May 24, 2013
I am the Master of my fate
I have been debating this internally, I would really like your feedback on this. Do you feel that there is value in a conference like Startup Iceland? I think there should be, here are my reasons:
- Inspiration and Knowledge: The purpose of events and conferences is not just to listen to someone talk about their success but to get inspired to act. Take ownership of challenges and act on them. Having people who have walked that path share their experiences gives us motivation and courage. My guess is if you hear some of the speakers share their troubles and tribulations, you may say, hey, that does not sound so bad maybe I can do it. I think we have a fantastic line of speakers, any conference around the world would love to have this roaster…
- Networking: One of the most popular blog posts that I wrote was about the 2 Must have skills for Entrepreneurs, you guessed it right it is Networking and Selling. During the conference, you as an entrepreneur get the opportunity to have a booth where you can sell your idea and while doing that get a fantastic chance to network with local participants as well as all the guests who are coming into to Iceland. The guests who are coming are curious about Iceland and want to learn more about it and guess what you are the expert there, you live in Iceland. It is a fantastic opportunity for you to present Iceland and your company or your idea or your dream, whatever to build a relationship with someone across the pond. Having contacts around the world is invaluable to doing business. If your idea takes off and you need to go sell it in the US or Europe or wherever, having someone who you have met, connected in Iceland gives an excellent bridge into whatever you need to do in that persons home market. Don’t believe me ask Gunnar Holmsteinn, how he built CLARA’s presence in Silicon Valley. It is all networking and building relationships.
- Participation: Not everyone has the time or the energy to organize events like what we are trying to do with Startup Iceland, but we are doing this to bring value to the Startup and Entrepreneurial Community here in Iceland. We have fantastic press coverage, a lot of people want to come to Iceland and see this miracle of a recovery that is happening in Iceland. Dont you want to participate in this transformation? How can you contribute? well, it is simple, just show up! if you don’t have time to volunteer, then you can take the time to attend the event. There are 3 events, the Hackathon which does not require any fee, you just need to have a computer and know how to write software programs in any language, we provide the food, drinks and all the help you need to build something of value. The last hackathon winner got recruited into GreenQloud and the solution he build was released as a service by Twitter 2 week after he had built it. So, you don’t have software development skills no worries, show up for the Unconference event, where all we need is for you to participate and share your ideas on how to build a sustainable, antifragile startup/entrepreneurial ecosystem in Iceland and in the world over. All of us have ideas, here is a platform for you to contribute. You are shy and don’t want to do that, no worries, the 3rd event is a simple conference where you just participate and listen to those who have walked the path.
…all this being said, I hear people complain about the cost of the conference. I believe very strongly that the ticket price to participate in Startup Iceland is an Investment not an expense. An investment you are making in yourself, your company or your idea or your dream. Why would you not want to invest to build yourself? rather than focusing on the cost, focus on the value, what is the value you derive from participating? If you don’t think there is value in this event, I want to hear about it please share it with me, I have my email in the public domain it is bala at startupiceland dot com. We are here to build something and those who give feedback do it only when they care. So please care!
We had the same discussion last year, and I wrote a blog post on who should attend the event. Lets talk about costs, it costs thousands of ISK to get a flight ticket, hotel room etc to go to a similar event outside of Iceland. It should be obvious that having all these speakers come to Iceland would be beneficial to the local Entrepreneurial community. Still people complain. All I say is try organizing an event like this and provide food, drinks, venue for 250+ participants, flight tickets to 9 guests, hotels, taxi etc I have thrown the challenge out to many people, you have better ideas to organize this event please contact me and tell me how we can do this better. Every member of the group that is organizing Startup Iceland is a volunteer, none of us get paid to do this and if you thought this does not take time and effort, please reach out to me I will buy you coffee and you can tell me how we can do this better. I am not an expert but I am committed and motivated to build a startup ecosystem in Iceland to help the future enterpreneurs… help me to help them. Participate! nothing happens by magic or miracles, it is the age old saying, a lot of blood, sweat and tears have been spilt to build society. This effort is no different.
