Breaking the four minute mile

Last week I participated in an interesting online discussion about whether Brazilian entrepreneurs should attempt to create their own innovative sites or copy successful foreign ones.

Valid points were raised by both sides and all parties put forth compelling arguments.

That said, I remain steadfast in my belief that Brazilian entrepreneurs should aspire to create their own innovative sites, rather than copying successful foreign ones.

Where my worthy opponents and I agree, however, is that there do exist, real impediments to the creation of innovative sites in Brazil.

Although there are many impediments, the greatest hurdle, in my opinion, is psychological.

No one in Brazil has ever succeeded in creating a site with global reach, therefore, in the minds of many entrepreneurs (and venture capitalists), it is impossible.

Sure, there have been successes such as Buscape, which was bought last year by Naspers for US$342 million, but Buscape is largely focused on the domestic market.

Where are the Brazilian sites which go on to become global successes like Twitter, Facebook, and Google?

In thinking about this problem, I am reminded of the famous story of the four minute mile.

For years, people believed that it was physically impossible to run a mile (1609 meters) in under four minutes.

Then, one day on May 6th, 1954, at an athletic meet between British AAA and Oxford University, a man named Roger Bannister ran a mile in 3 minutes and 59.4 seconds.

Within three years of Roger Bannister's epic achievement, 16 other runners succeeded in running a mile in under four minutes.

The psychological barrier, which had prevented otherwise gifted athletes from achieving their full potential, was broken.

That's what we need in Brazil.

We need to break our four minute mile.

Once one Brazilian site goes from startup to global success, I have no doubt that there will be multiple successes.

Then no one will be asking whether Brazilian entrepreneurs should create their own sites or copy the sites of others--because everyone will be copying Brazilian sites! :)

Comments

[Marionogueira]

Discordo. Por experiência própria, digo que o maior problema não é nenhuma barreira psicológica, mas a ausência de capital de risco no país. A começar pelo investimento em nível de angel.

Talvez a barreira psicológica seja dos investidores.

Projetos originais como Google, Twitter, Facebook, Paypal e outros jamais teriam sido financiados no Brasil.

Pra um argumento mais detalhado sobre isso, o link abaixo:

http://aceleradora.net/blog/2010/03/09/startups-brasileiras-podem-ate-copiar-mas-evoluam/#comment-40392871

[Simon Olson]

Oi Mario!

Obrigado pela commentario.

Pois e, eu acho que tem varios problemas graves, e com certeza um deles e a faulta de capital empreendedor e capital semente.

Na realidade, nao e uma faulta de capital, mas uma faulta de visao e "know-how".

Ou seja, eles ate podem ter o capital mas nao intendem como e capital semente ou capital empreendedor de verdade.

Mas, voltando de assunto, eu acho que a barreira psicologica esta na cabeza de tudo mundo, nao so os investidores.

Bem, sobre seu commentario no blog de Aceleradora, da uma olhada no debate entre eu e Yuri la no mesmo post.

Obrigado!

Um abraco,

Simon

[TropicalGringo]

Great post. I actually think that the 4 minute mile equivalent was the $342 million investment by Naspers in Buscape. That added to a market Cap over $1B of MercadoLibre (Brazil is a big component of their market), should be inserted into any startup's executive summary. While going global has obvious advantages, focusing on the Brazilian on Latin American markets has been proven to have its merits (above two examples). The example of a global player will come, but as a member of a growing club of financially successful startups coming out of Brazil. The latter is what should be promoted right now: creating more and more innovative startups where ever their target market is.

[Marionogueira]

Hi Simon,

was Akwan a copy or an original idea? ;)

[Simon Olson]

Oi Mario!

It was an original idea.

The guys who started Akwan were the guys who started Miner.

Miner was launched in August 1998.

http://sobreuol.noticias.uol.com.br/ultnot/novidade/noticias/ult220699056.jhtm

Google was incorporated in September 1998.

http://en.wikipedia.org/wiki/Google

Berthier, who was the CEO of Akwan, published the premier text book on Information Retrieval in 1999, http://www.amazon.com/Modern-Information-Retrieval-Ricardo-Baeza-Yates/dp/020139829X

I hate to say it, but you just proved my point, i.e. no one thinks of Brazilian entrepreneurs as being world leaders even when they are!

