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Archives for: June 2013

There were 35 posts published in June 2013.

Tech Talent Wars and The .EDU Disconnect

The statistics are startling and the chatter is consistent: companies everywhere are struggling to find Software Engineers. The headlines ring hilarious, but true, declaring ‘Talent Wars’ across the tech sector. The number of open engineering roles is on the rise and all anyone in tech can talk about is the challenge we all face in filling those roles with quality engineers. So you can imagine the shock we feel when we wander over to and hear that only 1 in 10 universities have some form of a computer science program. You read that correctly: 1 in 10.


I’m Jonathan Soares – Co-Founder and COO of Moo Digital, a Connecticut based software development agency where we, like everyone else in this game, are constantly on the hunt for top talent. We aren’t just looking for Engineers, of course – we’re looking for Engineers who view code as their craft. These Engineers make career decisions based on learning and we know we can offer them the opportunity to work on beautiful and challenging projects. However, this is not an easy profile to find. In the right environment, you can teach almost anyone, almost any skill. But ambition? Drive? Those are innate qualities that can rarely be coached.


It was only a few months ago that my Co-Founder and I decided to partake in an additional strategic recruitment initiative. Layman’s terms? Train ‘em. Find bright, driven, and ambitious college students who are interested in software engineering and train them, the right way, through an intense hands-on technical track from the beginning. We had the support of the Technology Talent Bridge Program through Connecticut Innovations and we dove right in after realizing that our solution was within the walls of our company.


We began with the obvious, scouring LinkedIn, Twitter, and Facebook, searching for anyone who had an interest in code; we also attended a career fair at a local Connecticut university. One hundred and twenty five resumes later, we realized that not only was there a large ecosystem of untapped talent, there was also a significant issue with the collegiate engineering track (at the schools where such a track even existed). Most of what these students were being taught didn’t really apply to today’s technical landscape. The basic principles were instilled, but come on. How likely are you to hire a ColdFusion Dev? Not to mention, all of the free online training platforms were completely disregarded.


My partner and I decided to test our theory on 3 interns with 3 separate development tracks: Front-End, Back-End/PHP and iOS. After 4 months of training, we had farmed developers in our very own backyard. Passionate, hard-working, and intelligent students that just wanted a chance to show their ability to learn. A skilled labor force that just needed to be placed on the right path, with mentors who not only cared, but who understood the current technical atmosphere.


The problem I see with companies that are only going after senior level engineering talent is three-fold: first, their pickings are slim because the talent pool is limited (shocking, right?); second, they’re not actually helping the technical community because they aren’t opening their doors to junior level talent where they can access mentors and seasoned Engineers. Third, they are doing whatever they can, at all costs, to retain their engineering talent, which is being poached constantly.


And as for what schools to pull from, our company doesn’t care about academic pedigree. We care that our potential team members are passionate and bright, and that they genuinely want to challenge themselves. Of course they have to have the basic skill set necessary to grow, but whether they are enrolled in Comp Sci at MIT or are going local and spent the past few years hacking away in their parent’s basement, we want to talk to them.


As a community, we have to work together and while that’s not something everyone will be comfortable with in a competitive environment like this one, it is the only solution I see. And frankly, it’s kind of a fun one. If you’ve never sat in a room full of ambitious and bright college-level interns, I urge you try it. You’ll be amazed at what they have to offer and how eager they are to learn. It’s refreshing, it’s exciting, and it’s rewarding.


Of course, you have to be able to plan your workforce. Interns and a training program are just one seed planting initiative for us. We still have a healthy mixture of more senior Devs and we are constantly recalibrating our mix.


The waters are overfished and the only way to repopulate them is to do it ourselves. With time, those nets will stop coming up empty. It’s time to invest in the next generation of Engineers, who in my opinion will innovate exponentially. Pay it forward. Give back. Call it whatever you would like, but we must be the ones to foster their growth. And if you’re anything like us, you’ll have one hell of a fun time doing it.


The Truth About Edward Snowden and the NSA

Behind the walls of Fort Meade, powerful technologies lurk - technology awesome in its power but which can become terrifying if turned against you.


Remember the scene from Batman where he has an entire city’s cellphones monitored? Well, the NSA can do much more than that. Edward Snowden, the 29-year old hacker who is waiting in Moscow for his political asylum to Ecuador, is responsible for “leaking” the fact that NSA has been using that power. And while we are fine with the government using that power where legal applicability is proven, all of us are aghast at the extent to which that power is being [mis]used - this is the true revelation made by Snowden.


We, the Public, knew that the NSA was reading mails and listening in to calls. But we all assumed we were somehow exempt from that surveillance. And nobody suspected that their “like” on a friend’s photo on Facebook would be handed over as server logs to the government’s top secret spy agency.


Everything you do online is logged on a server somewhere. It’s worthwhile to keep that in mind while using the internet. And its only a matter of time before someone [with access] can figure out what you were doing, when, from where and for how long.


