Security issues with promiscuous devices

I spend a lot of time with connected device companies. Their rise over recent years can be attributed to many things, including the evolution of Bluetooth (and the omnipresent Bluetooth Low Energy). Suddenly, a plethora of objects could be tied to your phone. Data moves easily and you’ve got the remote control in your hand. But unless it’s been layered with security, you’ve potentially exposed a gaping hole into your device ecosystem.

I recently hung out with an electrical engineer named Matt. Before we got together one evening, he was at an IoT meetup where a hot hardware startup demo’d its product. The presenter turned on the device, tried to link to it via Bluetooth, and found he couldn’t. Matt knew there’d be a few seconds where anyone could pair and he jumped in. He later called the device promiscuous. That’s because your Bluetooth devices will hook up with anybody. He had his fun, de-paired, and let the presentation continue.

This 2006 throwback is very relevant to the conversation.

Following the presentation, he approached the speaker. He told him there was a security flaw with the product. The founder disagreed. The device was already paired to the speaker, so Matt hit it with a DDOS attack. The attack forced the Bluetooth component to re-start. It would normally re-pair with the original controller, except he jumped in and grabbed it again. Matt is smarter than me. I have no idea how he did this on the go.

This has implications. I can connect to BLE devices from a decent distance. I think 10 meters? And what are your walls made out of? You probably don’t live in a Faraday cage and I can probably see your devices on my own. Is there a chance your device is also connected to your router? Or another device? Is there a group of devices working together? So walking by your apartment, I can spam your one BLE device, reset it, pair, and potentially dive into your whole connected network.

Security holes like this can put your whole house at risk.

A reflection on 9/11 from The Happiest Place on Earth

My Aunt works at Disney MGM theme park in Security. So I knew that WDW was considered a prime terrorist target. So I said to my husband, Matt: “We need to get out of the Magic Kingdom. This could be hit next.”

As conversations on 9/11 often do, talk turned towards events of that day. Everyone has a story, and my “I was in Disney World” almost felt like an insult to New Yorkers. Until I read this piece from the HuffPo called “What Was It Like at Walt Disney World on 9/11.”

While it won’t compare to the terrors of other New Yorkers, reading that article made me comfortable sharing my own experiences.

How I ended up in Disney World during the first week of school

My dad hated waiting in lines.

We’d go to the AMC on Friday nights. It always had a line wrapped around the corner. He consistently walked to the line’s elbow near the ticket windows and cut. He knew none of the teenagers would say anything. “Lines are to keep stupid people waiting.”

Another prime example? We visited FAO Schwartz while I was in grade school. There was an hour-plus uncuttable line. My dad’s response was to find the exit located in the car dealership next door. He told me to fidget (not a challenging task for me now or then). We waited for 10 minutes, he approached the security guard who no doubt saw us waiting, and told them my mother was inside. We needed to page her. BOOM, in.

My dad knew the Disney World crowds. He returned time after time to torture himself in lines just to watch his kids freak out with happiness. Once, he booked a trip during the first week of school. There were no lines. After all, who pulls their kids from class right when school starts? My parents, that’s who. We were only going to Disney during the first week of school ever again. My dad, mom, brother Joe, cousin, and I flew down sometime after Labor Day.

We checked into the Swan Hotel. My dad worked mornings and joined us in the afternoons at the parks. We got on all the major rides with less than 5 minutes wait. My dad was joyful. Except for the newest ride, Test Track. That had over an hour wait. No worries, we would tackle it during our final morning.

September 11th

We were scheduled to depart that evening. With one final day on our multi-park passes, we had a game plan. Dad worked. We went to Epcot for Test Track, Magic Kingdom for rides and shopping, and the airport for home.

At 26, Joe had recently moved to NYC for a job at the Bank of New York. His office was located in the Financial District. Around 9:10, my brother’s phone rang. For the past 20 minutes or so, his friends frantically tried to get through and confirm he was okay. Standing outside Test Track, that’s how we learned planes had hit both World Trade Center Towers. Thankfully, Joe was with us. His building would eventually be severely damaged. Joe was spared much of the trauma his coworkers faced because of that day.

We went back to the hotel. My dad had on CNBC or CNN or some other news channel. They all repeated the same stories about acts of terror and general confusion. He said there was no point in sitting there listening to that. We may as well head to Magic Kingdom.