Akwan was an original idea, not a copy.

Um abraco,

Simon

[Marionogueira]

I don't believe web search engines were an original idea at all by 1998.

One could say they were copying AltaVista (1995), Ask Jeeves (1996), Excite (1994), Inktomi (1996), Infoseek, (1994), LookSmart (1995) or Lycos (1995) just to name a few.

I'm sorry but I believe that this proves my point.

Just because someone is already working on a given space it shouldn't mean that everyone else that comes after is a copycat or cannot do a far superior job a it.

A great market is a great market and there will always be many players after it just like we have Foursquare, Gowalla, Loopt and even Yelp on the LBS market.

By the way, according to Akwan's founding date, Google was founded after them. ;)

Also, Facebook came after Friendster, MySpace, hi5 and Orkut. Actually, while Facebook was only 9 million users strong, MySpace was already in the hundreds of millions.

In hindsight, every VC who passed on Facebook or Google because they were "nothing new" must regret it. I know Bessemer does regarding Google.

http://www.bvp.com/Portfolio/AntiPortfolio.aspx

Finally, what ever happened to Power.com? ;)

Abraço,
Mario.

[simonolson]

Oi Mario!

Your comment was that Akwan WAS NOT original.

My response was that Akwan WAS original.

I did NOT say that Akwan was the world's first search engine, I said that Akwan was original.

Why do I say that Akwan was original?

Because the guys (and girls) at Akwan were not looking at the US to see what the other sites did and then trying to copy them.

The guys (and girls) at Akwan were creating their own innovations and implementing them, independent of what was going on in the US.

In terms of the date that Akwan was founded, you need to read more carefully.

I mentioned Miner's founding date, not Akwan's founding date.

In terms of your comments regarding Facebook, Google, Bessemer, and Power, I don't understand their relevance to what we are discussing, though, since one consistent theme of your comments seems to be anger at venture capitalists, I can only assume that perhaps you are trying to goad me?

But to answer your question, unfortunately, I didn't have the opportunity to see the Facebook or Google deals when they were looking for investment, so I don't know what I would have done, but I can tell you that I did everything that I could to invest in Power and would do so again if given the opportunity.

Why?

Because Power was the most talented team I have ever come across in Brazil.

Power has since migrated to the US and is now based in San Francisco.

Although the company has changed direction and almost all of the original team members have since left the company, many of them have gone on to form some of the most exciting startups in Brazil today.

So, I don't think that there is anything to be ashamed of in relation to Power whatsoever.

As a matter of fact, I have been meaning to write a blog post about Power calling them the Netscape of Brazil.

Another cool thing about Power, no one would ever accuse them of trying to copy a US site.

Out of all the Brazilian startups that I have had the pleasure of working with, they came the closest to creating a startup with global reach.

If they had been successful with the original strategy, they would have broken the four minute mile.

Um abraco,

Simon Obs. If you get the chance, please try to read the post that I linked to on the Aceleradora blog. Do you see the way that Yuri and I address each other in the comments? He and I vehemently disagree with each other, yet we do so politely and with respect. It is possible to disagree with someone without resorting to ad hominem attacks and I would even go as far to say that you will be a happier person because of it. Thanks!

[Marionogueira]

Hey Simon,

If I insulted you in any shape of form I'm really sorry about it and I would gladly take back whatever made you feel like that. It wasn't my intention at all.

On the other hand, it just bugs me the way you so categorically label startups that are not the first mover on their respective markets in a pejorative fashion.

So, Akwan didn't know about or didn't care for what all those people were doing in the US years before them and that's a plus?

Fine, it's great that they were trying to find their own way of doing things but how could you possibly know that all of the so called copycats aren't trying to do the same?

