Why charging phones is such a complex business, with Anker CEO Steven Yang

Anker is one of those companies that’s endlessly fascinating to me — CEO Steven Yang founded it in 2011, and since then, it’s turned into a 3,000-person company that operates all over the world by selling phone chargers and battery packs on Amazon and have since expanded to other categories like webcams, Bluetooth speakers, and smart home products. 

Along the way, they’ve pioneered a major advancement in charging technology — you know that little white brick that takes forever to charge an iPhone? It’s made using silicon and puts out about 5 watts of power. Anker made a big bet on a material called gallium nitride, or GaN, and it is now a charger the size of that iPhone brick that can put out 30 watts of power — enough to charge a MacBook Air. It was a big bet, and it paid off.

And, of course, we had to talk about Amazon. Anker started its business on Amazon and still sells most of its devices on the platform. Steven told me that Anker has 100 people, or fully 3 percent of the company, dedicated to thinking about managing the Amazon marketplace. And for good reason: this past summer, several of Anker’s competitors were banned from Amazon for breaking guidelines around fake and paid five-star reviews. So, of course, I asked Steven for his views on that.

Our conversation covers the full stack of Decoder topics: taking bets on new tech like gallium nitride, building a direct-to-consumer business on Amazon, and the complexity of managing the Amazon relationship, regulatory issues, platform fees — you name it. And all because of phone chargers. I told you — Anker is endlessly fascinating.

OK, Steven Yang, the founder and CEO of Anker Innovations. Here we go.

This transcript has been lightly edited for clarity.

Steven Yang, you are the CEO of Anker Innovations. Welcome to Decoder.

Thank you, Nilay. It’s a pleasure.

You and I have talked before; I have interviewed you on The Vergecast. A lot of things have happened since then — that was three years ago now, so we have a lot to talk about. But, for the Decoder audience, let’s start at the beginning. Anker is one of the more successful companies that makes accessories for phones and computers. You have expanded into other categories like soundbars, projectors, and home goods. Tell us a little bit about Anker. Where are you located? How many employees do you have? What are your biggest markets?

We like to think of Anker as a global company. A large part is in China, working on product development, but there are also hundreds of us everywhere in the world. We have offices in Seattle, Los Angeles, Tokyo, Australia, the Middle East, Southeast Asia, and Europe, and so on and so forth. 

Product-wise, Anker started from charging. Portable chargers were the beginning category. We expanded into everything charging under the Anker brand. Later, we added audio to our portfolio. Under the Soundcore brand, we have Bluetooth speakers and headsets. From 2017, we added smart home [products]. Now, under the Eufy brand, we have cleaning robots as well as home security products. We also have a smart projector sub-brand called Nebula. So those are our 3+1 brands.

And how big is Anker? How many people work there in total?

A little bit over 3,000 people now.

Wow. That is a big growth from the last time we spoke, right? The company is getting bigger.

Yes. I hope we are still keeping that momentum. But yes — the new categories take a lot of effort to really get into and do well in.

Three thousand people is right on the edge of being a pretty big company. How much of your time is spent on products and product development versus managing all of the other things like remote culture and international trade policy — things like that?

That’s actually a great question. So I spent a lot of time thinking about that. We are in about 15 categories at the moment, and the complexity among the different categories is just increasing fast. And there is also complexity from being multi-countries as well. We’re in 30 to 40 countries, and that complexity is increasing as well. So if you multiply that number of categories and number of countries together, the complexity becomes almost impossible to manage by a single person or even a small team. After realizing that, we had an internal discussion and realized there was no way we could manage every category and the business in every region. We have to turn our roles from managing to empowering.

So, essentially, we built the company as a product [that] could empower the people from over the world to actually do the categories, do the regional sales work, do the brand work that they would like to accomplish. So I would say 80% of my time is spent on working on the company as a product rather than individual products. So, sometimes, I discover new products in our press release, [like you do].

The other big thing that happened to Anker recently: a year ago, you went public on the ChiNext stock exchange in Shenzhen. You are a public company CEO now — that changes the job. What has changed for you now that you are running a public company?

