New Work City (NWC) is one of the most important hubs of the NYC technology scene.

Why?  New Work City houses ~50 amazing tech freelancers and entrepreneurs running a dozen or so fledgling startups such as Perpetually, Loosecubes, Urban Pregame, Homingcloud and TouchGraph.  Creating a home for independent workers and early stage entrepreneurs creates the fertile soil needed to seed innovation and birth new companies. NWC is that home. In short, New Work City is a home for the homeless and a desk for the deskless, individuals otherwise relegated to working from coffee shops or trapped in the depressing isolation of their own apartments.

If you’re thinking “desks for rent” you’re missing the bigger picture.  It’s all about the people. NWC is people getting together because working in a stimulating environment surrounded by friendly passionate people who love what they do is f***ing awesome. It’s productive, it’s fun, and it’s deeply satisfying.

On September 1, a mere ten days from today, NWC opens its new home:  a brand new 5,000sq space at Canal St and Broadway. The NEW New Work City will support a larger community and will be amazing. As an independent space, New Work City is self-sustained by paying members of the community — people like me. There’s no sugardaddy bankrolling it and no VC firm backing the space.  It’s run as a break-even business and it’s entirely volunteer run — truly a space for us and by us.

In ten days, the dream for NYC to have a dedicated coworking space will be realized. It’s a dream that initially took shape back in the summer of 2007 as part of an East Village coffee shop (CafeBricolage).  Many of the same people are still at the helms.

Having an awesome home to independent workers and entrepreneurs is crucial to New York City’s goal to become a major technology hub.  However, NWC needs your financial support to make this happen. We need about $100,000 total for the new space, and are attempting to raise $15,000 through Kickstarter.  Please donate to our KickStarter fund and be generous (let’s smash through this goal!)

Also, please seriously consider whether your company or organization could benefit from a partnership/sponsorship opportunity with NWC.  If so, please get in touch with me and I’ll happily put you in touch with “mayor” Tony.

By supporting NWC, you’re supporting NYC as a healthy place for startups.  On behalf of me and all New Work City members, thank you for your support,
Jonathan Wegener

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young entrepreneurs should focus on building B2C companies since they lack the deep industry experience needed to build successful B2B companies.

Allow me to explain my thinking.  Young people in their 20′s trying to start a business-to-business face an uphill battle for several reasons:

1)  Identifying Opportunities is Hard
The best companies are started by people solving their own problems — or so goes the classic logic.  But for young entrepreneurs without any deep industry experience, there aren’t any obvious problem for them to solve.

2) Building the Right Product is Hard
When you haven’t experienced the pain point you’re solving, you don’t truly understand customer needs.   You can try to put yourself in their shoes, listen closely to their problems, and design a solution.  But ultimately, it’s tough to get product-market fit from the position of an outside observer.  A related issue: anytime you’re solving someone else’s problem, staying motivated becomes tough.  Will focusing on the pot of gold at the end of the rainbow sustain the necessary passion to succeed?

3)  Sales, Marketing, and Business Development are Hard
Without industry experience, you won’t have the personal relationships to get your food in the door and close deals and you won’t know the right distribution channels.  You’ll struggle to craft your marketing message in a language that speaks to your customer’s needs.  Furthermore, you won’t have existing relationships with the other players in the industry which could be your partners.

Your Responses

Here’s a few of the fantastic responses I’ve already gotten in response to “entrepreneurs in their 20s should focus on B2C products since they lack any true ‘industry’ experience needed to build B2B products”:

Start With What You Know?

So what do most young B2B entrepreneurs do? Many start with what they know…local! The business on the corner seems like a good place to start.  And of course the market is now flooded with these hyperlocal advertising ideas — “a text message couponing solution for restaurants”  (see my earlier post on that subject).

I can’t think of too many young entrepreneurs that have successfully started B2B ventures.  In fact, the only person that comes to mind is Darren Herman.  Most young entrepreneurs stick to B2C, creating slightly better products to expose undiscovered product opportunities (Tumblr, Box.net Facebook, and Plancast come to mind).  Are there tons of unsexy B2B ventures from young entrepreneurs that have simply flown under the radar?

Your turn: what’s a 20-something to do?

I’m done talking — now it’s your turn.  Any young successful B2B entrepreneurs flying under the radar?  How did you do it?

