The AlwaysOn X Fund finished the week up 2.1%, while the NASDAQ was up 2.6% and the S&P 500 advanced 2.4%. Year to date, the AO X Fund is up 70.1%, the NASDAQ is up 35.9%, and the S&P 500 up 27.5%.

Amazon said it will expand its Amazon Web Services (AWS) suite of products to China next year, pushing for a head-to-head competition against rival Alibaba. To do so, Amazon is partnering with local businesses and is also starting an incubator to gain better access to local services for AWS. For the week, AMZN advanced 4.7%.

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It seems trite and obvious to write that the best products are designed around what customers need and want, yet it is still surprisingly common for companies to make decisions based on what’s important for themselves.

Digital magazines are a great example. Physical magazines have been suffering from declining circulations for a while now and their owners have mostly struggled to charge for their content online. When the iPad arrived they and Apple saw an opportunity to reverse the trend by selling magazine subscriptions through the Newsstand app.

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Larry Chiang’s recent blog…

I’m the one that coined the popularity of “Are they bang-worthy after Googling.”

Remmy Oxley: SERIOUSLY??

It was in a movie script called PROSPERASS. Anyway… Email!!

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On Saturday, I read the final draft of a magnificent book by David Rose. The book is titled Enchanted Objects: Design, Human Desire and the Internet of Things.

I’ve known David for many years. I was a huge fan and an early customer, but not an investor, in one of his companies (Ambient Devices) and we share a lot of friends and colleagues from MIT and the Media Lab. I was happy to be asked to blurb his book and then absolutely delighted with the book. It captured so many things that I’ve been thinking about and working on in a brilliantly done 300 page manuscript.

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I am a capitalist. Contrary to the occasional community members who call me a socialist or a techno communist, I believe wholeheartedly in the power of markets to efficently determine what’s best in most cases.

But I am not an absolute capitalist. I believe that markets do break down from time to time and we need to recognize when those things happen and do something about it. The labor movement, when it was not corrupt for the most part, is an example of a societal response to a market breakdown.

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Last week, I used Aileen Lee’s excellent TechCrunch article on Unicorns as a jumping off point to analyze the role of the MBA in creating these unusually valuable companies. This week, I want to take a local lens and analyze these special companies that have been created in Boston. As was the case last week, I was ably assisted by HBS 2nd year MBA student Juan Leung Li.

In order to have a reasonable population of companies to assess, we tweaked Aileen’s definition. We looked at the companies in New England (call them “Boston and surrounding”) that had exited in the last 10 years (2003-2013) with greater than $500 million in market valuation.

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The Amazon AWS public cloud offering has set the stage for a massive transformation of enterprise IT from being premise-driven (servers, switches, data centers, etc.) to being services driven (APIs, services, consoles, etc.). This transformation promises to produce a new crop of winners and losers.

2014 should be a pivotal year in the emergence of hybrid cloud, as Microsoft and VMware enter the cloud space with their own offerings, and compete directly with Amazon for the $1 trillion+ enterprise IT market once protected by moats of complexity, specializations and proprietary hardware.

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The AlwaysOn X Fund finished the week up 1.0%, while the NASDAQ was down -1.5% and the S&P 500 declined -1.6%. Year to date, the AO X Fund is up 66.6%, the NASDAQ is up 32.5%, and the S&P 500 is up 24.5%.

Facebook’s Instagram announced that daily users now make up half its total unique users. By comparison, Facebook’s total DAUs/MAUs were at 61% as of Q3, while Twitter’s were at 43%. Additionally, Instagram unveiled a new messaging tool that lets users share pictures and videos directly with each other, putting Instagram in direct competition with Snapchat. For the week, FB shares soared 11.2%.

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Recently I wrote the first post in a series on board meetings, entitled, “Why You’re Not Getting the Most out of Your Board,” which focused on the need to prepare properly, set good objectives and discuss mostly strategic topics.

Even if you follow this game plan meticulously your board meeting can be taken off course by well-intentioned board members who lead you down a rate hole.

Here’s how it happens …

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I’ve been railing about the evils of software patents – how they stifle and create a massive tax on innovation – since I wrote my first post about it in 2006 titled Abolish Software Patents. Seven years ago this was a borderline heretical point of view since it was widely asserted that VCs believed you should patent everything to protect your intellectual property. Of course, this was nonsense and the historical myths surrounding intellectual property, especially the importance and validity of software and business methods, have now been exploded.

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