“It’s my job to be intellectually curious,” says Spark Capital Partner Megan Quinn. That curiosity helps when it came to breaking down 4 huge startup opportunities in 15 minutes. Joining Startup Grind in Europe, Quinn dove into messaging & conversational UI, autonomous driving, and the future of work under an important hypothesis: the mass app economy is dead.
With hard earned product and leadership experience from Google, Square, and Genentech, Quinn entered the venture capital world as an early stage investor at KPCB. As General Partner of Spark Capital Growth, Quinn works with growing consumer companies like Clover Health. Here's her take on what's next.
Rise of the Next Platforms
Remember the early days of Internet startups? Quinn does: in the 1990s, tech founders were bringing the offline online. Real life activities like shopping became eCommerce, banking and payments migrated to the web, and even photo albums and family videos were “eaten” by Photobucket and YouTube.
It’s 2016, and we’re well into the third wave: transforming app experiences into the lowest friction transaction possible. What does that look like? Like ordering groceries by asking Amazon’s Alexa to handle it, like ordering an Uber from a chat on Facebook Messenger, or like booking travel with Lola.
“One of the most prescient evolutions,” Quinn says of the overarching trend, “is from a world in which there’s an app for everything… to there being a few very central platforms that are integrating other products and services extremely tightly.”
The way Uber built on top of the iPhone and the App Store, forgoing a web product entirely, the next billion dollar business may be built on top of Uber - or Messenger, or Slack, or Snapchat. In this integration, China has already taken the lead with WeChat.
Whether through integration with apps that have already earned their spot on your home screen, or by depending on something as simple as texting or talking, the key trend to watch is simplifying input.
Innovation Driving Forward
Another huge opportunity is in the biggest technology investments being made by 74 million Americans this year: a car. With Spark Capital’s exit of autonomous vehicle company Cruise Automation for “north of $1 billion,” demand for self-driving technology companies has exploded.
Though regular consumers still need convincing to bet their lives on the machine, “it’s much easier to get people comfortable with autonomous trucking,” suggests Quinn. These vehicles “take straight shots” and aren’t anywhere close to children or pedestrians. Here, the next company to watch is Otto Motors, automating in-state and cross-country land freight.
According to Quinn’s private equity contacts, auto companies are ravenous to snatch up these autonomous driving firms.
Betting on The Future of Work
With an expected 40% of millennials entering the gig economy by 2020, the nature of work is going to look very differently - very quickly. “How do you support that type of worker in a world used to a paternal organization that took care of everything for you?” asks Quinn.
By looking at all sides of the equation: Spark Capital is thinking about the physical spaces behind designed by companies like WeWork, the tools enabling remote work like Slack, and the major gig marketplaces like Lyft or Gigster.
The big opportunities here remain in finance and insurance, in providing stability to workers without the support of a classic occupation. For a great example, look to Even, which helps contract employees smooth out spiky wages in times of feast and famine.
OK, but What’s the Catch?
You knew there’d be a catch, right? “It’s hard to build a very significant business when you don’t have a direct relationship with your customer,” says Quinn of building on platforms. To access an opportunity in cars or bots, you’ll inevitably build on the work of another business, and “the services of these apps [will] touch users through a third party" - making you susceptible to a GM firmware update or a homegrown competitor from Facebook Messenger.
“The question for me as an investor and for entrepreneurs: how do you retain the relationship to the customer when you are being served to the customer through a third party?” If you’ve got an answer to this question, you’re probably in business: say hello to Megan on Twitter and catch our full interview below.