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September 6, 2000
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Celera-ing the Invisible
Celera-ing the Invisible: Some thoughts on what might happen next�
Well, the board has been smoking along at its usual clip. However, I sense a "post-party" malaise after the announcement of the completion of the Human Genome Sequencing. Even to the point of doubting whether sequencing is complete. When confronted with a stagnant present, I always tend to look to the future. This has prompted me to start thinking about what Celera's database might look like in the future and what Celera needs to do to become a dominant force in the Century of Genomics. If you would honor me with your effort, read on - if not, have a beer and watch the sunset. I'd offer to pay for the beer, but I've seen TMFers on drinking binges and it could get expensive. Just kidding Foolks, I know you only get loaded a few times a week. :o)
Just a note, I don't consider myself any type of authority on this stuff. I hope that this will throw the doors open to debate about the next step and a progressive, visionary discussion about who/what/where/when/why will result in the success of this company.
Selling the Invisible
DR. VENTER, PLEASE READ "SELLING THE INVISIBLE" BY HARRY BECKWITH. Well, now that the unpleasantness (me trying to give the company a boost and thereby increase my own net worth) is over with, we can talk about a wonderful book and how it plays into this scenario. Selling the Invisible is a fantastic book about the service industry and how to provide service that is truly compelling. I read it on a Foolish recommendation of the Soapbox clan (www.Soapbox.com) and am quite satisfied that it is worth the effort.
In a few words, Selling the Invisible explores service to the extent of identifying service industries, service quality and marketing's connection to good service. I believe that service is of paramount importance to the success of Celera Genomics. Why? Well, there are competitor's out there doing it a lot cheaper, i.e., the public Human Genome Project has their version of the genome for free. Also, DoubleTwist is selling computer time and computers for D-I-Y analysis of the public database. Further, Incyte is a formidable company with an extensive and proven database of EST's that includes a large majority of all known genes. There are others, but I am running out of segues.
How in the world can Celera beat these competitors? Well, there are two components that I see, 1) have more and better information than the others and 2) provide better service than the others. We already know that Celera is sequencing faster than all the rest and that having MORE information is almost inevitable (crossing fingers). However, I believe that this is not enough. Celera must also have excellent service.
Every business is a service.
One very significant point that Beckwith makes is that EVERY company is a service company. "[M]any of the manufacturers listed in the Fortune 500 are, on closer inspection, something different. Industrial giant General Electric actually derives 40% of its revenues from services, for example. Nike, presumably a running shoe manufacturer, does not make shoes. It merely designs, distributes and markets them. Nike is primarily a service company."
With this context, let us look at Celera Genomics. Well, one could easily say that they merely sell information and this would be true in one respect. However, if all they sold was information, the business would likely fail. I mean, look at a line of ATCG letters and you'll realize that it looks like a load of crap (sorry ladies, my fiance always said I put the "ass" in class). It is like trying to read computer code without a compiler. It is really not comprehensible in its raw form and requires some type of massaging. This massaging is in the form of annotation. Annotation accompanies certain key strings of the sequence and inform the user of the sequence about its significance. Think of it as Cliff's Notes for the sequence itself, giving context and meaning to that bit of sequence. Maybe the annotation contains a list of other genes that tend to act in concert with this particular gene sequence. Maybe a list of maladies associated with that sequence, or a certain trait or characteristic defined by that sequence (blue or brown eyes).
Annotation is everything for Celera Genomics. It is the dividing line between Celera and the other databases in that this is part of what the subscriber is buying. For Celera to be successful, it must add value to the raw sequence that gives its subscribers a competitive advantage. As I see it, good annotation is a function of 1) good science and 2) good computer programming.
Good science is the easy part for Celera Genomics. Read the list of scientists and you see Dr. Venter and a Nobel Prize winner at the top of the list. Add to this the Annotation Jamboree and you have the collaboration of several top minds in the business. If purchased individually, the cost of these consultations would be prohibitive for almost all subscribers. Okay, maybe Amgen could buy them all with their budget for office supplies, but most academic labs would find this stuff way out of reach. In sum, I trust Dr. Venter to bring us good science. He is the racehorse that has been on this track a dozen times before and has won every time.
Software is more than just code, it is ultimately a service. Beckwith slams this home in his book, "If you sell software, you know that your core product is software, but that the critical party of your product is all the augmentations: the documentation, toll-free services, publications, upgrades, support and other services. Your users are buying a service." For Celera, this kind of effort is the most difficult and is just beginning. Essentially, they will have to be Amazon, Apple and McDonald's all wrapped into one. The service component of the business will have to be clean, fast, intuitive and VIRAL. The users will have to find it easy to learn, easy to use, and HARD TO PUT DOWN. Being viral is the key to success for Celera. Don't you just love the irony?
