Posts tagged “startup”

This American Life on selling your idea

Alex Blumberg has a podcast about his journey to start a podcast-related business. A recent episode of This American Life included an excerpt from this podcast (called StartUp), in which Blumberg is half-heartedly pitching his idea to investor Chris Sacca.

They talk for a while, and Alex is having difficulty in explaining his idea and what he’s asking for.

Alex Blumberg: So it’ll take a million and a half dollars, I think. And–
Chris Sacca: Take out the “I think.”
AB: Yeah. It’ll take a million and a half– I’m looking for a million and a half to $2 million in seed-stage funding.
CS: No, no, no, no, no.
AB: Yeah.
CS: You were looking for a very specific amount of money.
AB: I’m looking for– [LAUGHS NERVOUSLY]

Finally, Chris decides he’s just going to show Alex how to pitch his idea and he very masterfully riffs a confident and coherent bit of persuasion. It’s certainly worth listening to, but here’s the excerpt from the transcript.

Hey, look, can I get two minutes from you? So here’s the thing. You probably know me, producer of This American Life, been doing it for 15 years. You know it’s the most successful radio show, top of the podcasts in iTunes, et cetera.

So here’s the thing. I realize there’s a hunger for this kind of content out there and there’s none of this [BLEEP]. It’s just a bunch of jerk [BLEEP] podcasts. Nothing’s out there.

Advertisers are dying for it. Users are dying for it. And if you look at the macro environment, we’re seeing more and more podcast integrations into cars. People want this content. It’s a whole new button in the latest version of iOS.

So here’s the thing. Nobody else can make this [BLEEP]. I know how to make it better than anybody else in the world. And so I’ve already identified a few key areas where I know there’s hunger for the podcast. We’ve got the subject matter. We’re going to launch this [BLEEP]. I know there’s advertisers who want to get involved with it.

But here’s the unfair advantage I have. Because of what I’ve done in my past careers with This American Life and with Planet Money, people are actually willing to just straight-up pay for this stuff. And I’m not just talking about traditional subscriptions. I’m talking– we did this T-shirt experiment at Planet Money where we got $600,000 coming in, where people actually gave us money to buy a t-shirt with our logo on it as part of the content. It was integrated directly. And I know we can replicate that across these other platforms.

So here’s what we’re doing. We’re putting together a million and a half dollars. That’s going to buy us three, four guys who are going to launch these three podcasts in the next 12 months. We think very easily we could get to 300,000, 400,000 net subscribers across the whole thing.

With CPMs where they are in this market right now, I know on advertising alone, we could get to break even. But as we do more of this integration, we get people texting in to donate to this stuff, buying some of this product, doing some of these integrated episodes, I know that we’re going to have on our hands here something that will ultimately scale to be a network of 12, 15 podcasts. The audience is there. They want it. Nobody else can do it like we can. Are you in?

It’s so painful to hear Alex stumble and when Chris takes over, I felt a sense of relief and a certain excitement, to hear an idea presented in a way that was designed to engage and persuade. This is a valuable skill in many aspects of professional life, especially when we’re in the business of sharing ideas. The superlative example in this podcast is quite inspiring.

The relevant section starts at 19:21 in the embedded widget below.

ChittahChattah Quickies

  • [from wstarosta] How to beat Apple [Kottke] – [Apple's fu is strong. But Kottke has some thoughts on how to beat Apple. I would add to his list: Design integrity. Apple didn't invent it, but for some reason their competitors have allowed them to own it.] In the near term, companies making iPhone and iPad competitors are never going to beat Apple at their own game. Apple has supply chain advantages, a massive number of their customers' credit card numbers (why do you think Jobs brings this up at every single Apple event…it's important!), key patents, one-in-lifetime personnel like Steve Jobs and Jony Ive, solid relationships with key media companies, and an integrated ecosystem of stores, apps, applications, and hardware. They are an imposing competitor.

ChittahChattah Quickies

  • Paul Graham writes on "Why TV Lost" – Lots of interesting points in Graham's essay, but I found these two, about the underlying media component of many startups, and the temporal aspect of TV-watching especially thought-provoking: "Now would be a good time to start any company that competes with TV networks. That's what a lot of Internet startups are, though they may not have had this as an explicit goal. People only have so many leisure hours a day, and TV is premised on such long sessions (unlike Google, which prides itself on sending users on their way quickly) that anything that takes up their time is competing with it."
  • Where does Twitter go from here? – My post on Core77 about how Twitter can think about evolving its overall user experience as it straddles lead users and mass awareness
  • Logic+Emotion: Skittles Smackdown, A Sociological Viewpoint – Nice words from David Armano, pulling out something I wrote yesterday about the Skittles/Twitter PR experiement

Good and bad ideas in the daily paper

Adam Richardson recently wrote a strong critique of the San Francisco Chronicle – both their unattractive redesign and their poor content.

Although Monday’s Chron featured anti-elitist sneering about Nate Silver’s semi-failed Oscar predictions, I was impressed with a new feature, where startups get feedback about their ideas from venture capitalists.

They’ve done a good job at tying this coverage to a unique aspect of the San Francisco Bay Area:

Silicon Valley, long known as a hotbed for innovation, has one of the highest concentrations of startups and investors in the world. At any one time, 20,000 entrepreneurs in the valley are thinking about starting companies, and as many as 8,000 are circulating business plans and looking for funding

One example: Mojamix: Breakfast enthusiasts personalize their own cereal or granola online and have it shipped to their door in just a few days.

David Pakman, partner, Venrock: I’m skeptical that consumers at scale actually know enough about what ingredients go together to make a breakfast cereal or granola they will like and will taste good. If I pick dried cranberries over raisins, will I like it less or more? Kinda have to taste it to know.

