Archive for the ‘Startups’ Category

TechCrunch vs DEMO – by the numbers

Thursday, September 4th, 2008

Edit: Updated status for Metaplace, Orgoo, and VUVOX based on comments. Numbers updated based on that, but analysis wasn’t really impacted (though there may well be more updates coming). Updated CircleUp status.

I’ve been mostly ignoring all the TechCrunch50 vs DEMO 2008 back and forth as they battle it out for the title of best startup launch conference.  However, Scoble’s post where he talked about his impressions of how they match up got me thinking.  Since I’m an info and analysis junkie, I decided to spend a couple of hours the last two evenings to put together a quick, as objective as possible, shootout between the two to see how good they really are at selecting the best startups and acting as a launchpad for them.

Here’s how I did it.  I grabbed the list of companies from TechCrunch40 and Demo2007. I then clicked onto the homepage and looked for a news/about section.  If I didn’t know anything about the startup I did a quick Google web and news search as well.  Based on that, I ranked each one as follows:

0 – Dead
1 – Inactive (no news/updates for 6+ months, no evidence of any traction)
2 – Active (working away, making progress)
3 – Successful (lots of positive activity, major funding/customer/press/buzz/etc)
4 – Killing It! (dominant market position, major revenues, big exit, etc)

(Note: I spent about 1 minute per company on this, so there will almost certainly be some mistakes here, feel free to comment/correct – I did this just to satisfy my own curiosity, not to make any sort of definitive analysis)

So, how do they stack up?  First, the numbers:

Demo 2007:
Demonumbers

Average: 1.9

TechCrunch 40:
Tcnumbers

Average 2.2

Now, the analysis.  Overall, they don’t look hugely different in outcome and the numbers on the edges are still pretty small, but the edge definitely goes to TechCrunch.  Not surprisingly, the most common status of startups from both conferences a year later is that they are plugging away, building their businesses.  But in this small sample, the failure rate of Demo companies is significantly higher.  Most importantly, about a third of the TC companies have hit some major success milestones as compared to less than 20% of their Demo counterparts.   

So, if you’re a startup, based on last year’s results TC really does look like the better launchpad.  And if you’re a journalist, investor, dealmaker, jobseeker or whoever else interested in the startup world and looking for the next big thing, your chance of picking a winner looks to be higher at TechCrunch.

Here are the buckets I put companies into, obviously there’s some subjectivity here, but 90+% of my decision was made based on the info on their own websites (please note any errors due to name changes, stealth mode, etc in the comments):

TechCrunch 40
0: GotStatus
1: app2you, Cognitive Code, CrowdSpirit, Loudtalks, Metaplace (Areae), Orgoo, Teach The People, Wixi, XTR3D (Extreme Reality)
2: 8020 Publishing, BeFunky, BroadClip, CastTV, Ceedo, Cubic Telecom, DocStoc, FAROO, Kerpoof, mEgo, Metaplace, MusicShake, Orgoo, Ponoko, Spottt (AdBrite), Story Blender (Enfra Networks), Trutap, Viewdle, Yap (a couple of those arguably 3)
3: Cake Financial, Clickable, Flock, FlowPlay, Kaltura (DemoPit WildCard), PubMatic, TripIt, WooMe, Xobni, Zivity, ZocDoc (a couple like TripIt, Xobni arguably 4)
4: Mint, Powerset

Demo 2007

excluded due to stage of company: Adobe Systems, Inc., Aggregate Knowledge, Alcatel-Lucent Ventures, blinkx, Inc., Boston-Power, Inc., ClipSyndicate, a service of Critical Mention, Devicescape Software, Inc., Seagate Technology, SupportSoft, Inc., Symantec Corp., Wyse Technology, Inc., ZoomInfo
0: BUZ Interactive, Mobio Networks, Reveal Technology, Inc., TeleFlip, Inc.
1: Brevient Technologies, Inc., CircleUp, Inc., DARTdevices Corp., DesignIn, Inc., GoWare, Inc., Honeypitch, Inilex, Inc., iqzone, inc., Iwerx, LLC., My Currency Co., Nuvoiz, Inc., OurStory, PairUp, Inc., VUVOX Network, Inc., Yodio, Inc.
2: 6th Sense Analytics, Inc., Attendio, Inc., Bling Software, Inc., Boorah, Inc., Ceelox, Inc., CircleUp, eJamming, Inc., Eyejot, Inc., Helium, Inc, ink2 Corporation, Integrien Corp., LiveSquare.com, Magnify.net, Mission Research, Mixpo Portfolio Broadcasting, Inc., Panjea.com, Preclick Corp., QTech, Inc., SharedBook, Inc., Shipwire.com, SOASTA, Inc., SplashCast, Inc., TextDigger, Inc., ThePort Network, Inc., Total Immersion, Trailfire, Inc., Triumfant, Inc., WHISHER.COM
3: Jaman.com, Inc., Kauffman Innovation Network, Inc., Me.dium, Inc., Nextumi, SailPoint Technologies, Inc., Serendipity Technologies, Inc., Vringo, Inc., ZINK Imaging, LLC.
4: Nexo Systems, Inc., VUVOX, Zoho / AdventNet, Inc.(Nexo and VUVOX were both relatively small deals, but hey, I’m an entrepreneur too, so I’ll be optimistic about these exits!)

