Flickr founder looks to strike lightning again
– Connie Loizos is a contributor to PE Hub, a Thomson Reuters publication. This article originally appeared here. –
Stewart Butterfield has it made. He’s famous for co-founding the popular photo-sharing service Flickr in 2004. He lives comfortably in Vancouver, having sold Flickr to Yahoo for a reported $35 million in 2005. And investors including Accel Partners and Andreessen Horowitz have thrown $17.2 million behind his two-year-old game company, Tiny Speck, even though the Flash-based multiplayer game it’s been developing, Glitch, hasn’t launched publicly yet.
So why does Butterfield confess to living in “perpetual fear” these days? The truth is Butterfield is under enormous pressure. Expectations for Glitch, which Butterfield describes as a “shared, perpetual game with its own ecology,” are exceedingly high, both because of Butterfield’s personal brand and its ephemeral launch date. (Even after two years of alpha and beta testing by roughly 20,000 gamers, Butterfield declines to disclose when he plans to release the game. “We haven’t finalized (the release date) yet, though the end of September is likely,” he says.)
More significantly, Glitch is hard to categorize. Butterfield credits Zynga — the online gaming company behind the Facebook hits — as “the best thing that could have happened to us, pre-launch. Now there is something like 150 million people who previously didn’t think they’d play a game online and now do.” But Glitch aims to deliver a much higher level of engagement than Cityville or Farmville, two of Zynga’s most popular titles on Facebook. Butterfield says that it’s hard to play Glitch satisfyingly for less than 15 minutes at a time, and that Glitch’s beta testers play an hour on average — with some playing for up to six hours at a time.
At times, what Butterfield seems to be describing is a massively multiplayer online game (MMO) that Facebook gamers can play. The game of Glitch — which involves traveling billions of years back in time in order to re-create the future, by creating and collecting resources, gaining skills, and completing quests in increasingly challenging environments – will invite users to customize their virtual homes or to buy clothing items for their avatars. (Subscribers will receive more customization options, and be able to purchase more a la carte.)
Butterfield will also allow “third party developers to use your avatar and have it show up on other games that people can play in different environments.” The idea is for Tiny Speck to act more or less like a publisher, where developers create games, and Tiny Speck strikes deals with them. Butterfield isn’t sure what those deals will look like yet, however.
What Glitch won’t do, he insists, is allow users to pay to advance in the game. According to Butterfield, “the perception is that it’s unfair, but also, because (games that invite users to spend to get ahead) basically present stop signs with dollar signs,” such games can quickly alienate users.
Founder-market fit a key for startups
– Chris Dixon is the co-founder of Hunch and of seed fund Founder Collective. This blog originally appeared here. The views expressed are his own. –
An extremely useful concept that has grown popular among startup founders is what eminent entrepreneur and investor Marc Andreessen calls “product/market fit,” which he defines as “being in a good market with a product that can satisfy that market.” Andreessen argues persuasively that product/market fit is “the only thing that matters for a new startup” and that “the life of any startup can be divided into two parts: before product/market fit and after product/market fit.”
But it takes time to reach product/market fit. Founders have to choose a market long before they have any idea whether they will reach product/market fit. In my opinion, the best predictor of whether a startup will achieve product/market fit is whether there is what David Lee calls “founder/market fit”. Founder/market fit means the founders have a deep understanding of the market they are entering, and are people who “personify their product, business and ultimately their company.”
A few points about founder/market fit:
Founder/market fit can be developed through experience: No one is born with knowledge of the education market, online advertising, or clean energy technologies. You can learn about these markets by building test projects, working at relevant companies, or simply doing extensive research. I have a friend who decided to work in the magazine industry. He discovered some massive inefficiencies and built a very successful technology company that addressed them. My Founder Collective partners Eric Paley and Micah Rosenbloom spent many months/years becoming experts in the dental industry in order to create a breakthrough dental technology company.
Founder/market fit is frequently overestimated: One way to have a deep understanding of your market is to develop product ideas that solve problems you personally have. This is why Paul Graham says that “the best way to come up with startup ideas is to ask yourself the question: what do you wish someone would make for you?” This is generally an excellent heuristic, but can also lead you astray. It is easy to think that because you like food you can create a better restaurant. It is an entirely different matter to rent and build a space, market your restaurant, manage inventory, inspire your staff, and do all the other difficult things it takes to create a successful restaurant. Similarly, just because you can imagine a website you’d like to use, doesn’t mean you have founder/market fit with the consumer Internet market.
