Anker CEO Steven Yang is all in on USB-C

Nilay interviews Steven Yang, Founder and CEO of Anker. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Nilay Patel?

  This episode of The Vergecast is brought to you by ZipRecruiter. Have you ever uploaded all of your photos to iCloud by accident? That's not smart. But you know what is smart? Hiring with ZipRecruiter. ZipRecruiter's powerful technology finds people the right experience for your job and actively invites them to apply. So you get qualified candidates fast. That's why ZipRecruiter is rated number one by employers in the United States based on TrustPilot rating of hiring sites with over 1,000 reviews. Now, Vergecast listeners can try it for free at ziprecruiter.com/verge. That's ziprecruiter.com/verge. ZipRecruiter, smartest way to hire. On this week's interview episode, I talked to Stephen Yang, who is the CEO of Anchor. Anchor is a company that kind of came out of nowhere. We profiled them a little bit earlier this year. They started out making replaceable batteries for phones. And now they're just the default brand of USB battery packs, accessories that make headphones, that make robot vacuum cleaners.

• 0:44Nilay Patel?

  And they built this business entirely on Amazon, which is wild. And so we talked to Stephen Yang about that. That was really fun. But really, we talked about USB-C and how Stephen Yang and Anchor are all in on USB-C. In particular, there's a material shift happening in this world from silicon to something called GaN, gallium nitrite, which enables USB-C power delivery bricks that can do like full-on power delivery to a laptop from a charger the size of the iPhone charger. And that's what they released. It's called the Anchor Atom. I mean, it's a USB-C brick, but trust me, it's super cool. It's really small. So we talked about all of that. And I will tell you, I've never met anyone in my life who's more excited about USB-C than Stephen Yang. And I know Dieter Bohn. So check it out. This is really fun. Here we go.

• 1:27Nilay Patel?

  Okay, we're here with Stephen Yang, the CEO of Anchor. It is Anchor, not Anker. I feel like it's a word people see on the internet and they don't often hear. This is your first big event in New York. We're actually, for Vergecast listeners, we're not in the studio. We're backstage at the event. You're about to have a rehearsal. Congratulations on your first event.

• 1:46Speaker 01

  Well, thank you. Thank you really, you know, for taking the time and speaking with us.

• 1:49Nilay Patel?

  Yeah. Anchor is a remarkable company. We covered you guys. We wrote a feature about Anchor several months ago. Came out of nowhere. You kind of dominate this accessory business for phones with batteries and chargers.

• 2:02Speaker 01

  I don't know we necessarily dominate, but I think we do, you know, play an important, you know, try to play an important role in this field.

• 2:08Nilay Patel?

  Yeah. And now you're having an event, which is... You don't think about the battery pack company having an event, which is so cool. Tell me the story. How'd you guys start? Where'd you come from?

• 2:18Speaker 01

  So this was back into 2011. So I was actually working as a software engineer at Google. Well, I was looking actually for a laptop battery to actually to replace the one. I mean, that's been my laptop for a long time, right? And then I went online and I realized that I was actually into a dilemma. So there was, I mean, the batteries from the manufacturer, which would cost me a small fortune. Then there was also, you know, the batteries from third parties, which are not having good review ratings by previous buyers. I realized it's a common issue. And so I thought, hey, it seems like an opportunity and let's try to work on it.

• 2:58Speaker 01

  Well, in 2011, I moved back to China and started Anchor with a few colleagues at Google and also my fiancee Diane. With a team of engineers, we tested and actually found, you know, the best laptop charging accessories. And we, you know, sold them directly to US consumers online on amazon.com.

• 3:18Nilay Patel?

  Yeah.

• 3:19Speaker 01

  So this turned out to be a success. So we actually sold half a million products in our first year and got a review rating that's 4.3 stars out of 5, which is way above the average of the industry. And then we're profitable.

• 3:33Nilay Patel?

  In one year?

• 3:34Speaker 01

  In one year.

• 3:35Nilay Patel?

  That's great.

• 3:36Speaker 01

  Right. So we realized that we seem to have found the success formula. So now it's actually to take it and apply it to a bigger problem. We're looking at mobile. With the increasing popularity of gadgets with smartphones, smart, you know, tablets and so on and so forth. It was clear that charging has become a problem. It was slow charging speed, short battery life, easily broken cables and so on and so forth. Right? And there's no great solution to this. So we felt that we could really make a difference, not only through, you know, price point and through just quality, but through our own innovative technology. So that's why we actually set up our first R and D center in Shenzhen. That's, I think, May 2012.

• 4:22Speaker 01

  So it was, well, a hell of a journey.

• 4:26Nilay Patel?

  And so now you're here and you have some new products you're announcing.

• 4:29Speaker 01

  Yep.

• 4:29Nilay Patel?

  Today.

• 4:30Speaker 01

  Yep.

• 4:30Nilay Patel?

  The listeners will hear this in a couple of weeks from today, but today you're announcing a new USB C power delivery brick that's very small, 27 watts.

• 4:39Speaker 01

  Yes.

• 4:39Nilay Patel?

  And this is something you developed in your research and development center.

• 4:42Speaker 01

  Well, partnered with manufacturers of the silicon of the GaN.

• 4:46Nilay Patel?

  What is the GaN?

• 4:47Speaker 01

  GaN is actually a new material. It's a new semiconductor material that we're think is going to replace silicon as the best, you know, material to make chargers for the next, you know, decades and hundreds of years.

• 5:00Nilay Patel?

  Wow. Why is that?

• 5:02Speaker 01

  We've been using silicon to make chargers for the past 40, 50 years and well, they're helpful, but they operate at a lower frequency. So chargers could not be made smaller. GaN, actually, this new material basically operates at a much higher frequency. So it basically adapts like five to 10 or even more times every second than silicon does. The result of that is actually a much smaller, you know, charger form factor, much less heat being produced and ultimately, you know, lower bomb to, lower bomb cost.

• 5:37Nilay Patel?

  That's bill of materials.

• 5:38Speaker 01

  Yes.

• 5:39Nilay Patel?

  So a lower cost for you and then a lower cost for the consumers.

