Babbling VC

German Venture Ecosystem Needs an "Old Boy's Network"

2012-01-08T08:18:51+01:00

Technically I shouldn't be writing this. "Old Boy's Networks" aren't things you write about, especially if you're part of one. At the same time, I really don't have much to fear in Germany. You just don't have much in this regard. The Valley sure does and we're constantly going to be compared to or comparing ourselves to them. Like it or not, that's not the point of this post. One thing though which works wonders in the Valley is the "network" of connections you have there amongst VC's. There are very clearly cliques of funds which tend to work together on a regular basis and there are multiple such cliques. Further, you have an intertwined mesh of VC's sitting on boards of large, tech companies feeding deals back and forth amongst their networks. Dive just a layer or two deeper into large VC financings or exits of venture-backed firms to the large players and see who is connected with whom via board seats.

I know, I know, you're already probably reeling at this and thinking how could one possibly want "collussion" and "a bunch of priviledged, old, white men" running the show? Honestly, I don't want any of that. What I believe is necessary though is that funds work together to create an ecosystem. This then benefits the entrepreneur. Once this ecosystem is built, it feeds upon itself to the benefit of the system. When funds regularly work together, they can pool their resources and knowledge as well as networks to generate better returns. Further, once an ecosystem is in place and formerly venture-backed firms grow to the size where they are relevant M&A players, the ecosystem grows. This allows for ever more new start-ups to get off the ground, get funded and if successful, exit. Sure, many are left by the wayside on this journey but without such an ecosystem in place, Germany and Europe will forever trail the US.

Specifically in Germany you have the problem that very few funds have grown to scale. Basically if you look at Germany, you have Wellington, Earlybird , Rocket Internet and maybe Target who have been around for more than 10 years and have presence beyond Germany's borders, i.e. in brand, fundsize and relevance. Thereafter you have a bunch of regional players who most international funds have never heard of. Then you have the corporates, some super angel funds, more recently incubators and government entities. In total, there are quite a few funds but you definitely don't have enough for cliques to have formed and none of them can go it alone (one caveat: if the Samwers, as rumored, raise €1 billion, they sure as hell will go it alone!)

Further, you don't yet have enough companies at a scale where they can start buying smaller start-ups and generating relevant returns. When going for a trade sale, you always look first beyond Germany's border for a buyer, preferably a Google, Amazon, Facebook, eBay and so forth. Some large publishing groups are active in M&A in Germany too but the VC's don't play any role in their supervisory boards.

I strongly believe that the VC's in Germany (and Europe) need to start working closer together to inject higher amounts of money into start-ups, allowing them to be relevant beyond Germany's borders. We can't expect just the Samwers to have the balls to put 50 or 100 million Euro into a company. As long as German funds don't have the capital for such large rounds alone, they'll have to work together. It doesn't necessarily just have to be German funds. Syndication works well across borders in the EU as many of UK's and France's funds are ever more active in Germany.

Further, we need more companies which were venture-backed to grow to scale. There needs to be additional companies generating M&A exits in this ecosystem beyond just the large publishers. Finally, we need to have VC's who last more than one generation of fund in the ecosystem so relationship building evolves over years and groups can be formed. There is nothing wrong with people who work well together, i.e. the "Old Boy's Network" I'd like to see in place. It won't happen overnight and I'm confident we're on our way. Yet it's a concerted effort necessary on the part of all players in the EU game.

Know Thy Customer

2011-12-29T09:10:25+01:00

Yesterday we picked up a new car at Audi in Ingolstadt, their headquarters. For those of you who don't know, Audi offers the option to pick up your car directly at the source. There's a lot of fanfare associated with this. Germans love their cars "long time"! (Slovaks too!) Anyway, what you basically do is show up (usually in a rental car) and get your car handed over to you in their customer center. They invite you to spend a couple hours there by offering you a tour of their factory floor, access to the Audi Museum and free food and drink. All in all, it's a fun way to start off your "relationship" with your new car on the right foot. Plus, you save some money in transfer and shipping costs.

Nevertheless, here's a bit of a rant about how Audi drops the ball on something so easy to remedy. We showed up at their reception and told them we were there to pick up a car. In my opinion, here is where CRM software absolutely HAS TO BE in place and needs to shine. My g/f was the one buying the car this time. This is her second Audi. Her father has already bought two Audis. Her mother drives an Audi. Her brother drives an Audi. All of these cars have been in her father's name. Long story short, we're talking about a name associated with approximately €200,000 in value thus far. Do you think they knew this at Audi when we picked up the car? Nope! Did the level of service we received reflect in any way the fact that they knew we were repeat buyers? No! Ball dropped? Yes!