Founders need to be brutally honest with themselves: Good entrepreneurs are willing to make long lists of things at which they have no ability. I have never built a sales team. I don’t manage people well. I have no particular knowledge of what college students today want to do on the Internet. I could go on and on about my deficiencies. But hopefully being aware of these things helps me focus on areas where I can make a real contribution and also allows me to recruit people that complement those deficiencies.
The most successful product/market fit is achieved when the founder has a good experience of the market. If the founder really understands the market she can be effective with a new product or service because she understands the needs of the market. Once you have satisfied the market needs you have the necessary skills to create a new product-market fit. The Small Biz 1 article “Advertising a New Product is as Easy as 3-2-1″ talks about the importance of market understanding and knowledge in order to successfully market a new product: http://smallbiz1.com/advertising-a-new-p roduct.html
Entrepreneur’s tweet sparks fight with angels
– Connie Loizos is a contributor for PE Hub, a Thomson Reuters publication. This article originally appeared here. –
Last month, entrepreneur Matt Mireles published a tweet, asking: “Why is TechStars NYC run by a non-entrepreneur?”
The “non-entrepreneur” in question is 29-year-old David Tisch, whose grandfather built Loews into a Fortune 100 company that operates hotel chains, and whose family’s largess has helped bankroll numerous institutions, including the Tisch Galleries at the Metropolitan Museum of Art, and the Tisch School of the Arts at NYU. Since 2007, the young Tisch has been seed-funding startups with his brothers. According to his LinkedIn profile, he has also started two Internet companies, both of which were shuttered in less than a year’s time.
Surely, Mireles isn’t the first to wonder whether someone with Tisch’s background can fully appreciate the challenges that struggling entrepreneurs face. But the New York angel community’s reaction to Mireles’s apparently sincere question was surprisingly harsh. “I would recommend reserving judgment until you meet and know someone before you insult them publicly and passive-aggressively,” tweeted Chris Paik of Thrive Capital, a seed-fund in New York. Josh Stylman, an entrepreneur and seed investor who has stakes in Betaworks and GroupMe among other startups, called Mireles a “judgmental d**chebag” on Twitter.
Other comments were milder although somewhat defensive. “David is one of the good guys,” tweeted Hunch co-founder Chris Dixon, who is also a member of the seed-stage investment group Founder Collective. (Tisch smartly declined to weigh in, at least publicly.)
That something legitimate should cause so much consternation and trash-talking is concerning. Angel investors often claim that they provide an alternative to the rigid orthodoxy of venture investing. Collectively bashing an entrepreneur who dares to pose a reasonable question is more than unseemly: it’s as provincial as the herd mentality that many angels commonly associate with Silicon Valley VCs. No wonder Mireles fears his public smack-down could stifle other entrepreneurs from speaking openly about their opinions. As he told me yesterday, any entrepreneurs who “witnessed this little episode [will] be more afraid and less likely to call bulls**t when they see it.”
Maybe Mireles doesn’t get much respect because his startup, SpeakerText, a transcription service for Web audio and video, isn’t setting the world on fire. SpeakerText recently raised more than $600,000, including from Lotus founder Mitch Kapor and Dave McClure’s 500 Hats, but it’s still eking out revenue by charging $2 per minute for the transcriptions. In fact, Mireles is still rooming with his co-founder.
why would an entrepreneur take the time to run a convention. These people are driven to take big risks and build big things.
They also tend to fail; a lot.
From an economical perspective of reward for time investment, do you really want them running a convention? Do you want to attend a high risk high stakes convention?
Can you imagine a professional convention where you where all talks are limited to 5 minutes, where everyone gets a microphone, where the speakers in the room come from some brilliant but random pool, where lunch ends up being a potluck? entrepreneur like to do new things, so don’t expect to see something that has been done before.
If you want a predictable, well organized convention, get an administrator. Don’t get an entrepreneur.
Is Bit.ly’s Twitter advantage unfair?
