Geo tech replication

Basically a fancy term for predicting future consumer behavior by looking at another region’s data

Remember the scene from the movie Back to the Future where Biff Tannen steals the DeLorean time machine and gives his younger self the Sports Almanac with the outcome of every sporting event for the next 50 years?

Well in the next scene we see that he became extremely rich, by placing the right bets because he knew the future and the score of every game from 1950 to 2000. Any viewer would have wished at some point he had this incredible ability to see the future.

Could this happen in real life? Yes, but not the way you think. Over the years I’ve spent investing in startups, I’ve come to learn and love a model called “Geo Tech Replication”. Geo tech replication looks at specific technology adoption in one country and tries to estimate the rate in which another country will reach the same adoption levels. Only last year, Apple launched it’s Apple Pay in Israel. When I mentioned this to a friend of mine who lives in New York, he said: Duh, welcome to 2017. For him, using your mobile phone as a payment option was no longer a new and exciting technology. Since the adoption in the US was extremely high, Apple could tell it would be high in other countries. And it is.

In a study conducted by the Federal reserve bank of New York dealing with geo tech replication, they highlighted several parameters impacting the rate of adoption. These parameters include PPP (annual earning per person), type of government, Global market access and adoption of predecessor technologies. By understanding these parameters, you can predict how and when a country is open to adopting a specific technology.

Having spent the last few months analyzing a fintech startup focused on the LATAM market, we have used this specific model to estimate how fast and meaningful will their adoption be there based on how similar services have impacted another market. Working with this super exciting startup, I completely feel like Biff Tannen holding the Sports Almanac. It’s like being in the past and knowing how big this startup could be. Wanna learn more about this? We will be coming out with more details on this in the coming weeks.