Joe and my mom wanted to shop while my cousin and I wanted to hit all the rides again. Our plans were to meet for lunch at Liberty Tavern then make our way back. We jogged to Tomorrowland and found the entrance to Space Mountain barred by Disney workers. After some intense private discussion, they let us through. We raced down the barren corridors, no lines to be found. At the loading area, something unexpected happen: the lights came on.

The Evacuation

Workers herded us towards the doors. They said “Due to unforeseen circumstances, the Magic Kingdom was closing.” Some people knew the reason, many did not. I read it described the atmosphere was calm. I disagree. Maybe people weren’t sprinting, but they were disquieted, uneasy, confused. As for us, we were separated.

We sprinted to Liberty Tavern. The area was empty. We ran towards Main Street where we witnessed a mass exodus of the park. I climbed benches and street lamps, hoping to catch a glimpse of Joe or my mom. We were small enough to run between people, but no luck. We were alone.

We exited the park and walked towards buses leaving for the Swan, figuring worst case we could find them at the hotel. In line for the buses, we found my mom and brother. My mom cried and we were all relieved. By now, everyone knew terrorists attacked New York, Washington, and something about Pennsylvania. People openly speculated about Disney being next. There was crying and some hysterics. People panicked, saying avoid the monorail, avoid the boats. They’re just bigger targets. Why else would Disney evacuate if they didn’t expect us to be hit next? Relief gave way to fright.

It was a tense ride back to the hotel. But no one attacked Disney that day and we arrived safely.

The Aftermath

That’s the meat of the story.

Flights were grounded. We were stuck in Disney, a dream for most kids. Hotels didn’t charge guests for extra nights, didn’t charge for food, and created activities for us. I vividly remember playing games in their arcade for hours while it rained. The parks re-opened. We didn’t go, but reportedly they were eery. My dad grounded his team, told them all to spend time with their families and be safe. My brother tried to get status updates on his coworkers and work in general. Cell phones were largely useless.

After a few days, we made the decision to drive home. We rented a car and I complained endlessly. I didn’t want to make a 20 hour drive and acted like a shithead. Talk about a total lack of awareness. We rented a huge Suburban. I pouted in the backseat, listening to Joe make fun of me, my mom smooth things out, and my dad get pissed. I pissed him off so much that when we pulled over for food, he deliberately went to Taco Bell because I hated it. I deserved that.

He drove the whole way and we made it back safely.

Mickey Mouse and terrorist attacks present quite a juxtaposition. That day and the following ones were surreal.

But that’s my experience, and that’s what I reflect on each year around this time.

Jim Hill, the HuffPo author, also collected more stories from Disney World here, here, here, and here. Browse away for more stories similar to mine.

Dash and the two ton connected device [interview]

I sat down with Brian Langel recently. Brian’s worked for some diverse companies over his career, including HBO, McGraw-Hill, and Union Pacific Railroad. He has the distinction of being the only startup founder I know to work for a railroad.

Brian is the co-founder of Dash. Dash’s software turns your car into a connected device. Your jalopy won’t turn into a 2-ton iPhone, but it’s closer than you think. Read ahead to find out exactly how.

What is Dash?

Dash is a connected car platform. We build software to connect your phone to your car. You purchase an OBD dongle, plug it into your car, and it pairs via Bluetooth to your smart phone.

While you drive, it gathers statistics from car sensors and provides feedback about any car issues as well as your driving habits and behavior. This is all to improve fuel efficiency and safety.

What inspired you and your co-founder Jamyn Edis to start Dash in the first place?

A while back, we started working on a boxing project for HBO together. We taped a device under the boxer’s glove to measure punch speed and force.

One day, we drove to the Mohegan Sun for a boxing match to test it. During the drive, we kept talking about vehicles and vehicle safety. There are so many computers and sensors inside of a car that nobody was leveraging. All the data was ephemeral. No one was applying big data processes that could measure driving habits and behaviors. We asked “Is there any way for us to improve driving via data?”

We started looking, found out about the OBD port, and saw it was universal. That became our entry point into car sensors and allowed us to build Dash.

So there are a couple competitors in this space, i.e. Automatic. What differentiates Dash from your other competitors?

We’re a software company. There are already a bunch of OBD reader hardware manufacturers building high quality devices. We leverage existing hardware. We don’t mandate that you purchase an OBD dongle that we created.

Automatic is a hardware company. Their software is only compatible to their hardware. We think we can expose Dash and the sensors of your vehicle to more people by leveraging existing off-the-shelf hardware.

Can you talk a little bit about the OBD port? 