• 5:41Speaker 01

  Yes. So, but I think, you know, initially what you're only going to see is the small form factor. The lower cost will come like several years later when that mass scale actually is reached.

• 5:51Nilay Patel?

  So your, your new product, the Atom Charger.

• 5:54Speaker 01

  Yep.

• 5:54Nilay Patel?

  That's the first GaN product on the market?

• 5:57Speaker 01

  Yes. I think that will be the first, you know, GaN products on the market, you know, for portable devices.

• 6:02Nilay Patel?

  And GaN, that's a chemical symbol that you're pronouncing, right? G A N?

• 6:06Speaker 01

  Yes. It's actually gallium nitride.

• 6:07Nilay Patel?

  Gallium nitride?

• 6:08Speaker 01

  Yeah.

• 6:09Nilay Patel?

  And so gallium nitride is going to replace silicon?

• 6:11Speaker 01

  Yes.

• 6:12Nilay Patel?

  And that's going to be the future of charging?

• 6:14Speaker 01

  Yes.

• 6:14Nilay Patel?

  And you guys want to be obviously the, the leaders of that?

• 6:17Speaker 01

  Yes. We want to continue our leadership, hopefully.

• 6:21Nilay Patel?

  So let's get really nerdy about USPC.

• 6:24Speaker 01

  Sure.

• 6:24Nilay Patel?

  I want to talk about the other products you're announcing too, but I want to be nerdy about USPC because that is in my heart.

• 6:29Speaker 01

  We should.

• 6:30Nilay Patel?

  So USPC has been on the market for several years now.

• 6:32Speaker 01

  Yes.

• 6:32Nilay Patel?

  It's been the standard in phones.

• 6:34Speaker 01

  Yes.

• 6:35Nilay Patel?

  Apple put it on the MacBook, they put it on MacBook Pro. And the USPC ecosystem, the PD ecosystem.

• 6:40Speaker 01

  Yes.

• 6:41Nilay Patel?

  Is still pretty immature and still kind of messy. Why is that?

• 6:45Speaker 01

  Well, I think it's getting better.

• 6:49Nilay Patel?

  Yeah.

• 6:49Speaker 01

  It's getting better by a lot, actually, very fast. So I'll just give you a quick example. So last year, when we were actually crowdfunding our first two wireless headsets, which was the Liberty Plus. So our online survey, I mean, we always listen to customer advices, customer inputs. Our online survey said that about 30% of people like USPC on this, you know, battery box.

• 7:12Nilay Patel?

  Yeah.

• 7:13Speaker 01

  Versus actually 40% of something like USB Microbe. At that time, well, certain people like USPC, but still USB Microbe was the majority. And the same test, the same survey, I mean, was run this year. Guess what the, you know, percentages are?

• 7:28Nilay Patel?

  I'm guessing it flipped.

• 7:29Speaker 01

  It flipped and actually not only flipped, but also USBC was like 70%.

• 7:34Nilay Patel?

  Wow. So people are getting used to it and their expectations are going to use one plug for everything.

• 7:38Speaker 01

  Yes, yes.

• 7:39Nilay Patel?

  So my argument would be the one plug is kind of confusing because you plug a laptop into a phone charger and nothing happens. Apple has Thunderbolt inside of that port. Do you think that confusion is people are figuring it out? Or do you think this is basically a charging standard and everything else is set by the wayside?

• 7:58Speaker 01

  So I think you're right on the problem. So USBC is so powerful that it contains so many protocols in it that I think we should release the monster.

• 8:08Nilay Patel?

  Yeah.

• 8:09Speaker 01

  Right? That could bite back because people are, could be like confused by that, you know, cable, that port. And some will do charging and some will do like display and some will do network, right? And some will even do audio, but they have to match specifically which is doing which.

• 8:28Nilay Patel?

  Right.

• 8:28Speaker 01

  Right? It's not that, you know, they're all like functioning at the same time. That's going to definitely cause a challenge. So I think there are actually discussions upon, you know, um, taking some of the protocols out.

• 8:39Nilay Patel?

  Really?

• 8:40Speaker 01

  Yes. I mean, that's in the standard consortium, right? But I think eventually still for charging USB C is the way to go.

• 8:47Nilay Patel?

  Yeah.

• 8:47Speaker 01

  I think that's pretty much the, um, you know, consensus.

• 8:51Nilay Patel?

  I mean, I, I've always found it remarkable that the USB A plug is the most standardized power socket in the history of the world. And it is not.

• 9:00Speaker 01

  It was.

• 9:00Nilay Patel?

  It was, and now hopefully it's going to be C.

• 9:03Speaker 01

  Yep.

• 9:03Nilay Patel?

  But before that, I mean, the USB A plug is everywhere.

• 9:07Speaker 01

  Yes.

• 9:07Nilay Patel?

  And traveling internationally now is like

• 9:09Speaker 01

  Yes.

• 9:09Nilay Patel?

  far easier than it ever was before.

• 9:11Speaker 01

  Yes.

• 9:12Nilay Patel?

  You know, the standardized thing. So you can see how making USB C more powerful and more able to do laptops and that sort of thing would work. But again, that ecosystem is only just beginning. Do you think gallium nitrate GaN is going to help that go faster? Do you think that making the thing smaller is, how do you, how do you see that playing out?

• 9:30Speaker 01

  Well, if you look at the history of USB A, right? So first introduced back in nineteen ninety six. The charging only start to really take place, I think, almost ten years after. Initially it was like two point five or five watt. Slowly it, you know, increased up to fifteen watt. So that took almost twenty years to basically get USB A to where we are today. But I think USB C is going to be much faster.

• 9:54Nilay Patel?

  Yeah.

• 9:54Speaker 01

  First of all, it delivers like much more power through the same port, right? It's up to a hundred watt. Versus actually USB A is like fifteen. That protocol, again, as we talked about, is, is powerful enough to actually also host other protocols. There's one actually hope that we really, you know, have, not only at Anchor, but I think also shared by others in the industry. That's really to turn, you know, um, the chargers from majoritely being shipped inbox. To actually majority being like bring your own charger.