I think I really succeeded in telling myself nothing changed.

All right. That is a step.

For me, there is really no difference because we have a president, Zhao Dongping, who handles all the reporting and so on and so forth. So, for me, life stays the same. I don’t check our stock prices. Never, ever, actually. It’s not in my stocks app. I’m just acting as though we’re just still in the good old days.

Has going public given you any additional capabilities? Obviously, going public helps you raise money, it gives you new audiences, and it provides avenues for growth. What are the other benefits of going public?

Anker is getting more popular in the China market. Getting listed definitely helped us raise awareness. In terms of recruiting, people now understand that this is a listed company instead of an unknown company. Anecdotally, we are probably actually much more well-known outside of China than in China.

That is really interesting. How much of the business is still selling chargers and accessories versus the Eufy home products or the Soundcore products?

The non-charging part is growing faster than charging. Last year, charging was already less than 50 percent. This year, probably around 40 percent is charging. We have slightly less than 30 percent in audio and then a little bit more than 30 percent in smart home products. The breakdown is almost 3, 3, 3 — charging, audio, and smart home.

The European Union recently proposed that all new products use USB-C — including the iPhone. You have been on the front lines of USB-C for years. What do you make of the announcement that the European Union is going to mandate this charging standard?

We welcome that. When you and I met for the first time in 2018, we were in that conference room talking about how USB-C is going to take over the world — how people will use a single charger for all of their devices, saving 300,000 tons of e-waste every year. Gladly, we’re seeing this becoming true year after year. Last year, Apple decided to take the in-box chargers out. This year, the European Union is pushing that envelope even more. In China, there’s regulations being established to enforce that the protocols are interchangeable as well. It is becoming a common practice to just have interchangeable chargers to feed all our consumer electronics products, which is super.

Apple and Samsung do not have chargers in the box anymore. We should talk about the international regulatory pressure to reduce e-waste, but I am curious from the nuts and bolts level: if companies are not including chargers in the box, does that result in more charger sales for Anker?

Yes — a lot more, because this is a new category. Previously, a lot of users didn’t buy a charger by itself. Per our survey, about 50 percent of those users still just go back to using their old chargers, because they have saved some over the years. But more and more people are starting to shop for individual chargers. Of course, a large fraction of them will go to the device brand — for example, they will go buy an Apple or Samsung charger. Still, that gives us a chance as a third-party charger brand to reach those users. It is a chance to inform them about the superiority of our charger: the small size, the high power durability, and the interoperability to charge all their devices from all the brands.

This brings us back to the e-waste question: the idea was that, since consumers probably have a charger already from a previous phone, manufacturers can take the charger out of the box, reducing e-waste. But you are saying consumers are responding to these mandates by buying a lot more chargers. Do you think that the box mandates have resulted in a meaningful effect on e-waste?

First of all, when chargers aren’t in the box, that’s already a lot of savings. Let’s say that for a hundred people, we saved a hundred chargers already. Per our survey, around 50 percent of people will reuse their old chargers so they won’t buy any more, but there is still a fraction of users whose old chargers are slow-charging chargers.

The classic Apple charger is a slow-charging charger.

We learned about fast charging through PD [power delivery], which could charge your phone 50 percent in less than 30 minutes. That’s really helpful in our daily lives. When the charger is not in the box, you need to get it from somewhere. So people go online and either shop for the Apple charger or come to Anker and get an Anker charger. Anker products are just a fraction of the size of an Apple charger, so some people come to us for that sort of efficiency.

Do you think in the next phone generation, people will reuse their Anker chargers because they have a high-quality Anker charger at home already?

Over time that percentage of people needing new chargers will decrease because they already own quite a few, but they will hopefully get equipped with Anker chargers for different life occasions or scenarios. They could happily skip the buying a charger part and just enjoy their devices.

Do you see a shift from the old USB-A rectangle connector to USB-C? Are people buying new USB-C chargers?

Yes. Our USB-A cable volume was flat or even dropped a little bit. Our USB-C cable volume is increasing very fast.

