start.up

the internet of things middleware battle

noreply@blogger.com (hannes a. schwetz) — Thu, 20 Dec 2012 10:36:00 +0000

after having mastered the social graph (aka facebook) and the knowledge graph (aka google knowledge graph), it is now the time to tackle the "physical graph", also known as the "internet of things" (IoT). this was the mantra of the 2012 paris edition of leweb. and while more and more consumer products appear, behind the curtains, the "battle of the middleware" just started.

while the concept of IoT is around since 1999, only now smart consumer products appear. be it clever thermostats (nest), emotional email writing interfaces (muse), seemingly intelligent connected toys (ubooly) or the omnipresent activity monitors (fitbit, fuel). and they are just the beginning of a wave, which should reach it´s full extend in 10 years according to tony fadell, founder of nest.

there is something, which lies under the surface of those equally interesting tools and toys though. how do all those physicals devices get connected and how are the data managed in a meaningful way for the user? when exploring this, one discovers a "battle of the middlewares".

whatever new trend the it-sector is running after there is one common phenomena to be observed - and IoT is no exception to this. everyone like´s to be "the one" in the middle - the one to rule them all. thus not only enabling a multitude of services with reduced implementation time but also harvesting through system lock-in in the long run.

at leweb alone three middleware solutions for IoT were introduced. smarthings, an ambitious kickstarter project trying to cover the whole stack, from development platform to dedicated hardware. sense, from the founder of the wonderful but not so profitable nabaztag, more focusing on the data integration side. and finally ninja blocks, a startup looking more at the hardware side with a open source approach.

but that´s not all yet. there are more folks on the battleground than those three:

on the european level, the internet of things initiative and the open source solution for the internet of things in the cloud try to set the general framework for the connected world of things. then there is the early IoT middleware project hydra and if that would not be enough, there are another nine contex-aware middleware systems at hand.

and if the middleware multiverse would not be enough, big corporates like ibm enter the battle and throw the messaging queuing telemetry transport protocol "MQTT", the equivalent of the http protocol for objects, into the game.

so what todo with all that?

well, when setting of to tackle a physical graph project, one might consider the following three things. first, lookout if there is a softwarestack already existing that allows a faster implementation time of one´s own project.

second, all those projects are a actually a "map" where to find the right talent to implement one´s own project.

third and finally given the time frame until mass adoption for IoT products, financial investments to create real physical goods, the additional costs & time for pivoting requires even more focusing on the minimal viable product in combination with alternative investment approaches like crowdfunding. but that´s another topic to be covered.

seven reflections on starting lean

noreply@blogger.com (hannes a. schwetz) — Thu, 31 May 2012 20:17:00 +0000

in the recent “lean startup vie #3” meetup at the sektor5 coworking space in vienna, andreas klinger from lookk summarized his startup experiences so far. let´s go along his seven reflections on starting lean.

1) go a small as possible with your product

2) launch several ideas at once

3) code as late as possible

4) care less about fund-raising

5) get two mentors

6) don´t take public money

7) choose team on gut feeling & check regularly

in hindsight, their original startup idea, the austrian startup formerly known as gamrz, could have been broken down to six startups by itself. there is a simple check, if a startup concept is too complex: if there is an “and” in the explanation what a startup does, it´s too complex.

while rigorous a/b testing for internet startups websites is an imperative, testing different ideas or products in the same metric driven way isn´t. there is no need to actually have the different products ready to ship. it´s just about offering mock-ups through the web and analyse the customer’s reaction.

nothing to be explained about that. although the most tempting thing for technical founders, as that´s where their comfort zone lays.

venture capitalists do not care about startups. they want to invest as cheap as possible, as late as possible. good venture capitalists look only for market traction in their investment selection.

if entering into a new space with a startup, get two mentors from exactly this sectors. pay with convertible notes.

“they are the worst”, stated andreas strong-minded. state funds are designed for classical small & medium sized enterprises. that is a too tight constraint for lean startups, which will change directions very fast in the early phase.

trust in the “gut” feeling in selecting team members. writing down the thoughts about the newbie and checking those notes every two weeks to see how she progresses helps to structure.

startupweek2011: the four winners

noreply@blogger.com (hannes a. schwetz) — Mon, 10 Oct 2011 07:03:00 +0000

the startupweek 2011 - a new startup conference including a startup competition held in vienna - had four winners: the conference hosts, the startup region vienna, mysugr & mysugr. and this is why.

for the first time ever a significant startup-conference was organized this very week (3. - 7. oct. 2011) in vienna. besides the startup competitions at leweb and europas the startupweek left a serious mark in the european internet startup scene.

empowered by the success of their startuplive events, the conference organizer STARTeurope , supported by initial factor, mixed four ingredients for their success. their very own entrepreneurial spirit, the professional network of inital factor with the announcement of their new fund speedinvest & the involvement of techcrunchUK, aka mike butcher (find his coverage here).

being overbooked with max. 1.300 paritcipants allowed, including 100 speakers, 500 startup applications with 50 invited startups from all over europe, STARTeurope delivered a professional managed conference. the cross over of the monarchy style location with the future of european internet startups just added to the success.

while vienna is recognized for the quality of living, it does not have the label as being a startup city - like london, paris or berlin. quite to the contrary, there are some austrian startups which stated in private discussions, that they should have started their business directly in london and not in vienna/austria. one main reason being the lack of venture capital funding.

luckily for the growing vienna startup scene, speedinvest offeres now a initial funding source. one must not overlook though, that follow up investments will still require the startups to look abroad. with only one local private early-stage investor, startups in vienna do face a local monopoly. thanks to the mobility of new startups like egoarchive, which recently moved to copenhagen, this can be only considered as a problem for those not willing to follow the money.

therefore combining quality of living, a growing ecosystems of startups with new funding possibilites, vienna just upgraded itself in the european startup landscape.

and then there is mysugr. their startup idea born out of their own personal experience with diabetes, the founders frank westermann and fredrik debong (also co-founder of STARTeurope) won the hearts and the wits of the jury and the audience.