• 10:27Nilay Patel?

  Really?

• 10:27Speaker 01

  Yeah.

• 10:28Nilay Patel?

  Why's that?

• 10:29Speaker 01

  So a quick number, actually. How many chargers are being shipped every year?

• 10:33Nilay Patel?

  Well, I mean, Apple ships like a hundred million iPhones, so it's like a hundred million right there.

• 10:36Speaker 01

  Two, actually. I think it's two hundred million.

• 10:38Nilay Patel?

  Two hundred, okay, so it's two hundred just from Apple.

• 10:39Speaker 01

  Yeah, it's two hundred million, you know.

• 10:41Nilay Patel?

  And they they're still doing five watt chargers.

• 10:42Speaker 01

  So how many of these chargers do you have at home?

• 10:44Nilay Patel?

  Yeah, so I wait, I'm just gonna guess. So it's just two hundred million Apple alone.

• 10:47Speaker 01

  Yeah.

• 10:48Nilay Patel?

  Five hundred million chargers.

• 10:49Speaker 01

  No, actually. So if you look at every smartphones has a charger that ships with it, right? So we had about one point five billion smartphones last year.

• 10:58Nilay Patel?

  One point five billion chargers shipped last year.

• 11:00Speaker 01

  That's only for phones.

• 11:01Nilay Patel?

  That's crazy.

• 11:02Speaker 01

  And then you're counting the, you know, uh, tablets, the laptops, your power drills, right? And your like, you know, um, other gadgets which could come with adapters too.

• 11:12Nilay Patel?

  Yeah.

• 11:12Speaker 01

  So we estimated a total of like four billion chargers.

• 11:18Nilay Patel?

  Wow, my guess was super wrong.

• 11:21Nilay Patel?

  It was it was much lower than I anticipated.

• 11:22Speaker 01

  Actually, there's one thing I think you'll definitely be right of. So do you have a box or drawer at home that have all save all the same old chargers?

• 11:28Nilay Patel?

  Oh, do I? Yeah, of course. My my wife hates this box.

• 11:31Speaker 01

  Right, so I think that box will go away.

• 11:34Nilay Patel?

  You think so?

• 11:35Speaker 01

  With USB C, with power delivery and with scan.

• 11:38Nilay Patel?

  Because everything will be standardized.

• 11:40Speaker 01

  Yes. I mean, the same set of chargers will be able to use repeatedly to charge all the devices that come into your household.

• 11:47Nilay Patel?

  Okay, so that's a beautiful vision.

• 11:49Speaker 01

  Yeah.

• 11:49Nilay Patel?

  Right now, today.

• 11:50Speaker 01

  Yeah.

• 11:51Nilay Patel?

  One of my favorite products you make, and I have three of them in my house.

• 11:53Speaker 01

  Yep.

• 11:54Nilay Patel?

  Is uh, the USB power brick.

• 11:56Speaker 01

  Yes.

• 11:57Nilay Patel?

  So plug in the wall, I get ten USB A ports.

• 11:59Speaker 01

  Yes.

• 11:59Nilay Patel?

  It sits on the on the nightstand.

• 12:01Speaker 01

  Yes.

• 12:01Nilay Patel?

  It's like everything in at night.

• 12:02Speaker 01

  Yes.

• 12:03Nilay Patel?

  Why can't I get one of those with ten USB C P D ports?

• 12:06Speaker 01

  That's again because.

• 12:08Nilay Patel?

  Because you make one that has five USB A and one P D.

• 12:10Speaker 01

  Yes, that's because of the power density that silicon is able to make.

• 12:15Nilay Patel?

  Okay.

• 12:15Speaker 01

  Does not really meet the need of the USB C and P D.

• 12:18Nilay Patel?

  Okay.

• 12:18Speaker 01

  Right, so um, that power brick actually that you have packs about sixty watt of power.

• 12:23Nilay Patel?

  Mm hmm.

• 12:24Speaker 01

  That's okay with USB A because each port only takes like fifteen watt.

• 12:28Nilay Patel?

  Yeah.

• 12:28Speaker 01

  Maximum, right? But if you look at USB C, each port itself could take up to a hundred watt.

• 12:33Nilay Patel?

  Wow.

• 12:34Speaker 01

  Right, if you put ten ports over there, so what's the maximum power this adapter should have on its own? At least like two, three hundred.

• 12:42Nilay Patel?

  Yeah.

• 12:43Speaker 01

  Right, today, if you're making it with silicon, that will be like a huge break. But actually, that's the merits, the benefits of GaN is that with GaN, this could be made much smaller.

• 12:54Nilay Patel?

  Right.

• 12:54Speaker 01

  So I think in the future, like we'll see chargers like you just mentioned, which have multiple USB C ports. That's ubiquitous. So you don't need to, you know, like actually read which port does the fast charging, which port does not. Just plug any device into any of this and it will just fast charge your device.

• 13:13Nilay Patel?

  So I saw on the table outside, I definitely spied on your new product, where we came in. Um, I saw on the table outside, you have the Atom, the little one.

• 13:21Speaker 01

  Yes.

• 13:21Nilay Patel?

  Which is not much bigger than, say, the, for the listener, not much bigger than, say, the pack in Apple charger.

• 13:26Speaker 01

  The five watt.

• 13:27Nilay Patel?

  And that can do 27 watts, it can run a switch, it can power a MacBook.

• 13:31Speaker 01

  Yes, and lots of things.

• 13:33Nilay Patel?

  Yeah, but 27 watts, so it's like, just to give a frame of reference.

• 13:35Speaker 01

  Yeah.

• 13:36Nilay Patel?

  You now have a charger that's the size of Apple's.

• 13:38Speaker 01

  Five watt.

• 13:39Nilay Patel?

  Five watt, I have an ubiquitous iPhone charger.

• 13:41Speaker 01

  Yes.

• 13:42Nilay Patel?

  That can charge a MacBook. So that's remarkable.

• 13:44Speaker 01

  Yes.

• 13:45Nilay Patel?

  And then next to it, I saw the thing I want, which is the brick that has two USBAs and two USBCs. Is that also running, is that a GaN product?