I do not blame the NSA. I don’t think they should be reading people’s emails and listening to people’s phone calls. But hey! they are a spy agency. That is what spies do! They spy on people. Edward Snowden was remarkably clever and more importantly- moral and responsible - when he released the documents that the government was so keen to hide from us. Its funny how we constantly see signs that say : “this area is under surveillance”. Maybe its time for us to hang one of those signs inside our homes.


Snowden was adamant that the release should not be used as media fodder- something that most glory hounds desire. He was also careful not to release anything that would endanger his country or the agency he worked for. Remarkable traits in a man accused of espionage-don’t you think?


When the white house petition to pardon Edward Snowden reached 100,000 signatures, the news made it to the top of Hacker News and stayed there for a long time. People know that Snowden is innocent. And that’s important. Edward Snowden has educated people around the world. People are now talking about the Internet and the PRISM project and are more careful with what they do online. In fact, the search traffic to - a search engine that does not track its users like Google does -  experienced double the traffic a week after the PRISM revelations.


People now know that their communication is not secure. That the online anonymity that they thought existed, doesn’t. As individuals there isn’t anything we can do about it other than be more careful. Its amusing to hear the people with authority say,”If you have nothing to hide, you should not be so concerned.” They refuse to acknowledge the fact that just because a person has nothing to hide, that doesn’t mean you should stalk her. Nobody wants to be monitored all of the time.


Snowden did not betray his government. If he had wanted to betray the government,, he could have perpetrated horrors with the information that he had access to  by selling it to foreign governments. Instead, he chose to disclose the information - only just enough information necessary and no more- to a newspaper. He believed that people should know if they are being watched without a warrant. That is a sensible and ethical belief to have.


Its a tragedy that Snowden, a privacy activist, is right now stranded in a foreign country waiting for asylum while his home labels him a traitor. Let’s hope the Obama administration considers the petition that was signed and pardons Snowden.

Edit: Edward Snowden is still being sought by the US government. He remained in the airport’s transit zone for over a month while his asylum request was being considered. He has been given temporary asylum in Russia which will enable him to stay there for a year. Snowden’s lawyer told the media that Snowden has left for a “safe place”.

More Messages, More Problems: How Businesses Can Send Fewer, Better Messages


1) Consumers suffer from message overload — and a lot of the messages we get are annoying and irrelevant.

2) This is not just a problem for consumers to deal with — it’s a problem for businesses. The more they annoy customers, the less likely people are to stick around.

3) Consumers keep adding new inboxes-email, SMS, push, social. For every channel, businesses have to add a new piece of message infrastructure.

4) But as businesses layer on new ways of sending messages, the new tools don’t coordinate with the old ones. This leads to crowded inboxes and a poor experience for customers.

5) The next generation of communication companies will do for businesses what designers did for webpages: cut down on the quantity of information, creating whitespace so that messages actually get noticed. This is what Outbound is building.


Inboxes are like Tetris

Think about your inbox. What comes to mind? For me, the image is a marathon game of Tetris. I can find better ways to deal with the inflow-I can install Mailbox, do some filtering, be disciplined about touching every message only once-but it just keeps coming. What would it take to replace Tetris with a different image?

The short answer is that businesses need to start thinking about messages as extensions of their product instead of one-off blasts. The end-result would be fewer, higher-quality messages-and a lot more whitespace around key information. We need to do this for the inbox:

In order to understand how this would work, let’s take a step back and look at how businesses send messages now.


Why the messages just keep coming

The mold was set with email, which has become the universal channel. We get messages from mom alongside flight details and promos from The Gap. As long as there are 1-to-1 messages from people we know waiting for us, we’re not going to stop checking our inbox, and that makes it a very attractive channel for businesses. As a result, the 1-to-1 messages that draw us to email in the first place make up a smaller and smaller portion of our inbox, and we spend more time sorting and less time consuming information that matters.

But that was only round one. Just as email became ubiquitous and started to reach a saturation point, we all got mobile phones. We started off texting our friends, but it wasn’t long before businesses realized that by collecting our mobile number they gained a new channel-inbox number two. We soon upgraded to smartphones with app stores, and we added a third inbox for push notifications.

As each of these channels approaches saturation, it doesn’t go away. New channels just get stacked on the preexisting channels and find new ways to compete for our attention (I’m looking at you, badge app icon!)

Our inboxes didn’t fill up on their own-it took several generations of new infrastructure to enable businesses and nonprofits to message us so steadily and efficiently. Here’s how it got so easy to send messages:


Generation 1: Age of the email service provider

It used to be that when you wanted to email a group of people, you had to type a lot of email addresses into the “To” field. Sure, you could set up a listserv, but that was the domain of the webmaster/admin technical guru, not a task for the common man. And even the listserv was a pretty basic tool. But when Constant Contact, MailChimp, and a dozen other email service providers (ESPs) came along, they not only democratized the listserv, but also made it a lot more powerful by adding open and click analytics, scheduled messages, unsubscribe tools and list segmentation.

