Prices:

Hotdesking, R990 per month
This gives you access to a desk/table, and a chair. Your workspace must be cleared each time you leave the premises.
24/7 access
All facilities included

Dedicated desk, R1,990 per month
As above, except that you get a dedicated desk that is yours, and does not need to be cleared each time you leave the premises.

Private office space
Extremely limited. Charged according to capacity, at R2,100 per person. Private offices are not encouraged.

Daily Rate:
The daily rate is R100, on a hot desking basis, and is made available as space allows.

Facilities
All facilities, including meeting rooms, boardroom, quiet rooms and “phone call” rooms, bar area, kitchens etc are made available to tenants on a fair usage basis, free of charge. Ditto for coffee

Bandwidth
Still trying to negotiate my way around the best way/cost to offer the best bandwidth possible. Ideally I would like it to be included in the above prices, but there are no promises. If it is going to be a separate charge, it will not be more than R200 a person, uncapped, on a fair use policy basis.

Things to know:
1. Zero tolerance for not respecting other people’s space and stuff.
2. One month deposit. A calendar month’s notice. No notice accepted in November/December.
3. Rates are per person, not per desk.
4. No visitors, exept in meeting and boardroom. All other circumstances, visitors must check in and pay daily rate. Each tenant will get 2 free day passes a month to give out to colleagues, though.
5. Prices exclude VAT, which will be charged once we have VAT status (about 3 months from now)
6. All potential tenants, after they have been accepted into the Geekspace, must pass a security check, apply with their ID document, and agree to be fingerprinted on entrance to the space.
7. All potential applicants will be screened for their suitability for the Geekspace ecosystem.
8. Everyone must respect that this is a low-noise environment.
9. All tenants will be required to sign a “Code of Conduct” and a “Paying it Forward” pledge. Both these are to support the ethos of the ecosystem.

Hope this works for everyone.

Remember: if you are a company that earns revenue off the online space (development, consulting, marketing etc) please consider adding yourself to the Directory of SA Web Professionals and Companies. Your supoprt will help support the Geekspace!

Most landlords want 2 or 3 months deposit, first rent, the office needs to be furnished, connected, etc etc.

The Geekspace is no different, and although there is a revenue model, it actually is a heavily subsidized one. R1000 a month, even collectively, would just never pay the rent and operating costs on 600m2.

That’s OK, though, because I have a plan for this (including corporate sponsorships) and I will be sharing shortly. (Also, my own company will be sitting there, so there is rent consolidation that is significant).

Anyway, the point is that the outlay for a fully connected, furnished office is HIGH.

I need a bit of help.

Some of you will know that I have recently launched the “Directory of South Africa Web Professionals and Companies”. (If you click on the link, the download will start). You can read more about it here, but essentially it is a downloadable directory of companies and people that corporates can outsource to get online stuff done.

Each company gets a one page listing, for R1,500 (May special) for the year.

So here is the evil plan: I challenge the 120 companies that are listed for free, and that make money out of this space, to upgrade their listing to a paid one. That will cost them R1,500.

I will then not “pocket” the money, but use it (mostly) towards the Geekspace. It will make things a bit easier for me.

But it’s not about me It’s about the companies who will be supporting the Geekspace, while also promoting themselves through a directory that can get them more business. This year alone I have published .pdfs that have gotten over 12,000 downloads/views…so this is seriously a good business move for any company who outsources web services in South Africa.

So:
100 companies
5 days (Need this finalised before June 1)

Can we do it?

(Ummm, PLEASE can we do it?)

For those of you not familiar with Seedcamp Week, you can read more about it on their site. But in a nutshell, it’s an intensive competition for startups, that happens in September in London. About 20 startups are selected, go through a rigorous presentation program and 5 winning teams are invested in, in return for a 5%-10% equity stake. The investment is between 30-50,000 pounds.

As with most competitions of this type, the real value is in the networking, exposure and mentoring, although the money is not to be sneezed at. There are over 400 mentors, with European connections, in the Seedcamp pool.