• 13:54Speaker 01

  That's actually my favorite too. So that actually, uh, for charger, which is still smaller than like, um, Apple's 60 watt charger. Packs two USB C port and 60 watt of power that can be dynamically allocated between the two ports.

• 14:09Nilay Patel?

  Yeah.

• 14:10Speaker 01

  Right. Which means if you're plugging one device, it could take up to 60. And if you're plugging two, it will smartly allocate power between the two. So this really like, again, if you're traveling or if you're, for example, taking your phone and your MacBook. You can plug both of them at the same time and they'll just draw power. It's just so convenient.

• 14:28Nilay Patel?

  Yeah. So let me zoom out a little bit. So this is very cool. It's very nerdy for us. And I know the Verchast audience is just as nerdy as we are, so I'm sure they're excited too. But just zoom out a little bit.

• 14:39Speaker 01

  Yep.

• 14:40Nilay Patel?

  A normal person goes into an Apple store or they go into the Microsoft store or Best Buy or something. They buy a new USB C laptop. How do they know what will charge it and what will not? Because the cables do all look the same. How do you think about educating the consumer about what they need? Beyond saying this is 27 watts, or this is 50 watts, or this is 100 watts? Because that is obviously still pretty opaque.

• 15:02Speaker 01

  I think my ideals, you know, way would just be let users forget about it.

• 15:06Nilay Patel?

  Yeah.

• 15:07Speaker 01

  Right? They can plug in any port and it would just fast charge. It would just be enough power for the device. But I think we have to, again, go through various stages and finally reach that vision. So initially, I think you're still going to see like USB C plugs with different wattage ratings. And you pick the right one to fit your device. But later on, as you start actually to deploy the smart USB C port, which share the same, you know, 100, 200 watt. Then I think you no longer have to worry about, am I plugging to the right power?

• 15:37Nilay Patel?

  Yeah.

• 15:37Speaker 01

  Or not?

• 15:38Nilay Patel?

  How long, how far away is that? Is that a year away? Is that five years away?

• 15:41Speaker 01

  I'd hope it to come like within two to three years. Definitely for the, you know, for the nerdy customers.

• 15:47Nilay Patel?

  I mean, that's what, that's what we have.

• 15:48Speaker 01

  Because today, actually, uh, so for the nerdy customers, we already have the 100 watt. That's the PD4, the Atom PD4, which packs 100 watt of power that can be distributed between two USB C port and two USB A port.

• 16:01Nilay Patel?

  Yeah.

• 16:01Speaker 01

  Right? Get that stuff at home and you don't worry about, you know, which port you're plugging.

• 16:05Nilay Patel?

  Yeah. So that's USB CPD, which I am very interested in. I'm very excited to get the new stuff.

• 16:11Speaker 01

  Thank you. I think you're doing a great thing, you know, again, so to push, I mean, there's, we estimate about 300,000 tons of e-waste just because of these inbox chargers. I think you're, you know, helping to get rid of them.

• 16:24Nilay Patel?

  Just by buying them, uh, I mean, just getting them off the market myself personally.

• 16:29Speaker 01

  Yeah.

• 16:29Nilay Patel?

  So how do you, do you go to an Apple and you say, hey, take this junky five watt charger? Just stop putting it in the box. So our friend Joanna Stern at the Wall Street Journal, every year she reviews the iPhone and says, why do I have this garbage charger? I'd prefer you give me the, a fast charger. I'd prefer you just let me use an iPad charger. I don't need this anymore, but you still ship it in this box. Do you go to Apple and say, hey, just let us do it? Just, you know, sell the iPhone and then have a row of anchor 27 watt bricks over there if you need it?

• 16:58Speaker 01

  Well, I. I hope so. I mean, not only Apple, but also like all the major, um, you know, device manufacturers out there, right?

• 17:05Nilay Patel?

  Yeah.

• 17:06Speaker 01

  We'd hope them to stop shipping all this, you know, low voltage chargers and just divert consumers to actually the third parties, which could really, you know, work for a very long time.

• 17:15Nilay Patel?

  Yeah. And so you'd buy the higher powered charger, you'd plug it in, it would automatically recognize your device and deliver the appropriate amount of power.

• 17:20Speaker 01

  It's worry free, it's bring your own charger, and it's the same set of chargers like for ten years and even longer.

• 17:26Nilay Patel?

  Yeah.

• 17:27Speaker 01

  So that's the easy way, I think, to do it.

• 17:29Nilay Patel?

  Do you think we're ever gonna come to a place where we get rid of these sort of like hundred and ten volt AC terminals in our wall? And just replace everything with USB C?

• 17:36Speaker 01

  That's a great question. I think I can see that actually maybe half of the house, the wall outlets like being replaced by just USB C outlets, right? But I think still like for bigger like, you know, things like refrigerators and so on and so forth, we're probably still gonna need a USB, uh, sorry, AC outlet.

• 17:55Nilay Patel?

  Yeah.

• 17:55Speaker 01

  But this is probably AC for limited location in your house.

• 17:59Nilay Patel?

  Can you run like a, like a TV off of USB C?

• 18:02Speaker 01

  Yes, you can.

• 18:03Nilay Patel?

  You can?

• 18:04Speaker 01

  So, uh, let's see, USB C actually delivers up to one hundred watt today, right? So I think that at least feeds most of the TVs on market today.

• 18:12Nilay Patel?

  Mm hmm.

• 18:12Speaker 01

  But I think again, USB C is, it's one hundred watt because today we're still only, you know, tackling the phones and the tablets and the laptops market, right? As that's become sort of taken, as they move upstream, I don't see, you know, challenges for USB C to deliver, you know, up to two hundred, three hundred watts.

• 18:31Nilay Patel?

  Really?

• 18:31Speaker 01

  Sure. So that's the time, I think, almost everything in the household could come into, you know, directly to power from this point.

• 18:38Nilay Patel?

  That's amazing. So you have become this large accessory brand on Amazon. Is that where your business is? Do you wanna go elsewhere? Do you diversify that? Like, is that, is Amazon a risk to you or do you still see as an asset?