Investors/VCs — do you find most B2B companies started by someone with deep experience in that industry?  Are there outliers?  How much industry experience is typical.  Weeks?  Years?  Enough to rule out 20-somethings?

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“More expensive and less functional.”

That was the recommendation I had for a friend’s startup. Why? The free version of the company’s product works too damn well.

You’ve probably heard of Freemium. There’s also Previum and a dozen other variations I’m sure. The exact differences aren’t really worth getting into because at the core is this: Something’s gotta break. And someone’s gotta pay to fix it.

But breaking a product is harder than it sounds. Products can break to different degrees and along many different dimensions. Time is one such dimension. With trial software, the user is given a few weeks to use the product.  If they like it, they continue using it. Rdio gave users three days to try it out. Balslamiq gives seven days. Basecamp gives 30 days. As you can see the degree of this breakage varies widely.

Another related dimension is usage in which the product breaks after being used a certain number of times. Or when a certain amount of use is reached. For example, Pandora breaks after 40 hours of usage in a month.

But most products are broken along some feature dimension. AirVideo converted me into a paying user in (a ridiculously fast) five minutes by making the product so broken that it demonstrated that the technology worked and was awesome, but I couldn’t browse all my videos making the product essentially unusable. And sometimes products are entirely broken, which is to say they exist entirely behind a paywall. Many dating websites continue to operate like this.

There’s a dizzying number of  dimensions in which most products can break. It’s limited only by a product’s feature set, a product’s complexity and your creativity. Most products are simultaneously broken along several different dimensions, to varying degrees of breakage, and at different pay points.

Building a product that’s correctly broken requires a strong product sense and a willingness to experiment and charge money. Limit the free version too much and you lose users which could potentially be great sources of word of mouth marketing. Give too much away, and you’re cannibalizing your own products and shooting yourself in the foot. It’s a fine balancing act for sure!

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When a VC friend asked which young NYC startups I find exciting, I sent him a list of pre-funded companies that I’ve been watching. Afterwards I started writing them into a blog post. Well, I should have pressed publish sooner because as the post sat unfinished for the last week, several have since been funded! I’m including them anyway. Good times!

Here’s my short list of NYC startups I’m keeping my eye on:

JumpPost

Apartment hunting is broken.  JumpPost could be the fix.

JumpPost gives apartment hunters ‘first dibs’ on the best apartments. How do they get the best apartments?  JumpPost pays apartment dwellers $500 to add a listing to the site several months ahead of their actual move out date.  Sometimes it pays to plan ahead.

Jordan and his team is onto something big and they’ve already generated some good press (getting paid $500 for doing nothing is especially buzzable!).  I imagine they’ll need some product pivots before JumpPost truly takes off, but this one’s got potential. Personally I would add a social layer to the product and emulate AirBnB which has made finding places to stay fun, easy, and safe.  JumpPost can potentially bring that same user experience to apartment hunting.

SinglePlatform

SinglePlatform gives bars and restaurants a centralized tool to easily update multiple social media profiles: Facebook, Twitter, Yelp, Citysearch, Myspace, and their own website. It’s the same core concept as Postling, except SinglePlatform seems to be executing better.  The founder, Wiley Cerilli, spent the last 10 years running sales at SeamlessWeb so the company clearly understands the market they’re serving — a point that becomes immediately clear browsing their site: “One of the most frequent phone calls to establishments is regarding what games they are playing. SinglePlatform allows you to select which TV packages and team affiliations you have and then posts those games automatically.”

SinglePlatform also seem to be quite good at selling their product at a comfortable price: $450 for a year.  That upfront payment (versus a monthly fee) should help the young company with cash flow issues and also make paying commissioned sales staff easier.  This six month old company seems to be quietly staffing up - LinkedIn already shows 11 employees.  Their aggressive sales force is hitting the pavement hard and closing deals left and right and the product is already being embraced by their customers.  And to top it off, the company is profitable.  This ones gonna be big…

ChallengePost

ChallengePost is a self-described “marketplace for challenges.”  Essentially, ChallengePost is home to dozens of competitions such as NYC’s BigApps which gave $20,000 to developers who built the best mobile apps using NYC datasets. Creative challenges help organizations harness the creativity of the masses to solve tough problems and generate ideas.  It’s a powerful concept that will increasingly become the norm among large organizations struggling to be innovative (also check out Hypios).  Recently, ChallengePost was named the official challenge platform of the US Government.