Over the past fifteen years, at least six ESPs have grown up to be worth more than $100 million by making these features accessible. These companies opened up the playing field by allowing anyone to do email marketing. As ESPs grew, the best ones realized that they needed to protect end-users as well as serve their customers. The leading ESPs enforce strict opt-in and unsubscribe policies and spend a lot of time educating customers about the right way to do email marketing. MailChimp leads the market (folks on Quora estimate that MailChimp may be worth as much as $1 billion) in large part because of its attention to the kind of email experience its customers are creating for their contacts.

But even ESPs that respect our inboxes can’t manage the new flood of messages from the product across email, text and push.


Generation 2: Rise of the transactional message

As the market for ESPs matured, transactional message providers like SendGrid began offering tools that let developers outsource some of the email drudgery involved in delivering transactional email. Developers still had to define the business logic to trigger receipts, invoices, app content (like new comments) and other product-based emails, but they no longer had to worry about delivery.

Easier delivery seems like an incremental improvement, but it opened up a flood of transactional email: last year SendGrid reported that “web applications are sending an average of 631,000 emails per month, and nearly 50 percent of user actions in web applications trigger an email alert.”

And that’s just email. Twilio is building an empire around SMS and voice delivery, and Urban Airship is doing the same for push notifications. Both of these companies tout better engagement compared to increasingly lackluster email open rates. But as these channels saturate, their engagement rates will erode the same way that email has.


Where does that leave us?

Businesses are sending more messages using more channels than ever before in an effort to capture our attention. Consumers battle a constant flow of messages coming at us across channels, constantly sorting and skimming to separate the signal from the rising noise. We’re all stuck playing a frantic game of Tetris with our messages.


The next generation of message tools will create… whitespace

How did we move past cluttered websites toward beautiful pages with abundant whitespace and intuitive user experiences? We did it by stepping away from our keyboards long enough to listen to users. What do they think of the page? Where do we lose them?

Message tools need to create whitespace around the messages businesses send in order to help people stop and pay attention. Here are some ways to achieve this:

Begin with the user’s context, not the channel. Most businesses start by deciding which channels they will use to send messages, then gradually fill those with messages to push content out. Instead, start with the context: where and when will this person receive the message? Is the call to action (even if it’s just to absorb information) reasonable given this context? A lot of this involves A/B testing-quick iterations through trial and error-but some of it is common sense.

Pay attention to the relationship. If you’re barraging customers with messages or leaving them in the dark, it doesn’t matter how interesting the content is; those people are probably too annoyed to pay attention. A single, unified view of all the messages going to each user across channels and departments allows you to see when you are over- (or under) whelming people.

Give users a say. Analyzing user data helps address both of the points above, but you’re never going to get the full picture of a user from analyzing her data. Just as user testing and feedback often yield surprising insights about how to make a webpage better, we need to gather feedback on messages that is much more fine-grained than an on/off unsubscribe button.


Where to start?

In small companies, these principles produce slight differences in messaging, but over time those differences multiply as message volume and organizational complexity grows. It will take time to build really good solutions to these problems. My company, Outbound, has begun with three simple innovations:

1) We separate message content from channel so that any information can be sent, using any channel, based on the actions that users take. That leaves your options open depending on the context for your message.

2) We log all outbound messages in one place, providing a unified view-the same view your user has of her inboxes.

3) We make automated messages code-free because it’s impossible to iterate quickly based on trial and error if the person who is writing the messages is always waiting for engineering to make edits or change business logic.

This just scratches the surface of what we need to help businesses create fewer, higher-quality messages. But that’s why we’re so excited about this space. Imagine if instead of optimizing for more clicks, companies had a tool that optimized to make you totally satisfied-and kept changing their message mix until you signaled that you were happy. That’s the inbox I want.


Open Source: The Thinking Man's Venture Capital?

Can you make money while giving away a significant part of your company’s intellectual property?

Well, there is Red Hat with its much vaunted billion dollar turnover, and yet many entrepreneurs are still reticent to liberate their own grand plans as an open source product or project.


You could dabble in venture capital funding, by contrast, which involves giving away significant parts of your company. Many see this loss as a fair trade-off since it finances more rapid growth and gives access to a powerful network of contacts and potential customers. But a successful open source ecosystem can deliver many of the same benefits.


Open source and venture backing can both be used to fuel more rapid expansion, and they should certainly not be viewed as mutually exclusive. Open source is no longer the preserve of a handful of intrepid VC fund managers and equity partners.


However, the overlap of many benefits in VC funding and open source development provokes questions.  Do companies using open source development need VC funding? Can open source development be used to supplement external investment? Could open source even be used as a full alternative?


The benefits of a significant capital injection will depend on the company and on the stage of investment. However, nearly all of the most common reasons for seeking VC investment are already covered by building a healthy open source community around your product.