The last time we spoke in 2018, you were very excited about gallium nitride — GaN. Gallium nitride replaces silicon, allowing you to provide more power and smaller form factors in phone chargers. That is why Anker’s chargers can be smaller than your competitors’ chargers. At that time, gallium nitride seemed like a key enabling technology for that entire market. Now, several years later, has GaN played out the way you think it should have?

Yes. We sold a lot of GaN chargers already in the past few years, and we launched the second generation — we call them GaN2 — earlier this year. GaN2 chargers can now do 65 watts in a very small cubic space as well. We’re actually about to launch GaN3 next year, which will bring the charger size even smaller and increase the power rating as well. As you probably can see, devices are becoming more power-hungry and charging at a higher speed. Ten years ago, chargers were 5-watt. Then it was 10, and Apple has put it up to 20. The other Android brands brought it up to 40-60 watts. I think talking about wattage is not a customer-friendly approach. Instead, we talk about charging time. 

The charge time used to be around three hours, but it’s been brought down to roughly one hour and 20 minutes with the 20-watt chargers, and then reduced to about 30-40 minutes with the 40-60 watt chargers. Even more adventurous brands are doing 120-watt, which would get the phone fully charged in less than 20 minutes. The phone manufacturers are really just escalating on that charging power rating and reducing the charging time. 

That same competition has been moving to laptops too. Superbooks [ultrabooks] used to be 30-watt, but now it’s ramping up to 45, 60 watts and up. Gaming books, again — the power ratings are all going up.

This year, we announced that the dual-port product would increase to 65 watt or up to 90 watt. We feel that is enough for now, but looking forward to the future, we feel the multi-port product will probably have to be 150-watt or 200-watt or even 250-watt — because the multi-port product will have to support, for example, a 60-watt phone or a 120-watt laptop and a few other things that will quickly add up to 200 watts. At this power rating, it really needs gallium nitride to reduce the size of that charger. 

Those huge brick adapters that come with gaming laptops were 200 watts, right? Users don’t want to carry that 200-watt brick everywhere. With gallium nitride, we can make a 200-watt charger in a very small fraction of that size.

Gallium nitride is a key enabling technology that hit the market around three years ago, but you are already talking about the third generation. Is gallium nitride a technology that you have to invest engineering resources in? Is there a supplier pipeline or a material science pipeline? How do you manage that investment?

Anker was actually the first to introduce gallium nitride to consumer electronics charging. The way we were able to do that was by partnering with the frontier chipset manufacturers who developed the gallium nitride charging chip. We were almost their alpha customer. So when the chip was first developed, it’s a lot of hoops to jump through to make it into a product. That requires not only material science knowledge, but also application knowledge, system architecture knowledge, and knowledge about managing heat. It’s almost a system effort. We accumulate knowledge in that, and couple that together with the gallium nitride chips and the manufacturer to build them into products. 

You’ll be seeing the GaN2 this year at the 65-watt size and the 30-watt size. We’ve been working with Power Innovations for almost a year on that. GaN2 is the brand new generation of chips that we launched in the middle of this year. GaN2’s 65-watt size was a fraction of the competition’s. 

The reason we were able to do that is based on Power Innovations’ newest generation of their GaN2. We’ve been the sole partner for almost a year developing that — you won’t be seeing similar products coming from other brands for at least three to six months because PI and Anker are working together, solely.

So Anker and PI have had an exclusive relationship to develop the next generation GaN chipset, and then that window opens three to six months later so other people can buy that chipset.

Yeah.

Since we are talking about chipsets, all of your businesses have chips in them. How has the chip shortage impacted Anker?

A lot. It’s a different fire every day. We’ve gone through it the whole year. You adjust: “A new fire? Let’s go put it out.”

Where has the biggest impact been?

We have different product lines, so generally the biggest challenges that come from chipsets are from the eight-inch wafers. Eight-inch wafers are sort of outdated technology, but they are still used by a lot of chips. Twelve-inch suppliers are not that scarce, but the challenge is when you shift a chipset from being manufactured by eight-inch to 12-inch, you have to go through a lot of qualification processes, almost reverifying that product again.