UPDATE: Sharp-eyed Danny Moon points out that in June 2009, ChallengePost raised an angel round of $500,000.

Kickstarter

Kickstarter is a funding platform for artists, designers, filmmakers, musicians etc. Essentially, it helps people raise funding to accomplish cool things.  Kickstarter handles the headache of accepting donations and also drives eyeballs to your project.  It also imposes some business logic to the process:  like a Groupon deal, buyers (donors) are only charged if the project raises the target amount of money. And fundraisers can associate rewards for different donation tiers (ie T-shirt if you donate $50)

Kickstarter benefitted from the PR buzz stirred up by Diaspora, an attempt by four NYU students to build a private decentralized Facebook.  In Diaspora’s efforts to raise $10,000 on the Kickstarter site, they unintentionally found themselves with $200,000 of donations - effectively an angel round of financing.

Yipit

Yipit makes it easy to find the best deals in your city.  Local daily deals sites like Groupon are hot right now.  But there are literally hundreds of them. Who wants to subscribe to a hundred email newsletters?! Yipit sits above them all, aggregating the fragmented marketplace into a single customized daily deal newsletter with the categories the user wishes to receive.  This puts Yipit in a position to charge a referral/lead-gen fee for each sale it drives to the deal sites. Brilliant.

UPDATE: On June 30, Yipit raised $1.3M.

Other honorable mentions:

-Shoutworthy: A social recommendation system built on Facebook. Think Linkedin’s recommendation tool.  Now imagine a much better version!

-TopGuest: A loyalty reward system built on top of foursquare/gowalla etc.  Formerly known as UDorse.

-Endor.se: A way to find talented freelancers, gauge availability, and built a portfolio of people whose work you endorse.

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The book’s title caught my eye instantly.  ”Visual Literacy”  Intriguing.  I took it home, and over the next few days, I learned just how blind I was to the art of visual communication. Completely illiterate.

The book begins with exercises: “By using four black squares of the same dimension, create a graphic image that best expresses the meanings of each of the following words:

order

increase

bold

congested

tension

playful

I gave it my best shot and then flipped the page, revealing sample answers from students at New York’s School of Visual Arts. Suddenly I realized just how illiterate I was.

I’ve since appreciated design more.  To further explore the importance of graphic design and visual communications, I dug up a few Exit Strategy NYC graphics.  I show our initial design attempts (done by yours truly).  At heart I’m a science/tech geek, so I’ll explain my inherently scientific thought process.  And then I show how a professional designer approached the same problem.

Exit Strategy Fans: enjoy this behind the scenes look!

Train Illustration.  How I approached the problem: Exit Strategy NYC shows subway riders which train door to use.  So each door needs an ‘on’ or ‘off’ state.  The MTA’s trains can be 10 cars, with 4 doors in each car.  That means 40 doors in a train.  We want the train to run vertically on the iPhone screen which is 460px high (it’s 480px minus 20px used by the time/battery/service strip at the top).  So dividing 460px by 40 doors means each door gets about 11px of space to indicate on or off.  With padding, there’s probably 5px of height for each door and 5px in between the doors.

Where I got stuck: 5px for a door isn’t large enough to stand out, even if it’s red and a few extra pixels wide.

How a graphic designer solved it: By making the train have a ‘slant’ to the side which increased the swatch of the door, allowing the red color to ‘pop’.  Also she made it 3D and beautiful.

Splash screen.  How I approached the problem: We wanted to communicate subway transit combined with the notion of exiting quickly. Inspired by an ‘exit’ sign, I attempted to overlay a transit like system on top of it. It’s hideous.

Where I got stuck: Everywhere! How could we possibly communicate something as intangible as “Which is the correct train door?” while keeping a transit theme.  Time to call in an expert.

How a graphic designer solved it: Sheer brilliance.  The zig-zag of the colored lines communicates subway lines.  These lines dump out at a subway door.  The ‘correct’ door is open with a silhouette of a running guy.  An arrow helps indicate that this is the right door. The entire image is done with bright and bold colors.

So if you’re wondering whether you really *need* that graphic designer — always lean towards ‘yes.’  They’ll bring a perspective to the product and the messaging that will pay for itself many times over.