mysugr makes logging the daily diet easy and provides help for the diabetic on how to manage his daily nutrition with the help of their mobile app. unlike competitors like "on track diabetes" the app and the services around are a "medical device" grade. mysugr is in alpha mode, but take applications here. see also a video where fredrik explains what mysugr does here.

so why is mysugr a two time winner?

not because they won both prices (€30.000, 3 weeks in silicon valley) of the startup competition. not because the rocked the audience to standing ovations including a champaign shower for mike butcher - the outstanding host of the startup competition finale.

but (one) because the showed that it is worth to bring one´s very own startup idea to live and fight it through. and (secondly) for the exposure they generated by inspiring the audience & the jury at the pitching competition. this will turbo-boost them in their next steps towards customers, investors and industry cooperations.

while the future of mysugr looks promising many challenges lay ahead of them. the same holds for the startupweek2012, as the organizers set their own bars high. being a startup by themselves, that will however only encourage them to make it even better in 2012.

how to finance your (startup) dream

noreply@blogger.com (hannes a. schwetz) — Sat, 20 Nov 2010 09:00:00 +0000

ideas on how to finance your startup dreams, proposed at the barcamp vienna 2010.

how to finance your (startup) dream

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"rutschgefahr!" founders terms in german venture capital contracts

noreply@blogger.com (hannes a. schwetz) — Tue, 17 Aug 2010 05:00:00 +0000

multiple liquidation preferences, full ratchets and founders warranties are on the rise on the german startup market. the positions for founders and new investors in new financing rounds get worse in 2010, as a bearish venture capital (vc) market dictates tougher conditions.

in order to avoid "rutschgefahr", german for slip hazard, when negotiating an investment round, read on to get the facts right.

a recent study of the german "mlawgroup" on "vc deal terms report 2010" (german only) gives quantitative insights into an often less transparent market. take the waring, plenty of numbers coming up - plenty of facts to get the own expectations right.

the study is based on feedback on 30 seed fundings, 36 series a and 16 series b rounds. the german "high tech gründerfonds" was taking the lead with 27 investments of 66 early rounds, thus making it the first address for young german startups.

so what to expect as a founder team, when sitting down with investors?

founder vesting is dominant, in 73% of the seed investments. vesting periods are between two to four years. allowances on the vesting are the minority with just 40% of the deals for only 25% of the founders shares.

good leaver/bad leaver clauses gain 18%, up from 32 to 50% of the investments. most good leavers can expect to gain a fair valuation of their shares (73%, up from 49%) though.
venture capitals seek for preferential rights in 78% of their investments. simple (1x) liquidation preferences are seemingly unavoidable in the seed stage (73%), while multiple preferences (2x) are a minority with only 7%. 20 percent of the feedback forms contained no answer on that question though.

exit preferences are common (53%) with an average of 5% interest p.a. on capital invested (8% last year) , although a maximum of 20% was reported.

while founders warranties remain an imperative (95%), pay to play seems to become a scare species. no seed round saw such rulings, series a rounds just in 23% of the cases.
non compete clauses for founders are enforced in 100% of the seed and in 75% of the a rounds with average durations of 2 years. on average founders get a half year salary in return.

anti dilution provisions are either weighted averages (51%) or full ratchets (35%), with a clear rise in the latter.

mlawgroups commented the tightening of conditions for founders as questionable. they could not understand how the worsening positions of the founders could help to prepare the founders (and existing investors) well for exits. for a law firm, this is a rather strong statement.

so much on the numbers. good thing with the study is, that it provides a useful basis to get one own´s negotiation aims right.

read more on general terms & conditions of vc contracts in "legal gibberish of investors in plain english" and in the series "six steps to venture capital".

"get a free portrait!" & more practical guerilla marketing examples

noreply@blogger.com (hannes a. schwetz) — Mon, 21 Jun 2010 07:51:00 +0000

marketing budgets are a scare resource for every startup. finding innovative ways to reach more customers with less money therefore is key. "guerilla marketing", a concept introduced by conrad levinson in 1985 can be one answer.

wikipedia describles guerilla marketing as "...an unconventional system of promotions that relies on time, energy and imagination rather than a big marketing budget." so much about the theory, but how to put that in practice? let´s have a look at three recent examples.

the first one is from the last barcamp vienna 2010 (thanks to the organizers rolf & max and the sponsors by the way!). when everyone was invited to post their proposed sessions, young photographer christian lendl put up the following "portrait photo for a link for a link" to his homepage.

by spending one hour of his time, he reached around 60 barcampers, almost a third of the attendants. now for marketers, that is a extremely good conversion rate! 60 people remember his name and will put links on their blogs, so his own website will rise in the search rankings, without one euro spend on adwords.

what about riding on the hype wave of someone else, to gain customer attention?
in this case it was the company ifixyouri using the apple ipone 4 hype to demonstrate their dedication towards their business: repairing iphones. the upcoming ihpone is supposed to use a 30 times more flexible front cover then used in the iphone 3gs and should therefore be less prone to breaking. at their company blog they published a post "iphone 4 glass - will it break?" to check that out. so they took a new iphone 4 an threw it on the floor. the glass broke at the third try.
disproving the impression the one could get from apple´s presentation, that the new glass would be much more durable, brought them plenty of attention. cost? approximately 30-40 us$ (they sell the iphoen 4 glass repair for 69 us$, so their actual costs will be much lower).

considering the ranking on techmeme and the respective discussion following, that was much more attention time then they would get for 40 us$ worth of printing standard marketing folders. p.s. that they maybe got inspired by "will it blend" does not make this guerilla marketing any less effective.