Looking at early stage investment, recipients of external VC funding will typically focus on using the money for speeding the pace of internal product development. By licensing its software liberally and working to build a community, a company built around a popular open source product or project can harness far greater external development resources. Admittedly, with a more open project, the company will have far less control over the direction of these external development resources. However, this simply demands a new skill set: partner and community management becomes a key executive function .


In later stage investment, recipients of VC funding will be more likely to “burn” cash on heavy investments in sales and marketing. Aggressive VCs may even use intensive marketing as a way to get the target addicted to a high burn rate, forcing them into coming back for further investment rounds on far less favorable terms.


An effective open source business model also offers massive benefits for sales and marketing. Strong open source software that answers a genuine business need can very rapidly go viral and distribute itself. It’s common for companies built around open source software to find themselves running to catch up with their software as it goes global.


The more hands-on angel investor might be able to deliver massive value to companies by effecting high-level introductions and opening doors into larger customers, but open source offers a parallel value. “Word-of-message-board” marketing within the developer community can also provide a route into enterprise customers, where bottom-up decision making on IT tools and platforms is becoming an increasingly potent force.


Open source also offers less obvious marketing benefits to the shrewd practitioner. Many companies focused on internal development have to invest heavily into market research and insight from industry analysts. The level of risk involved in conducting the majority of your software design and development behind closed doors is immense. Even with beta testing on friendly customers, the cloth is cut before customers even get to tell you their sizing and what kind of suit they want. You can add a few nips and tucks, but if you make a serious fashion faux pas, the results can be terminal.


With open and community development, customers and partners are involved at the earliest stages of the design and decision making process. Much of the investment in strategic marketing, to provide direction for product development, is rendered unnecessary.


In open source, you can rest assured that if partners and users have problems with the direction you are taking, they will tell you. A company working at the core of an open source community must still provide the lead on vision and direction, as this is the main driver of community building and commercial open source success. However, the level of input and direct contact with the customer removes an enormous element of risk from new product development.


Another major issue for any company looking to expand through external financing is in managing recruitment. Anyone who has ever been involved in growing a business will be all too familiar with how quickly a small, highly productive team can be destroyed and made less productive through bad recruitment choices.


In highly specialized areas of technology and software development, the shortcomings of traditional recruitment companies and processes become painfully obvious. There is the direct cost of recruiting the wrong person for the job in the high-pressure environment of a rapidly expanding company.  The wrong person can also have a “time-sponge” effect on management and colleagues, which can be disastrous.


By contrast, popular open source projects will attract highly skilled developers. External developers who are capable of making it in the harsh meritocracy of an open project must demonstrate their skills, knowledge, and mettle. In addition, many ambitious developers now see contributing to popular or up-and-coming projects as the most effective route into new, exciting, and lucrative positions.


Corporations such as Google, Netflix, Facebook, Sony, Pixar and many others are now releasing a significant amount of open source infrastructure software, purely to act as a magnet to skilled developers they can recruit. Open source can and is being used in the same way by enterprising start-ups.


However, open source is no magic bullet. Just as venture capitalists will only invest in a strong business, you can only build a strong open source community around the most attractive product or project, and competition for developer time is getting ever more fierce.


Despite the polar arguments around open source, it is also far from being a single model for business or development. The 69 software licenses approved by the OSI as “Open Source” differ tremendously, and each has multiple different business models that have been tried around it. Compare Red Hat, Cloudera, Google, and SugarCRM, and the differences between their business models are often greater than their differences with many proprietary software companies.


Even though there is increasing crossover in the form of VC-backed OSS businesses, venture capital and open source development can also be suited to different businesses. The time-investment required to build an open source community may not be suited to an ultra-high-growth business with explosive potential.  Such a business has a significant early-mover advantage and a limited window of opportunity.
OSS is more typically suited to a longer-term business, focused on organic growth. In the short term, OSS can act as a catalyst to rapid international growth. However, the benefits of a community take far longer to realize and are not a quick hit, suited to someone eyeing an early exit-strategy.



Stop Ignoring Your Audience in the Emerging Markets

Our headquarters are located in Estonia, which is a country with 1.3 million people. This country is roughly the size of New Hampshire. Testing products in Estonia is mostly fruitless - the sample size is small enough to be statistically unreliable, even when building a consumer product. Regardless of the limitations, we have connected 80 countries through 300 mobile operators - the largest coverage in the mobile payments industry.

Our highlighting of these numbers is not meant as self-appraisal. Because we don’t have a comfortably large home market, expansion into other countries has been vital for us. It is also something that companies in large, developed countries do not have to worry about and has proven to be a wonderful competitive advantage.


Companies with a large enough user base in the home market are in danger of getting tunnel vision. If you are already at break-even, why would you take the chance of expanding into uncharted territories on other continents? If thinking about launching your product in Brazil or Poland seems risky, it’s because expansion has not been internalized in the company from the get-go. You are essentially giving up on targeting billions of potential customers.


In addition to avoiding risk, another reason for evading expansion is the false assumption that revenue is concentrated in North America and Western Europe. While it is true that the purchasing power in these regions is significantly higher, the other side of the coin is that user acquisition and competition is much tougher as well.