Seedcamp also runs mini seedcamps throughout Jan-June so that it can identify hot players to take part in the main event. South Africa is going to host an event like this, and this is a first for Africa. The winner will may get to participate in the main event in September, in London.

Gareth will begin taking applications mid June, and he will soon post more info on the Tech4Africa site. He is looking for 20 startups to participate in the local competition. Mentoring is going to be a huge part of the selection process, and the winner will be announced at the Tech4Africa conference.

I am particularly excited about this, because Crowdfund should have some exciting projects to enter into the competition (although not by mid June). Also, I see a lot of ideas that we cannot fund for various reasons, and it will be super to offer the entrepreneurs a chance of participating in this competition instead. And of course, we might spot some winning gems that don’t get to win, but that *we* can still fund.

Awesome.

(Gareth Knight is on Crowdfund’s board)

Geekspace will be 500m2 devoted to helping entrepreneurs conquer the online space. Most of us are (or know of) coders who sit huddled in their bedroom, separated from the rest of the civil world, and who would really benefit from being a part of an ecosystem that could “feed” everyone in it symbiotically.

I am working out the finer details (including lease negotiations) but all of these are semantics: the Geekspace will be ready to launch July 1, and the space should be available June 1 if you don’t mind working in slight chaos while we set up.

The place I have in mind is in Bryanston, 5 minutes away from William Nicol and thus relatively close to the highway. Plenty, plenty of FREE parking (HUGE issue, trust me…most buildings want from R400 per bay). (But the lease hasn’t been signed, and I have 2 back up locations).

Should you be accepted into the space, you will get a desk, chair, Internet connectivity etc etc. There is a super entertainment area, including a bar (yes!) and loads and loads of built in fun. Also: free use of the boardroom, meeting rooms, etc. Private offices are also available, but very limited. Hoping to get DSTV and TVs in time for World Cup etc. There is a training room, a library, kitchens, etc etc. In other words…. truly AWESOME.

Oh, and the space will be a 24/7 so it will *never close*.

I am looking for a diverse mix of tenants, so it doesn’t all have to be “online people”, but it does have to be people that feed the online ecosystem. So, aside from coders, it can be marketing, strategy, legal, financial etc. Diversity is the key. Yes, also when it comes to colour.

The cost will be kept to the lowest possible. Still finalizing numbers, and dependent on sponsorships etc, but I wouldn’t want to cross the R990 per desk, per month fee. This includes the furniture, parking, facilities etc, but *might* not include bandwidth. You have to bring your own laptop.

Leases are month to month.

If you are starting up a venture, or have been accepted into the Crowdfund programme, you would most likely not incur any cost at all for the first 3 months. Also, if you are busy playing here, but really cannot afford to pay, you should just talk to me. This isn’t so much about revenue as it is about making things happen.

I will post much more details soon (including a dedicated website to this), but I just wanted to get the word out and start gathering some feedback of interest.

If you are interested in renting a desk for about R1,000, please email me directly, asap. First come first served, and space is limited. eved@ideabank.co.za, with GEEKSPACE in subject line, please. I need to know how many desks, who you are and what you do.

So I have been very vocal in the past, with the Crowdfund and beyond, that I am not a fan of copycat sites. I feel that if you are going to spend the time and energy on doing a startup, then you should do something that is going to wow the world and be memorable. Not much memorable about a copycat site.

(Btw, by “copycat” I mean a site that is based on another site, more than likely US based, that you are thinking of launching here in South Africa.)

So at our last Crowdfund board meeting, I brought up the fact that I really wouldn’t be interested in funding any sites like this, even if only because I believe we should focus more on the global space than the South African space. And I was knocked down flat by every board member present.

Everyone pointed out that copycat sites usually bring improvements with them, that are geared towards the local market. Also, South Africa shouldn’t be left out in the cold just because there is an excellent regional model elsewhere that hasn’t made it to our land yet. Etc, etc. So, as I have stated before, we are in fact going to look at investing in a) local sites and b) maybe even copycat sites. But for me the first option will always be innovative, and global.

