TransferWise is one of those companies where you can just sniff groundbreaking success. TransferWise is a London-based peer-to-peer money transfer service which was started in January 2011. Earlier this week, the company was in the news because of rumoured discussions with well known Silicon Valley venture capital firm Sequoia Capital, which could result in a valuation of nearly $1bn.
Transferwise is looking to disrupt the current status quo in banking land whereby premium (hidden) fees are charged when transferring money abroad. TransferWise was created to solve a problem that its Estonian co-founders Taavet Hinrikus and Kristo Käärmann had experienced personally.
As Estonians working between their native country and the UK, they felt the “pain of international money transfer” due to bank charges on the amounts they needed to convert from euros to pounds and vice versa. With TransferWise, Taavet and Kristo are looking to remove the often felt frustration around transferring money abroad by significantly reducing the fees that one has to pay when transferring money. Banks charge up to 5% in (hidden) fees whereas TransferWise users pay 0.5%.
I’ve only just started using TransferWise myself, so I’ve start to look into how TransferWise works more closely:
- Peer-to-peer – When looking at the steps involved in transferring money through TransferWise (see Fig. 1 below), the component that helps in keeping Transferwise’s rates low is the fact that one’s outgoing money transfer is matched with people sending money in the opposite direction. This is different to how traditional banks tend to route payments abroad. Instead of transferring the sender’s money directly to the recipient, it is redirected to the recipient of an equivalent transfer going in the opposite direction. Likewise, the recipient of the transfer receives a payment not from the sender initiating the transfer, but from the sender of the equivalent transfer. This process avoids costly currency conversion and transfers crossing borders (see Fig. 2 below).
- Word of mouth – Given that Transferwise is peer-to-peer, growing its user base is critical to its success. TransferWise has a friend referral programme which incentivises users to invite their friends to TransferWise (see Fig. 3 below). I’m curious to find out more about how effective this programme has been in spreading the word and growing TransferWise’s user community. Currently, referrers are rewarded with cash incentives; it will be interesting to see whether TransferWise will – in the true spirit of gamification – motivate with the use of data instead of or as well as money. Businesses like Dropbox, Fab and Evernote have all created very successful referral programmes, using a number of gamification mechanics. I can imagine TransferWise have a solid group of customer advocates, who’ve derived tangible value from using its services. I wonder if these user champions are utilized by TransferWise in some sort of capacity, whether they have a formal customer advocate programme, engaging these users into campaigns or product improvements.
- What do users say? – Just to get a sense of how successful TransferWise is in delivering on its mission and its differentiators, I had a quick look at some of the user reviews on TransferWise’s page on Trustpilot. A quick scan of some of the comments on there shows a lot of happy customers. If there is a negative point, it’s the lack of speed with which the money transfers are completed. Some users feel that TransferWise is slower at transferring money than some of the other money transfer services but they seem to offset this against the money they save in transfer fees.
Main learning point: TransferWise is one of those businesses that is truly exciting. Firstly, their whole mission is about shaking up an industry by introducing a new way of doing things. Secondly, they are delivering tangible value (i.e. less money spent on money transfer fees) to their customers. I’ll definitely continue to use their services and I’ll keep a close eye on how they grow their user base over the coming years.
Fig. 1 – How does TransferWise work? Explained in 4 key steps – Taken from: https://transferwise.com/en
- Get started – Enter how much you’re transferring and where to. You can send to your own account abroad or another person or business.
- Upload money – Pay TransferWise in your local currency. Use your debit card, just like shopping online, or make a normal bank transfer.
- Conversion – TransferWise converts your money at the mid-market rate and matches you with people sending in the other direction.
- Money sent – The converted money is sent to the target bank account. Everyone gets notified by email, so you always know where the money is.