In the mobile payments industry, we can illustrate this disparity by comparing user acquisition costs on the iOS and Android platforms. Android is dominating the emerging markets and user acquisition is almost two times lower than on iOS. Mature consumer economies are flooded with products and services, which means it is much harder for a newcomer to stick out.

One of our most successful markets in terms of revenue is Brazil. This is a country where we have neither an office nor any local employees. There are several reasons why Brazil is huge for companies involved in mobile games:

  • Brazilians has a population of 193 million people
  • Brazil is the second largest market on Facebook after US
  • 31 percent of all men in Brazil are gamers
  • 23 percent of Brazilian Internet users play games regularly


Brazilians love gaming.  So, why wouldn’t you try to enter this market as a game developer? The data above allows us to argue that there is revenue potential there and our own success in Brazil confirms it. However, if you think about your social circle - what percentage of entrepreneurs are planning of expanding into Brazil? It is likely to be very few, as emerging economies are not important for many companies.


If you do decide to differentiate yourself and aim at a market in Latin America, Eastern Europe, Africa or Asia, there key criteria to be considered not usually relevant for US-centric companies:


  1. Language - Forget English.  In Latin America, you need Portuguese (the Brazilian version) and Spanish to guarantee that people can understand you. In Europe, there are 50 countries, most of which have their own language - and so on.
  2. Hardware & connectivity - Not everyone owns the latest MacBook or Galaxy S4 - if your product does not run on less powerful lower-end devices, traction might not be as good as you expected. And if your product needs heavy data usage to work, it would be smart to check what kind of high-speed Internet coverage your target market has.
  3. Design - Open up the homepage of China’s largest instant messaging service QQ and you will notice that it is completely different from what we consider “good” web design. Design is not culturally universal.
  4. Payment options - In Brazil, only one third of the population has credit cards. In order to collect revenue from users, you need to look at what payment methods work in each country - it might be worth considering mobile payments, pre-paid cash cards, etc.
  5. Pricing - The Big Mac Index has a good reason for existing - people in different countries have different purchasing power. Do not expect your product to sell if you are asking for the same prices as in the States.

Emerging markets might seem like a gargantuan challenge at first - foreign, fragmented, and distant. But that’s only because you have not been thinking about them in the past. With China reaching the first position in smartphone sales last year globally, now is the latest point at which you can afford to start reaching out.


Fortumo is a mobile payments company that powers in-app payments for game developers such as Rovio, Gameloft, Vostu and Zeptolab. The company covers 80 countries through 300 operators and lets users make payments on the web and in Android, Windows 8 and Windows Phone apps. For more information about Fortumo, visit For insights into the mobile payments industry, read



The 7 Dimensions of the Language Learning Market

Education is featured regularly in forecasts about the next big thing on the Internet.

Over the last few years, the education industry has seen lots of startups, established companies, and corporates launch  new online language learning products and services. This has lead many to assume that the market quickly became saturated.


However, our users and our daily business experience tell a different story. There is a lack of competition and very few people compare options before making their choice. There is also a lack of clarity about what defines the language learning market.


Allow me to differentiate between the current offers and the market as a whole by exploring their different ‘dimensions.’ These dimensions could also be applied to other online learning segments.


Age of the Learners

Every product is aimed towards a more-or-less specific age group. In the learning medium of language products, we can separate three main groups that have different needs, capabilities, and preferences by asking the question: are we teaching kids, students, or adults?

Motivation for Learning

Following the education type and the learner’s age is the question of why she wants to learn a language: is it to pass an exam, to get a job, or to relocate?  Is it for professional meetings abroad or for a more fuzzy reason like self-improvement, general education, or peer pressure?  On a more trivial side, might it just be for travel?


Type of Education

Learning products and services also differ significantly according to the type of education being provided. These products could be used for formal education, corporate training, or private learning.


The Medium

The first dimension of online language products that I will explore is the learning medium. To understand this medium, it’s important to ask if it is an old-school classroom, a book, a program with audio or video content, a piece of traditional PC software, an online service, or a mobile app.


The Method

The learning method is, of course, not fully independent of the medium.  It still helps to distinguish some major areas of the method , like  blended learning, immersive learning, etc. When considering the language learning method that’s right for you, it’s always important to ask if you learn better from a teacher, from other learners, or on your own.



Learning is always done by individual persons. But there are very different ways for products and services to reach these individuals: public institutions may organise the learning, companies may provide educational materials to their employees, and private customers may simply decide for themselves.


Business Model

Learning products can be monetised in different ways. Very few are truly free, based on donations, or volunteer work. Most teachers, authors, editors, programmers and didactic experts are looking to get paid for their work. There are different business models: money provided by the state, money provided by an employer or institution, and money provided through advertising. It may be paid up-front or on a monthly basis.