Compare this to my experience when I picked up my last Audi. Note, my car cost more than double the car we picked up yesterday. It was also my third Audi at that point and I tended to prefer S-Versions in the past. Basically, when picking up one of those vehicles, you're specially greeted by someone from Audi and are treated a tad "differrently" then when picking up a vehicle at the lower end of the spectrum. Fine, I can understand investing more time on those spending more. It's similar to either being Senator Status or "only" Frequent Traveller Status at Lufthansa. Different class of service. At the same time, a customer buying a cheaper car can be a repeat customer and have a lifetime value far greater than someone who only buys one expensive car from you.

What's the takeaway here? Basically, know your customer even before they get to you. If someone has already bought something from you, install software to make sure that you recognize him or her when they return. Audi knew we were coming that day. They give you a timeslot to pick up the car. Someone could of easily done a bit of research beforehand to make sure that when we arrived, the person greeting us had info in front of them about who we are. You wouldn't of even needed real time updates. This information could of easily been prepared and waiting for us.

In so many businesses, both online and offline, your customer introduces himself to you with their name. They are either checking in, signing in or being personally greeted by someone when entering your premises. You always have a chance to cross-check that name with your database to see who this person is. You can't imagine how much people enjoy being "recognized". If someone spends a ton of money with you, celebrate them. It's such a simple thing to do and the technology is there to do this. I can't possibly imagine why you wouldn't. Yet on a daily basis, I'm reminded of the fact that there is still so much technology to implement and so many little tweaks which allow you to outcompete your competitor. I'm sure Toyota or Peugeot or Nissan are taking note of these things and could just do a bit more to get my business. In the car world, this can be hundreds of thousands in won or lost sales. Make sure this doesn't happen to you, even if your sales amounts are lower.

Sidenote: for the first time in 10 years, I am again car-less. I spent the first three years in Germany w/o a car. Just didn't need it. I am again at the point where a car is no longer necessary. Public transport, car-sharing schemes, taxis and very simply, my bike will be keeping me mobile. Manufacturers, take note!

Hell Yeah It's Personal

2011-12-26T10:59:14+01:00

"Don't take this personally!"

Man do I hate that quote. You usually hear it as someone is about to stab you in the back, steal your win or generally screw you over in some way. I know we're suppossed to seperate our private lives from our work lives so that we have some sense of "balance" in our lives. I'm calling bullshit on this once and for all. I just don't buy it although I used to think I was able to keep my private life seperate from work. After some reflection on this during a time when I am about to embark on something new, I've decided not to even sweat it anymore. From now on, hell yeah it's personal! That's what drives me. There's a certain amount of "passion" that you can only generate when you take things personally. Your flaws appear but it's smarter to focus on your strengths and find others to do what you can't.

It's a pretty simply decision for me. I like to win. More importantly, I hate losing. There's no shutting off when something goes wrong. I don't walk out of the office and stop thinking about things at work. Vice verse, if something has gone all kinds of wrong in your private life, you're not just going to forget about it as soon as you walk into your office. That's fine! It's what makes us human and this work-life-balance bullshit is annoying me at this point anyway. There's no work-life balance in the sense that all these suppossed "work gurus" preach. You can either manage your life or you can't. Balance? Who the hell has balance when you think about an entrepreneur starting his business while raising two kids and so forth. Have fun discussing balance with them!

I don't need balance when I think about starting a business. I want to be thinking of solutions to problems and figuring out how to make my customers happy all while making money. Ideas come at all times and in all forms. Likewise, if I need to take care of my family or do something "personal" during the day, then so be it. The working world has changed and you "balance" things while they're up in the air, i.e. while you're juggling priorities.

I've yet to meet an entrepreneur who wasn't intense. Further, here's what's even more interesting about the most successful ones I've met. They've always had their flaws. I haven't met one person who ultimately went on to "greatness" where I didn't think at least once "what a freak"! Some were completely asocial and had no clue how to deal with people. Some were tyrants to their employees. Drinking? Yup, you had total alcoholics in the mix as well as complete straight-liners. Others were so whacky that you wondered how they manage to get around in their day-to-day lives. I'm not even going to get into the fashion and grooming defects that you see. Nevertheless, one thing that defined them all was a sense of passion for what they did and the fact that it was ALWAYS personal. They were doing what they were doing because it was A choice.....their choice.

