Tuesday, January 8, 2013

In Silicon Valley, designers emerge as rock stars

By Gerry Shih


SAN FRANCISCO | Originally published Fri Apr 13, 2012 4:36pm EDT

(Reuters) - Five years ago, Justin Edmund arrived at Carnegie Mellon University, a floppy-haired freshman, with artistic talent and dreams of joining a venerable design firm like IDEO or Frog. But during his sophomore year, a recruiting pitch from a Facebookemployee turned his head, and prompted a detour of his ambitions.

"It didn't even occur to me that working at a tech company was something I could do," Edmund said. "I switched my trajectory completely."

So, in 2010, Edmund interned on Facebook's burgeoning design team, and, after graduation, landed a job at Pinterest. There, at just 21, he has played a central role in building the virtual scrap-booking site into one of the hottest startups on the Internet.

Edmund isn't alone. Inspired by the legacy of Steve Jobs and lured by the promise of the current tech boom, young designers are flocking to Silicon Valley, where they're shaking up a scene long dominated by engineers and programmers.

The new breed of "user experience" designers - part sketch artist, part programmer, with a dash of behavioral scientist thrown in - are some of the most sought-after employees in technology. Entry-level interactive designers at startups are commanding salaries easily topping $80,000, almost twice the median pay for primarily print designers of about $45,000, according to a recent survey by the American Institute of Graphic Arts.

IN-HOUSE TALENT

Top venture capital firms, from Google Ventures to Andreessen Horowitz, are hiring in-house designers to help the young startups in their portfolios. One angel investor has even established a Designer Fund to identify startups driven by design talent.

To feed demand, new digital design programs have sprouted over the past two years, at both eliteengineering universities such as Stanford, and art schools like the California College of the Arts. The School of Visual Arts in New York has seen applications for its digital design program soar by 43 percent since its inception in 2009.

Indeed, the flourishing of digital design reflects the Valley's evolution, entrepreneurs and investors say.

In the latest generation of innovation, heavily concentrated in applications for mobile devices and social networks, and relying on ever-cheaper cloud-computing services, success depends not on whiz-bang technology, but rather, on a subtle sense of how to make features useful and engaging.

The most recent example is Instagram, the slick photo-sharing app that was snapped up by Facebook earlier this week for $1 billion. The 12-person company's founding duo includes Kevin Systrom, who majored in Management Science and Engineering at Stanford, and Mike Krieger, who describes his background as "Human-Computer Interaction and User Experience."

"There's a growing recognition that it's critical for a company's first employees to be people with great design sense," said Eric Feng, founder of Hulu and Erly, an evite- and photo-sharing company, and a former partner at venture capital firm, Kleiner Perkins Caulfield and Byers. "That's true even if you look at larger companies like Google and Facebook, who have moved in that direction."

To be sure, engineers still occupy a rarefied perch at the top of the Silicon Valley hierarchy, and are the target of the fiercest recruiting battles.

VISUAL APPEAL

But even Facebook, famous for a culture that glorifies the "hacker way," now talks of integrating "design thinking" into its products and has steadily beefed up its design studio.

From her team's brightly-colored studio in Facebook's Menlo Park offices, design chief Kate Aronowitz dispatches designers who are paired with an engineer, a product manager and sometimes a researcher to conceive new products or improve features such as user profiles or messages.

The embrace of design starts at the top with CEO Mark Zuckerberg, who has stressed the importance of building a crack design team, Aronowitz said.

In a highly competitive recruiting climate, it's not uncommon for even Facebook to encounter top design talent playing hard to get. For the toughest cases, Aronowitz plays her trump card: She asks Zuckerberg to place a personal phone call.

"When they're not returning my email, that tends to work," said Aronowitz, who herself was poached by Zuckerberg from LinkedIn in 2009. "I'm lucky to have that in my back pocket."

The spotlight fell squarely on the design team last November, when Facebook credited Nicholas Felton, one of its data-visualization experts, with conceiving the Timeline interface which has become one of Facebook's most significant overhauls in recent years.

For fledgling startups, it's even more critical to understand how design affects user behavior, said Dave McClure, an angel investor who cited the example of Mint, an online tool for managing personal finances acquired by Intuit in 2009.

Jason Putorti, the startup's designer founder, lent the Mint interface "much more warmth," which was crucial for a startup that dealt with sensitive information, McClure said. Design, he added, "made the app feel trustworthy, comforting, functional."

