January 31, 2011

Where Entrepreneurship is Easy
Category: Entrepreneur

The US seems to be steaming ahead in its drive to out-startup and innovate the rest of the world. Consider, the qualities an entrepreneur must show, as Mark Suster well describes :

  • Not very status-oriented
  • Doesn’t follow rules very well and questions authority
  • Can handle high degrees of ambiguity or uncertainty
  • Can handle rejection, being told “no” often and yet still have the confidence in your idea
  • Very decisive. A bias toward making decisions – even when only right 70% of the time – moving forward & correcting what doesn’t work
  • A high level of confidence in your own ideas and ability to execute
  • Not highly susceptible to stress
  • Have a high risk tolerance
  • Not scared or ashamed of failure
  • Can handle long hours, travel, lack of sleep and the trade-offs of having less time for hobbies & other stuff

Evidently, this level of creative drive is more easily sustained when you are not starving or worried about how to pay the rent. When friends, family, and companies in your neighborhood provide a safety net, for you when you crash or need to bounce back.

Then consider the whitehouse's Strategy for American Innovation, whose main lines are:

  1. Expand access to capital for high-growth startups ($2 billion)
  2. Expand entrepreneurship education and mentorship programs
  3. Strengthen federally-funded R&D commercialization
  4. Identify and remove unnecessary barriers to high-growth startups
  5. Expand collaborations between large companies and startups

Entrepreneurship is easier in a context that is so supportive. America is bound to have a lot more people prospecting for new businesses if the cost of failure and bouncing back is so reduced.

Cameron's Silicon Roundabout needs some beefing up to stay competitive.

Update

Speaking of which, just released:

Prime Minister Welcomes Cisco's $500 Million Investment Goal for UK as Part of Support for East London Tech City

January 8, 2010

Widget Media
Category: Online Economy

After a year of extensive development, Enclick has launched the following information services for social networks, blogs and individual web sites.

Keeping with the current vogue for the free price policy, all the web sites have free widget services. Needless to say the services have quickly found social traction with 100,000 webmasters taking a widget

April 14, 2008

2009 the Year of Online Brand Marketing
Category: Online Economy

The UK spent €3500 in online advertising during 2007, according to a recent study by PricewaterhouseCoorpers and the World Advertising Research Centre (WARC). Online advertising grew 38% during 2007, taking a market share of 15.3% of all UK ad spend. Online advertising is the biggest advertising medium save Television. The study shows that online advertising should top TV advertising during 2009.

All About Brand Marketing

Advertising managers have tested the online medium with harsh conversion campaigns, where campaigns are measured in terms of new customers subscriptions or sales. The next phase is to start using the medium to build brand awareness.

Formerly the preserve of Television, brand marketing is increasingly resorting to rich media and online video to reach target groups. According to the head of the IAB

It’s clear marketing directors now recognise the value of online to drive their business, and more and more are using rich media and video to build their brands, just as they do on TV, Guy Phillipson, Chief Executive, IAB

Catch up TV - Launch of services such as BBC iPlayer and Channel 4’s 4oD are breaking the barrier between video entertainment and the internet as a communications or shopping tool. We are all consuming more video online, rather than Television.

Though brand based advertising, CPM advertising is hardly present on video sites at present. The premium channels such as MySpace Music and MySpace Film are leading the way, selling at a higher CPM rate. The IAB expects to see a greater contribution to online spend in 2008.

In the next few years, User Generated Content sites are set for the highest advertising growth rates

[Disclosure: We are invested in video USG site, tu.tv]

March 10, 2008

Executives Don't Make Good Entrepreneurs

A Harvard Business Review article identifies four deficiencies of corporate executives when working in startup and small business environments. The four deficiencies are in fact great qualities for Executives in a corporate environment, but become their Achilles' heel in entrepreneurial work.

High uncertainty, knowledge intensive tasks, and a rapidly changing market sector are a fact of life for startups and entrepreneurs. Training, experience and value system for a competent proffessional administrators give rise to difficulties adapting in startups in the four following ways.