let´s move on to a third example, graffiti style guerilla marketing. regardless if one considers graffiti as art or daub, they are everywhere and the are a provocative in every way. using graffiti in the public space form marketing purposes remains illegal though(at least here in austria).
although sometimes graffiti are used without raising too much attention of the city authorities, this example of using graffiti style advertisement of telering, a local austrian mobile phone network operator, did not go unnoticed.
as telering was not allowed to spray the advertising message all over vienna the just thought different. why spraying colour on those walls which is forbidden when you can clean the walls - which is perfectly legal? so they did some selective cleaning, whileprotecting a dirty brick wall by a stencil. and that was the result:

again, the cost of the idea and "cleaning" their message on the walls showed true guerilla spirit and was in perfect relation to the attention gained.
that were three examples of great creative approaches to marketing. so what´s the guerilla marketing campaign for your start.up?
p.s. if the guerilla style sounds interesting, why not checking out another idea of conrad levinson´s book "guerilla marketing": "5 words to describe your business".

interview with thomas r. koll about his photostre.am project

noreply@blogger.com (hannes a. schwetz) — Mon, 07 Jun 2010 05:00:00 +0000

photostre.am is a portfolio service for photographers using flickr. recently i had the opportunity to interview the creator of photostre.am, thomas r. koll.

every photographer wanting to present her photo work without using technical skills while remaining on flickr at the same time is in the target audience. no double uploading necessary.

photostre.am is jumping right into a crowded market. competing with hosting one´s own website, using widely available templates, specialised services for photographers or with services form fluidr, viewbook, pullfolio, deviantart or alternative approaches like flickroom, using adobe air.

at the barcamp 2010 in vienna, i had the opportunity to sit together with thomas for a founders interview about his motivations behind the project. (photo by thomas r. koll, view his photostre.am here)

start.up: thomas, what´s motivating you to work on photostre.am?
thomas: to learn, that´s my top motivation. and the pleasure to interact with users of photostre.am.

start.up: what are the most difficult things working on photostre.am?
thomas: photostre.am is taking a lot of time and therefore competing with the "bread" jobs i have to do in order to make a living. being a one-man show, it is furthermore tricky to cover areas like interface design, which is an art by itself. finally to prioritize features is always a challenge.

start.up: how will you make money with your service?
thomas: through pro accounts and a white label b2b service. pro accounts will cost between 10 to 300 euros, depending on the features. compared with creating one´s own portfolio websites, that is rather valuable.

start.up: what would you recommend new startups, considering that you are already work on this project for around one and a half year?
thomas: first, make your to-do lists and prioritize in order to focus. secondly, choose your "bread" jobs - which finance your startup project - based on how much money you can earn on them.

start.up: finally, what´s the technical background, behind photostre.am?
thomas: i am using rails3, mongo db - which has nice horizontal scaling, two virtual servers - one for the app, one for the database and rackspace cloud.

start.up: thomas, thank you for the interview.

private vs. comany live and more, interview with flimmit, part 2

noreply@blogger.com (hannes a. schwetz) — Thu, 13 May 2010 10:00:00 +0000

this is part 2 of the interview with the austrian film search and download portal flimmit. if you missed part 1, it´s worth checking out. read on how setting up a company affects the private life of founders and what the flimmit founders karin, walter and ulrich would recommend to founders of new startups.

how to handle private life vs. work?  
work is private life and private life is work for a start. there is no real private life when realising your dream. the business is with you at all times, after the office, in the evening, at night, during sport, when seeing the family – always. our secret is not to see it as a burden but as a thing one loves to do.

see an animation from the beginning of flimmit:

what does pitching mean for your company? 
pitching is a chance to move on. it is the thing to get the message across. karin haager: “i hated it in the beginning, but i really love doing it now. it demands constant practice, practice, practice - the more the better. the most difficult for me was to do a pitch for training reasons in front of my own company colleagues, but it’s one of the best ways to get settled for the real thing.”

you have already left some tracks in your personal careers, e.g. karin and ulrich, you have been film producers for six years, working on 20 projects. walter is a helicopter pilot. now you are start.up founders. what`s next?
  we have a bucket list of things we still want to realise in our lives. however, now it’s all about movies! and we are aiming to keep it that way for a while.

how do you handle working with those „big“ film industry guys which try to stay in business by suing their customers?  
no fear from the “big guys”. if you got something good, take a chance. and flimmit’s offer is a good alternative and a chance even for the “big guys”. plus we don’t criminalise our customers.

  what are the three most important things to gain visitors on your site? 
billy wilder once said: “a good movie needs three things: a good book, a good book and a good book.” the thing flimmit needs is permanent seo, seo and seo (editors note: search engine optimization). on top of that strategic cooperations with websites and word of mouth and our site gets rolling.

  anything else you would like to talk recommend new start.ups for the beginning? 
gang on in there and believe in your dreams. find good friends that you can work with. and always keep your eyes and ears open and take other people’s advice. finally react quickly (editors note to market and costomer feedback) and just do it!  

interview with flimmit - the austrian film search and download startup

noreply@blogger.com (hannes a. schwetz) — Sun, 02 May 2010 10:25:00 +0000

legal film downloads in europe are a mess. therefore film search is broken too. the austrian startup flimmit is out to fix that. not having one legal framework like in the u.s., the european "rights" marked for film is hyperfragmented. first steps for a common legal framework are only in their beginnings. therefore just to google a film one wants to watch is nearly pointless. because finding the film of choice on a u.k. video download portal will lead to nowhere, as they will not have the distribution rights for austria.

find another search example in the demo video from flimmit:

flimmit searches and finds, lets mention "legal" again, content. so does it work? searching for "lord of the rings" there is a full-size feedback. download and buying possibilities, best prices, reviews, trailers and more. same goes for more recent productions, like avatar. just the recommendations leave room for improvement.

what drives the three founders of flimmit, karin haager (cfo), walter huber (cto) and ulrich müller-uri (ceo) to fix the broken film search and download business? (founders photos © flimmit 2009, photographs by lisi navajas)

i tried to find that out in a recent interview with them. as with the interviews with andraz tori from zemanta or christoper clay from soup, it is split up in two parts. read on the find out more on the startup in this part 1, on how to gain traffic and more in the upcoming part 2. so lets jump right into the interview:

tell me about the (three) most exiting things about starting up your company? 
starting a new business is all about making your own ideas come to life. an innovation that first pops up in your head and then materialises into ones own company is a great for oneself and the self esteem. to inspire people with your idea and see the results when finally the thing gets going is important as well.    

