The Ability to Seek Advantages and Avoid Disadvantages Is Written into Human Genes

The Importance of Interpersonal Relationships

Listening to Professor Ma Xiao talk about “In the Battle for High-Speed Rail, Why Did Some Places Succeed While Others Failed,” several points mentioned were very insightful:

1. Political science studies the rules of scarce resource allocation.
2. KPI assessment is the root of the efficient operation of the Chinese government.
3. Not only does China have a battle for high-speed rail, but Japan also has one, and a term has even appeared: “Vote Field Attracting Iron” (using votes to attract railway construction).
4. Among all available resources, personal relationships are effective.

In fact, not only in China but on the entire planet, the biggest resource is interpersonal relationships. If a person’s circle of friends is not strong enough, it is difficult to obtain enough resources to start a business or make it big. In rural areas, if one is isolated by the clan or fellow villagers, it is difficult to gain a foothold locally. What determines a person’s interpersonal relationships is fundamentally their character. A person with character issues will likely not have many high-quality interpersonal relationships. Even resources brought by passive social relationships such as family background or schooling will be lost due to character issues.

New Energy

Countries are using the dual carbon goals as an opportunity to promote the development of their domestic automotive industries. The core of the different development paths of each country’s automotive industry is the energy security considerations based on their own energy structure. For example, China is rich in coal but poor in oil and gas, so it needs to use lithium-ion new energy vehicles to convert thermal power into transportation power. By developing electric vehicles, various photovoltaics and wind energy can be applied to new energy vehicles through the existing power grid in the later stage. Japan lacks various energy sources, so it decided to develop hydrogen fuel new energy vehicles. The “Build Back Better” Act released by the Biden administration focuses on developing lithium-ion new energy, which is also based on future energy security considerations. Even though the EU leads the world in internal combustion engine vehicle technology, countries have decided to stop producing internal combustion engine vehicles around 2035. Especially the recent Russian energy supply cut-off has made Europe and the United States more sober, realizing they must keep energy firmly in their own hands.

Methods to Expand SaaS Business

B2B software business is logically relatively simple. It has just four processes:

• Develop software
• Sales and marketing
• Provide technical support
• Create cash flow

There are many ways to expand SaaS business, but the most effective methods mainly include the following.

1. Enter the high-end market: Large customers are easier to pay than small customers and are less likely to churn. Similarly, corporate customers are of higher quality than individual customers. SaaS companies like Dropbox have developed this way. Of course, entering the high-end market is not easy. It is necessary to build enough and extensive enterprise functions in the product. At the same time, since selling to large enterprise customers is more difficult, the company needs to configure more supporting services such as sales and marketing, technical support, and legal services. If the product meets the following conditions, you can consider entering the high-end market:
   • Your SaaS product can help customers solve major needs (help customers increase revenue, reduce costs, or help companies develop more healthily), and customers are willing to pay.
   • You have the willingness and skills to plan to enter the high-end market through sales and marketing.
2. Expand product lines: Once large customers are developed, these customers are not easy to lose. In addition to the initial product needs, customers may also have new needs. You can develop more product lines according to customer needs and successfully sell them to customers. For example, if you originally provided sales management software, you can try to provide human resources and process management functions to customers. Expanding new product lines requires considering the following issues:
   • The company is good at developing products and can quickly develop new products.
   • Familiar with the industry, can make relatively accurate predictions about the industry, understand customer needs, and minimize the risk of expanding product lines.
   • Have funds to support new product development.
   • The sales and marketing team can keep up with the company’s product line expansion, quickly become familiar with the product, and sell it to customers.
3. Enter new industries: Many product functions are universal and in demand in different industries. If a function can be used in a certain industry, it can also be extended to other industries. If the following conditions exist, you can consider expanding to new industries:
   • The value proposition of the product is universal or horizontal, meaning it can be widely extended to other industries. For example, Feishu (Lark) can be used in the e-commerce field and also in the live streaming field.
   • The product or function is particularly effective for a few industries that have already been expanded into, but similar products have not yet appeared in other industries.
4. Add services: With the development of the company, many SaaS companies may expand their service business. Improving service has two benefits. First, it increases the sales price of products with poor user experience. Second, services are very easy to sell; you just need to tell the customer that you can provide deployment and implementation, and the deployment and implementation you provide will make the customer experience better. Providing services also has disadvantages: First, it will reduce the company’s gross profit. The gross profit of software business is generally 70%, while the gross profit of services is only 40%. Second, services require a large number of employees to provide support, and company management will be more complicated. Third, services may hinder product R&D. If more services need to be invested in large customers, the R&D team may not continuously improve product usability due to incentive issues. However, developing products can bring more returns in the long run. Consider adding services in the following situations:
   • Correct use of the product can significantly increase product value.
   • The product is difficult for customers to integrate or apply. It requires independent operation.
   • You really need revenue.
   • You don’t mind low gross margins and don’t worry about being seen as a service company rather than a pure software company.

Podcasts

I used to mainly use Ximalaya to listen to podcasts, but now there is less and less serious content on it. I started trying to use Apple’s built-in “Podcasts” to listen to content. The content on Podcasts is more serious and has more learning value. The main reason may be that the monetization channels for podcasts are limited, and most of the podcast authors settled on it are a group of people who love podcasts and generate electricity with love.

Published at: Aug 13, 2022 · Modified at: Dec 12, 2025