Readers — have any embarrassing early design of your products you wish to share?

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Many of you might have received an email about a birthday party scheduled for tonight.  Hopefully you’re not planning on coming because the party isn’t mine — it’s actually a humorous misunderstanding caused by an overly aggressive planning web service.

Perhaps you’re familiar with Plancast.com – ’foursquare for the future.’  Well, last week I received a facebook invite to my friend Madeline’s birthday party. The event was titled “My Birthday Extravaganza (i.e. Maddy boops is an old lady).”

When I RSVP’d for the event, Plancast scraped the event and added it to my profile.

Then it e-mail blasted this to all of my friends:

And at some point Plancast also announced the event from my twitter account.

Five different friends emailed me to ask about the event. Some were disappointed they weren’t explicitly invited (“no party invite? i’m hurt”)  Other expressed their regrets that they couldn’t make it.  And some were just confused (“I completely got all the way to adding the party to my calendar in outlook, when i finally realized that it wasn’t your birthday party and you’ve never once been called maddy boops or whatever in my hearing”).

This is partially a result of the confusing name of the event.  But it also caused by Plancast’s lack of focus around who actually planned the event.  In fact, on my Plancast profile page it proudly announced “You planned this!”  This isn’t an issue for large scale public events where the host doesn’t matter, but for private events the system is a little bit broken.

Regardless, I’ll be sure to let you all know when I have my own birthday extravaganza!

(P.S.  Did you notice the awesome picture at the top?  They’re binary candlesticks!! “The only birthday candle you’ll ever need. One candle with 7 wicks that you light depending on your age. Works for birthdays 1 through 127.”)

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Wow.  It’s easy to see that the Facebook app usage on the iPhone platform trumps all the others.  From what I’ve gathered talking to other cross-platform mobile developers, these results are generally in line (at least for free applications):  Blackberry generally has half the install base of iPhone, and Android and all the others continue to lag far behind. Let’s look at another free app: Foursquare, which shared their platform breakdown via a tweet.

Android has an impressive showing, which could make sense given the application’s early adoption by techie types. Unlike Facebook, it hasn’t (yet) gained mainstream adoption. The differences across platforms become even more stark when we focus on paid apps. Here’s what the breakdown looks like for Exit Strategy NYC:

So those you have it — a few potential reasons for the differences.  At the end of the day I believe small developers are best advised to put their energy into developing for the Apple platform. Building products for the other platforms probably doesn’t make sense at present time unless you have a game-changing mobile vision for a product that’ll take years to complete and needs the openness that Android provides.  Or if you’re a startup showing traction that relies on a strong network effect to take over the world (ie Foursquare). Or if you’re a big company with tons of cash to build out your branded app — like Facebook, which tries to have versions available for every phone possible!  But gosh, I’d hate to be that engineer locked in a basement building for all six users of the Sony q7d3m1p$9!&9b7u64gph model phone.

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But let’s look at the numbers to make sure we’ve got the basic facts right:  there are more iPhones sold everyday than Android phones. How do I conclude this?  In Google’s Q1 2010 Earnings Call, Jeff Huber reported 60,000 new Android activations per day. Sounds impressive.  But consider that Apple reported 8.75M iPhones sold this past quarter.  A quarter is three months long or ~87 days which means Apple is moving 100,000 iPhones a day.

So Apple continues to sell nearly twice as many phones as Android. Now add in the fact that Apple sold close to 11M iPods too (unclear what % are the iPod Touch, but it’s safe to assume a majority) and it’s clear that Apple continues to be the big winner in terms of mobile OSes. In fact, to date apple has sold 85M iPhones and iPod Touches. Android is nowhere close: even if we generously annualize the current sales figures and add a year, android’s user base would still only be at 21M.

So how the heck did Techcrunch just run a headline reading “AdMob: Android Passes iPhone Web Traffic In U.S.”?

Simple answer: the methodology itself has a major flaw.  AdMob is simply reporting the ad request that runs through their advertising network.  These figures heavily depend on the adoption of Admob’s services — i.e. the relationships they’ve formed with app publishers and websites.  And the adoption of Admob’s services across platforms varies widely.  Also, Android apps are twice as likely as iPhone apps to be free (which generally correlates with ad supported).  So Admob’s ad impressions are simply NOT a good proxy for the overall state of the market.  Especially seeing as Comscore pegs Apple’s share of the smartphone market as 25.4% vs Android’s 9%.