May 21, 2013
GreenQloud Hackathon Winners
In case you have been under the rock or not been following this blog, we are having our Annual Startup and Entrepreneurship Conference in Iceland on June 1-4, 2013. The first two days June 1st in the afternoon to the end of the day on June 2nd, we are organizing a Hackathon. Hackathons are a tradition that we are starting to implement in Iceland, we conducted one last year and found really talented software engineers and developers who created a fantastic solution in a very short period of time. I have gone on record to say that we are very serious about recruiting those who can “Show Us” their skill than “Tell Us” about their skill. Hackathons are a perfect platform for that. GreenQloud sponsored and organized a Hackathon during UT Messan 2013, the annual IT conference in Iceland, the Winner of the hackathon was hired by GreenQloud. The clincher in this is that both the winners are still in high school. I believe very strongly that this is the new interview process of the software industry, no longer are you required to have a piece of paper telling others what skills you have, you can demonstrate it and build something of value that can be launchpad for your career. Startup Iceland Hackathon is that platform, have you made up your mind about participating in it yet? It is free and we provide all the food and drinks during the entire hackathon event. What are you waiting for? contact us and we can get you registered to be a participant in the hackathon.
April 14, 2013
I was at the Seed Forum this year, but I could not participate for the whole day but I attended the cocktail hosted by the British Embassy in Iceland. It was fascinating to see the British Ambassador pitching to the startups to look at UK to locate or move their startups when they scale out of Iceland… he even went to the extent of saying moving to the US was not a good idea I am happy to see different countries pitching to startups and entrepreneurs in Iceland to move to their country, it is good for the Entrepreneur and it is good for the Startup Ecosystem that there is growth path out of Iceland. I got a good impression of all the teams that were pitching. I have written about why Startups should not be focused on raising money. I am going to repeat this until I turn blue, the focus of the startup should be to solve a really itching problem, win customers and raise capital from the customer first. As much as I support the initiatives like Seed Forum, I really believe that it muddles the real issue facing startups and entrepreneurs. The Seed Forum this year had a famous Icelandic Entrepreneur and Cofounder of Opera, Jon Von Tetchner, actually he lived and worked in Norway but he is Icelandic. He had a very good talk and Q&A session about being an Entrepreneur. His advice and the advice given by Brad Feld and every other entrepreneur who has walked through the fire of creating a company and successfully transitioning says the same thing – Delay taking money from Investors as much as you can. Sometimes it is not possible i.e if you need machines, or equipment or buildings you need Capital but with startups in Software you dont need any of that or Capital to get started… that is one of the reasons that I am so bullish on the fact that Software based companies that are building solutions on top of the new Infrastructure of Cloud Computing, Google, Apple, Amazon, Twitter, Facebook, LinkedIn, Pinterest etc will be able to bootstrap much better, faster and get through the valley of death without pledging your soul to the devil, no, not all investors are bad but there are different incentives if you are an investor vs if you are an entrepreneur.
In other news, Klak and Innovit merged into Klak Innovit… I am happy to see some movement in the Accelerator, Incubator and Institutions that help entrepreneurs collaborate and optimize in Iceland. Accelerators are a key ingredient in the Startup Community development and I believe Kristjan Kristjanson the new CEO of the merged organization has his heart in the right place. He also runs Startup Weekend, Startup Reykjavik and has been of great help to many startups since he started working with entrepreneurs in 2007-8 I think.
March 29, 2013
twitter fail image (Photo credit: Wikipedia)
I like Data as much as the next guy, but I am troubled by all the empty promises of big data. I think data is good but too much data is unwieldy and it becomes hard to separate the noise from signal. It does not matter how sophisticated our data sifting mechanism become it is still ugly. What worries me even more is our inherent ability to see patterns in tea leaves that could lead to hypothesis and theorizing based on Big Data. Nicholas Nassim Taleb in his book on Antifragility talks about this problem:
In business and economic decision making, reliance on data causes severe side effects – data is now plentiful thanks to connectivity, and the proportion of spuriousness in the data increases as one gets more immersed in it. A very rarely discussed property of data: it is toxic in large quantities- even in moderate quantities.
