David Cummings on Startups

Blog

  • Marketing in a Web World

    I spent time today talking with the marketing team of a successful financial-related technology company in town. It was a good opportunity to dig into their online marketing strategy — something they are in the progress of moving from primarily off-line to almost all online. Here are the categories they broke things into:

    • Buying leads (e.g. BuyerZone, VendorSeek, etc)
    • SEO/natural search
    • Paid search
    • Email
    • Webinars
    • Display ads
    • Original content sites
    • Affiliates

    I think online marketers often get focused on the most obvious categories — like paid search, SEO, and email — and don’t allocate enough dollars to experiment with other areas like buying leads or sponsoring webinars. My recommendation is to carve out a piece of the annual budget, say 5- 10%, and allocate it to experimenting with different options.

  • Develop a Routine with Potential Investors

    Say you’re thinking of raising money from investors (angels or VCs), when’s the best time to start the process? This is a trick question. The answer: when you don’t need the money.

    Hopefully you’ve heard this before, but investors like to invest when things are going so well that you don’t need the money. Why? You’re doing great and have mitigated much of the business risk, presumably by being profitable and consistently signing new customers. If you’re not at this stage of the business, and an investor expresses interest but isn’t ready to invest, I’d recommend developing a routine as follows:

    • Ask permission to provide periodic updates, which is a great way to show progress and dependability
    • Choose a timeframe for the updates (e.g. quarterly) and stick to it
    • Keep the updates short and to the point, with meaningful information (e.g. number of customers signed, revenue growth, etc)
    • Always ask if it is OK to continue to provide these updates as you don’t want to be burdensome

    Have you tried this? Does it work for you? What else would you recommend?

  • Strong Startup Categories for Atlanta

    After looking at the Atlanta Logos (atllogos.com) site, which lists hundreds of Atlanta startups in different stages, I realized we can do a better job of highlighting the categories, or markets, that Atlanta has a strong base. Historically, people tend to think of Atlanta as a strong market for B2B companies, Internet security (ISS), and logistics (UPS, Delta). Here are some other categories with a strong local base of companies:

    Oh, and Atlanta has the largest number of data centers of any metro area in the country. I encourage people to talk about these other categories, in addition to the usual suspects.

    What are some other startup categories with a strong base of companies in Atlanta?

  • Breaking Bread as a Team

    For the first six years at my company we’d recognize birthdays, or a big customer win, by taking the whole office out to lunch to celebrate as a team. After a while, this became such a frequent occurrence that I decided to have catered lunches delivered to our office every Friday, 52 weeks a year. We’ve been doing it for over three years now and it is one of the best things we do. Here are a few reasons why it is so beneficial:

    • We do it on Fridays, giving everyone a chance to end the week on a good note and talk about what’s going on in their lives
    • Breaking bread with team members is a great way to get to know each other on a more personal level, leading to stronger relationships and more trust
    • We encourage team members to bring in their spouses or kids, creating a family atmosphere
    • People love free food and to debate which places are best to order from (we usually rotate between a few different places, and change up those places every quarter)

    I didn’t know how successful it would be when we started, but having “Free Food Fridays” has been great and I highly recommend doing something similar. You won’t regret it.

  • Soft Drinks and Software

    Comparing soft drinks and software seems like a dead end road. For me, I like looking at analog analogies whereby something from the physical world is compared to something in the digital world in order to look for patterns or themes. The soft drink industry provides several examples that are relevant to the software industry:

    • Once established as the standard in a market, monopoly pricing and power emerge (e.g. Coke for soft drinks, Microsoft for OS, and Google for search)
    • Distribution (shelf space for soft drinks and customer acquisition costs for software) become one of the main drivers for success
    • The standard soft drink flavors at restaurants are like the standard apps that come with the operating system — the casual person takes whatever comes is already there
    • There are a handful of mainstream products but mostly niche offerings

    What am I missing? What are some other ways the soft drink market is like the software market?

  • EO Accelerator Strategy Day Tomorrow

    Tomorrow is Strategy day for the EO Accelerator program in Atlanta. Strategy day, in our context, is an eight hour education workshop talking about topics like:

    To many people, it might sound like fluff. To entrepreneurs that have been in the trenches building a company with employees, these items are extremely important.

    One of my colleagues in the program sent this great article for entrepreneurs working on mission statements, written by Dan Heath of Made to Stick fame: How to write a Mission Statement that doesn’t Suck.