Different industries take different cycles to verify their products. The auto industry obviously takes the longest time. They probably need to take one, two, or even three to five years to verify a chipset. Because of that huge shifting cost, the eight-inch wafer capacity was largely reserved for the auto industry and not the consumer electronics category. Again, we need to verify that transition, but it’s just a relatively shorter time — a month or two months rather than two years, so we are asked to do the shift more. 

It’s a lot of verification work going on throughout the whole year, but I think that’s just social responsibility.

The chip shortage comes up on nearly every episode of the show, so I’m always curious.

Cool.

Some technologies seem like they will enable new capabilities, but there are also some technologies that seem like they are just going to hold us back forever. Apple famously has the MFI program made for the iPhone. Even in Anker’s product line, I see there are wireless chargers that have Apple’s chip in them that enable faster charging — but there are products that look exactly the same without that MFI certification that charge slower. That has to be so frustrating. How is Anker dealing with MFI? Is that just the state of things, or is there a push and pull with Apple?

We certainly see where that is coming from and why Apple needs that. If you look at the market, there are just a whole lot of non-MFI cables out there that are just really harmful to your device. The non-MFI cables that you can get — five Lightning cables for $5 or even less — those cables actually do fry your phones, so I can see, with that sort of authentication chip in the MFI module, that at least the customers could be informed if what they’re buying is an authentic Apple cable or not.

But I think there could potentially be other ways to solve the same problem by, for example, enforcing a universal standard of how you should make a cable. I think when the universal standard is there, then you no longer need that much of a proprietary standard, but there’s always a push and pull. The industry also needs to put in a lot of effort involved in building a universal standard and enforcing it too. So far I think we’re looking forward to that, but we’re really not seeing that much work happening.

I tell this joke on my other show, The Vergecast, all the time — I am an absolute sucker for car chargers. Every time I see one, I buy it. It’s a problem. I am the entire Instagram advertising economy. Apple has a new standard called MagSafe: a magnetic charging system for their phones. There is not, as far as I can tell, a great MFI MagSafe car charger, an Apple-approved, fast-charging car charger that mounts to your car and you can clip your phone in. Why is that?

Apple has high standards. Coupling the heated environment in the car with the wireless devices being heated while working could be a challenge, but we’ll solve it soon, hopefully, sometime.

Is that a promise? Are you going to solve it soon?

Or somebody— no, no, or somebody else.

Are you working on one?

I don’t know. I was telling you, I’m discovering our products through press releases too.

Oh man, you came in — that is a ready-made dodge from the question. You set yourself up. 

Editor’s note: After we recorded this episode, Anker announced several chargers that use the magnets in the iPhone, including a car charger. We asked Anker for comment and we got one from Steven. He said the following: 

“While I can’t comment on Apple’s MFI certification program, I will say that [with] the new MagGo lineup, Anker is making a major move into magnetic charging products and accessories. With each of our six new products there is a stronger focus on color, material choices and industrial design. This is the future of Anker, giving consumers products that combine the world’s most advanced charging technology with designs that compliment the consumer’s unique style.”

I want to switch gears to enabling technologies like USB 4 and Thunderbolt 4. Do the new connections and standards in the market impact your business? You’re not necessarily in control of those standards, but when you see them coming, how do you plan for them?

Interestingly, we are the first partner to work with Intel to bring a Thunderbolt 4 docking station to the market. I think brands see Anker as a trustworthy and also efficient developer on new technologies. That’s why chipset manufacturers and technology enablers come to us. We’re happy to be the bridge between that new technology and the customer base.

Do you think that Thunderbolt 4 products are going to get cheaper? That technology has been pretty high-end so far — will Thunderbolt 4 become more mainstream?

Sure. If you look at gallium nitride, our first 30-watt charger was around $30 and it’s getting cheaper over the years, quickly. Thunderbolt will hopefully be the same thing too. That’s always the law of magnitude, right?