• 18:52Speaker 01

  No, I mean, we see tremendous value actually for offering our products directly to consumers. But we also actually realized that there are customers who like to buy from their, you know, local outlets.

• 19:03Nilay Patel?

  Mm hmm.

• 19:03Speaker 01

  So that's why we partnered with Walmart and Best Buy and for example, just to, you know, bring our products to their local outlets. So they can just grab them, you know, when they want to, right? So, uh, I think as a brand, we the hope to be omnichannel.

• 19:18Nilay Patel?

  Yeah.

• 19:18Speaker 01

  We'd hope to be, you know, anywhere you would like to get the stuff.

• 19:21Nilay Patel?

  But I've noticed that people have seen your success.

• 19:24Speaker 01

  Yeah.

• 19:24Nilay Patel?

  When other sellers on Amazon see success, they come swarming in. This is a classic story.

• 19:29Speaker 01

  Yes.

• 19:30Nilay Patel?

  Amazon itself will be like, Amazon Basics, here we go. Like, do you worry about that? Do you think that, you know, you've got some competitors that are making very similar products to you?

• 19:40Speaker 01

  I think-

• 19:40Nilay Patel?

  Does that drive you crazy? Or are you just like, screw it?

• 19:42Speaker 01

  Consumer electronics is never short of competition. Right? Over the past, like, you know, several decades, like, it's probably the most competitive field in the world ever. So I think, again, just our value is really to listen to our customers and deliver value to them.

• 19:59Nilay Patel?

  Yeah.

• 19:59Speaker 01

  That's our principle. We really pay very close attention to actually what customers, you know, feedbacks are.

• 20:05Nilay Patel?

  Mm-hmm.

• 20:05Speaker 01

  Right? They like about us, they don't like about us. And I think as long as they like about us, I think we're, we're okay.

• 20:14Nilay Patel?

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• 20:22Speaker 02

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• 20:25Speaker 03

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• 20:29Speaker 02

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• 20:45Speaker 03

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• 20:53Speaker 02

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• 20:55Speaker 03

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• 20:59Speaker 02

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• 21:07Speaker 03

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• 21:17Speaker 02

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• 21:22Speaker 03

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• 21:42Nilay Patel?

  Thanks to our sponsors, ZipRecruiter, back to the show.

• 21:46Nilay Patel?

  Anchor has also diversified, right? So you have a line of speakers called Soundcore.

• 21:51Speaker 01

  Yes.

• 21:51Nilay Patel?

  You have a line of home products.

• 21:52Speaker 01

  Yes, called Ufi.

• 21:54Nilay Patel?

  Ufi, I was gonna say, it's another word I only read and never say out loud.

• 21:57Speaker 01

  Yes.

• 21:57Nilay Patel?

  So Ufi.

• 21:58Speaker 01

  Yes.

• 21:59Nilay Patel?

  Are those as big of bets as the sort of charging and battery packs? Are they just, it's pretty easy to make this stuff?

• 22:06Speaker 01

  I think every different device type poses a unique challenge and often and usually a different challenge.

• 22:12Nilay Patel?

  But do you think Soundcore can go defeat Sonos and Bose? With the USB-C stuff.

• 22:19Speaker 01

  Yeah.

• 22:19Nilay Patel?

  It's obvious that you have a vision.

• 22:22Speaker 01

  Yes.

• 22:22Nilay Patel?

  That you want to be a major player, you want to push the standard forward. You're the default vendor, you have the biggest brand in that stuff.

• 22:28Speaker 01

  Yes.

• 22:29Nilay Patel?

  Is that what you're trying to do with Soundcore? Are you trying to beat Roomba with Ufi?

• 22:33Speaker 01

  So I think with charging, we would like to believe that we are actually pushing the envelope and leading the industry, right? But with other categories, we do realize actually there's a long way for us to catch up.

• 22:43Nilay Patel?

  Yeah.

• 22:44Speaker 01

  I mean, they are doing great jobs, Sonos, JBL out there. So I think we're still trying to catch our eye and really just figure out essentially for the long term, how do we want to run this business? The case is that we have independent teams in the company, each working on a category. So they're sort of drawn from the major brands and they're here to build a brand on their own. We are the same processes, we are the same philosophy that Anchor is basically built on.

• 23:13Nilay Patel?

  Yeah.

• 23:13Speaker 01

  Right? When you have a vision in your mind, when you want to build something on your own, so even if it takes time, you're going to continue to work on it.

• 23:22Nilay Patel?

  Yeah.

• 23:22Speaker 01

  So that's why you see actually, take Audio for example, we started four years ago with a Bluetooth speaker that's actually, I think it's unique in a way that it actually packs about 16 hours of battery life, which is kind of Anchor's advantage.

• 23:36Nilay Patel?

  Yeah.

• 23:36Speaker 01

  But then over the years.

• 23:37Nilay Patel?

  Your advantage is that you build the batteries. I like it, that's pretty good.

• 23:40Speaker 01

  Yes. Over the years, we really morphed into, really developed into building great sound, not only just great battery life, right? So that's that's a slow process, but we're trying to get there.

• 23:53Nilay Patel?

  Yeah.

• 23:53Speaker 01

  Yeah.

• 23:53Nilay Patel?

  You announced a projector or you will be announcing a projector here.

• 23:57Speaker 01

  Yes.

• 23:58Nilay Patel?

  What's really interesting to me is you're you're putting that on Kickstarter. Is there a reason that you take some products and you say, let's do crowdfunding? Is it just to build hype? Do you actually need the capital? Like, why go to Kickstarter with some products?

• 24:08Speaker 01

  I think for one thing is I want to continue the the way of our product development, which is listening to customer feedbacks. So putting on crowdfunding really enable us to listen to feedbacks earlier.

• 24:18Nilay Patel?

  Yeah.

• 24:18Speaker 01

  Instead of having everything ready and just, you know, unveil it. And second thing is really, I think, having the first, you know, group of customers at the word of mouth really help us to bootstrap a category. Because we at Anchor, we don't usually, you know, spend a big, you know, money on, you know, marketing and bootstrapping a brand, right?

