Business

How Waze Changed the Way We Drive

Cast your mind back to pre-Waze days, when your glove compartment was stuffed with maps of Vermont and Arizona and to get somewhere you needed to know the way. Now you just punch in the destination address and follow the turn-by-turn instructions like a robot. Any hard-earned knowledge of the back roads has been rendered worthless, because Waze uses real-time traffic data to give you the best route at any given moment. Waze has made us dumb but happy.

Last week Uri Levine, one of the three founders of Waze, came out with a book, “Fall in Love With the Problem, Not the Solution: A Handbook for Entrepreneurs,” which describes how the navigation app came together, along with advice on how to be an entrepreneur. It is probably the best insider account about Waze you’ll ever get, because the other founders, Ehud Shabtai and Amir Shinar, aren’t giving interviews. (I asked.)

I’ll tell you what Levine told me about Waze in a series of Zoom interviews and email exchanges, but I’ll preface it with my biggest takeaway: Being an entrepreneur is nothing like driving a car with Waze on. There are no turn-by-turn instructions. There is no certainty that you’ll get where you want to go. In fact, you probably won’t.

Another takeaway: Having a great idea is a necessary but not a sufficient condition for entrepreneurial success. “The importance of the idea is about 1 percent to 5 percent of the journey,” Levine wrote to me. “The rest is a long roller coaster journey of failures — hard work over a long time.”

I asked Levine to explain why an entrepreneur should fall in love with the problem, not the solution. Isn’t the problem the enemy that you’re trying to vanquish? Why love it? To him, loving the problem means remaining focused on customers’ needs — the problem — rather than getting overly attached to your latest, maybe-not-so-good idea for serving those needs. “Going back to 2007 — if I say I’m building an A.I., crowdsourced navigation system, you don’t really care. If I tell you I’m going to help you avoid traffic jams, you do care,” he said.

Steve Wozniak, a founder of Apple Inc., who wrote the foreword to Levine’s book, put it this way: “Falling in love with the problem means valuing the end user as the key to success, not even your own ideas and creations.” He added, “I have always believed in this.”

Now I’ll tell you the Waze origin story from Levine’s perspective. On the Jewish holiday of Rosh Hashana in 2006, Levine and some friends gathered in Metula, a small village on Israel’s border with Lebanon. Levine was the last to head home, so he called friends who had taken different routes to figure out which would be fastest. Bingo! “That’s what later on became the essence of Waze,” he wrote.

That idea wasn’t enough, though. He needed a map. He approached one mobile navigation company that had a map and was rebuffed. “No one cares about traffic information,” the chief executive said, according to Levine.

In 2007 a colleague introduced Levine to Shabtai and Shinar, who were building a free map of Israel called, prosaically, FreeMap Israel. The map was made through crowdsourcing as volunteers drove around with GPS devices, adding roads as they went. It wasn’t perfect — people had to collect data on personal digital assistants and upload it to their computers when they got home — but the price was right. And smartphones with built-in GPS capability were just starting to catch on. “What we didn’t know back then was that Apple would revolutionize the business when it launched the App Store in 2008,” Levine wrote. “That would in turn give Waze its biggest push.”

In 2009 Waze began serving customers in Israel as an app for navigation based on real-time traffic data. Levine was the chief executive officer in charge of management, recruitment and raising capital. Shabtai was the chief technology officer, and Shinar was the vice president for research and development.

From the start, Waze benefited from network effects. The more people use it, the better it gets, which encourages even more people to join in. Some enthusiasts add or edit roads via computer, similar to the way people edit Wikipedia pages. I found one entry from Australia last month about a road that deteriorates from “reasonably graded gravel to a lengthy section of barely navigable farm track, with deep puddled tyre grooves and grass in the centre almost higher than our bonnet.” It added, “Please consider any possible means to demote this section from the way-finding algorithm.”

A way to help the Waze community that’s less time-consuming than map editing is to report roadside hazards and the like. But even those who do neither still contribute to Waze because the system learns from their anonymized GPS data how fast or slow the traffic is on their routes.

None of that happens without first getting to a critical mass, though. After succeeding in Israel, Waze turned on the app worldwide starting in late 2009. “It was simply not good enough — really, it simply sucked — except in four countries: Ecuador, Slovakia, the Czech Republic and Latvia,” Levine wrote in the book. In Ecuador there was a strong local partner; Levine told me he’s not sure why it caught on in the other three countries. “Everywhere else,” he wrote in the book, “people would download the app, try it and give up.”

There is a long-running debate in tech over the concept of the minimum viable product. Engineers are willing to tinker with a pretty bad product if it’s interesting enough, but the general public is less tolerant. Release something that’s substandard, and you could alienate customers forever, one argument goes.

Levine doesn’t buy that. “The risk of you losing your customers is zero because you don’t have any customers. What are you going to lose?” he asked. He and his partners tried several times to start in the United States. “Each iteration was launched with the conviction that it’s going to work,” he said. The team learned from each failure. “What makes successful start-ups is the perseverance, the grit,” he said.

Waze’s fortunes in the United States got a boost from Carmageddon, when a section of Interstate 405 on the west side of Los Angeles was shut down for a weekend in July 2011 for a widening project. ABC7 Eyewitness News teamed with Waze to promote the app and update viewers on traffic snarls.

In 2013 Google bought Waze (for $1.15 billion in cash, according to the book), providing a nice payoff for the co-founders and the employees, all of whom owned shares. A few volunteers who had helped build FreeMap Israel were disgruntled, though. One, an accountant named Roey Gorodish, filed a class-action lawsuit that got as far as the Supreme Court of Israel. The court turned him down on grounds that class actions aren’t appropriate for intellectual property cases, though it said the lawsuit “raises interesting questions.”

Today Waze has 151 million monthly active users and 100,000 volunteer community members active each month worldwide, according to Caroline Bourdeau, a Waze spokeswoman. (I would have guessed higher, based on the behavior of friends and family.)

I asked Levine if he uses Waze for his daily commute. “I don’t,” he said. “I ride my bicycle most of the time because I hate traffic jams. That was the trigger for pretty much everything. But every time I get into the car, I use Waze. I do whatever Waze tells me.”


Outlook: Yelena Shulyatyeva, Carl Riccadonna and Andrew Schneider

About 70 million recipients of Social Security and Supplemental Security Income are getting 8.7 percent cost-of-living adjustments in their checks from the government this year. The big income bump will help the U.S. economy by offsetting slowing wage growth, but it “will not prevent the economy from falling into recession later this year,” the economists Yelena Shulyatyeva, Carl Riccadonna and Andrew Schneider of BNP Paribas Securities, a French bank, wrote in a client note on Thursday.


Quote of the Day

“When human hearts and minds connect, a lot stands to happen. Never feel that investing time and money in networking is a wasteful act.”

— Monique Nsanzabaganwa, deputy chairperson of the African Union Commission, in an interview with Stellenbosch University of South Africa (2019)


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