what about the (three) most unfortunate things about starting up?   
constant worries about financing and a possible lack of money are tough on the way to success. that leads to sleepless nights. what really got us up in sheer shock was the up and then arising fear that the innovation we have brought to the market is not unique anymore – that someone else has just done the same thing.
 
what are your lessons learned until now about tech/people/market/sales (choose what you prefer)?  
people: it takes ages to find the right people to work with and it is a tough task to have them stay with you, above all due to lack of funds in the start up phase.
market: we have learned that customers / users never do anything because of good will. they want a benefit when using your product or service.
sales: the most important lesson learned for us: never trust sales forecasts!
 
when you hear the words "exit" and "shut down", what comes to your mind?  
the term “exit” mostly appears in a conversation with possible financers. we do not yet think about an “exit” so far but we can talk about that in a few years time.
shut down means disaster, a sheer horror scenario. on the other hand when founding your own business you always have to calculate with a possible shut down. but isn’t that the essence of a start up: to always have the motivation to go that one step further?

to find out how the founders handle private vs. company life and more, read on in the upcoming part 2 of the interview.

inside tupalo, a photographic snapshot

noreply@blogger.com (hannes a. schwetz) — Thu, 25 Feb 2010 19:01:00 +0000

all one regularly "sees" of a web start.up is , well, their web site. recently i got the opportunity to find out how it actually looks behind the scenes at the vienna based austrian-american startup tupalo, a social yellow pages community.

working together with the tupalo -team for an afternoon, we produced a photo line up for "deutsche-startups.de". to read more, head over to the tupalo blog.

tupalo won a first round investment from the austrian incubator i5invest. they subsequently reached an investment and a strategic partnership from herold business data.

estc2009 & leweb: do startup competitions bring visibility?

noreply@blogger.com (hannes a. schwetz) — Sun, 24 Jan 2010 13:10:00 +0000

what do have collibra, flimmit & gnowsis and stribe, tigerlily & cloudsplit have in common? they are all young startups. they all hard won prices at two recent international startups competitions. and they need to be seen by potential customers & investors.

startups face many challenges, one of them is visibility. a way to address challenge, is to compete at startup competitions, like at estc and le web.

the third european semantic technology conference (estc) startup competition had 16 invited startups from 12 countries competing. at seven minutes per pitch only the well prepared teams

could bring their message across. many forgot to talks about how to make money though - or did at least not have the courage to present a „freemium“ model. see here for the video coverage.

at le web, being more internet-minded, the 16 startups as a majority looked to earn money with premium services, based on users gained by free basic services.

as business angels and venture capital money is currently scare in europe and probaply will be for 2010, sticking out of the crowd and gaining attention is a key. so how did the winners perform?

stribe already competed before. making it into the techcrunch50 in 2009 was the first attempt. leweb was the next, this time finishing in 1st place.

but does it really bring attention? does winning competitions bring the wanted visibility? gaeol delalleu, cto of stribes, thinks so. at leweb, he was approached by five venture capitalists.

looking at a streamgraph of the corresponding twitter activity, visibility seemed to get a strong push around leweb as well.

the profile of stribes is in the twitterworld strongly associated related with leweb is obviously strongly correlated with the startup competition.

illustrations thanks to http://www.neoformix.com.

collibra took a different approach to get visible on the fist hand. they made it into a price waterhouse coopers report and won the scientipole initiative award before gaining the first place at estc. if they got approached by vc is not know until they will start to leverage the prize when they start pitching for money in the next year. to know more on collibra listen to this interview.

based on the shere size differential (1:10) between estc and leweb as well as the fact that the semantic world is just about (!) to discover the use of tools like twitter, the results are less meaningful and the streamgraph did not reveal the option to change the timeframe according to the event.

a smaller, more focused event like the estc can significantly boost visibility, as investors attending the estc are already focused on semantic technologies.

what both, stribe and collbra, have in common is, that they have no immediate need for investment. however both are powering up for next rounds in 2010. the visibility is already gained.

five things for startups to expect from mentors & the other way round

noreply@blogger.com (hannes a. schwetz) — Mon, 16 Nov 2009 13:20:00 +0000

the estc2009 innovation seed camp will introduce mentoring sessions for the pitching startups. the diverse spectrum of mentors present at estc covers founders, investors & the industry - laying the ground for interesting feedback sessions. so what can startups expect from those mentors? and the other way round, what do the mentors expect from startups?

let´s break it down into two sets of five :

5 things startups can expect from mentors
1) critical questions - no answers, no solutions.
2) instant feedback on how each and every startup gets its story across. if the pitch is bad, it will be made obvious instantly. that´s a good thing.
3) the impression a startup has on a mentor will be based 95% on pitch, 5% on executive summary et. al.
4) mentors have contacts (businesses, investors, lawyers,...) and some will help you with them - if they value the startup. if not, not more then polite friendliness can be expected.
5) not every mentor will be interesting for every project (and the other way round). that´s ok.

and now, let´s flip sides:

5 things mentors expect form startups
1) passionate, enthusiastic open entrepreneurs are welcome. self centered show-offs looking for adulation will not feel served well.
2) feedback can be direct & rather blunt - better from mentors then your customers, investors or potential employees. so startups must not be offended but take the feedback as is its & do with it what they think is best for them.
3) mentors will want to get ideas on what´s happening in the markets. some will search for investment.
4) mentors invest their energy for prepared teams. startups using the "next best" slide set available, preferring the check their tweets et al. rather then to get the most out of the sessions will receive what they seed.
5) and finally, mentors look forward to critical, even controversial discussions not yea-sayers. so let´s give them a good time!

for more on mentors see also the intersting interview of dave mcclure by mike butcher of techcrunch europe. for an overview of pitching opportunities head over to the finance mindmap. finally, to refresh the memories, find enclosed the start.upICT blog intro on start.up competitions.

startup competitions

View more documents from hannes.a.schwetz.

good relations, twitter & co. dexa 2/2

noreply@blogger.com (hannes a. schwetz) — Wed, 30 Sep 2009 05:00:00 +0000

good relations, a semantic e-commerce ontology was another highlight of dexa. for part one of the coverage, see here. martin hepp, bundeswehr university germany pinpointed to the lack of semantic description of products offered online. this makes search, not only in the long tail, inefficient for sellers and buyers. with good relations he offers a open source basis to tackle this. best.buy and yahoo already use good relations to make their product easier to find. enthusiastically martin hepp was evangelizing for good relations.