Anyway, all this talk made me realise that there is indeed logic in the madness….if a good model exists elsewhere, is it really so bad to replicate it here?

I am going to give it a shot, just for the hell of it.

I have been thinking long and hard for a while now about the best way to use the web to score a good deal. Nothing original there, of course. I was simply trying to come up with the optimal way. I even registered a cool domain name (www.dealcatcher.co.za) back in October last year while I was thinking about it.

In the meantime, I have been spending a lot of time researching “what’s big online”, in the US. And the one thing that jumped right out is Groupon.com. It’s gotten a lot of funding, it is cash positive, it has a lot of media attention. It also has a hell of a competition (at least 65 other similar sites) and not that many members, relatively speaking (3.6 million, after abt 3 yrs of operation). Still, I like the model, or at least half of it.

Here is how it works: Groupon finds an awesome deal (a massage at half price) and offers it to its members, conditional on the fact that a minimum of x people accept the deal (say, 75). Once 75 members sign up and pay, the deal is ON. More people can sign up while the deal is live, which is usually for the one day.

(Actually, it’s a bit like the Crowdfund. Without a R million in pledges, the deal would be OFF).

So, guess what? Yep. I’m launching a local Groupon-like site. Will use the www.dealcatcher.co.za domain, and will tweak the model (substantially) to suit our local market.

Of course, now I want it up ASAP. I have put a super team in place to make it happen, so I am giving myself (and them) a tough deadline. Three weeks to beta. I think it’s possible, although there is nothing set in stone.

Here is the kicker though: this is going to be a fun, side project. It certainly won’t use any Crowdfund money (obviously), but it also won’t use much of my own money (there is a team in place to run with this, so it’s not a solo project for me). Let’s see how I can bootstrap this to profitability. I am going to try to be as transparent about the process as makes sense strategically, and I will use this site to blog the process. Ultimately, I am going to put my thesis to the test that it is possible to harness the social cohesiveness of the South African online population to launch a good site cheaply, but well. And it will go one step further to apply the Geekretreat credo of “Making the South African Internet Better”

• We decided on a clear filtering method to deal with the applications for funding. You can read more about that here.
• We decided that we will consider South Africa focussed startups for funding, especially if they have applications for the whole continent. However, first prize is still a product that can launch globally.
• We decided that copycat products are OK. I was the one who was opposed to this, as I would like the Crowdfund money to fund innovation, but a strong case was made for the fact that by copying, the necessary improvements can be brought into play that can make a killer product. (Incidentally, just to be clear: I have no issue with copycat products in general, and will in fact be launching one myself later this week. I would just prefer not to spend Crowdfund money on them).
• We had a long discussion about the whole eco-system created by the Crowdfund, with an emphasis on the co-working space we want to set up. This will be huge. Watch this space.

The application is reviewed by a board member, usually me, who checks it to make sure it “ticks all the boxes”. The Crowdfund looks for projects that meet certain criteria, and it cannot consider projects that do not. (I intend to post in more detail what those criteria are, but in the meantime this is a good start).

At this stage, one of three decisions happens:
1.“No, we are not interested in further discussions.” This means that either we feel that the project is not viable at all, or not viable with respect to the Crowdfund mandate. It does not mean that the idea cannot be successful, cannot make money, is unrealistic (although any or all three of these can apply). It does mean that we are very unlikely to change our mind on the project, unless you make big changes to the idea or the team. You are welcome to enter into a dialogue with me as to why this is so, and we encourage you strongly to submit another idea.

2. “Maybe we could be interested in discussing this further” This means that you have caught our interest, but we need more information before we commit yours and our time to the review process. At this stage we will usually ask you more questions, or have a face to face meeting with you.

3.“Yes, we are definitely interested in discussing this further” This means we are very excited by either your idea or your team. We’ll probably ask more questions, and then based on those, ask you to present to the board.

What to do when we say “No”.