Dash/iOS compliant OBD dongle

The OBD port was mandated by the US government for emissions testing. Through it, the government verifies in an over-the-top way that car manufacturers are meeting the standards Congress sets. It’s also a way for mechanics to identify issues and repair vehicles.

OBD has a long history with many phases. It was really solidified in the early 90’s. OBD-II is in all cars manufactured from 1996 and on. It standardizes how you get data from your car and how to connect a physical device. That’s how Dash is compatible with any car in the US from 1996 and after.

What are the most popular use cases for Dash? I’ve heard you talk about parents using it to monitor their child’s driving. I love that. What else besides?

People use it for fuel efficiency. Since Dash gives you real time information via auditory alert on your driving, you can tweak your driving and save money every day.

And you’re right, parents may be wary of giving keys to their 16 year old. But many of them feel better if those keys come with Dash. They can be alerted if their child is speeding or driving recklessly. That sparks a conversation which makes the road safer for everyone.

Then often times, something goes wrong with your vehicle. A lot of people have no idea about what happens under the hood of their vehicle. The check engine light normally only has an on or off switch. So, do you as a driver need to pull over right away? Is the car going to break down? Dash will give you that information in real time without going to a mechanic immediately. We can tell you if your current issue impacts gas mileage or actually, it’s critical. Get it fixed right away.

Then there are a lot of users that really like seeing information from their vehicle. We can give you information to say your battery is draining. Perhaps we’ve plotted over time that your voltage is decreasing. Check it out, it can be indicative of another problem. Or your coolant is low. It lets you be proactive. Instead of you pulling oil levels, engine temperature, or battery levels, we can push it to you.

People are busy and they don’t have time to always check up on their car. So having Dash helps them identify and solve problems before they become real issues.

How different is the data analysis between electric cars versus traditional gasoline powered vehicles?

The OBD-II reader is only mandated for vehicles that produce emissions. Fully electric vehicles like the Tesla aren’t required to have it. But besides Tesla, all other vehicles, like the Nissan Leaf, do have the OBD-II port. They’re made by companies who have existing architecture.

We still haven’t figured out fully electrical vehicles. The energy consumption, it’s not just fuel, comes from a number of different factors. That’s something we still have to focus on, but it’s an engaging and interesting conversation we have internally.

Right now, we give the state of their battery level, but we still have to dive deeper for electric vehicles.

Can you relay the story about how you collected the car code meanings and then relevant repair costs? It’s a great hack.

When we set out for Dash, we knew that there were engine light issues. When a mechanic reads it, they see an esoteric code, something like P0100. The mechanic knows what that means, how to fix the issue, and what rates to charge.

We wanted to go a step further. We didn’t want to just say, “Hey, here’s P0100, and it means X” because X is often mechanic-speak. We wanted to translate it to something meaningful for users.

We know one mechanic who teaches at the Henry Ford Institute in Detroit. He teaches what these codes means to future mechanics. He agreed to use a website we built as a teaching tool. For homework, these future mechanics would log into the website and fill out what each code means and costs. We basically crowdsourced the whole thing.

I read the dongle can allow you to remotely control some aspects of your car. How far can you take the car as a connected device?

Depending upon your vehicle and the dongle that you purchased, you can control many aspects of your car. For instance, all Dash users can clear their check engine light so long as it’s not for a severe issue. Through the dongle, we physically control the car and turn off the light. That’s all we currently allow for all vehicles.

In the future, we want to expand that. Some of that will require purchasing proprietary information from the car manufacturers. For instance, the ability to turn off the headlights of your vehicle can be accessed through this OBD-II port. So with your phone, you can say “Hey, make sure my headlights are off” or “Make sure my car is locked.” We’re working on some of these advanced features now and you’ll see them more frequently in the next 5-10 years.

So you were part of 2013 Techstars class, can you tell me about that experience?

It gave us exposure to tons of mentors, investors, and journalists that we wouldn’t have otherwise had access to. They really helped hone our pitch and our business strategy. They also gave us some resources to develop the product further.

Being a Techstars alum continues to be valuable today, especially in networking. We still meet with other CEO’s and CTO’s of Techstars companies and bounce ideas off them. When we’re looking to move into another country or hire for a certain role, we draw on their experience.

I saw on Github that you built a command line interface tool for Trello. Can you talk to me about it?

