Wednesday, June 10, 2020

Roam Research: Where is the moat?




Update 9/11/20: A $200 Million Seed Valuation for Roam Shows Investor Frenzy for Note-Taking Apps

Some thoughts on Roam Research.

I wrote this post after writing an investment memo on Roam in collaboration with a small community I lead. Find me on Twitter if writing investment memos for fun excites you! 🙃
Roam Research is blowing up right now 🚀

Roam is a web app that bills itself on it’s website as "a note-taking tool for networked thought," while simultaneously scoffing at the idea.

Note-taking tool or not, the groundswell around Roam is eye-popping. Roam has a thriving online community (#roamcult🤘), it’s CEO Conor White-Sullivan has been on top podcasts (20 Minute VC and Venture Stories), at least one VC is constantly pumping them up, and they have been blessed by Venkatesh Rao.

The excitement around Roam and their impressive traction have 2 questions burning on my mind:
  1. How does Roam maintain it's short-term competitive advantage?
  2. How does Roam build a long-term competitive advantage?
Before attempting to answer those two questions, let's first have a look at the current slate of competitors.


Roam Competitors


Looking at Roam's competitors shines light on just how competitive the landscape is right now. I do not yet understand how Roam avoids getting red-queened into limited growth.

For one thing, there are already a number of popular note taking apps with graph-like ability:
There are also multiple direct competitors: 
  1. Ideaflow
  2. Obsidian
  3. Athens
  4. and more
So how is Roam going to survive the current (and forthcoming) competition? 

Roam's vision and whole product


The answer lies somewhere in Roam's vision. From the Roam Whitepaper:
The Roam vision for human knowledge is a collective, open-source intelligence, constantly rearranging, iterating and evolving in the pursuit of truth.  Each of us would become a node within this collective intelligence, forging links and creating networks, sharing the very best each has to offer, improving ourselves even as we improve others, and advancing the interests of humanity as a whole.
There is no question that Roam is thinking bigger than "note-taking app." Playing off of Geoffrey Moore's idea of a "whole product," Roam today is already more than a web app.

Roam's whole product includes:

  • A note-taking tool that makes it easier to connect disparate research and learning
  • An organic Twitter community
  • Slack community
  • A growing ecosystem of Youtube tutorials and blog posts
  • An underlying ethos that has captured tens of thousands of early adopters that are willing to pay.
So again, the burning questions:
  1. How does Roam maintain it's short-term competitive advantage?
  2. How does Roam build a long-term competitive advantage?

Jeff Morris Jr., Erik Torenberg, and the Roam team certainly have a bead on these questions.

Without first-hand knowledge of the answers, here is my view on how Roam could make it big.

🧲 Step 1: Own single-player note-taking 📝

This is all about the community they've built. Roam can use their cult-magnet to pull in:
  • People looking for first note-taking tool
  • Users from closely-related tools
  • Use bottoms-up growth into business/org accounts 
This is all about execution and requires improving both their single and multiplayer experience.

[note: this is a differentiation path, as articulated by Alex Danco]

🌏 Step 2: Link the Roams, become an education platform for the masses 🌍

Connect some number of Roam instances together to create a linked, massive knowledge-graph for public learning.

This probably has to happen in an organic-ish way with Roam influencers doing it on their own accord first, then later opting in to some global-level knowledge-graph. 

At any level beyond an individual influencer, major curation problems would ostensibly crop up. I'm not sure how they get around that.

[note: this is a utility path, as articulated by Alex Danco]

Final Thoughts


I am attempting to look at Roam through a VC-ish lens and want to make myself provably wrong. So here are some thoughts and hypotheses:

Roam the note-taking app
  • I don't believe Roam is today, or can create, a 10x better note-taking experience to gain dominant market share
  • The slew of current competitors and forthcoming competitors will create a red-queen race to the bottom. You will see more, and cheaper, alternatives to Roam that work about-as-well (if not the same)
  • Roam will continue to find purchase with an enthusiastic group of like-minded folks who love Roam’s view on knowledge management 
  • Roam will have find (an exit between $50-$100MM) success for this reason 

Roam the open-source intelligence platform
  • I believe that Roam's vision has already been achieved, just not by Roam. 
  • The internet and existing tools/resources/networks already enable human knowledge to be open-source, with "each of us node within this collective intelligence, forging links and creating networks." 
  • The fundamental problem isn’t availability of information to self-educate, it’s the time/motivation/privilege to self-educate. Roam doesn’t solve that. 
  • Based on those assumptions, I do not believe Roam will achieve massive scale and an associated $100MM+ exit
With that being said, truly, go Roam 💪 #RoamCult is going nowhere and it'll be exciting to watch it grow and evolve over the coming years.

Next Steps





August 2020 Learning List

Photo by  Bekky Bekks  on  Unsplash Information from the past month I'd actually consume again