Last year, McClure put down money to create the Designer Fund, a program that identifies entrepreneurs with strong design backgrounds and offers seed money and mentoring from experienced founders like Putorti and Chad Hurley, of Youtube. The fund, headed by Enrique Allen, a 25-year old graduate of Stanford's design school, has partnered with more established venture investment firms like Khosla Ventures, Andreessen Horowitz and Kleiner Perkins.

"We're reshaping a lot of how you build a company," McClure said. But, he added, "there's still a resource and talent shortage" for interaction designers.

SCOUTING FOR ARTISTS

Finding exceptional design talent, though, is not a simple matter. Last year, Kalvin Wang, the co-founder of Ridejoy, a service that arranges carpools, said he spent several "incredibly hard" months recruiting an interaction designer.

Dirk Cleveland of Riviera Partners, a Silicon Valley headhunting firm, said startups have trouble finding a design "unicorn" - the rare designer with the interactive digital skills that many app startups require.

"It's literally the toughest position to fill right now," Cleveland said. "That equation of supply and demand is out of balance. Engineering education has progressed, and startups have learned to do more with limited resources, but I don't think that's the case for design."

Even though he sifted through 150 resumes, Wang said, "There are so many startups and so many tech companies that are snapping them up. It's slightly ridiculous."

Ridejoy interviewed candidates from Toronto, New York and the Midwest, and ultimately hired a Parsons School of Design graduate living in Omaha.

"You do really have to look outside Silicon Valley," Wang said. "For Bay Area designers, they have literally hundreds of options and they're going to work at a place where they know people, or a big name like Google."

The sizzling job market hasn't escaped the notice of design schools across the country.

Liz Danzico, founding director of the School of Visual Arts' masters program in Interaction Design, said the original goal was simply to understand where the new innovation economy field was going. "Experience is now the material, not ceramic or plastic," she said.

Still, Danzico expected most graduates to stay in New York — the traditional hotbed of design. She was "really surprised" to find, in a survey of her first graduating class, that almost half ended up on the West Coast at companies including Apple, Facebook, Twitter and Yelp.

Meanwhile, at Carnegie Mellon, Kelly Lau-Kee, a junior industrial design major, said "there's huge buzz generated by the students, the employers, even the professors" about the prospect of work in Silicon Valley.

On any given day, Lau-Kee said, she'll spot pictures on Facebook and Instagram shared by friends currently employed by startups. They paint a heady picture of life in California, of snazzy workspaces, hip coworkers and sunshine spilling into every frame.

"A lot of people like the mentality of work and play, which the startups advertise really well," she said. "It's a culture we really want to check out."

Wayne C. Chung, the chair of Carnegie Mellon's industrial design program who taught Edmund, the young star at Pinterest, said the new economics of the profession was evident on college grounds. Traditional design firms, buffeted by the last recession, have noticeably cut back on recruiting, while tech companies have maintained a visible presence on campus, he said.

After this semester, Chung expects another sizeable contingent of his graduates to make their way West to Silicon Valley.

"In their hearts and eyes," Chung said, "they don't see anything else as nearly as exciting.

Saturday, January 5, 2013

China’s Momo Raises $40M for Casual Meetups

originally published August 28, 2012 Red Herring Editorial Team

Casual meetups in China are challenging in a culture where dating game shows are an apt way to snatch up a wealthy groom and marriage qualifies as a get-to-know-you conversation starter. Translated as “Hi, stranger” in Mandarin, Momo recently nabbed an impressive $40 million Series B round for its location-based casual encounter app, as first reported by Sina Tech.

Rumors abound that Alibaba was part of the round, though the Chinese venture firm declined comment to TECHINASIA.

The round places the company’s value at over $100 million.

Launched only a year ago, the app already has 10 million users, boasting 2.2 million daily active users and processing 40 million messages a day while adding another million users every month.

Dating in China is a challenge in a culture where men vastly outnumber women. People in Chinese culture tend to be shyer about making those early, casual connections. Sites like Jiayuan and Baihe have a popular following, but focus on connections that lead to marriage. Momo touts itself as more casually friendly, setting up dates for a single night or a few days. The company does claim that its services have inspired a few weddings, however.

Safety concerns abound, of course. Last June, a 32-year-old man was sentenced to eight years in jail for raping seven women he had connected with using Weixin, a general purpose messaging app, according to PandoDaily. Still, as Momo’s fast traction indicates, those concerns are not enough to keep the average Momo user under lock and key, watching TV with their mothers.