The different levels of beta testers

Thursday, June 5th, 2008

We recently launched the beta program for ClearContext Personal.  I was planning to have my next blog posts here be about our product planning process and how we put together the product plans for our ClearContext Personal and Pro products, and the things we learned by first focusing on the needs of very sophisticated email power users with an incredible pain point of dealing with huge volumes of important and time-critical email.  I’ll get to those soon, but first I wanted to make some observations about our recent beta push.

When we first started ClearContext, our initial beta testers were friends and colleagues.  These people all provide valuable input, but no matter how  much you push them, they are biased towards you and often give you the benefit of the doubt – and are typically pretty forgiving in terms of the finer points of product functionality and user experience.  We still use these people as the first wave of people to give us friendly input on new stuff we are working on, but we recognize that it’s just that – friendly input.

As we’ve developed a base of customers, one big benefit is that we’ve grown an active beta group of users eager to try out new technology while it is still pretty early in development and provide feedback.  These users are quite vocal about what they want to see in the product and very active and important to us when it comes to defining the final feature set we ship with and the details of how certain features work.  Not to mention helping us find that final round of bugs to fix.  These users have been the core of our beta testing process over the past few releases and are a key part of our release process.

We utilized those two groups in testing early versions of our Personal product, including helping us make sure the product was as easy to install and use as possible.  They provided a lot of really good feedback and helped us release a great product that is getting lots of good reviews

When we opened up the beta program to a wider audience, though, we now had a new type of beta tester in the mix.  Many of these beta testers had never heard of ClearContext or anything like it and hadn’t seen any videos or tutorials on the website before installing the app.  Things like ranking your contacts based on how important they are, prioritizing and color-coding incoming email, and providing context around email such as related messages, contacts, and attachments – these were all brand new concepts to them.  We received a lot of useful feedback that was very different from any of the prior feedback when we presented the app to a large group of users who had never seen anything like this before.  One of the biggest things we learned from this process was that even for a lot of very tech-savvy email users, for them to take full advantage of some of the brand new concepts we’re introducing, they could benefit a lot from more guided setup and explanation.  So, we’re adding a lot more of that type of functionality (and a lot more of their feedback) into the product to make it easier for users to understand how best to take advantage of ClearContext – so we can help make their email experience better and reduce their stress and frustration with email.

It’s really amazing that the web provides the ability to get so much great input from such a wide range of users interested in and excited about new technology.  But that input is only really valuable if you understand the perspective of your different beta groups and really listen (and act on!) to what they are telling you.  We’re very thankful to everyone who has helped us in this process and hopefully other companies understand how valuable these people are as well, and how important it is to take full advantage of that valuable resource. 

Pushing out a release always takes longer than planned

Monday, November 5th, 2007

Product
Website
Upgrades
Press/Bloggers
Payment processor
Partners

That’s just a small fraction of the list of things that needs to get finished/written/notified/updated.  No matter how many times I do this, the product ends up being the only one that doesn’t have little loose ends to be tweaked all the way to the last minute.  And that’s probably only because I’ve always done enterprise server software or packaged software applications.  I’m sure we’d be messing with web-based software right to the last minute.  But we got it out.  Time for some sleep now, and more details on the process later.  A number of these sub-items are worthy of posts.

Funding evolution or anomaly? $13.2M from 150+ angels

Wednesday, October 24th, 2007

There has been a lot of talk recently about the future of the VC market given the abundance of capital in the market and the relatively lower amounts of capital now required to get many companies off the ground.  Firms like Y Combinator, Hit Forge, and First Round Capital are a few of many new firms investing in tech these days.  Some of these firms look more like incubators (remember 12 Entrepeneuring and campsix?) while others look more like traditional seed VCs, many of whom kept increasing funds under management to levels where smaller seed investments no longer made sense.  Plenty of new small funds that straddle the angel/institutional VC fence are starting all the time as individuals cash out from Google and other firms and look for something different. 