The first tendency is lack of loyalty to comrades. Startups require strong leadership, and great faith from the staff. Startups have great uncertainty, no guaranteed results, little rational assurances. The entrepreneur must offer a great vision, and a sense of a life altering opportunity. The entrepreneur must give of himself and the company (equity). He must be loyal above and beyond, to expect loyalty back. The usual corporate paycheck and pension plan are not enough.

The second tendency is lack of task orientation. Executives are used to large scale service delivery and product improvement operations, where a portfolio of services must be cultivated, maintained and optimized for volume and maximum margins. The resulting inability to learn and see to the detail and finish of individual tasks makes for poor execution and finish of tasks. The cliche is their total reliance on delegating to staff in order to operate.

The third tendency is lack of conviction and single mindedness. Typically and executive will insist on guaranteed results. "But that is not guaranteed" is the cliche phrase. Without a high likelihood of results, the ultra rational executive finds it hard to commit; you need faith here. Startups create businesses where corporations dare not go; the zones of uncertainty.

Fourth and last is the inability to work in isolation. Executives excel through their negotiation, their team leading, their excellent communication and administration. In typical 10 staff startups, these same skills are secondary. The executive is unable to be productive without somebody sitting next to him.

As a former executive, used to directing business units with hundreds of staff, I can vouch that the four deficiencies are valid and representative of the corporate class. The deficiencies are due not just to lack of experience and training, but also prejudices, mis-conceptions and an unflexible value system. "you are too technical" often being the ultimate insult from one executive to the other. It has taken me a lot retraining, and some soul searching, to be a fully useful player in a startup.

For enterprising MBAs who know that it is at the founding of a business that equity is divvied up, I recommend a post by Jeremy Liew at Lightspeed Venture Partners, to give a balanced view of the skills a business founder needs. For corporate executives looking for more fulfilling work with startups, John Smithson's "The role of the non-executive director in the small businesses" is good.

It takes more than good administration to create a business. I find entrepreneurial and creativity training is still poor at most schools and universities. A tolerance for uncertainty and volatility is hard to teach; rational administration is still the core of most entrepreneurship courses.

As for John Hamm's HBS article on the limitations of entrepreneurs, it is easier to criticize the flaws of an entrepreneur, than to identify, praise and teach entrepreneurial skills.

January 29, 2008

Advertising Market Disruption According to IBM

You expect a scrappy insurgent startup to talk Disruption. Hearing IBM talking "disruption" is, however, much more amusing. IBM's last report on the media sector is entitled The End of Advertising as we Know It. The report does not pull any punches.

The next 5 years hold more disruption for the advertising industry than the previous 50 years, according to Big Blue. Apparently open advertising exchanges will replace traditional media wholesalers and agencies.

A strong concensus opinion, according to IBM's industry poll, is that open advertising exchanges will take 30% of revenues currently won by traditional media. The figure must be in the 5% to 10% range currently. With Google's adsense leading among exchanges with around 50% of online advertising. Yahoo and Microsoft are desparately trying to muscle in.

The big looser will apparently be the 30 second TV spot.

IBM's solutions for traditional marketing agencies? If you cant beat them, you join them. Buy yourself a new business model and infrastructure (preferably from IBM), and hook into these open exchanges. This is not the first market that has succumbed to electronic trading.

January 4, 2008

Ad "receptivity" High for Online Video Advertising
Category: Online Economy

Brand marketing has different metrics to online sales marketing. Brand recall and engagement measure the first, sales conversion rates measure the second. New web2.0 web sites, social networks and video sites, are notorious for low conversion rates. New surveys are, however, showing excellent brand marketing results.

A cross-media study, by Experian Research Services, found that viewers are 25% more engaged in the content of TV shows that they watch online than on a TV. John Fetto, product manager at Experian, said that TV ads online are especially effective at reaching consumers.

"Web sites that are extensions of properties that exist in other media channels have great potential to funnel audiences that are highly engaged in the first place," he said

The Simmons study was based on 74,996 interviews with U.S. adults about the TV programs, magazines and Web sites that they watch, read and visit. The survey was conducted online and via telephone between October 2006 and September 2007.