You were talking about five charging cables for $5 and different ways to solve that problem of cheap cables that might fry your phone. It seems like one of the biggest actors in the ecosystem is Amazon, because Amazon will list those cheap products right next to Anker’s products — right next to the licensed products. A lot of your presence in the United States is still Amazon. What is that relationship like? Has it changed over the years? Is that still the primary retail channel for you? Are you trying to diversify?

Amazon’s still more than half of our business. To become a brand, we’d hope to be omni-channel as well. Today you’ll be able to find Anker at the major retail channels like Costco, Walmart, Target, Best Buy, Verizon, and so on and so forth. I think we’re just reaching that goal of becoming the go-to charging brand — which is omni-channel. When talking about counterfeit or fake products, I think Amazon has taken a lot of effort just to work on that. It’s just too much of that. Under the procedure, you have to test buy, you have to send it to a lab, and then you have to get the certification. That takes time and it’s like a neverending cat-and-mouse game.

We just saw a wave of your competitors — RAVPower and Choetech and other brands that were kind of competing directly with you — all get kicked off of Amazon for gaming the review system, asking for reviews from people who hadn’t bought products on Amazon. Is that a game that you have tried to play? Is it something you have totally avoided? Is that just a risk of participating in that ecosystem?

If you tear other brands’ chargers apart and send them through testing facilities, you really see that these chargers are not the same, especially in terms of durability and safety. Ten years ago, when we started selling on Amazon, the first thing we read was the Amazon community policy. It’s roughly a three or four-page document that describes a lot of things that you can’t do — but for some, that document could be a list of ways to make quick money. Anker really came to build a long-lasting business, so we just made sure that we do not do anything that is forbidden in the community policies. I can’t talk about others, but that’s what I asked my team to do.

When we talked to other sellers who participate in Amazon, the pressure to get good reviews and stay high in the rankings is real. How does that pressure impact you and how you think about your business?

It totally depends on how you direct that pressure. If you direct it towards your sales department and say, “Hey, you guys have to get good reviews for products,” you will get bad results. But if we direct that pressure towards the product managers and quality engineers ... if the product team gets to really analyze our reviews, they try very hard to fix those problems. Just by fixing issues and building better products, we will get better reviews. That’s how we have been taking that review pressure for the past 10 years. It’s becoming a core part of this company. 

Anker is driven by good reviews, but recently we also realized that that approach had cons as well. When you look at brand new categories, it is very hard to get 4.5-star reviews. If you focus on reviews too much in the beginning, you prevent yourself from making big innovations. Now we are trying to balance a little bit; for this product that’s already there, our team has to deliver a product that has great reviews, but for some brand new categories that nobody else has worked on, it’s okay to focus on improving reviews through different generations of products.

What is a product category you’ve entered in which Anker has been willing to take that risk and focus on improvement?

The newer categories — for example, conference speakers. The first model we put to the market scored 3.8 at the beginning. But then the team quickly worked on the feedback because, while we tested in different scenarios, there are always consumer scenarios we didn’t have a chance to test. The good thing is that we can roll out software updates. You just fine tune the algorithms to fix the problems, then the rating gets to the 4.5-ish very soon.

I have to ask because I am a product reviewer: Do you pay attention to the professional reviewers as much as the Amazon reviews? Do you pay less attention or more attention? How does that happen?

We actually pay more attention because reviewers see many more products. Not only do we read through the articles you guys write, but also the regular communication channels where hopefully we get more feedback that did not fit into an article. We see you guys as very important.

Some people tell me that we don’t matter anymore when Amazon provides that kind of real-time feedback. I’ve always been curious.

I think it’s two ends: one is about the quality of the review. The other is about the quantity of the reviews. If we get 10 or 20 or 40 people talking about this same point, that also weighs something as well.

We see a lot of gamification in Amazon reviews — competitors are leaving negative reviews, and companies are trying to encourage their customers to leave positive reviews. Has that impacted you on the platform? Do you see that as a risk? Is that something you guard against, is there a process there?