Though Dash has a hardware component and I’ve done other hardware things in my career, I’m really a software guy. Trello is a great tool, but as a developer I’m often in the command line. I’m always building and compiling code. I don’t like to interrupt my flow by switching to the browser and getting out the mouse. Developers are most productive in the command line.

There was no command line interface for Trello so I went out and wrote it. It was a great project and it was fun to do. I hope others can benefit from it.

Let’s talk jobs! What positions are you hiring for at Dash right now?

We’re looking for senior level Android and iOS developers, a junior level data scientist, and a backend engineer. We hired after a seed round of funding and built out the team. But now we’re looking to expand. I think within the next couple of months, we’ll really push and hire those roles.

Last question. What’s your favorite connected device besides your car?

A little while back, it was my Nest. I really enjoyed that. I have the Nest and their smoke detector. Those gave me piece of mind. We see Dash in a similar light. We bring new technology and analytics to something old that may have been a black box before.

Now I have this wearable watch and I’m really enjoying it. This is the LG. I got it at Google IO. I’m getting the Moto soon. I can get my emails and reply to them. It has voice recognition and lets me text away. I find it very useful.

How MakeSimply makes hardware doable [interview]

Alan Hyman is the co-founder of MakeSimply. In this interview, we cover how he started his company, why hardware’s time is now, his best advice, and yes, we talked body augmentation.

MakeSimply helps people bring their productions to reality. It’s idea to production simplified. They help with almost every phase of hardware: product development, outsourcing, manufacturing, and logistics. They’re a much-needed source of leadership and advisement for hardware startups.

How did MakeSimply come to be?

In 2009, a friend who wanted to create a tracking device approached me. The device was for small animals and used the iPhone. I used my connections at NYU to arrange some meetings. Everyone we talked to asked, “Where is your prototype? We want to see it working.” My friend wanted to approach a factory to ask them to build it.

I was simultaneously getting my master’s at NYU with my future co-founder to be Allen Shieh. One day, he gave a presentation on his family’s business. His family has been in manufacturing for over 30 year and has incredible relationships. They can’t do everything hardware companies need, but they could facilitate the relationships with partners who did. Those partners can do PCB, PCBA, metal machining, and injection plastic molding. They could do it at variable levels of scale and with inexpensive pricing.

I was floored. I needed this, so other people must need it too. I approached Allen about my friend’s product. He told me there was no chance a factory would build us a prototype. That’s okay. I decided to build it myself. I used a couple of Arduinos and a jailbroken iPhone and built it in two weeks.

Two people besides me were involved in the project. One person’s reaction was anger. I did something that she didn’t want me to do. But the other person was relieved. She was relieved because this could actually be built. She was secretly terrified it couldn’t be. That really drove the point home of how important prototypes were.

The project concluded. Allen and I connected again. We asked ourselves what’s going on in the community?

I was involved in hacker spaces. I was into the Open Hardware Summit, the Maker Faire had just begun. We looked around and the time seemed right. We came together, wrote a business plan, and decided to create MakeSimply to help hardware companies execute.

We both agree hardware is a really exciting place. But people have talked it up for years. Why do you think hardware’s time is now?

Moore’s Law. Moore’s Law is where processing power doubles every six months while prices drop. Realize this: the power in your iPhone would have taken up multiple large buildings in the 1960’s and 1970’s. Now it’s a small little chip. That’s incredible! That also has tons of ramifications.

The biggest is democratization. Now anyone can play with powerful chips. These chips don’t cost hundreds of dollars anymore. The chips from the Arduino and the Raspberry Pi are in the dollar figures. The cost of experimentation is significantly cheaper. I can get a lot of power at a cheap price and not be concerned about blowing the chip if I do something wrong.

These cheap components are what led to the Arduino in the first place. Arduino is an open source prototyping platform. It does complex things in simple ways. It’s electrical engineering with a community that builds libraries that in turn let resources spring up around the Arduino. If you want to see how you send a command in serial to the Arduino, Google it. Find the code, cut and paste, you’re done. It’s instant gratification. Or create your own code, post it online, get peer reviews, revise, and go forward. It lets you be creative. You need to know some basics, but it’s all well documented.

And think about this: the Arduino costs $29. In 2009, I was looking at other prototyping platforms that cost $10,000.

The cost for hobbyists and tinkerers to get started is now practically zero. Everyday people can get into hardware and play. Community gets built. There are places like SparkFun and Adafruit. LadyAda is amazing. Go to her website and get code to do anything with Raspberry Pi or Arduino. You can find out how a whole catalog of parts work and can be integrated into your product. What amazing resources people have created!