The first thing I suggest is that you ask us “Why?”. The reason I leave it to you to ask, rather than offering more than the broadest of reasons is that I have found that people can get very defensive when their ideas are critiqued, which is a pity.

You might find that we think it is a brilliant idea, just not suited to us at the Crowdfund. Or we might think it is not such a hot idea, because of various other reasons. Either way, if you are convinced that your idea is the killer idea, then you should simply refine, and try again and again and again with other sources of funding. But we’ll cover all that in our one on one discussions.

What I would really implore you do take to heart though, is that although our opinion shouldn’t be the death-toll of your idea, it does probably have some relevance. In other words, if you have gone as far as submitting your idea to us, then go the full distance and learn something from the process (we’ll be learning too). It is quite possible that your idea just is not viable. Question our opinion, but be prepared to abandon your idea and come up with a new one. As I heard over and over at the recent SxSW I attended: If you are going to fail, do it fast.

I think one of a good entrepreneur’s biggest assets is his or hers ability to innovate: it means they can adapt quickly, and are not likely to get boxed in. If you have come up with one idea to submit to the Crowdfund, I bet you can come up with 10 more before the week is out.

And we might just love one of those

Filtering by gut

When I see and read an application for funding, it usually takes no more than 30 seconds for me to get a gut feel for it. This is different form the “first 15 seconds to make a good impression” though, because I really do believe that the gut feel is not influenced by anything other than the raw idea itself. In other words, it would make no difference if you present it more eloquently, or with broken grammar, or if you cut and paste it into an email rather than have a professional .pdf designed.

A good idea screams from the rooftops, no matter how it is presented.

So what makes this idea so good? Well, thousands of blog posts have been written about this, and the discussion is far from over. Here is what I believe:

The idea has to be simple. Like, really, really simple. Your mother and her mother should understand it if you were to explain it to them. They should also be able to use it, once your prototype is ready. (I am not saying that they have to have a need for it, though. They must just understand it). When looking at some of the applications,I don’t understand the idea. And that’s a big problem.

The idea needs to give a clear solution to a clear problem. I need to see immediately who would use this and why. It doesn’t have to be 10% of the Chinese population, but it does need to be a market I can visualise, or imagine. People who are active online are busy people, and there are a lot of products vying for their attention. I am looking for that compelling “something” that will make these people choose to give time to your product, rather than a different, even unrelated, one.

The idea needs to be executable. This is a bit tricky to explain. I need to see the logic of how the product will be coded, even if I am not able to code it myself. For instance, if you are looking to develop a product that lists the top ten sellers in the e-commerce world over the last hour (look, an idea!) I would need to know that you can get access to the API of the leading e-commerce platforms. I can actually see this as very possible. However, if you want to create a product that creates groups of Twitter people based on their location so you can target them with email marketing, I don’t see how you would get access to their email addresses, because I know Twitter won’t give them to you. (This isn’t a deal breaker though, because if I don’t see it, I will simply ask you. But if you don’t see it either, then we have a problem).

The idea must be able to launch small. Funding the first fax machine would not have been first prize. Funding the millionth fax machine because it was so much cooler/better than any that existed already, and that everyone would have wanted instead, would be better. If you need a million users before the value of the product is realized, that could be a too big of a hurdle to overcome.

On the other hand, the idea must be able to scale fast. We expect you to be successful beyond our wildest dreams. So I would like to see that that is very possible.

The idea must have some whiff of revenue potential. It doesn’t have to be carved in stone, but I would like to get whacks of inspiration for how this could make money.

And of course, the team. The team must be made up of people that the board would really want to work with: smart, passionate, driven, social.

Chris Dixon points out in a post that if you are relying on advertisers for revenue, you actually need your website visitors to leave your site. So you shouldn’t be too sticky.

He cites Google vs Facebook as an example. Google is obviously designed to get you as fast away from it as possible….they want you clicking on those advertisers, the more often the better. They know you’ll come back of your own free will. Facebook, on the other hand, is very different. It wants you to stay there, and therefore does not offer much hope for advertisers who are waiting for you to click, click click.