Regarding Facebook, Google, Bessemer and whatnot, I was saying that, although one could have easily labeled them as copycats by your standards (as Bessemer did), they proved to be amazing companies and superb investments.

Sometimes, a given market can be addressed in only so many ways, with some variation. But that variation carries the differentiation.

And it doesn't mean that founders on these markets are just trying to be like X but with a twist. Maybe their visions are original and had nothing to do with X's implementation. Maybe the similarities are apparent because the market is still very early.

Ten blue links as search results is what you get from most search engines (Google admittedly got that from AltaVista). Personal profiles are common to every single social network mechanics. Activity streams are a fixture of every web app nowadays.

So it's completely unfair to go as far as to promptly call startups within a given space copycats simply because they weren't first movers or because one doesn't know their ultimate vision.

And it's quite insulting too, specially if you take into account all the almost insurmountable hardships entrepreneurs have to bear to bootstrap in Brazil with very little or no support (and I don't mean capital alone).

Finally, you couldn't be more mistaken about my take on venture capitalists. Now that felt like ad hominem. If there's something consistent about my remarks on the subject it's how much I regret that there are so few of them in Brazil as of now.

About Power, I'm a happy that you're happy about it. =)

Cheers.

[simonolson]

Oi Mario!

No problem, I am happy that we are getting to the real issue.

In terms of me having a pejorative view of non-first movers, it is not so much a pejorative view as it is a personal preference: innovative companies get me excited, copies don't.

So, for example, lets say that I like chocolate ice cream and you like vanilla ice cream.

The fact that I like chocolate and you like vanilla doesn't mean that you are wrong and I am right, it just means that I prefer chocolate and you prefer vanilla.

If you read the comments that I wrote on Yuri's blog, you will see that I was careful to say that people should do whatever makes them happy and if they want to make domestic copies of foreign sites (or some iteration thereof), then they should do so.

My personal preference is for what you are referring to as first-movers (it is actually a little more complicated than this, but for the sake of clarity, lets keep it simple), but that doesn't mean that I am "right", it is just what gets me, personally, excited.

The reason that I prefer first-movers over copies is because I think that we (Brazilians) are capable of creating sites on par with any foreign site, so why should we copy them?

Similarly, I am personally uninterested in projects that involve outsourcing to Brazil.

My rationale is, why should we do someone else's piecemeal labor?

Our engineers are just as good as theirs, so we should be doing our own innovative projects, not someone else's low-end work.

Finally, the intellectual challenge of innovative companies interests me, whereas copies don't.

But again, this is a personal preference.

If someone likes to do copies, then they should go for it!

There are great entrepreneurs and engineers who specialize in copies, like Alec Oxenford of OLX.

The fact that he is doing a copy doesn't make him any less of an entrepreneur or engineer, it is just his personal preference.

At the end of the day, you have to focus on opportunities that get you excited.

Thanks!

Um abraco,

Simon Obs. By the way, your English is excellent!

[Marionogueira]

Hi Simon,

Well, thanks. I'm sure that learning such an arcane language as Portuguese is a lot more of a challenge and yours it just fine as well.

Regarding our discussion, it seems we agree more than we disagree on this subject and our disagreements appear to be more of a matter of semantics than anything else.

I tend to agree with you if we're talking about actual copycats although I also believe Yuri had very valid points on the opposite direction as well on his post.

I guess that the problem is how one knows when a startup is a true copycat or not. That's why I was talking about Google and Facebook.

It seems to me that it also applies to Akwan via-à-vis all those pre-existent search engines.

These three companies could have been labeled as copycats of others who already seemed poised to dominate their respective markets when they were launched.

It wasn't until later on that the original visions of their founders became transparent to outsiders through their products evolution.

Google's PageRank and big investments on innovative infrastructure software that spawned a new paradigm for the field. Facebook's news feed and application platform. Akwan's secret sauce that convinced you that they actually had a unique vision for search.

All these things couldn't be known to outsiders who could have classified them as mere copycats.

By the way, that ice cream flavors reasoning reminded me of a scene of the movie "Thank You For Not Smoking". ;)

Cheers.