a digital bearer instrument. It is a way to exchange money or assets between parties with no preexisting trust: a string of numbers is sent over email or text message in the simplest case. The sender doesn’t need to know or trust the receiver or vice versa. Related, there are no chargebacks — this is the part that is literally like cash — if you have the money or the asset, you can pay with it; if you don’t, you can’t. This is brand new. This has never existed in digital form before.

Bitcoin is a digital currency, whose value is based directly on two things: use of the payment system today — volume and velocity of payments running through the ledger — and speculation on future use of the payment system. This is one part that is confusing people. It’s not as much that the Bitcoin currency has some arbitrary value and then people are trading with it; it’s more that people can trade with Bitcoin (anywhere, everywhere, with no fraud and no or very low fees) and as a result it has value.

If you give your attention to Marc’s essay for 30 minutes I think you will understand why his firm is actively seeking Bitcoin-related opportunities. Oh, I hear that Amazon will launch a Bitcoin payment window soon. Just kidding, but think about how skinny Amazon’s margins are – and the impact on profits when the 2 to 3% credit card fee goes to 0.01% for purchases by Bitcoin customers. Think about the network effects when Amazon starts accepting Bitcoin.


Observations From A Tipless Restaurant

We found this to be a very interesting first person perspective. Things are not what they seem in tipville:


4) Our ability to make sure team members in all parts of the house were taken care of, and to remove tip-related squabbling from our business, gave us a huge competitive advantage in the marketplace; this in turn allowed us to serve a much higher quality of food and take lower margins on it. Basically, it was because of the much-lower-friction monetary flow through the company that we were able to survive as a true, deep farm-to-table restaurant in San Diego for so many years. Other operators in town, fully aware of how tips poison restaurants, knew we were enjoying an edge. Some of colleagues resented this, and lashed out in some ways, including that of telling local journalists and bloggers that we were lying about the food we were serving. I assume that this is because those restaurants couldn’t serve the kind of food we did and still take tips, because tips are so wasteful. And if they couldn’t do it, than they assumed/said we weren’t doing it.


Tim Draper on “competitive governance”: Dr. Seuss and the Bee Watcher-Watchers

This morning I listened to Tim Draper at Stanford Entrepreneurial Leaders. Good talk, especially on DFJ experience with international investments. Near the end, after discussing challenges in Russia and Ukraine, he talks about “competitive governance”. And sadly the US is not competing – to be a desirable place to launch new ventures or businesses. He used the Dr. Seuss “The Bee Watcher” analogy. Draper said at 27 minutes, loosely paraphrasing:

We used to be clearly #1 country to do business in and now #4 and it seems to be dropping. This is one of the reasons (shows Dr. Seuss). The bee works really hard, and the bee-watcher wants to find out how that bee has been so productive, so he sits and watches the bee. But they don’t believe the bee-watcher, so they bring in the bee-watcher-watcher to watch the bee-watcher.  Now, we are the bees. The US used to have about 8% of the economy involved in watching the bee watchers – or 1 bee watcher-watcher for every 12 bees. Now we are at 45% (overhead), about one bee watcher-watcher per bee, and this seems to be a systemic bad trend. See what you can do about that guys…

Money Making Scheme

Scott Adams posted an enchanting entrepreneurial opportunity. If you decide to build this business I suggest that it is only fair that you reserve 5% of the initial shares for the benefit of Scott – he certainly deserves the commission. And 5% for Seekerblog for the finders fee.

I have an idea for making lots of money but I’m too lazy and frightened to do it myself. The idea is to become a consumer advocate against a confusopoly. A confusopoly is any group of companies in a particular industry that intentionally confuses customers about their pricing plans and products. Confusopolies do this so customers don’t know which one of them is offering the best value. That way every company gets a fair share of the confused customers and the industry doesn’t need to compete on price. The classic examples of confusopolies are phone companies, insurance companies, and banks.

To get things rolling, you pick a confusopoly to target and you build a web page explaining the problem. Then you collect signatures of support. and demand legislation to standardize how prices are presented to customers. Then you wait for the lawyers and lobbyists from your targeted industry to pay you to go away.

It seems entirely legal to lobby the government for regulatory reform. And I’m not aware of any law preventing companies from paying you to leave an issue alone. Perhaps they’d need to do it in some sort of stealth manner, just for PR purposes. I could imagine, for example, that one of the companies would offer you a job trying to organize a simpler pricing scheme, which is exactly what you’re asking for. You’d work for a few years, get no cooperation from anyone in the company, fail miserably at your task, and collect a big paycheck. If you work from home, the failing will be far more efficient, requiring no more than a few emails and some unreturned phone calls. You could do the whole thing in your pajamas, start to finish.

As always, I don’t recommend taking advice on anything important from cartoonists.

[From Money Making Scheme]

How to (In)validate Your Startup Idea

This is $10,000 value advice for those thinking of launching a web startup, by the founder of WePay:

(…) Sometimes you can’t PAY somebody to use your product, let alone get them to pay you for it. It’s probably good to know that before you decide to quit your day job.

(…) If these recommendations are too extreme, treat them as a thought experiment. Just don’t lie to yourself.

