I BUILD COMPANIES.



About Me

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Hi, I'm Adil Wali. I became a Microsoft Certified Professional at age 14, started my first web development company, and never looked back. Since then, I've been a founder, advisor, and investor to a number of startups in the world of Fashion, e-Commerce, and Education Technology.

TEAMS

I BUILD THEM

Nothing is more important than the team of an early-stage company. I’ve spent most of my career thinking about how to structure the most successful teams.

PRODUCTS

I ENVISION THEM

Gone are the days when winning was about ‘being able to build something.’ Today, the holistic user-experience matters more than everything else. I am addicted to it.

SYSTEMS

I ARCHITECT THEM

I’ve been fortunate enough to be part of amazing companies and projects that have scaled quickly. I’ve learned a tremendous amount of scaling systems gracefully and how to prioritize tough technical tradeoffs.

STRATEGY

I CRAFT IT

When I first started building companies, there weren’t so many people doing it. Today, the hyper-competitive landscape and reduced barriers-to-entry make strategy a requirement to building a lasting business.



COMPANIES

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I start, advise, and invest in companies. I believe in starting one company at a time. I don't invest very much. When I do, I look for companies that I can impact through advisorship.
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Thoughts

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I write for me; not for you. I'm not a huge fan of pontificating. Most of what I write here is to solidify a lesson-learned or to clarify my coalescing thoughts.
  • When Are We Going to Learn?


    Cryptocurrency is supposed to be decentralized

    Getting it all wrong

    When Satoshi first wrote the Bitcoin whitepaper in 2008, she challenged the banking system as we know it.  She draws reference to the inherent weaknesses of the trust-based model.  The whole point was to build an ecosystem and economy that operated without these trusted third-parties. Yet, here we are, 10 years later, bastardizing that vision with gusto.

    The dichotomy in our response, as a community, is quite curious.  On one hand, we seem to understand these are really big ideas that have the potential to change banking and retail as we know it.  This explains the total market cap of crypto being about $425 billion as of Feb 25, 2018.  Yet, on the other hand, it appears as though a supermajority of digital currency users now use centralized exchanges like Poloniex, Coinbase, Bitfinex, Bitstamp, etc.

    Our collective lack of technical depth coupled with growing interest in the space has led many crypto enthusiasts to these trusted third parties.  Further, cash is still king in business, and these folks have made a lot of cash.  And, smartly, they’ve reinvested it in the form of massive marketing budgets.  Bitfinex is the trusted third-party to about 60,000 BTC worth of cryptocurrency trade daily. GDAX and Bitstamp, follow close with about 22,000 BTC and 16,500 BTC worth of crypto trade daily, while Kraken and HiBTC facilitate about 5,800 BTC and 5,200 BTC worth of crypto trading daily (chart above).

    We’re not actually better for it

    Perhaps the most ironic thing about digital currencies is that our misguided use of these centralized approaches does not actually result in that great of a user experience, as evidenced by:

    1. A hugely significant amount of money that has been stolen from centralized exchanges.  (More on this below.)
    2. Some exchanges experiencing massive slowdowns during peak times.  (Some caused, at least in-part, by congestion in the underlying networks of Bitcoin and Ethereum.)
    3. High trading volumes, or not being able to keep up with growth, leading to downtime on major exchanges.

    The reason not to rely on trusted third-parties is that of all the ways in which our reliance on them can hurt us.  Yet, here we are, getting hurt.  It’s almost as if today’s users of digital currencies would be perfect posterchildren for Satoshi’s 2008 whitepaper.

    The notion of privacy in crypto has also largely been a broken dream.  And that’s at the protocol level.  It does not even take into account how much we’ve made things worse with our centralized pattern of adoption.  Coinbase being subpoenaed for the personal information of 14,355 holders by the IRS only adds insult to injury in this respect.

    Centralization from the get-go?

    ICOs are centralized too!  In almost every case, those investing in an ICO are all buying from a central company or organization that they seemingly trust.  This is a far cry from the way Bitcoin was originally built and launched into the community.  First, we had a whitepaper.  Next, we had working software.  Finally, we had the creation of value.  No one bought bitcoin from Satoshi LLC after she posted the whitepaper online for the first time.