Which goes a long way to explain why Google’s revenue is 30x that of Facebook’s.

As Chris says:

Facebook is like a Starbucks where everyone hangs out for hours but almost never buys anything.

This only applies to ads that want to be clicked. Maybe ads should simply want to be viewed? For brand building, for instance. (Chris refers to this as “intent generating advertising” as opposed to “harvest generating advertising). He suggest the big brands will have to rethink their approach.

They would be smart to look at our local Daily Maverick, which has done the thinking for them. The advertising model there is clearly built for brand awareness, rather than a “click now!” mentality. Which is great for the Daily Maverick, because it can then be as sticky as it wants to be.

Arrington raises the issue that certain startup companies have extremely high valuations as dictated by the latest investments rounds: Foursquare ($80 million), Quoara ($86 million), Blippy ($38 million). None of these have shown any substantial revenues, never mind profits, and there is no clear exit strategy for the investors. So what is going on?

Marc Andreessen (founder of Netscape, Ning and now Andreessen Horowitz, a $300 m venture fund) had some good insight. He points out that every year there is a very small number of companies that have the potential to be “incredibly important companies”, and that those are the companies that “have the potential to be very financially successful, and … important and financially successful in this industry turns out be the same thing“.

He goes on to say that:

• Every year, in the long run, the tech industry creates about 15 companies that end up doing $100 million+ in annual revenue
• These are the “important franchise” companies like Google, Facebook, Salesforce
• These companies are “the main event”
• These companies are in demand by the VCs
• These companies merit the high prices, assuming they work.

David Hornik, from August Capital, points out that

“ultimately…you can talk yourself into pretty much any valuation because at the end of the day if it’s the multi-billion dollar outcome, then having done it, you know, done around it a hundred million pre- is sort of irrelevant. The difference between 50 million and a hundred if it’s the same multi-billion dollar company is nonexistent. The only problem is, do you get it right?…..We all seem to agree on what the things are that might be those interesting deals and that’s driving up the price.”

So basically, what it boils down to is: the VCs are willing to pay a premium for companies that they believe will make it big. Question is, are they targetting the right companies? As is pointed out in the video, there are plenty of startups, with excellent technologies and business models, that for some reason have not been able to get the “hype” and are therefore not perceived as “big” or “important”. And these companies can be acquired for a fourth of the “important companies” price.

Is Blippy an “important company”? I will say a clear and loud “No”. (Blippy allows users to post details of everything they purchase, as in “I just spend $356 at Amazon!”. Theory is that advertisers will be able to see who is buying what, and target them with precision. I’m not too convinced). Yet it has received a second round of financing, and is valued at $38 million.

The VCs seem to be paying a high price for good PR campaigns. Is that a bad thing? No. Perceived succeess often leads to real success, so paying a premium for hype might well be worth it.

Lesson to be learnt? It’s not, after all, all about the technology. You need traction, PR, consumer love. Get that right, and you might just be onto something big.

I have a lot of respect for Wilson, and I think his blog should be a regular read for those who are interested in conquering the online space. You can view his talk below, or you can read the full transcript here.

If you don’t have 30 minutes to watch the video, or to read the transcript, I have summarized the key points below:

The 10 Golden Principles of Successful Web Apps from Carsonified on Vimeo.

1. Speed: if the app is slow, or if it becomes slow, people will stop using it.
2. Instant Utility: if the app requires a lot of work to configure before it is useable, the uptake won’t be fast or great
3. Software is media: and just like media has a voice (Vogue vs Vanity Fair), so should your app. Personality is important.
4. Less is more: do few things, and do them well.
5. Make it programmable: Include a read/write API so others can build onto what you are doing
6. Make it personal: let people personalise your app, let them take ownership of it. let them believe it really i theirs.
7. RESTful: this is a “technical” term. Basically, make sure that eery service your app offers has a unique, easy to understand URL that can be shared.
8. Discoverability: Be easy to find by Google, and be easy to be shared via social media.
9. Clean: Don’t clutter. Be clear.
10. Be playful.