At its current traction, Momo is poised to hit 15 million users by the end of this year, and it’s safe to say many of those users won’t be only using the service to schedule their next tea tasting.

Company Overview of Softbank China Venture Capital

January 05, 2013 3:25 PM ET

Softbank China Venture Capital is a venture capital arm of SOFTBANK Corp. specializing in early, growth/expansion, late venture, pre-IPO stages, and first round of financing investments. The firm primarily invests in media, healthcare, cleantech, new materials, food packaging, medical treatment, new media, manufacturing, agriculture, and retail sectors. For the information technology sector, it seeks to invest in the internet, e-commerce, communications, and communication technology. For the consumer sector, the firm prefers to invest in consumer products. It typically invests between $500,000 and $10 million in its portfolio companies. The firm is generally the lead investor and seeks to acquire between 20 percent and 30 percent stake in companies post-financing. It provides incubation facilities in various parts of China to provide internet start-ups with funding, executive leadership, strategic partnerships, IT infrastructure, and operating services necessary to ensure a successful launch and orbiting. The firm's partners provide venture capital for promising Internet and e-Commerce companies. Softbank China Venture Capital was founded in 2000 and is based at Shanghai, China with additional offices at Beijing, China; Suzhou, China; Tianjin, China; and Taipei, Taiwan.

Asian Stocks Post Seventh Weekly Gain on U.S., China Data

By Jonathan Burgos & Eleni Himaras - Jan 4, 2013 1:29 PM PT Bloomberg News

Asian stocks rose, with the regional benchmark index posting its seventh weekly advance, after the U.S. Congress passed legislation on a budget deal and manufacturing reports from China and the U.S. added to signs of a global recovery.

Li & Fung Ltd. (494), a supplier of toys and clothes to Wal-Mart Stores Inc., jumped 7.3 percent in Hong Kong. Rio Tinto Group, the world’s second-largest mining company that gets about 31 percent of sales from China, gained 3 percent in Sydney as Chinese manufacturing expanded for a third month. Fairfax Media Ltd. surged 14 percent amid speculation billionaire Gina Rinehart and investor John Singleton may seek control of the newspaper publisher.

The MSCI Asia Pacific Index gained 1.8 percent to 131.89 in its seventh weekly advance, the longest such winning streak since March last year. The Nikkei 225 Stock Average jumped 2.8 percent yesterday in Japan’s first trading day of the year, closing at the highest level since March 2011. The MSCI Asia Pacific Excluding Japan Index (MXAPJ) rose 2 percent this week.

“The global economic outlook is improving,” Shane Oliver, Sydney-based head of strategy at AMP Capital Investors Ltd., which has almost $130 billion under management, said. “That will underpin further gains in share markets along with very easy monetary conditions. That probability of the fiscal cliff and a U.S. recession has been taken out.”

Australia’s S&P/ASX 200 Index gained 1.1 percent this week. South Korea’s Kospi Index (KOSPI) added 0.8 percent. Taiwan’s Taiex Index rose 1.4 percent. Hong Kong’s Hang Seng Index climbed 2.9 percent.

China Recovery
The Shanghai Composite Index (SHCOMP) advanced 2 percent. A gauge of China’s manufacturing on Jan. 1 showed a third month of expansion in December, adding evidence that the recovery in the world’s second-biggest economy will extend into the new year. The nation’s services industries expanded at the fastest pace in four months, an index showed yesterday.

The regional benchmark MSCI Asia Pacific Index (MXAP) surged 14 percent in 2012 as central banks from the U.S., Europe, Japan and China took action to spur economic growth. The Asia Pacific gauge traded at 14.1 times average estimated earnings, compared with about 13.2 times for the Standard & Poor’s 500 Index and about 11.9 times for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

Exporters advanced as manufacturing in the U.S., a major market for Asian companies from carmakers to electronics manufacturers, expanded in December. The U.S. Congress passed budget legislation, breaking a yearlong impasse over how to head off automatic tax increases and spending cuts. Failure to resolve the so-called fiscal cliff might have dragged the U.S. economy into a recession.http://www.bloomberg.com/news/2013-01-04/asian-stocks-post-seventh-weekly-gain-on-u-s-china-data.html

Japanese Buys $1.76 Million Tuna to Beat Hong Kong Rival

By Anna Mukai & Yuki Yamaguchi - Jan 5, 2013 7:00 AM PT Bloomberg News

Kiyomura K.K., a Tokyo-based sushi chain, paid a record 155.4 million yen ($1.76 million) to outbid an affiliate of a Hong Kong-based rival for a tuna it said would be enjoyed by Chinese and Japanese customers alike.