… noise and randomness can also use and take advantage of you, particularly when totally unnatural, as with the data you get on the Web or through the media.
The more frequently you look at data, the more noise you are disproportionally like to get (rather than the valuable part, called the signal); hence the higher the noise-to-signal ratio. And there is a confusion which is not psychological at all, but inherent in the data itself.
The world of Twitter and capturing every search by Google, we are fooling ourselves into believing that more data is better actually it is worse given the frequency of our observation. Maybe if we can spread the time variable out it could elicit some interesting dynamics. Anyways, it has been a lot of fun to read Antifragility the last couple of days… and fortunate to be in a place that is tranquil and peaceful, where inspiration is easy, all I have to do is look outside the window or walk out the door. I am in our summer house in Thingvellir, surrounded by mountains, lakes and glaciers and just pure nature, Icelandic Style.
Here is a troubling consequence of big data: Surveillance
March 4, 2013
Cover via Amazon
I usually get really worked up when I am speaking with some employees in a bank about Startups and Entrepreneurship, they immediately say that it is Risky. I always ask them could they please tell me why they believe Startups are risky? Their usual answer is well 90% of all startups fail, which is anecdotal evidence because there is no way anyone has documented all the startups in the world and calculated the failure rates. I have written a lot about how we as humans are wired to be fooled by statistics and we just underestimate the risks associated with many things. What is even fascinating is that those same people from the bank were still working in the bank when the entire financial system in Iceland collapsed. I think banks are bigger risks than startups, atleast with Startups you know the risk of failure will only wipe out what you invested, whereas with Banks it can wipe out the entire equity base of Iceland. No wonder, Warren Buffett called Banks sit of Weapons of Mass Destruction. The risk on banks are exasperated by leverage, were as Startups run on equity which means what you put in is what you loose if the company goes under. Typically Startups that I have been pounding the table on require very little capital to validate, build a Minimum Viable Product and get market traction.
I have written about the books that really changed my perspective on Risks and I have Nasim Nicholas Taleb to thank for. I listen to audio books all the time and I think this is the 100th time that I am listening to his classic book “Fooled By Randomness“. There are so many pearls of wisdom in that book that I discover something new every time I listen to it. The only positive aspect of risk taking is in the Startup world because a black swan event ie. the chance of finding a Google or Facebook or Twitter or Amazon is very low but when it does happen it usually results in such a positive impact I don’t know why not everyone invest a small portion of their investment egg in this asset class. The monstrous returns that are possible can only be achieved if one takes enough bets but the size of the bets are usually very small and thats the point of doing this.
September 20, 2012
The world of software development is changing… there I have said it. Going with the thesis that “Software is going to Eat the World“, I believe it is important to give context to this notion. I started writing code a long time back, I am a closet geek i.e I like to make things and the command line does not scare me. I have seen the evolution of software development, adopted and been a pilgrim to a few religions only to learn that the market dictates which religious camp you should be part of. If you are with me so far then you understand what is going on in the software world. Lets continue on the context part, today everything that we do involves something to do with Software, you mobile phone, the car you drive, TV programs you are watching and how you get electricity into your home. Given the broad application of software, it is important to know that today the world of software is hyper connected i.e Software written in one environment talks to software written in another environment with small tweaks through what is called Application Programming Interfaces (API), the interoperability brings with it a huge network effects. This is not a universal phenomena because there are still those who believe that writing software that does not talk anyone who wants to talk to it is a viable business strategy, I think that camp is going to die… if you are working for a software company and your software product or service does not have an API, run to the hills because you will become the North Korea of the new world. I see you are still reading this post, which tells me that software is important to you, good.