The rise of Twitter as a social-media powerhouse and its micro-blogging platform has created a renewed urgency for URL-shortening services.
There are now endless numbers of websites vying to shorten your too-long tweets to conform to the 140-character limit, but as in every competitive industry not everyone can survive and thrive. This week one of the players, Canadian-based Tr.im (owned by Nambu Network), announced it was throwing in the towel.
Now a small business closing up shop is not normally newsworthy, except when they cry foul as the ship is sinking. While on the one hand Nambu president Eric Woodward told Computerworld’s Gregg Keiser that Tr.im was “accepting the realities and moving on,” he also seized the opportunity to take a shot at Twitter for making Bit.ly its default URL shortening service.
“They’re the default, and even if we’re better, it won’t matter, so what’s the point?” said Woodward. “As soon as Bit.ly was made the default, the game was over.”
Tr.im initially announced its demise through a blog post last Sunday, but 48 hours later did an about face to say it had been resurrected and will keep on trimming those URLs “indefinitely, while we continue to consider our options in regards to Tr.im’s future.” (see Tr.im blog post)
Tr.im further stoked the Bit.ly-Twitter relationship debate, by adding that “Bit.ly has a monopoly position that cannot be challenged with reasonable investment or innovation unless Twitter offers choice. This is a basic reality of challenging monopolies. Bit.ly has deep personal connections and agreements with Twitter that we simply cannot compete with. And it is our humble opinion that this type of favoritism will become an issue for all Twitter developers.”
If having Bit.ly as Twitter’s go-to link shortener is unfair, you would think industry-leader TinyURL would join in the debate. After all it was Tiny’s Twitter perch that Bit.ly usurped back in May. While Bit.ly has quickly become tops on Twitter, overall TinyURL still controls more than 70 percent of the market (see Tweetmeme report from March 2009). TinyURL founder Kevin Gilbertson appears unfazed by Tr.im’s attempts to kick up a dust storm around this issue and certainly has no plans to cease operating now that Tiny is no longer Twitter’s best man.
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What the Tesla founders’ feud can teach entrepreneurs
High-powered electric-car startup Tesla Motors has hit a speed bump with the filing of a lawsuit by former CEO and founder Martin Eberhard.
The libel suit, filed on May 26 in San Mateo County, Calif. Superior Court, alleges current CEO Elon Musk falsely portrayed himself as the founder of the company and orchestrated Eberhard’s ouster as original CEO in 2007. In the lengthy 22-page document, Eberhard accuses Musk and Tesla of, among other things, libel, slander, breach of contract, negligence and failure to pay wages. The suit doesn’t even refer to Musk as a co-founder, but simply as one of “various investors,” who joined the Tesla board in April 2004.
Eberhard’s suit claims that from the moment he came on board, Musk “began a campaign to appropriate control of Tesla Motors and Eberhard’s legacy as the company’s founder and visionary.” The suit further alleges that Musk “began a pattern and practice of defaming and disparaging Eberhard in various widely distributed media outlets,” a few of which included The New York Times, Newsweek, USA Today and NPR.
Musk has responded to the accusations in a lengthy blog posting on Tesla’s corporate website. According to Musk, the posting is an attempt to “correct several misconceptions propagated by Eberhard that are now being reported as truth.”
While claiming he was “pushed out of the company he founded,” Eberhard agreed to leave because he felt it was “in the best interest of Tesla” and that he hoped his “vision for the company would be realized and his spirit would continue even in his absence.” Something Eberhard now feels never happened.
In a further bizarre twist, Eberhard accuses Tesla of giving his own personal Roadster – the second model off the production line and one valued “as high as several million dollars because of its historical value” – to one of Musk’s friends. His suit claims when Eberhard eventually received his own Roadster, it had been “smashed into the back of a truck.”
I’m excited about electric cars news but tired of hearing about Tesla Motors- until they start producing cheaper models. For electric cars to be serious contenders, they need to be mid-priced economy vehicles that most households can by with tax incentives etc. According to new reports, up to 1/3 of cars buyers want to go electric- which would reduce oil dependency, green house emissions, foreign oil dependency, health care costs, and create jobs. For more information about electric cars, I suggest checking out the website http://www.twocentspermile.com or http://www.bit.ly/2centspermile