These dimensions are neither independent nor exhaustive. However, they can help to bring some structure to the vast market of language learning. They help us to define our segment as a private language learning service that is online, mobile, and self-directed,.  Our customers are adults who choose to learn of their own motivation, make the decision to use our product themselves, and are willing to pay a moderate monthly fee for as long as they use it.


The Seven Dimensions of the Language Learning Market

The Seven Dimensions of the Language Learning Market


What Not To Look For In A Venture Capitalist - Advice from a Series B Startup

In April, the team at Tango Card closed and announced a $4.1M Series B financing.

We considered our round a success for a number of reasons, but first and foremost because of the quality of investors in our round.  More broadly, our investors can help us with the critical triumvirate of startup needs: capital, recruiting, and sales – (and what’s important here is for investors to put you in front of customers that change the trajectory of your growth, customers you could not have gotten in front of by yourself in a reasonable timeframe.)

When you raise capital, you are essentially trying to solve the simple “financing success equation” (FSE) which is this:

FSE: Sufficient capital + Good firm & partner + acceptable time to close = success

Going through this process (which I have now done a few times) also places a very clear spotlight on 4 characteristics of the venture capitalist you want to avoid.

Avoid a Venture Capitalist who does not know your space well.

The above situation does not match the “Financial Success Equation” because it will take you much longer to close your round than you plan if you ever close it.  Why?  If your VC likes your business, but does not know the space, you will enter the ballooning mission creep of diligence hell.  Your VC will ask you to talk to one expert after another – this one knows area A really well, that one knows area B really well, this one could be a potential customer down the road, and that one can help both of us understand any regulatory issues.  Yes, you may actually be better off after this process – crisper on your message, adjusting your mobile app a bit, adding a few things to a job description – but you will also be closer to the end of your business.  In addition to diligence hell, early warning signs are introduction a VC suggests he or she makes and these introductions are way off the mark.  Or, after your 2nd (maybe 3rd) meeting, your VC cannot very accurately summarize your business and value proposition. In addition to all of the facts and data, a VC needs to have a positive visceral gut reaction to your business.  This is really hard for them to do if they are not students of your space.

Exit a process if your VC does not show value immediately

You should expect your VC to ask around about you – any VC will want to talk with customers, to dig into technology, and to subject you to the review of their experts.  You will immediately see the quality of your VC in this process.  The experts on the VC’s side will be serious, experienced, and well-respected folks.  They will dig in and ask you questions, of course, but they will also want to help you if they like what they hear.  The reference process reflects on your VC and it can lead to some very good BD follow-up when the round is closed (even if it’s not closed with that VC!) VCs that talk to customers will be professional.  They will schedule on time, they will call on time, and they will thank your customer for their time.  You will not get an email from your customer saying “Hey, your potential investor never called.” In that case, not only would the investor have wasted your customer’s time, but you would have lost points with your biggest asset –the customer. NOT a good early sign.  If you continue to play through with this type of investor, you will fail to achieve the “Financing Success Equation” because you have the wrong person (and maybe the wrong firm) on your side.

Recognize if you are not a priority

If you’re not your VC’s priority, you need to find someone else. Uncommitted VCs

-Miss more than 2 appointments they set with you. This could be conference calls, office meetings, term sheet due dates, or feedback on key issues. (VCs have packed schedules, but like the rest of us, they prioritize what is important.)

-Talk a lot about the fundraising they are doing.  If they are fundraising, that is a huge time commitment and they may have a hard time focusing on you.  It may also be a sign that they do not have capital available for new investments in their current fund!

-Arrive late to meetings, then leave immediately or early.  Hmmm

-Talk too much (and maybe at all) about all of the other boards they are on.  Hey, I thought we were trying to evaluate my company in the small amount of valuable time we have together.

-Establish timelines that keep changing.  We’ll complete our due diligence by April 10th.  On April 11th, hey we’re moving very fast on our diligence as you can see, and we need about another 7-10 days.

If these things start to happen, you are in deep doo doo.

Finally, beware the simply bizarre

Let’s get the obvious stuff out of the way.  If you do not trust the person you are meeting, if you have observed inappropriate behavior; if you observe lying, cheating, stealing, etc… just run to the door.  But there are other things to think about.  I met several times with VCs that had offices in one place for our first meeting, a new office for our second meeting, and then another office for our third meeting.  I have met with others that could not explain our business back to me after 4 meetings.  And I’ve met with others that are so focused on remodeling and repainting their new office  that they just were not ready to seriously engage.  The point is this – if you see this – even if you are very excited about who you are meeting with, you will fail to match the Financial Success Equation.

For those of you raising capital – good luck! And, if anything, I hope this helps save you a ton of time in your process!

David Leeds

Founder & CEO, Tango Card


Why Are You on Facebook? Your social media plan should be fluid and nuanced

Social activity is fluid and nuanced – your social media plan should be, too. Harness social behavior by knowing the difference between brand advocacy and brand outreach


Ask a marketer why they’re on Facebook, and chances are, you’ll hear some variation of, “I need to be where my customers are.” That’s fair and not incorrect. Social media marketers do need to be responsive to the splintering of interest that’s manifested through the myriad of social channels that have emerged. But, the Web is a big place. For every share that happens on Facebook, two more are happening across the web.