• 24:36Nilay Patel?

  Yeah.

• 24:36Speaker 01

  Would rather pass that actually through the crowdfunding to the initial customers.

• 24:41Nilay Patel?

  Yeah.

• 24:41Speaker 01

  So they get a much discounted, you know, products and they help us to actually spread a word of mouth.

• 24:47Nilay Patel?

  That projector, we're very excited about it because the previous version, I think Ashley Carmen or one of our reporters had picked it as the one to get. So this is the new one. So do you still need, even if you already have one that's pretty successful, you still think you need to to crowdfund the second one?

• 25:02Speaker 01

  We haven't, you know, succeeded in disrupt this category yet.

• 25:06Nilay Patel?

  Okay.

• 25:06Speaker 01

  Right? So our customers, I mean, they like the first version, but they still have regrets.

• 25:11Nilay Patel?

  Yeah.

• 25:12Speaker 01

  For example, like, as resolution is still like not optimal. So the content in there is still not optimal.

• 25:18Nilay Patel?

  Yeah.

• 25:19Speaker 01

  So we listen to their advices and then we work on a new version, which try to fix this. So this one's coming with actually HD in 720p. And then it's coming with Android TV, so it's native content.

• 25:32Nilay Patel?

  Oh, cool. So speaking of new product categories.

• 25:35Speaker 01

  Yeah.

• 25:35Nilay Patel?

  One of my reporters noticed that you have a LinkedIn job opening.

• 25:38Speaker 01

  Yeah.

• 25:39Nilay Patel?

  For a product manager for e-cigarettes. Is that something that you're aggressively going to pursue?

• 25:44Speaker 01

  Is you only have one opening for it. So that's not aggressively being pursued, right?

• 25:49Nilay Patel?

  Okay.

• 25:49Speaker 01

  So it's an area that we're trying to fill out. Yeah, there's no big plan for it.

• 25:53Nilay Patel?

  Yeah, do you think there's like a like an ethical problem with making a you know, Juul exists and are obviously huge?

• 25:59Speaker 01

  Yes.

• 25:59Nilay Patel?

  And they're like a three billion dollar company, which is crazy. And now they're running into like regulatory issues.

• 26:05Speaker 01

  Yes, yes.

• 26:05Nilay Patel?

  Do you think that's a problem that you just don't want to deal with? Or is that something that you're you're chasing after?

• 26:09Speaker 01

  Well, so I I don't smoke.

• 26:12Nilay Patel?

  Yeah. I wish I didn't.

• 26:13Speaker 01

  I kind of got sort of like secondhand smoking like several times a week.

• 26:18Nilay Patel?

  Yeah.

• 26:19Speaker 01

  Right? And that really bothers me. So I think what I like about e-cigarette is that that secondhand smoking is almost like not.

• 26:27Nilay Patel?

  Yeah.

• 26:27Speaker 01

  Right, it's basically reduced to to minimum. So I think that's sort of helping me, whereas actually helping the smoker, you know, himself too.

• 26:35Nilay Patel?

  Yeah.

• 26:36Speaker 01

  Right? So I do see benefits in there. But again, I think we'll have to figure out what value can we bring to the table? We don't want to just be like yet another company, you know, doing this. And we definitely don't, you know, want to do it just, you know, for a profit or whatever. We think, again, adding to the public welfare is definitely, you know, the minimum that, you know, we have to start from.

• 26:56Nilay Patel?

  Yeah.

• 26:56Speaker 01

  Yeah.

• 26:57Nilay Patel?

  And then I have a third set of questions, which is really about what kind of what places can you and can you not go?

• 27:02Speaker 01

  Yeah.

• 27:02Nilay Patel?

  So you, I think something that's very notable is like you don't really make battery cases for phones, which was once a hot category and seems to have kind of died. You know, I spoke to Apple when I was reviewing the new iPhone and I said, you know, we have just antenna performance concerns. Is that like you go to Apple and say, hey, we could just, we make batteries, like we can just make this case? And they say, no, we don't want you to do that. Or is it we make one, you ship it, you check it out? Or is that you saying, actually, nobody wants these anymore. We're just going to make the bricks.

• 27:29Speaker 01

  I think technical challenge is definitely a deal breaker there. So to actually have a good battery case as well as actually, you know, good antenna performance is just tough, right? But last year with, you know, the wireless charging, the problem has doubled.

• 27:44Nilay Patel?

  Really?

• 27:45Speaker 01

  So now you actually, so do you want to actually have that battery case being able to be wireless charged or not?

• 27:51Nilay Patel?

  Mm hmm.

• 27:51Speaker 01

  Because if it's not, then the phone sort of loses its wireless charging capability.

• 27:56Nilay Patel?

  Right.

• 27:57Speaker 01

  Right? But if you want to build in, then that's adding, you know, even more, you know, sort of shielding. Or, you know, basically interference to the phone's antenna performance. So I think it's just becoming like an impossible problem. I'm not saying impossible. I think the challenge is definitely, you know, sort of increased.

• 28:13Nilay Patel?

  Yeah, I mean, the trade off there seems enormous, right?

• 28:16Speaker 01

  And also, I think the phone became a bit secret too, right? So with the addition of the battery case, it's going to be just quite bulky.

• 28:24Nilay Patel?

  So is this a set of trade offs that you see? Okay, we can build a battery case, but we have to add another wireless charging coil to preserve that. And now we know we're degrading antenna performance. We're gonna, we're gonna not do it? Or is it, we're gonna make this and we know some people will choose the trade off, but Apple says, hey, you can't do it.

• 28:39Speaker 01

  No, it's more like we build a prototype, but we decided we don't really like it.

• 28:45Nilay Patel?

  You're like, no, no, no one will actually.

• 28:47Speaker 01

  Yeah, so we, we, that's actually, so we would, you know, build something and we, you know, show it to our customers and they don't really like it. We just don't even ship it.

• 28:56Nilay Patel?

  Yeah.

• 28:56Speaker 01

  Right.

• 28:57Nilay Patel?

  And then the other one I was just wondering about, this is not your, not sort of anchors moment, but case that adds a headphone jack back to these phones.