Product Variety, Consumer Preferences, and Web Technology: Can the Web of Data Reduce Price Competition and Increase Customer Satisfaction?

View more documents from mhepp.

in contrast to most of the presenting scientists he focuses on an industry ready product approach. uptake of usage will be interesting to follow.

there have been many other interesting talks, like perspectives of web services intermediaries of urlich scholten et. al or fraud detection by human agents of daniel schwabe.

surprising was the lack of twitter and slideshare. only two other twitterers seemed to be posting. only one presentation can be found online. there is still a way to catch up with non-academic life by those which explore the future.

frogs, elections and e-commerce recommender systems. dexa part 1/2

noreply@blogger.com (hannes a. schwetz) — Mon, 21 Sep 2009 05:00:00 +0000

the 10th edition of the international conference on database expert systems & applications, DEXA 2009, brought four packed days with scientific tracks. though seemingly a tough topic to handle, not everyone can jump on the bandwagon of hardcore tech tracks like „evolution of query optimizations methods...“ for data grid systems of abdelkader hameurlain and the like. so let´s focus more on generic topics and start with the „frogs“.

if one would put a frog in hot water, he´d probably try to jump out. if put in a pot of cold water heated steadily he wouldn´t. although not advised to try that, alessandro acquisti from carnegie mellon university (usa) used this baseline to show recent research on privacy behaviour in the internet.
working in the field of behavioural economics, he tried to find out how the arrangement of questions in surveys would influence the willingness of participants to reveal quite private information. like if people did betray an insurance or tax authorities. following the frog analogy (and thus one common design principle of survey design) people should be more willing to reveal sensitive information about themselves if the questions would steadily get more „private“. acquisti rejected this idea. so here we go, if you want sensitive information from your customers, get to the core right from the beginning.

e-commerce recommender systems have also been proven to be a hugely popular research topic. edith elking from the nanyang technology university in singapore brought up a worthy connection between elections and recommendation system.
recommendation systems have the aim to provide (internet) users with proposals, best fitting to their individual preferences. by an „magic“ accumulation of crowd, social, personal,... data every user should be served with her personal best recommendation. this is a difficult task on many dimensions, like context interpretation or manipulation hardness.

for the latter, most technical scientists try to invent new „bulletproof“ recommendation systems from the scratch. on the other hand have scientists since the french revolution thought about voting systems which should find the best candidate for millions of voters, making manipulations hard, easy to use and to compute.
as arrow´s theorem though states, there is no perfect voting system. based on this aspect of the talk the hypothesis can be stated, that the same will hold for recommendation systems.
it seem´s though that in recommendations systems the technology seems to struggle already with simple majority voting systems.

read more on "good relations", twitter & co in the second part of the dexa coverage.

legal gibberish of investors in plain language

noreply@blogger.com (hannes a. schwetz) — Thu, 06 Aug 2009 05:00:00 +0000

investors inject money in start.ups and they want it back. x-times in the best case, although most of the time the just loose it. so in those selected cases where a start.up works out well ,they make sure to get their money out. how they want their investment back is nailed down in the legal contracts which come along the money. every start.up should know this terms ahead of an investment. why? because otherwise they are in a game in which they do not know the rules. and that makes succeeding impossible.

this is no legal advice - as that´s the job of attorneys. rather putting legal gibberish in plain language. links are there to offer alternative explanations and resources. this post goes in line with the series "six steps to venture capital" , in particular part 5 on negotiating: in order to negotiate well, one has to know the typical terms in vc contracts. so here we go:

tag along rights/co sale rights
protection for minority shareholders. in case the majority shareholder sells his shares, the minority share holder can demand his shares to be sold on the same terms to the buyer.
this avoids that e.g. a big stake of the company get´s sold off to a strategic buyer making the remaining shares de facto un-sellable=worthless.
link investopedia

drag along rights
protection for majority shareholder. obliges the minority shareholder to sell his shares to a buyer on the same terms as the majority shareholder.
the idea is, that e.g. a one percent shareholder must not be able to block sale respectively the exit of an investor.
links: investopedia, slashstar

pre- post money valuation
definitions of company value. if a company is worth one million before an investment, this is the pre money value (before vc money gets invested).
after a two million investment, the value increases to three millions (one million company value plus two million cash), called post money value.
link investopedia, socaltech

anti dilution provision/clause
protection for investor. forces the transfer of shares from the initial shareholder to the investor in case the value of a firm decreases in the period after the investment.
if an investor a puts 1 million in a company which was worth 10 millions (before his investment = pre money) he will get 10% of the shares and the company value increases to 11 millions (post money). now assume there is another investment round with investor b only willing to invest 1 million at a company valuation of 6 million. this will trigger the anti dilution clause, as the company value decreased from 11 million to 6 (=down round). in this case investor a will demand shares form the initial shareholder in order to be compensated for the devaluation. e.g. increase his shareholding such that (after the investment of investor b) he will finally hold 15,71% of the shares (0,1571*7=1,1).
links vcexperts, investopedia