For now the underdog hasn’t won.  They haven’t even come close.  And everyday Apple continues to add more users than Google.  Until that changes, the real usage figures won’t be anywhere near each other.

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As they laid out the extensive feature set they envisioned and the millions of dollars in venture capital they were hoping to raise to build this product, I was struck by an interesting realization: the concept of a Minimal Viable Product (MVP) is actually quite counterintuitive. Don’t you want your product to be as awesome as possible? Features are good, so how could fewer be better?

Manhattan is full of gorgeous skyscrapers. No self-respecting person walks around thinking to themselves “Gosh, if I were going to build a skyscraper, I’d want mine to look like shit.” That just doesn’t happen! Instead, we have a natural tendency to want to ‘one up’ the status quo: “I’m going to build a skyscraper out of gold!”

But in software, version 1.0 of your product should look like shit! Reid Hoffman, founder of LinkedIn famously said: “If you’re not embarrassed by the first version of your product, you’ve launched too late.”

The heart of the issue is that very few of these minimal viable products exist in the real world. Why? They rarely stick around! Customer feedback quickly drives additional improvements and features. Soon, memories of the mediocre original product completely fade away!  How many of us realize that the original iPhone didn’t have apps?! It wasn’t until July 2008, an entire year after the iPhone debuted, that the app store launched.  But today we only see the final product.

In a world of beautiful skyscrapers and impressive technologies, thinking small seems futile. But in this economic environment, a minimal viable product is more than just a nice concept. It’s a requirement.

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apps should allow users to achieve key goals with as few finger taps as possible.

Exit Strategy NYC’s extremely simple interface asks only three key pieces of information:
1) What subway line are you riding? (tap the line’s icon)
2) What subway station are you going to? (tap the station)
3) What is your direction of travel? (tap ‘uptown’ or ‘downtown’)

The app then shows the platform diagram for this station. Three taps — that’s it! In and out in fewer than ten seconds. Compare this to the Tube Exits interface design (Tube Exits is the London equivalent of Exit Strategy NYC.) The user has to tap over a dozen times just to get the same information!

One of my favorite apps, Foursquare, took a step backwards in their latest update. Previously you could check in with two taps: once on the venue, and once on the ‘check-in’ button. Easy Peasy. But the latest update added an additional step after the ‘check in’ button. This change added no functionality, only friction.

If you’ve ever played the Settlers of Catan iPhone app, you’ve seen another worst case scenario. Users must tap a tiny “Continue” button every time the next player’s turn comes up. It’s unnecessary and it’s frustrating.

Using an app with poor tap economy is like trying to run a marathon in the ocean. You exert much more effort and get nowhere fast. There’s too much friction. Tapping is mentally taxing, especially when it lands users on an entirely new screen. The user must review this new screen, then figure out which elements are interactive, then decide which one will help achieve their goal, and then tap again! Each additional screen/tap shoves one more roadblock between the user and their end goal.

The best services let users do more by doing less. This makes users feel powerful. Have you ever used Amazon’s one-click checkout to place an order? If not, please try it. It’s thrilling to use! Similarly, Griffin’s iTalk app features a giant ‘record’ button that feels magical. With a single tap, the user can start recording because the app picks smart defaults and stays out of the way.

The only time having an extra tap makes sense is when the alternative is worse: a cluttered user interface. Good UIs balance which elements are shown and which are hidden. Consider Facebook’s decision to add the grid button in the upper left corner:

Economy [of taps] is always a motivating factor, but the grid adds an extra tap [because you need to press the grid button] versus the full-time tab bar. This was a compromise I felt was necessary. There’s always that balance between screen clutter–adding tabs–and the number of taps.

-Joe Hewitt Quoted in Chris Dannen’s iPhone Design – Award Winning Projects

At the heart of many apps is a single core goal that your users hope to achieve — repeatedly. For Exit Strategy NYC it’s retrieving information. For iTalk it’s recording audio. For Foursquare it’s checking in. For Amazon it’s purchasing items. Don’t make your users run in the ocean. Remove as much friction as possible. Let them fly in the sky! The quicker the user can perform their goal, the better they feel about themselves. And the better your product makes them feel, the more they’ll fall in love.

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