Hardware’s hard. You hear that phrase more than anything else. That said, where do people trip up most?

Mostly in manufacturing expectations. Manufacturing just is not that flexible. It has benefited from various technical advances, but as a startup you don’t have access to them. You can’t go to Foxconn and tap into their capabilities. You need a reality check on what resources are available to you.

Next, people don’t realize that when you’re prototyping you don’t have a manufacturable product. You need to have somebody to analyze the prototype to make sure it can be manufactured within your cost structure.

Besides cost, there are real world constraints. I’m working on an electric pen project right now. We have a sketch of it, but that’s not what the manufactured product will look like. The rendered piece is beautiful, but there are collaborations and trade offs that need to happen to bring it to reality.

It’s worth saying that while hardware includes software, hardware has a totally different knowledge base. People get software development. It’s well documented. Hardware? Not yet. Engineering is still an academic field. You learn it in college. It hasn’t been made less technical. I think that’s changing. The language will eventually become more mainstream.

From an investment standpoint, what do you think is the most interesting in Internet of Things?

I’m intrigued by fashion and technology. It’s all about the design, brands, and the marketing. Fashion can be designed to enable technology in very subtle ways. The user experience can be very well planned out.

We’re also coming towards the end of wearables. People have figured out what all these sensors do already. Are there any new sensors beyond heart rate and steps? If a startup tries to do steps, what differentiates them from every other tracker?

So the next logical step is body plus technology, like body augmentation.

Body augmentation is a loaded phrase. It can freak people out.

I wouldn’t label it augmentation. I’d call it body enhancements. But it’s much more than a wearable.

The medical applications are interesting. Companies are making attachments to the iPhone so you can detect various ailments by examining someone’s eyes. Google now has contact lens that measure glucose in your blood.

What’s your favorite connected device?

My phone. I carry it with me everywhere.

I don’t know if you noticed, but I’m wearing a very old style Casio watch. I collect digital watches. They’re geek sheek. I think they’re kind of fashionable again. Products like the Pebble are nice, but I think after a while they get annoying. I don’t need to be notified about everything that’s happening to my phone.

That’s a problem with wearables: there’s too much information. They release too many notifications. We need another level of computing power evolution, where we have things like Siri, Cortana, and Google Now to be that in between layer.

That’s my favorite connected device of the future. An assistant that can skim through anything I could be interested in reading and surface an article written by someone who I may not even know but it’s still relevant for me.

Contextual assistants that can surface long tail information for you.

Exactly.

What other advice do you have for potential hardware investors?

Make sure the company has a working prototype. It doesn’t need to be beautiful but it needs to work. Especially if you’re not an engineer, you can be sold on something that’s not physically possible.

I go to a lot of startup presentation events. I remember, at one of these events, an angel investor who judged a business plan competition. A company presented a product and portrayed it as simple solution that can change your life by accomplishing X, Y, Z. The angel, tells them flat out, “This sounds like an infomercial. Why don’t you tell me how you’re really going to do this? Your team has no one on it who can execute.” My advice to hardware startups is to make sure you have a balanced team, technical and business. The team is everything.

What advice do you have for would-be hardware founders?

If you want to do hardware, do it as a fulltime job. Don’t do it part time. You need to dive in and build your prototype. You’re going to have bumps. It’ll take you seven months, maybe even two years, to reach a manufacturing stage.

Know that beforehand, realize it takes that kind of dedication, and do it.

Lassy Project Investment

My partner Steve recently made an investment into a company called Lassy Project which will be bridged into Pilot Mountain Ventures. Here’s the what and why of it.

Lassy Project helps find lost children. Faster.

It has three types of users. First, the village, comprised of friends, family, and trusted neighbors who volunteer to be alerted when a nearby child is reported missing. Next up, the parents. If your child goes missing, you can notify an entire local community with the push of a button. Lastly, children. Using location monitors like a phone or GPS device, Lassy Project alerts parents when your child isn’t where they’re supposed to be. It’s worth noting Lassy Project doesn’t require your children to have their own phone.

Here’s how it works in practice. Your child walks to soccer, school, or a friend’s house on a daily basis. You, as a parent, set up safe paths for them. If your child wanders off, you receive an alert. Most times, it’s because they detoured to McDonalds or something similarly harmless. You confirm they’re safe and go on with your life.