    Bitcoin was launched in a pure way, with people organically growing the network on proven technology before ascribing value to it.  Yet, here we are, investing in ICO after ICO, many of which have no technological progress-to-date.  We’re not banking on a community or a network at these early decision points, but instead a central organization with an idea.  The all-time cumulative ICO funding total stood at $8.74 billion according to CoinDesk as of February 19, 2018, with Telegram ($850 million), Filecoin ($262 million), and Tezos ($232 million) being the largest fundraisers.

    2017 alone witnessed 342 ICOs raising about $5.4 million. The year 2018 has already seen 92 ICOs till date, with $3.1 million being raised. So, just two months into the year and we’re already recorded 57% of 2017’s total raise.

    How much pain is too much?

    Apparently, the cost of trusting these third-parties is significant.  Billions of dollars have been stolen from exchanges since Bitcoin launched in 2009 with almost zero accountability on the part of the exchange in nearly every instance. Here’s a quick view of what centralization has cost the cryptocurrency community since its inception:

    When using the total market cap as a denominator, it appears that we are less safe with crypto than we were with old-fashioned money.  Perhaps that shouldn’t be surprising, given that our collective behavior since this revolution started has been antithetical to its premise.

    Where do we go from here?

    I’m left wondering why.  Why would we all believe in this game-changing vision with such fervor, and then proceed not to operate by its ethos?  Maybe decentralization isn’t the killer feature of these technologies, after all.  Maybe it is, and the community does not value it enough to actually use it.  Maybe we just don’t like to practice what we preach.  While those would be easy answers, they ring hollow to me.  

    Perhaps it’s that the usability of these decentralized technologies … leaves a lot to be desired.  Let’s face it, blockchain is pretty unapproachable.  Especially to folks who do not count themselves in the technical elite.  Whether we’re talking about cold storage of your private keys or the fact that you are sending money to a 34-character alphanumeric string that you better not mistype, lest you lose your money.  

    So maybe, just maybe, there’s hope.  Maybe we understand that decentralization is actually important.   And, we’re just waiting for the usability of fundamentally decentralized approaches to actually get better.  And, when it does, we will better align our actions with our beliefs.  The alternative is a lot worse: our behavior is simply based on a fundamental misunderstanding of these technologies and their value.  This would dangerous for all of us that believe in this technology and want it to win.  So I, for one, am holding out hope that it’s the usability.  

    References:

    1. Cryptocurrency market capitalization data as available on CoinMarketCap.com
    2. ICO data from CoinDesk’s ICO Tracker <https://www.coindesk.com/ico-tracker/>
    3. Cryptocurrency exchange average trading volume data from Bitcoinity.org <https://data.bitcoinity.org/markets/exchanges/USD/6m#rank_desc>
    4. Andrea Tan and Yuji Nakamura, 2018, Bloomberg L.P. <https://www.bloomberg.com/news/articles/2018-01-29/cryptocurrency-markets-are-juicy-targets-for-hackers-timeline>
    5. Cheang Ming, 2018, CNBC <https://www.cnbc.com/2018/01/28/coincheck-nem-hack-unlikely-last-for-cryptocurrency-space-analyst.html>
    6. Frank Chaparro, 2017, Business Insider <https://www.businessinsider.in/Some-of-the-biggest-crypto-exchanges-are-shutting-out-new-users-because-they-cant-keep-up-with-demand/articleshow/62272509.cms>
  • Are free returns right for your customers?


    It’s one of the big questions that every online retailer faces – should we be offering free returns?

    Whether or not free returns are even viable for your business is, of course, specific to your business model, but I can guarantee that they’re something you should investigate.

    Why? Because customers care.

    According to the 2015 UPS Pulse of the Online Shopper survey, 57% of shoppers consider paying for return shipping an issue, making it easily the number one issue encountered. 62% of shoppers consider return policy an important aspect of selecting whether and where to buy products at all.

    In an earlier ShopRunner/Harris Interactive survey, 81 percent of survey respondents stated that they were less likely to make more purchases from sites that charge for return shipping. This tallies with the findings of a study published in the Journal of Marketing (emphasis mine):

    “customers who paid for their own return decreased their postreturn spending at that retailer 75%–100% by the end of two years. In contrast, returns that were free to the consumer resulted in postreturn customer spending that was 158%–457% of prereturn spending.”

    This insight arms us with a conclusion that is not inherently obvious: a free return policy is so appealing to consumers that the process of going through it actually encourages repeat business.