The fresh whole tuna weighed 222 kilograms (489 pounds) at the market’s first auction of 2013 yesterday. The price compares with the 56 million yen Kiyomura paid last year to take an auction Itamae Sushi Japan K.K., an affiliate of the Hong Kong- based Taste of Japan Group, won the previous year.



Kiyomura paid a record 155.4 million yen ($1.76 million) for the fresh whole tuna weighing 222 kilograms (489 pounds), sold at the market’s first auction of 2013. Photographer: Noriyuki Aida/Bloomberg

Kiyomura could lose as much as 154 million yen on the purchase, based on the estimated 15,540 yen it paid for each piece of sushi and the minimum 128 yen it charges per serving. The chain’s president said last year it made the record bid to ensure the fish was won by a Japanese following the March 11, 2011, earthquake. This year, amid heightened geopolitical tension with China, President Kiyoshi Kimura said he expected people from both countries to partake.

“There are some political difficulties, but Japanese customers and Chinese customers come to our restaurant, and what we want is for everyone to enjoy our sushi,” Kimura said in an interview at his Tsukiji restaurant after the 5:30 a.m. auction. He said that while his bid was “expensive,” the company would serve the auspicious fish at regular prices.

By 3:30 a.m., bidders had begun arriving at the warehouse- like tuna auction building to inspect the fish. Two hours later, at the ring of a hand-bell, traders started thrusting arms up, hands signaling the amounts of their bids. Seconds later, the deal was done for the year’s first tuna.
Global Pace

Auctions at Tsukiji, the world’s largest fish market that stretches over an area the size of 43 football fields, influence prices all over the world, according to Sasha Issenberg, author of “The Sushi Economy.”

“It’s like a combination of Wall Street and Sotheby’s in the art market and a commodities trading floor,” he said.

Itamae had bid as much as 151 million yen for the fish, Makoto Kondo, a spokesman for the Hong Kong-based sushi chain, said by phone yesterday. He also said the company’s intention was to share the fish with Japanese customers.

“Until last year, we took the tuna to our customers overseas, but we really wanted to deliver it to the Japanese people, so the fact that we lost is very unfortunate,” Kondo said.

The bluefin, caught off the coast of Japan’s northeastern Aomori prefecture, will be carved into about 10,000 pieces of sushi, Kimura of Kiyomura said.
Fish Country

Japanese eat more fish per capita than any other developed country, consuming about 56.7 kilograms (128 pounds) annually, compared with a global average of 17.1 kilograms, according to the United Nations Food and Agriculture Organization.

The winning bid for tuna at the first auction of the year at Tsukiji averaged about 14.5 million yen over the past 10 years, according to the Tokyo Metropolitan Central Wholesale Market website. Daily trading volume at Tsukiji averaged about 1.55 billion yen in 2011, according to Hiroshi Mochizuki, a spokesman for the market.

Tsukiji, where visitors gather as early as 4 a.m. Tokyo time to observe competing buyers using hand signals to bid at tuna auctions, is listed among Japan’s most popular attractions by the Japan National Tourism Organization.

The Tokyo Metropolitan Government has delayed plans to relocate fish market to neighboring Koto Ward by a year as soil decontamination at the new site is taking longer than expected, the Nikkei newspaper reported Dec. 31, 2012.

Tensions between Japan and China escalated last year after Japan nationalized a set of South China Sea islands claimed by both countries.

To contact the reporters on this story: Anna Mukai in Tokyo at amukai1@bloomberg.net; Yuki Yamaguchi in 東京 at yyamaguchi10@bloomberg.net

To contact the editor responsible for this story: Paul Tighe at ptighe@bloomberg.net

Friday, January 4, 2013

China's investment in UK will be 'explosive'

Updated: 2013-01-04 07:56
By Ding Qingfen in London (China Daily)

High-end products, infrastructure are targeted sectors, diplomat says

China's investment in the United Kingdom will continue its "explosive" growth, with high-end manufacturing and infrastructure leading the way, a senior diplomat predicted.

