Tesla Galleries as Lean Dealers

Perhaps I’m missing something.

With regard to the issues being argued around Tesla’s direct-to-consumer sales model and the legality of such – while the concerns of auto dealers (profitability, sales guidance, and service facilities for customers) have merit, the lower maintenance architecture of all-electric vehicles do give rise to the need for new “thinking” in terms of the models that manage and regulate the related activities and processes.  The point of this post though is NOT to argue those merits, but to suggest what seems a relatively straightforward solution for Tesla.

 

State laws at issue appear to prohibit the sale through other than an independent intermediary. It is not unusual for companies to have exclusive contractual arrangements which also include many other stipulations.  In that regard, would it not be a reasonable solution for the “galleries” through which it displays and facilitates remote-purchase of its vehicles to be independent, to have territorially exclusive ability to non-electronically “show” the product, in exchange for being bound to strict operating requirements.  And included in such contract could be the payment by Tesla of the operating costs they would otherwise spend on the Galleries had they been owned by Tesla – protected by the operating requirements (which may be subject to revision yada yada yada).

 

Perhaps this is too naive as an outsider perspective, but in essence, the facilities would be light-weight and lean virtual art galleries with physical examples as well.   Disruption is sometimes mostly in mindset.  In looking at the requirements (on the Motor Vehicles pages of a few states – for example NJ or VA) there are specific requrements, but they do not seem insurmountable (NJ requires TWO vehicles) relative to what may already be in place in an existing Tesla Gallery.

 

 

 

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• Tesla gets another 2 weeks+ to sell cars in New Jersey as NYTimes comes out against getting banned in New York
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Transplanting the Bike Share’s Brain

Bicycle stand (Photo credit: Superburschi)

Having spent much of the last year focused on  startup work, analysis, and angel investing, I wanted to briefly outline a focal point of the efficiency technology segment that I gravitate toward.  In particular, the most interesting opportunities revolve around existing activities that contain friction and inefficiency, and where the markets and providers seem comfortably numb –  and where entrepreneurs with a blend of critical and strategic thinking have seen beyond existing models and methods.

By evaluating issues facing each of an engagement’s constituencies, and re-thinking the engagement mechanisms of the activities involved, revisions for reducing or eliminating friction can be made to the processes so as to also elicit valuable inputs from participants, unlock additional value — even for bystanders, and/or open doors for new constituents.  Entrepreneurs and companies who are doing this with a vision for what lies beyond initial disruption are the ones that really pique my interest.

A great example lies in one of my earliest individual angel investments (outside of the Soundboard Angel Fund that I am involved with — which also subsequently invested). The company is Social Bicycles  (a.k.a. SoBi), led by Ryan Rzepecki.  Their focus at this point is in the bikeshare space, which is generally outlined pretty well in this article.   Some of the key issues around bikeshares (beyond those for the operator, such as reliability/repair/maintenance, loss of bikes, and fleet management and flexibility) tend to involve: ability for users to locate bike availability where they want it, and importantly, knowledge that there is space at their destination station to receive their bike.  This is due in large part to bikeshares generally being “station” based.

 

Citi Bike Share (Photo credit: ccho)

Such station-based systems have their “smarts” in the kiosk and rack assemblies that hold the bikes.  Once you take a bike from such a system, you’re on your own until you bring it back into the system by parking it in another of the system’s smart racks.  Obviously, the destination rack won’t always be at the exact location you’d like to go to, and when you arrive at the one closest to your destination, it may well be full — meaning you have to find another of the system’s racks in order to park/return it.  Chances are, particularly if you’re using the bike for commuting purposes, you don’t have a lot of time to hunt for a parking space, nor do you have the flexibility to show up late because you were doing so.

 

In contrast, (and not to oversimplify all that Ryan and Social Bicycles have done), SoBi has shifted the smarts and locks, from residing within the rack system to the bikes themselves, integrating GPS into the bikes, and using the cloud for procurement — and in so doing, they’ve evolved bikesharing to an un-tethered state.

Bike stands, Toronto, Can (Wikipedia)

This means you can pull out your smartphone and find the bike closest to you, reserve it before you get there, unlock it on arrival, and take it wherever you want to go, without worrying that there might not be a space at your destination because, while they prefer you lock it to a designated regular old bike rack, in a pinch you can lock it to a tree or parking meter (local rules allowing).

With reduced infrastructure requirements, other added benefits of this revised approach include significantly lowering the cost of entry, not to mention lowering the hurdle for any necessary approvals.  The cost per bike is about a fifth that of a station-based scenario, and can be eased into and adjusted relatively flexibly in response to what is learned in regards to demand and patterns through operation.

There are many other details to this particular system, and there are many other realms to which this approach of constituency analysis is unlocking real value.  In future posts, I plan to share more about some of the other companies I have found to be doing this good work.

(SoundBoard Angel Fund is a democratic fund, with members active in selection and analysis of companies and in ongoing relationships with its portfolio, which is primarly focused in education, consumer products and services, and efficiency technologies).