We really abide by the community policies. That means we don’t improve our reviews by incentivizing them, or we don’t try to use reviews to sabotage others, but others are doing it.

Do you see that happening to you?

Yes, we do see that. For example, all of a sudden the top reviews on a listing all become negative because a lot of fake people clicked on this negative review to say “helpful.” But I think Amazon is doing an increasingly better job at identifying this. I’m an algorithm guy; I worked on algorithms early on in my career. I strongly believe that it is easy to fight this. There are so many signals you can collect to really tell that these behaviors are abnormal. For example, 100 or 200 people marking these negative reviews as helpful in a single week — definitely abnormal behavior. You just have to find ways to shoot at it now. 

But the better thing could be finding the source: the bad-faith reviewers are likely not only doing this to your product, but also to someone else’s product. Any mechanic has an ROI, a return on investment, so if you make the return low enough and the cost high enough for creating these fake accounts, that game quickly loses interest. Support would just move away. That’s what we’re seeing Amazon doing as well.

You are the CEO of a 3,000-person company. You obviously spend a lot of time thinking about Amazon. How many people at Anker spend time thinking about Amazon and its policies?

We have a team called online sales organization, which is our only team working on Amazon. It’s about 3 percent of this company, about 100 people out of 3,000 people, are just thinking mainly about Amazon.

The reason I ask is that it tracks with other people I talked to who run businesses on platforms. YouTube creators, for example, spend an inordinate amount of time thinking about YouTube and its policies. Instagram influencers spend a lot of time thinking about Instagram. You run a hardware company running partnerships to launch Intel chipsets exclusively, and yet you have the exact same kind of platform dynamic with Amazon as Doug DeMuro, a car reviewer, has with YouTube. Is that a dynamic you want to change? Do you have leverage to change it, or is that just the way it is? Do you talk to Amazon about it?

I’m not sure that I entirely agree that the dynamics are the same as YouTube or Instagram. It takes a whole lot more effort to just build a hardware product — six months, 12 months, or even 18 months — versus just doing content, but I think the similar thing that we all share would be that the product is still king. I always tell the company that the product is the one and everything else is the zero. If you get everything else right and you have a crappy product, that’s nothing. That’s what I strongly believe. When you get good products that truly benefit your customers, I think that the relationship we have with the platform becomes benevolent and mutually beneficial.

Is that how you see your relationship with Amazon now — as benevolent?

Yes. For the past 10 years we’ve seen this relationship as benevolent, as mutually beneficial, because that gives us the opportunity to just sell directly to the customers. Also, on the other end, because of that quick feedback loop, we are able to create better products to benefit customers as well.

One of the things that sometimes makes that Amazon relationship less benevolent is that the company is somewhat notorious, at least in the United States, for taking data about what shoppers are buying and then making their own products. Is that something you have experienced? Amazon releasing an Amazon Basics version of one of your chargers or your soundbars or something like that?

Yeah, that’s the story with all the channels. If you look at Walmart or Costco, all channels have their brand that has been around for decades. It’s not a new story. What we observed was that the percentage of the channel brands has a ceiling. That ceiling was different for each category. For tech categories, because tech is always innovating, it’s a whole lot more difficult to make channel brands.

I do not think Amazon has a bunch of engineers thinking about gallium nitride. Do they come to Anker and say that they want to make an Amazon-branded USB accessory and you do it for them? Is Anker doing that kind of work, or is that a different set of companies?

We’re still debating about that, really. The teams are different from working on a regular product versus a Anker standard product. I would say not up to this moment yet.

I want to talk about the other categories here before we end. Chargers are important. We obviously think about chargers and USB a lot. They do not require a lot from the user: you plug them in and you plug in your phone, and you are done. Anker’s other categories have user experience concerns — soundbars have buttons and interfaces; projectors. How many user interface designers and software engineers do you have now?

I haven’t really counted, but I think we have roughly a dozen or so user interface developers and around 100 app developers. We definitely realize that software is now the major part of experiences.

