Good morning. I write this to you from my couch, eight hours deep into football Sunday. I haven’t moved since noon and I couldn’t be happier. The NFL is back.
Big welcome to all of the new members of the Crashing Up family who’ve joined since last Friday. If you’re reading this email but haven’t yet subscribed, make sure to do so here:
The Tok of the Town: Continued
A little over a month ago, I wrote about Microsoft’s potential acquisition of TikTok and why it might not be as crazy as it seems. Since then, a lot has changed. With Trump’s initial sell deadline approaching, I thought it would be best to check back in and see where the situation stands.
Who’s involved?
In the last month, a handful of new potential buyers had recently entered the arena with Oracle and Twitter (aka the guys who shut down Vine) emerging as potential candidates. Last night, it was announced that Microsoft’s bid for TikTok had been declined by ByteDance and that Oracle would be selected as the Chinese company’s “trusted tech partner.” This was fairly expected given Oracle CEO Larry Ellison’s friendliness with the Trump Administration. That being said, it is still unclear how TikTok will fit into Oracle’s existing business. Aside from its cloud related technologies, Oracle does have an upper hand in its data security. This is pretty important given the initial issue that prompted this whole ordeal.
Logically, a sale to Microsoft still made the most sense with its massive pile of cash on hand, experience in consumer tech, and its planned partnership with Walmart. Walmart had agreed to join forces with Microsoft on the deal, finding value in TikTok’s impressive recommendation algorithm which would be used for the growth of Walmart’s e-commerce business.
Just one problem…
ByteDance has announced that it won’t sell the source code of its recommendation algorithm, although whoever acquires the U.S. operations is free to develop their own. China recently put new policies on AI exports in place that would force the company to obtain a license if it transfers an algorithm to a U.S. company. Given the fact that China would rather see TikTok dissolved than sold off, no one seems to be complaining.
This is a big issue. TikTok’s recommendation algorithm is its secret sauce. There is no platform in history that has been better (and quicker) at showing you the content you want to see when you want to see it. This isn’t to say that an algorithm of this quality can’t be replicated, but it could definitely take a fair amount of time and testing to get it perfect. If this is the case, we could see a TikTok-less gap in the market for a few months which would open the door for Reels, Triller and other short-form content competitors.
All things considered, it’s an impressive feat for Oracle who now will be hosting the fastest growing social media platform and the fastest growing enterprise software company (Zoom) on its cloud. Big wins.
But wait, there’s more!
ByteDance isn’t going down without a fight. TikTok sued the U.S. government last month, challenging Trump’s executive order in hopes of delaying the date of the ban. The suit claims that the U.S. government failed to follow due process of the ban by providing insufficient evidence of a national security threat. In a rare series of events, Trump conceded and pushed the sale deadline back first to September 20th and now until November 12th.
With a phrase as vague as “trusted tech partner,” there’s still a lot to uncover here. Stay tuned.
💭Setting Your BHAGs
Of all the entrepreneurs I’ve had the opportunity to speak with, Ollie Forsyth is one of my favorites. An entrepreneur, venture capitalist and podcast host, Ollie started his first e-commerce business, Ollie’s Shop, when he was 13 years old.
“The goal of Ollie’s Shop was to target teenagers, as a place where customers could buy inexpensive gifts for the most important teenage friends and children in their lives. I really had no capital at the time to start it, so I made connections with ten suppliers all over the world and asked them to send me ten free samples of their toys.”
With a bit of negotiating, each supplier agreed and shipped him their ten free trial samples, leaving Ollie with a total of one hundred units of inventory. He sold every sample for £10 and made his first $1,500 in revenue.
Talk about bootstrapping a business.
Suffering from severe dyslexia, Ollie was severely bullied as a child. When I asked how Ollie was able to overcome these obstacles and still remain positively focused on the future, he had this to say: “BHAG”
I looked at him confused.
“Big Hairy Audacious Goal,” he said. “Goal setting is so important.”
When you’re motivated by a goal, you don’t have time to deal with any other obstacle that stands in your way.
“I have a mentality where I’m chasing my hero who’s me in five years. If you have someone to chase—it could be yourself or an inspiration—chase that person. Think about who you really want to be in five years,” he continued.
You don’t need to have only one hero. It’s encouraged that you have multiple. Success isn’t just about being the best you can be in your career. It’s also about being the best family member, friend, and role model you can be. You should aim to identify at least one hero for each aspect of your life.
Here are some of mine:
Business: Mark Cuban
Mindset: Kobe Bryant
Productivity and Time Management: Tim Ferriss
Family: Dwayne Wade
Who are your heroes and why? Let me know by replying to this email or leaving a comment below.
🧰Tool of the Week
I’ve frequently discussed the importance of owning your audience. As we’ve seen from TikTok, social media platforms can disappear as quickly as they arise. Instagram, Facebook, and Twitter will all eventually be things of the past and so will your followers on those platforms.
Building a mailing list and posting content on your personal website is the best and least risky way to capture and retain an audience. You wouldn’t build your real house on rented land, so why would you do so with your virtual home?
A few days ago, I came across LetterStack. LetterStack is a one-stop shop of resources for building, growing, and monetizing a newsletter. If you have an interest in starting your own newsletter or personal mailing list, I’d highly recommend that you give this a look.
Speaking of growing newsletters, I’m eleven subscribers away from reaching my year-end goal of 250 subscribers. In the spirit of BHAGs, I’ll now be doubling that goal to 500 subs by December 31st, 2020. If you’ve been enjoying what you’ve been reading, it would mean the world if you shared Crashing Up with your family members, friends, and co-workers and encouraged them to join in on the fun. I have a lot of cool stuff in the works and am looking forward to sharing it with you all soon!
If you’re new here and want to catch up on previous editions, here are a couple of my favorites: Live from the Bubble and A Page from Netflix’s Playbook. You can also follow me on Twitter and check out randymginsburg.com for more content.
Thanks for reading,
Randy