"The UK is the most open economy, and also the most market-oriented," in Europe, said Zhou Xiaoming, minister counselor of the Chinese embassy in the UK.




Chinese companies have been answering the call from some members of the European Union for capital. In 2011, the UK was the third-largest EU destination for Chinese investment, following Luxembourg and France, according to the Ministry of Commerce.

China's overseas direct investment in the UK in 2011 was $2.5 billion, it said.

But Zhou said the real figure was far more as Chinese overall investment in the UK experienced "explosive" growth.

"It is estimated that the Chinese capital that flew into the country in 2011 reached $6.5 billion," said Zhou.

And the momentum will probably be sustained in the coming years, he said.

The past year also saw some key mergers and acquisitions.

In May, Shanghai-based food and beverage group Bright Food agreed to pay $1.7 billion, including debt, for a 60 percent stake in UK cereal maker Weetabix.

Reports in December said China Gas Holdings agreed to buy London-listed Fortune Oil's gas business in China for $400 million.

"Chinese capital mainly went to the service, energy, food and mining industries," said Zhou.

And "high-end manufacturing and infrastructure will be hot spots" for Chinese companies, he added.

Executives of China Investment Corp, a $410 billion sovereign wealth fund, have repeatedly said that the company will seek infrastructure deals in the UK.

They agreed to buy a 10 percent stake in Heathrow Airport in October.

This follows closely on the fund picking up a stake in Thames Water last year.

"We could say the UK is the most open market worldwide, especially in the infrastructure sector, and this means huge business for China," said Zhou.

From 2011 to 2015, the UK is expected to need capital worth about $325 billion for the infrastructure sector, he said.

As a country that is proud of innovation and design, the UK is a "good place" for Chinese manufacturers to set up research and design departments, Zhou said.

"We have already seen some domestic manufacturers establish their R&D centers in the UK," he said.

Last summer, the Chinese fashion brand Bosideng made its first foray abroad, opening a flagship store in London's West End. The company makes its products in the UK.

"The top brands in the world are in London and Bosideng is here to learn from them and to build itself into a luxury brand," said Zhu Wei, CEO of Bosideng Corp UK.

"We have got the best local designers to join us," he said.

"The UK is the land of thinkers. Chinese manufacturers could learn a lot when they are here," Zhou said.

To further boost investment, the UK is about to introduce Patent Box legislation.

This will come into effect in April 2013 and aims to encourage more companies to invest in patents, research and development through cutting taxes and providing incentives.

GDP growth in the UK in the third quarter was the strongest since the third quarter of 2007. But the Bank of England has said the fourth quarter is likely to see a contraction.

The UK suffered its second recession since the financial crisis between late 2011 and mid-2012.

Economists predict that a pickup in the economy is not likely in the immediate future.

Since the financial crisis, China's ODI has been on the rise and Europe has become an increasingly hot destination.

Since the beginning of 2011, China has conducted 32 mergers and acquisitions throughout Europe, valued at about $15 billion. The deals were mainly in the high-tech fields.

But Chinese proposals and investment deals have been frequently hindered by restrictions in some European nations.

The EU said last year it has been collecting evidence for a potential anti-dumping or anti-subsidy case against Huawei Technologies Co Ltd and ZTE Corp, the world's leading makers of wireless telecom equipment. This follows a report in the US that the companies were a potential security risk. This allegation was categorically rejected by both companies.

"Fortunately, the policy and regulations here are transparent and well made. More importantly, there are no investment restrictions in the majority of sectors except for military projects and the media industry," said Zhou.

dingqingfen@chinadaily.com.cn

Graph: China's growth in total lending since '08


The value of new loans is consistently rising in China, attracting the attention and action from the central bank. And wisely so, as the rapid pace of growth in loans threatens to blow out inflation, and potentially create overheating and asset bubble issues. But cultural and regulatory factors have dictated a relatively lower use of debt (as compared to e.g. the US). So lending growth may well be key factor in rebalancing China's economy - the key is getting it done sustainably, and avoiding the excesses demonstrated by the US experience.

Sources:

1. National Bureau of Statistics www.stats.gov.cn
2. National Bureau of Statistics www.stats.gov.cn & People's Bank of Chinawww.pbc.gov.cn
3. People's Bank of China www.pbc.gov.cn
4. National Bureau of Statistics www.stats.gov.cn
5. People's Bank of China www.pbc.gov.cn

Article Source:
http://www.econgrapher.com/top5graphs23oct.html