With so many different takes on the best funding vehicles for the new generation of tech startups, I found the funding announcement about LinkStorm to be pretty interesting.  "Linkstorm raises $4.2 million from 60 angel investors — The total is up to $13.2 million; the company had already taken $9 million from 150 individuals" writes VentureBeat.  Traditionally it has been pretty rare to see large funding rounds from big groups of angels.  The reasons given are typically time needed to pitch a large number of people, logistics/management of communications with a large group of individuals, and hitting reporting requirements once the number of shareholders exceeds SEC thresholds.  Perhaps things change somewhat, though, when there are a vastly greater number of entrepreneurial-minded people out there who are comfortable with taking $100k shots in early stage startups.  I’m curious to see whether this is just an anomaly or if we’ll see other companies going the route of large angel rounds rather than institutional VC.

Friendster Coverage in New York Times – A Tale of Two Articles

Monday, October 16th, 2006

Alright, time to get this blog back in action! Yes, I know I’ve said that before, but now I’m back and recharged after a great few days in Cabo for a beautiful wedding. 

So far almost all of my posts here have been about email, but I also promised to write about the business of startups.  I have plenty of tales from both the VC-funded and bootstrapped startup worlds, so there’s no shortage of stuff to write about.  As a first item, here’s a comparison I think will be eye-opening for many people who are not directly involved in this industry.

TechCrunch and other blogs have covered the Oct 15 ‘06 NYT "tell-all" article on Friendster.  It’s a tale not very surprising to many of us out here in the Bay Area.  But what I find more interesting than the article itself is comparing it to the Jan ‘05 NYT article on Friendster – from the same author in the same publication about the same company, just a year and a half earlier, but well past the time many of the events in the second article took place.  This is a common example of how stories of VC-funded startups are often marketed and spun, it’s rare to be able to compare stories like this side-by-side though.

The beta excuse (part 1)

Thursday, August 24th, 2006

I’ve been meaning to start writing more about startup-related stuff – how we get product out, sales and marketing idea/issues/challenges, funding stuff, etc. – in addition to the email-related articles.  Oh, and also toss in some fun stuff about living in the Bay Area like how to eat at Gary Danko last minute or where to get an excellent lunch for under $3.  I’ll get back to the food stuff soon, but right now I’d like to kick off the startup posting with some thoughts on "Beta" as we are beginning our ClearContext IMS 3.0 Beta program.

Back in my enterprise software days, beta was pretty clear.  We’d develop stuff internally, test it, then get everything ready to release and before officially announcing the release, we’d have a small group of customers deploy the software.  In this process, we’d generally find a few bugs and maybe clean up some APIs, expose a couple more things, etc.

At ClearContext we follow a pretty similar path.  Once a new version is more-or-less working, we start using it internally.  At a certain point, we lock down the feature set, stop doing development on new features and start doing formalized testing and bug-fixing on the feature-freeze version of the software.  Once we’ve tested on a number of platforms and fixed all the major bugs we can find,
we move to an "alpha" which we give to a small group of people.  At this point, there are a number of minor bugs left in the software, the occassional major bug, and a lot of usability and fit/finish things to tune.  We use this period to figure out what fine tuning needs to be done to the product to move to a released "GA" (general availability) production release.  After making these changes, we release a "beta" version of the software.  This is more or less the final release, but by putting it in the hands of a wide range of users with all sorts of different environments who use the product in all sorts of different ways, we generally find a few more bugs here as well as some UI/usability suggestions.  We address those issues, then put out a final "release candidate" as a final check prior to marking it our "production release."

This type of progression was for many years more or less standard in the software industry.  People generally had a good idea of what level of stability/polish/etc. to expect from "alpha" "beta" and other such pre-release products.  However, with the advent of web-based software and services, everything has changed.  Beta now can mean anything from "we’re tossing out some crap we threw together yesterday, not sure if it works" to "this service has been running for a very large user base and is really production software, but we haven’t decided on our pricing/revenue model yet or our final feature set, so we’re just calling it beta until we figure all that stuff out."

And this is where things start to become a potential problem as I see a lot of this trend spilling over into non-web based software products as well.  Because now all of a sudden, "beta" can become an excuse to put out shoddy, bug-ridden product that is really more an ad-hoc market test than anything else.  For companies like ours that still deal in real product that we sell to people on a traditional software basis (as opposed to an ad click revenue model or something), this is an important step in the product development process, and the blurring of "beta" lines definitely makes things more confusing to a lot of users out there.

In my next entry, I’ll talk in more detail about how we run our beta process at ClearContext and some of the things I see in "beta excuse" programs out there that I think do nothing but confuse and irritate users.

In the meantime, here are a couple of interesting reads on the topic:

a blog entry from 2004

a WSJ article from 2005