[Via Meadiapost Publications]

[Disclosure: Yes, we are invested in a video and a social networking site. My views may be biased.]

December 20, 2007

First Year Anniversary for tu.tv

Exactly one year ago, the tu.tv team spent a white night launching their baby. And as one of the proud parents, I insist on showing you a video of Jon Elosegui and his team installing the first tu.tv server.



Thirty servers and over ten Gbits of bandwidth later, we are approaching 10 million unique users a month. The tu.tv team has hit the perfect viral storm, check out the traffic graph below.

tu.tv

The systems department has responded heroically. Even though it occasionally came down to me driving a van full of servers to our London datacenter, capacity has always been ahead of the viral whirlwind's demand. Nobody says incubating is easy.

Not to be outdone, the Sales team has sold its first major brand campaign for Nokia. Unlike straight banners on the site, video overlays have great impact on viewers. Given its similarity with TV advertising, clients and agencies are rapidly accepting the format. All good news on the profit & loss side. It is all looking good for a great second year.

Happy birthday and congratulations to Jon, Felix and company. Have a great second year.


December 11, 2007

Hollywood Writers: More Creative Class Disruption
Category: Creative Class

wga

The trend continues; managers-administrators are being squeezed out of the value chain by the "talent", the creative class. Sports agents no longer make more money than their sportsmen, as was prevalent in the early days of football. Script writers in Hollywood are following suit with the WGA strike, pushing the film and TV entertainment value chain for a bigger percentage of earnings.

The internet is touted as the catalyst for this dis-intermediation. Mark Andreessen paints a convincing scenario of how the creative class will distribute their work directly, without the need to go through the big studios. Thanks to new video technology, the cost of productions is dropping; no need for extensive fund raising. And great material is picked up and distributed rapidly by the social filtering sites, like youtube or digg; no need for massive marketing and distribution budgets.

"Make it, blog it and they will come"


November 30, 2007

UK to Spend €20 billion Online This Christmas

santa
"Ces anglais sont fous" is the comment from one of my partners on seeing the research by Forrester- "these englishmen are mad". The stupendous figure comes to £333 or €500 spent online per capita in the UK.

Such a stream of cash trickles down to everybody in the online sector. Online advertising prices and revenue naturally goes through the roof, as etailers vie for customers. A rough figure is that 10% of this revenue is respent on online advertising.

enclick

The enclick team will shortly unveiling a social shopping experiment, just in time for the Christmas frenzy. It will be interesting to see wheter it attracts a community or not.

All I am saying is that continental etailers dream that mainland Europe fall prey to this dementia too.

November 8, 2007

tu.tv launches in video advertising
Category: Online Economy

Even mighty Google needs to pay bandwidth fees and is moving to offer marketing agencies a platform to advertise on youtube videos. Tu.tv has been the first to offer in video adverts to its advertising clients in Spain. This is what a in video advert looks like.


www.Tu.tv

October 10, 2007

Google Buys Finnish Copresence Firm Jaiku
Category: Smartmobs

jaiku
Insanely jealous is how we feel. Jaiku founder, Jyri blogs the news Jaikido Blog | We're joining Google.

When going through periods without a hot viral startup project from our stables blitzing up the traffic rankings, we have consoled ourselves by saying well it is so difficult in Europe, fragmented market that it is...blah, blah, blah.

All the while Jyri and his partners had a vision of a community tool for sharing presence. As you would expect in Finland, they team used smartmob fundamentals in the product, and was very mobile phone based. Jaiku is mobile phone oriented version of twitter. It is nicely engineered, though does not have the enthusiast following of twitter.

The team is well versed in the mobile smartmob field. Jyri's presentations are entertaining, conveying ideas with depth and clarity. He is on course, in fact, to single handedly make black cardigans a cool clothing apparel.

While there have been occasional acquisitions in the European tech market, the GYM trio have shopped mostly in the United States. So it is tremendously annoying to have one's complacency shattered so.

Congratulations and best of luck.

September 18, 2007

tu.tv in the Top 250 Most Authoritative Sites on Technorati

Quite an achievement for a web service that has avoided writing a blog. Who says engineers cannot communicate? The tu.tv team had a bit of a chuckle over this.

I guess it is not what they say, it is what they do.



www.Tu.tv

August 17, 2007

Over 24 Hours Outage at Skype
Category: Online Economy

skype
Mr Skype, you have over 200m users world-wide, an eight figure yearly revenue and then allow a bug in your network software? The Skype blog explains
Some of you may be having problems logging into Skype. Our engineering team has determined that it’s a software issue. We expect this to be resolved within 12 to 24 hours. Meanwhile, you can simply leave your Skype client running and as soon as the issue is resolved, you will be logged in. We apologise for the inconvenience. , Skype login problems - Skype Blogs

Guess the lesson is not to skimp on software testing for business critical systems. You are no longer a startup; you are a grown up now.

After getting use to skype calls between the guys in Madrid, Barcelona, San Sebastian and London, we are scrambling back to using landlines and Mobile. Ouch.

July 29, 2007

Microsoft Acquires AdECN Electronic Advertising Marketplace

ADECN

AdECN independent advertising exchange is independent no more. Microsoft has acquired it. AdECN was aiming to be for banner advertising, what AdWords is to text based advertising, as I described a few months ago when AdECN was prospecting the UK. William Urschel, founder and chief executive officer, AdECN states:

"Joining forces with Microsoft will provide the capital and resources to enable AdECN to scale the exchange at a much faster pace, making it more attractive to the advertising networks and other traffic aggregators looking to better serve their advertisers and publishers.

The move adds to pressure on traditional marketing agencies margins. Microsoft now joins Google in dis-intermediating agencies out of online advertising. A great move for publishers and advertisers.

And The Bad News

With a dependent exchange, where the exchange is also a publisher, other publishers inevitably compete on unequal terms. Google's Adsense advertising platform shows little of how campaigns are sold to different web sites, and the margins it makes on the sale are secret. William Urschel, nevertheless, pledges to continue with his vision of transparency,

All of us here are thrilled to join a team that shares our commitment to neutrality for the exchange and also believes that creating liquidity and intelligently matching supply and demand will be two of the most important roles for a technology provider to play in this rapidly growing and evolving market , William Urschel

Microsoft also states that it will maintain the Exchange's independence and transparency

Rather than an ad network, a true ad exchange is the neutral, transparent, automated connection between multiple ad networks. Both groups will benefit from the exchange’s neutrality and transparency, enabling them to make more informed decisions about their bid and ask decisions. Microsoft on AdECN

I remain skeptical. It would require exceptional governance for Microsoft to respect this statute at the expense of profits. The press release mentions the term "ROI" five times. Most likely prices, buy/sell margins and volume allotments will become as opaque as Google's.

We are down to American Association of Advertising Agencies (AAAA) and their subcontractor arbinet, to create an independent exchange where publishers have equal rights, and the market has visibility over how inventory is bought and sold.

[Via Read/Write WEb: Microsoft Buys AdECN Ad Exchange]

July 25, 2007

tu.tv Breaks into the Top 100 in Mexico

spanish free - video gratis

Free video site tu.tv traffic keeps on growing. It has broken into the top 100 sites for Mexico, according to Alexa Ratings. It is number two video site after youtube.

Talking with the tu.tv team reminds me that "When you grab a tiger by the tail, it is all about hanging on. Fortunately, the hispavista team has ten years experience of launching and sustaining online services; it is not their first time.



tutv traffic
tu.tv traffic accoding to Alexa Ranking

Nevertheless, feeding the beast is a challenge. Video sites are resource hungry projects, and the team needs to exercise ingenuity and flair in maintaining the service. It is a good thing the company has an engineering and technical background.

[Disclosure: We are invested in tu.tv]

June 12, 2007

tu.tv Breaks the Top 100 in the Alexa Rankings

spanish free - video gratis

Free video site tu.tv is in the throes of viral uptake. Since launch Christmas, traffic has grown to millions of unique users a month.The service is currently the number two free video service in Spain, behind youtube.com.

tu.tv alexa rank graph
The Alexa service ranks tu.tv number 88 in the its Spanish Top 100 list for today. Following its current trend, it will enter the top 50 by the end of the month. A look at the traffic graphs shows the doubling period is around a month; a worthy contender in the list of present day web2.0 success stories.

Jon Elosegui, head of innovation, is no stranger to viral growth; with half a dozen viral growth services to his credit in the 1990s and early 2000, he has detailed insight into how to create a thriving online communities. One of his salient themes is that it is about the product, not the promotion. The tu.tv service has had little uptake in the mainstream press, or among the blogosphere elite, the A-listers. Viral marketing has other vectors with which to access the target internet users.

When you have a hit product, promotion is often not necessary, and sometimes undesirable. The world is getting smaller. In the rush to improve the product and infrastructure in the face of ferocious uptake, marketing must take a backseat.

The innovation team is currently incubating new projects. You will see no press release, nor blogosphere comment on launch. Just straight launch into the young spanish internet user segment. A somewhat perplexing view of PR and "how to influence internet users", but you cannot argue with the traffic numbers.

[Disclosure: We are invested in tu.tv]

June 11, 2007

Flat Rate Mobile Internet Arrives in the UK
Category: Mobile

orange

vodafone

Orange mobile, together with other UK mobile networks, have launched flat tariff for internet browsing in the UK. The orange offer is £5 a month, or £8 to be able to browse during the day too. An improvement on Vodafone's offers flat rate of £30 a month. Orange's tariff extends to pre-pay customers for the first time.

Both offers have capped total daily data consumption to 30 and 15Mbytes respectively. Bandwidth quality remains uncertain, which impacts VOIP applications and skype-mobile, but email and texting should not be affected. In spite of the initial limitations, once users start browsing on their mobile, the mobile flat rate fight will no doubt drive prices down.

As with home connections, mobile flat rate internet changes mobile usage. Myself, for instance, I use my browser and web bookmarks more, plus I download application like free text messaging, hotxt, and other Instant Messaging services to replace my SMS.

Mobile operators, stand to loose significantly if users bypass their voice and SMS services. Just like land-line operators are loosing to skype and VOIP services. In an attempt to control mobile usage, operators pre-install their own web services on phones, the same way Microsoft pre-installs Internet Explorer on windows. Google's mobile department has been fighting to get Google mobile search pre-installed on phones, with mixed success.

[The Register]

June 2, 2007

Google Developer Day London

dibona

Chris Dibona keynoting Google Developer day in London. Open Source program manager at Google, Chris is ambassador at large among the Open Source and Free Software community. He is in charge of the Google's summer of code program, and also the legal framework of licenses under which the Google releases and uses FOSS code.

As expected, the Semantic Web (with capitals) came up during Questions & Answers; Chris is candid regarding the intellectual ambition and scope of SW, and is skeptical of its practical application and adoption among web developers. Given the volume of content and wide-ranging approaches to developing the web, he thinks standards will evolve organically rather than be dictated top-down. A widely held view considering Tim Berners-Lee's difficulty in forging concensus even within working groups at the W3C.

Google Maps Platform

Ed Parsons, Andrew Eland and Peter Birch, geo-spatial technologists, gave a sweeping view of the geographic data in corporate networks and User-Generated data waiting to be collected and exploited. Excellent work integrating Google Earth and Google maps through KML files, the new standard for encapsulating geographic and viewing data together with the multimedia information.

Mapplet is the term for Google map widgets. A mapplet deploys data and functionality on a users' Google map. Users can submit and select mapplets from Google's mapplet open directory. The same as Google gadgets. Google Maps is fast becoming the platform to render and present geographic multimedia information AND functionality. With 200m downloads of Google earth and the strong Open Standards emphasis, the commons community seems to be adopting the platform rapidly.

Google Maps Mashups

Mike Astle, from online estate-agent Nestoria, was forthcoming about working and organizing a Google mashup company. Nestoria's added value is geo-locating and processing estate agent information, either scraped or XML fed, onto Google Maps. Mashup business models are inherently fragile, as they depend on the whims of Google's rapidly evolving Map/Mymap/Mapplet platform, and Mike sternly fielded the inevitable questions during the Q&A.

Whether Google's creative commons ecosystem can also support businesses is still an open question. Only a few of the 50,000 Google mashups have revenues at present. Tellingly, Nestoria has built a buffer interface to Google maps, so as to allow swapping it out for Yahoo's map service.

Google Developer Day

Google Mobile Search

Gummi Hafsteinsson described the ease with which mobile web can be developed nowadays. The new converging xhtml standards allow a KEEP IT SIMPLE approach which eases targeting a particular mobile device/mobile user for a particular service. Google's mobile index is becoming the focus of conversation, as it is central for accessing mobile internet users. Gummi described how the newly relaunched index combines so-called transcoded and true mobile web sites to provide optimum results for the mobile user.

Google Gears

The big announcement was Google Gears. The ability to use Google spreadsheet, Google documents, Gmail and Google Reader while not connected to the internet. Google's office suite can now be used in lieu of Microsoft's Office suite. Google has stepped out onto the desktop software arena, no question.

Members of the Hispavista innovation team were present, with their boss Jon Elosegui, to hear the latest update on Google's APIs for the various mashup projects in incubation. User Generated content is increasingly geo-tagged and Google maps renders such tagging best at present. With Google Developer day ongoing in 10 cities, we were not alone.

[Ian Forrester provides a good interview of Chris Dibona over cubicgarden.com... ]

May 3, 2007

Correos Stand at Internet World 2007
Category: Online Economy

correos

I was surprised to come across the Spain Post Office (Correos) stand at London Internet World 2007 yesterday. Apparently, cross-border trading in Europe is catching on quicker than I thought; "we reach any place in Spain" is their message.

Correos is offering standard Direct Marketing services for Spain

  1. Direct Mail: dispatch of volumee promotional mail into Spain; leaflets, catalogues magazines
  2. Quality databases both acquiring and cleaning the list
  3. Parcel services already used by the likes of Amazon when shipping into Spain
  4. Registered post an alternative to the UK Post Office service for Spain

I applaud the move on behalf of Correos to open up cross-border online market further. I just hope businesses in Spain are taking note and planning to export into northern Europe in return. Certainly good news for Spanish online publishers since northern Europe merchants exploit online advertising fully in their ad mix.

Worst case scenario is that southern Europe becomes a consumer nation for value-added services and technology.

May 1, 2007

Online Shopping To Dominate in the Future

Impressive statistics forecast by the IMRG for the online retail in the next five years. UK shopping has come on in leaps and bounds, the trend continues with the forecast for 2007:
  • €63billion will be spent online by UK shoppers
  • 860 million parcels will be shipped to the UK's 26 million internet shoppers, 33 each on average
  • Online shoppers will each spend €2400 on average
  • 10% of all retail now online, rising to 20% in three years time

Online retail will grow in quality too, becoming an integral part of mainstream consumer's habits

  1. Inclusivity people of all abilities will use online shopping
  2. Normalisation online shopping will become integral to normal everyday life
  3. Diversification online shopping will extend to a wider range of products and services
  4. Shophistication online shopping services to become easier, quicker, safer and more valuable
  5. Exclusivity a rise in specialist boutiques, offering more niche and exclusive products

Cross-border Shopping

Cross border retail is gaining traction, as shoppers look for and find better deals across borders. Shoppers in Europe have forever shopped across borders, specially when located in towns near frontiers. With online shopping and international postal delivery, cross border shopping for better deals is about to take off.

Already, Spanish book purchasing relies heavily on Amazon UK deliveries, as no strong contender exists in Spain. Amazon UK has in the past purchased advertising from hispavista.com, our parent company. Bargain hunting is about to extend across borders; and the bargains are considerable, even in spite of delivery cost across Europe.

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