You can argue a million ways whether entrepreneurs are born or made. Yet when you have one in front of you, the last thing you see is work-life balance and seperation of work and private life. Some choose to be entrepreneurs while others have it thrust upon them. It doesn't matter. What unites them all is that it's always personal!

Greed is Good: Start-Up Version

2011-12-20T11:40:04+01:00

If you haven't seen this scene, you've been under a rock but if not, watch it anyway.

This is Gordon Gekko from the 80's movie Wall Street. This was an awesome movie but I think what he is saying is basically a crock of shit. It's banker-speak and how unfortunate that this movie foreshadowed so much of the mess we are currently in.

Yet, I am going to address greed in terms of start-ups. In a sense, greed is good in a start-up, specifically for two reasons. First, it makes people do crazy shit. Second, it allows you to pay people with equity instead of cash. There are many other things I am sure could be considered beneficial in regards to greed but these two points stand out most for me from a founder's perspective.

Call it what you will but it's greed that will get people to work their butts off to make something happen. They may not be greedy for money but they're still greedy for something, be it power, standing, reputation and so forth. I am fine with this. Start-ups are hard and I've written enough about that fact. Nevertheless, it's almost impossible to get someone to work with or for you on a start-up unless you address some greed of theirs. The amount of time and sacrifice in connection with start-ups far outweighs the expected benefits statistically. Either someone wants to get really rich (see below)......become a "player" in the market (give them a big role)......be seen as successful (put them on stage)......change the world (let them develop products)......whatever. Find out what they're greedy for, give them a chance to get it and you may just be able to land them for your business (see this post too about not confusing who is an employee and who is an entrepreneur).

Second, it's greed that lets you pay with equity. Sure, you have to offer some form of a base salary. People do have their basic needs. Yet it's greed that allows you to give your early employees a share of the pie when you exit instead of paying them richly up front. You don't have much money when you launch a business. Further, even if you do raise money, you have to be frugal spending it as you never know how long until you are profitable. Therefore, the crazies mentioned above whom you've brought on board can be paid with shares. Does it get any better? Hell no! You offer them a promise. A promise that their hard work will grow the company, in return growing their share of the spoils.

BUT, and there's always a "but" involved, being greedy as the founder can kill you. If you aren't willing to share the wealth, if you want to always be in the spotlight, if you don't promote from within, if you don't share your time and whatnot, you are going to get killed by greed. Let your employees be greedy. It keeps them motivated. As a founder and C-level executive of your business, be magnanimous in the spoils. Let people lead, let people develop, let people earn. Share the wealth and let greed be a positive driving force.

Should VC's Be Blogging?

2011-12-15T06:36:15+01:00

Chris Dixon started my thinking about whether VC's need to be blogging. He posted a quote from Marc Andreessen, which is actually quite good, but not relevant to this post. What is relevant is Chris's quote at the end: "Man, I wish Marc still blogged!"

I, too, miss Marc's regular blogging. He wrote great things and although he wasn't consistent in his regularity, they were always really good. His partner Ben has taken up the reigns in terms of writing blog posts but he too is writing less and less. Is this a trend? Well, yes & no, if you look at it from multiple perspectives. There are only a few bloggers out their in the VC sector who regularly garner large readership, including Fred, Brad, Marc and maybe Euro-Fred as examples. On the other hand, there are a ton of blogs from VC's which are rarely posted to or are totally dead after a couple years. So what's happening here?

I have two theories. One is that said VC has some downtime and launches a blog. He plays with it for a while, has some interesting thoughts and posts them. A couple of these posts get a large number of readers so he or she continue for a while in regards to posting. Eventually though the downtime comes to an end and said VC does the math? Does the time I invest in writing bring as much reward as if I were investing this time elsewhere? This question can easily be answered by looking to see how well the VC writes and if the writing is a passion or just a tool. I believe that those VC's who continue to write do it because they love it and not because they have to. The second theory for why VC's stop writing is that they run out of ideas. It's hard to keep banging out posts which people want to read. As creative and witty as we VC's try to be, most of it has already been written. The numbers are simply against you when you look at the sheer number of VC blogs which were launched in the past 10 years. Someone out there has usually already written about everything you come up with (probably this topic too). You put your own spin on it but it's not new. This can be frustrating.