For example, a headset: we developed this technology called HearID. In five minutes, it takes you through a set of tests which should play different sound frequencies and try to test your feedback. With that result, HearID can augment a part of the audio spectrum to let you get better music. You can think of it as a very miniature version of a piece of audio amplifier. That part entirely relies on a phone app, but it greatly enhances your listening experience. Our users loved this feature. 

We’re trying to develop more and more of this, so Anker isn’t just a hardware company, but more of a hardware-software company.

Once you start making software, the lifecycle cost of the product goes up. If Anker sells me a charger once, the company does not need to have a software engineer making updates in the app store for the rest of time. If Anker sells me a set of earbuds that have a cool software feature, then that app has to get updated for iOS 15, for iOS 16. How long do you think software features should be supported for? How do you manage that investment?

The original point we consider is still customer value. If that software part really adds enough value for the customer, then there has to be a way to get the numbers right. For example, over the years the Soundcore brand headphones’ price points rose — not only from the software part, but also from more advanced hardware and design. But we started the price point at around $99, and now our most expensive headset has been $149. 

Again, if more innovative products come out that carry better hardware features and more software features, that price point could go up a bit. But eventually the customers have to be willing to pay: if we raise the price, but people just walk away, then something is not right.

This is an intentionally impossible to answer question, but I am going to ask it anyway: in that dynamic, what is more important? Is it the software experience, or is it the hardware experience?

I always see myself as a grayscale guy. I am not a zero guy or a one guy. I did my education in software and had my early career in software, but now I’ve been working on hardware for 10 years. 

I think I see beauty in both disciplines, and sometimes the engineers from the two disciplines hate each other or look down upon each other. But I am really trying to unite them. One is not more important. Together, we deliver this great experience that is so smooth that customers don’t really just think about whether this is a software experience or hardware experience — they just benefit from it. That’s a point that I’m trying to reach.

When we think about great software design, we think about the great companies: Apple and Google. To some extent, we think about Facebook — although there are lots of arguments to be made about Facebook. Do you think that you have attracted the caliber of talent to compete with the giants in terms of software design, execution, all those things?

We don’t do mass-scale software. We don’t do an app that serves a billion people each day, so that’s a much easier problem. But on the other end, that dictates that we don’t attract as good people as those giants. You have to have people who are sufficient for the job. Then, as the complexity of tech rises, the team is able to grow together with the challenges. That’s a very happy state: you don’t get stretched too much, and you enjoy your growth.

One of the things we see is relentless integration of hardware and software that connect to phones. Headphones are a great example: Apple has integrated custom software into the OS to enable AirPods to do things that, as far as I know, no one else is allowed to do on iOS. Google made its own headphones. Samsung is doing the same trick. That’s going to extend to all kinds of categories. Is that a risk that you are hedging against in any way?

Is the European Union actually enforcing the interchangeable standard?

The European Union can say it is doing anything. Whether the EU actually does anything is one question; whether those decisions mean anything is another. That is a risk that the platform will  relentlessly integrate — you don’t even have to ascribe a motive. That’s just what platforms and computers do over time: they just integrate every function. How do you think about that risk?

You have to first accept that risk. When phone manufacturers started to innovate, I think it was natural that they started from their own devices and their own operating systems. But if it’s really something useful, I still see the human climate as a good one where we just sit down together and really talk about how we make this become a standard. We’re seeing proprietary innovations later become standard, so there’s a time gap.

Is Anker in the standards bodies now? Or are you in the USB forum, the Bluetooth standards organization — all those groups?

I think Anker is a member. We’re not in the decision body yet, but we’re definitely hoping to get into it because we carry a lot of consumer feedback — we’re able to quickly take ideas to the market. We definitely hope to be able to contribute there.

One of the products I recently bought was one of your Nebula capsule projectors. It is really fun — a couple hundred bucks and as big as a little speaker. The projector has Anker’s first full-on Android product with a custom operating system, and the app is in the Play Store. Though that seems new, you have a lot of products in that line now. Was that easy to do? Was Google ready to let Anker launch a new kind of product, or was it something you had to convince Google to do?

