David Cummings on Startups

Category: Tech

  • The Power of APIs

    Dombeya acutangula Apis mellifera3
    Image via Wikipedia

    Applications Programming Interfaces, or APIs, enable applications to talk to other applications in an automated and structured fashion. They are powerful. Extremely powerful. Thinking through the advent of technological development we’re now entering a phase where robust, generally available APIs allow for significant new opportunities. It is much easier to mash up disparate data sources to provide new products that deliver results better, faster, and cheaper.

    In the same way cloud computing has changed the equation for scaling web apps, APIs are changing the speed with which apps can be developed. There are off-the-shelf APIs for a number of things like sending emails, looking up WHOIS info, connecting to Google AdWords, connecting to Amazon Web Services (that’s right – use APIs to scale up or down your cloud computing tools), validating a postal address, processing a credit card, finding your friends on Facebook, and many more. What we’re seeing is a proliferation of specialized services that interact with existing apps or provide niche data and tools.

    Traditionally, a developer would have to build something internally, most often coupled in a monolithic fashion, and then maintain it over time. Now, with APIs, specialists can do what they do best and other apps can focus on adding value as opposed to writing more code for something that is now readily available. APIs are extremely powerful and need to be understood by tech entrepreneurs.

    What else? What are some other powerful aspects of APIs?

  • Email Marketing Companies with 100+ Employees

    Email Icon
    Image via Wikipedia

    Email marketing is a strange market. It is one of the few technology markets that hasn’t consolidated into a winner take all (think eBay and auctions) or winner take most (think salesforce.com for SaaS CRM). In fact, there are a number of North American email marketing companies with 100+ employees (figure at least $15 million in revenue based on the low-end of $150k/employee/year revenue) all over the place:

    That’s just a quick list of pure-play email marketing companies in the U.S with 100 or more employees and contractors. There are more outside the U.S. and some that are divisions or larger companies like Epsilon. Tomorrow I’ll talk more about why I believe this market is unusual.
    What else? What hasn’t the email marketing market consolidated or become a winner take most market?

  • Business Idea: iPhone App to Make Driving a Game

    black Audi R8.
    Image via Wikipedia

    Earlier today I was driving to my ALTA tennis match and enjoying the beautiful day. On Roswell Road heading towards Chastain Park, I was merging into the turn lane and found myself splitting two reflectors in the road due to vering a bit too early. The precision with which I spaced the reflectors on either side of my front left tire put a smile on my face and an idea popped into my head: there needs to be an iPhone app to make driving a game.

    I’m sure someone else has already thought about it and that an app already exists (I haven’t checked yet) but here are some thoughts as to how it would work:

    • Use the GPS and accelerometer to measure the car’s location and motion
    • Develop tracks or routes like “Lenox Mall to Piedmont Park” or “GA 400 Exit 1 to Harvest on Main in Blue Ridge, GA) and have leader boards based on route time, average speed, lateral Gs pulled, and more
    • Award badges and bonus points for items like the fastest speed through turn two, night owl for doing the route after midnight, etc
    • Be able to put in your type of car for a handicap (e.g. a Ford Explorer would get an adjustment compared to an Audi R8)
    • Allow for custom routes like recording your daily commute for more badge types and categories (longest commute, most variable commute, most turns in a commute, etc)

    Yes, there are some public safety concerns with people driving too fast in attempt to set a personal best or top the leader board but I don’t think it’s anything crazier than people already on the road.

    Driving is fun. An iPhone app with a community makes it even more fun.

    What do you think of the idea? Will it work?

  • iPad 2 with Verizon 3G for a Week

    Steve Jobs while introducing the iPad in San F...
    Image via Wikipedia

    Last week I took my family to Florida for a trip near Rosemary Beach. We enjoyed the new Panama City airport and a quick 37 minute flight from Atlanta (yes, driving is only slightly longer counting airport interaction but our two little kids don’t like long car trips). Our beach house was supposed to include Internet access, but alas there was none. Thankfully, I had a new iPad 2 with Verizon 3G.