Back to the question of whether VC's should be blogging. I think the answer is yes but only if you do it because you love writing. Those VC's I mentioned above all write (I believe) because they love the practice of writing. Most of them are doing it late in the evening or early in the morning alongside their heavy work and travel schedules. Hats off to them for having the energy to keep at it. Further, a large readership does bring it's benefits and you can bet that they are generating fairly large marketing value for their funds via their blogs. On the other hand I'd bet Marc stopped blogging frequently because he's been real damn busy. Look at the funds he's raised, the team he's built, the boards he sits on and so forth. I would be shocked if he regularly banged out high quality posts on top of all this. Therefore, my answer is that VC's should blog but only because they are passionate about it. You shouldn't blog as a VC because everyone is doing it. Some people simply write poorly and have no business maintaining a blog. I write because I enjoy it. I'm always secretly planning my next book in the back of my mind and do this because it's a way to think out loud. It gives people an idea of how I tick. Finally, I hope it adds value for my readers and if not that, is at times a bit amusing.

Your Employees Are Not Entrepreneurs

2011-12-11T09:27:23+01:00

One of the most annoying things I often hear is founders telling their employees that they need to think like entrepreneurs. Or they are told they need to be more "entrepreneurial!" Don't fall into this trap thinking it'll motivate your employees in any way. Actually it probably makes them resent you and hate your guts behind your back. Yet you'll never know this because the repercussions rear their ugly head in totally different ways, i.e. job hopping, lack of motivation, gossip and so forth.

Employees know they are not the founder and they usually make a clear choice to be employees due to their own reasons be it risk aversion, lack of experience, lack of funds and so forth. Employees will be passionate about your company and they will work hard if you choose them well. Yet do not underestimate how annoying it is to be told to be "entrepreneurial" and then in hindsight to see that the equity gains all land in the founder's pocket. Sure, your employees may have options or shares of your company. This is a great way to give them a sweetener on top for their hard work. BUT this is a bonus. It is not the same as it is for you if you are the founder. You make a boatload more than they do when you successfully exit.

Treat your employees right and never forget....treat them like good employees. They want a great place to work with challenging roles which are compensated with cash and perks. If you expect to skimp on the things which make employees happy by saying they too are compensated in equity, watch out. Spend that extra buck on a nice office and get them good hardware. Throw a great Christmas party. Give praise and honest feedback so they can further themselves and their careers. You know what I mean. But don't belittle hard working and intelligent people by telling them "I am a cheap bastard who wants to increase his upside at your cost!" Translated into founder speak, that sentence reads "When we sell this company you will make millions and hence should forego salary and a proper work environment to further our team!" I wouldn't fall for that shit when looking at a job and if you have smart, motivated employees, neither will they.

It's "Alternatives" Which Make Start-Ups Hard

2011-12-02T09:05:12+01:00

There's been so much written about how hard it is to start a company and to continue to run it successfully. I couldn't agree more. If you really want to run your own business, be aware of the endless work and constant struggle. If it were easy, everyone would do it. Yet I'm a bit tired of everyone repeating again and again how hard it is.

Let me qualify that comment since I'm supporting Chris's point. I was just thinking about this the other day in regards to start-ups. We're all spoiled. The working world, if you really think about it, has become easy. If you make a bit of effort, you can always find "a job". Outside of being physically or mentally incapacitated, anyone can do it. The way the system is set up, in the Western World you are super safe as an employee and always have alternative options. Your boss can hardly do anything to you outside of fire you and even that's hard nowadays with all the lawsuits everywhere. Let's think back about a hundred years. Being "employed" meant most likely a factory job of some sort which without going into much detail sucked. Read some books about "work" back then and you'll start loving your day job real quick. Further, unless you moved to the "big city", your options for work were few and far between. Most likely you were on the farm and that was the hardest start-up of them all. God awful working hours and you didn't give a shit about making payroll. You prayed to god that you could eat regularly and you had zero other options.

Further, starting companies used to be extremely hard. Not only did you need "space", you were most likely manufacturing something. This meant you needed machinery. Thereafter, you needed people to operate this machinery. Finally you had to front all the material costs before you could sell something. People who weren't already somewhat successful had no chance of every really starting a business. Banks wouldn't lend to you and the competition could easily stifle any progress you made quite easily once you were out of the gate. Corruption was extensive hence playing fair didn't work all too well either. Not much of a choice.