(full) ratchet
protection of investors. typically a performance depended anti dilution provision which (completely) compensates an investor for the devaluation of his shares (see above) as agreed goals are not met.
e.g. an investor injects money in company according to milestones, like sales revenues. if milestones are not met – thus leading to a lower company valuation - the initial shareholders loose shares to the investors.
link vcexperts

earnout
protects buyers, brings upside for sellers. the final price of a company depends on the performance within a time period after the transaction.
buyers of a company pay a base price for the takeover of a company. if e.g. in a period of one year after the buying the company outperforms its profits, the sellers gain a premium.
link investopedia

exit preference / participating preferred stock
protects investor. in case of a company sale, money gets first distributed to the investor and the remains to the initial shareholder. the method of distribution can vary widely.
one way would be as follows. A company gets sold 5 years after the investment of 1 million for 50% of the shares. of the exit proceeds of 5 millions the investor gets the initially invested 1 million. then he takes the interest rate of 15% per year for his invested money (around 1 million), leaving 3 millions. having 50% of the shares he takes another 1,5 millions, leading to a total of 3,5 million (3,5x or 28% per year). the remaining 1,5 millions go to the initial shareholder.
link wikipedia

pay to play
protects new investors. In case of a new investment round, the former investors/shareholders only keep special rights, if they participate in the financing.
special rights can be e.g. nomination rights for the advisory boards, anti dilution protections, or exit preferences. this clause intends to motivate old investors to support the company if further financing is required. also the governance is simplified, as old special rights get successively removed in new financings round.
links altassets, wikipedia

so much about legal stuff. no reason to let it come in-between the core business and the product. just one thing to look after and to get done right.

barcamp blinks

noreply@blogger.com (hannes a. schwetz) — Sat, 20 Jun 2009 08:29:00 +0000

a great location, a huge crowd of around 150 and a multitude of sessions made the barcamp vienna 2009 a thriving event. so lets have some blog-blinks on the event.

organized tightly from beginning to end, leaving out the intro round of the participants as well as not discussing the sessions took out part of the barcamp essence. the same goes for the general call to blog about it. let´s have that next time. participating day one of barcamp, those were the highlights:

freewave presented their wlan concept. the session was on the line between marketing pitch and sharing their motivations and experiences. their engagement to protect users against the ever growing data collection lust of public authorities impressed. that smart phones already account for 40% of traffic on their hotspots and they expect 50% throughout the year as well.

the cloud made it possible for dctp.tv to bring 21 years of tv shows online. at 10% of the costs of a conventional (=buy hardware) solution. fabian topfstedt held a interesting session on this project.

Cloud Computing and WebTV (English)

View more PDF documents from topfstedt.

the media watch on climate change project of module university, the thank worthy host of the barcamp, show the next step of data monitoring and analysis. the origins of academic research are still dominant. see also the idiom project. there is also their start.up "weblyzard" to monetize their work, which is in strong need of a internet strategy makeover though.

the jolicloud session of alexander kirk showed a visionary approach on netbook os. jolicloud= nebook oriented os=classic os+socially enriched. e.g. one sees which apps one´s netbook peers installed and proposes to do the same. looks promising.

more pictures of the barcamp can be found at the start.upICT flickr stream. finally the top quotes of the barcamp:
"....die usa ist ein problem..."/ „..the u.s. are a problem...“. totally taken out of context. and finally "mein rechner hat keine windows taste!" / „my computer does not have a windows key!“. cu at the next barcamp!

how to win seedcamp & other pitches

noreply@blogger.com (hannes a. schwetz) — Wed, 20 May 2009 08:35:00 +0000

start.ups compete all the time. for customers, money, press attention, employees. how to win such competitions was in the spotlight at the opening event of the mini seedcamp laibach.

the most minimalistic approach for a successful pitch is to a) show your product, then b) show your google analytics metrics and finish by c) shutting up. then wait for questions from the audience. to be clear, this also means d) not to talk about technology and e) all the rest.

this is the essence of the introductory talk of dragos ilinca from ubervu, 2008 winner of seedcamp on “how to win seedcamp” and other pitches.

a crowd of 50 people was gathering together for the pre-opening of the laibach mini seedcamp 2008 at kiberpipa. spreading out all over Europe, this was the 6^th out of 7 mini-seedcamps taking place all over Europe, from paris to ljubljana.

having lost count of all the pitches held around the world, be it 20 or 50, dragos was blunt in what to expect from venture capital. “90 percent of the start.ups fail, most do not fit into the venture capital criteria."..."start.ups not solving a critical problem will get no funding!"

How To Win Seedcamp

View more OpenOffice presentations from Seedcamp .

the same holds for those which don not know why customers will spend money for their products or do not have an excellent team. those things sound common. still, most start.ups do not practice it in real life.

thanks to the folks from kiberpipa , there is a complete video coverage of the opening event:

How to win Seedcamp? from Kiberpipa on Vimeo.

read on about seedcamp laibach in the upcoming post “venture capital is not fast food”.

let the pictures talk: mini seedcamp laibach 09

noreply@blogger.com (hannes a. schwetz) — Sat, 16 May 2009 12:48:00 +0000

ahead of the upcoming in depth coverage of the mini seedcamp laibach, let the pictures talk. feel free to use the pictures, all under creative commons attribution-sharealike.

interview with christoper clay of soup.io, part 2

noreply@blogger.com (hannes a. schwetz) — Tue, 05 May 2009 05:45:00 +0000

Image via CrunchBase

this the 2nd part of the interview with christopher clay.f ounder of soup.io. where christopher sees the need for new start.ups and if austria is a good location to start are in the center of part 2. if you missed the 1st part of the interview, look here.

christopher, which areas do you find most in need for new start.ups?
translations services are in need. translation is annoying us right now, the work flow of translating takes a lot of time. that´s a problem of all european [internet] start.ups. it is an opportunity for a start.up if you can double your market with being available on more markets, it is worth money for them. however, i do not want to say too much right now on that.
actually good opportunities are found by doing your first start.up. you itch on a certain problem, you feel the pain and then you can go after it.