Everyone knows that the social Web is more than just a set of destinations. But the flow of brand dollars to individual social channels tells a different story. Billions have been spent building and maintaining brand pages, buying sponsored tweets and the like. That’s fine if you’re trying to build brand advocacy by getting your most rabid fans to pass your message along, but it’s not the most effective way to reach new customers.


To reach the largest possible pool of potential new customers, brands should look across the entirety of sharing and social activity that occurs web-wide and catch people while they’re in the awareness and consideration phase. These are the folks that have specific brand attributes in mind, but haven’t yet settled on anything in particular. They haven’t said, “I’m eating at Wendy’s today.” Instead, they’ve shared content related to eating on the go, value-dining options, hamburger recipes, or any number of other topics adjacent to the brand. And they’re the audience of receptive folks you can tap with brand outreach by keeping the following points in mind.


Your brand isn’t one-dimensional – it’s comprised of many different aspirational values and attributes – and the ways people arrive at it are not one-dimensional. Your biggest fans are not talking about you all the time. But that doesn’t mean they’re not sharing and considering the benefits you offer that lead them to your brand. So take a close look at how specific content engages users: how and where it gets shared and what kind of response and engagement that drives between the user and their social connections. People share different content in different ways and with different motivations on Facebook, Twitter, and LinkedIn, etc. – and don’t forget that a large amount of all sharing still occurs through the private channel of email.


How and what people share isn’t one-size-fits-all. So how my friend shares content and how I share content are vastly different, as are the channels we decide to use depending on type of content. People’s sharing behavior is nuanced and fluid, and it differs depending on the topic they’re sharing around. If I’m considering lunch options, I’m more likely to do that in a public forum like Facebook or Twitter. If I’m considering insurance plans, I might choose to share about that in a different fashion. Advertisers should recognize that and build their media plans accordingly.


Throughout the customer life-cycle, different actions are appropriate by the brand with regard to its customers. In the research & consideration phase, content created or sponsored by brands is educational or aspirational. Once a consumer is in-market, the experience should be about specific offers that induce purchase.  Brands can drive clicks to specific sites, offer opportunities to sign-up for newsletters as well as deliver coupons.  Post-purchase, the communication should shift to the customer’s product experience, offering support and ongoing engagement opportunities through social channels like Facebook, Twitter, etc.


The kind of advocacy you see brands seeking on Facebook is distinct from the much larger volume of activity around people sharing thoughts and ideas that aren’t brand-specific. So understand what people are sharing in and around your brand attributes, engage them sooner with brand outreach and be there with your customers as they move from one stage of the customer life-cycle to the next.


Jennifer Hyman is SVP of Marketing at ShareThis, the company that connects audiences to publishers and advertisers through sharing.


Mastering Mobile: Mobile Devices and the Future of Events

Chances are, at this moment, your phone is in your pocket, hand, or sitting on your desk close by.


As our everyday dependence on mobile grows, its impact on the way we interact with people and content grows as well.  When it comes to events and conferences, the smartphone is one of the biggest industry game-changers.  In fact, according to a study by Constant Contact, 81% of small businesses are planning to use mobile technology to market their events in 2013 and 21% of event planners see mobile apps as a top priority investment in 2013.  Mobile technology changes the way we network, the way we interact with speakers and presenters, and the way we plan events as a whole.


Nice to E-Meet You


In this Internet age, our virtual connections are having more and more meaning.  However, the ease of making connections virtually also means that some of our “relationships” are based on clicking a “Request” button, with minimal (if any) true engagement.  Social integration on mobile apps can allow attendees to see who is attending their specific event.  It also gives them a chance to reach out and develop a connection that will ultimately lead to an in-person meeting.


By nature, events like conferences are filled with people of rich professional backgrounds.  Unfortunately, they can also be noisy and full of distractions that interfere with an attendee’s ability to make true, beneficial connections.  Mobile apps at events can allow attendees to easily see the profiles of who else is in attendance, as well as the industry they’re in and possible shared interests or connections.  Apps that use a social sign-in through networks like LinkedIn help event goers match faces with names and titles, and give them the chance to reach out to those with whom they can form a valuable connection.  No need to have your eyes glued to nametags- with networking apps, you can figure out who you need to meet, and then make it happen.


Beyond the Laser Pointer


More efficient networking is not the only benefit mobile can provide at events.  A greater amount of interactivity and depth can be achieved between presenters and event-goers as well.  Presentations are not something to be passively consumed anymore, but can now be live-tweeted, streamed with sidebars of commentary, and filled with simultaneous mobile engagement.  The Digital Age has unlocked information from its physical location, allowing anyone, [almost] anywhere to view and give input about event presentations.