But what if that’s not the case? You can’t confirm where your child is or what’s happening. You then escalate to your village. Village members receive an alert with a picture of the child, description, and the last active GPS information available. If needed, Lassy Project will alert surrounding villages for additional coverage to create an instant search and rescue party who work together to find your child.

Why sign up? 

Parents sign up to get access to the most effective tool to find a missing child…people. For those of us who aren’t parents, join the village knowing you can safeguard your community’s children, and maybe even save a life.

Sign up here! Download the iOS or Android app or sign up directly on their website.

Why we made the investment?

This is a good example of how PMV expects to do business in the near future.

First, we believe in Lassy Project’s team. I roomed with CEO John Guydon in Downtown Las Vegas during the June Catalyst Week. We got along on a personal level and I knew I’d love to work with him some day. He’s a D-1 collegiate champion and excellent sales person. His co-founder and CTO Temitope Sonuyi holds multiple degrees from MIT. Plus, these two have worked together since 7th grade. This fits our team-first focus.

Also, Lassy Project replaces a government program that isn’t effective enough: Amber Alerts. It takes Amber Alert hours before information gets sent out. That information is bare bones and quickly out of date. By comparison, Lassy Project sends rich details to people within seconds, including up to date tracking information. Every second, let alone hour, counts. This is easily 10x’s better than the current solution.

In addition, from a hardware perspective, we like their location tracker solution. Instead of a phone+tracking app or building something in-house, Lassy Project is hardware agnostic. Any device with GPS capabilities can be plugged into their system via API. That means the would-be abductor doesn’t know if something in the child’s shoe laces, backpack, or phone could track him. This is a big preventative measure. You, as a parent, also don’t have to buck up for a new iPhone.

We don’t think lost children is a frivolous issue. According to the DOJ, nearly 800,000 children were reported missing in a one-year period. This problem deserves to be solved.

John and Temitope also have incredible business development partners signed and in the works that really excite us. We can’t talk about most of them, but here’s an endorsement from the Colorado Fraternal Order of Police. These partners are really exciting distribution channels.

Things have sped up lately

For starters, Lassy Project announced they were accepted into the most recent Techstars Boulder class. They’re a few weeks in and loving it. And on last Tuesday, they launched a new version of their site. It’s a massive improvement.

It’s worth noting that both John and Temitope are the first all-minority team that we’re aware of to be admitted to a major accelerator program. Congratulations to them, that’s no small deal.

We love the team, we love the business, and we’re excited to work with Lassy Project over the coming years.

Public Service Announcement: More Interviews

Under the advice of Chris Yeh, I started blogging in early 2012. It’s some of the best advice I’ve received. Everyone should write.

I used the blog as an entree to people that were previously unavailable. I got great interviews and made some good relationships. Sometime in 2013 I stopped interviewing people. Over a year later, I’m going back to my roots. I’ve already started again.

Specifically, I’m talking to hardware makers. Hardware and connected devices are still nascent but growing wildly. With hacker spaces, maker spaces, and tons of nightly events, accomplished makers are already accessible. But I don’t think the word is spreading far beyond those confines.

When I speak about Arduinos, drones, 3D printing, I get blank stares in response from friends (whether they’re involved in startups or not). The interviews will answer some basic questions but they’ll also dig deeper. Let’s fix that knowledge gap.

If you’ve got any suggestions for who to speak with, drop me a line or drop ’em in the comments.

Interviews: allow me to re-introduce myself.

The only two ways to make money.

Gentlemen, there’s only two ways I know of to make money: bundling and unbundling.

– Jim Barksdale, CEO of Netscape

This quote has been bandied around a ton lately. Marc Andreessen discussed it with Fortune’s editor and even Harvard Business Review got in on it with an interview between HBR, Marc, and Jim.

Whether it’s higher education, Craigslist, music, or social media, this principle is everywhere. Right now, people clamor for an unbundled television subscription. Companies vacillate between consolidation and dis-intermediation in ebbs and flows.

By the by, bundling is kissing cousins to the commoditization/de-commoditization cycle I wrote about previously.

I’m super-nerd excited just thinking about it.

Free internet feels like it should be a basic human right

Except the Fairmont hotels disagree with me.

Why is it in my entire trip from New York to Boston the only place that wasn’t public transit not to offer free Wifi is the place I paid the most to be? My office space, the coffee shops I’ve been in, the diner I went to for breakfast, my dinner spot last night, and even the much maligned Amtrak gave it up for free.