Let's look at today's alternatives. You have a ton of choices. These "alternatives" are what makes running start-ups hard. If you go the usual path, you'll go to college, study something your folks probably recommended and then follow a pre-set career path. Yet, if you don't like that you can always go laterally into another career. All possible nowadays. Or you'll skip college, learn a trade somewhere and potentially work your way up a career ladder where you'll eventually even be managing people working for you. Finally, you can choose to be an entrepreneur. In the world I talk about, you go out and buy a laptop, a mobile phone and find some friends. You can thereafter be up and running. For potentially ¢5k you can have a working business. Regardless of what you choose, to be successful in this day and age, you have to work your ass of. When you are an entrepreneur, are about to miss your payroll, haven't had vacation in months or years and your product just isn't innovative enough, you start thinking about all your "alternatives". You DON't have to be doing this. It's HARD and often not as fun as it seemed when you were reading TechCrunch and seeing everyone become millionaires.

It's all a choice. If, as Chris wrote via the link up top, you can't imagine being happy doing anything else but starting companies, go for it. If not, go do something else. Just don't constantly sweat the alternatives as this will drive you nuts! AND, just think, running that online business sure beats shoveling shit any day of the week!

Speed Is What You Need

2011-11-28T13:27:05+01:00

If you generally watch the market in the venture capital space as I do, there's one thing you'll inevitably run across again and again. It's the need for speed! I was reminded of this again when reading about how Mike Cassidy does things. Everything is focused on speed. Get shit done fast. If it can't get done fast, skip it. Move on to the next thing.

Take a look at multiple situations where speed is necessary:

1. Fundraising (be it as an entrepreneur or a fund)

If you don't raise funds fast, it probably means something isn't right. Things that are good don't have to wait around long before people start throwing money at them. If it takes forever to raise finances or your fund, there's something not right. Yes, there are exceptions to the rule but my experience is that start-ups and funds which raised capital very quickly tended to also very quickly make use of it. If you're a start-up and that VC is taking forever to make up their mind, cancel them. Go get someone else to invest. You don't have any other options and no one else is interested? Well, you probably suck. Go back to being an employee. You're a VC and LP's can't make up their minds and keep telling you to come back once you can show more? Skip them! You're in a death spiral if they make you come back more than one or two times and it's clear they are never going to invest unless 10 others lead ahead of them. You believe it's normal to take two years to raise a fund? Andreessen Horowitz sure as hell doesn't. They've friggin' raised three funds already in less than two years and we're talking over $1.5 billion in aggregate. That's your competition!

2. Hiring

In both directions, hiring needs to go fast. You want to tell someone to wait around for you and you seriously think they are good? Are you out of your mind? If you find someone you want on your team, get them on your team. Do everything possible to make them hungry for the job. Pay them well! Don't be greedy about this either. Good people have options and if you don't get them on board and motivate them as fast as possible, your chances of getting them diminish by the day. Same goes for the job seeker. If you want to work for someone and they just can't make up their mind on whether to take you or not, move on. If an employer is taking long to make up their mind about you, they probably don't give enough of a shit about you. You want your employer to have a hard-on for you. This will make you spring out of bed and run to work to do your best. If you aren't good enough for the job, go find a job where you can crush it! There's always one that you'll excel at where you'll have a boss who loves you and snaps you up as fast as he can.

3. Partnerships

The same goes for partners. You want things to kick off quickly. Working together needs to be something both are looking to be doing a.s.a.p. If you need to negotiate forever and get every "i" dotted and "t" crossed, there's trouble ahead. You can iron out the details in hindsight. When it comes to partnering, get to partnering. Let the lawyers take care of things alongside the process or in hindsight. If you take forever to just get started, think about how crap everything will be when things go wrong. That partner can become your worst nightmare.

4. M&A

M&A is always a place where time is not on your side. Sure, you can squeeze out some extra value at times but usually more gets squeezed out of you. If you can sell, and the price is right, do it! Note, I said price is right. Don't jump at any and every offer. Yet, if it makes sense, the valuation is in everyone's favor and you can quickly get people to sign off on it, go. If you have to spend half a year getting everyone on board and then another couple months finalizing things, you're screwed. The buyer will always find reasons to drop the valuation and some schmuck will always turn up in your investor ranks who is going to try to screw you. You see M&A? Get on it and drive it. I rather worry in hindsight about potentially having been able to get more instead of being pissed off about getting nothing.

5. Firing

Same as for hiring, you have to be fast when firing. It's never pleasant and sucks for everyone, even if you're getting rid of a bad apple. It tends to diminish morale as people hate to actually see firing taking place. Therefore, do it quickly. Don't let anyone who isn't up to par stick around too long. Help them by getting them out the door and on to whatever they can shine at. Vice verse, get them away from your best employees whom they are most likely to demotivate. This goes both for employees as well as C-level employees. I like to often repeat a phrase I heard somewhere along the way: "You never in hindsight fired a CEO too early!" Think about it. Makes sense, doesn't it.