    Here are my thoughts on using the iPad 2 with Verizon 3G  for a week as my primary computing device:

    • The Verizon 3G bandwidth was much faster and more reliable than my iPhone 4 AT&T 3G bandwidth (at Santa Rosa Beach, FL) — Verizon 3G was surprisingly usable for most activities.
    • Writing these blog posts each night took longer than normal, but by the end of the week I didn’t think anything of it. I used the WordPress iPad app, had to code the HTML for the bullet points by hand, and didn’t put in many hyperlinks.
    • Web apps I use on a regular basis worked great (there were a few limitations like with Google Spreadsheets but nothing that slowed me down).
    • Flipboard became my primary means of using Google Reader and Twitter
    • Angry Birds Rio proved to be tons of fun and had nice UX enhancements over the original, but I would have liked to see a new type of bird or two introduced.
    • My total bandwidth was only 465MB, which is much lower than I expected and well within my 1GB/month plan.

    Will my iPad 2 replace my MacBook Air 13″? No. Is is a viable device on its own in lieu of a laptop if necessary. Absolutely. It was a great week and the iPad 2 did its job nicely.

    What else? What are your thoughts on the iPad?

  • Developer Tools in the Cloud

    SVG version of Bug silk.png by Avatar
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    One advent of software development that everyone talks about is how much easier and faster it is to build a scalable web app compared to 10 years ago. Of course, there are many good reasons for this including open source code, frameworks, cloud hosting, APIs available to mash up data, and more. Another reason is great developer tools and systems in the cloud.Here are a few developer tools in the cloud we use:

    • Lighthouse app and JIRA – issue trackers and ticket systems
    • GitHub and Beanstalk app – source code control platforms
    • Hudson – continuous integration server for automated testing (not delivered as SaaS but hosted on a cloud instance)
    • Rigor.com – web performance management and end user experience monitoring

    These developer tools and more make our software development process much more efficient and collaborative. What else? What other developer tools in the cloud do you recommend?

  • Product Review: The Resumator Applicant Tracking System

    Last week I was talking about our hiring process with my friend who runs the best IT support shop for creative firms in Atlanta and he referred me to The Resumator applicant tracking system. We promptly implemented it on our site and have been really impressed. Here’s why it resonated with us:

    • Clean, modern user interface that is fast and not Flash
    • Pricing model based on number of job postings with unlimited users works great for us (we pay $49/month for up to five jobs and they do have a free account for one job)
    • Integration with Scribed to view the submitted resume right inline (yes, it’s Flash but you can download the file)
    • Simple reports based on positions, candidates, pipelines, etc.
    • Embeddable job board and widgets to incorporate it in your site with basic color and logo customization

    I’m a fan of automating as much as possible and this is one more item to make us more efficient. If you’re looking at applicant tracking systems or want to see a good example of a well done marketing site and web app I’d recommend taking a look at them.

    What else? What other thoughts do you have about The Resumator?

     

  • Publicly Traded SaaS Companies

    Software as a Service
    Image by Jeff Kubina via Flickr

    Software-as-a-Service (SaaS) continues to be a hot area in the technology world. Partly because it has only really started to flourish in the past five years and partly because it is more geared towards SMB companies with a lower ticket price therefore requiring to sign many thousands of clients to reach scale, there aren’t very many publicly traded SaaS companies. SaaS companies are characterized by great recurring revenue, gross margins, predictability, and growth. Here are a few publicly traded SaaS companies and information about them as of December 12, 2010:

    • salesforce.com (NYSE:CRM) – customer relationship management SaaS and cloud computing company. They are the largest SaaS company and the first to reach $1 billion in recurring revenue.
      Market cap: $19.53 billion
      Last reported quarter’s revenues: $429.09 million
      Employees: 4,758
    • NetSuite (NYSE:N) – enterprise resource planning (accounting, inventory, etc) SaaS company.
      Market cap: $1.66 billion
      Last reported quarter’s revenues: $49.74 million
      Employees:  1,022
    • Constant Contact (NASDAQ:CTCT) – email marketing for small business SaaS company.
      Market cap: $872.21 million
      Last reported quarter’s revenues: $44.83 million
      Employees: 625
    • SuccessFactors (NASDAQ:SFSF) – human resources SaaS company.
      Market cap: $2.36 billion
      Last reported quarter’s revenues: $51.54 million
      Employees: 967
    • Taleo (NASDAQ:TLEO) – human resources SaaS company.
      Market cap: $1.29 billion
      Last reported quarter’s revenues: $58.74 million
      Employees: 916
    • LogMeIn (NASDAQ:LOGM) – remote machine access SaaS company.
      Market cap: $1.11 billion
      Last reported quarter’s revenues: $25.35 million
      Employees: 387
    • LivePerson (NASDAQ:LPSN) – live chat SaaS company.
      Market cap: $524.75 million
      Last reported quarter’s revenues: $28.22 million
      Employees: 349

    Personally, I’m a big proponent of SaaS and am very optimistic about the future. It should be an interesting market to watch.