    This makes sense – a consumer friendly return policy (especially once successfully used) creates a bond of trust between a retailer and customer. The customer now believes that the risk associated with making purchases from the retailer is inherently lower. So they have the emotional leeway to order more, feeling secure in their ability to easily return products they’re unhappy with.

    Why not offer free returns, then?

    Despite all the data pointing towards the benefits of free returns, only 22% of the online retailer’s assessed by the UPS study offer free returns.  There are a number of reasons for this.  First, certain retailers simply aren’t capable of offering these benefit, including low margin sellers who are competing on price alone or companies selling especially heavy or difficult-to-ship items.

    Another reason is that many online retailers continue to internally stigmatize consumers making returns as attempting to game the system.  Making returns too easy could open the door to borrowing activity.  Imagine buying clothes or a videogame for a one-time-use and attempting to return them once you’re done. While this may be the case for a minority of your customers, the insight from the above study suggests that offering free returns actually increases the amount of spending that takes place, making up for losses incurred from serial returners.

    The case for free returns in your business is ultimately predicated on the product you sell. Apparel, for instance, can see significant gains via a free return policy as consumers feel free to try out new styles or fits. Asos, for instance, goes so far as to ship their clothing in re-sealable packaging, encouraging returns, while Zappos was perhaps the original pioneer of the free online returns trend, offering shoppers an entire calendar year to change their minds.

    When it comes down to it, deciding whether or not to offer free returns is an investment in your customers. You shouldn’t do it simply to “keep up with the Jones’s.”  You should do it because it makes sense for your business and your customers.  Dive into your own data and keep an open mind.  My guess is that you’ll find some kind of friction-reducing tactic around orders and/or returns to be worthwhile.

  • When should you take your retail business global?


    You’ve got an awesome website.  A phenomenal product.  Loyal customers.  A growing domestic business.

    The next major question you are likely to ask yourself is: when should I start selling globally?

    The allure of a global market is simple – for businesses successfully cornering a domestic market, expanding beyond their borders opens up a nearly unlimited supply of new customers, capital and talent. In addition to increasing revenue, global markets can extend the lifespan of existing products and reduce dependence on a single market.  This reduction in dependence is particularly important when it comes to insulating from the risk of localized adverse economic conditions.

    So, given how easy it easy to articulate the benefits of going global, why doesn’t (or shouldn’t) everyone do it? The short answer – it’s complicated. From different cultural norms to foreign regulations, going global can get complex fast.  That’s not to mention the costs associated with an increase in supply chain complexity and new employees.  Expanding globally takes a sense of focus and purpose that not every company is interested in or capable of.  

    Perhaps the first and most important question to ask yourself as a store owner is this:  am I really ready to take the plunge into a running a global business? Here are some factors to consider:

    • How much organic traffic do you get globally? If your organic global traffic numbers have you feeling like you’re leaving potential customers on the table, you may well be operating in a segmented well-suited to go global. Not getting foreign visitors? It’s not the end of the world, but you’ll need to do your research and make sure global markets want what you’re selling.  Further, you will want to validate that you can do it better than the companies operating there now.

     

    • How many orders do you get? There’s no magic number here, but are you still growing in your domestic market? If you’re part of a small team with upwards sales growth at home, adding the employees necessary to make international expansion a success might be more complicated than meaningful.  You can always consider going global later.

     

    • How much control do you have over the supply chain? This relates to a number of other logistics factors that you’ll need to consider before deciding to expand internationally: Do you produce your own product?  How heavy is your product? How challenging will your product be to ship in customs? What is the holding cost of your product? Make sure you have a strong grasp of your domestic shipping capabilities. Whether through a third-party logistics provider or in-house, shipping globally adds complexity every step of the way.

     

    Once you’ve determined that you have potential international customers, a business capable of supporting global business complexity, and a shipping/logistics model capable of handling overseas orders, you’re ready to start putting together your strategy for going global. Be prepared for a rocky road – it’s not easy to take a business you know well into new waters.  That said, with enough research and a solid plan, it’s the best way to ensure diversified growth into the future.

    Check out part II in this series for advice on forming your global strategy and tips for making your international rollout a smooth one!



Contact Me

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Location // San Francisco, CA | Seattle, WA | New York, NY

Phone . // (415) xxx-xx63

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