Fig. 2 – Comparing the usual concept of money transfer vs the peer-to-peer concept of money transfer – Taken from: http://commons.wikimedia.org/wiki/File:Transferwise.jpg and created by Shaviraghu – Own work. Licensed under Creative Commons Attribution-Share Alike 4.0 via Wikimedia Commons
Fig. 3 – Screenshots of Transferwise’s online referral functionality
Fig. 4 – Some excerpts from user reviews on TransferWise’s TrustPilot page – Taken from: https://www.trustpilot.co.uk/review/transferwise.com
- “Transferwise was very easy and emailed me every step of the way to tell me where my money was. As I’d never used a service like this, I called customer service several times and they were very helpful and assuring. It’s not as fast as a wire transfer between banks, but if you don’t need the money straight away, it’s worth it. The conversion rates are way better than what your bank will offer you, and you can avoid any international currency fees banks add on top of that. Would recommend to friends in the future.” “Kelly” on 13 November ’14
- “If you used a main UK bank the minimum charge is around £25 and can take a while to complete, the exchange rate is usually fairly poor too. No such problems with Transferwise, small charge of £4.98 to send £1,000 and got €1,270.92 (1,277.3 less fee). We should all be using TransferWise.” “John Clive Williams” on 13 November ’14
- “I hate hidden fees. Transferwise is even faster than they claim. And they did everything they promised. Perfect.” “Mark” on 13 November ’14
- “I was trying to send money using my debit card and I received a misleading e-mail stating that I should contact my bank and transfer the money to Transferwise’s bank account. I didn’t want to do that so I tried again with my debit card and it worked. But the transfer was made twice… Lucky it was a small amount.” “Catherine” on 12 November ’14
- “over the moon with TransferWise, the ease of transferring my money, the rates offered and the fantastic minimum charge is the best around. Saved a lot of money with this service. Thank you” “Gerard” on 12 November ’14
- “Not quite as fast as the competing “more commercial” services, but the best rates we have ever achieved by some way.” “Simon” on 13 November ’14
I really like the concept of a “Playable City”. At a recent conference, Clare Reddington, Creative Director at Watershed, spoke about the concept of a Playable City. A Playable City is a city where people, hospitality and openness are key, enabling its residents and visitors to reconfigure and rewrite its services, places and stories. In other words, the concept of Playable Cities enable inhabitants to interact with their cities in a way which is very different to their everyday interactions. I guess the concept can be best explained through some great examples:
Luke Jerram – “Park and Slide”
“Park and Slide”, a one-off interactive art installation by Luke Jerram which took over a Bristol high street last year, with people taking turns on Jerram’s giant water slide.
Jonathan Chomko and Matthew Rosier – “Shadowing”
With this project by Jonathan Chomko and Matthew Rosier, Bristol’s city lights have been given memory, enabling them to record and play back the shadows of those who pass underneath.
Design I/O – “Faces”
“Faces” is an interactive installation that captures your portrait and sketches it at large scale, projected onto a building across the street. It was installed for six months as part of San Francisco Art Commission’s “Lights on Market St” Project. During that time, Faces captured and displayed 30,000 portraits, with an average of 160 portraits a day. Pan Studio – “Hello Lampost” “Hello Lamp Post” was a playful SMS platform project that ran in Bristol and which enabled people to strike up conversations with familiar street furniture using the text message function of their mobile phones. As a result, people shared their thoughts and stories with streetlights, parking meters, letter boxes, bridges and boats in Bristol, with over 25,000 text messages sent by players in just 8 weeks.
Main learning point: I love the concept of “Playable Cities”, enabling people to see their cities in a new light and to interact with their everyday environments in a completely different way. Apart from the playful element involved in some of the Playable City projects, I believe that we can also learn from the new ways in which people interact with everyday objects. We can apply these learnings to other product areas and interactions.
Related links for further learning:
The strap line of Product Hunt is “the best new products, everyday”. Product Hunt is a site dedicated to “sharing new, interesting products” and I found over the last few months that it does exactly what it says on the tin:
- A community around cool products – The main concept for the guys who started Product Hunt, Ryan Hoover and Nathan Bashaw, was to build a community for product people to share, discover, and discuss new products. Product Hunt is a crowdsourced site and is fully democratic in a sense that its members decide which products get featured and how they rank. For example, on 27 August, Monitorbook – which helps people to track things on the web – topped the list of products, with 466 votes (see Fig. 1 below).