  • Startups and the Masters Golf Tournament

    Today I had the opportunity to go to the Masters golf tournament in Augusta, GA with a friend and watch the best golfers in the world do a practice round at the famed course. The Master’s is like the Running of the Bulls in Spain in that it is an iconic Georgia institution with worldwide recognition. It really is an amazing event.

    An interesting aspect, coming from an entrepreneur and business perspective, is that the Masters has the least commercial influence of any major sporting event I’ve ever attended. Once you step in the gates, there are no billboards, logos, or ads of any sort littering the facility. Quite refreshing.

    The lack of sponsors on the grounds doesn’t mean there aren’t commercial interests every step of the way outside the gates. Here are a few we encountered during our half mile walk:

    • Parking options as far as the eye can see for $20 a spot
    • Street vendors selling badge holders, bottled water, umbrellas, Tiger Woods memorabilia, previous Master’s winner photos, John Daly stuff (not sure why!), and miscellaneous other items
    • Range Rover had a display area showing off their new Autobiography Edition
    • Several golf vendors like Adam’s and Titleist had semi-trailers configured as portable trade show facilities in a large parking lot to test out clubs

    While these weren’t technology startups, many were small businesses out hustling to earn a dollar. My biggest takeaway from the commercial setting to get to the gates: when you have a captive, targeted audience you should sell, sell, sell.

  • Ask Questions at Investor Meetings

    We did our first round of Shotput Ventures interviews today with several startups. After we asked questions, we’d always save the last five or 10 minutes and ask “do you have any questions for us?” Strangely, several teams didn’t ask us any questions. I would always have questions ready, especially when asked for one. Here are some example ones:

    • What aspects of the business/idea resonate with you?
    • Where are our weaknesses?
    • What one or two takeaways would you leave us with and emphasize we think about?
    • Is there anyone that you’d recommend we talk to about the business?
    • What’s the best way to follow-up with you?

    These are just a few questions entrepreneurs should have in mind when talking to investors.

    What are some other questions to ask?

  • Day 2 With the iPad

    So I’ve gone over 24 hours without using my laptop, which, for me, is an incredibly long amount of time. My goal was to exclusively use the iPad for that period of time to better acquaint myself with it and provide more thoughts after yesterday’s initial impressions. Here are some additional thoughts:

    • Media consumption on the device is great — big, bright screen with clear sound
    • After using it for a day, it is still a good ways away from replacing my laptop due to the lack of multi-tasking support as I like to have Pandora playing, with Google Talk, Google Chrome, and Mozilla Thunderbird all open at the same time
    • I miss the Smart Folders feature of Mozilla Thunderbird that allows me to see my different email accounts in one inbox, while still organizing mail with account-specific IMAP folders
    • TweetDeck for the iPad is nice with the in-frame browser while in vertical display mode, but I can’t resize that browser window and clicking “View in Safari” doesn’t seem to work right now
    • Google Reader is mostly broken on the iPad right (can’t click through to an article, can’t load more entries, can’t mark as read, etc)
    • Pandora for iPad should add an in-frame browser to the app as a workaround until the iPad supports multi-tasking
    • My almost-three-year-old son absolutely loves the device and can do the drawing app and Red Fish app all day long (it’ll be great for him on long car rides!)
    • Battery life is excellent and more than doubles in usage length compared to any laptop I’ve had

    I still give the iPad a thumbs up but would say it is only a 50% replacement for a laptop at this time. It really excels as a content consumption device and lacks as a content creation device.

  • Quick Thoughts on the iPad

    So, like many of the other Mac Fan Boys, I ordered an iPad when the pre-orders opened up less than a month ago. My iPad came today and I must say I’m more impressed than expected. I’ve had an iPhone for two years now, during which time it has helped me be more productive compared to the Treos I had had for many years prior. With that said, here are my quick thoughts on the iPad:

    • Feels great in my hands and lighter than expected
    • Will replace my laptop for 80% of my computer usage at home
    • Still requires a computer, at least to get started (when you turn on the iPad it requires a connection to a computer with iTunes before you can do anything, which is annoying)
    • The Free Books app is great and has access to over 24,000 public domain books, like Alice in Wonderland, available for free in a nice format
    • The NY Times app is well done and is the perfect format for reading as part of my morning routine
    • Typing on the keyboard is sub-par, due to the fact that the screen and keyboard are on the same surface and there isn’t any tactile feedback, causing you to have to hunch over, unlike a laptop. With that said, I can still type fast enough to compose most emails I send.
    • Battery life is outstanding — I expect to only charge it a couple times per week

    For $499, the iPad is a great deal and I recommend it.