Mass customization of food products is indeed an interesting trend, but I wonder if it is better to focus on areas where the customer does not have to taste it to know if they will like it.

Margins in food products are low and are thus only interesting at scale, so Mojamix would need to demonstrate that the lifetime value of a customer is large enough to afford the customer acquisition costs that would be required to attract lots of customers.

As I’ve written before, I appreciate the ability of some VCs to look at an idea and consider many facets and contexts.

Sure, this sort of material is available elsewhere, especially online, but seeing this piece in the mainstream media was refreshing.

ChittahChattah Quickies

  • MediaMaster is shutting down – We did some really interesting user research to help define the overall value proposition, concept, and user experience. Exciting to see what they were able to do but obviously disappointing to see where it ended up a few years later. "Don’t wait for large corporate partners to make your business viable, it needs to be so on its own. Design it well from the start, it helps when you don’t have to re-engineer the interface, it’s the most complex part! (That was not a problem we had)"

Could Driveway be the new

Driveway is brand new online file sharing service. But Driveway was an online file storage service that shut down in 2000.

Driveway, 2000

Driveway, 2007

Driveway’s original heights and crash weren’t as spectacular (except perhaps to the players involved) as other web 1.0 flameouts (ahem, learning experiences), so it’s reappearance (owned by an entirely new company) won’t be as buzz-worthy as the Second Coming of Boo but I still thought it was worth a mention.

Perhaps we’re in for a wave of remakes in the dot-com space. WebVan 2.0, anyone?

Iteration is Innovation

One of our recent clients, MediaMaster just launched their product, that “lets you store all your music on the internet and play it from any internet-connected device.”

Their path from idea to launch has been a fascinating one (and I don’t know most of it, I’m sure). They came to this with a hand-coded technology to rip (via a CD jukebox) many albums in sequence, sort of a mass-scanning technology for CD ripping. But if you are going to rip the same albums over and over again, it’s time- and cost-effective to simply already have a copy of them already ripped and rather than rip, why not just check liner bar codes for proof of ownership and download the songs already on hand? And since the songs are already online, why not tie it to purchase of a new CD, and why not keep the music online permanently?

They dealt with a crazy mess of technological afforandances, changes of behaviors, retail and other partnership challenges and on and on. We did an online survey with some concepts, and then took concept boards out into homes to talk to different types of hypothesized target customers.

The product development process deals with a lot of moving targets, but startup folks deal with an excess of that challenge, collating input and constraints from so many quarters, it must make them crazy.

I’m excited to see the product launch, and to see where they’ve ended up with it, given where we were at during those rounds of research. I don’t know their business model, since the service is free right now. It’ll be fun to watch what happens with it and see if they make it succeed.

Under the Radar: video startups

Under the Radar is a showcase of early-stage innovation. Events feature several companies in one sector presenting to a panel of VC judges. Judges and attendees pick the company most likely to succeed and discuss the future of the presenting companies’ industry sector.

Last night I attended my first such event, hosted by Orange R&D. There were actually 7 companies, and the panel didn’t in fact make any overall picks.

Living and working in Silicon Valley means that I’m not immune from lingo like “burn rate”, “angel-funded”, “series-A”, “[something]-play”, “the eBay of [something]” and beyond, but this was my first formal in-depth exposure to this scene.

The companies shown were podaddies (dynamic video ad network), CastTV (video search), Veodia (enterprise video distribution), Nexage (video on mobile phones), Eyespot (editing/mashing up video on the web), ComVu (mobile video sharing), and OneCast (turnkey venue-based video).

The ideas were all very different and so some just were more easily explained than others, some were better presenters than others. Some were prepared to pitch to investors, others like CastTV were funded using money from their previous startup and there was an interesting comment about not wanting to bother with dealing with investors this time around. Isn’t that a sign of the latest dot-com economy; that companies can do a lot without millions of dollars?

Some folks were slick, some were slick but without merit (the video editing tool that was framed as telling stories since stories are important but offered nothing more than a way to butt clips together and overlay music – that’s not storytelling, sorry).

But the greatest part was the panel – it was a neat form of a crit, really. They asked great questions, shared their own concerns, picked on the weak, challenged the strong, and just emitted so much wisdom and experience (without much attitude) that I was very impressed. I mean, that’s the job of a venture capitalist, to be able to assess new companies based on having seen a million others, but for me to get to see that live and in the flesh was very neat.

There was little discussion of culture, or users; it was mostly about technology and markets, but that’s okay, I learned a bit just being part of it.

Is the Next Silicon Valley Taking Root in Bangalore?

When I spoke at Easy6 earlier this year, some of the speakers reminded their audience that companies were doing business in India becaus of the innovation spirit, not because it was cheaper. There is some evidence that it’s actually cheaper elsewhere, even. I wondered at the time how much of that was just blowing smoke; a big lie that people have bought into so they can have pride and work hard and not be seen as America’s Call Center, etc. So it was cool to see an American perspective supporting that supposition in the New York Times.

Read-Ink, one of the self-financed operations, is developing an advanced handwriting recognition software that can read scanned forms, claim forms, medical records and even digital tablets.

Its founders, Thomas O. Binford, a retired computer science professor from Stanford University, and his wife, Ione, a former manager at Hewlett-Packard, arrived here four years ago with five suitcases. They say they are now close to signing up their first business customer.

The signs of this shift toward high-value work are becoming more visible. Executives at Silicon Valley Bank, which is based in Santa Clara, Calif., and provides consulting services to technology and venture capital firms, said they were seeing twice as many Indian start-ups looking for capital investment than even a few months ago.


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