- “Reddit for products” – On Product Hunt’s page on AngelList, it says “Reddit for products” which in my opinion is only a partially accurate representation of what Product Hunt is about. Yes, at the face of it, Product Hunt does have a lot in common with crowdsourced news site Reddit; people can submit links, upvote and comment. Even the list-type design of the site looks like Reddit’s. However, I find the design of the leaderboard type lists on Product Hunt much cleaner and easier to read than Reddit. I can see at glance which products got the most votes on any given day and I can delve into the related comments if I wish. It only takes a quick look at Reddit to establish that the design of their page feels a lot messier and crowded.
- Product discovery before everyone else does – One could easily argue that sites like TechCrunch already address the need for people to find out about new startups and new products. With Product Hunt, however, this process of product discovery is fully democratic and transparent. Anyone can submit a product to be featured on the site, which will then be curated by the Product Hunt community. I believe this process increases the chances of finding about cool new product ideas before ‘everyone else’ does (e.g. through TechCrunch or Engadget).
Main learning point: I’ve rapidly become a fan of Product Hunt, mainly because of two key reasons. Firstly, if you’re into finding about cool new products and startups, then Product Hunt should be an almost mandatory part of your day. Secondly, I really like how the content on Product Hunt is shaped democratically by a product-oriented community. If you haven’t done so already, please go and check out Product Hunt!
Fig. 1 – Screenshot of Product Hunt on 27 August 2014
Fig. 2 – Ryan Hoover explains about Product Hunt on This Week in Startups
Related links for further learning:
A few months ago I wrote about some of the principles that underpin game design and I now would like to have a closer look at the specific elements that help to form games and game mechanics. In his online lectures on gamification, Kevin Werbach – an Associate Professor of Legal Studies and Business Ethics at Wharton School – talked about the interplay between:
- Experiences – What the player feels.
- Games – A set of rules around which a game is played.
- Elements – The ‘bits and pieces’ that make up a game.
Kevin then went on to talk about the MDA framework as created by Robert Hunicke, Marc LeBlanc and Robert Zubek in 2001. The MDA framework formalises game consumption by breaking games into their distinct elements: rules, system and “fun”. These elements translate into the following design counterparts which comprise the MDA framework: Mechanics, Dynamics and Aesthetics (see Fig. 1 below). What do these different components of the MDA framework entail?
- Mechanics – In his lecture, Kevin Werbach described game mechanics as “the processes that drive actions forward”. He subsequently compared mechanics to “verbs” which help people to play games (see Fig. 2). In their academic article, Robert Hunicket et al. defined game mechanics as “the particular components of the game, at the level of data representation and algorithms”.
- Dynamics – After comparing game mechanics to “verbs”, Kevin likened game dynamics to “grammar”. These are “big picture aspects” which combine game mechanics (“verbs”) and game components (“nouns”). A game dynamic can be defined as a pattern of loops that turns them into a large sequence of play. Tadhg Kelly has written a great blog post where he delves deeper into game dynamics (see Fig. 3) and I also came across an interesting TED Talk by Seth Priebatsch (see Fig. 4) on the same subject. On the topic of “game components”, Kevin compared these to “nouns” which put together help to form the flow of a game. These are specific instantiations of game mechanics and dynamics (see Fig. 5).
- Aesthetics – In the MDA framework, the point about “game aesthetics” is all about making games ‘fun’. One of the guys behind the MDA framework, Marc LeBlanc, came up with 8 kinds of fun as a more specific vocabulary to describe game aesthetics (see Fig. 6). In the MDA framework, game aesthetics are described as “the desirable emotional responses evoked in the player, when she interacts with the game system”.
Main learning point: the MDA framework is great practical tool which helps to think about games and gamification in a more structured kind of way. We all know how easy it can be to slap a leader board or points system into a game or an application but the MDA framework really forces us to think about our rationale for considering some of these game elements.