• 29:05Speaker 01

  Yes.

• 29:05Nilay Patel?

  It seems like a very natural sort of thing to do.

• 29:07Speaker 01

  Yes.

• 29:07Nilay Patel?

  Is there a reason you haven't done one of those?

• 29:09Speaker 01

  Well, again, that's back to USB C, right?

• 29:11Nilay Patel?

  Really?

• 29:11Speaker 01

  So do you still like your 3.5 millimeter jack to be there forever?

• 29:15Nilay Patel?

  Yes.

• 29:18Speaker 01

  So I suppose you probably have some very expensive.

• 29:20Nilay Patel?

  You asked me a question and a bunch of people in their cars listening to this was like, what's, yes, of course. I think it's a very valuable thing, but that's just me. Other people obviously disagree.

• 29:29Speaker 01

  Yeah, for people actually who had invested in some very expensive, you know, headsets with this 3.5 millimeter. They're going to want it to be there, right? But I think for a lot of people, for probably like 99 or even 98% of the customers out there. I think they'll probably just want to use something that works universally. That USB, you know, C headset.

• 29:49Nilay Patel?

  Yeah.

• 29:50Speaker 01

  I mean, it's able to plug into your phone and your laptop and your other places.

• 29:54Nilay Patel?

  So you think USB C headphones are the thing? Do you make USB-C headphones right now?

• 29:58Speaker 01

  Uh, not yet, but it's definitely on our roadmap.

• 30:01Nilay Patel?

  Okay.

• 30:01Speaker 01

  Right, but again, so that headphone can be phone compatible, laptop compatible, and then hopefully in the future, like in cars and in airplanes, right? I mean, I hate nowadays when I'm traveling internationally, like to, you know, try to find a place to plug my, you know, headsets in this.

• 30:16Nilay Patel?

  Do you have a USB-C? I, I just feel like I'm just asking about things I want you to build because you do a good job of them. Um, do you have, do you make a headphone dongle?

• 30:23Speaker 01

  USB-C to...

• 30:24Nilay Patel?

  3.5.

• 30:25Speaker 01

  3.5 headphone dongle. I don't recall we have one, but okay, we're gonna build one for you.

• 30:30Nilay Patel?

  Okay. Well, I mean, that's a, I, I ask in all serio-, I mean, first of all, I want one, so that'd be great. But I ask in all seriousness, until Google shipped the Pixel 3.

• 30:38Speaker 01

  Yes.

• 30:39Nilay Patel?

  There was actually not a great USB-C headphone dongle on the market.

• 30:43Speaker 01

  I see.

• 30:43Nilay Patel?

  It was just like a missing product. And so that's why I, I keep in mind this idea, is you see the ecosystem changing.

• 30:50Speaker 01

  Yep.

• 30:50Nilay Patel?

  You see the standards changing.

• 30:52Speaker 01

  Yep.

• 30:52Nilay Patel?

  And the ecosystem has some like notable gaps in it.

• 30:54Speaker 01

  Yes.

• 30:55Nilay Patel?

  So USB-C headphones is one notable gap.

• 30:57Speaker 01

  Yes.

• 30:58Nilay Patel?

  Uh, USB-C and dongles basically are sort of another notable gap.

• 31:01Speaker 01

  Yes.

• 31:02Nilay Patel?

  And so I'm wondering, how do you think about addressing these gaps of the market? And it sounds like you're saying, look, we're all just moving on.

• 31:09Speaker 01

  Yep.

• 31:10Nilay Patel?

  So like we, these gaps are fine.

• 31:12Speaker 01

  No, no.

• 31:12Nilay Patel?

  They're not worth addressing.

• 31:13Speaker 01

  If we have enough engineers.

• 31:16Speaker 01

  We'll try, you know, attack those problems all.

• 31:18Nilay Patel?

  Yeah, yeah.

• 31:19Speaker 01

  But, you know, you don't, right?

• 31:20Nilay Patel?

  You're right.

• 31:21Speaker 01

  So we have actually today about 700, you know, product managers and engineers today.

• 31:26Nilay Patel?

  Wow.

• 31:26Speaker 01

  In-house, we're still, you know, ramping it up.

• 31:28Nilay Patel?

  Yeah.

• 31:29Speaker 01

  So it went actually from 400 something last year to 700 this year. But again, as you said, there's still problems we haven't really, you know, addressed well.

• 31:37Nilay Patel?

  Right, well, it, it just seems like you have the most considered opinion on how USB-C should develop. And so the question is, do you try to make it solve all the old problems? Or do you push into the future?

• 31:48Speaker 01

  At this point, it's, you can see it's, you know, primarily charging first, right? Because with charging, we haven't really released enough products to fill that spectrum yet. So going to audio, I think that's the next one, and that's someone, we definitely will be there.

• 32:01Nilay Patel?

  Do you think Apple will switch from Lightning to USB-C?

• 32:04Speaker 01

  I...

• 32:04Nilay Patel?

  Because everyone says that's the thing that'll do it, and I don't know if they ever will.

• 32:08Speaker 01

  You should ask them.

• 32:10Nilay Patel?

  You know, don't you?

• 32:11Speaker 01

  No, I honestly don't. I honestly don't. I want to know too. I mean, let me know the answers if you have.

• 32:17Nilay Patel?

  Yeah, there's an event coming up. We'll ask them for sure. It's remarkable that you've started a company. You started selling on Amazon. How do you think you went from where a direct consumer retailer of primarily Amazon to sort of this moment where you're having your first New York event? Like, what was that path like? How did you? How did you build a brand to here? Is it all just word of mouth? You have to do marketing? When did you make the decision of I need to go stand on a stage and actually announce some new products?

• 32:43Speaker 01

  I think there's one perception that we felt that we had to change, which is Anchor is a power bank company.

• 32:48Nilay Patel?

  Yeah.

• 32:49Speaker 01

  Right? Because still, like, you know, journalists will write, okay, so Anchor is this battery company out there. Well, we felt, I mean, this is no longer true for a few years, right? And so that's why we felt that, you know, with one event to showcase, you know, the different categories that Anchor is working on, Anchor Innovation is working on, we could better actually, you know, bring the general public an impression that how this company, what this company is about.