you have successfully won yeurope and seedcamp and those investors are now holding 43.3% of the company. what can start.ups expect from such incubators, what not?
their main idea is that they give you just enough money to work on your product for three month without having to worry about living expenses. it makes a difference if can do a project in your spare time or just focus on it.
with seedcamp it was more about introductions. at seedcamp week we got to talk so many people. industry icons like the founders of bebo, photolog, last.fm, mysql and skype. venture capitalists like holtzbrinck or accel ventures of which you normally you would not even get a meeting with. seedcamp was putting you in front of all this people with initial credibility. seedcamp funds project further along then yeurope. it is like a compressed version of silicon valley in one week.

also there is the network of relations you build up. although you meet 100 people in one week and you can not remember all of them, you clearly can get in touch with them afterwards. if i would have a new idea, i could call to get some feedback.

what you do not get is solutions and answers. you get contacts, inspiration, what worked for others and feedback. but nobody will tell you what will work for you, no one will tell you how to get rich. it does not work like this. no one knows your product like you do.

soup.io is working in a crowded space. which three things did you do, to position yourself to become a seedcamp finalist?
at soup we want to give average people their space online. other then sites likes friendfeed, it is the user which is in front, not friendfeed. it is the one place you can put on your business card.

you spend a lot of time in uk and u.s./bay area. what´s your thoughts on start.ups in austria vs. europe vs. us?
austrians mainly did not understand what we did, which is probably why we did not find investment here. london was much more open to new ideas, and not just wanting to copy what was successful elsewhere [like germany].

in the u.s. it is just a hugely different scale. in silicon valley there are events where hundreds of people working on start.ups meet every day. so while the spirit is similar to london, the scale is still a difference.
people in the u.s. did not stop to believe in start.ups while in europe it got even worse. in the u.s. they see the cheap valuations of start.ups as opportunity.

what are your 3 recommendations for new upcoming founders?
first thing is to select your idea to found a start.up on a clear understanding on how to earn money. secondly apply to start.up competitions like seedcamp if you are in europe.
and finally, like already mentioned choose your location wisely.

stay tuned for more interviews with innovative start.ups, right here, on the start.upICT blog.

inside barcamp innsbruck 09, part 2/2

noreply@blogger.com (hannes a. schwetz) — Wed, 29 Apr 2009 16:14:00 +0000

in part 2 of "inside barcamp innsbruck 09" let´s have a look at usability, twitterish and more coverage on the barcamp. if you missed part 1, look here for different ways of barcamp sessions, iphone development or mobeedo.

usability
olivia haider, aka "olidax" delivered practical hands on examples about website user interface design - gone wrong ones and how to make them better. just to look at user interface design differently, look also at the evolution of websites, eg. tiscover way back in 1999 vs. 2009. or at the self declared design masters of apple here.

if ready to tackle a huge but well worthy slide set (87!), lisa reichelt also held a full house session at web2.0expo berlin 08 about improving website usability, titled "what users really want", but first have a look at olivia´s slides:

Usability Grundlagen

View more presentations from olidax.

twitterish
finally, unavoidably and highly appreciated, the latest and greatest in the twittersphere by luca hammer.
with all the services around twitter, one might already forget the original twitter. and yes, there were non-twitterer (two!) around at the barcamp, which for obvious reason are not to be named here. ;-)

there were two core aspect to the tiwtterworld in luca´s session:
one, to use twitter as "the" social filter to read and find interesting things on the net. gone are the days where newsgroups, email, bookmarks, feedreaders an the like where sufficient to manage the web-info-stream.

secondly, there are plenty of tools out there, which make this possible. although twitter might almost feel like a horse carrying a pyramid around - with all the services which "ride" on the back of twitter. be it twist to discover trends, monitter to monitor the twitteruniverse, tweetree a nice visualization or tiwtturly, which tracks and ranks the urls of fellow twitter"ers".
there were many more services and tools so luca promised to make a session/blogpost about it.

more on barcamp innsbruck
for photo coverage head over to here or here. thanks to takarina there is audio coverage, to be found at the bottom of the barcamp site. by the way, congratulations to takarina for her "tirolercast", best nationa l podcast winner 09!
only for the barcamp hardcore lovers, there is the the twitter stream of the innsbruck camp to get the realtime gossip, right here.

so much from the barcamp innsbruck. there are plenty of more barcamps coming up, so participate and blog about them.

inside barcamp innsbruck 09, part 1/2

noreply@blogger.com (hannes a. schwetz) — Tue, 28 Apr 2009 07:46:00 +0000

on the way back from innsbruck to vienna, the lazy train speed lets the thoughts about the april 09 edition of the barcamp innsbruck april 09 float freely. let´s have a look on the surroundings of the barcamp and then into selected sessions.

thanks to the organizing forces behind the 2nd edition of the barcamp in tyrol, christop dolar & astrid millebner. they organized a great location at the „zukunftszentrum“/ future-center right in the center of innsbruck. thanks!

a big open space, with room to hang out along the windows and the presentation area right at the heart provided the open atmosphere one would like to see for every barcamp.
there was plenty of good coffee and the omnipresent twittering and taking pictures with and of each other. and well, quite some good sessions. while the not-so-standard-conference format may seem anarchistic to outsiders, the sessions itself appear almost like magic in an ever aging surprisingly disciplinary style. barcampers hang out serious style. let´s look at some.

pichting bad and well done
weisswo, a local map based start.up held a "sales" presentation. obviously the did not think about the audience ahead. that never works. not at all.

mobeedo was also pitching their product, but what a difference. [update] richard spindler was proudly presenting their product, delivering a „wow“ effect and looking for feedback made the crowd come in front to see what they can do on the g1 android phone with mobeedo.

their video is worth watching.

what else? what about: iphone app development
well, well, an interesting practial and down to earth slot about iphone app development by thomas katzelberger. albeit the 1 billion downloads money printing machine for apple, anyone wanting to provide an application at the apple itunes store?1.800€! that´s how much it costs the tempted developer.