Related articles

• Is Hoboken’s Bikeshare Better Than Ours? (gothamist.com)
• No Docking Stations Required (wnyc.org)
• Social Bicycles Brings Sharing to Two Wheels (blogs.wsj.com)
• Deconstructing New York’s Bike-Share Freak Out (theatlanticcities.com)
• Bike Sharing: As Convenient and as Frustrating as Everything Else (brooklynspoke.com)
• NYC’s bike share, largest in nation, launches (metronews.ca)
• Largest Bike Share Program in America Launches in NYC (slog.thestranger.com)
• Hoboken Bike Share Starts In June (newyork.cbslocal.com)

 

January 2015 related article: http://raisethehammer.org/article/2447/my_first_experience_using_hamilton_bike_share

 

 

 

 

 

Used MOO for cards – here’s a discount

Image by massdistraction via Flickr

We recently used Moo to get some really nice self-designed cards made, and were really happy with the quality.

Here’s a 10% discount you can use as a new customer, if you like – the equivalent of entering TPX88K as a promo code in the checkout process.

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• My Moo cards, individual photo business cards (paganum.wordpress.com)
• moo business cards have landed! (adventuresoftheordinary.wordpress.com)
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• Moo Cow. I Mean, Card. Yeah. Moo Card. (weddingbee.com)
• Take a peek behind the scenes at MOO (moo.com)

 

EV Plan and Update to Oregon mileage-tax post

Image via WikipediaAs an update related to my earlier post on the Oregon idea for a mileage tax in place of the gasoline tax:  Here’s a case where the model of cost-per-mile could actually make sense – but not as a road-maintenance related tax.  Instead, this furthers the green and energy independence aspects that the mileage tax would discourage.  In this case, the cost per-mile concept underlies a quicker shift by consumers to electric vehicles.  Better Place is working on transforming the auto market to work more like the communications industry, where the consumer pays for service/minutes – in this case miles.  In doing so, it looks to shift a major expense factor of EVs to being acquired over time – not altogether different from the way we buy fuel for our gas powered cars over time – not all at once.  (I’m calling the auto industry under this scenario the “commutications industry.”)

In addition to looking to make charging ports ubiquitous, for topping-off the battery whenever parked, the concept  involves battery swapping stations, whereby drivers would pull in when they need a fill-up, and rather than charging the battery that is in their car, a hot one would be swapped in on the fly – in the time that it would take for an ordinary gas fill-up.  The batteries in this case would not be owned by the consumer, but would be part of the subscription or service plan.

Circling back to a point that I made in the earlier post – different cars have different levels of economy/efficiency – so owners of lower economy cars should bear some added cost, beyond just per-mile.  This can’t just be a matter of how much juice is used, since some batteries will have better retention / performance – and these being the property of the company… (well, you get the point).

Service can manifest in a range of ways – from people getting the service for a car they themselves purchase, to cars being provided as part of the service (much like a free phone provided under a phone service plan).  Interestingly, Better Place is also pushing governments to require participants in this market to comply with standards – so from the beginning, there won’t be competing standards (e.g. HD vs Blu-ray) which could delay our reaching energy independence by slowing adoption while people wait to see which standard would take.

None of this solves Oregon’s road maintenance revenue issue.  In fact it underscores the problem.  Increasing the gas tax, though, would keep the pedal to the metal (so to speak) in driving (pun intended) out gas engines there.  If the Better Place service providers do master mileage metering however,  that could address the technical issues behind the proposed tax, and serve as a substitute once the gas guzzlers are all gone.

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Better to align interests

Image via WikipediaLast week, I read a story about an idea being considered in Oregon — to move from a gas tax to a mileage tax, to offset losses in road repair revenue as a result of there being more cars with better fuel economy.  As Oregon Rep. Peter DeFazio, a member of the House Transportation and Infrastructure Committee, put it:   As cars burn less fuel, “the gas tax isn’t going to fill the bill“.

Many may think this seems like an interesting idea, and that even if I did live in Oregon, it wouldn’t impact me very much.    Those of you who are of the value network persuasion will likely recognize, right away, the counterproductivity this move would represent.  For me, this idea makes little “cents” (pun intended).

Here we are pushing “green”, and acting as if we recognize the impact we’ve had on our environment.  And along comes a complicated and expensive approach that seems to perpetuate what I call “long-term short-sightedness”.

Sure, such a tax could serve to counter the revenues being lost as a result of cars having better fuel economy – but at the cost of creating a disincentive to  progress and participation we’ve made on the environmental front?

Perhaps not the best alternative, but simply increasing the overall fuel tax, rather than a system that offsets an incentive to “do your part” (at least the part of increased economy), seems a better way to attack the problem – assuming that the problem is simply the reduced revenue.

Another alternative, related to suggestions that the real tartet here is congestion, or at least congestion at certain times of the day, would be to implement tolls – or an EZPass type system for an automated approach.  This would “tax” the road use at issue and could be a more efficient approach from an infrastructure standpoint – and one that doesn’t deter what some people are doing to reduce costs/emissions.

Sure, I’m an outsider in this particular case (by about 2,750 miles), and yes, I’ve likely oversimplified the situation, but in addressing new problems, doesn’t it make the most sense to consider all the moving parts and various objectives that we’re trying to satisfy with our actions?

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