Fig. 1 – The MDA framework by Robert Hunicke, Marc LeBlanc and Robert Zubek (2001) – Taken from: http://www.nolithius.com/game-design/the-mda-framework
Fig. 2 – Sample list of game mechanics as provided by Kevin Werbach as part of Coursera’s online Gamification course
- Resource acquisition
- Win states
Fig. 3 – “Game Dynamics and Loops” by Tadhg Kelly – Taken from: http://www.whatgamesare.com/2011/01/game-dynamics-and-loops-game-design.html
- Linear vs player driven dynamics – A good example of a linear game dynamic is Space Invaders where the game dynamic is the continuing increase of challenge as the enemies proceed down the screen and get faster. With player driven game dynamics like in Animal Crossing the loop is the receipt of a task and the actions to complete that task, but the dynamic is the further branching of more tasks across days or weeks.
- Primary vs secondary dynamics – There are plenty of games out there which are based upon a single, powerful game dynamic. A good example of a game with such a strong primary dynamic is World of Goo where the game is all about creating structures with balls of goo. In contrast, games such as Wii Sports contain lots of mini-games, each with their own dynamic.
Fig. 4 – Seth Priebatsch “Building the game layer on top of the world” – TED Talk on 20 August 2010
Fig. 5 – Sample list of game components as provided by Kevin Werbach as part of Coursera’s online Gamification course
- Boss fights
- Content unlocking
- Social graph
- Virtual goods
Fig. 6 – Sample game aesthetics by Robert Hunicke, Marc LeBlanc and Robert Zubek (2001) – Taken from: http://www.cs.northwestern.edu/~hunicke/MDA.pdf
- Sensation – Game as sense-pleasure
- Fantasy – Game as make-believe
- Narrative – Game as drama
- Challenge – Game as obstacle course
- Fellowship – Game as social framework
- Discovery – Game as uncharted territory
- Expression – Game as self-discovery
- Submission – Game as pastime
Related links for further learning:
The other day, I heard about the rumoured takeover of Twitch by Google for the handsome amount of $1 billion. I have to be honest; up until that point I had never heard about Twitch. Reason enough to look into Twitch and a possible ratio for Google willing to spend such a large amount of cash on this startup:
- What is Twitch? – Twitch is a video streaming platform and a community for gamers. Geekwire describes Twitch as “the ESPN of the video game industry” and says Twitch is a leader in that space. Twitch has over 45 million monthly users and about 1 million members who upload videos each month. In a relatively short space of time (Twitch was launched in June 2011), Twitch has successfully created an online streaming platform for video games.
- Who use Twitch? – I’m not an avid video gamer myself, but browsing the Twitch website tells me that are in effect two main user roles, which are closely intertwined: game players and broadcasters. Clearly, you can be both and I’m sure that a lot of Twitch members fulfil both roles. One can play games on Twitch channels like Counter-Strike: Global Offensive or World of Tanks or one can create their own pages from which you can broadcast games. A great example of Twitch’s success in engaging its community around a game is TwitchPlaysPokemon which has had over 78,000 people playing a game that turns chat comments into controller inputs, parsing hundreds of thousands of ups, downs, and starts and translating them into in-game movements.
- Why is Twitch such an interesting acquisition target? – Twitch is reported to have snubbed Microsoft’s takeover offer but is rumoured to have fallen for Google. This raises the question as to what makes Twitch such an interesting takeover target? I think that the answer can be split into two main factors. Firstly, scale. Twitch has a rapidly growing and very engaged user community who all share a passion for (video) gaming. Secondly, live broadcasting. Going back to the example of TwitchPlaysPokemon, Twitch streams games that get people excited and gets them participating in real-time. This simultaneous element is something that for instance YouTube is lacking. YouTube is great for on-demand video content, but (currently) less so for live event coverage or participation. The combination of both factors (as well as a very rich vein of user generated content and data) makes Twitch an extremely interesting target indeed.
Main learning point: Recently there have been some major takeover deals in the digital industry – think Instagram, WhatsApp and Beats – but the rumoured acquisition of Twitch by Google is interesting for a number of reasons. If I have to highlight one key reason, then synergy is the main aspect that makes this potential takeover sound like a very exciting one. How will Google potentially integrate YouTube and Twitch or at least find a way to combine both platforms? Will the acquisition of Twitch help YouTube in cracking the real-time broadcast element of its offering? Lets wait and see if the deal actually gets done in the first place, but if it does then I will definitely keep an eye out for any future developments involving Google, YouTube and Twitch.
Related links for further learning: