20Apr

Doing One Thing Well

Todd Crosland Startup Site

Historically, file sharing startups have not done well. While attempting to disrupt the file sharing industry, many companies build out their platforms to include too many other tools. One such platform could have not only the ability to transfer files, but also a collaboration aspect, amongst other things. This is distracting, raises prices, and becomes the ultimate reason why such startups fail. One Dutch file-sharing startup, however, seems to have figured things out. The company WeTransfer has successfully disrupted the technological industry by keeping their product simple. Through WeTransfer, people are allowed to share large files, and nothing else.

WeTransfer quickly grew after being created, as shown by it reaching profitability in 2015. The company now has 80 million users and is preparing a move to the United States. When using WeTransfer, a person does not even have to sign up to send anything that is 2GB and smaller. To send files above 2GB, a user must sign up for a premium service that costs only $12/month. However, the company makes sure not to push any users toward signing up for their premium service. With this service and the extensive advertising on their website, they are able to make a large amount of money.

Currently, WeTransfer is experiencing a demand in the United States from creative people, such as designers. Therefore, the company is planning to open up an office in Los Angeles and take on some already lucrative startups in this country. Of course, it will come with challenges. Startups such as Hightail, formerly YouSendIt, have shifted their focus to appeal more to creative people. WeTransfer will have to shift its marketing to appeal to more Americans. They are, however, hoping the ease involved in their marketing at home will carry over.

It will be interesting to see how WeTransfer fits into the Los Angeles startup community, but their move to the United States should not overshadow the progress they have already made. This is a company that does not actively push a paid product onto its customers, and created its platform without the bells and whistles that other platforms may use to attempt to stay current. Rather, WeTransfer is focused on transferring files. They began their platform, found this one thing that they were really good at, and stuck with it.

A focus on what works above constant expansion should be a trend followed by more startup companies.

30Mar

Startup Quality and the Economy

Todd Crosland

It has long been thought that the number of entrepreneurial ventures in a society is what matters. This makes sense. The more small businesses that are formed in one place, the more jobs become available, and the more money is generated in said place. However, Jorge Guzman and Scott Stern, both of MIT, have found in a recent study that quantity may not be as important as quality.  Their paper takes an in-depth look at the startup field in America, and makes a few predictions about its future.

What Guzman and Stern do in this paper is describe ways to determine if startup companies are going to grow. Startups are known for bringing jobs to wherever they are based, but some types of companies have to hire more than others. If a small mom-and-pop shop opens in a city, for example, it will most likely only need a few employees. However, if an innovative company with the potential for a large amount of future growth is begun, it adds a lot more value to a community. These are the ones that help the economy the most.

The researchers refer to a company’s potential for growth as the ‘quality’ of the company, and link it to predictions about the future growth of a particular area. They mapped out the quality of different startup companies, and how quality linked to each company’s gross domestic product (GDP) growth. They found a significant correlation between quality and GDP growth in larger quality companies, but no significant correlation in smaller quality companies.

Of course, everyone who has ever taken a statistics class knows that correlation does not equate to causation. The GDP growth of specific companies could be directly related to the area in which the companies are growing, for example. However, this is an interesting concept for further study.

In order to predict the quality of a company, Guzman and Stern formed an algorithm. It tells them if a company with either go public or be bought for a large sum. This algorithm does not churn out highly specific results from company to company, but it gives a broad understanding of if a company will expand in the future or not.

While this paper leaves much to be desired from a research standpoint, it is also sends a powerful message to America’s entrepreneurial community as a whole. It disproves the idea that entrepreneurial ventures in this country are on the decline. It also challenges the idea that America’s economic growth is slow going. The amount of quality startups is increasing, which means that economic growth must be increasing as well.

Overall, this paper brings America’s entrepreneurial potential into the light. I am intrigued to see what the startup community will do with this information.

08Feb

Startup Takes on Quantum Computing

Todd Crosland

We can all agree that the advancement of technology, even from 10 years ago, has been profound. We now have phones that are, effectively, miniature computers, 3D printers, and self-driving cars, amongst many other life-changing inventions. Looking at the vast array of technology available today, it is difficult to predict what will come next. However, a new project that has taken over the technological sphere involves quantum computers, and a young startup company seems to be a front-runner in making the first functional one.

Rigetti Computing operates in a small Berkeley office space, working on producing a prototype quantum computer chip by the year 2017. Why by 2017? Apparently, the company, which is only a couple of years old, is attempting to release one of these chips before Google has a chance. They are working around the clock to make complex quantum computing, a concept that was once merely theoretical, a reality.

Quantum computers have been an unreachable technological goal up until now. Qubits, small devices involved in the quantum computing process, must be able to work together, but so far they are only known to interfere with the processing of each other. According to the company’s founder, Rigetti Computing has manufactured qubits that are stable and can work together on a much larger scale. However, Google’s CEO has said the same thing, which makes it unclear as to who will be able to release a prototype of a quantum computing chip before the other.

Rigetti Computing is aiming to create a chip that makes machines operate and learn more quickly, as well as able to run complex simulations in scientific fields. These computers will be complex problem-solvers, which could revolutionize industrial processes by making them more efficient in their energy usage than they are today.

Not only does the company want to create a prototype quantum computer chip, their ultimate goal is to send quantum computing into the cloud. They want to form a quantum-powered cloud computing service that is accessible to all with internet access. For a fee, any person or company would be able to run their problems on the quantum-computer chips, for quick and accurate results and solutions. They also want to be able to someday allow other companies to write code for their quantum hardware.

Of course, even just creating the prototype costs millions of dollars, which is money that Google has, but Rigetti Computing, as a small company, does not. However, the startup is not fazed. Rather, they believe that working in a smaller environment gives them an advantage over Google because their efforts are more focused.

The idea of quantum computing becoming a reality is exciting, but I believe what is more exciting is the prospect of a small startup company releasing such advanced technology. This could change the technological startup environment in a big way, and could spur intelligent young people to start their own companies in an effort to disrupt the technological sphere. I am hopeful, but there is still a long way to go to see if Rigetti Computing will be able to make quantum computing a reality, before much larger companies.

04Jan

Continuous Crowdfunding

Peak Design is a San Francisco-based startup company that generates accessories for small cameras. It recently just finished a Kickstarter campaign to launch its newest product, the Everyday Messenger Bag. The Kickstarter finished on a great note, with a countdown and celebration.

Interestingly enough, this is not Peak Design’s first Kickstarter campaign. In fact, it is its fifth. The company has been using Kickstarter to launch its new products since it first formed. The founder sees it as a great way to not only raise more money, but also to rope in initial customers who are already excited about the product. It seems to work, as Peak Design is doing very well.

Also, the company refuses to take on venture capitalists. This may seem counterintuitive, but Peter Dering, the owner of the company. wants to maintain his control of Peak Design. Their work model may not fit in with the work model of a venture capitalist, as Dering is constantly working from remote locations and employees are not given specific times in which they must be at work. They are encouraged to get out in the world and be active instead. Despite this, the company’s sales tripled in 2015 and, within its first year, Peak Design was profitable.

Dering’s launch of his company occurred at an ideal time. He created his first product, a clip that locks cameras to belts so they do not swing around, when Kickstarter was beginning to become a household name. Dering saw the investment platform as a built-in marketing plan for his products, and, $13 million in sales later, he still thinks along those lines.

Apparently, fully formed companies returning to websites like Kickstarter with new products is not an uncommon practice. However, Peak Design is part of the 1% that has gone back to the website 5 or more times. This is not for lack of trying, however. Peak Design got all it could with its credit out of a bank for its new product before going back to Kickstarter. The money from the bank would have only allowed them to order 5,000 bags, but using Funding Circle and Kickstarter gave them the money to order 45,000 bags. They would not have been able to do this otherwise without a venture capitalist, or having to sell a part of the company.

Overall, Kickstarter and platforms like it have proven to be a great resources for launching companies, and startup companies that have already launched. Startup founders like Dering prefer working in close-knit teams without any backer influence, which is exactly what crowdfunding has allowed him to do.

Whether or not this is sustainable in the long run has yet to be seen.

For more information on Peter Dering and Peak Design, check out this article in Forbes.

15Dec

Japan Rethinks Startups

The startup industry in Japan is struggling. The country is known for its large companies such as Toyota and Nintendo, but such large companies make it difficult for newly-formed companies to distinguish themselves. Younger people in Japan are more likely to take jobs at established firms, as they value having stable career paths and do not like the risk involved in starting their own companies. Therefore, startups do not thrive in Japan, as funding is difficult to come by. The government, however, is looking to turn this around.

The government is hoping to change many things related to their startup industry. They have already been attempting to encourage the launch of small businesses, but now they are paying more attention to companies that support the small businesses as well. For example, the government is focused on venture capital firms, as well as on creating a supportive startup environment and attempting to change the mindset of the less adventurous younger generation.

Obviously, this will take time and a lot of change.

The Japanese government is looking to start by instituting entrepreneurial classes in some schools, to encourage students to think outside of the box in terms of career paths. This will take a large amount of extra education, as much of the young Japanese population is hesitant to get into a precarious financial position.

The government is also working alongside Japan’s Venture Capital Association to push investors into making venture capital investments. Having large companies work with startups will, they hope, encourage professionals to take risks in starting new companies, as the professionals will now have some support. A large portion of this partnership is educating younger people on how venture capital works. They believe a better understanding of venture capital will lead more people to see venture capital investment as an option.

The government is also pouring a lot of money into the startup industry. They have put billions of dollars into helping the industry for the last two years, and the number appears to be rising every year. Events pairing startups with investors have become a trend as well. Basically, the government is working all possible angles to try and make their startup industry competitive.

The Japanese government wants its companies to be able to tap further into the global market. Their efforts to expand their startup culture will assist them in their goals overall, but they certainly have a long way to go.

For more information on Japan’s startup industry, I encourage you to go to this article in The Japan Times.

24Nov

Startups Embracing Washington as Simply Part of the Job

In the early days, tech companies like Google and Microsoft could make it a point of pride not to be involved with Washington politics. They were companies perceived as independent from, or even above politics and politicians. Now, in the golden age of the tech startup, leaders are having to not only accept Washington lobbying as a part of their operation, but embrace it.

According to the New York Times, startups have received a special kind of attention this year. Uber and AirBnb, two immensely popular convenience apps and startup companies have been in the public spotlight after facing a barrage of questions about their operations. Uber in particular ended up in long legal battles with the taxi companies of various cities. Startups that focus on large-scale innovations have gotten the message and are folding it into their day-to-day. Zenefits for example, an online benefits manager, is only two years old but is a member of two trade groups and has hired lobbyists and public relations strategists from the Obama administration.

“For these new companies, the scale of innovation is so big and impactful they necessitate interacting with Washington writ large,” said Kenneth Baer, a former spokesman for the Office of Management and Budget who now advises Zenefits. “There are huge amounts of questions that society has to grapple with that didn’t exist before.”

While overall money spent lobbying has decreased slightly over the last five years, for startups and young tech companies, it has tripled to $47.5 million. It’s hard to say what the effect has been so far, but for Uber and AirBnb at least, it has let them keep growing. For many startups though, the goal of lobbying in the short term is simply to create good will.

Coinbase, a digital currency platform, is one company who knew they would need to look for help in Washington right away. Knowing that finance is a highly regulated industry, they hired John Collins, former senior advisor to the Senate Homeland Security and Governmental Affairs Committee as their 50th employee. He is now their head of government affairs.

Mr. Collins has to prepare talking points about Bitcoin and regularly meets with officials at the Treasury Department, Consumer Financial Protection Bureau, Federal Trade Commission and multiple congressional committees. Every month he and the company’s chief executive meet with government officials. “So much of what I do day in and day out is not even advocating for anything necessarily but talking to folks about the technology,” Mr. Collins said. Bitcoin remains a largely misunderstood concept among people and almost exclusively receives negative media attention.

Startups and tech companies are having to get into conversations with Washington earlier and earlier. Marcela Sapone, co-founder of Hello Alfred, has said she wants lawmakers to consider new regulations that would relieve companies from providing some costly benefits. Such a large change requires careful handling.

“Why are we engaging so early? Mostly because we had to,” she said. “We have no choice but to get into these conversations.”

 

16Jul

JOBS Act Giving Crowdfunding a Boost

The JOBS Act (Jumpstart Our Business Startup Act), a law that encourages the funding of U.S. small businesses and startups by easing various securities regulations, had the Reg A+ exemption go live on June 19th of this year. The exemption will further facilitate access to capital for smaller companies and provide investors with more investment options.

Smaller companies now have the opportunity to offer and sell up to $50 million in securities in an annual period, subject to eligibility, disclosure and reporting requirements. This is great news for startups and small businesses, of which 86 of the fasting growing startups in the U.S. call Utah home. Regarded as the next “Silicon Valley”, the state leads the Forbes 2014 list of top states to do business, and ranks third on CNBC’s list of the best states to do business.

Because of this, crowdfunding platforms, such as Seed Equity Ventures, are now closing the gap for entrepreneurs working to raise capital in the early stages of their business. Giving them a direct lifeline to make it out alive past their seed stage. All the while, they are providing investors worldwide the option to get involved with compelling new opportunities they otherwise wouldn’t normally find.

The introduction of crowdfunding into the financial landscape of today has created an easy exchange of capital between businesses and their investors through its efficiency in getting key information out to the masses. And the numbers don’t lie.

Last year saw a 167 percent increase in money raised for companies and individuals via crowdfunding; that’s a $15.1 billion jump from 2013. Over $250 million of that came directly from venture capitalists and strategic investors.

Startups with even the greatest potential who choose to not go the crowdfunding route often find themselves struggling to stay afloat in their early stages, namely the seed stage. This is because most venture capitals and institutions are more inclined to make an investment in a smaller business once it’s already been established in the marketplace and seeking to expand.

16Jun

11 Ways a CEO Can Improve His Brand Via Twitter

Todd Crosland TwitterAccording to data from Statista. Twitter currently has 302 million active users. This is a huge market that can really boost a brand if used correctly. An article in Chief Executive lists 11 ways a CEO can use Twitter to effectively develop their company’s brand.

  1.  Create a social media policy – The marketing director should have a social media outline that would apply to all departments. The policy should include parameters that define boundaries between postings as a professional persona vs. a personal account.
  2. Find your audience – This is a standard marketing question: who is your audience? Are they using twitter? A CEO wants to find the right followers who are engaged and interested in what the company has to say.
  3. Do it right, or don’t do it at all – Tweeting is meant to be a continuous activity throughout the day. If you are reading a relevant article associate with work, Tweet it. Some experts suggest 30 minutes a day.
  4. Manage your own Twitter – If people are truly following the company, they will be able to tell if the person Tweeting is not actually the CEO.
  5. Don’t be afraid to get personal – Followers like to see real commentary and personality. Don’t only talk about work. Also talk about your favorite hobbies and tastes. This adds personal depth, which has proven to be successful in the Twitter world.
  6. Share your opinions – Going along with personal information is the CEO’s opinions on something topical. Engage in the Twitter community by re-tweeting an opinion from someone else’s account.
  7. Act fast when criticized – Effective CEOs are able to neutralize criticism on their company’s brand quickly. As the CEO, you should understand why and how your product works, thus understanding how to defend the brand in your own words.
  8. Don’t hide if your company isn’t doing too well – Twitter can be a great use of crisis management. Take to your online community and explain your situation. Customers like transparency, and know when you’re trying to hide something. Trust is instrumental for growing a customer base.
  9. Be careful of who you decide to follow – A CEO’s followers might be interested in the company they keep. The individuals a CEO decides to hang around say a lot about the CEO, just like the followers they decide to follow.
  10. Influence media – CEOs are in their position because they are seen as leaders. Use Twitter to promote thought leadership through interacting with reporters, bloggers, editors, and other influencers in the industry. This is also a way for CEOs to build positive relationships with media outlets. Twitter can be a great networking tool.
  11. Twitter is a PUBLIC sharing platform – A CEO needs to understand that even though some Tweets might be deemed “private,” there are still ways in which the public can get a hold of this information. Don’t let an inappropriate Tweet go viral.
07May

Crowdfunding – Democracy to the Business World

Todd Crosland GrowthAs the financial landscape continues to develop, and money can more easily travel from investors to businesses, certain products that show great promise see a greater chance of spotlight. Any start-up today would be remiss to overlook opportunities for crowdfunding in a technologically powered, democratically run world.

Crowdfunding is the easiest way for young entrepreneurs who are trying to introduce their idea to reach their funding goals through mass communication with and access to individual investors and investment firms. Because of crowdfunding, small ventures can reach mainstream appeal with relative ease.

The availability of funds helped Utah-based DemoChimp reach its financial goals by providing a connection to the outside. Businesses in Utah often struggle to reach the hotspots of angel investing (for example New York) and require crowdfunding efforts more than the average start-up. The newest in the digital community is DemoChimp. DemoChimp is primarily a business-to-business Software as a Service program that creates automated demonstrations of a product based on input criteria designated important by the customization of the user. It separates itself from more simple powerpoint slide introductions by designing mobile and visually interactive versions of a product for consensus-based presentation. It self-describes as software that “automates custom product demos to accelerate sales.” Its goal is to expedite, and nearly bypass, the process of manually arranging product demos to increase the adaptability of a typically, or formerly crystallized process. It is a highly organized form of data consolidation in a rapidly accelerating field. DemoChimp has already shown greater agility and dissemination of information with users feeling more comfortable about the priorities they can set for certain pieces or aspects of information. DemoChimp responds to the needs of the individual while representing the offerings of a business. It is cloud accessible and continues to facilitate the traveling of information across and outside of company lines.

DemoChimp & Crowdfunding

DemoChimp exemplified the essential benefit of crowdfunding by successfully raising almost $3 million from varied capital investors. It did this with the help of Albion Financial, Peak Ventures, and Seed Equity, a worldwide broker dealer and funding firm most affiliated with investments in start-up companies and digital campaigns. Seed Equity’s interest means a lot for DemoChimp, as the crowdfunding firm brandishes a personal mission of connecting the most promising business opportunities with global institutional and individual investors. This money raised from friends, related personnel, private investors, and large firms have established DemoChimp as a major player in the realm of business-to-business transactions.

The product continues to expand as it ventures into user-based automation, intelligently designing a demo around the specific demands of the viewer. Reports show that the artificial intelligence is embryonic but positively developing. This money raised from venture capital will be directed toward advancements in the software’s intelligence and marketing capacities. It will seek to find a balanced medium of granularity to assure maximum speed of operation with minimum overhead of communication. Funds not spent on the technical and operational components of the product will be directed toward new leads and customer acquisition. DemoChimp is already being operated by top corporations such as Microsoft and Hewlett-Packard, and its expansion into the non-digital realms is imminent.

06Mar

Pebble Time Makes Crowdfunding History

Todd Crosland Pebble TimePebble Time has surpassed the Coolest Cooler for most successful crowd funding campaign of all time. The smartwatch startup company, Pebble Technology Corporation, plans to release their new Time smartwatch in May of this year. So far their Kickstarter campaign has raised over $16.5 million in crowdfunding revenue, surpassing the previous record holder, the Coolest Cooler, which raised $13.3 million. And Pebble Time still ahs 21 days to go in their Kickstarter campaign, as they were the fastest to raise $1 million in the crowdfunding website’s six-year history. They were able to raise $1 million in a little over a half an hour and over $6.2 million in under four hours.

The startup tech company held the previous record with their first generation smartwatch raising $10.3 million on Kickstarter in 2012. The Coolest Cooler, a cooler with Bluetooth speakers and integrated blender, took the crown last summer raising $13.3 million.

Pebble’s new Time smartwatch comes with an e-reader screen similar to the one used for Amazon’s Kindle. This allows for a longer battery life, as Pebble promises 7 days of battery life.  In addition to the extended battery life, the watch is also water resistant.

This startup company now has validation as it looks towards future competition with Apple’s smartwatch. The founders of Pebble have all but nice things to say about the crowdfunding website, Kickstarter, as they supported the company ever since they were just five guys in a living room in Palo Alto.

Pebble’s success on Kickstarter in 2012 really brought the crowdfunding website to life, as it paved the way for other tech hardware startups to use this method of gaining capital.

The small tech startup has been able to compete with the big players like Samsung, LG, and Motorola thanks to crowdfunding vis Kickstarter. The competition will be difficult, but this story demonstrates the power of crowdfunding in allowing smaller players to make big impacts and inspire market change.