Beckwith and How to be Viral
Viral? Sounds like a bad thing, nobody wants a virus. However, a Viral product is a boon and not a bane. Viral, in business terminology, is a GOOD thing. It refers to the stickiness that keeps a customer coming back for more, and the grassroots invasion of the consciousness and buying habits of your customer base. What kind of things do we know that are Viral? Well, cell phones for one. Do you know anyone who has owned a cell phone and then gave up that cell phone. If you do, let me know, because I don't think it happens often. That cell phone moves from a convenience to a necessity so quickly it is dazzling. The same thing goes for the Internet. Four years ago it was a novelty, now it is a mainstay. We pay our bills, trade stock (hopefully not day-trade!), email our relatives, update our itinerary, etc. Now we (I, maybe this is a bit presumptuous) can't live without the dang thing.
What are some companies that have achieved a viral status? Well, the connection to be made here is with those companies with strong brands. Oh a strong brand is groovy and powerful to the Nth degree. Notice how you order a Coke without thinking about it? Or, how you say "Let's go get Starbucks! instead of coffee. Or, "I need a Kleenex. For Celera to become Viral, it must be THEE business for bioninformatics. Celera can accomplish this by making itself indispensable with good service and characteristics that just can't be found elsewhere.
One method of making a good, viral, service, is noted by Beckwith in a section entitled Let Your Clients Set Your Standards. To demonstrate the difference between your standards and the client's standards, Beckwith cites the following example, "Lawyers think the same way. They'll say, 'That's a really good brief.' Never mind that the brief was equally effective for the client $5,000 earlier. And never mind that the brief covers an issue that might have been avoided entirely through good lawyering."
Hmmm, what in the world makes a database valuable to those who use it? Hell if I know! The only similar database that I use is Lexis-Westlaw for legal stuff, I am not a biologist. Probably the best way to know is to ask the biologists. This is another fairly easy task for Celera. I mean, the place is crawling with biologists, including the people making all the decisions. This shouldn't be hard to do, deciding the needs and wants of the biologists. I trust them to come up with something meaningful and necessary. However, I also doubt that this will exceed the service available at the government database. Nor would this come close to Incyte, which I am sure has much, much more.
Mind-bending Good stuff�
Hear that whining noise? That's the sound of the drill, we're drilling down - getting to the essence of what I think is most important to the success of Celera. It might also be the sound of a Dodge Viper in my driveway. Regardless of your badge of success, the most important passage in Beckwith's book (with respect to Celera) is buried amongst the others and not presented with much fanfare. However, for me, it encapsulates the essence of a successful technology company, and any other company for that matter. This section is entitled, "Getting Better vs. Getting Different."
Beckwith backs up his pithy saying with, "America's greatest services successes are not companies that did what others did, but a little better. They are companies that decided to do things a whole lot differently. . . Federal Express did more than refine mail delivery. It invented a thoroughly radical, logistically brilliant, and remarkably well-executed method for delivering packages over great distances at enormous speeds." I love the example of Federal Express, because it brought us something viral that we can't do without. It also brought us something that people didn't even know they needed.
Celera needs to bring people (biologist, physicians, et al.) things that they didn't know they needed.
What the biologists are probably doing is salivating over the idea of just having the information from the genome at all. What Celera has to do is to give it to them in a form that is so convenient and visionary that it becomes the new standard. I have pictured things like:
1. A three dimensional, color-coded rendition of the genomic information
2. An interactive version where some type of smart controller can be used to "cruise" through the database looking for SNP signposts
3. Modeling and projection of experimental results for different assays supported by other data on homologous genes
4. Dial-up consultation over the web with experts on various areas of the information where they will relate their experiences using certain sequences
5. Educational multimedia for physicians to correlate diagnoses with their genetic testing results for certain patients
6. Ordering of biochips for research customized to one's selections while on the database itself
Perhaps I am just doing pie-in-the-sky stuff, but I hope it is the sort of imaginative thinking that Celera bioinformaticists are pursuing. I don't see the government having the will or the funding for coming up with this type of stuff. If Celera can just find that viral app, then they will get loads of business.
Does anyone have any other ideas? I know it might be speculative, but it might also be fun and informative.
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