    What else? What other publicly traded SaaS companies would you add to the list?

  • Salesforce.com Dreamforce 2010 Wrap-up

    Salesforce.com put on another impressive Dreamforce show this week at the Moscone Center in downtown San Francisco. We’ve been doing the show now for three years and it continues to grow fast. Last year had 17,000 attendees and this year there were 30,000. That’s impressive growth, especially at scale. Some of the key takeways from the show for me include:

    • The cloud is becoming more and more pervasive with salesforce.com leading the way
    • Salesforce.com Chatter is now freemium whereby companies can use it for free and then pay a premium if they need more advanced functionality. I think Chatter is nice but won’t be the game changer that transforms salesforce.com, as they claim it will.
    • Salesforce.com launched database.com as a database-in-the-cloud service (side note: imagine how expensive that domain name was — I’m guessing at least $1 million). I don’t think database.com will be successful as long as the per user pricing model remains. The other big challenge it has is lack of drivers and code to make it work seamlessly in popular languages like PHP, Ruby, and Python.
    • Salesforce.com bought Heroku for upwards of $250 million and finally has a credible strategy to significantly expand beyond their traditional user base and per seat pricing. It’s going to take many years to see if this acquisition was worthwhile but my guess is that if they can get the corporate culture alignment right it’ll prove to be brilliant.

    Salesforce.com is one of the best sales and marketing machines in the world and the show didn’t disappoint.

  • Thoughts on salesforce.com and Heroku

    At today’s Dreamforce show the big news was that salesforce.com has acquired Heroku for $212 million in cash. Heroku is a Platform-as-a-Service offering for Ruby on top of Amazon Web Services. This is salesforce.com’s largest acquisition ever, and is more dramatic considering that it is estimated that Heroku has less than $10 million in revenue.

    Here are a few thoughts on the acquisition:

    • salesforce.com has the Force.com platform for building apps but it requires a non-standard Java-like language that hasn’t had much adoption.
    • salesforce.com has the VMForce.com initiative in private beta which will run Java apps but Java apps are much more cumbersome to write compared to Ruby, PHP, and Python.
    • salesforce.com just launched database.com for a true cloud database offering but has a $10/user/month pricing in addition to storage costs which make it unlikely to catch on.
    • Heroku offers a true PaaS with pricing inline with the normal hosting industry making it the first real initiative that will grow salesforce.com outside their current core uses.
    • Heroku is built on Amazon Web Services which offers virtual private servers in the cloud. Heroku takes the Amazon cloud instances and sub-divides them further into even smaller instances as well as takes away much of the complexity. It is brilliant.

    My take is that this is a credible move requiring at least three years to prove worthwhile. It is super risky and brilliant at the same time.

  • What Could Go Wrong on a Site?

    moving parts
    Image by erin m via Flickr

    In the last few days I’ve heard of several entrepreneurs having challenges with their website/webapp where unexpected things are going wrong. While it has gotten much easier to build powerful websites, there are many more moving parts, and more subtle things that can break. What could go wrong on a site? Here are some examples:

    • Network goes down
    • Hard drive failure
    • Web server failure
    • Database failure
    • Domain expires
    • SSL certificate expires
    • Page doesn’t render in a certain browser (IE is the usual culprit)
    • Broken links (e.g. link to an external URL and that site changes their link structure without redirects)
    • Slow loading pages and assets
    • Third-party JavaScript causing pages not to load
    • Third-party payment gateway fails (e.g. Authorize.net, Google Checkout, Amazon Payments, etc)
    • Application functionality breaks (e.g. login fails, conversion path fails, etc)
    • Distributed denial of service
    • Spike in traffic

    As you can see, there are many different issues that can arise with a site. One of the bigger challenges as well is that the traditional pinging services, which are very popular, only catch when the site is completely down, as opposed to when a specific piece of functionality like signing-in or a payment gateway is down. My recommendation is to recognize the complexity that goes into sites today and plan accordingly.

    What else? What are some other things that can go wrong on a website/webapp?