I had interesting meetings with some software companies who still believe that they need to build walled gardens of applications that don’t interoperate with the external world through standard APIs. I pity those who think that way. In today’s world Open Transparant API is the currency because it expands your reach and product base and partnership. If your company’s value proposition is not tied to being open and interoperable, you are dead out of the door. The Open Source movement has spawned an army of software some that I use and would like to contribute to and others that I would not recommend to my mother. There is a wide chasm between what is usable and what is full of crap… that is the cost of open source, never the less the biggest value of open source is adoption and expanded ecosystems. Internetis the largest ecosystem we have today and it is evolving it is built on open source, standards based API.
This image was selected as a picture of the week on the Farsi Wikipedia for the 13th week, 2011. (Photo credit: Wikipedia)
Another new movement is the ability to have access to server environments at a negligible cost compared to what it was 10 years back. Today anyone can sign up with a Cloud Provider like Amazon Web Services or GreenQloud (disclaimer: I am the CEO of GreenQloud and the entire stack of software that runs on GreenQloud is built using Open Source software and the team has contributed a lot to the open source community through Cloud.com) and spawn a server environment, build an application and launch it on the internet and start selling it. All this has been made possible by Open Source software and Standard based API and the Internet. You don’t have to buy software you may still need to install some software in the server environment but for those who know what they are doing it is pretty straight forward. So, startups today when they say they need to buy Hardware ie. Server computers, it better have a compelling reason. Many of the standard services we use today are running in the Cloud, Google, Facebook, Twitter, Amazon, DropBox etc even Apple has a cloud offering called iCloud and Microsoft is following that strategy is launching their own versions of cloud services Office365.com, outlook.com, Skydrive etc to name a few. This new world is here to stay, there is no turning back, are there going to be hiccups along the way absolutely… I have no doubts but this hyper connected world with Services available through all the devices we carry and have on us is huge step forward. As we all like to say you have seen nothing yet!
July 29, 2012
A framework is more like a guide, it does not tell you how to walk the path but gives you guideposts on what you should focus on. Building great teams is the bedrock of building great companies. I have mentioned many times that when you are investing in a startup, the team matters a lot. Building great teams that execute is an important necessary condition. All other things you can change but the team dynamics is critical, it is hard to encapsulate and constant changes in team members and structure always leads to confusion and delays progress.
I believe the framework build by Jim Collins in his Good to Great book clearly articulates what I mean. The first stage in all great companies before they became great was the build up of disciplined people. Without disciplined people all other things falls apart, what do I mean by disciplined people? I can sum this up in one sentence, disciplined people are those who Make and Keep Promises. It is as simple as that. If you one can build a discipline to do that one can get disciplined in anything. There are a number of qualities that are required to be disciplined, I like :
- Respects other opinions
This is by no means an exhaustive list of attributes that comprise the winning team, however it is a good start. Paul Graham wrote a very interesting post about being relentlessly resourceful, he was of course referring to startup founders. I think the concept can be applied to anyone. I would like to be in a team that is relentlessly resourceful, that is resilient ie. when adversity hits the plan the team has a way to stand up and keep moving forward. Responsible is another word that I really like Dr.Steven Covey talks about this a lot in his books, the word responsible can be broken into Response-Able ie. have the ability to respond. Respecting others is not a nice to have but a must have quality. No-one knows everything if you want to win in the market place you need to bring people together who can compliment each others weakness. Thats the way winning is done! I wanted to leave this blog post with words of wisdom from a very famous philosopher Rocky Balboa.
The world ain’t all sunshine and rainbows, it is a very mean and nasty place and I don’t care how tough you are it will beat you to your knees and keep you there if you let it. You, me or nobody is going to hit as hard as life… but it ain’t about how hard you hit, its about how hard you can get hit and keep moving forward, how much you can take and keep moving forward… Thats how winning is done!