• 33:15Nilay Patel?

  And why do your own event and not go to like CES or something like that?

• 33:18Speaker 01

  We tried to actually CES, you know, this year we had a booth there. We're basically showcasing all the brands, but it's just too crowded, right? It's so hard to get a voice out there.

• 33:27Nilay Patel?

  I agree.

• 33:28Speaker 01

  Yeah, but this year, you know, we tried to really just have our own stage and people here only for Anchor. So hopefully that will, you know, will bring, get the voice out about, you know, how Anchor Innovation has now, you know, five brands working on charging, audio, smart home, smart driving, smart projectors.

• 33:46Nilay Patel?

  Yeah. Smart driving. What's smart driving?

• 33:48Speaker 01

  That's the Rove. Remember the Rove Viva? That's actually the Alexa, yeah, with Alexa.

• 33:54Nilay Patel?

  How's that one going? Do you have one in your car?

• 33:56Speaker 01

  Yeah, well, actually, so.

• 34:01Speaker 01

  Well, don't bring the question up, but you know, yeah, I wish to if I were in the States.

• 34:06Nilay Patel?

  Okay. Oh, right, because Alexa doesn't work everywhere. I got it. Okay. Fair answer. Fair out. And so the reason I ask for that is, do you think the path for Anchor

• 34:16Speaker 01

  Yeah.

• 34:16Nilay Patel?

  is to always sort of be leading in these accessories? Or is it to become a major consumer electronics brand? Would you make a phone? Would you make a television? Would you do all these things that the Sonys and Apples and Googles of the world do?

• 34:31Speaker 01

  That's a great question, actually. I would say it's quite a few times we've thought about the problem. Shall we be making phones or even TVs? But if we do so, we definitely have to convince ourselves that we're bringing unique value to the table. If we're not, then we shouldn't be doing it. So with accessories, we do see a bunch of low-hanging opportunities out there. Where actually companies are not doing good enough. But with phones, with TVs, I think, again, we yet have to figure out what additional value, what uniqueness can we bring? Because we just don't want to do me-too products.

• 35:07Nilay Patel?

  So here's my last question. What don't people know about Anchor that they shouldn't know? Because it's still, we wrote a whole feature. Here's this company that you know about, but you don't know anything. We tried to explore where you came from. But it still seems like you're the default option for power banks, honestly. I mean, people, assuming you saw a lot of them. What don't they know about that business?

• 35:27Speaker 01

  Well, if there's one thing I'd like people, I'm not sure if they know or not, but we actually do pay attention to every review

• 35:35Nilay Patel?

  Yeah.

• 35:36Speaker 01

  that they leave online. It's that we actually have product managers and quality engineers read through every of them.

• 35:43Nilay Patel?

  Wow.

• 35:43Speaker 01

  So is that something you know?

• 35:45Nilay Patel?

  No. I mean, I know, I knew that you guys pay a lot of attention to those Amazon reviews.

• 35:50Speaker 01

  Yeah.

• 35:50Nilay Patel?

  And I know that Amazon's score for every product is life or death for the product.

• 35:54Speaker 01

  Yeah.

• 35:55Nilay Patel?

  So I assumed you paid attention. I didn't know you read every single one.

• 35:58Speaker 01

  Yes.

• 35:59Nilay Patel?

  Because there's tens of thousands on some of these products.

• 36:00Speaker 01

  That's actually 350,000 last year.

• 36:03Nilay Patel?

  Wow.

• 36:03Speaker 01

  More than that.

• 36:04Nilay Patel?

  That's crazy.

• 36:05Speaker 01

  Yeah, so you have to, actually, we not only read the negative ones, but we also read the positive ones.

• 36:11Nilay Patel?

  Yeah.

• 36:11Speaker 01

  Because when people are happy about something, we also actually log it down. So we have a system, basically, to lock down what each individual feature that people like in each review.

• 36:21Nilay Patel?

  Yeah.

• 36:21Speaker 01

  Right, so we can actually not only do qualitative studies, but also do quantitative studies on what people like.

• 36:28Nilay Patel?

  Yeah.

• 36:28Speaker 01

  So, for example, we change a packaging, like, let's say, like, 50% more people talk about it and they like about it, then we know it's right.

• 36:36Nilay Patel?

  That's really cool.

• 36:37Speaker 01

  I mean, we also do focus groups. That's sort of way in the beginning of the product development cycle. But I mean, one thing we do is that before entering a category, we'll just gather around all the reviews for the existing products.

• 36:48Nilay Patel?

  Mm hmm.

• 36:49Speaker 01

  Or try to quantitize them and see, hey, how many people like this, how many like that, and so on and so forth. So that's kind of like a focus group.

• 36:57Nilay Patel?

  Yeah.

• 36:57Speaker 01

  And even more accurate.

• 36:59Nilay Patel?

  That's very cool. Well, it's been really interesting to chat with you today. Thank you for taking so much time.

• 37:03Speaker 01

  Well, it's a pleasure, really. I think you, you know, you know so much about this world. And I think you're, again, genuinely interested in helping, I think, the world to be a better place. So I really hope there are more people like you out there.

• 37:15Nilay Patel?

  Wow, that's a lot to look up to. All right, I'm gonna do my best. But first, I need, I need that power brick with four USBs. And a USB C headphone dongle.

• 37:23Speaker 01

  You'll get one.

• 37:24Nilay Patel?

  I'll help the world out for you. I want the headphone dongle. All right, thank you so much, Stephen. I really, really appreciate it.

• 37:29Speaker 01

  Same here. Thank you.

• 37:31Nilay Patel?

  Thank you so much to Stephen Yang from Anchor. It was really fun to talk to him. And hopefully, we'll have him back on the show again soon. I want to know what you think of these interview episodes. Tweet at me on at Reckless on Twitter. I want to know how you think they're going. And I would love to know who you want me to interview next. We'll see you later this week for the full-on Vergecast. And we'll see you next week again with the interview episode.