99€ per year for the right to put the app on the store. around 700€ for an iphone to test apps that use gps and the motion sensor. and well, best thing last, to run the free sdk, a hefty 1.000€ for an apple macbook. that´s because the sdk only runs on apple machines. 1.800€, well that is serious stuff.

after that said and ignoring the ever appearing stories about instant american millionaire richness of some developers, there is one magic thing to remember: top 100.

if your app is not in there, there is no attention. no attention, now money. wanting to make money via apps means using the short time frame which every new app get´s on the store. after that, a hefty release/update schedule can help to stay on the front page and so make the uphill battle into the top 100.

and no, do not even try to spend advertising for your iphone apps, that is just a waste, according to thomas katzelberger , who also says „do not expect anything, do invest only the minimum“.

thanks also to the live streaming efforts of luca via mogulus, quite some sessions (depending on the mood of luca´s wintel machine) were streamed out to the interested barcamp follower.

so much for the first part. more on this years barcamp innsbruck coming up soon.

all about "start.up competitions", fresh from barcamp innsbruck 09

noreply@blogger.com (hannes a. schwetz) — Mon, 27 Apr 2009 08:42:00 +0000

ahead of the upcoming in depth look at the barcamp innsbruck 09, which took place last weekend on the 25-26th april, the slides of the session "start.up competitions" are already online.

startup competitions

View more presentations from hannes.a.schwetz.

ready to compete? seedcamp laibach application deadline 27th of april

noreply@blogger.com (hannes a. schwetz) — Tue, 21 Apr 2009 11:38:00 +0000

there is a mini seedcamp coming up in laibach(slovinea). while the actual competition takes place on thursday the 14th of may 09, the application deadline is approaching fast: midnight on the 27th of april. apply right here.

although there is an expressed regional focus on southern europe, this is a rather nearby place for austrian start.ups to compete and certainly an opportunity not to be missed.

barcamp innsbruck 2009 & 25 start.up competitions now on the start.upICT finance mindmap

noreply@blogger.com (hannes a. schwetz) — Tue, 21 Apr 2009 09:39:00 +0000

barcamp innsbruck april 2009 is happening this weekend (25.-26. April 2009 ) in tyrol (AT) and i am glad to join. i propose to discuss the topic of start.up competitions. any inputs are welcome.

in preparation of the upcoming barcamp , the start.up finance mindmap has gained plenty of updates on the area of start.up competitions: there are 25 now on display.

furthermore the interviews with andraz tori and christoper clay as well as the series "six steps to venture capital" can now also be found in the ever growing topic map of the start.upICT blog.

the popular finance mindmap as well as the topic map can now be accessed directly through the top links on the right of the blog in the "START.UP FINDER" section.

interview with christopher clay, founder of "soup"

noreply@blogger.com (hannes a. schwetz) — Mon, 20 Apr 2009 05:00:00 +0000

Image via CrunchBase

time was running fast, when talking with christoper clay of "soup". soup is a "tumblelog, a super-easy blog that can do more than just text: post links, quotes, videos, audio, files, reviews and events.". try it out here or just have a look what is going on at soup. winning seedcamp in 2008, working in vienna, london and san francisco, there was a lot to talk about the daily life of the young austrian start.up

this is the second interview in a series with creative new start.ups, after an interesting discussion with andraz tori, founder and cto of zemanta.

christoper, tell me about the (three) most exciting things about start.ing up your company?
first it is all about the places we have been. from berlin to cologne, living for three months in london and just coming back from working for three weeks in san francisco. talking to people, pitching to them all around the world, that‘s been great.

second exiting thing is all the feedback we got. we have 20.000 active users now from all over the world. just scrolling through our feedback tumbelog is simply amazing.

third exciting thing is being your own boss. that is hard. the most important decision is to focus on what to do next. it is fun to learn from your mistakes - and we learned a lot over the last year.

what about the (three) most unfortunate things about start.ing up?
first hard thing is personal. i started the company with two co-founders - none of them is working any more with me. i would not start a start.up again, without having worked intensively with potential co-founders before. so that was very stressful to go through. however, we are three in the team again.

second is the roller-coaster live. there are really bad phases. one day everything works right and you are convinced that soon you are going really big. the next day you are depressed and think that is never going to work and facebook is going to kill us. it is stressful but exciting. therefore you need a good team which motivates each other. i would not be able to do this alone.

starting up in vienna in the hindsight is the third unfortunate thing. the decision to start here was right at the time. but the chances to get investments in the united states would be much higher. unfortunately it is hard to move to the u.s. . for example getting working visa without having founded a viable company in the us is tricky.

what are your lessons learned until now about starting.up?
number one, carefully preselect your co-founders. e.g. by working on a three month non-profit project with them before founding a company together.
number two, not found in vienna again, but in berlin, london or san francisco. because funding is much more easier there.
product wise, number three, i would focus stronger on the build in viral aspects of soup.io. they should have them in place from the beginning, rather then relying on the initial users we got mainly from friends at metalab. then we would be already ten times as big as we are now.

and number four: never give up. for example seedcamp. we got rejected in the first round (when zemanta won), because the did not understand what we did. we still went to the next mini seedcamp in berlin, explained personally what we did to saul klein und reshma sohoni and they proposed us to try again. and well, we succeeded the second time.

when you hear the words "exit" and "shut down", what comes to your mind?
the good and the bad, the two outcomes. either we are in san francisco, have hundreds of thousands of users and funding or we are back in vienna, broke and start something new.
the possibility of failure is very real, statistically most start.ups fail. but we are giving our best and try to make an exit one day.
although losing soup.io would feel horrible. we can not let our users down, so even if it would not work out, we will keep it running.

final question of part 1: how do handle private life vs. work?
probably i have not learned this yet. for me, the start.up comes first. like moving to san francisco and leaving people behind is hard but i would do it. so i am rather unbalanced on this yet. i want to be sure i tried everything for it.
what i learned was to manage my own expectation. when i am too tired some times and therefore have a none productive day, i know now that´s ok. that takes pressure away from oneself.

this was the first part of the interview with christoper clay of soup. where he sees the need for new start.ups and more, read in the upcoming part two.