But the Fairmont Battery Wharf, which I booked through Hotel Tonight at a steep discount from their normal $450+ rates, offered 24 hour access for $10. When New York City’s public parks offer free wifi and a super lux hotel only offers it to their President’s Clubs members (and even then often at a tiered rate), you know you have a problem. $10 isn’t breaking the bank. But I refused to purchase it on principle and had to put off some work until this morning.

It’s cheap bullshit and I won’t be staying in Fairmonts anymore.

My co-op’s luddite response to Airbnb and my solution

Technology revolt in action

Airbnb is on my mind (and not because of their new unintentionally graphic logo).  My co-op slipped a two-page letter under the door forbidding its tenants and shareholders from becoming Airbnb hosts. They refer to the company as “Airbnd.” I wouldn’t make fun of a typo. They actually have no idea what it’s called. I think that’s illustrative of the problem.

Language like “this building is our home and not meant to be treated as a hotel, B&B or weekend getaway for others” and “illegal subletting to strangers not only compromises the safety and environment of our building, it is unfair to fellow shareholders who follow the rules. Utilizing your apartment as a B&B cheats the corporation out of sublet fees that go toward building operating costs” and the resulting penalties make it clear: the board intends to govern with an iron fist. They are actively monitoring Airbnd to identify rule breakers.

Consequences

Get caught violating these rules and face serious consequences.

• $1,000 fine by the corporation
• $1,600-5,000 fine by the city, which they’ll contact directly to issue the violation
• For repeat offenders
  • Injunction by the board
  • Additional fines
  • Jail time for contempt of court (woof)
  • Eviction (double woof)
• If you’re a tenant and not an owner, immediate termination of lease and forfeiture of security deposit

I’m a tenant. I will not be put out on my ass. Therefore, I won’t ever be a host for Airbnb or a similar service.

The building’s response feels a bit draconian and reactionary. Maybe it’s time to think different. Look around. Airbnb has been illegal in New York since it began but that hasn’t stopped growth. It’s a wave you can either ride or be swept away by.

So what does it look like to ride the wave? How can any building take advantage of Airbnb from a cash flow, marketing, and safety perspective? Let us examine.

What is a guest

This building is our home and not meant to be treated as a hotel, B&B or weekend getaway for others.

This is partially legitimate. If the building constantly turns over it fundamentally alters its culture. Constant turnover is one reason many buildings maintain a maximum-rental-units policy, i.e. only a certain number of apartments can be occupied by renters and not owners. Ownership occupancy implies a minimum level of care. But that doesn’t mean our building isn’t infiltrated by guests daily.

If I’m in town, I can have multiple friends stay over for a night, week, or month and it’s acceptable. But if I’m out-of-town overnight, guests are no longer permissible and I don’t understand why. My presence won’t physically restrain them from making noise after hours. It also doesn’t change my responsibility and liability. If they make noise, I’m stuck with the consequences. Rightly so.

Must I know this guest personally? Our friend’s brother stayed overnight a few weeks ago. I don’t know him, but I trust him because I trust my friend. And must trust be earned through personal relationships? Or can it be earned and recorded on a public ledger instead? You know, like reviews from hosts garnered after multiple stays in their homes. Isn’t that prior behavior reassuring to the building?

Buildings allow these weekend-getaways when they allow guests of any kind to stay over. I don’t abdicate responsibility for my guests’ actions and should be held accountable. Is the smart thing to ban Airbnb guests altogether? Or is it smarter to reward tenants and shareholders who bring in good tenants to the building? And likewise, penalize those who behave badly. AKA, my guests are assholes and I can’t have guests stay over anymore.

Unfairness to the building OR we need to get paid

C.R.E.A.M. get the money, dolla dolla bills ya’ll

Illegal subletting to strangers not only compromises the safety and environment of our building, it is unfair to fellow shareholders who follow the rules. Utilizing your apartment as a B&B cheats the corporation out of sublet fees that go toward building operating costs.

Safety is convenient cover for wanting to get paid. We have doormen for a reason and we already hold responsibility for our guests.

Let’s get to money. I’m not sure if leasing your apartment results in additional fees to the co-op but sub-letting does. So let’s allow that the building misses out on revenue unfairly. That can be remedied.

If you want to become a host, apply to the building’s board.

As we discussed with maximum-rental-unit policies, for many buildings only a certain percentage of apartments can be rented out. Perhaps only a certain percentage of the building should be host-eligible. Once you determine that number, let eligibility be determined by lottery, rotation, or just let people apply for it. Charge them a fee anytime someone stays in their apartment at a level commensurate with fees charged for subletting. Charge them a fee just for applying. Why not?