I think it did take us a while to convince Google to have Android TV deployed on the Nebula with a custom interface. But it was worth our while because it’s a small, soda can-sized projector that you can just take with you anywhere. The good thing is that you can just play it with your phone, but have Android on the projector doing all the content streaming for you. We just need to add that capability to our box — being able to just build products however they should be built.

That’s your first standalone product that runs an operating system that’s owned by somebody else that Anker has to maintain. On the customer interaction spectrum, chargers are all the way on one end: sell them once and walk away. Bluetooth soundbars with an app that might change some settings would fall in the middle. An Android computer is all the way at the other end of that spectrum in terms of how much of a relationship you have to have with your customer.

Yep.

When Anker is doing that process document and the committees are checking in, at some point are you concerned about having to invest in Android updates for this $400 projector forever? Do you think about how Anker will monetize it over that course of time? What does that kind of decision look like?

Google does a great job in terms of updating Android TV once in a while.

A great job once in a while is very accurate.

Google takes all the hard work, and we just package it to make sure it does not crash our interfaces, and then we streamline it for the customers. It’s about a team of 30-40 engineers. We’re really seeing it as an investment into the future, so we can make products that are more complicated. That standalone operating system level capability is something you must have — Anker always stands behind our products, so we have to make sure the ones that are released are really quality products. That’s an investment. 

If the Anker team wants to make a product that is going to require five years of ongoing software engineering investment, is that the kind of decision that comes all the way up to you? Or do you let them make it and see what happens?

That’s a decision that will come to the top of this company. We have an investment board that’s overseeing all the major investments: ideas that cost above $2 million and ideas that will cost us a few years. So, yes, but on the other hand, we see those investments not just as a one-time thing, or for one product, because those new capabilities can be applied towards a different product. For example, the Android system capability is something that we see as necessary for the longer-term future. 

Will Anker make a phone?

No, no, no. We would definitely stay off that playground. I have an analogy on that: if you look at all the consumer electronics subcategories, if you count from the biggest one down, the largest category is the cell phone; 1.5 billion of them each year at about $300 average selling price, so that’s a $500 billion business each year. Next is the laptop and PC category, which is a $200 billion business. The third is tablets — that’s a $60 to $70 billion business. Next is smart watches, and then wireless headsets. These are around $40 billion, but still increasing. 

Have you observed that from No. 1 to No. 5, the categories dropped from $500 billion to $50 billion? It’s a 10-times scale just from No. 1 to No. 5. There are a handful of those big categories. 

On the other end, if you look at the smaller categories, let’s say a $5 billion category: portable chargers, chargers, wireless chargers, cables, hubs, docking stations. I’m already counting six or seven, and that’s just a very small fraction, if you’re counting conference speakers and everything. We literally counted hundreds of small categories that are each around $3 to $5 billion in size.

Anker is really trying to focus on the small categories rather than the biggest categories, because we ended up realizing that, in order to do well in these two extremes, you need different company formations and underlying mechanisms. With our team structure, we can do the small categories well. Let’s not go die in the big categories.

When I interrupted you, you were going to say what you could do next with Android capabilities. What is the next thing you can do with Android?

For example, our personal conference station: right now, we’re talking about an all-in-one station that has the camera, the microphone, the speaker, the charging, and maybe even a screen. For this, you have to have a system that backs it up. Android will be the natural choice.

What is next for Anker? What is the next thing we should be expecting from this company?

We added two or three new categories this year. One thing that we had was Anker Work, which is a bunch of performance and utility enhancement tools and products. We also started working on Anker Make: products related to 3D printing and small-scale manufacturing tools. These are the two things we’ve been working on. You’ve already seen some of the Anker Work products, but the Anker Make will probably come out sometime next year.

That is terrific. Well, Steven, you have given me much more time than you promised. I really appreciate it. Always great to talk to you. 

We seem to have endless topics.

I can do another hour on USB-C. Let’s do it. You got time?

I’ve got to run.

All right, see you, man. Thank you so much.

Thank you. It’s such a pleasure. Thank you, Nilay.