July 18, 2012
This is the first post of the “Welcome to Post on Wednesdays!” blog post in Startup Iceland. This post is a follow up post by Ashwin Bhambri and I think he has a point on trying to bring awareness, attention and glamour to the early stage investors. I am seriously thinking of including an award show as part of Startup Iceland 2013… what do you all think?
Image source: From Wikipedia, the free encyclopedia
Isn’t Angel Investing underrated or more so undervalued? The impact it can have on the global economy today is under estimated, as almost every third startup or small business requires to raise pre-revenue finance that banks or other organized institutions would typically not fund. Seed / angel investing is the only alternative left to the entrepreneur.
Angel investing is underrated simply because as a concept it is underutilized. There are just not enough proactive angel investors or money in angel / seed asset class for this activity to be considered mainstream or a serious factor in the building of economies.
Nevertheless, the potential of angel / seed financing and the overall impact it can create is colossal. If Peter Thiel had not to take a chance on Facebook it may not be the Facebook we all know today. Time and time again, those investors who took a leap of faith and invested in Angel rounds dramatically changed the course of history for many rockstar companies today starting from Google to Facebook to Twitter.
To be fair, Investing is also about capitalism and the simple theory if one does not see a return one will not invest applies. Arriving at an ROI from a pre-revenue start-up is not exactly pragmatic and an angel investor takes a huge risk here – What makes them invest is
a. They like the startup team, want to help and give back in the process
b. Their gut feel prevails over logic and tells them to go with a start-up.
Investors who repeatedly make angel / seed investments build the startup ecosystem and should be honoured with recognition and accolades for their contribution. There should be an attempt to glamorize angel investing and this could be the rocket fuel that catalysts more investors to join the angel bandwagon and can lead to more investment activity.
How do we do this? For starters there can be the Grammy and/or Oscar equivalent for investors or the Angel & Seed Investor Awards where active investors making investments are nominated and awarded, as investors are the early heroes of any startup ecosystem.
Glamour is also an amazing communication medium to a large audience and could convert traditional investors who typically invest in established listed companies to become angel investors.
Iceland could be the world’s accelerator of this initiative as the time & environment is optimum. Thus far I have not come across any Investor Awards event that is mainstream and it’s about time someone takes the initiative and makes it happen. If it fails it fails, if it succeeds it could do for the rise of angel investing what y-Combinator did for the rise of startup accelerators and that’s definitely a risk worth taking
June 21, 2012
Union Square Ventures just announced their investment in Duolingo.com. The company founder Luis Von Ahn is so smart and has a track record of really creating valuable solutions on the time people spending doing boring tasks on the internet. As Brad Feld says, the machines have taken over, they are just making us enter information about ourselves into them, they are being patient and eventually the machines will run the asylum. Luis invented CAPTCHA and re CAPTCHA two technologies on the internet that everyone who is reading this blog had to do many times while signing up for service or posting a link to Facebook or Google or Twitter or any of the Web Services that we use to let the machines know that we are human. What we all probably did not know is that this “data entry” is used to digitize all the books in the world! How cool is that? Here is the TED talk that Luis gave which explains how they did this, more importantly he explains subtly WHY he did this.
I believe this is incredibly smart investment by USV. The next frontier is language and sound, I have written about my investment thesis around sound and voice. The biggest problem we have with language is that machines don’t understand the semantics of translations and Luis is solving that using powerful motivators and incentives on the internet, the need of people to want to learn another language and making that affordable (read FREE) to everyone on the internet. Luis is nothing if not ambitious, but I have a feeling that he will be successful in translating the entire web. If you always wanted to learn another language and did not want to spend $500 to do it, Duolingo.com is the place to do it and BTW, you will be helping in translating the web which is 50% in english into a language that you are learning.
To Brad Burnham and the rest of the partners in USV, Congratulations! this ones a winner and keeper! you are really showing why USV is the top VC firm in the world.