Dedicated event hashtags can be key for allowing event-oriented conversations to occur between present and virtual attendees, alike.  Currently, according to a study, 26% of small businesses organizing events plan on using a dedicated hashtag at their event, and that number continues to grow.  The beauty of the hashtag is that it’s not completely confined to Twitter, either.  Event attendees can use the hashtag with Instagram, Google+, Vine, and most other social networks (Facebook, we’re waiting on you).  When attendees actively use the dedicated hashtag on their mobile devices, conversations surrounding the conference can spread easily and provide organizers with valuable feedback about things from the speakers and venue choice to the decision to have pigs in a blanket as hors d’oeuvres.


Mobile Apps and Beyond


As fancy as our tech and marketing strategies have gotten, the most effective way of promoting your event or product still remains surprisingly simple: Word of Mouth.  What better way to get your WOM on then with a tool that can turn each and every event attendee into an event promoter?


At Social Media Examiner’s Social Media Marketing World, users of the Bizzabo networking app generated over 1.1 Million social media impressions through the app.  Smartphone usage is growing, and more and more event attendees are maintaining a steady presence on social media.  So, when mobile and social are combined, sparks fly.  A few social shares through a smartphone can create great value for event organizers who rely on WOM to increase attendance as well as to create engagement.


Organizers can find further value from mobile that can help the event run smoothly.  Constant Contact’s study states that 49% of event organizers plan on using mobile for registration and payments, as well as 25% who plan on providing a mobile-accessible agenda and event information.


Here at Bizzabo, our goal is to bridge the gap between the virtual and physical world, using the ingenuity of a mobile platform to turn digital connections into real handshakes.


Why Underdogs Are Winning the Mobile App Game


Lately, I’ve heard concerns from a number of entrepreneurial friends in the development community about the influx of big companies into the mobile app space.

Enterprises are naturally clamoring to take advantage of a new multi-billion-dollar market; just as naturally, smaller developers fear that they will be crowded out by much bigger, richer, better-established operations.


Well, here’s a little secret I’ve been sharing with these friends to soothe their nerves when such concerns arise: Independent developers have nothing to worry about. In fact, they may be better positioned to succeed than are the behemoths.


That may seem like a reckless claim. It’s not. App development – unlike … well, almost everything else in our economy – is at its essence a small man’s (or woman’s) game.


Why is that? For starters, there’s a remarkably low bar to entry. Anyone can publish an app, from anywhere on the planet. And apps (at least some of them) can be much less technologically sophisticated than computer software or video games, meaning that a single talented, hard-working developer with a simple but innovative idea has every chance at creating a winning product.


Add to this the fact that the market for new apps still appears nearly insatiable, with plenty of room for fresh offerings, and you might arrive at the conclusion – as I have – that independent developers operate from a position of strength practically unrivaled by their peers in any field.


Sure, the big companies will claim their share. But in an environment that rewards risk-taking, speed, and flexibility, independents have advantages that corporations – which tend to be more bureaucratic and are generally slower to respond to the market – simply can’t match.


For one thing, small developers have more room to experiment, thanks to the absence of shareholders to please and payroll obligations to meet.


For another, when an independent operator comes up with a new idea, that idea merely has to travel from her brain to her fingertips – rather than wending along the circuitous chain of command it would come up against at a big company. In a market as fast moving as mobile app development, this represents no insubstantial advantage.


The attributes that give corporations such a big leg up in other circumstances, meanwhile – namely more money, a bigger workforce, and brand recognition – are greatly diminished in a field that privileges fresh ideas and elegant design over such things as complexity and market reach.


Relieved? Good. Because now that we’ve put some cracks in the myth that independent developers are at a disadvantage in competing with bigger companies, I’m going to share another secret that may seem even less intuitive. Here it is: Far from dreading direct competition from big enterprises, app developers should consider themselves lucky to have a behemoth or two in the market.


Here’s why. In the ever-expanding mobile app space, large companies are like whales that scare up schools of fish for everybody else. In many cases, they don’t take away opportunities from their smaller competitors. Rather, they create new chances for everyone. It follows that small fish that want to get something to eat generally do well to swim in the whales’ wake, rather than seeking out open ocean.


I learned this lesson firsthand when my startup was developing its natural language interface. As we were fine-tuning our app, another company released a similar one. You might know her by the name of Siri. Plenty of people predicted that our little app would be obliterated by Apple’s new offering.


But that’s not what happened. Instead, interest from investors in our venture only increased. Competing with Apple, we got way more to eat than we would have had we been out in the ocean alone. Rather than facing the daunting task of trying to create a market ourselves, we merely had to claim a piece of one that was already pretty sizable – thanks to Siri. Of course, success in app development ultimately depends on a number of factors – not least of which is coming up with a good idea and executing on it. Just because the arena is favorable to small developers doesn’t mean that every developer will succeed. Indeed, most don’t.


Independent developers do, however, have a real shot at thriving in the mobile app ocean. And they’d be foolish to let the big fish scare them away.


Ilya Gelfenbeyn is the CEO of Speaktoit, which develops natural language virtual assistants for Android, iOS, and Windows Phone.