Don’t visit this site!

If you like coming up with good ways to spend a lot of time on doing basically nothing, yet feeling you’re getting something done, check out:

where you can use mathematical formulas to come up with your own ring tones. Very cool.

Here’s what I came up with after “investing” 15 minutes:

Have you Googled your Market Lately?

I just read Paul Kedrosky’s post “Marketing 101 in the Google Age” and he brings up some simple, so-obvious-I-don’t-do-it things that every marketer should do:

    The top five site referral words/phrases from Google searches (and how that compares to the previous period).
    Where your company appears in Google results for keywords of your choice and how that is trending. Raw numbers of Google hits don’t matter — no-one goes past the top half of the first Google results page.
    A list of the companies that have bought the main AdWords describing your business. For example, if you’re in sales force automation, list everyone who has Google text ads on the search page, and how that list has changed since the last time you did the search.

Now, ask yourself, when was the last time you did this for your company?

Net TV startup a threat to BBiTV?

My good friends at BBiTV have a cool idea which, among other features, allows end-users to publish video content which is then viewed by other digital cable subscribers.

I just read about Brightcove, a $16M startup which is taking a slightly different spin in that it lets anyone syndicate their content and sell it. Brightcove inserts ads and earns a % of the total revenue. Check out the articles, “Site will cater to offbeat films” and “Net TV start-up lands $16 million in funding” for more info.

I think Brightcove typifies the type of stiff competition that BBiTV will be facing. While digital cable is going to be around for a while, I think the key will be to tie the Web/Internet to my TV.

What I would DREAM about having would be a way to surf around the web, find (legal) videos, then direct them to be downloaded to my Tivo, which I could then watch at my leisure. And if the site has an RSS-type feed, let me subscribe to it, podcast-like, and get new videos sent to my Tivo.

Now you’re talking.

VC Competition

John Battelle’s blog is reporting that Yahoo and Google are effectively setting themselves up as VC firms, sorta.

The logic is simple: if they see a promising company that’s in their space, they have the expertise to do a good due-diligence, and they also have the cash to snap them up before VCs get to them and raise their valuation.

In short: Google/Yahoo are getting startups for cheap by getting in earlier than VCs do.

Now, we don’t know how long this will last, but you could do a lot worse than identify some technology that Yahoo/Google will want and then building it “real” enough so that you get bought out.

Startup rumored to be acquired for $60M before they even launch

Wow, talk about a great burger!

There’s apparently some hot and heavy rumors flying around the Valley that Riya, a cool company that can do facial recognition on your photo collection (Imagine searching for all the photos with “mom” and “baby” in them!) was acquired by Google for $60M.

What’s even more interesting is that they didn’t even officially launch the company yet! Apparently they are (were?) going to launch at a party this Friday.

Riya was started with $4M.

Hmm….invest $4M, flip for $60M. Not bad. Not bad at all (depending of course on the pre money valuation at which the $4M was invested). Some say they sold out too soon, and that may be true, but that kind of thinking is based on a belief in Scarcity, not Abundance. The Abundance way of life says there are many more Riyas waiting to be built. The Scarcity way of life says there’s only one Riya and it’s your only chance to succeed.

I believe in Abundance.

Hat Tip:

Nial Kennedy
Om Malik
Paul Kedrosky

If you can’t talk about your product, you’ll never sell it

I’ll never forget a recent conversation I had with an entreprenuer who was trying to raise money for his product. The conversation was a complete disaster for both of us.


His plan was to take me through his powerpoint slides (which for some reason never made it to my inbox in the first place) and then ask for my advice on helping him put together an investor pitch.

What happened was that instead of sitting through powerpoint slides, I started asking him questions over the phone about his company, product, etc. I forced him to think and act on his feet, peppering him with questions about how his product worked, how I might use it myself, and things of that nature.

He wasn’t prepared. Some of the telltale signs were that he…

  • …kept referring to a slide deck that I didn’t have.
  • …was unable to quickly and easily explain what his product did.
  • …couldn’t explain how I as user would use it.
  • …couldn’t answer my questions on how I would configure the product.
  • …was getting increasingly agitated because I kept asking questions.