Look, it’s good for you ya big dummy

Many of your shareholders, owners, tenants are going to use Airbnb or similar services. Does it really make sense to fight it?

If you’re concerned about who gets in, set guidelines and regulate it. Maybe only people who have successfully stayed X-number of times with a minimum review score of Y are allowed in. Maybe people can only do it for a maximum time period of Z.

If you’re concerned about money, and you are, why don’t you monetize it? Take this black market activity and bring it to the light. As a tenant, I’d be happy to rent my place for $200/night and fork over $50/night to the corporation. It gives me additional revenue to make rent, maintenance, or mortgage payments easier. It gives the corporation more money for improvements.

And lastly, think about the marketing potential. You have a new apartment for sale. The building has an elevator, part-time doormen, located in a beautiful neighborhood, and, oh, you’re allowed to put it up on Airbnb to supplement your income. Suddenly the line between investment and primary property becomes blurred and that property becomes even more popular. I can see that positively impacting prices in the whole building.

My message to my building and others like it is this: take advantage of the situation or don’t, it’s gonna happen anyways.

Africa & the Best Mobile Payments Platform I’ve Seen to Date

No fancy app here, nope. Not at all.

It’s been too long. The last two months of my life have been very hectic. We’ve planned a wedding, got married, had a parade down 6th Avenue to our reception (and made Instagram’s discover tab in the process), went to Africa for 3 weeks, and I just got back from Vegas after 1 week hanging with the Downtown Las Vegas Project people. Where to begin?

Meg and I are now married. The wedding was incredible. We were surrounded by friends and family. We’ve never had so much fun in our lives and wish we could relive it everyday. Thanks to everyone who supported us. We felt loved indeed.

We went on our honeymoon. Tanzania was otherworldly. I kept a written journal while we traveled (which.. I admit I must still finish). I’m no Hemingway, but it’s still my Green Hills of Africa. Moishe, Arusha, Karatu, Stone Town, Zanzibar Town, the national parks and conservatories, tribes, and wildlife are permanently seared in my memory. Pleasant weather and friendly Tanzanians greeted us wherever we traveled. That and poverty. Tanzania is poor. Dirt poor. Poorer than any community I’ve seen before. So imagine my surprise when I came across the best mobile payments system implementation I’ve seen so far.

I learned about M-Pesa before we traveled but that still didn’t prepare me. Born in Kenya, it’s spread across Africa. It’s numbers are impressive (19,671 active Kenyan users in 2007, to over 18mm in 10 countries and counting . M-Pesa has rolled out with telecom providers, like Safaricom and Vodacom, and works within the area’s technological constraints. Smartphones haven’t proliferated and I can’t imagine there’s LTE readily available. So they built the system on SMS.

The phone has a very simple menu (pictured up top), inviting you to do things like check your M-Pesa deposit balance. It acts as your mobile bank. You can send money to family or friends or pay bills. M-pesa just checks your account to ensure you have a balance and generates a unique code for your counterpart to deposit and immediately access the funds. I didn’t see the merchant on-boarding process, but it’s got to be a breeze. Tribal regions far removed from cities and towns had small pharmacies and bars with big signs stating “M-Pesa accepted here!” Funny enough, the signage typically covered by Coke advertisemnets. Tanzania has more Coke advertisements than gazelle. 

Competition is minimal. Zanzibar had an alternate version that looked to be a carbon copy of it, regrettably I can’t find its name. Fraud must exist, especially since merchant “banking” seems so easy to sign up for. The only requirements are a national ID card or passport. But these frauds haven’t been big enough to take down the system evidently. Mostly it’s phishing, but there must be criminal implications too. Here’s a Quartz article about exactly that. Incredibly, the unbanked are being banked.

This solution doesn’t work in the US. There are too many entrenched interests trying to come up with too many competing solutions. You’ve got your startups like Dwolla, banks and their proprietary/closed off systems like Chase and their lovely QuickPay, eBay’s PayPal, the telecom’s and their failed attempt with Isis (conveniently rebranded due to another more infamous ISIS). Yet somehow, these guys pulled it off with phones that are years behind ours in capability and people who wouldn’t have ever been eligible for banks before. It’s quite amazing.

And now, I’m home and back to work. it’s good to be back in the New York Groove.

Take ’em away Ace!