Edge Computing: Chick-fil-A Style

Chick-fil-A’s tech team recently put out a detailed post on their extensive edge computing deployments across their stores. Their overarching thesis is that more data at the restaurant level will help them scale better. In their own words:

Our hypothesis: By making smarter kitchen equipment we can collect more data. By applying data to our restaurant, we can build more intelligent systems. By building more intelligent systems, we can better scale our business.

One example they reference is building a more accurate forecasting model for the number of fries that should be cooked over every minute of the day. The status quo is a forecasting model running in the cloud  that uses transaction level sales data from many restaurants. The issue is that it is not reliable enough to drive food production due to the local factors that influence a certain restaurant (weather, sports, traffic). Instead, an edge deployment coupled with IoT-enabled devices in the store could POS system keystrokes and data from fryers about the status of what’s cooking to make actionable predictions.

Their early bet on data and investment in infrastructure is prescient as new startups enter the food space with high hopes. Robotic restaurants such as Spyce, Creator, and Zume Pizza are hoping that automation will enable them to scale quickly and profitably. One of the few advantages that incumbents have on these new startups is the sheer number of stores and customer interactions. Chick-fil-A understands that value and importance of investing to capture and use that data in a meaningful way.

In terms of the infrastructure itself, they’re running 2,000 small clusters with tens of containers per cluster compared to the well-known players like AWS, Google Cloud and Azure who run 100x-1,000x more containers in a few large containers. Unsurprisingly, they’re using Kurbenetes for orchestration. They’re using commodity hardware for $1k/restaurant. They’re cloud-first when possible with fallback onto edge.

And at the end of the day, all this infrastructure is in service of a single goal: more customers “Eating More Chicken.”

What Were Tech Founders Like In College?

The founders of technology companies such as Microsoft, Apple, Airbnb, and Netflix have succeeded in reshaping entire industries and changing the lives of billions of people around the world. I was curious to understand what tech founders were like during an experience that significantly shapes many people: college. 

Below, I have compiled excerpts that describe how 10 founders of major tech companies experienced college. They come from the founders’ themselves, classmates, or faculty members. They describe how the founders spent their time in college  to how college influenced what they would do after, and how college shaped their view of the world. The schools represented are all over the higher educational spectrum: liberal arts, research university, public, private, and so on.  

Some highlights: 

  • Bill Gates’ freshman year roommate describes Gates as working for 48 hours straight and then crashing for 18 hours until restarting the cycle
  • Steve Jobs thought his college humanities lectures were meaningless at the time but with time has realized that they have helped him in “everything” he’s done
  • Elon Musk ran a nightclub in a ten-bedroom house on the weekend while at the University of Pennsylvania – he and his friend charged $5 for unlimited drinks (including Jello-O shots)
  • Brian Chesky of Airbnb eased the anxiety of giving his class’s commencement speech by watching the staff set up 6,000 chairs in the auditorium the night before
  • Reed Hastings of Netflix was a dedicated peer tutor who offered a detailed plan to revamp Bowdoin’s self-paced calculus course

While some of the above may have been exaggerated through the passing of time, they offer a fascinating look into how the founders of enormous companies went through college. Take a look at the excerpts below to learn about other founders experienced college including Jeff Bezos (Amazon), Marc Benioff (Salesforce), and others.

Many of the recollections show that these founders felt many of the same feelings in college that college students everywhere have likely felt at one point or another. Some founders recount their stories of anxiety, confusion, or even inadequacy. Others describe the gratitude that college enabled them to try new things, positively shaped their worldview, and inspired them to more clearly see their future profession. It seems that college is the same whether or not you go on to start a billion dollar technology business: a time of self-discovery with plenty of ups and downs.

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What I’ve Been Reading

  1. Brad Stone, The Upstarts. Comprehensive, well-researched look into the rise of Uber and Airbnb. The founders’ sheer force of will while building their businesses is impressive.
  2. Tom Wainwright, Narconomics. Fascinating exploration that uses economics to examine drug cartels as firms. Makes a compelling case for why the “War on Drugs” has not succeeded and advocates for rethinking policy interventions.
  3. Simon Blackburn, Think. A refreshingly accessible primer on philosophy that explores eight topics (e.g. knowledge, free will, reasoning) through the viewpoints of the who’s who of the western tradition. 

P.S. The format of this post is inspired by Tyler Cowen who shares his voracious reading habits on his excellent blog Marginal Revolution.

The Direct-to-Consumer Revolution: Six Laws for Founders and Investors

This post was co-authored with Vinay Iyengar.

From startups like Allbirds and Harry’s to larger companies like Tesla, the Direct-to-Consumer (D2C) business model is becoming increasingly popular.

Today, the supply of consumer products greatly outstrips the demand that exists in the market. As a result, consumers are demanding a new experience that big box retailers and other “middlemen” simply can’t provide. Companies want a way to reach consumers directly and control every aspect of that experience.

The rise of D2C companies follows off the back of what General Catalyst’s Hemant Taneja refers to as “economies of unscale.” Modular services have greatly reduced the barriers to launching a D2C strategy. Back in the early 2000s, it was difficult for an e-commerce startup to build and manage aspects of their business. Now, a startup can build an e-commerce website with Shopify, manage payments processing with Stripe, talk to customers with Intercom, and manage logistics and customer service through Fulfillment by Amazon.

Finally, the removal of the middleman and the associated 2x to 4x markup translates into higher margins for the producer and a lower cost for the consumer.

The D2C business model has proliferated throughout the startup world. Below, we have compiled the six laws for those interested in D2C startups, whether from the perspective of a founder, investor, or advisor.

             The six laws that define a great direct-to-consumer company
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