At the end, the guy got really pissed off and we ended up hanging up on each other. Not good for either side.

So many times I get approached by entrepreneurs who are expecting to make a well-rehearsed presentation. And so many times their whole house of cards falls apart because I start asking them questions, attempting to engage them in dialog instead.

And the reason why it falls apart is not because they can’t present or can’t hold a discussion or because my questions are too stupid, it’s because they really don’t know their business well enough. They either haven’t explained how their product works to enough of their friends, or haven’t really looked into their competition sufficiently or really don’t understand the customer.

Now, all of would have been OK with me because that’s what I’m here for: to mentor. In this specific case, the entreprenuer also had an extremely bad case of “I’m smart, you’re stupid, I’ve read all the books, so shutup and just polish my presentation so I can go and raise some money”.

So what’s the moral of the story? I’ve got two of them:

  • Know your stuff enough to have an informal conversation well enough to sell your product to a customer.
  • If you don’t know your stuff, know that you don’t know your stuff and be open to assistance.

Simple tips to follow if you’re going to pitch a VC

Jason Caplan put together a brief but effective list of your todo’s before you pitch to a VC. This is more a nuts-and-bolts collection you should follow that pertain to the mechanics of the pitch and includes:

  • Research beforehand
  • The basics
  • Your presentation
  • Answering questions
  • Spend time asking about the VC
  • Before you leave, ask for the order
  • Always Follow-up

Definitely a good read.

Geek’s guide to fundraising

If you’re a geek, and you have a dream to start up a Startup, “How to Fund a Startup” is a must-read. Paul Graham gives an awesome, down-to-earth review of what it’s going to take including:

  • Raising money from friends and family
  • Bootstrapping it yourself
  • Angel Investors
  • Seed Investors
  • VCs
  • Term Sheets

There’s only one kind of marketing

…and that’s “Word of Mouth”.

I’ve been thinking about this for a while and this post from Brad Feld, “Are Customers Your Best Marketing?”, drove me to finally jot down some bullet points on how I feel about Word-of-Mouth marketing.

Here’s Kay’s law #21: “The amount of marketing dollars required to generate sales is inversely proportional to the product’s buzzability”.

Buzzability = ability to generate activity via word of mouth discussions.

Whenever I think about spending marketing dollars, I think about how much money Google spent to market their search engine: Zero.

I’ll bet you can remember exactly how you found out about Google and of course it was through a friend.

So what simple rules can we take away from the Google lesson that can help you figure out how to increase your product’s buzzability?

  1. Your product has to be superior to the competition. As superior as Google’s was over Yahoo’s (at the time).
  2. Customers must be able to easily (trivially, actually) describe what your product does and how their friends can try it. Your goal should be to come up with a single statement that you and your customers can use that instantly describes your product so that new customers “get it” immediately.
  3. New customers must be able to try your product with a near-zero effort (how much work did it take for you to try the new Google engine back then?).

Leighton Chong once made a point that many new inventions are really superior, but they take too much effort on the part of the customer and so they fail. One of the biggest problems I had with one of my previous companies was that our product rocked but was difficult to explain, hence customer’s couldn’t explain it to their friends, and so we had a big challenge in getting the word out.

You want success? Make sure your product hits those three points and watch your word-of-mouth marketing take care of the rest.

Might VC’s get squeezed?

I had the pleasure of meeting Paul Graham in person at MIT when I was invited to speak about Titan Key’s technology. He’s a good guy.

He raises some interesting questions in this essay, “The Venture Capital Squeeze“. His main point is that there is too much VC money chasing too many deals and this is further exacerbated due to a dramatically lowered cost of developing web-based technology.

Paul may be correct on this points, in the realm of Web 2.0 startups, but I’m not sure if I would make that kind of a blanket statement that applies to the VC industry in general. Biotech companies need tons of money to get started, so I’m sure that once VC’s figure out that software startups need 1/10 the cash they used to, the other 9/10ths will go to different kinds of companies (or, perhaps China and India) that needs the money.