A quick (but BIG) caveat: there are VERY notable counter-examples. I think they generally fall into three categories:

Products that solve a problem that people don’t know they have (or one that they can’t articulate), but offer a solution that is so compelling and elegant that it can overcome this obstacle: Dropbox.

Read the whole thing »

Paul Graham: How to Make Wealth

Here is another wonderful Paul Graham essay, this one is from 2004:

(…) If you wanted to get rich, how would you do it? I think your best bet would be to start or join a startup. That’s been a reliable way to get rich for hundreds of years. The word “startup” dates from the 1960s, but what happens in one is very similar to the venture-backed trading voyages of the Middle Ages.

(…) This is why so many of the best programmers are libertarians. In our world, you sink or swim, and there are no excuses. When those far removed from the creation of wealth— undergraduates, reporters, politicians— hear that the richest 5% of the people have half the total wealth, they tend to think injustice! An experienced programmer would be more likely to think is that all? The top 5% of programmers probably write 99% of the good software.

(…) Someone graduating from college thinks, and is told, that he needs to get a job, as if the important thing were becoming a member of an institution. A more direct way to put it would be: you need to start doing something people want. You don’t need to join a company to do that. All a company is is a group of people working together to do something people want. It’s doing something people want that matters, not joining the group.

(…) Startups are not just something that happened in Silicon Valley in the last couple decades. Since it became possible to get rich by creating wealth, everyone who has done it has used essentially the same recipe: measurement and leverage, where measurement comes from working with a small group, and leverage from developing new techniques. The recipe was the same in Florence in 1200 as it is in Santa Clara today.

Understanding this may help to answer an important question: why Europe grew so powerful. Was it something about the geography of Europe? Was it that Europeans are somehow racially superior? Was it their religion? The answer (or at least the proximate cause) may be that the Europeans rode on the crest of a powerful new idea: allowing those who made a lot of money to keep it.

Once you’re allowed to do that, people who want to get rich can do it by generating wealth instead of stealing it. The resulting technological growth translates not only into wealth but into military power. The theory that led to the stealth plane was developed by a Soviet mathematician. But because the Soviet Union didn’t have a computer industry, it remained for them a theory; they didn’t have hardware capable of executing the calculations fast enough to design an actual airplane.

In that respect the Cold War teaches the same lesson as World War II and, for that matter, most wars in recent history. Don’t let a ruling class of warriors and politicians squash the entrepreneurs. The same recipe that makes individuals rich makes countries powerful. Let the nerds keep their lunch money, and you rule the world.

When It’s Darkest Men See the Stars


…While companies execute business models, startups search for a business model.

I recommend this optimistic post by serial entrepreneur and Stanford prof. Steve Blank. If you are thinking of launching a startup…

(…) It may be that all the doomsayers are right.

But I don’t think so.

Let me offer my prediction. There’s a chance that the common wisdom is very, very wrong. That the second decade of the 21st century may turn out to be the West’s and in particular the United States’ finest hour.


Over the last ten years, entrepreneurs began to understand that startups were not simply smaller versions of large companies. While companies execute business models, startups search for a business model. (Or more accurately, startups are a temporary organization designed to search for a scalable and repeatable business model.)

Instead of adopting the management techniques of large companies, which too often stifle innovation in a young start up, entrepreneurs began to develop their own management tools. Using the business model / customer development / agile development solution stack, entrepreneurs first map their assumptions (their business model) and then test these hypotheses with customers outside in the field (customer development) and use an iterative and incremental development methodology (agile development) to build the product. When founders discover their assumptions are wrong, as they inevitably will, the result isn’t a crisis, it’s a learning event called a pivot — and an opportunity to change the business model.

The result, startups now have tools that speed up the search for customers, reduce time to market and slash the cost of development.

(…) The Entrepreneurial Singularity

The barriers to entrepreneurship are not just being removed. In each case they’re being replaced by innovations that are speeding up each step, some by a factor of ten. For example, Internet commerce startups the time needed to get the first product to market has been cut by a factor of ten, the dollars needed to get the first product to market cut by a factor of ten, the number of sources of initial capital for entrepreneurs has increased by a factor of ten, etc.

And while innovation is moving at Internet speed, this won’t be limited to just internet commerce startups. It will spread to the enterprise and ultimately every other business segment.

Amazon Prime

… is one of the more brilliant marketing ideas. Brad Stone explains how Prime came to be and the huge impact on Amazon profits:

Amazon Prime may be the most ingenious and effective customer loyalty program in all of e-commerce, if not retail in general. It converts casual shoppers like Tinsley, who gorge on the gratification of having purchases reliably appear two days after they order, into Amazon addicts. Analysts describe Prime as one of the main factors driving Amazon’s stock price—up 296 percent in the last two years—and the main reason Amazon’s sales grew 30 percent during the recession while other retailers flailed. At the same time, Prime has proven exceedingly difficult for rivals to copy: It allows Amazon to exploit its wide selection, low prices, network of third-party merchants, and finely tuned distribution system, while also keying off that faintly irrational human need to maximize the benefits of a club you have already paid to join.

(…)  “In all my years here, I don’t remember anything that has been as successful at getting customers to shop in new product lines,” says Robbie Schwietzer, vice-president of Amazon Prime and an eight-year veteran of the company.