6. Launching Products

I'm just repeating Mike here but it can't be repeated enough. Keep launching products, features and updates. Get shit out the door. It's always better to have it out the door and improve it as you go. Sure, there are times when you want to really polish things before launching but 9 out of 10 times, it isn't the case. You're better off to err in favor of launching too fast instead of too slow. The market is hyper-competitive and you have to outshine the rest. Get it out the door, now!

I could keep going on and on about this but you get my gist. Be fast and you'll be happy with the results. Even if you aren't happy with what happens, you can adjust and try again. That's what it's all about in venture.

Insights into the CEE Venture Market

2011-11-25T18:03:14+01:00

I was recently asked to moderate the Slovak Start-Up Awards in Bratislava, which I gladly agreed to do. I was more than happy to see such an event take place in my home country and was pleasantly surprised by the turnout and quality of the event.

The main sponsors were Neulogy, Dell, Sario and KPMG. This was a contest to choose 4 companies which would be sent to California to spend time at the Plug & Play Tech Center. The majority of the event was taken up by live pitches from the 11 finalists. Additonally, all the sponsors spoke on stage about what they are doing in the CEE region and I moderated a panel of investors and an entrepreneur from Slovakia. The final keynote was the Minister of Economics from Slovakia, Dr. Juraj Miskov, who unfortunately was the only participant to speak in Slovak instead of English. This was a bit odd since after the event I clearly heard him speaking English and German fluently.

If you're interested in the region, take a look. It was good to see so many companies apply for the award and to hear the finalists pitch their business case.

Startup Awards.SK 17.11.2011 from Neulogy on Vimeo.

P.S. I had no involvement in choosing the music. Just be aware of that! :-)

Where There's Fire, There's Smoke: Kindle Fire Review

2011-11-25T09:33:17+01:00

Instead of going into the details, I thought I would just give my thoughts regarding the Kindle Fire from a user perspective. Namely, me being said user. The reference to smoke above is basically what I consider a lot of reviews to be. Far too many people are reviewing the Fire as a competitor to Apple's iPad. I specifically bought the Fire to replace my iPad.

Why did I end up passing on my iPad to my girlfriend? Basically because I have a Macbook Air with 11" screen. It's almost silly to travel with both that laptop and an iPad. At the same time, the iPad alone was often not enough, especially when you want to write some longer mails or blog posts. What I wanted was a device to use for reading. I had originally had the second generation Kindle. That was handed off to my sister (noticing a trend here?) I replaced that device thinking I wanted the Kindle I originally had to do more. Yet, the iPad I bought to replace it ended up being overkill. Enter Kindle Fire! What is the Kindle Fire? A perfect transportable reading device which allows you to now and again jump over into the browser or mail app to catch up there. I won't be "working" with the Fire. Yet, while reading, I can easily check mails or websites to see what's up. Further, I can lay on my back in bed and read using one hand to hold the device. Sure, you can't do this all night long but people, some books are heavier than the Fire. No shit that holding even those for a longer period of time will put strain on your arm. Further, there are some cool apps already available for the Fire like Pulse which allow me to read RSS feeds just fine. That's enough. The Fire doesn't have to do anything more. For 200 bucks it's perfect.

Does it have any drawbacks? Well, there are some quirks. I find battery life to be ok but it's nowhere near what a regular Kindle is capable of. I believe even an iPad may have a bit more battery life yet I didn't do any parallel testing. Further, I'm not a video guy. If I watch a movie, I want it to be on a big screen. The screen on this device is a bit small yet in a plane, sure, one movie is fine. I won't be doing any marathon movie nights on this thing though. I also find the button on the bottom just plain dumb. I keep hitting it and turning the device off. This was plain stupid design. The screen, just like the iPad, gets muffed up with fingerprints real quick. You definitely need one of those Power Support screen protectors to keep the screen from gunking up. Finally, and this is really dumb of Amazon, is the charger. It's a one piece, non-usb charger. (You probably will have a country specific plug on it depending on where you buy and yes, I had to go out and buy a Micro-USB B to USB cable to charge the device.) Why isn't this USB cable included. Sure, everything is supposed to go over-the-air but why would I want to carry ANOTHER charger with the Fire? 99% of the people will switch to a charger with a USB plug (which Amazon surely wants you to order via their site) and this doesn't make sense to me.