Tech Companies That Aren’t
Technology is everywhere and affects every interest and industry.
When we think of tech companies, we tend to think of those which offer some kind of software, hardware or technology-based service that we access via our phone or computer. It’s true that in the internet era, the number of technology companies offering unique services or access like this have expanded tremendously. Where once we simply had hardware or software based companies, we know have service-based apps and sharing economy platforms that produce little other than code—just think of Uber, Airbnb and Postmates.
The Tech Sector Expanded
However, when it comes to purchasing physical products, the line between conventional company and tech company seems to blur a bit. Even though it is now customary for nearly every business—brick and mortar or not—to have a website and sell its products online, that for a long time has not qualified them as a tech company. But recently, we have seen a slew of new companies selling products that are in no way novel or technologically-based—think mattresses, coffee or toothbrushes, underwear—that seem to be framing and positioning themselves as tech-based companies.
If you want proof of this, look at the language that these companies use. They don’t have customers, they have “users.” The seek “rounds of investment” just as any startup might. And they’re out to “disrupt” the way we’ve done banal things like brush our teeth or buy a mattress. With websites, apps and customer service that’s as slick as any major tech platform, these companies are upending traditional notions of retail and subscriptions and their using tactics that seem to be straight out of a Silicon Valley playbook.
In the Mainstream’s Eye
A perfect example is the mattress industry. As Alex Hern of The Guardian recently noted: “If you’ve glanced at the ads for Simba, Eve or Casper, you’d be forgiven for thinking they were flogging some kind of new gadget. They have the aesthetic of tech startups everywhere, tout the research and development that went into their sparkly new products, and offer eye-catching, venture capital-funded deals. If you look more closely, however, you’ll see they’re actually selling mattresses.”
But Why?
So why would a company selling mattresses feel the need to masquerade as a tech company? And what does this mean for companies that are actually rooted in technology? The chief executive of Eve is transparent about the fact that his company is indeed a tech company. He told the Guardian “Whether you think of the technology in the website, the technology used to compress the mattresses for postage or the technology of the ERP [enterprise resource planning] system that links the warehousing to the stock control.”
Catching a Competitive Edge
While anything that provides a better experience for consumers can in theory be regarded as a positive, one does have to wonder what effect this trend might have on tech companies. The investment ecosystem in Silicon Valley is already incredibly crowded, with an ever-growing list of companies eager to hawk their ideas to the most moneyed backers. If traditional retail and product based companies get into the mix and act as though they’re changing the world in the same way that a company with a genuinely new idea or approach is, it can provide an unfair amount of competition.
However, the enthusiasm to back these tech-companies-that-aren’t-actually-tech-companies may just be a function of investors’ interests. As TechCrunch reported on the rumor that San Francisco coffee brand Blue Bottle had secured another round of investment: “Silicon Valley’s — and San Francisco’s — adoration of coffee knows no bounds, and that extends even to the investor community, with tens of millions of dollars being poured into companies like Blue Bottle Coffee and Philz.”
Indeed, companies like Blue Bottle and Casper can’t necessarily be faulted for packaging and framing their ideas in a manner that is consistent with the consumer ethos and thus going to be attractive to investors. But that doesn’t mean they don’t represent a serious threat to Silicon Valley startups who are offering something that is strictly tech-driven.